REG - Scot.Mort Inv Tst - Scottish Mortgage Half-year Results
07/11/2025 07:00
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RNS Number : 5805G Scottish Mortgage Inv Tst PLC 07 November 2025
RNS Announcement
Scottish Mortgage Investment Trust PLC
Legal Entity Identifier: 213800G37DCS3Q9IJM38
Results for the six months to 30 September 2025
The following is the unaudited Interim Financial Report for the six months to
30 September 2025 which was approved by the Board on 6 November 2025.
Chairman's interim update
Introduction
I am pleased to report on a strong six-month period for your Company. Over the
six months to 30 September 2025, Scottish Mortgage's Net Asset Value per
share rose by 22.9%, ahead of the FTSE All-World Index's 15.4% gain. The share
price increased by 20.9% (all figures on a total return* basis).
Whilst these results are encouraging, six months represents too short a time
frame on which to judge performance given the long-term nature of the
investment strategy. Investing in companies at the forefront of structural
change means share price peaks and troughs are inevitable. We ask that
shareholders remain aligned to our long investment horizon and are aware that
returns are not delivered in a straight line.
Performance Drivers
Total return* (%) Six months to
30 September 2025
NAV (borrowings at fair value) 22.9%
Share price 20.9%
FTSE All-World Index 15.4%
* Alternative Performance Measure - see Glossary of terms and Alternative
Performance Measures below.
The period's strong returns reflected a growing market recognition that the
companies driving fundamental technological and economic transformation have
emerged from recent volatility with strengthened competitive positions.
Returns were broad-based across the portfolio, encompassing businesses
operating in diverse geographies from Asia to the Americas and Europe.
What united these contributors was not their sector classification, but
rather their shared characteristics: the ability to scale efficiently, to
benefit from compounding effects, and to operate with a long-term perspective
in sectors undergoing structural change.
The performance demonstrated that patience through periods of market
dislocation can be rewarded when underlying business fundamentals remain
strong and innovation continues to advance. Further details are contained in
the Managers' Report.
Total return* (%) Five years to 30 September 2025 Ten years to 30 September 2025
NAV (borrowings at fair value) 30.3% 472.4%
Share price 17.3% 400.4%
FTSE All-World Index 85.4% 263.3%
* Alternative Performance Measure - see Glossary of terms and Alternative
Performance Measures below.
Liquidity
The share price discount to NAV widened slightly from 9.0% to 10.5% over the
six months to 30 September. During the period, the Company repurchased 75.2m
shares, at a total cost of £765.4m.
The Company has bought back shares for consideration of £2.6 billion since
the Board announced in March 2024 that the Company would make available at
least £1 billion for the purpose of buybacks over the following two years.
This activity has had a positive impact, including:
- limiting discount volatility
- meaningful accretion to net asset value
- helping to maintain a stable shareholder register
- narrowing the discount compared to the period prior to March
2024.
The Board continues to take a pragmatic approach in making capital allocation
calls between buying back shares and other uses of capital such as making new
investments and reducing debt. The Board and the Managers remain committed to
the continuation of the buyback.
Beyond share buybacks, the Board is determined to stimulate demand for the
Company's shares and reduce the discount by continuing to develop and broaden
marketing efforts in the UK and overseas. We recognise the importance of
reaching potential shareholders who understand and appreciate the Company's
long-term investment approach.
Earnings and dividend
Revenue earnings for the period were higher than the comparable period,
primarily due to the previous six months' earnings being depressed by the
write-off of Northvolt's accrued bond income. Although income from the
portfolio was slightly lower, the Board is proposing an unchanged interim
dividend of 1.60 pence per share.
The portfolio generates limited income given that the companies we hold
generally reinvest their earnings to pursue growth opportunities.
Nevertheless, the Board recognises that many shareholders value the
predictable and growing dividend. The Company is an 'AIC Dividend Hero',
having increased its dividend for 43 consecutive years. The Board expects to
declare an increased final dividend to maintain this status and continue this
important trend.
Board
I would like to begin by expressing my deep gratitude to Justin Dowley who
retired as Chairman at the Annual General Meeting in July. Justin served on
the Board with distinction, from 2015, first as Audit Chair before assuming
the Chairmanship for the final two years of his tenure. His expert leadership
guided the Company through a period of considerable challenge, including
significant market volatility and structural shifts in the investment trust
sector. Justin's calm stewardship, sound judgement and unwavering commitment
to shareholders' long-term interests have left the Company in a strong
position. On behalf of the Board and shareholders, I thank him for his
exceptional service.
It is both a delight and a privilege for me to have joined the Board of
Scottish Mortgage and to serve as Chairman. The Company's mission - to
identify and support transformational growth businesses - is as compelling as
it is important, and I look forward to working with my fellow Directors and
the Managers to serve shareholders' interests over the years ahead.
The Board values diversity of thought and experience in its composition.
Directors with varied professional backgrounds, different cognitive approaches
to problem-solving, and contrasting life experiences bring richness to our
discussions that strengthens the quality of decision-making and the challenge
brought to the Managers. This intellectual diversity enables us to question
assumptions more effectively, consider issues from multiple perspectives, and
better understand the complex and evolving markets in which the Company
operates.
As previously announced, Professor Maxwell will retire following the
conclusion of the AGM in 2026. As part of our ongoing board refreshment
process, we are mindful of governance expectations regarding diversity in all
its forms, including gender representation. The Board remains committed to
maintaining a composition that combines diverse thinking with the skills and
experience necessary to serve the long-term interests of shareholders
effectively.
Outlook
We are living through a period of deep technological transformation. AI is
reshaping how businesses operate, infrastructure supporting that change is in
high demand, and progress is being made in areas as diverse as personalised
healthcare, electrification, and digital content.
The companies driving these shifts operate across continents and sectors but
share the same ambition: to reimagine what's possible. Our task is to seek
out these rare businesses creating the future, and to support them with
long-term and constructive ownership. With a strong balance sheet, high
conviction in the current portfolio, and patient capital, your Company is well
positioned to deliver meaningful returns for shareholders over the coming
years.
Christopher Samuel
Chairman
6 November 2025
Interim management report
The six months to 30 September 2025 have been a period of meaningful progress,
not only in markets, but more importantly, in the companies leading
fundamental change. Scottish Mortgage's Net Asset Value per share rose by
22.9%, ahead of the FTSE All-World Index's 15.4% gain. The share price
increased by 20.9% (all figures on a total return* basis).
These results reflect renewed investor interest in innovation and growth but
also a recognition that many of the companies driving transformation have
emerged from the recent dislocation stronger, more efficient, and more
ambitious.
A Global Engine of Progress
This period's strongest returns came from companies building real capabilities
across a wide range of sectors and geographies. It has become increasingly
clear that the forces reshaping the global economy, from artificial
intelligence to digital commerce and electrification, are not confined to any
one country or industry. Our top contributors reflected this global diversity.
The build-out of artificial intelligence infrastructure continues to
accelerate, and the companies enabling this transformation are increasingly
being recognised for their strategic value. Our holdings in ASML and TSMC,
essential suppliers to the world's most advanced chipmakers, delivered strong
returns as investment in computing power remained a top priority for both
enterprises and governments. The performance of NVIDIA reinforced the broader
opportunity around AI hardware and software. Further up the stack, Cloudflare
and Snowflake benefited as businesses continued upgrading their digital
architecture to better handle distributed workloads, data integration, and
AI‑enhanced applications.
The expansion of digital platforms, both consumer- and enterprise-facing, also
contributed significantly. Companies like Roblox, Meta, and Spotify
appreciated as user engagement and monetisation improved. In each case,
long-term product and network investments are bearing fruit. These platforms
have shown that when usage and creator ecosystems deepen, business models
become more resilient and scalable. Likewise, Netflix demonstrated that
disciplined content investment and pricing power can still produce robust
growth in a more mature market.
In commerce and logistics, our holdings in MercadoLibre and Sea performed
well. These businesses, often underappreciated due to their regional focus in
Latin America and Southeast Asia, are building scaled and profitable
ecosystems not just in ecommerce, but also in digital payments and financial
services. The story is similar at Shopify and Doordash, which capitalised on
previous infrastructure investment to improve profitability and capital
efficiency.
We also saw renewed investor attention in companies tied to electrification
and clean energy. CATL, the dominant Chinese battery manufacturer, and Tesla,
a long-standing holding, both contributed positively. Despite differing
regulatory and competitive dynamics, each benefits from the global trend
toward electrification, and from deep vertical integration in their respective
segments.
Underlying all these businesses is a shared set of characteristics: the
ability to scale efficiently, to benefit from compounding network or data
effects, and to operate with a long-term view in sectors undergoing structural
change. Whether in Taiwan, Brazil, Sweden, Singapore or Silicon Valley, these
companies are pushing the boundaries of what's possible and the market has
begun to take notice.
Investing in the Next Generation
In recent months, we have introduced a number of new holdings that reflect how
the global economy is changing. While the sectors vary, the companies share
important traits: they are founder-led, ambitious, and well placed to benefit
from long-term shifts in technology, consumer behaviour and energy.
A key area of interest for us is the way people work, create, and interact
online. We invested in Figma, which is becoming the standard design tool for
building websites, apps and digital services. It helps teams work together in
real time and is already used by many of the world's largest companies. We
also bought shares in AppLovin, a company that helps mobile games and apps
reach the right audiences through better advertising. As people spend more
time on their phones, AppLovin is helping app developers grow their businesses
more efficiently.
We continue to look for platforms that understand the next generation of
internet users. Xiaohongshu, or "Little Red Book", is one of the most popular
lifestyle platforms in China. Its users are mostly young and urban and use it
to discover products and share ideas about fashion, beauty, travel and more.
The platform is growing quickly but still has lots of room to expand through
advertising and ecommerce.
Electrification remains one of the most important global trends. We added
CATL, the world's largest battery maker, which supplies electric vehicle and
energy storage companies across Asia, Europe and the US. We also added to our
position in BYD, a Chinese company that makes electric cars and buses. Both
companies are positioned to benefit as transport systems shift away from
fossil fuels.
Finally, we invested in Anthropic, a company building the next generation of
artificial intelligence. While still at an early stage, it is one of a small
number of teams globally with the expertise to train powerful AI models. These
technologies could reshape how people interact with software, and how
information is processed and used. We believe the company has the right mix of
technical depth, safety focus and commercial potential. Anthropic (like
Xiaohongshu) is a private company. Access to private companies is a necessity
for investors wanting exposure to the new generation of companies focused on
training AI models.
Funding has come from reductions in holdings such as Amazon, Roblox, Spotify,
Meta Platforms, Netflix, Tempus AI, MercadoLibre and Shopify. Each has
delivered operational progress, often with improved financial performance or
renewed investor recognition. These reductions were not driven by any loss of
conviction. On the contrary, we remain supportive of their long-term
potential and in all cases retain meaningful positions.
Beneath the Headlines
Inflation has eased meaningfully from its post-pandemic peaks, though it
remains above historical norms in many parts of the world. Interest rates
appear to have peaked for now, and while central banks are in no rush to ease,
market expectations are more stable than they have been in some time.
Geopolitical tensions from US-China rivalry to regional conflicts continue to
shape supply chains and national policy. However, we believe the most
important shifts are not occurring in policy corridors, but in labs,
datacentres, and factories around the world.
This is a period of deep technological transformation. AI is reshaping how
businesses operate and how decisions are made. The infrastructure powering
that change is in high demand. But progress is not limited to computing. We're
seeing progress in areas as diverse as personalised healthcare,
electrification, logistics, and digital content. The companies driving these
shifts operate across continents, cultures, and sectors but they share the
same ambition to reimagine what's possible.
Patience, Rewarded
Periods of strong performance are welcome, but they do not change our
approach. We are not chasing short-term trends or market approval. We are
long-term owners, focused on identifying the exceptional few companies that
can deliver transformational outcomes over decades.
Many of the companies that contributed most this period did so after long
stretches of being out of favour. Their short-term returns were not linear nor
were they predictable. But they reflect what we believe is the essence of
successful investing: patience in the face of noise, and conviction in the
face of doubt.
We thank shareholders who share that mindset. Our task is to seek out the rare
businesses creating the future, and to support them with long-term and
constructive ownership, wherever in the world they may be.
Tom Slater
Baillie Gifford & Co Limited
Managers and Secretaries
6 November 2025
* Alternative Performance Measure - see Glossary of terms and Alternative
Performance Measures below.
Total return information sourced from LSEG/Baillie Gifford.
See disclaimer below.
Past performance is not a guide to future performance.
The principal risks and uncertainties facing the Company are set out at the
end of this announcement.
Responsibility statement
We confirm that to the best of our knowledge:
a) the condensed set of Financial Statements has been prepared in
accordance with FRS 104 'Interim Financial Reporting';
b) the Interim Management Report includes a fair review of the
information required by Disclosure and Transparency Rule 4.2.7R (indication of
important events during the first six months, their impact on the condensed
set of Financial Statements and a description of the principal risks and
uncertainties for the remaining six months of the year); and
c) the Interim Financial Report includes a fair review of the
information required by Disclosure and Transparency Rule 4.2.8R (disclosure of
related party transactions and changes therein).
By order of the Board
Christopher Samuel
Chairman
6 November 2025
Performance, Portfolio executive summary, and List of Investments at 30 September 2025
http://www.rns-pdf.londonstockexchange.com/rns/5805G_1-2025-11-6.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/5805G_1-2025-11-6.pdf)
Income statement (unaudited)
For the six months ended 30 September
Notes 2025 2025 2025 2024 2024 2024
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Gains on investments - 2,653,905 2,653,905 - 199,331 199,331
Currency gains - 33,938 33,938 - 49,271 49,271
Income 21,956 - 21,956 22,996 - 22,996
Investment management fee 3 - (19,866) (19,866) - (18,282) (18,282)
Other administrative expenses (2,299) - (2,299) (6,581) - (6,581)
Net return before finance costs and taxation 19,657 2,667,977 2,687,634 16,415 230,320 246,735
Finance costs of borrowings - (26,251) (26,251) - (28,150) (28,150)
Net return before taxation 19,657 2,641,726 2,661,383 16,415 202,170 218,585
Tax (1,622) - (1,622) (1,575) (2,951) (4,526)
Net return after taxation 18,035 2,641,726 2,659,761 14,840 199,219 214,059
Net return per ordinary share 4 1.55p 227.58p 229.13p 1.12p 14.97p 16.09p
Dividends proposed per ordinary share 5 1.60p 1.60p
The accompanying notes below are an integral part of the Financial Statements.
The total column of this statement is the profit and loss account of the
Company. The supplementary revenue and capital return columns are prepared
under guidance published by the Association of Investment Companies.
All revenue and capital items in this statement derive from continuing
operations.
A Statement of Comprehensive Income is not required as all gains and losses of
the Company have been reflected in the above statement.
Balance sheet (unaudited)
Notes At At At At
30 September
30 September
31 March 2025 31 March 2025
2025 2025
(audited) (audited)
£'000 £'000
£'000 £'000
Fixed assets
Investments held at fair value through profit or loss 6 15,488,809 13,665,731
Current assets
Debtors 9,399 69,511
Cash and cash equivalents 68,179 9,013
77,578 78,524
Creditors
Amounts falling due within one year: 7
Bank loans (423,398) (441,592)
Other creditors and accruals (33,664) (37,923)
(457,062) (479,515)
Net current liabilities (379,484) (400,991)
Total assets less current liabilities 15,109,325 13,264,740
Creditors
Amounts falling due after more than one year: 7
Bank loans (133,705) (139,454)
Loan notes (980,373) (991,493)
Debenture stocks (51,071) (51,328)
(1,165,149) (1,182,275)
Net assets 13,944,176 12,082,465
Capital and reserves
Called up share capital 74,239 74,239
Share premium account 928,400 928,400
Capital redemption reserve 19,094 19,094
Capital reserve 12,904,408 11,057,697
Revenue reserve 18,035 3,035
Total shareholders' funds 13,944,176 12,082,465
Net asset value per ordinary share
(after deducting borrowings at book)* 1,238.6p 1006.0p
Ordinary shares in issue 9 1,125,821,279 1,201,051,727
* See Glossary of terms and Alternative Performance Measures below.
The accompanying notes below are an integral part of the Financial Statements.
Statement of changes in equity (unaudited)
For the six months ended 30 September 2025
Notes Called up Share Capital Capital Revenue Shareholders'
share premium redemption reserve * reserve funds
capital account reserve £'000 £'000 £'000
£'000 £'000 £'000
Shareholders' funds at 1 April 2025 74,239 928,400 19,094 11,057,697 3,035 12,082,465
Net return after taxation - - - 2,641,726 18,035 2,659,761
Ordinary shares bought back into treasury 9 - - - (765,440) - (765,440)
Dividends paid during the year 5 - - - (29,575) (3,035) (32,610)
Shareholders' funds at 30 September 2025 74,239 928,400 19,094 12,904,408 18,035 13,944,176
For the six months ended 30 September 2024
Notes Called up Share Capital Capital Revenue Shareholders'
share premium redemption reserve * reserve funds
capital account reserve £'000 £'000 £'000
£'000 £'000 £'000
Shareholders' funds at 1 April 2024 74,239 928,400 19,094 11,591,680 16,401 12,629,814
Net return after taxation - - - 199,219 14,840 214,059
Ordinary shares bought back into treasury 9 - - - (880,114) - (880,114)
Dividends paid during the period 5 - - - (18,775) (16,401) (35,176)
Shareholders' funds at 30 September 2024 74,239 928,400 19,094 10,892,010 14,840 11,928,583
* The capital reserve balance at 30 September 2025 includes investment
holding gains on fixed asset investments of £5,171,216,000 (30 September
2024 - gains of £3,446,573,000).
The accompanying notes below are an integral part of the Financial Statements.
Cash flow statement (unaudited)
For the six months ended 30 September
Notes 2025 2024
£'000 £'000
Cash flows from operating activities
Net return before taxation 2,661,383 218,585
Adjustments to reconcile company net return before
tax to net cash flow from operating activities
Gains on investments (2,653,905) (199,331)
Currency gains (33,938) (49,271)
Finance costs of borrowings 26,251 28,150
Taxation
Overseas withholding tax (1,759) (1,450)
Other capital movements
Changes in debtors and creditors 1,361 1,187
Cash used in operations (607) (6,248)
Interest paid (26,603) (28,868)
Net cash outflow from operating activities (27,210) (35,116)
Cash flows from investing activities
Acquisitions of investments (668,627) (1,426,631)
Disposals of investments 1,560,174 2,374,212
Net cash inflow from investing activities 891,547 947,581
Cash flows from financing activities
Equity dividends paid 5 (32,610) (35,176)
Ordinary shares bought back into treasury and stamp duty thereon (771,404) (918,626)
Bank loans repaid 418,458 (500,421)
Bank loans drawn down 7 (418,458) 500,421
Net cash outflow from financing activities (804,014) (953,802)
Decrease in cash and cash equivalents 60,323 (41,337)
Exchange movements (1,157) (4,740)
Cash and cash equivalents at start of period 9,013 123,762
Cash and cash equivalents at end of period* 68,179 77,685
* Cash and cash equivalents represent cash at bank and short term money
market deposits repayable on demand.
The accompanying notes below are an integral part of the Financial Statements.
Notes to the financial statements (unaudited)
1 Basis of accounting
The condensed Financial Statements for the six months to 30
September 2025 comprise the statements set out above together with the related
notes below. They have been prepared in accordance with FRS 104 'Interim
Financial Reporting' and the AIC's Statement of Recommended Practice issued in
November 2014 and updated in July 2022 with consequential amendments. They
have not been audited or reviewed by the Auditor pursuant to the Auditing
Practices Board Guidance on 'Review of Interim Financial Information'. The
Financial Statements for the six months to 30 September 2025 have been
prepared on the basis of the same accounting policies as set out in the
Company's Annual Report and Financial Statements at 31 March 2025.
Going concern
In accordance with the Financial Reporting Council's
guidance on going concern and liquidity risk, the Directors have undertaken a
rigorous review of the Company's ability to continue as a going concern. The
Directors have considered the nature of the Company's assets, its liabilities,
projected income and expenditure together with its investment objective and
policy, dividend policy and principal risks and uncertainties, as set out on
the inside front cover. The Board has, in particular, considered the impact of
heightened macroeconomic and geopolitical concerns including the ongoing
Russia-Ukraine war and global trade tensions. It has reviewed the results of
specific leverage and liquidity stress testing but does not believe the
Company's going concern status is affected. The Company's assets, the majority
of which are in quoted securities which are readily realisable, exceed its
liabilities significantly. All borrowings require the prior approval of the
Board. Gearing levels and compliance with borrowing covenants is reviewed by
the Board on a regular basis.
The Company has continued to comply with the investment
trust status requirements of section 1158 of the Corporation Tax Act 2010 and
the Investment Trust (Approved Company) Regulations 2011. Accordingly, the
Directors considered it appropriate to adopt the going concern basis of
accounting in preparing these Financial Statements and confirm that they are
not aware of any material uncertainties which may affect the Company's ability
to continue in operational existence for a period of at least twelve months
from the date of approval of these Financial Statements.
2 Financial information
The financial information contained within this Interim
Financial Report does not constitute statutory accounts as defined in sections
434 to 436 of the Companies Act 2006. The financial information for the year
ended 31 March 2025 has been extracted from the statutory accounts which have
been filed with the Registrar of Companies. The Auditors' Report on those
accounts was not qualified, did not include a reference to any matters to
which the Auditors drew attention by way of emphasis without qualifying its
report and did not contain statements under sections 498 (2) or (3) of the
Companies Act 2006.
3 Investment manager
Baillie Gifford & Co Limited, a wholly owned subsidiary
of Baillie Gifford & Co, has been appointed by the Company as its
Alternative Investment Fund Manager ('AIFM') and Company Secretary. The
investment management function has been delegated to Baillie Gifford & Co.
The management agreement can be terminated on six months' notice. The annual
management fee is 0.30% on the first £4 billion of total assets less current
liabilities (excluding short term borrowings for investment purposes) and
0.25% thereafter, calculated and payable quarterly.
4 Net return per ordinary share
Six months to Six months to
30 September 30 September
2025 2024
£'000 £'000
Revenue return on ordinary activities after taxation 18,035 14,840
Capital return on ordinary activities after taxation 2,641,726 199,219
Total net return 2,659,761 214,059
Weighted average number of ordinary shares in issue 1,160,802,949 1,330,142,922
The net return per ordinary share figures are based on the
above totals of revenue and capital and the weighted average number of
ordinary shares in issue during each period.
There are no dilutive or potentially dilutive shares in
issue.
5 Dividends
Six months to Six months to
30 September 30 September
2025 2024
£'000 £'000
Amounts recognised as distributions in the period:
Previous year's final dividend of 2.78p (2024 - 2.64p), paid 10 July 2025 (32,610) 35,175
(32,610) 35,175
Dividends proposed in the period:
Interim dividend for the year ending 31 March 2026 of 1.60p (2025 - 1.60p) 18,013 20,167
18,013 20,167
The interim dividend was declared after the period end date
and has therefore not been included as a liability in the Balance Sheet. It is
payable on 12 December 2025 to shareholders on the register at the close of
business on 21 November 2025. The ex-dividend date is 20 November 2025. The
Company's Registrars offer a Dividend Reinvestment Plan and the final date for
elections for this dividend is 25 November 2025.
6 Fair value hierarchy
The fair value hierarchy used to analyse the basis on which
the fair values of financial instruments held at fair value through the profit
and loss account are measured is described below. The levels are determined by
the lowest (that is the least reliable or least independently observable)
level of input that is significant to the fair value measurement for the
individual investment in its entirety as follows:
Level 1 - using unadjusted quoted prices for identical
instruments in an active market;
Level 2 - using inputs, other than quoted prices included
within Level 1, that are directly or indirectly observable (based on market
data); and
Level 3 - using inputs that are unobservable (for which
market data is unavailable).
The Company's investments are financial assets designated
at fair value through profit or loss. An analysis of the Company's financial
asset investments based on the fair value hierarchy described above is shown
below.
Investments held at fair value through profit or loss
As at 30 September 2025 Level 1 Level 2 Level 3 Total
£'000 £'000 £'000 £'000
Equities/funds 11,331,414 - - 11,331,414
Unlisted company ordinary shares - - 704,916 704,916
Unlisted company preference shares* - - 3,381,752 3,381,752
Unlisted company convertible note - - 19,584 19,584
Limited partnership investments - - 50,611 50,611
Contingent value rights - - 532 532
Total financial asset investments 11,331,414 - 4,157,395 15,488,809
As at 31 March 2025 (audited) Level 1 Level 2 Level 3 Total
£'000 £'000 £'000 £'000
Equities/funds 9,880,944 - - 9,880,944
Unlisted company ordinary shares - - 835,363 835,363
Unlisted company preference shares* - - 2,875,069 2,875,069
Unlisted company convertible note - - 18,872 18,872
Limited partnership investments - - 54,928 54,928
Contingent value rights - - 555 555
Total financial asset investments 9,880,944 - 3,784,787 13,665,731
During the period, Heartflow Inc was transferred from Level
3 to Level 1 on becoming listed. The fair value of listed investments is bid
value or, in the case of holdings on certain recognised overseas exchanges,
last traded price. Listed Investments are categorised as Level 1 if they are
valued using unadjusted quoted prices for identical instruments in an active
market and as Level 2 if they do not meet all these criteria but are,
nonetheless, valued using market data.
* The investments in preference shares are not classified as equity
holdings as they include liquidation preference rights that determine the
repayment (or multiple thereof) of the original investment in the event of a
liquidation event such as a take-over.
Private company investments
The Company's holdings in unlisted (private company) investments are
categorised as Level 3. Private company investments are valued at fair value
by the Directors following a detailed review and appropriate challenge of the
valuations proposed by the Managers. The Managers' private company investment
policy applies techniques consistent with the International Private Equity and
Venture Capital Valuation Guidelines 2022 ('IPEV'). The techniques applied are
predominantly market-based approaches. The market-based approaches available
under IPEV are set out below and are followed by an explanation of how they
are applied to the Company's private company portfolio:
- Multiples;
- Industry Valuation Benchmarks; and
- Available Market Prices.
The nature of the private company portfolio will influence
the valuation technique applied. The valuation approach recognises that, as
stated in the IPEV Guidelines, the price of a recent investment, if resulting
from an orderly transaction, generally represents fair value as at the
transaction date and may be an appropriate starting point for estimating fair
value at subsequent measurement dates. However, consideration is given to the
facts and circumstances as at the subsequent measurement date, including
changes in the market or performance of the investee company. Milestone
analysis is used where appropriate to incorporate the operational progress of
the investee company into the valuation. Additionally, the background to the
transaction must be considered. As a result, various multiples-based
techniques are employed to assess the valuations particularly in those
companies with established revenues. Discounted cashflows are used where
appropriate. An absence of relevant industry peers may preclude the
application of the Industry Valuation Benchmarks technique and an absence of
observable prices may preclude the Available Market Prices approach. All
valuations are cross-checked for reasonableness by employing relevant
alternative techniques.
The private company investments are valued according to a
three monthly cycle of measurement dates. The fair value of the private
company investments will be reviewed before the next scheduled three monthly
measurement date on the following occasions:
- At the year end and half year end of the Company; and
- Where there is an indication of a change in fair value as
defined in the IPEV guidelines (commonly referred to as 'trigger' events).
7 Financial liabilities
The total value of the borrowings (at book) is
£1,588,547,000 (31 March 2025 - £1,623,867,000).
The bank loans falling due within one year are
a US$100 million revolving 2 year loan with National Australia Bank
Limited, a US$170 million revolving 3 year loan with Royal Bank of Scotland
International 'RBSI' and a US$300 million fixed rate loan with Scotiabank
(31 March 2025 - US$100 million revolving 3 year loan with National
Australia Bank Limited, a US$170 million revolving 3 year loan with RBSI and
a US$300 million fixed rate loan with Scotiabank).
The bank loans falling due after more than one year
are a US$180 million fixed rate loan with RBSI (31 March 2025 - US$180
million fixed rate loan with RBSI.
Debenture stocks include a £50 million debenture redeeming
in 2026 and a £675,000 irredeemable debenture.
Loan notes are unsecured with redemptions from 2036
to 2062.
The weighted average cost of the borrowings as at
30 September 2025 is 3.1% (31 March 2025 - 3.1%)
8 Fair value of financial liabilities
The fair value of the borrowings at 30 September 2025 was
£1,219,955,000 (31 March 2025 - £1,250,992,000).
9 Share capital: ordinary shares of 5p each
At 30 September At 31 March
2025 2025
No. of shares (audited)
No. of shares
Allotted, called up and fully paid ordinary shares of 5p each 1,125,821,279 1,201,051,727
Treasury shares of 5p each 358,959,601 283,729,153
Total 1,484,780,880 1,484,780,880
In the six months to 30 September 2025, the Company sold no
ordinary shares from treasury (year to 31 March 2025 - nil).
In the six months to 30 September 2025, 75,230,448 ordinary
shares with a nominal value of £3,761,522 were bought back at a total cost of
£765,440,000 and held in treasury (year to 31 March 2025 - 184,816,766
shares with a nominal value of £9,241,000 were bought back at a total cost of
£1,709,766,000 and held in treasury). At 30 September 2025 the Company had
authority remaining to buy back 139,817,936 ordinary shares.
10 Related party transactions
There have been no transactions with related parties during
the first six months of the current financial year that have materially
affected the financial position or the performance of the Company during that
period and there have been no changes in the related party transactions
described in the last Annual Report and Financial Statements that could have
had such an effect on the Company during that period.
None of the views expressed in this document should be construed as advice to
buy or sell a particular investment.
Glossary of terms and Alternative Performance Measures ('APM')
An alternative performance measure ('APM') is a financial measure of
historical or future financial performance, financial position, or cash flows,
other than a financial measure defined or specified in the applicable
financial reporting framework. The APMs noted below are commonly used measures
within the investment trust industry and serve to improve comparability
between investment trusts.
Total assets
This is the Company's definition of adjusted total assets, being the total
value of all assets held less all liabilities (other than liabilities in the
form of borrowings).
Net asset value
Also described as shareholders' funds. Net asset value ('NAV') is the value of
total assets less liabilities (including borrowings). Net asset value is
calculated on the basis of borrowings stated at book value or fair value. An
explanation of each basis is provided below. The NAV per share is calculated
by dividing this amount by the number of ordinary shares in issue (excluding
treasury shares).
Net asset value (borrowings at book)
Borrowings are valued at adjusted net issue proceeds. The value of the
borrowings at book is set out in note 7 above.
Net asset value (borrowings at fair value) (APM)
Borrowings are valued at an estimate of their market worth. The value of the
borrowings at fair is set out in note 8 above and a reconciliation to net
asset value with borrowings at book value is provided below.
30 September 2025 31 March 2025
Net asset value per ordinary share (borrowings at book value) 1,238.6p 1,006.0p
Shareholders' funds (borrowings at book value) £13,944,176,000 £12,082,465,000
Add: book value of borrowings £1,588,547,000 £1,623,867,000
Less: fair value of borrowings (£1,219,955,000) (£1,250,992,000)
Net asset value (borrowings at fair value) £14,312,768,000 £12,455,340,000
Shares in issue at year end (excluding treasury shares) 1,125,821,279 1,201,051,727
Net asset value per ordinary share (borrowings at fair value) 1,271.3p 1,037.0p
Net liquid assets
Net liquid assets comprise current assets less current liabilities, excluding
borrowings.
Discount/premium (APM)
As stock markets and share prices vary, an investment trust's share price is
rarely the same as its NAV. When the share price is lower than the NAV per
share it is said to be trading at a discount. The size of the discount is
calculated by subtracting the share price from the NAV per share and is
usually expressed as a percentage of the NAV per share. If the share price
is higher than the NAV per share, it is said to be trading at a premium.
30 September 2025 31 March 2025
NAV (book) NAV (fair) NAV (book) NAV (fair)
Net asset value per share (a) 1,238.6p 1,271.3p 1,006.0p 1,037.0p
Share price (b) 1,137.5p 1,137.5p 943.4p 943.4p
Discount ((b)-(a)) ÷ (a) (8.2%) (10.5%) (6.2%) (9.0%)
Active share (APM)
Active share, a measure of how actively a portfolio is managed, is the
percentage of the listed portfolio that differs from its comparative index. It
is calculated by deducting from 100 the percentage of the listed portfolio
that overlaps with the comparative index. An active share of 100 indicates no
overlap with the index and an active share of zero indicates a portfolio that
tracks the index.
Gearing (APM)
At its simplest, gearing is borrowing. Just like any other public company, an
investment trust can borrow money to invest in additional investments for its
portfolio. The effect of the borrowing on the shareholders' assets is called
'gearing'. If the Company's assets grow, the shareholders' assets grow
proportionately more because the debt remains the same, but if the value of
the Company's assets falls, the situation is reversed. Gearing can therefore
enhance performance in rising markets but can adversely impact performance in
falling markets. Gearing represents borrowings at book value less cash and
cash equivalents (including any outstanding trade settlements) expressed as a
percentage of shareholders' funds.
30 September 2025 31 March 2025
£'000 £'000
Borrowings (at book value) £1,588,547 £1,623,867
Less: cash at bank and in hand (£68,179) (£9,013)
Less: sales for subsequent settlement (£1,542) (£62,263)
Add: purchases for subsequent settlement - -
Adjusted borrowings (a) £1,518,826 £1,552,591
Shareholders' funds (b) £13,944,176 £12,082,465
Gearing: (a) as a percentage of (b) 11% 13%
Gross gearing is the Company's borrowings expressed as a percentage of
shareholders' funds.
30 September 2025 31 March 2025
£'000 £'000
Borrowings (at book value) (a) £1,588,547 £1,623,867
Shareholders' funds (b) £13,944,176 £12,082,465
Gross gearing: (a) as a percentage of (b) 11% 13%
Turnover (APM)
Turnover is calculated as the minimum of purchases and sales in a month,
divided by the average market values of the portfolio, summed to get rolling
12 months turnover data.
Total return (APM)
The total return is the return to shareholders after reinvesting the net
dividend on the date that the share price goes ex-dividend.
30 September 2025 30 September 2024
NAV NAV Share NAV NAV Share
(book) (fair) price (book) (fair) price
Closing NAV per share/share price (a) 1,238.6p 1,271.3p 1,137.5p 928.1p 952.1p 837.0p
Dividend adjustment factor* (b) 1.0025 1.0025 1.0028 1.0027 1.0027 1.0029
Adjusted closing NAV per share/share price (c = a x b) 1,241.7p 1,274.5p 1,140.7p 930.7p 954.7p 839.4p
Opening NAV per share/ (d) 1,006.0p 1,037.0p 943.4p 911.3p 936.6p 894.0p
share price
Total return (c ÷ d)-1 23.4% 22.9% 20.9% 2.1% 1.9% (6.1%)
* The dividend adjustment factor is calculated on the assumption that
the final dividend of 2.78p (2024 - 2.64p) paid by the Company during the
period was reinvested into shares of the Company at the cum income NAV per
share/share price, as appropriate, at the ex-dividend date.
Unlisted (private) company
An unlisted or private company means a company whose shares are not available
to the general public for trading and are not listed on a stock exchange.
Principal risks and uncertainties
The principal risks facing the Company are financial risk, private company
investments risk, investment strategy risk, climate and governance risk,
discount risk, regulatory risk, custody and depositary risk, operational risk,
cyber security risk, leverage risk, political risk and emerging risks. An
explanation of these risks and how they are managed is set out on pages 48 to
51 of the Company's Annual Report and Financial Statements for the year to 31
March 2025 which is available on the Company's website: scottishmortgage.com.
The principal risks and uncertainties have not changed since the date of that
report.
Shareholders will be notified on or around 18 November 2025 that the Interim
Financial Report has been published and will be available on the Scottish
Mortgage page of the Managers' website scottishmortgageit.com
(https://www.scottishmortgage.com/en/rest-of-world/existing-shareholders)
.(‡)
None of the views expressed in this document should be construed as advice to
buy or sell a particular investment.
Scottish Mortgage Investment Trust PLC is an actively managed, low cost
investment trust, investing in a concentrated global portfolio of companies
with the aim of maximising its total return over the long term. It looks for
strong businesses with above-average returns and aims to achieve a greater
return than the FTSE All-World Index (in sterling terms) over a five year
rolling period.
You can find up to date performance information about Scottish Mortgage on the
Scottish Mortgage page of the Managers' website at scottishmortgageit.com(‡)
‡ Neither the contents of the Managers' website nor the
contents of any website accessible from hyperlinks on the Managers' website
(or any other website) is incorporated into, or forms part of, this
announcement.
Scottish Mortgage is managed by Baillie Gifford & Co, the Edinburgh based
fund management group with over £214 billion under management and advice in
active equity and bond portfolios for clients in the UK and throughout the
world (as at 6 November 2025).
Investment Trusts are UK public limited companies and are not authorised or
regulated by the Financial Conduct Authority.
Past performance is not a guide to future performance. The value of an
investment and any income from it is not guaranteed and may go down as well as
up and investors may not get back the amount invested. This is because the
share price is determined by the changing conditions in the relevant stock
markets in which the Company invests and by the supply and demand for the
Company's shares.
6 November 2025
For further information please contact:
Claire Shaw, Baillie Gifford & Co
Tel: 0131 474 5115
Jonathan Atkins, Four Communications
Tel: 0203 920 0555 or 07872 495396
Automatic Exchange of Information
In order to fulfil its obligations under UK tax legislation relating to the
automatic exchange of information, Scottish Mortgage Investment Trust PLC is
required to collect and report certain information about certain shareholders.
The legislation requires investment trust companies to provide personal
information to HMRC on certain investors who purchase shares in investment
trusts. Accordingly, Scottish Mortgage Investment Trust PLC will have to
provide information annually to the local tax authority on the tax residencies
of a number of non-UK based certificated shareholders and corporate entities.
New shareholders, excluding those whose shares are held in CREST, who come on
to the share register will be sent a certification form for the purposes of
collecting this information.
For further information, please see HMRC's Quick Guide: Automatic Exchange of
Information - information for account holders
gov.uk/guidance/automatic-exchange-of-information-account-holders
(https://www.gov.uk/guidance/automatic-exchange-of-information-account-holders)
.
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