REG - Smithson Inv.Trust - INTERIM RESULTS ANNOUNCEMENT
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RNS Number : 1976R Smithson Investment Trust PLC 02 February 2026
SMITHSON INVESTMENT TRUST PLC
LEI: 52990070BDK2OKX5TH79
Date: 2 February 2026
INTERIM RESULTS ANNOUNCEMENT
Results for the twelve months ended 31 December 2025
Performance Highlights
Net Asset Value
At At
31 December 2025 31 December 2024
Net assets £1,720,475,000 £2,129,897,000
Net asset value ("NAV") per ordinary share ("share") 1,601.5p 1,631.8p
Share price 1,566.0p 1,484.0p
Share price discount to NAV(1) 2.2% 9.1%
For the period from
Company's listing on
Twelve months ended Twelve months ended 19 October 2018 to
31 December 2025 31 December 2024 31 December 2025
% Change % Change % Change
NAV total return per share(1) (1.8)% 2.1% 60.2%
Share price total return(1) 5.6% 4.9% 56.6%
Comparator index total return(2) 10.2% 11.5% 80.9%
Ongoing charges ratio(1) 0.9% 0.9% 0.9%
Source: Bloomberg.
This report contains terminology that may be unfamiliar to some readers. The
Glossary section gives definitions for frequently used terms.
(1) These are Alternative Performance Measures ("APMs"). Definitions of these,
together with how these measures have been calculated, are disclosed later
where it is made clear how these APMs relate to figures disclosed and
calculated under IFRS.
(2) MSCI World SMID Cap Index, £Net Source: www.msci.com.
Chairman's Statement
I am pleased to present this Interim Report of the Smithson Investment Trust
plc (the "Company") for the twelve months ended 31 December 2025. Subject to
shareholder approval of the Board's recommended restructuring in February, the
past year will have marked a period of profound change for the Company.
The Board is recommending that the Company be converted into an open-ended
investment company, or 'OEIC', which will allow shareholders to participate in
the same investment strategy with the same management team, or, should they
prefer, realise their investment at close to NAV, thus effectively eliminating
the persistent discount at which the shares have traded in recent years.
Proposed restructuring of the Company
Despite the Board's efforts to reduce the discount to net asset value by
buying back 39.3% of the shares in issue since April 2022, the shares
continued to trade at a significant discount throughout 2025. In the absence
of any signs of imminent improvement in prevailing underlying equity market
dynamics, the Board began actively to explore a range of options to address
the discount and to optimise shareholder value.
Following careful consideration of a number of alternatives, the Board
announced, on 12 November 2025, that the Company had entered into an agreement
with its manager Fundsmith for the proposed rollover of the Company's assets
into an open-ended investment company, Smithson Equity Fund.
On 22 January 2026 a circular setting out the details of the Company's
conversion into an open‑ended fund was published, and the Board recommends
this Scheme to shareholders and urges them to vote in favour of the
resolutions at the two general meetings required to approve and implement the
Scheme. Details of the Scheme are contained on the Company's website at
www.smithson.co.uk/restructure-proposal.
Inevitably at some point in the future the prevailing market cycle will
change, and smaller and medium sized companies will once again outperform
large companies globally. In addition, Fundsmith's established investment
style and philosophy will doubtless produce attractive relative and absolute
returns once more. The Scheme therefore offers shareholders the opportunity to
rollover into the new Smithson Equity Fund which will follow the Company's
current investment strategy and be managed by Fundsmith. With the OEIC
structure, shareholders will be able to buy and sell at net asset value daily.
Shareholders who prefer to realise their investment can elect for the cash
exit option and effectively sell at a level that no longer has a discount
attached.
Throughout the process the Board has sought to minimise the costs of the
restructuring and we are grateful for the contribution which Fundsmith has
agreed to make to those costs. The Board believes that the Scheme offers the
most flexible and competitive outcome for shareholders.
Change of accounting reference date
In light of the proposed restructuring, the Board resolved to change the
Company's accounting reference date from 31 December 2025 to 30 June 2026 and
announced that this interim report would be published.
Investment Performance
The Company's net asset value (NAV) per share total return for the period was
-1.8% compared with the +10.2% return from the MSCI World SMID Index.
The investment manager's review below details the factors driving the
performance of the portfolio, and the changes made to the Company's portfolio
over the year.
The Company's objective is to provide shareholders with long term growth in
value, and the Company's annualised NAV per share performance in the period
since inception to the end of December 2025 is +6.8% pa, compared with the
+8.6% pa return from the MSCI World SMID Index. The Company's investment
performance since inception in 2018 can broadly be split into two distinct
periods: strong performance from IPO until 2021, and then underperformance
since early 2022. This period of poor relative performance was a major
contributor to the persistent share price discount to net asset value.
Discount and Share Buybacks
The share price discount to NAV was 9.1% at the end of 2024, and despite the
continuation of the share buyback programme during 2025, averaged 10.3% during
the year up to 11 November 2025, the day prior to the announcement of the
proposed restructuring.
During 2025 the Board repurchased 23.1 million shares, bringing total
repurchases since April 2022 to 69.7 million, representing almost 40% of the
total shares in issue before the buyback programme began. This represents one
of the most proactive buy‑back campaigns in the investment trust sector in
recent years in both absolute and relative terms.
Since the announcement of the proposed restructuring of the Company, the Board
has ceased buybacks and the shares have traded at an average discount of 3.2%.
Results and Dividends
The Company's total loss after tax for the twelve months was £62.8 million
comprising a capital loss of £67.4 million and a revenue profit of £4.6
million.
The Company is required to pay a dividend in order to retain investment trust
tax status, and accordingly the Board announced, on 13 January 2026, an
interim dividend of 2.1 pence per share in respect of the 18-month period to
30 June 2026. The dividend will be paid on 20 February 2026 to shareholders on
the register on the record date of 23 January 2026.
Shareholder Engagement
The Company held its Annual General Meeting on 23 April 2025.
A General Meeting was held on 15 May 2025 at which shareholders approved the
resolution to give the Directors the ability to reduce the Company's share
premium account by £500 million to increase the Company's distributable
reserves that can be used to continue with the Company's share buyback
programme. The High Court confirmed the capital reduction on 10 June 2025,
with registration by Companies House on 13 June 2025.
A further General Meeting was held on 3 December 2025 at which shareholders
approved a new authority, replacing the prior authority, to repurchase up to
16,178,759 shares. This authority was granted after the announcement of the
proposed restructuring of the Company on 12 November and has not been
utilised.
Two General Meetings of the Company will be held on 10 February 2026 and 27
February 2026 at which shareholders will be asked to approve and implement the
Scheme. The Board unanimously recommends voting in favour of the resolutions
to be proposed.
Changes to Board Composition during 2025
I joined the Board on 28 January, taking over from Diana Dyer Bartlett as
Chair. Diana, who joined the Board as a non-executive director at the launch
of the Company in October 2018, and who served as Chair of the Audit Committee
until February 2022, and then as Chair of the Board until January 2025, did
not seek re-election at the AGM in April 2025.
Sarika Patel was also appointed to the Board as a non-executive director and
Chair of the Audit Committee on 3 July 2025.
Outlook
I am a firm believer in the value of investment trusts as savings vehicles
and, in general, they serve investors well, so the proposed conversion into an
OEIC is bittersweet. However, the Board's overriding responsibility is to act
in the best interests of shareholders, and we believe the proposed
restructuring represents the best available outcome for this Company. The
existing Smithson strategy is easily replicated in an open-ended fund, which
allows shareholders to buy and sell at NAV and thus eliminating the discount,
without materially altering the current investment approach.
Shareholders are encouraged to read the circular setting out the details of
the scheme of reconstruction and the documents relating to Smithson Equity
Fund before deciding what action you should take with respect to the options
to roll over into the Smithson Equity Fund or to receive cash for your
shareholding at net asset value less costs.
If the resolutions relating to the Scheme are approved by shareholders all
Directors will stand down on 27 February 2026, and a liquidator will be
appointed. My fellow directors and I would like to thank shareholders for
their support for the Company and the Board
Mike Balfour
Chairman
2 February 2026
Investment Manager's Review
Dear Fellow Shareholder,
The performance of Smithson Investment Trust ('Smithson'), along with
comparators, is laid out below. In 2025, the Net Asset Value per share (NAV)
of the Company decreased by 1.8% and the share price increased by 5.6%. Over
the same period, the MSCI World Small and Mid Cap Index ('SMID'), our
reference index, increased by 10.2%. We also provide the performance of UK
bonds and cash for comparison.
Inception to 31.12.25
Total Return 01.01.25 to Cumulative Annualised
31.12.25 % %
%
Smithson NAV(1) -1.8 +60.2 +6.8
Smithson Share Price +5.6 +56.7 +6.4
SMID Equities(2) +10.2 +80.9 +8.6
UK Bonds(3) +6.1 -1.3 -0.2
Cash(4) +4.2 +17.7 +2.3
(1) Source: Bloomberg, starting NAV 1000, net of fees.
(2) MSCI World SMID Index, £ Net, source: www.msci.com.
(3) Bloomberg Series-E UK Govt 5 - 10 yr Bond Index, source: Bloomberg
(4) £ Interest Rate, source: Bloomberg. Inception 19.10.18
It was certainly a year of two halves for Smithson, with the NAV outperforming
the reference index in the first half of the year, followed by significant
underperformance in the second half, dipping into negative territory in
December. It was extremely disappointing to observe the NAV drifting for six
months while the Index shot off like a rocket, causing NAV performance to fall
behind the Index since inception. The Smithson share price was up for the year
owing to a reduction in the share price discount to NAV, particularly
following the announcement to restructure the Company.
Impatient to understand the opportunities we had missed, we dissected the
market performance and discovered, to our unhappy bemusement, that according
to Bloomberg the median performance of the stocks in the Index of equal or
better quality to those in our portfolio (measured by returns on invested
capital, gross margin and free cash flow yield) was -4.1% in the second half
of the year. This compares to the median performance of the rest of the stocks
in the Index of +7.3%. We also discovered that performance became more
negative as the quality increased, and more positive as the companies became
less profitable. The share prices of loss-making companies were up by 18% on
average!
This suggests that the strategy of buying high quality small and
mid-capitalisation companies did not work this year. But while disappointing
in the short term, being so different from the market could prove to be useful
diversification for shareholders when this particular environment changes.
It is difficult to attribute the current market behaviour to any global
macroeconomic factor, with inflation, growth expectations and long-term
interest rates remaining relatively steady throughout the year. We therefore
have to assume that if the fundamentals aren't currently making sense, there
might be a degree of positive sentiment or speculation in specific areas of
the market that is affecting Index performance. This risk-taking mood isn't
pervasive throughout all markets, as weak cryptocurrency prices in the period
can attest, but instead appears concentrated in certain pockets, especially
those related to Artificial Intelligence (AI).
Looking at this area of the market we can see that the average price gain for
the top 100 AI exposed companies in the Index, (imperfectly determined by
taking the 100 companies which declined in price the most on the day in
January 2025 that the Large Language Model produced by the Chinese company
DeepSeek was unveiled), in the second half of the year, was 44%!
Having pored over this list for investment ideas earlier in the year, it
appeared that only three of them would currently meet the most basic
fundamental requirements for portfolio inclusion and the one we decided to
acquire, Vertiv Holdings, turned out to be the best performing of these, and a
strong contributor to the portfolio.
Vertiv, listed in the US, is a provider of customised liquid cooling and power
equipment for data centres and its shares were up 71% since we acquired it in
May. But Vertiv is not our only exposure to AI, or more specifically, capital
expenditures (capex) on AI data centres, as both Halma and Diploma also
generate revenue from this area. We also own an Italian IT consultancy
business called Reply, which is increasingly employed by large corporates to
integrate AI applications into their technology systems. All told, we estimate
that the portfolio has around a 5% weighting to AI-exposed companies, while
taking only the top 100 companies mentioned above would account for over 6% of
the reference index. It is therefore safe to assume that the portfolio is
still 'underweight' the AI theme.
Is this the correct position to have?
There are many signs that speculative activity is forming in this area, from
the share price performance of unprofitable companies, to AI start-ups
suddenly worth billions of dollars, to the circular financing arrangements of
some companies lending money to their AI customers to enable the further
purchases of their own products (because the AI companies are still
loss-making), to comments from leading protagonists including the CEOs of
OpenAI, Alphabet, and Palantir regarding observed speculative behaviour. To
give a sense of scale to AI capex, and pertinent to general fears that AI will
one day replace white collar workers, here's something to ponder: it is
expected that next year in the US, data centre construction will be greater in
value than office building construction for the first time.
So, is there a bubble here? Of course! It is almost certain that such fast
growing, potentially world‑changing technology investment will attract
excessively speculative behaviour. But at least it is a useful bubble - or
what Jeff Bezos, the founder of Amazon, calls an 'industrial bubble' - like
the Dotcom Bubble (2000) and Railway Mania (1840s), in that whatever happens
next to asset prices, at least we will be left with a useful technology to
benefit mankind. This contrasts with purely 'financial bubbles' such as those
for Dutch tulip bulbs (1630s), the South Sea Bubble (1720) or mortgage
derivatives before the 2008 Financial Crisis, which were simply speculating on
asset prices and otherwise useless.
The issue for most professional money managers is that these events can
continue for quite some time, typically fuelled by excitement regarding
technological promise and facilitated by loosening credit conditions, which
are now present. In fact, if the AI capex boom were to track the timeline of
the Dotcom Bubble (spoiler alert: it almost certainly won't), then we are only
in 1998, with at least two more years to go.
The key must be, therefore, to have some exposure, but only if we can own
companies that fit within our strategy, i.e. fulfilling all of our strict
quality criteria while benefiting from the structural growth that's being
driven by AI development or deployment, and being just as strict on valuation.
For example, when we acquired Vertiv Holdings, it had grown revenue by 29%
over the prior 12 months, yet it was trading on just 21x forward PE after the
share price had fallen owing to the US tariff announcements in April. But it
does mean that if share prices and valuations continue to increase at the
current rate, it is likely that our exposure to this theme will decrease over
the coming year, rather than increase.
Part of this risk control includes maintaining holdings of distinctly 'non-AI'
companies. At one end of this range is Clorox, a US consumer staples company
selling branded household goods from bleach to salad dressings. Its shares
typically perform well when the market suddenly decides that things aren't so
rosy anymore and it is now trading at a low valuation last seen briefly in the
aftermath of the Financial Crisis.
At the other end of the spectrum is our basket of holdings in software
companies, which the market currently fears will be negatively affected by the
general deployment of AI. This is because it is believed that they will have
to develop their own AI applications to avoid being replaced by an AI
start‑up, requiring both increased R&D spend up front as well as
additional ongoing computing costs to serve the customer use of these
applications, with limited opportunity for offsetting revenue generation.
Our current thinking is that these fears of displacement are likely overblown,
with our companies producing software that has high regulatory compliance
requirements or are automating critical workflows for their customers - from
distributing computing workload across cloud systems to payroll processing -
with integrated customer data increasing the barriers to replacement. The
costs of their AI product deployment are also likely overestimated due to
potential efficiency gains from the use of AI in their own operations, as well
as the fact that if people keep asking their software the same questions
(which they typically do), it doesn't require any computing power at all to
spit out the same previously composed answers. But hopefully we only need to
be roughly right, because most of these software companies are now trading at
all-time lows compared to historical valuations.
Our simple investment strategy, of buying good companies, not overpaying and
holding for as long as possible to allow our investments to compound in value,
has not changed. To demonstrate the quality of the companies held in the
portfolio, the table below outlining their average operating metrics shows
that they remain far superior to the average company in the Index. Changes to
the portfolio combined with improving operating metrics meant that Return on
Invested Capital increased to 31% from 26% in 2024.
LTM figures Smithson Investment Trust MSCI SMID
ROIC 31%(#) 6%
Gross Margin 64% 30%
Operating Profit Margin 25% 6%
Cash Conversion 99% 74%
Interest Cover 54x 6x
Source: Fundsmith
Data for the MSCI World SMID Cap Index is shown ex-financials, with weightings
as at 31.12.25
Data for MSCI World SMID Cap Index is on a weighted average basis, using last
available reported figures as at 31.12.25
Data for Smithson portfolio is on a weighted average basis, ex-cash, using
last available reported figures as at 31.12.25
Interest cover (EBIT ÷ net interest) data for Smithson and MSCI SMID is done
on a median average basis.
# Return On Invested Capital for Smithson excludes Verisign which now has a
negative balance of invested capital after share buybacks
In terms of valuation, the average neutral free cash flow yield (the free cash
flow excluding growth capital expenditure divided by the market
capitalisation) of the portfolio has increased to 3.7% from 3.3% in 2024. This
is close to the high recorded in December 2018 of 3.9% while, I would argue,
we have a higher quality and faster growing portfolio today. Even more
interesting is the fact that the cash flow yield for the SMID Index ended the
year at 3.3%, which marks the first time in our history that our portfolio of
high quality companies is cheaper than the Index. Over the last twelve months,
the growth in free cash flow for our companies was 10.4% on a weighted average
basis. This was lower than is typical due to large capital projects at some of
our companies. On a median basis, the growth was 20.3%, close to the 22%
median growth in 2024.
Trading activity, including new additions to the portfolio and exiting
positions, meant that discretionary portfolio turnover (excluding sales to
facilitate share buybacks) was 49% compared to 36% in 2024, a reflection of
the opportunities presented to us during the year. Worth noting then that the
share prices of companies we acquired during the year were up by 18% on
average from their respective entry points to year-end, while those companies
sold were down by 9% on average post their respective exit points. Without
taking these actions, things could have been worse.
Turnover remains below the average for actively managed equity funds, which is
above 60% according to Morningstar, while in a closed-end vehicle such as an
investment trust, it's worth remembering that capital has to be generated
first by selling part or all of an existing position to enable a new position
to be acquired, both of which count towards turnover. 49% turnover means that
around one quarter of the portfolio was changed (24.5% of the portfolio was
sold to acquire 24.5% of new holdings), indicating an average holding period
of 4 years. Over one third of the portfolio is still held in companies owned
since the inception of Smithson in 2018.
Importantly, costs of all dealing, including taxes, amounted to just 0.02% (2
basis points) of NAV in the period, lower than the 0.03% incurred in 2024. The
Ongoing Charge Figure was 0.90% of NAV, compared with 0.86% in 2024. This
includes the Management Fee of 0.9%, applied to the market capitalisation of
the Trust, which was lower than the NAV during the year. Combined, this means
the Total Cost of Investment in the Trust was 0.92% of NAV (2024: 0.89%).
Regarding portfolio changes, having explained the purchases during the first
six months of Doximity, Catalyst Pharmaceuticals, Vertiv Holdings, Manhattan
Associates and Napco Technologies and the sales of Addtech, Fevertree Drinks,
IDEX, Geberit and Equifax in the interim report, I shall focus my comments
here on those changes that were made in the second half of 2025.
Two further companies were acquired after the interim report, both in
December, which again highlights that very little activity can take place for
months at a time, with sporadic bouts of trading when opportunities present
themselves. Adma Biologics is a US-based healthcare company focusing on
primary immunodeficiency disease, a rare disease caused by a genetic mutation
that leads to deficiencies in the patient's immune system and affects around
250,000 people in the US. Adma produces treatments in the form of human
plasma-derived immunoglobulin products which are typically administered
intravenously and effectively replace the missing antibodies for the patient
for a limited period. As some patients are particularly susceptible to
respiratory diseases, the company has developed a plasma treatment with
concentrated doses of specific antibodies to combat these viruses. This is
unique in the market, as demonstrated by the potential treatment price for a
single patient of over $50,000 per month. The market is interesting in other
ways, notably the high barriers to entry for human plasma collection. A single
batch of plasma could require up to 10,000 donors, for which Adma has seven
plasma collection centres across the US, all of which have to be licensed by
the FDA, a process that can take 5-8 years. On top of this, the extensive
testing which is required for each batch means that the total time for
collection, manufacturing and testing of a single batch of immunoglobulin
product can be up to 12 months. Despite this difficult process, Adma's
operating margin last year was 33% with net profit growth of 27% and return on
invested capital of over 40%.
Nutanix is a US company that sells software which lets companies run
applications on servers in their own data centres as well as in public and
private clouds, all managed under one operating system. Despite the obvious
need for companies to seamlessly manage modern information technology
infrastructure across these different technology environments, the market for
this software is very concentrated, with Nutanix the number two player behind
the much larger VMware. The important point to understand here is that VMware
was recently acquired by Broadcom, which has a strategy of shedding smaller
clients from its newly acquired businesses to focus on only the largest and
highest value accounts. Nutanix management has identified around 100,000
VMware customers likely to be neglected, a potentially significant uplift to
its current customer base of around 30,000, and a growth tailwind likely to
last several years. Even without this, we would expect growth for Nutanix of
10% a year with an improving operating margin and returns on invested capital
above 40%.
Three companies were sold during the second half of the year. Having mentioned
in past reports the successful strategy of Verisk Analytics in divesting its
unprofitable non-core holdings to focus on its main insurance data business,
this appeared to take an abrupt U-turn when management announced the $2.35
billion acquisition of a company that provides management software for
residential property contractors. As this coincided with a FCF yield of 2.5%
for Verisk, close to its historical peak levels, we sold out of our entire
position the day after the announcement. From that day to the end of the year,
the shares were down 19%, which demonstrates that - as counterintuitive as it
sounds for a long-term investment strategy - value can still be added through
swift and correct action. Verisk is one company that we had held since
inception seven years ago, over which time the shares were up 151% to the
point of sale, a compound annualised return of 14.5%.
Exponent and Choice Hotels were both sold because of dissatisfaction with
business progress in combination with management discussions. Exponent is a
consulting business that focuses on scientific investigations into product
faults, typically for litigation defence. Revenue growth had been increasingly
lacklustre over recent years, decelerating from 16% in 2021 to 4% in 2024.
However, our greater concern was the long-term potential impact of AI on their
business, which is essentially billable per hour of consultant work. To our
dismay, the management team appeared somewhat blasé about such a threat,
which, in combination with a valuation below 3% FCF yield, prompted us to
sell.
Choice Hotels has also been struggling, given that a large proportion of its
hotels cater to low end US consumers which are suffering from a
cost-of-living-crisis. While we don't know how long this may last, and it
could be years, the further issue for us was the degree of obfuscation with
which management presented its underwhelming results. So, despite the shares
not being particularly expensive, we felt the capital would be better used
elsewhere. Indeed, Choice Hotel shares are down a further 22% since our exit.
To discuss the fund performance in more detail, let's start with the top five
detractors, which are shown below.
Security Country Contribution %
Sabre US -2.2%
Clorox US -1.6%
Paycom Software US -1.3%
Doximity US -0.9%
Choice Hotels US -0.9%
Source: Northern Trust
The worst performing stock in the portfolio was Sabre, the US travel software
company, which links travel buyers, such as online consumers and travel
agents, to travel sellers, such as airlines and hotels. This underperformance
is despite the industry increasingly becoming a duopoly as the third largest
player, Travelport, has struggled since its acquisition by private equity just
before Covid, which stopped almost all travel for a year. Sabre did not emerge
from that period unscathed, now being the only company in the portfolio with
meaningful levels of debt, but recent underperformance has likely been caused
by concerns regarding future industry bookings being conducted by AI agents
and not travel agents. It still appears that Sabre and Amadeus, the largest
players in the industry, will be required to provide the IT infrastructure to
enable these AI bookings and they have already launched AI booking agents of
their own to facilitate this. Adding to market concerns was a reduction in
travel volumes due to the US government shutdown in 2025, as US government
employees account for around 4% of Sabre's air distribution volumes.
At the other end of the scale, normally our least volatile stock, Clorox, was
this time one of our worst performers. This is for two reasons: first, that
sales of their consumer staples products have struggled due to the woes of the
low-end US consumer mentioned above, and second, the company has been burdened
with around $75m of additional costs related to the new US tariffs. Given that
the valuation of the shares is now approaching the lows seen in the financial
crisis, and I suspect they will perform well if the stock market loses its
speculative mood, I remain happy with its position in our portfolio.
Choice Hotels was another victim of subdued low-end US consumer spending, but
in this case we decided to exit the position, as outlined earlier.
Paycom is a US payroll software company and is likely another one of the
sufferers of AI deployment fears outlined above, although the shares have come
under further pressure because of weak US employment data, as their software
is charged on a per-employee basis. The company has already released an AI
interface for its software, allowing users to interact with it using natural
language as they would with ChatGPT, while all underlying data remains
proprietary to the customer. The management claims this is already
transforming the use of its software, and the fact that they own their own
data centre means that additional running costs for these AI applications are
reasonable.
Having started the year with extremely strong performance, shares in Doximity,
the professional network for US doctors (similar in concept to LinkedIn), sold
off in the last couple of months due to cautious guidance for revenue growth
given by management. This is somewhat frustrating, as management guided to
only 10% revenue growth, similar to their guidance over the last two years,
while the business has consistently produced mid-teens growth or better over
the same timeframe. We shall have to wait for the New Year to see the final
result for 2025, but at least the market is now only expecting what it has
been spoon-fed and, combined with a FCF yield approaching 4%, we estimate that
the risk of further downside is limited.The top five contributors to
performance are shown below.
Security Country Contribution %
Vertiv US 1.6%
Diploma UK 1.5%
Medpace US 1.1%
Halma UK 1.0%
Verisign US 0.7%
Source: Northern Trust
Vertiv was our best performing stock despite only owning it for a little over
six months. The shares performed poorly at the start of the year after the
DeepSeek announcement in January and the US tariff announcements in April.
After our acquisition in May, the shares rebounded strongly as several
companies continued to announce plans to build more data centres.
Diploma also performed well due to continued strong organic growth throughout
the year, in part supported by the exposure of some of its subsidiaries to AI
data centre construction.
Medpace is a US company which provides research and development as well as
drug trial services to small biotech companies. Share price performance had
been lacklustre since we acquired it roughly a year ago, as biotech funding
was still under pressure after the excesses experienced during Covid. However,
indications that orders were returning in its Q2 results announcement in July
sent the shares up 55% in one day, and they have increased further since.
Halma was another beneficiary of data centre construction, in this case
because of one customer - likely to be one of the so-called Magnificent Seven
- demanding 40% more of its photonics products this year for data centre
operations. This is a situation we are following closely, given the obvious
risk of decline in future orders from this customer.
Verisign is a company we have held since our inception due to the consistent
growth and extremely high margins afforded to its unique competitive position.
As the exclusive registry operator for the .com internet domain, its business
is reliant on a management contract from the Internet Corporation for Assigned
Names and Numbers (ICANN), the non-profit organisation that coordinates
internet domains and addresses. This contract is typically 6 years in length
and has a presumptive right of renewal, which means it will automatically
renew unless Verisign materially breaches the agreement by allowing an
internet outage or becoming insolvent. The first situation hasn't happened in
all 30 years of its operation and with the level of cash kept in the
business, the second situation is virtually impossible. I provide this detail
only to explain that the contract was practically guaranteed to be ratified
when it came up for renewal in November 2024, yet when it was duly extended
for another 6 years, the shares went on a +60% run.
The current positioning of the fund is shown below, with a breakdown of the
portfolio in terms of sector and geography at the end of the period. The
median year of foundation of the companies in the portfolio at the year-end
was 1981.
Sector 31 December 2025 31 December 2024
(%)
(%)
Information Technology 30 20
Industrials 29 42
Health Care 21 13
Consumer Discretionary 7 11
Consumer Staples 6 8
Financials 4 4
Materials 2 2
Cash 1 0
Source: Northern Trust
The weighting to the Industrials sector has decreased over the course of the
year due to the sale of IDEX, Geberit, Equifax, Verisk and Exponent, while
Information Technology primarily increased due to the acquisition of Manhattan
Associates and Nutanix. Healthcare also ended with a higher weighting with the
new positions in Catalyst Pharmaceuticals and Adma Biologics. The sale of
Choice Hotels accounted for most of the decrease in the Consumer Discretionary
weighting.
Region 31 December 2025 31 December 2024
(%)
(%)
USA 49 50
Italy 13 9
UK 13 16
Germany 7 7
Japan 3 2
Sweden 3 3
Denmark 3 3
New Zealand 3 4
Switzerland 2 5
Belgium 2 1
Cash - Uninvested 1 0
Source: Northern Trust
The USA is the largest country weighting and is little changed during the
year, remaining some way below the Index weighting of 60%. The exposure to the
UK has decreased after reducing the weighting of some of our biggest winners
of the year - Diploma and Halma - after those positions grew outsized relative
to potential upside. The positions in our Italy domiciled names, predominantly
Moncler and Recordati, increased through a combination of outperformance and
not being reduced to fund the Company's share buybacks.
The geographical weighting that we pay most attention to though is the
economic exposure of our companies, measured by the origin of revenue (below).
Source Of Revenue 31 December 2025 31 December 2024
(%)
(%)
North America 53 51
Europe 24 27
Asia Pacific 17 17
Eurasia, Middle East, Africa 4 3
Latin America 2 2
Source: Fundsmith
Here, not much has changed, with the revenue coming from North America
increasing slightly at the expense of revenue from Europe, which can be
accounted for by the trades described earlier.
In summary, we still own great companies while the portfolio is now the
cheapest it has ever been relative to the market. We continue to work
relentlessly to uncover attractively valued, high quality growing companies
that will one day become much larger, and potentially higher rated, than they
are today. The only silver lining of the recent performance is that this is
becoming easier by the day. Thank you once more for your patient support.
Simon Barnard
Fundsmith LLP
Investment Manager
2 February 2026
Investment Portfolio
Investments held as at 31 December 2025
Security Country of incorporation Fair value £'000 % of investments
Moncler Italy 99,469 5.8
Rational Germany 80,249 4.7
Recordati Italy 76,589 4.5
Spirax-Sarco Engineering UK 75,491 4.4
MSCI USA 71,097 4.2
Diploma UK 68,521 4.0
Rollins USA 65,970 3.9
Qualys USA 63,950 3.8
Paycom Software USA 61,985 3.7
Oddity Israel 61,914 3.6
Top 10 Investments 725,235 42.6
Catalyst Pharmaceuticals USA 58,320 3.4
Napco Security Technologies USA 55,193 3.3
Doximity USA 54,307 3.2
Monotaro Japan 54,283 3.2
Nutanix USA 52,924 3.1
Reply Spa Italy 52,275 3.1
HMS Networks AB Sweden 50,825 3.0
Halma UK 50,713 3.0
Ambu Denmark 50,210 3.0
Fisher & Paykel Healthcare New Zealand 49,552 2.9
Top 20 Investments 1,253,837 73.8
Vertiv USA 49,473 2.9
Verisign USA 48,869 2.9
Clorox USA 45,995 2.7
Nemetschek Germany 45,601 2.7
Manhattan Associates USA 37,122 2.2
Graco USA 35,291 2.1
Medpace USA 34,461 2.0
Inficon Switzerland 32,487 1.9
Croda UK 32,417 1.9
Melexis Belgium 32,180 1.9
ADMA Biologics USA 28,506 1.7
Sabre USA 21,738 1.3
Total Investments 1,697,977 100.0
Investment Objective and Policy
Investment Objective
The Company's investment objective is to provide shareholders with long term
growth in value through exposure to a diversified portfolio of shares issued
by listed or traded companies.
Investment Policy
The Company's investment policy is to invest in shares issued by small and
mid-sized listed companies globally that (at the time of initial investment)
have a market capitalisation within the range of the constituents of the MSCI
World SMID Index. The Company's approach is to be a long-term investor in its
chosen shares. It will not adopt short-term trading strategies. Accordingly,
it will pursue its investment policy by investing in approximately 25 to 40
companies as follows:
(a) the Company can invest up to 10 per cent. in value of its gross
assets (as at the time of investment) in shares issued by any single body;
(b) not more than 20 per cent. in value of its gross assets (as at the
time of investment) can be in deposits held with a single body. This limit
will apply to all uninvested cash (except cash representing distributable
income or credited to a distribution account that the depositary holds);
(c) not more than 20 per cent. in value of its gross assets (as at the
time of investment) can consist of shares issued by the same group. When
applying the limit set out in (a) this provision would allow the Company to
invest up to 10 per cent. in the shares of two group member companies (as at
the time of investment);
(d) the Company's holdings in any combination of shares or deposits
issued by a single body must not exceed 20 per cent. in value of its gross
assets (as at the time of investment);
(e) the Company must not acquire shares issued by a body corporate and
carrying rights to vote at a general meeting of that body corporate if the
Company has the power to influence significantly the conduct of business of
that body corporate (or would be able to do so after the acquisition of the
shares).
The Company is to be taken to have power to influence significantly if it
exercises or controls the exercise of 20 per cent. or more of the voting
rights of that body corporate; and
(f) the Company must not acquire shares which do not carry a right to
vote on any matter at a general meeting of the body corporate that issued them
and represent more than 10 per cent. of the shares issued by that body
corporate.
The Company may also invest cash held for working capital purposes and
awaiting investment in cash deposits and money market funds.
For the purposes of the investment policy, certificates representing certain
shares (for example, depositary interests) will be deemed to be shares.
Hedging Policy
The Company will not use portfolio management techniques such as interest rate
hedging and credit default swaps.
The Company will not use derivatives for purposes of currency hedging or for
any other purpose.
Borrowing Policy
The Company has the power to borrow using short-term banking facilities to
raise funds for short-term liquidity purposes or for discount management
purposes including the purchase of its own shares, provided that the maximum
gearing represented by such borrowings shall be limited to 15 per cent. of the
net asset value at the time of drawdown of such borrowings. The Company may
not otherwise employ leverage.
Interim Management Report
The Directors are required to provide an Interim Management Report in
accordance with the FCA's Disclosure Guidance and Transparency Rules. The
Directors consider that the Chairman's Statement and the Investment Manager's
Review of the Interim Report respectively, provide details of the important
events which have occurred during the period and their impact on the condensed
set of financial statements. The following statements on principal risks and
uncertainties, related party transactions and the Directors' responsibility
statement below, together constitute the Interim Management Report for the
Company for the period from 1 January 2025 to 31 December 2025.
Principal Risks and Uncertainties
The Board considers that the principal risks and uncertainties faced by the
Company can be summarised as (i) investment objective and policy risk, (ii)
market risks, (iii) outsourcing risks, (iv) key individuals' risk, (v)
regulatory risks and (vi) the failure or delay of the Scheme of
Reconstruction. A detailed explanation of risks and uncertainties of (i)
through (v) can be found on pages 19 to 22 of the Company's most recent Report
and Accounts for the year ended 31 December 2024. With regard to the failure
or delay of the Scheme of Reconstruction the Board note that FCA approval of
the open ended investment company has been received and that, therefore, the
risk is that the Scheme does not receive the approval of shareholders. The
Board believe that it is likely, if the Scheme is not approved by
shareholders, that the share price discount to net asset value would increase
and that share liquidity would likely also be reduced. The Board also
considers the risks associated with the macroeconomic backdrop such as
uncertainty over inflation, higher interest rates, possibility of a recession
and the continuing war in Ukraine. The Board monitors the potential risks to
the Company and its portfolio and receives regular updates and assurance from
the Investment Manager and other key service providers on operational
resilience and portfolio exposure and impact.
A review of the period and the outlook can be found in the Chairman's
Statement and in the Investment Manager's Review.
Related Party Transactions
The Company's Investment Manager, Fundsmith LLP, is considered a related party
in accordance with the Listing Rules. There have been no changes to the nature
of the Company's related party transactions since the Company's most recent
Report and Accounts for the period ended 31 December 2024 were released.
Details of the amounts paid to the Company's Investment Manager and the
Directors during the period are detailed in the notes to the financial
statements.
Directors' Responsibility Statement
The Directors confirm to the best of their knowledge that:
● 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 twelve 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 financial year); and
● the Interim Financial Statements includes a fair review of the
information required by Disclosure and Transparency Rule 4.2.8R (disclosure of
related party transactions and changes therein).
On behalf of the Board of Directors
Mike Balfour
Chairman
2 February 2026
Condensed Statement of Comprehensive Income (Unaudited)
Unaudited Audited Year ended
Twelve months ended
31 December 2024
31 December 2025
Revenue Capital Total Revenue Capital Total
Notes £'000 £'000 £'000 £'000 £'000 £'000
Income from investments held at fair value through profit or loss 4 24,716 - 24,716 28,699 - 28,699
Losses on investments held at fair value through profit or loss 3 - (66,877) (66,877) - (11,179) (11,179)
Foreign exchange losses (30) (179) (209) (72) (668) (740)
Investment management fees (15,859) - (15,859) (18,505) - (18,505)
Other expenses and transaction costs (1,529) (418) (1,947) (1,546) (636) (2,182)
Profit/(loss) before tax 7,298 (67,474) (60,176) 8,576 (12,483) (3,907)
Tax (2,663) - (2,663) (4,205) - (4,205)
Profit/(loss) for the period 5 4,635 (67,474) (62,839) 4,371 (12,483) (8,112)
Profit/(loss) per share (basic and diluted) (p) 5 3.97 (57.77) (53.80) 3.00 (8.57) (5.57)
The Company does not have any income or expenses which are not included in the
profit for the period.
All of the profit and total comprehensive income for the period is
attributable to the owners of the Company.
The "Total" column of this statement represents the Company's Income
Statement, prepared in accordance with International Financial Reporting
Standards ("IFRS"). The "Revenue" and "Capital" columns are supplementary to
this and are prepared under guidance published by the Association of
Investment Companies ("AIC").
All items in the above statement derive from continuing operations.
The accompanying notes are an integral part of these financial statements.
Condensed Statement of Financial Position (Unaudited)
Unaudited Audited
As at As at
31 December 31 December
2025 2024
Notes £'000 £'000
Non-current assets
Investments held at fair value through profit or loss 3 1,697,977 2,127,041
Current assets
Trade and other receivables 720 5,080
Cash and cash equivalents 23,406 3,036
24,126 8,116
Total assets 1,722,103 2,135,157
Current liabilities
Trade and other payables (1,628) (5,260)
Total assets less current liabilities 1,720,475 2,129,897
Equity attributable to equity shareholders
Share capital 7 1,771 1,771
Share premium 1,219,487 1,719,487
Capital reserve 494,522 407,893
Revenue reserve 4,665 746
Total equity 1,720,475 2,129,897
Net asset value per share (p) 6 1,601.5 1,631.8
The accompanying notes are an integral part of these financial statements.
Condensed Statement of Changes in Equity (Unaudited)
For the twelve months ended 31 December 2025
Share Share Capital Revenue
Capital Premium Reserve Reserve Total
£'000 £'000 £'000 £'000 £'000
Balance at 1 January 2025 1,771 1,719,487 407,893 746 2,129,897
Ordinary shares bought back into treasury - - (343,892) - (343,892)
Costs on buybacks - - (1,927) - (1,927)
Transfer of share premium(#) - (500,000) 500,000 - -
Expenses in relation to share premium transfer - - (48) - (48)
Equity dividends paid - - - (716) (716)
(Loss)/profit for the period - - (67,474) 4,635 (62,839)
Balance at 31 December 2025 1,771 1,219,487 494,522 4,665 1,720,475
(#) On 13 June 2025, High Court approval was obtained to reduce the
Company's share premium by £500 million. The capital reduction, resulted in a
corresponding increase in the Company's distributable reserves.
For the year ended 31 December 2024 (Audited)
Share Share Capital Revenue
Capital Premium Reserve Reserve Total
£'000 £'000 £'000 £'000 £'000
Balance at 1 January 2024 1,771 1,719,487 834,305 (3,625) 2,551,938
Ordinary shares bought back into treasury - - (411,747) - (411,747)
Costs on buybacks - - (2,182) - (2,182)
(Loss)/profit for the period - - (12,483) 4,371 (8,112)
Balance at 31 December 2024 1,771 1,719,487 407,893 746 2,129,897
The accompanying notes are an integral part of these financial statements.
Condensed Statement of Cash Flows (Unaudited)
Unaudited
Twelve months Audited
ended Year ended
31 December 31 December
2025 2024
Notes £'000 £'000
Operating activities
Loss before tax (60,176) (3,907)
Adjustments for:
Losses on investments held at fair value through profit or loss 3 66,877 11,179
Increase in receivables (106) (242)
Increase/decrease in payables 4 (230)
Overseas taxation (2,663) (4,205)
Net cash generated from operating activities 3,936 2,595
Investing activities
Purchase of investments 3 (467,859) (423,193)
Sale of investments 3 834,512 819,465
Net cash generated from investing activities 366,653 396,272
Financing activities
Purchase of shares held in treasury (347,528) (410,228)
Costs relating to buy backs (1,927) (2,182)
Expenses in relation to share premium transfer (48) -
Equity dividends paid (716) -
Net cash used in financing activities (350,219) (412,410)
Net increase/(decrease) in cash and cash equivalents 20,370 (13,543)
Cash and cash equivalents at start of the period/year 3,036 16,579
Cash and cash equivalents at end of the period/year 23,406 3,036
Comprised of:
Cash at bank 23,406 3,036
The accompanying notes are an integral part of these financial statements.
Notes to the Condensed Financial Statements (Unaudited)
1. General information
Smithson Investment Trust plc is a company incorporated on 14 August 2018 in
the United Kingdom under the Companies Act 2006.
The condensed interim financial statements have been prepared in accordance
with IAS 34 Interim Financial Reporting and the Disclosure Guidance and
Transparency Rules ("DTRs") of the UK's Listing Authority. On 3 December 2025
the Company released an announcement confirming the decision to amend its
accounting reference date to 30 June. In accordance with this change this
report is the second interim report required by the Listing Rules due to the
Company's year-end being extended to 30 June 2026.
Principal activity
The principal activity of the Company is that of an investment company within
the meaning of Section 833 of the Companies Act 2006.
The Company commenced activities on admission to the London Stock Exchange on
19 October 2018.
Going concern
Shareholders will be aware of the Board's proposal to restructure the Company
into an open-ended vehicle and provide a cash exit to shareholders, as
desired, first detailed in the proposal dated 12 November 2025, again in the
circular dated 22 January 2026 and elsewhere in this Interim Report.
Given the progress made towards executing this proposal and the support of
significant shareholders, the Board considers it likely that the proposal will
be approved by shareholders at the General Meeting on 10 February 2026. As
such it is the Board's expectation that the Company will be placed into
voluntary liquidation in February 2026.
Accordingly, the Board has considered carefully the basis of preparation of
these interim financial statements. In view of the anticipated restructuring
and consequent division of net assets between rollover and exiting
shareholders it has concluded that the most appropriate and relevant
preparation basis is a liquidation basis as this matches the requirements of
the anticipated restructuring proposal.
The Board applied the liquidation basis by considering what changes, if any,
would be required to the financial statements that were prepared initially on
a going concern basis. This exercise consisted of examining the recoverability
and valuation of each asset recorded on the Balance Sheet as well as the
valuation and payment schedule of liabilities. The results showed that the
changes required to adjust from a going concern basis to a liquidation basis
are wholly insignificant valuation adjustments.
Furthermore, as no assets or liabilities required reclassification, these very
minor valuation changes have not been reflected in this report.
In the unlikely event that the restructuring proposal does not receive
sufficient shareholder support, the Company invests in liquid assets and is
able to meet its ongoing financial commitments as they fall due.
2. Significant accounting policies
The Company's accounting policies are set out below:
Accounting convention
The interim financial statements have been prepared under the historical cost
convention (modified to include investments at fair value through profit or
loss), on a liquidation basis and in accordance with UK adopted international
accounting standards in conformity with the requirements of the Companies Act
2006 and IFRSs as issued by the International Accounting Standards Board
("IASB") and with the Statement of Recommended Practice ("SORP") 'Financial
Statements of Investment Trust Companies and Venture Capital Trusts' issued by
the Association of Investment Companies ("AIC") in November 2014 (and updated
in July 2022). They have also been prepared on the assumption that approval as
an investment trust will continue to be granted.
The accounting policies in this Interim Report are consistent with those
applied in the Annual Report for the year ended 31 December 2024 and have been
disclosed consistently and in line with the Companies Act 2006.
Critical accounting judgements and sources of estimation uncertainty
The Board confirms that no significant accounting judgements or estimates have
been applied to the financial statements other than the basis of preparation
which is discussed above. Therefore there is not a significant risk of a
material adjustment to the carrying amounts of assets and liabilities arising
from estimations or judgements.
3. Investments held at fair value through profit or loss
Unaudited
Twelve months Audited
ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Opening book cost 1,941,263 2,232,394
Opening investment holding gains 185,778 306,559
Opening fair value at start of the period/year 2,127,041 2,538,953
Purchases at cost 467,859 421,719
Sales - proceeds (830,046) (822,452)
Losses on investments (66,877) (11,179)
Closing fair value at end of the period/year 1,697,977 2,127,041
Closing book cost at end of the period/year 1,738,672 1,941,263
Closing unrealised gain at end of the period/year (40,695) 185,778
Valuation at end of the period/year 1,697,977 2,127,041
The Company received £830,046,000 excluding transaction costs from
investments sold in the period (31 December 2024: £822,452,000). The book
cost of the investments when they were purchased was £670,868,000 (31
December 2024: £713,486,000). These investments have been revalued over time
until they were sold and unrealised gains/losses were included in the fair
value of the investments.
All investments are listed.
4. Dividend income
Unaudited
Twelve months Audited
ended Year ended
31 December 31 December
2025 2024
£'000 £'000
UK dividends 5,180 5,865
Overseas dividends 19,270 22,165
Overseas dividends - special 121 75
Bank interest 145 594
Total 24,716 28,699
5. Loss per share
Loss per ordinary share is as follows:
Unaudited Audited
Twelve months ended Year ended
31 December 2025 31 December 2024
Revenue Capital Total Revenue Capital Total
Profit/(loss) for the period/year (£'000) 4,635 (67,474) (62,839) 4,371 (12,483) (8,112)
Profit/(loss) per ordinary share (p) 3.97 (57.77) (53.80) 3.00 (8.57) (5.57)
Return per share is calculated based on returns for the period and the
weighted average number of 116,798,035 shares in issue (excluding treasury
shares) in the twelve months ended 31 December 2025 (31 December 2024:
145,572,236).
6. Net asset value per share
Unaudited Audited
31 December 31 December
2025 2024
Net asset value £1,720,475,000 £2,129,897,000
Shares in issue 107,427,483 130,527,069
Net asset value per share 1,601.5p 1,631.8p
7. Share capital
Unaudited
31 December 2025
Ordinary Treasury Total Nominal
Shares Shares Shares Value
Issued, allotted and fully paid (ordinary) Number Number Number £'000
Ordinary shares in issue at 1 January 130,527,069 46,580,889 177,107,958 1,771
Ordinary shares bought back and held in treasury (23,099,586) 23,099,586 - -
107,427,483 69,680,475 177,107,958 1,771
Audited
31 December 2024
Ordinary Treasury Total Nominal
Shares Shares Shares Value
Issued, allotted and fully paid (ordinary) Number Number Number £'000
Ordinary shares in issue at 1 January 159,692,958 17,415,000 177,107,958 1,771
Ordinary shares bought back and held in treasury (29,165,889) 29,165,889 - -
130,527,069 46,580,889 177,107,958 1,771
During the twelve months ended 31 December 2025, the Company issued no
ordinary shares of £0.01 each (31 December 2024: nil).
During the twelve months ended 31 December 2025, the Company bought back to
hold in treasury 23,099,586 shares (31 December 2024: 29,165,889) at a total
cost of £345,819,000 (31 December 2024: £413,929,000). At the period end,
the Company held 69,680,475 (31 December 2024: 46,580,889) shares in treasury.
Since 31 December 2025 there have been no shares bought back.
8. Related party transactions
Fees payable to the Investment Manager are shown in the Condensed Statement of
Comprehensive Income. As at 31 December 2025 the fee outstanding to the
Investment Manager was £1,294,000 (31 December 2024: £1,430,000).
Fees are payable at an annual rate of £60,000 to the Chair of the Board,
£50,000 to the Chair of the Audit Committee, £40,000 to the Chair of the
Management Engagement Committee and £36,000 to other Directors. Diana Dyer
Bartlett resigned on 23 April 2025 and Sarika Patel was appointed as a
non-executive Director and Chair of the Audit Committee with effect from 3
July 2025. The remuneration for the Chair of the Audit Committee was set at
£50,000 with effect from that date.
In line with the Directors Remuneration policy and the comparative reference
information utilised by the Board of Directors, the annual fees payable to the
Directors with effect from 1 January 2026 have been set at £66,000 to the
Chair, £55,000 to the Chair of the Audit Committee, £44,000 to the Chair of
the Management Engagement Committee and £39,360 to other Directors.
The Directors had the following shareholdings in the Company.
As at As at
31 December 31 December
Director 2025 2024
Mike Balfour 7,000 -
Jeremy Attard-Manche 2,500 2,500
Denise Hadgill 2,578 2,578
Sarika Patel - -
As at 31 December 2025, Terry Smith and other partners and key employees of
the Investment Manager directly or indirectly and in aggregate, held 3.04% of
the issued share capital of the Company (31 December 2024: 2.30%).
9. Events after the reporting period
The Company is required to pay a dividend in order to retain investment trust
tax status, and accordingly the Board announced, on 13 January 2026, an
interim dividend of 2.1 pence per share in respect of the 18-month period to
30 June 2026. The dividend will be paid on 20 February 2026 to shareholders on
the register on the record date of 23 January 2026.
On 22 January 2026 a circular was published notifying shareholders of two
general meetings to be held on 10 February 2026 and 27 February 2026. The
circular set out the details of the Company's conversion into an open-ended
investment company ("OEIC") and the proposals to be put to shareholders at
these general meetings in order to implement a Scheme of Reconstruction.
Details of the Scheme are contained on the Company's website at
www.smithson.co.uk/restructure-proposal.
Since the date of this report, FCA approval for the open ended investment
company and its prospectus has been received.
10. Status of this report
These interim financial statements are not the Company's statutory accounts
for the purposes of section 434 of the Companies Act 2006. They are unaudited.
The Interim Report will be made available to the public at the registered
office of the Company. The report will also be available in electronic format
on the Company's website, http://www.smithson.co.uk.
The financial information for the year ended 31 December 2024 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 and did
not contain statements under sections 498 (2) or (3) of the Companies Act
2006.
The Interim Report was approved by the Board of Directors on 30 January 2026.
Alternative Performance Measures ("APMs")
APMs are often used to describe the performance of investment companies
although they are not specifically defined under IFRS. APM calculations for
the Company are shown below. The Board believes that each of the APMs, which
are typically used within the investment trust sector, provide additional
useful information to shareholders in order to assess the Company's
performance between reporting periods and against its peer group.
Discount
The amount, expressed as a percentage, by which the share price is less than
the NAV per ordinary share.
As at As at
31 December 31 December
2025 2024
NAV per ordinary share a 1,601.5p 1,631.8p
Share price b 1,566.0p 1,484.0p
Discount (b-a)÷a 2.2% 9.1%
Total return
A measure of performance that includes both income and capital returns. In the
case of share price total return, this takes into account share price
appreciation and dividends paid by the Company. In the case of NAV total
return, this takes into account NAV appreciation (net of expenses) and
dividends paid by the Company.
Twelve months ended 31 December 2025 Share price NAV
Opening at 1 January 2025 a 1,484.0p 1,631.8p
Closing at 31 December 2025 b 1,566.0p 1,601.5p
Increase 5.5% (1.9)%
Impact of reinvested dividends(*) 0.1% 0.1%
Total return (b÷a)-1 5.6% (1.8)%
Twelve months ended 31 December 2024 Share price NAV
Opening at 1 January 2024 a 1,415.0p 1,598.0p
Closing at 31 December 2024 b 1,484.0p 1,631.8p
Total return (b÷a)-1 4.9% 2.1%
Ongoing charges ratio and total cost of investment
A measure, expressed as a percentage of average NAV, of the regular, recurring
annual costs of running an investment company. The Total Cost of Investment
measures cost to investors incurred through the Company's portfolio
transaction costs and the recurring annual costs of running the Company.
Period from
Company's
listing on
Twelve months Twelve months 19 October
ended ended 2018 to
31 December 31 December 31 December
2025 2024 2025
Average NAV (£'000) a 1,938,149 2,319,112 2,123,687
Annualised expenses (£'000) b 17,388 20,051 19,655
Ongoing charges ratio (b÷a) 0.90% 0.86% 0.93%
Annualised investment transaction costs (£'000) c 418 636 667
Annualised investment transaction costs ratio (c÷a) 0.02% 0.03% 0.03%
Total Cost of Investment ratio 0.92% 0.89% 0.96%
Company Secretary & Registered Office
Apex Listed Companies Services (UK) Limited
4th Floor
140 Aldersgate Street
London
EC1A 4HY
For further information please contact the company secretary at:-
Email: smithsoncosecmailbox@apexgroup.com
(mailto:smithsoncosecmailbox@apexgroup.com)
Phone: +44 20 3994 7161
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