## Personal Assets Trust plc ## Annual Report ### For the year ended 30 April 2024 ### Patplc.co.uk 1 About Personal Assets Trust plc Our policy is to protect and increase (in that order) the value of shareholders’ funds per share over the long term. What We Do Personal Assets Trust plc (the ‘Company’) is what its name implies. It is an investment trust run for private investors, who range from first time savers to experienced investors, many of whom have entrusted a significant part of their portfolio to the Company. Our Approach From its inception, the Company has sought to emphasise capital preservation and absolute returns. It is conservatively managed, with low portfolio turnover. It takes a long-term, long-only approach and has the flexibility to invest in a broad range of asset classes – primarily developed market equities and bonds, gold-related investments, and also cash and short-dated treasury bills. Dividend Policy The Company aims to pay as consistent and sustainable a dividend as is compatible with protecting and increasing the value of its shareholders’ funds per share and maintaining its investment flexibility. Dividends are paid in January, April, July and October of each year. Investment Manager The Company has appointed Troy Asset Management (‘Troy’) as its Investment Manager and is managed by Sebastian Lyon with the assistance of Charlotte Yonge and the help of Troy’s wider investment team. Discount Management The Company’s discount and premium control policy is enshrined in its Articles of Association. The Company’s policy is to ensure that its shares always trade close to net asset value. This is achieved through a combination of share buybacks at a small discount to net asset value or the issue of shares at a small premium to net asset value where demand exceeds supply. The Board The Company is overseen by an independent Board of non-executive Directors. Our Board members and Managers are significant shareholders in the Company. Share Price Performance Versus RPI and CPI Since 30 April 1990 GRAPH 2 Contents Overview Key Features 2 Record 1990 – 2024 3 Chairman’s Statement 4 Investment Manager’s Report 6 Portfolio 8 Geographic Analysis of Investments and Currency Exposure 9 Contribution to Performance 9 Ten Year Performance 10 Annual Performance since 30 April 2000 11 Volatility and Share Price Total Return Performance since 30 April 2000 11 The Board 12 Strategic Report 14 Governance Report Responsible Investment 20 Directors’ Report 22 Corporate Governance 26 Directors’ Remuneration Report 30 Report of the Audit and Risk Committee 33 Independent Auditor’s Report 35 Financial Statements Income Statement 43 Statement of Financial Position 44 Statement of Changes in Equity 45 Cash Flow Statement 46 Notes to the Accounts 47 Notice of Annual General Meeting 60 Shareholder Information Glossary of Terms and Alternative Performance Measures 64 Corporate Information 66 3 Key Features (All figures at 30 April) (2) (2) (4) (4) (4) (4) (2) (3) (3) (4) (4) (4) (4) (1) The Company became self-managed in 1990. (2) Alternative Performance Measure. Please see pages 64 and 65 for a glossary of terms and definitions. (3) In addition a special dividend of 1.60p per Ordinary share will be paid in relation to the year ended 30 April 2024 (2023: special dividend of 2.10p per Ordinary share). (4) Adjusted for the 100 for one share split of the Ordinary shares on 1 August 2022. (1) (1) The Company became self-managed in 1990. (2) Alternative Performance Measure. Please see pages 64 and 65 for a glossary of terms and definitions. 4 | Share Price Relative to FTSE All- Share Price Total Return relative to Share Price Total Return relative to Share Price Total Return relative to | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | (Discount)/Premium to Ordinary Dividend per Revenue Return per | UK Index-Linked Net current | | Since | | | | | | | Property | | | (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (1) | (2) (2) (2) | (2) | (2) | | FTSE All-Share Index FTSE All-Share Index Share Retail Price Index (RPI) CPI Share Price NAV per Share Share Price Total Return NAV per Share Total Return Consumer Price Index (CPI) FTSE All-Share Total Return FTSE All-Share Total Return RPI Percentage Changes Market Capitalisation Shareholders’ Funds Shares Outstanding Allocation of Portfolio Share Price NAV per Share NAV Share Share Ongoing Charges 323,292,900 239,227,500 171,744,700 14,931,300 | 342,325,372 391,570,200 Equities US TIPS US Treasuries Bonds UK Gilts UK T-Bills Gold Bullion UK Cash Overseas Cash (liabilities)/assets £1,653.4m £1,883.5m £1,522.7m £1,667.3m £1,884.4m £1,503.9m 471.00p 408.00p 331.90p 465.19p 404.88p 333.77p | 1,122.8 2,247.0 1,441.4 1,298.8 £976.0m £570.0m £968.6m £573.2m 39.50p 56.67p 4,430.25 4,283.83 3,983.85 4,067.98 3,619.83 1,043.16 483.00p 481.00p 487.05p 481.23p (30.3%) 10 Years 4.53p 4.97p 4.78p 1.09p 5.60p 5.60p 5.60p 5.60p 5.60p 1.00p (11.8) (13.6) (16.3) 3 Years 5 Years 324.7 187.9 207.8 869.4 759.5 142.1 662.5 (0.3%) (0.1%) (0.1%) (0.8%) (0.0%) (0.6%) | £5.9m £8.5m 27.5% 24.0% 45.7% 36.0% 44.0% 88.2% 36.5% 33.9% 32.6% 27.8% 16.6% 11.6% 14.8% 13.6% 18.7% 12.5% 10.7% 19.2% 0.65% 0.65% 0.73% 0.80% 0.86% 2.00% 1 Year (2.9) (7.8) (0.3) (5.0) (2.6) (4.5) (1.2) (5.2) 1990 1990 8.77p 9.48p 11.2 22.4 18.9 27.9 33.6 50.6 25.9 18.4 45.5 20.3 45.9 26.7 67.9 28.7 68.3 21.3 24.1 33.4 23.9 30.1 75.8 67.8 11.5 3.8% 3.3% 3.3% 4.6% 7.0% 8.1% 9.5% 8.9% 8.1% 0.1% 0.1% 0.1% 1.8% 2.6% 4.7% 2.4% 5.7% 0.0% 0.0% 0.0% 0.0% 1.5% 4.9% 6.1% 1.2% 0.8% 2024 2023 2021 2019 2014 3.4 8.9 8.7 3.3 2.1 0.4 2.5 1.2 4.7 2.1 7.0 1.3 9.2 2.4 7.5 | – – – – – – – – – – – – – – – – – – – – – | | | | Record 1990-2024 | holders’ | | | | value | Share | | FTSE | Earnings | | dividend | Dividend | | Inflation | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | (1) | | | (2) | | | Funds | Liquidity | Shares | per share | | Price | All-Share | | per share | | per share | Growth | | (RPI) | April * Shares outstanding and per share values have been adjusted for the 1 for 100 consolidation of Ordinary shares in January 1993, the 100 for one share split of the Ordinary shares in August 2022 and exclude shares held in Treasury. (1) Based on the weighted average number of shares in issue during the year. (2) Excludes special dividends. (3) Personal Assets became self-managed in 1990. (4) In addition a special dividend of 1.60p per Ordinary share will be paid in relation to the year ended 30 April 2024 (2023: 2.10p; 2022: 1.40p*). (5) Capital only. 5 Ordinary Net asset Share- Date (3) 7 9 7 4 (4) (4) (4) (5) (5) (5) (2) 1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 10 Years 30 1990 1991 1993 1994 1996 1997 1999 2000 2002 2003 2006 2009 2011 2012 2014 2015 2017 2018 2020 2021 2023 2024 3 Years 5 Years Since 30 April 1990 2005 2008 Compound growth rates per annum 168,590,100 174,484,200 239,227,500 368,806,900 138,065,900 171,744,700 174,295,600 196,012,700 221,243,300 272,300,300 323,292,900 391,570,200 342,325,372 1,814,360 1,160,966 1,503,936 1,884,352 1,667,281 14,931,300 15,218,700 27,025,000 37,675,000 64,125,300 72,692,100 81,528,100 14,931,300 14,931,300 15,218,700 15,218,700 16,917,300 20,811,400 32,396,600 36,912,100 45,447,200 55,992,500 73,923,400 74,523,100 98,480,300 67,718,500 73,305,100 Outstanding* 1,282.75 1,578.67 2,788.99 2,869.04 2,237.34 3,355.60 2,863.35 3,390.18 3,421.70 4,067.98 4,185.12 1,043.16 1,202.75 1,388.88 1,580.44 1,914.61 2,135.31 3,028.40 3,001.92 2,512.04 1,891.50 3,074.26 2,173.06 3,155.03 2,984.67 3,619.83 3,760.06 3,962.49 4,127.68 3,262.51 3,983.85 4,283.83 4,430.25 2,397.05 3,099.94 (£’million) 134,770 192,416 233,785 593,245 640,624 968,579 104,324 189,351 171,132 310,000 463,473 573,237 609,745 781,499 858,893 149,834 188,664 100.2 10,589 13,939 48,702 180.21 78,000 207.03 210.17 264.70 286.75 351.89 367.15 404.88 491.95 11,441 12,987 19,473 115.11 27,865 133.89 65,200 201.26 73,751 199.80 92,430 203.38 186.32 256.14 229.64 314.78 335.69 340 333.77 331 349.83 350 398.70 405 388.21 426.36 465.19 481.23 487.05 221.26 257.37 34.7 47.1 31.4 50.7 34.4 56.5 56.0 64.0 62.2 5.60 11.8 12.0 15.9 24.5 37.8 45.3 2.62½ 48.9 24.5 40.8 29.9 45.4 50.0 56.0 59.9 54.3 61.6 55.3 54.3 76.0 5.60 72.5 5.60 35.4 70.92 91.59 199½ 208½ 214½ 289½ 372½ 8,462 56.67 9,006 60.32 75.18 85.34 118½ 141¼ 202½ 209½ 193¾ 259¼ 224¾ 258¼ 0.0 6.2 2.6 2.7 (1.2) (%) Index (%) (%) (%) (%) 1.67 1.60 2.00 2.00 3.57 2.45 3.27 2.70 3.98 3.10 4.95 4.10 10.8 4.61 5.20 5.69 5.60 4.78 5.60 4.97 5.60 8.36 11.1 39½ 1.09 1.00 48½ 1.45 1.50 50.0 81½ 2.52 1.80 12.5 89½ 2.12 1.95 2.90 2.20 10.0 3.01 2.30 3.67 2.55 2.98 3.88 2.80 3.40 2.90 3.78 3.70 5.34 5.00 5.68 5.40 7.23 5.55 4.78 5.60 3.65 5.60 6.20 5.60 5.23 5.60 5.86 5.60 4.53 5.60 9.48 11.4 8.77 24.4 11.9 3.41 3.40 5.59 4.60 12.2 266 357 408 503 202 233 318 392 433 471 481 483 6.7 4.3 2.6 3.3 6.5 4.0 2.9 1.8 6.9 2.5 4.5 4.0 5.3 0.9 2.9 0.0 1.3 0.0 3.0 0.0 3.9 3.8 2.0 6.2 0.0 4.2 n/a n/a 6.4 1.3 8.3 2.6 2.4 4.5 2.4 4.1 1.6 2.9 3.0 3.7 1.5 3.6 3.1 8.8 2.6 8.7 3.8 5.2 2.8 3.5 0.0 2.5 0.0 0.9 0.0 3.5 0.0 3.4 0.0 1.5 0.0 2.9 0.0 0.0 3.3 1.5 0.8 3.6 0.0 8.5 3.8 3.4 1.7 0.0 6.0 6.5 7.6 4.3 6.3 5.2 3.4 9.7 3.2 4.2 (p)* (%) (%) (%) (%) 66 87 / / / / (p) (p) (p) 10 10 10 10 # Chairman's Statement **“The Investment Manager’s focus remains on the avoidance of permanent capital loss (our preferred definition of risk) and on growing the real value of the Company’s capital over the long run”** We continue to live in a world of great uncertainty and increasing volatility with little expectation for improvement in the immediate future. We still have a war raging in Europe, particularly poignant as we commemorate the 80th anniversary of ‘D-Day’, and we now have a very intractable conflict in the Middle East. There are obvious growing international tensions across the globe and the outcome of the election in the United States will have literally ‘world changing’ ramifications. In the UK we are now in the General Election process and by the time of our AGM in July we will know the outcome. Most pundits are predicting a change of government. This is the challenging context in which we seek to deliver our core investment proposition, which is to protect and increase (in that order) the value of shareholders’ funds per share (also known as net asset value (‘NAV’) per share) over the long term. The Directors and our Investment Managers at Troy Asset Management Limited (‘Troy’), Sebastian Lyon and Charlotte Yonge, are shareholders in the Company. As such, we are all strongly aligned and are advocates for this investment proposition. As Directors, we work closely with the Troy team, bringing our collective experience to complement, inform, challenge and support. This close but independent relationship is particularly important when we are seeking to navigate uncertain and turbulent markets together. We track the performance of the Company from 1990. Since then, the NAV has grown at an annual compound rate of +6.5% compared to +3.4% for the UK Retail Price Index and +4.3% for the FTSE All-Share Index, our two main comparators. We also track the degree of risk experienced in achieving our financial performance. The results are tabulated in the Key Features section on page 2 and the volatility experienced is indicated on the chart on page 11. This shows that over the last 24 years the Company has been less volatile than equities in general and also less volatile than the AIC Flexible Investment Sector. Whilst this combination of above comparator financial performance and below-sector volatility is the outcome of a focus on capital preservation, these metrics are by no means a target. The Investment Manager’s focus remains on the avoidance of permanent capital loss (our preferred definition of risk) and on growing the real value of the Company’s capital over the long run. In his report on pages 6 and 7, Sebastian Lyon, our Investment Manager, provides further details of our investment performance and describes the particular challenges of the last year. The Company aims to pay as consistent and sustainable a dividend as is compatible with protecting and increasing the value of its shareholders’ funds and maintaining its investment flexibility. The Board remains committed to paying an annual dividend of 5.60p per share in line with this policy. High levels of inflation during the year, particularly in the United States, mean that the Company has again this year earned significantly more income on its holding of US TIPS than in previous years. Accordingly, in order to meet the investment trust distribution requirements, the Board has resolved to pay an additional special dividend for the year to 30 April 2024 of 1.60p per share. This dividend will be paid to shareholders in July 2024 alongside the first interim dividend of 1.40p per share for the year to 30 April 2025. During the year we bought back 49,244,828 Ordinary shares into Treasury under the Company’s discount control policy, for a net outflow of £232 million. As at 30 April 2024 we had 342,325,372 Ordinary shares in issue, with 50,479,828 Ordinary shares in Treasury. It is the policy of the Company to aim to ensure that, in normal market conditions, its Ordinary shares always trade at or close to NAV and this policy is enshrined in the Articles of Association. It is reassuring to report that since November 1999, when investment trusts were empowered to use capital to buy back shares and hence control the discount to NAV at which their shares trade, the Company’s share price has closely tracked the NAV both through periods of significant issuance and as demonstrated in the last year through a period of sustained buy back. Given the persistence of discounts for investment trusts generally, buyback activity throughout the year has been pronounced across the industry more widely. For the 6 Company, the year ending 30 April 2024 will be the first since 2007 when the number of shares in issue has declined year on year. The Board membership has enjoyed a further year of stability and I am grateful for the continuing commitment and wise counsel of my colleagues. We appointed Jennifer Thomas to the Board with effect from 1 May 2024. She brings more than 25 years of experience in leading communications in several international companies and we look forward to her contribution to our work. During 2022 Board Level Partners conducted an independent review of the performance of the Board and its Committees. Whilst this did not highlight any material weaknesses or concerns, it did identify some areas for further focus. These include planning for Board member succession, development of shareholder communications and closer monitoring of our relationships with our key service providers, Troy and Juniper Partners Limited ('Juniper'). During 2023 and 2024 we conducted internal reviews, and it is pleasing to record that we have made significant progress in each of the focus areas. Further detail can be found on page 29. As part of our oversight of our key service providers, we introduced a more formal annual review process with Troy in 2023 and this has been repeated in 2024. The review process is led by Mandy Clements and includes open discussions with all the Directors and several members of the senior team at Troy. We have all found this to be a positive and helpful exercise. In summary, our relationship with Troy continues to be excellent and we are increasingly benefitting from access to the shared resources and focused support from the wider Troy team. We now hold two Board meetings each year in the Troy offices in London which is helping us to get to know more members of the Troy team and to deepen our relationship on a broader base. As our shareholder funds continue to be above £1.5 billion, we are benefitting from the revised fee structure agreed in 2021. Details of the fee structure are shown on page 15. We also pay particular attention to ensuring the competitiveness of our ongoing charges ratio, which was 0.65% for the year ended 30 April 2024, having reduced from 0.89% in 2013 and remains in line with last year's figure. We had adopted a similar annual review process with Juniper in 2022 and have now completed our third review cycle. As with Troy, this process is led by Mandy Clements. Our relationship with Juniper, which provides our administrative, company secretarial, AIFM and discount control services, continues to be excellent with a very open and supportive culture. Juniper provides a first-class service to the Company and works in close association with Troy to provide a seamless service to the PAT Board and shareholders. We recognise the continuing evolution of the Company's shareholder base and the increasing number of investors holding shares through retail platforms who may not have direct access to communications with the Company. This is a challenge which is often discussed by the Board as we seek to improve communication and interaction with investors. We hope that our website (www.patplc.co.uk), our Quarterlies, our Annual and Interim Reports and our monthly Factsheet are providing investors with easy and effective access to information about PAT and we will continue to seek innovative ways of improving our dialogue with shareholders and with potential shareholders. We are looking forward to holding the AGM on Friday 19 July 2024 at The Kimpton Charlotte Square Hotel in Edinburgh. The Investment Manager's presentation will also be made available on our website following the AGM for those who cannot attend in person. I would encourage all shareholders to submit any questions for the AGM to our Company Secretary by email in advance of the meeting at cosec@junipartners.com by Tuesday, 16 July 2024. In the meantime, I wish you all good health and thank you for entrusting your investment to PAT. **Iain Ferguson CBE** **Chairman** 18 June 2024 7 # Investment Manager's Report **"We have been taken aback by investors' willingness to speculate so soon after the profitless tech boom of 2020/21, which quickly turned to bust. Whether history will repeat itself is open to question"** Over the year to 30 April 2024, the net asset value per share ('NAV') of Personal Assets Trust (the 'Company') rose by 1.2% while our traditional comparator, the FTSE All-Share Index rose by 3.4%. The UK Retail Price Index ('RPI'), which we also use as a comparator (see the inside front cover of this Report and Key Features and Record 1990-2024 on pages 2 and 3 respectively), rose by 3.3%. Over the past five years the NAV (total return) per share rose by 28.7% compared to FTSE All-Share return which rose by 30.1% and RPI which rose by 33.6%. The Company's NAV and share price (thanks to the discount control policy) continued to demonstrate below-average volatility compared to peers and the stock market. A year ago, we wrote about the burgeoning effects of rising interest rates and our expectation of slower economic growth combined with the risks of a recession. Signs of stress in the banking sector abated following the collapse of Silicon Valley Bank and Credit Suisse. The sting of tighter monetary policy has, thus far, largely been offset by aggressive fiscal stimulus, especially in the United States. Nevertheless, monetary policy always works with a lag, usually of 12 to 24 months, so with interest rates having peaked as recently as the summer of 2023, we are unlikely to have experienced their full effect. In the meantime, equity markets have been buoyed by the excitement surrounding generative Artificial Intelligence ('AI') and large language models such as ChatGPT-4. We have been taken aback by investors' willingness to speculate so soon after the profitless tech boom of 2020/21, which quickly turned to bust. Whether history will repeat itself is open to question. However, the scale of investment in capacity is reminiscent of the investment made in fibre during the dotcom boom. How sustainable this is, and whether such investment ultimately earns an economic return, remains to be seen but benefits are likely to accrue to more sustainable and recurring business models, such as Microsoft and Alphabet, which the Company continues to have exposure to. Despite renewed speculation in some parts of the equity market, bond markets have continued to disappoint. The secular bear market in bonds, which began in 2020 when yields troughed during the pandemic, has continued with rising yields (and falling prices). It is becoming clear that we have entered a new era of upward yield pressure and a commensurate rising cost of capital. While western bond markets have performed poorly, this may take time to be reflected in equity valuations, which remain high by historic levels. This new regime is the reverse of the 2010s, when benign inflation and low growth meant rate hike expectations were continuously dashed and bond yields ground ever lower. At the beginning of 2024, the consensus forecast was for no less than six interest rate cuts over the coming year from the US Federal Reserve and the Bank of England. Yet four months on, interest rate cuts have not been forthcoming. Fewer cuts, when they eventually arrive, may imply interest rates bottom at a higher level than many expect, with further implications for long-dated bonds and equities. As a result, we continue to keep duration risk low, which served us well in 2022 where we avoided material drawdowns from rising yields. We suspect there is a need to acclimatise to this new environment. Despite easy comparisons from price levels of a year ago, inflation has remained stickier than expected with core levels still stubbornly above targets in the US and the UK. This plays into our preference for holding inflation-linked bonds, which offer positive real yields. Our equity selection made a positive contribution to returns despite our modest exposure. Alphabet, American Express, Microsoft and Visa performed well. In contrast, consumer staples Diageo and Nestlé detracted. We continue to have confidence in the long-term prospects for these companies, which have a track record of providing strong returns to their shareholders over time. Portfolio activity was relatively modest, as is our natural proclivity, but we did add to the Company's holdings in Diageo, following its profit warning in November. During the year we acquired a new holding in Heineken. Heineken's shares have been weak, and the valuation now sits around the same level as its 2020 low. This follows difficult macroeconomic 8 conditions in some of the company's emerging markets, particularly Vietnam. We have been following Heineken for several years and are enthusiastic about its prospects. Heineken operates in the growing premium segment of the attractive beer category, with a strong portfolio of brands distributed over a diversified range of geographic exposures. Around 70% of its profits come from fast-growing emerging markets. Current management are still in the early stages of their tenure and are bringing renewed dynamism to the company's productivity, pricing and digitisation efforts. This combines with the company's long-term approach to capital allocation, supported by an ongoing history of family ownership, and should lead to attractive value creation over the long run. Since 2017, the Company has been invested in Franco-Nevada, a gold-focused royalty and streaming company. Franco-Nevada had an excellent track record in allocating capital to mining projects without the complexity, or capital, required to run the mining operation, providing its shareholders with geared exposure to the price of gold. This model worked well when Franco-Nevada was smaller but as the company has grown it has become harder to find investments that 'move the needle'. This has resulted in increased concentration across a handful of larger investments, most notably in the Panamanian gold and copper mine Cobre Panama, which comprises just under 20% of Franco-Nevada's assets. Growing social pressures in Panama led the government to question the constitutionality of the mine's concession agreement and to suspend its operations. We reduced our holding in December 2022 when these pressures first reared their head. After an apparent resolution in early 2023, the issue resurfaced, and we sold the remainder of our shares in November 2023. Franco-Nevada generated good returns and provided helpful diversification for the Company over the life of the investment. We sold the shares at an average price of $130, versus an average entry price of $65 in 2017. Its sale from the portfolio reflects a change in the facts and highlights our approach to managing stock-specific risk. Despite the sale of Franco-Nevada, gold remains essential portfolio insurance and provides diversification for the Company. During the financial year, the price of the yellow metal rose by +15% to $2,295oz. (+16% in Sterling). This strength has caught many investors by surprise as higher interest rates implied a higher opportunity cost for holding a zero-yielding asset like gold. Yet gold has outperformed the S&P 500 US equity index this century, demonstrating its substance and scarcity in an increasingly febrile and financialised world. Heightened geopolitical tensions and the gradual reversal of globalisation explain the continued attraction of an asset that is no one's liability, as well as sustained demand from central banks seeking to diversify their reserve assets away from western currencies, a process described as 'de-dollarisation'. Savers may also be seeking protection from sticky and stubborn inflation. Those with long memories will recall that higher interest rates and bond yields did not stop the price of gold rising in the 1970s. With ballooning deficits, in a post-Covid world, politicians have long forgotten fiscal rectitude. The US government debt situation no longer looks sustainable and yet warnings are being ignored by both presidential candidates. It is not entirely surprising that international investors are seeking to diversify into the longest standing reserve asset. The Chairman's Statement highlights the continued share buybacks, which began in March 2023, following a prolonged period of share issuance. We retain an intentionally liquid portfolio, which we can liquidate in a few days in normal market conditions. During a difficult period for the investment trust sector, which has witnessed a material widening of trust discounts to net asset values (NAV), our shareholders continue to be protected from PAT's discount widening. The Company's cautious asset allocation has not rewarded shareholders over the last year, but ample liquidity and the portfolio's defensive positioning provide a solid platform if we enter more challenging times. Grounds for caution remain. There is evidence of retail investor speculation including participation in cryptocurrencies and 'meme' stocks. Meanwhile the most recent Bank of America global fund manager survey highlights that fund managers are at their most bullish since the last equity market peak in November 2021. This is a time for patience and prudence, not ebullience. **Investment Manager, Troy Asset Management** 18 June 2024 9 Portfolio | Funds | Valuation | | Funds | Valuation | | | --- | --- | --- | --- | --- | --- | | 30 April | 30 April | | 30 April | 30 April | | | 2024 | | 2024 | 2023 | | 2023 | 10 Shareholders’ Shareholders’ Net current (liabilities)/assets UK cash Equities Unilever UK Food Producer Visa USA Financial Services Nestlé Switzerland Food Producer Diageo UK Beverages Microsoft USA Technology Alphabet USA Technology American Express USA Financial Services Becton Dickinson USA Pharmaceuticals Procter & Gamble USA Household Products Heineken Netherlands Beverages Agilent Technologies USA Healthcare Pernod-Ricard France Beverages Heineken Holding Netherlands Beverages Experian UK Industrial Moody’s USA Financial Services Franco-Nevada Canada Mining Total Equities Other Investments US TIPS USA Gold Bullion US Treasuries USA UK Gilts UK UK Index-linked Bonds UK Property Total Other Investments Total Investments Overseas cash Total Portfolio Security Country Equity Sector 1,184,568 1,642,362 1,807,663 1,356,059 1,667,281 1,884,352 457,794 608,415 208,874 193,377 116,636 451,604 639,348 178,392 279,369 257,220 64,625 51,210 43,860 41,672 37,292 36,539 36,214 29,395 26,968 25,561 16,593 13,097 12,805 12,489 55,536 29,436 (4,556) 69,263 53,606 55,685 45,891 33,490 27,886 24,820 32,918 25,679 16,301 19,845 10,815 27,442 49,732 26,675 9,474 1,730 7,963 1,730 100.0 100.0 (0.3) 27.5 24.0 36.5 33.9 12.5 11.6 14.8 13.6 71.0 71.9 98.5 95.9 £’000 £’000 282 3.9 3.7 3.1 2.8 2.6 3.0 2.5 2.4 2.2 1.8 2.2 1.5 2.2 1.3 1.8 1.7 1.6 1.4 1.5 1.0 0.9 0.8 1.1 0.8 0.7 0.6 0.6 0.3 1.5 9.5 7.0 3.3 0.1 0.1 1.8 2.6 0.0 39 0.0 1.5 – – – – % % – – – – # Geographic Analysis of Investments and Currency Exposure | | UK % | USA % | France % | Switzerland % | Netherlands % | Total % | | --- | --- | --- | --- | --- | --- | --- | | Equities | 7.1 | 14.7 | 0.8 | 2.6 | 2.3 | 27.5 | | Index-linked Bonds | 3.3 | 36.5 | – | – | – | 39.8 | | Gilts | 7.0 | – | – | – | – | 7.0 | | Treasuries | – | 11.6 | – | – | – | 11.6 | | Gold Bullion | – | 12.5 | – | – | – | 12.5 | | Property | 0.1 | – | – | – | – | 0.1 | | Cash | 1.8 | – | – | – | – | 1.8 | | Net current liabilities | (0.3) | – | – | – | – | (0.3) | | **Total** | **19.0** | **75.3** | **0.8** | **2.6** | **2.3** | **100.0** | | Net currency exposure | 57.1 | 37.2 | 0.8 | 2.6 | 2.3 | 100.0 | # Contribution to Performance ## Asset class contribution to performance 30 April 2023 to 30 April 2024 ### GRAPH Source: FactSet and Troy Asset Management Limited, 30 April 2024. Past performance is not a guide to future performance. Contribution to return is provided as gross absolute returns in local currency and does not include charges and fees. Currency exchange rates will impact the return of non-GBP securities. Asset allocation and holdings are subject to change. Reference to specific securities in this slide is not intended as a recommendation to purchase or sell any investment. | Top 5 equity contributors | % | | --- | --- | | Alphabet | 0.8 | | American Express | 0.7 | | Microsoft | 0.5 | | Visa | 0.4 | | Experian | 0.1 | | Bottom 5 equity contributors | % | | Becton Dickinson | -0.2 | | Franco-Nevada | -0.3 | | Pernod Ricard | -0.3 | | Nestlé | -0.6 | | Diageo | -0.6 | 11 Ten Year Performance Share Price versus FTSE All-Share Index (based to 100) GRAPH Share Price Total Return versus FTSE All-Share Index Total Return (based to 100) GRAPH 12 ## **Annual Performance since 30 April 2000** The first chart on this page is designed to show the share price volatility of the Company compared to that of the FTSE All-Share Index. The chart shows how, with the exception of 2013-2014, 2017-2018 and 2022-2023, the Company's capital performance has tended to be less volatile than that of the All-Share but, even taking all the above periods into account, the Company's long-term price gain of 139.1% since April 2000 has comfortably exceeded the All-Share's 47.6%. ## **Annual percentage change in Share Price and FTSE All-Share Index to 30 April** GRAPH ## **Volatility and Share Price Total Return Performance since 30 April 2000** Note: The Scatter Graph shows the share price total return performance of the Company (very large blue dot) compared to the FTSE All-Share Index, the FTSE UK Conventional Gilts All Stocks TR Index and the AIC Flexible Investment Sector. These are shown in terms of share price return (vertical axis) and annualised price volatility (horizontal axis) since 30 April 2000. ## **Volatility Compared to Peer Group since 30 April 2000** GRAPH 13 # The Board ### **Iain Ferguson CBE** #### **Chairman** Shares held: 476,901 Iain joined the Board as a non-executive Director in 2017 and became Chairman in 2020. Iain is also Chairman of Crest Nicholson Holdings plc and Genus plc. He was previously Chairman of Berendsen plc, Stobart Group Limited and Senior Independent Director and Chairman of the Remuneration Committee at Balfour Beatty plc. Until 2009 he was Chief Executive of Tate & Lyle. Prior to joining Tate & Lyle in 2003, he spent 26 years at Unilever in a succession of roles culminating in his appointment as senior vice president, corporate development. He holds a BSc (Hons) in Chemistry & Psychology from St Andrews University and has the Harvard Business School Advanced Management Programme. ### **Jean Sharp** #### **Chair of the Audit and Risk Committee** Shares held: 69,100 Jean joined the Board as a non-executive Director in 2016. She is also a non-executive Director and Chair of the Audit Committee of Flood Re Limited and FBD Holdings plc. Until December 2019 she was Chief Taxation Officer of Aviva and its predecessor companies, a role she had held since 1998. She is a Chartered Accountant and a former partner of EY LLP. She holds a BComm and a MAcc from University College Dublin. ### **Paul Read** #### **Senior Independent Director** Shares held: 540,000 Paul joined the Board as a non-executive Director in 2017. Until his retirement in December 2021, Paul Read co-lead Invesco's Henley based fixed income team. He began his investment career in 1986 in investment banking fixed income sales and trading, first with UBS (Securities) Ltd and later with Merrill Lynch International. He holds a BA in Economics and History from the University of Toronto and also has an MBA from INSEAD. ### **Mandy Clements (nee Pike)** #### **Non-executive Director** Shares held: 12,301 Mandy joined the Board as a non-executive Director in 2020. Until December 2019 Mandy was CEO of legal entities responsible for £300 billion of assets at Aberdeen Standard Investments, having worked at the group for 19 years. She also oversaw the dealing function globally for over 14 years and has held dealing roles at F&C Asset Management (Foreign and Colonial), Brewin Dolphin and BNP Capital Markets, having started her career at Grieveson Grant Stockbrokers in 1983. 14 Gordon Neilly Non-executive Director Shares held: 197,443 Gordon joined the Board as a non-executive Director in 1997 and has considerable experience and knowledge of investment trusts. Gordon is Executive Chairman of WhiteStar Asset Management Europe, a director of Clearlake Capital Group UK Limited and a non-executive director of Montanaro European Smaller Companies Trust plc. He was previously Chief of Staff at Standard Life Aberdeen. Prior to this he was Head of Strategy and Corporate Activity at Aberdeen Standard Investments, Co- Chief Executive Officer of Cantor Fitzgerald Europe, Chief Executive of Intelli Corporate Finance and Finance and Business Development Director of Ivory & Sime. Jennifer Thomas Non-executive Director Shares held: nil Jennifer joined the Board as a non-executive Director on 1 May 2024. Jennifer is a prominent diversity and inclusion and communications specialist with over 25 years’ experience in leading external and internal communications strategies within various organisations. She is currently the Global Head of Equity, Diversity and Inclusion (EDI), leading the EDI strategy and agenda for the London Stock Exchange Group plc (LSEG). Jennifer was previously the Head of Communications for the Data and Analytics division of LSEG and prior to that she consulted at GSK plc on their global diversity and inclusion strategy. Previous other roles include Director of Internal Communications, Experience and Sustainability and Director of Financial Communications at Direct Line Group. Jennifer is also the Senior Independent Director for England Netball and UK Athletics. Robbie Robertson Non-executive Director Shares held: 30,000 Robbie joined the Board as a non-executive Director in 2020. During a 37 year career in investment trust broking, Robbie gained extensive experience of investment trust sales, research and corporate advisory services. He worked as an investment trust analyst for Laurence Prust and Wood Mackenzie, and then headed the investment companies teams at Dresdner Kleinwort Wasserstein and Canaccord Genuity. Robbie holds an M.A. in English Literature from Edinburgh University and an M.Litt from Oxford University. 15 Strategic Report For the year to 30 April 2024 Introduction Personal Assets Trust plc (the ‘Company’) is what its name implies. It is an investment trust run for private investors, who range from first time savers to experienced investors, who may often have entrusted a significant part of their portfolio to the Company. The Company’s investment policy is to protect and increase (in that order) the value of shareholders’ funds per share over the long term. It differs from other investment trusts in that its activities are defined not by any particular portfolio specialisation or investment method but by a desire to satisfy the personal requirements of those who invest in it. This is reflected in the Board’s statement that ‘our specialisation will be our shareholders’. Principal Activities and Status The Company is incorporated in Scotland (registered number SC074582). It is an investment company as defined by Section 833 of the Companies Act 2006. It carries on the business of an investment trust and has been approved as such by HM Revenue & Customs. Business Model and Strategy for Achieving Objectives The Company is run by its Board of Directors which, with the appointment of Jennifer Thomas to the Board on 1 May 2024, now comprises seven non-executive Directors. Four of the Directors are male and three are female. The Board is responsible for the overall stewardship of the Company, including investment objectives and strategy, dividends, corporate governance procedures and risk management. Biographies of the Directors can be found on pages 12 and 13. The Directors have a duty to promote the success of the Company. The Directors believe that the best way of achieving this, as well as delivering the Company’s objective, is to maintain the strong working relationship with the Investment Manager, Troy Asset Management Limited (‘Troy’ or the ‘Investment Manager’). Troy acted as Investment Adviser to the Company since 2009 and with effect from 1 May 2020 was appointed as the Company’s Investment Manager. Troy operate within an investment universe, including bands and ranges, which has been agreed by the Board. The Board has appointed Juniper Partners Limited (‘Juniper’) as its AIFM. The day-to-day management of the portfolio has been delegated by the AIFM to the Investment Manager, and is the responsibility of Sebastian Lyon, the Founder and Chief Investment Officer of Troy, in particular. Juniper also provide company secretarial, administration and discount and premium control services to the Company. Troy’s investment approach is conservative, attention being paid first and foremost to the downside risk of any investment. Troy regard risk as permanent loss of an investor’s capital rather than performance relative to a particular benchmark. The Investment Manager employs a long-term, long-only approach to investing and has the ability to invest globally. Whilst asset allocation will vary, in general the investment universe comprises high quality, developed market equities, developed market government bonds, gold bullion, cash and money market instruments (such as treasury bills) which the Board believes aligns with its long term investment strategy. Troy judge the safety and attractiveness of asset classes not just relative to each other but also relative to the asset classes’ histories. When allocating the Company’s assets Troy incorporate valuation measures, inflation expectations, and monetary and fiscal conditions into their decision-making process from both a top-down perspective and a stock-specific perspective. Investment Policy The Company is an investment trust with the ability to invest globally. Its investment policy is to protect and increase (in that order) the value of shareholders’ funds per share over the long term. While the Company uses the FTSE All-Share Index (the ‘All-Share’) as a comparator for the purpose of monitoring performance and risk, the composition of the All-Share has no influence on investment decisions or the construction of the portfolio. As a result, the Company’s investment performance is 16 likely to diverge from that of the All-Share. Our definition of 'risk' is fundamentally different from that commonly used by other global investment trusts and the industry at large (ours being 'risk of losing money' rather than 'volatility of returns relative to an index'). Taking this as our definition of risk, the Board will usually, although not invariably, prefer the Company's portfolio as a whole to have a lower level of risk than the All-Share. The Company will invest in equities and fixed income securities and it may also hold cash and cash equivalents and gold. The Company may use derivatives as a way of increasing or reducing its investment exposure and to enhance and protect investment positions. The Company may also from time to time make use of currency hedging. The Company has no predetermined maximum or minimum levels of exposure to asset classes, currencies or geographic areas but these exposures are reported to, and monitored by, the Board in order to ensure that adequate diversification is achieved. The Company's equity portfolio is typically concentrated in a short list of stocks and turnover tends to be low. No holding in an individual company will represent more than 10% by value of the Company's total assets at the time of acquisition. The Company is prepared to make use of both gearing and liquidity, the former by using short-term borrowed funds or derivatives such as FTSE 100 Futures. The Company's gearing will not exceed 50% of shareholders' funds in aggregate. In exceptional circumstances, the Company's liquidity could be as high as 100% of shareholders' funds. These limits would not be exceeded without shareholder approval. The Company may also invest in other investment trusts, especially as a way of gaining exposure to a region or industry in which the Company preferred not to invest directly. The Company's policy is not to invest more than 15% of its total assets in other investment trusts and other listed investment companies. An analysis of the investment portfolio at 30 April 2024 can be found on page 8. ### **Investment Manager** Troy provides investment management services to the Company pursuant to a delegation agreement between the Company, the AIFM (Juniper) and Troy. The Investment Management Agreement may be terminated on six months' notice. No compensation is payable to the Investment Manager in the event of termination of the agreement over and above payment in respect of the required six months' notice. The fee payable to Troy in accordance with the Investment Management Agreement, which is based on the Company's shareholders' funds, is: 0.65% on the first £750 million; 0.5% between £750 million and £1,500 million; and 0.45% thereafter, payable quarterly in arrears. The investment management fee is reduced by the amount payable by the Company to Juniper for its AIFM services, which is calculated on the basis of 0.015% of shareholders' funds. During the year the Board has reviewed the appropriateness of Troy's appointment. In carrying out its review the Board considered the investment performance of the Company since the appointment of Troy and its capability and resources to deliver satisfactory investment performance. It also considered the length of the notice period of Troy and the fees payable to it. Following this review the Directors are confident of the Investment Manager's ability to deliver satisfactory investment performance. It is therefore their opinion that the continuing appointment of the Investment Manager, on the terms agreed, is in the interests of shareholders. At 30 April 2024 Sebastian Lyon had an interest in 2,574,799 (2023: 2,527,499 ) shares of the Company. Charlotte Yonge, Assistant Manager, had an interest in 57,008 (2023: 57,004) shares of the Company. Since the year end Mr Lyon has acquired an interest in a further 262,617 shares. ### **Dividend Policy** The Company aims to pay as consistent and sustainable a dividend as is compatible with protecting and increasing the value of its shareholders' funds and maintaining its investment flexibility. 17 Discount and Premium Control Policy Investment trusts have long suffered from volatile discounts to net asset value. Sometimes, too, the shares of individual investment trusts may sell temporarily at a significant premium to net asset value. This can put those investing regularly at a disadvantage, because they may find themselves buying shares at a sizeable premium which almost certainly will not be sustained and which will therefore have an adverse effect on the return from their investment. In view of the disadvantages to shareholders of such discount and premium fluctuations, the Company’s policy is to ensure that its shares always trade at close to net asset value through a combination of share buy-backs at a small discount to net asset value where supply exceeds demand and the issue of new or Treasury shares at a small premium to net asset value where demand exceeds supply. This discount and premium control policy is enshrined in the Articles of Association of the Company. The Board has convened a general meeting to be held on 9 July 2024 to renew the buy-back authority and ensure the continued operation of this policy. Key Performance Indicators The Board assesses its performance in meeting the Company’s objectives against the following Key Performance Indicators, details of which can be found in the Key Features on page 2 or, in the case of the volatility of the share price, on page 11 under the heading Volatility and Share Price Total Return Performance, since 30 April 2000, being the year end closest to the peak of the great 1990s bull market: ● volatility of the share price total return compared to the total returns of the FTSE All-Share Index, the AIC Flexible Investment Sector and the FTSE UK Conventional Gilts All Stocks TR Index; ● share price and net asset value total return per share against the total return of the RPI, CPI, and the FTSE All-Share Index over the long term whilst aiming to protect and increase (in that order) the value of shareholders’ funds per share in accordance with the Company’s investment objective; and ● the range and volatility of the discount or premium to net asset value at which the Company’s shares trade, in order to ensure compliance with its discount and premium control policy enshrined in the Articles of Association of the Company. Competitive and Regulatory Environment The Company is an investment trust quoted on the London Stock Exchange and is a member of the AIC. The Company operates so as to comply with Section 1158 of the Corporation Tax Act 2010, which allows it to be exempted from capital gains tax on realised investment gains. In addition to publishing annual and interim reports the Company announces net asset values per Ordinary share daily and provides more detailed statistical information on a monthly basis to the AIC in order to enable investors to compare its performance and other relevant information with those of its peer group, the AIC Flexible Investment Sector. The Company also publishes quarterly reports on subjects of investment interest to shareholders together with portfolio information and performance statistics. 18 Principal Risks and Risk Management The Board has carried out a careful assessment of the principal risks facing the Company, including the ongoing current geopolitical risks and the ongoing impacts of inflation levels and heightened interest rates. The Board has established and maintains, with the assistance of the Company Secretary, a risk matrix which identifies the key risks to the Company. This register is formally reviewed on a regular basis. Emerging risks that could impact the Company are considered and discussed at each Board meeting, or on an ad hoc basis as required, along with any proposed mitigating actions. The principal risks and uncertainties facing the Company, together with a summary of the mitigating action the Board takes to manage these risks and how these risks have changed over the period, are set out below. The arrows denote if the relevant risk has increased, decreased or remained the same during the year after considering the mitigating actions. The Board seeks to mitigate these emerging risks through maintaining a broadly diversified global equity portfolio and appropriate asset and geographical allocation. In respect of climate change risks, the investment process considers ESG factors, as set out in the Strategic Review. Overall the specific potential effects of climate change and developing technology are difficult, if not impossible, to predict and the Board and Investment Manager will continue to monitor developments in this area. The Board is in regular communication with the Investment Manager on emerging matters which may impact on the portfolio. er securities within Notes to the Accounts on pages 47 to 59. Risk Mitigation The Company’s strategy is reviewed formally on at least an annual basis considering investment The Board believes that the principal risk to The Board regularly monitors the investment performance, market developments and shareholders and the Company’s investments are environment and the management of the Risk Mitigation shareholder communication. The Board receives events or developments, including the emerging Company’s investment portfolio, and applies the The conflicts in Ukraine and the Middle East regular updates on the composition of the risks noted above, which can affect the general principles detailed in the guidance provided by the continue to bring risk to economic growth and Company’s portfolio. Investment performance level of share prices and oth Financial Reporting Council. Further details on the investors’ risk appetites and consequently can and the portfolio composition has been monitored the portfolio. These include for instance, inflation Company’s financial risks are contained in the impact the valuation of companies in the specifically in the light of the emerging risks or deflation, economic recessions and movement portfolio. There is also an increasing awareness of noted above. in interest rates and currencies which could cause the challenges and emerging risks posed by losses within the portfolio. climate change as well as the impact and pace of technological developments on the companies in the investment universe. 19 Emerging ↑ Increased risk Economic ↑ Increased risk The Board formally reviews the Company’s service providers on an annual basis, including reports on their internal controls where available. As part of the annual review the Board considers nd Equiniti the business continuity plans in place with each of its key suppliers and the measures taken to mitigate cyber threats. The Company’s internal controls are described in more detail on pages 33 Company. and 34. Compliance with the Company’s regulatory obligations is monitored on an ongoing basis by ies, or a qualified audit the AIFM, the Investment Manager and other professional advisers as required who report to the Board regularly. The Company’s discount and premium control policy, which is enshrined in the Articles of Association, is to ensure that shares always trade at close to net asset value. The level of share buybacks or issuance under the policy is reported via an RIS on an ongoing basis. Duty to Promote the Success of the Company The Directors have a duty to promote the success of the Company for the benefit of its shareholders as a whole. The Directors are required to include a report explaining how they have considered all the requirements and discharged their duties under Section 172(1) of the Companies Act 2006, taking into account the likely long-term consequences of decisions taken, the need to foster relationships with all stakeholders in the Company and the impact of the Company’s operations on the environment. The report includes specific matters the Board has considered during the year. The Company being an investment trust, the key stakeholders comprise its shareholders, the Investment Manager and its other third-party service providers (including the Company Secretary and Administrator, Registrar, Depositary and Custodian). Risk Mitigation The Company is reliant on service providers including Troy as Investment Manager, Juniper as Risk Risk Mitigation Mitigation AIFM, Company Secretary, Administrator and | discount and premium control provider, J.P. Breach of legal and regulatory rules could lead to The share price could be impacted by a number of | | | --- | --- | | Morgan as Depositary and Custodian a external factors which could cause significant the suspension of the Company’s Stock Exchange | | | as Registrar. Failure of the internal control listing, financial penalt discount and premium fluctuations. | 20 | | systems of these parties, including in relation to report. Breach of Section 1158 of the Corporation | | | cybersecurity measures, could result in losses to Tax Act 2010 could lead to the Company being | | | the → Risk remains relatively unchanged Operational → Risk remains relatively unchanged Legal and Regulatory subject to tax on realised capital gains. Discount and Premium Control → Risk remains relatively unchanged | | shareholders and places considerable shareholders when making key decisions importance on communications with in relation to promoting the long term them and the need to act fairly between success of the Company both for the all shareholders. benefit of existing shareholders as a whole and to continue to attract new The Investment Manager reports back investors to the Company. During the regularly to the Board on meetings with year the Board undertook a search for an shareholders and the Chairman and other additional non-executive Director who Directors are available to meet would enhance the overall skills and shareholders if required. experience of the Board and its The Annual General Meeting of the Committees. Jennifer Thomas was Company and Troy’s Annual Investment subsequently appointed a non-executive Trust Seminar in London provide a Director of the Company 1 May 2024. formal forum for shareholders to meet During the year the Company completed and discuss issues with the Board. the cancellation of its share premium Shareholder lunches are also held on a account. The Board believes that the regular basis to allow discussion of conversion of the share premium account matters on a more informal basis. to a distributable reserve will provide a significant pool of reserves which can be used in future, if required, to fund share buybacks or other returns of capital in accordance with the applicable law. The cancellation will therefore facilitate the continued effective operation of the discount and premium control policy and provides the Company with more flexibility in how the reserves are established for future events. relationships is with its Investment to consider ESG matters and in particular Manager, Troy. The Board seeks to has considered the increasing awareness maintain high standards of business placed on climate change risks on the conduct within all its business portfolio at its quarterly Board meetings. relationships and continues to work The Board continues to work closely with closely with the Investment Manager to the Investment Manager to understand Shareholders The Board welcomes the views of The Board incorporates the views of ensure such standards are met. the ESG considerations that impact on the portfolio. The Company has The Directors, Sebastian Lyon, Charlotte published a public ESG policy which is Yonge and their respective families have Investment Manager One of the Company’s primary business During the year the Board has continued available on the AIC website. substantial shareholdings in the Company (see pages 12, 13, 15 and 30) and those who run the Company therefore have a common interest with those who invest in it. The Board continues to be mindful of ESG matters and believes it is in shareholders’ interests to consider such matters when selecting and retaining investments. The Board supports and encourages the Investment Manager’s positive engagement approach with the underlying investee companies. Further details on this approach can be found in the Strategic Report on pages 20 and 21. 21 Key Stakeholders How do we engage Specific Example of Stakeholder Consideration relationships is with its AIFM, Company Committee has continued its enhanced Secretary, Administrator and discount review process in respect of its two key and premium control provider, Juniper. suppliers, Troy and Juniper. For both The Board seeks to maintain high parties this process is led by Mandy standards of business conduct within all Clements and is designed to give the its business relationships and continues to Board more in depth oversight of the work closely with Juniper to ensure such effectiveness of the internal processes standards are met. and controls and to continue to improve the direct information flows between the Juniper seeks to maintain constructive Company and the relevant teams. relationships with the Company’s other third-party suppliers, for example the Registrar, the Depositary and the Custodian, on behalf of the Board typically through regular communication and provision of information. Third Party Service The Company’s other primary business The Management Engagement Providers 22 Key Stakeholders How do we engage Specific Example of Stakeholder Consideration Responsible Investment In prioritising capital preservation, the Investment Manager pays significant attention to the downside risk of any investment. It is Troy’s fiduciary duty to assess the drivers of long-term value in the investment process. An important part of this is a consideration of the material environmental, social and governance (‘ESG’) factors that can impact the long-term success of an investment. Responsible investment efforts include the fundamental integration of material ESG factors into investment analysis, portfolio construction and stewardship activities (voting and engagement). The Investment Manager’s responsible investment approach therefore aims to ensure alignment with the Company’s investment objectives. Research Process A core part of the Investment Manager’s research process is understanding and assessing the material financial and non-financial risks and opportunities that may impact the long-term returns of an investment. It is in this context that Troy’s investment team seeks to integrate the consideration of ESG factors into fundamental analysis during all stages of the research process. Troy may seek to either mitigate the adverse impact or improve the positive impact of investments on the environment or society if doing so is aligned with improving the risk and return profile of the investment. The Investment Manager would only do so if this does not run contrary to the investment objectives of the Company. Since materiality is dynamic, Troy does not seek to limit the categories that ESG encompasses. Rather, the aim is to facilitate the analysis and appreciation of relevant and material ESG factors specific to each company. The Investment Manager therefore does not employ a prescriptive checklist, nor score holdings on ESG criteria. Instead, a qualitative assessment is carried out to assess the risks and opportunities of each relevant ESG factor. Analysis is materiality-driven and the factors considered will depend on the ESG risks and opportunities each company is exposed to, as well as the industry and geographies they operate in. The ESG factors Troy may consider are outlined below, though this does not comprise an exhaustive list of all factors considered. ● Energy mix management harm ● Workplace effectiveness ● Technological ● ● Biodiversity ● Chemical use culture ● Management disruption ● Pollution ● Data privacy ● Employee capability ● Net zero alignment ● Waste ● Cyber security treatment and ● Corporate ● Physical risk ● Circularity empowerment behaviour ● Business ethics Climate Change The Investment Manager believes climate change to be one of the most significant and complex systemic risks facing the world today. As a result, Troy assesses all equity holdings for their exposure to climate-related risks and opportunities which includes an assessment of both transition and physical risks (and opportunities where relevant). Troy’s annual TCFD Report further outlines how climate- related considerations are integrated into the investment process and includes climate related metrics to the Company, is published on the Troy website (www.taml.co.uk). Time Horizon: The Investment Manager aims to invest in stocks that can be held for the long term (five years or more). This time horizon clearly extends into the time frame over which one can reasonably expect the impact of climate change to be felt. As such the management of climate risk is implemented within the investment process. ● Carbon pricing ● Natural resource ● Product use and ● Human rights ● Board 23 Product Safety Corporate Governance & Responsibility Human Capital Climate Change Natural Capital Transition Risk: The Investment Manager assesses that the risks associated with a transition to a lower carbon economy fall well with Troy’s investment time horizon of more than five years. Whilst Troy’s investment process favours capital-light investments, and the Company has limited exposure to the most carbon-intensive sectors, the analysis of transition risk at the individual stock and portfolio level remains an important part of the investment process. Physical Risk: The risks associated with a warming climate, including from rising sea levels, extreme weather and wildfire events, are extremely difficult to model and are risks that impact almost all companies. The understanding of how physical climate risk might impact financial markets and asset prices is in its infancy but Troy continues to develop its understanding of this and apply it to the analysis of companies. Monitoring of and Engagement with Investee Companies Whilst the Company seeks to invest in companies whose business strength and corporate governance policies mean they generally do not require significant shareholder intervention, the Investment Manager does recognise that engagement is an important aspect of fiduciary duty. Engagement is generally conducted proactively and as part of an investee company’s decision-making process; Troy is also willing to engage reactively where a company has taken a course of action that conflicts with its standpoint. The impetus to engage may stem from a breach by the company of generally accepted business practice norms, Troy’s proxy voting process or integrated ESG analysis. Any engagement would be expected to meet the following criteria: ● there is a clear objective in engaging with a company; ● the matter for engagement must be material; and ● the engagement with the company is constructive. Voting and Disclosure of Activity The Company considers (proxy) voting an important part of its stewardship activities and investment process and aims to use its voting rights to both safeguard the interests of shareholders and encourage environmental and social sustainability (where these objectives are aligned). The Investment Manager will seek to instruct votes, on behalf of investors, on all resolutions for which it has voting authority. Troy conducts analysis of each management or shareholder resolution ahead of voting. Votes are then cast in line with what is deemed to be in the best long-term interest of shareholders. Environmental and social sustainability are considered alongside governance factors in this analysis. Whenever possible, voting on any resolution is incorporated as part of the wider engagement with management. Troy’s preferred course of action would be to have dialogue with any company ahead of casting a vote against management. Where appropriate Troy may also seek to engage with a company following a vote against management. UN Principles for Responsible Investment As part of the Investment Manager’s commitment to responsible investing, Troy became a signatory to the United Nations’ Principles for Responsible Investment in September 2016. 24 Directors’ Report The Directors have pleasure in presenting their Annual Report together with the audited financial statements of the Company for the year to 30 April 2024. Results A review of the Company’s returns during the financial year, the position of the Company at the year end and the outlook for the coming year is contained within the Chairman’s Statement and Investment Manager’s Report on pages 4 to 7. Board of Directors At the year end the Board comprised six non-executive Directors. Jennifer Thomas was subsequently appointed to the Board on 1 May 2024. The biographies of the Board are set out on pages 12 and 13. Activities A review of the Company’s activities during the year can be found in the Strategic Report on pages 14 to 19 and in the Chairman’s Statement and Investment Manager’s Report. Responsibility Statement The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulation. Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the financial statements in accordance with UK-adopted international accounting standards. Under company law, Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. In preparing the financial statements, the Directors are required to: ● select suitable accounting policies and then apply them consistently; ● state whether applicable UK-adopted international accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; ● make judgements and accounting estimates that are reasonable and prudent; and ● prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business. The Directors are responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors are also responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements and the Directors’ Remuneration Report comply with the Companies Act 2006. The Directors are responsible for the maintenance and integrity of the Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Responsibility Statements under the Disclosure Guidance and Transparency Rules Each of the Directors listed on pages 12 and 13 confirms that to the best of her or his knowledge: ● the financial statements, prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and 25 ● the Strategic Report includes a fair review of the development and performance of the business and the position of the Company together with a description of the principal risks and uncertainties that it faces. Corporate Governance Full details are given in the Corporate Governance statement on pages 26 to 29. The Corporate Governance statement forms part of this Directors’ Report. Going Concern The Directors believe, in the light of the controls and review processes reported in the Report of the Audit and Risk Committee on pages 33 and 34 and bearing in mind the nature of the Company’s business and assets, which are considered to be readily realisable if required, that the Company has adequate resources to continue operating for at least 12 months from the date of approval of the financial statements. For this reason, they continue to adopt the going concern basis in preparing the accounts. As part of the going concern assessment a sensitivity analysis was performed. If the market dropped by 25% and no dividend income became available the Company would be able to continue operating for the foreseeable future. Viability Statement The Board considered its obligation to assess the viability of the Company over a period longer than the 12 months from the date of approval of the financial statements required by the ‘going concern’ basis of accounting. The Board considers the Company, with no fixed life, to be a long term investment vehicle but, for the purposes of this viability statement, has decided that a period of five years is an appropriate period over which to report. The Board considers that this period reflects a balance between looking out to a long term horizon and the inherent uncertainties of looking out further than five years. When deciding on this period the Directors considered the nature of the Company’s portfolio of liquid investments comprising listed global equities, US TIPS, US Treasuries, UK Index-Linked Bonds, UK Gilts, UK T-Bills, Gold Bullion and cash and cash equivalents. The Directors also considered the Company’s ability to fulfil the stated dividend policy and the operation of its discount and premium control policy. The Directors have also carried out an exhaustive assessment of the principal and emerging risks as noted in the Strategic Report on pages 16 and 17 and discussed in note 14 to the financial statements that are facing the Company over the period of the review, including those that would threaten its business model, future performance, solvency or liquidity. Based on the results of this analysis, the Directors have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the five year period of their assessment. Duty to Promote the Success of the Company A summary explaining how the Directors have discharged their duties under section 172 of the Companies Act 2006 and considered the views of the Company’s key stakeholders in regard to any key decisions taken throughout the period is contained in the Strategic Report on pages 18 and 19. Capital Structure At 30 April 2024 there were 392,805,200 Ordinary shares of 12.50p each in issue of which 50,479,828 Ordinary shares are held in Treasury. During the year 49,244,828 shares were bought back and held in Treasury at a cost of £232,467,000. 26 The revenue profits of the Company (including accumulated revenue reserves) and realised capital profits are available for distribution by way of dividends to the holders of the Ordinary shares (excluding any Ordinary shares held in Treasury, which have no entitlement to dividends). Voting rights and deadlines for exercising voting rights can be found in the Notes for the Annual General Meeting ('AGM') which can be found on pages 62 and 63. ## Results and Dividend The results for the year are set out in the Income Statement on page 43. The Company pays quarterly dividends in January, April, July and October. The Company paid four quarterly interim dividends of 1.40 pence per share and will pay a special dividend of 1.60 pence per share to shareholders in respect of the year ended 30 April 2024. The special dividend will be paid on 31 July 2024 to shareholders on the register on 28 June 2024. The ex-dividend date will be 27 June 2024. ## Ongoing Charges The unaudited Ongoing Charges for the year ended 30 April 2024 was 0.65% (2023 unaudited: 0.65%). ## Substantial Interests At 30 April 2024 the Board is aware of the following holdings representing (directly or indirectly) three per cent. or more of the voting rights attaching to the issued share capital of the Company: | Substantial Holder | Shares Held | Percentage | | --- | --- | --- | | Interactive Investor | 62,352,708 | 18.2% | | RBC Brewin Dolphin | 46,322,421 | 13.5% | | Hargreaves Lansdown | 35,511,395 | 10.4% | | Rathbones | 18,650,247 | 5.4% | | AJ Bell | 18,509,675 | 5.4% | | Charles Stanley | 13,441,579 | 3.9% | Source: RD:IR There have been no changes notified in respect of the above holdings, and no new holdings notified, since the end of the year. ## Financial Instruments Information on the Company's financial instruments can be found in the Notes to the Accounts on pages 47 to 59. ## Principal Risks and Risk Management Information on the principal risks to shareholders and management of these risks can be found in the Strategic Report on pages 16 and 17 and in note 14 to the Accounts on pages 55 to 58. ## Directors' Indemnity The Company's Articles of Association entitle any Director or Officer of the Company to be indemnified out of the assets of the Company against any loss or liability incurred by her or him in the execution of her or his duties in relation to the Company's affairs to the extent permitted by law. Directors' and officers' liability insurance cover is in place in respect of the Directors and was in place throughout the year under review. ## Modern Slavery Statement The Modern Slavery Act 2015 requires certain companies to prepare a slavery and human trafficking statement. As the Company has no employees and does not supply goods and services, it does not fall within the scope of The Modern Slavery Act and therefore no slavery or human trafficking statement is required to be included in the Annual Report. However, the Company has chosen to make an annual 27 statement available on its website as a matter of good corporate governance and its commitment to high business standards throughout its supply chains. Carbon Emissions As an externally managed investment trust with no employees, the Company’s greenhouse gas emissions are negligible. Streamlined Energy and Carbon Reporting applies to all large companies. However, as the Company did not consume more than 40,000 kWh of energy during the past year, it qualifies as a low energy user and is exempt from reporting under these regulations. Charitable Donations The Company has agreed to make an annual donation of £50,000 per annum to the Personal Assets Foundation. The Foundation is run independently of the Company and its objective is to promote and advance the financial education of younger people wishing to pursue careers within or related to the investment and finance industries. The Directors meet with the Trustees of the Foundation on an annual basis to receive an update on its activities and to review the ongoing donation. Independent Auditors PricewaterhouseCoopers LLP have indicated their willingness to continue in office as Auditors and a resolution proposing their re-appointment will be proposed at the AGM. Statement of Disclosure of Information to Auditors As far as the Directors are aware, there is no relevant audit information of which the Auditors are unaware, and each Director has taken all the steps that he or she ought to have taken as a Director in order to make herself or himself aware of any relevant audit information and to establish that the Auditors are aware of that information. Annual General Meeting The Annual General Meeting (‘AGM’) of the Company will be held at The Kimpton Charlotte Square Hotel, Edinburgh EH2 4HQ on Friday 19 July 2024 at 12 noon. The Board would welcome your attendance at the AGM as it provides shareholders with an opportunity to ask questions of both the Board and the Investment Manager. Resolutions to be proposed at the AGM Resolutions 1, 2 and 4 to 11 inclusive are self-explanatory and will be proposed as ordinary resolutions. Resolution 3 – Dividend Policy As a result of the timing of the payment of the Company’s quarterly dividends in January, April, July and October the Company’s shareholders are unable to approve a final dividend each year. As an alternative the Board puts the Company’s dividend policy to shareholders for approval on an annual basis. Resolution 3, which will be proposed as an ordinary resolution, relates to the approval of the Company’s dividend policy which is as follows: Dividends on the Ordinary shares are payable quarterly in January, April, July and October. The Company aims to pay as consistent and sustainable a dividend as is compatible with protecting and increasing the value of its shareholders’ funds and maintaining its investment flexibility. The Company has the ability in accordance with its Articles of Association to make distributions from capital. Resolution 12 – Aggregate Directors’ Fees The Articles of Association currently provide that Directors’ fees shall not, in aggregate, exceed £302,500 per annum. Although there are currently no plans to make any further changes to the levels of 28 fees paid to the non-executive Directors, save for those increases disclosed in the remuneration report, the Board wishes to propose an increase to the fee limit contained in the Articles of Association to reflect the increased size of the Board and to allow for the recruitment of additional non-executive Directors as part of the continued refreshment of the Board. It is proposed that the fee limit be increased to £332,750 per annum in aggregate. Directors' remuneration will continue to be paid in accordance with the approved Directors' remuneration policy. ### **Resolution 13 – Authority to allot Ordinary shares** Resolution 13 seeks shareholder approval to authorise the Directors to issue new Ordinary shares up to an aggregate nominal amount of £9,820,130, being equivalent to 78,561,040 Ordinary shares and 20% of the total issued shares at 17 June 2024. ### **Treasury Shares** Under UK company law investment trusts are able to acquire their own shares to hold in Treasury for re-issue. The Directors consider that this facility gives the Company more flexibility in managing its share capital. At 30 April 2024 there were 50,479,828 Ordinary shares held in Treasury. ### **Resolution 14 – Dis-application or pre-emption rights** Resolution 14 seeks shareholder authority for the Company to allot shares for cash without first offering them to existing shareholders. The Company is seeking authority to allot up to 78,561,040 Ordinary shares through the issuance of new Ordinary shares or the re-issuance of shares from Treasury, being 20% of the total issued shares at 17 June 2024. The Directors issue new shares or re-issue shares from Treasury only when they believe it is advantageous to the Company's shareholders to do so and for the purpose of operating the Company's discount and premium control policy. Shares will be issued or re-issued at a premium to the net asset value at the time of sale and in no circumstances would such issue of new Ordinary shares or re-issue of shares from Treasury result in a dilution to the net asset value per share. ### **Resolution 15 – Authority to repurchase Ordinary shares** The Company's current authority to make market purchases of up to 14.99% of the issued Ordinary shares expires at the AGM. 49,244,828 Ordinary shares were bought back under this authority during the year to 30 April 2024. The Board has convened a general meeting to be held on 9 July 2024 to renew the buy-back authority until the upcoming AGM. Resolution 15, which will be proposed as a special resolution, seeks shareholder approval to renew the Company's power to purchase its own Ordinary shares for a further period until the conclusion of the Company's AGM in 2025 or on the expiry of 15 months from the passing of this resolution, whichever is the earlier. The minimum price (excluding expenses) which may be paid for each Ordinary share on exercise of the authority will not be less than the nominal value of each share or greater than the higher of (a) 105% above the average middle market quotation of those shares over the five business days before the shares are purchased and (b) the higher of the last independent trade and the highest current independent bid on the London Stock Exchange. The authority, which may be used to buy back shares either for cancellation or to be held in Treasury, will be used to purchase shares only if, in the opinion of the Directors, a purchase would be in the best interests of the shareholders as a whole and would result in an increase in the net asset value per share for the remaining shareholders. There are no outstanding options or warrants to subscribe for equity shares in the capital of the Company. Resolutions 14 and 15 would provide the Directors with the authority they need to manage Treasury shares. Treasury shares will be re-issued only at a premium to the net asset value of the shares at the time of sale. 29 Resolution 16 – Notice period for General Meetings The Company’s Articles of Association enable the Company to call General Meetings (other than an AGM) on 14 clear days’ notice. In order for this to be effective, shareholders must also approve annually the calling of meetings other than AGMs on 14 days’ notice. Resolution 16 will be proposed at the AGM to seek such approval. The approval will be effective until the Company’s next AGM, when it is intended that a similar resolution will be proposed. The Company meets the requirements for electronic voting under the Companies Act 2006, offering facilities for all shareholders to vote by electronic means. The Directors believe it is in the best interests of the shareholders for the shorter notice period to be available to the Company, although it is intended that this flexibility will be used only for early renewals of the Board’s authorities to issue or buyback shares and only where merited in the interests of shareholders as a whole. Recommendation The Board considers that the resolutions to be proposed at the AGM are in the best interests of the shareholders as a whole and recommends that they vote in favour of such resolutions, as the Directors intend to do in respect of their own beneficial holdings. By Order of the Board Juniper Partners Limited Company Secretary 28 Walker Street Edinburgh EH3 7HR 18 June 2024 30 # Corporate Governance ## Introduction The Company is run by its Board, which takes all major decisions collectively. All of the Directors regard themselves and one another as equal in the duties and responsibilities they owe to shareholders and accordingly work together as a unitary Board within which the Chairman (who is elected by the Directors from among their own number) acts as *primus inter pares*. The Directors are elected by the shareholders and regard corporate governance and accountability to shareholders as fundamental. They therefore place considerable emphasis on running the Company in the way they believe to be best suited to the successful management of an investment trust on behalf of its shareholders. Arrangements appropriate to an investment trust in respect of corporate governance have been made by the Board. The Board has considered the principles and recommendations of the AIC's Code of Corporate Governance (the 'AIC Code'). The AIC Code addresses all the principles set out in the UK Corporate Governance Code issued by the Financial Reporting Council (the 'UK Code'), as well as setting out additional principles and recommendations which are of specific relevance to investment trusts. The Board considers that reporting against the principles and recommendations of the AIC Code, which has been endorsed by the Financial Reporting Council, provides more relevant information to shareholders than if it had adopted the UK Code. The AIC Code can be obtained from the AIC's website at www.theaic.co.uk. It includes an explanation of how the AIC Code adapts the principles and provisions set out in the UK Code to make them relevant for investment companies. ## Compliance The Company has complied throughout the year, and continues to comply, with all of the recommendations of the AIC Code and the relevant provisions of the UK Code. ## Directors All of the Directors are considered to be independent in character and judgement and, in the opinion of the Board, there are no relationships or conflicts of interest which are likely to affect the judgement of any Director. Gordon Neilly has served for more than nine years. However, the Board subscribes to the view expressed within the AIC Code that long-serving Directors should not be prevented from forming part of an independent majority, and does not consider that a Director's length of tenure reduces her or his ability to act independently. The Board believes that continuity is extremely important to our shareholders and the experience Gordon brings is invaluable. Directors' fees are determined within the limits set out in the Company's Articles of Association. The approval of shareholders in a General Meeting is required to change this limit. | Director | Date of Appointment | Due date for Re-election/ election | | --- | --- | --- | | Iain Ferguson (Chairman) | 1 December 2017 | AGM 2024 | | Mandy Clements | 18 September 2020 | AGM 2024 | | Gordon Neilly | 30 April 1997 | AGM 2024 | | Paul Read | 1 December 2017 | AGM 2024 | | Robbie Robertson | 18 September 2020 | AGM 2024 | | Jean Sharp | 21 July 2016 | AGM 2024 | | Jennifer Thomas | 1 May 2024 | AGM 2024 | Any new Directors appointed during the year must stand for election at the first Annual General Meeting following their appointment. All Directors retire annually and, where appropriate, stand for re- 31 election. There is no notice period and no provision for compensation on early termination of appointment. Individual Directors may, after having obtained the consent of any other Director, seek independent professional advice at the Company’s expense on any matter that concerns the furtherance of their duties. Details of the Directors’ authority in relation to the issue and buying back by the Company of its shares can be found in the Directors’ Report. Similarly, details of those persons with significant holdings in the Company are set out in the Directors’ Report. Diversity and Inclusion The Directors consider diversity, including balance of skills, knowledge, gender, social and ethnic backgrounds, cognitive and personal strengths and experience, amongst other factors when reviewing the composition of the Board. The current Directors have a range of relevant business, financial and asset management skills and experience. Brief biographical details of the members of the Board are shown on pages 12 and 13. The Directors believe that ensuring that the Board and its Committees are comprised of the best combination of individuals to promote the success of the Company for shareholders over the long term is the priority. However, it is conscious of the diversity targets set out in the FCA Listing Rules and the AIC Code in appointing appropriately diverse, independent non- executive directors who set the operational and moral standards of the Company and aims to have an appropriate level of diversity on the Board. In accordance with Listing Rule 9.8.6R (9), (10) and (11) the Board has provided the following information in relation to its diversity as at 30 April 2024, being the financial year-end of the Company. The information included in the tables below has been obtained following confirmation from the individual Directors. As shown in the tables, the Company did not meet the FCA ethnic or gender diversity target as at 30 April 2024 but following Jennifer Thomas’s appointment on 1 May 2024 will meet the targets for the financial year ending 30 April 2025. Although the Chair of the Audit and Risk Committee is not considered to be a senior Board position for the purposes of the rules, the Board consider this to be an equivalent senior position for an investment trust and this position is held by a woman. Board gender as at 30 April 2024(1) Number of Percentage senior Board of the positions on (2) Board ethnic background as at 30 April 2024(1) Number of Percentage senior Board of the positions on (2) (1) The Company does not disclose the number of Directors in executive management as this is not applicable for an investment trust. (2) The rules state that the senior board positions consist of Chair, CEO, SID or Chief Financial Officer. As an externally managed investment trust the Company does not have the rôles of CEO or Chief Financial Officer. However, the Chair of the Audit and Risk Committee, which the Board consider to be an equivalent senior position for an investment trust is held by a woman. 32 Number of Number of White British or other white (including minority-white Men Women Prefer not to say groups) Mixed/multiple ethnic groups Asian/Asian British Black/African/Caribbean/Black British Other ethnic group, including Arab Prefer not to say the Board the Board 100.0% members members 66.7% 33.3% Board Board 4 2 2 – – – – 6 2 – – – – – – – – – – – – – – – Conflicts of Interest The Companies Act 2006 requires that a Director of the Company must avoid a situation in which he or she has, or might have, an interest that conflicts, or may conflict, with the interests of the Company. Each Director submits a list of potential conflicts prior to each meeting. The other Directors consider these and recommend whether or not each potential conflict should be authorised. No situation arose during the year whereby an interest of a Director conflicted with the interests of the Company. Meetings This year the Board agreed to refresh its committees and these are now the Nomination and Remuneration Committee, the Management Engagement Committee and the Audit and Risk Committee. During the year there were five formal Board meetings, each of which was attended by all of the Directors, save for Jean Sharp who did not attend the July meeting. There were three Audit and Risk Committee meetings, one Nomination and Remuneration Committee meeting and one Management Engagement Committee meeting held during the year. All of these meetings were attended by all of the respective committee members. Under the terms of the contracts with the AIFM and the Investment Manager, the following matters have been expressly reserved to the Board: (a) the introduction of gearing and gearing levels thereafter; (b) matters relating to share issues and buybacks; (c) matters relating to shareholder communication; (d) matters relating to the property at 28 Walker Street, Edinburgh; (e) investments in any new asset classes not already represented in the portfolio; and (f) such other matters as the Board may reasonably intimate from time to time. However, the Board is required to engage in active dialogue with the Investment Manager in relation to the matters referred to at item (c) above. The Board holds three of its meetings in Edinburgh and two in London each year. The following diagram highlights various matters considered by the Board during the past year: DIAGRAM Voting Policy As an essential part of its approach to active ownership, the Investment Manager exercises all votes in relation to the Company’s investments, updating the Board regularly on how votes have been cast. Following careful analysis of each AGM item, the Investment Manager submits votes in the direction which it believes best reflects the interests of shareholders. The Investment Manager invests only in a select universe of stocks and, as such, is able to take a considered decision on all items for voting at investee company AGMs. Communication with Shareholders The Board welcomes the views of shareholders and places considerable importance on communications with them. The Investment Manager reports back to the Board on meetings with shareholders and the Chairman and other Directors are available to meet shareholders if required. The AGM of the Company and presentations held in London provide a forum, both formal and informal, for shareholders to meet and discuss issues with the Board. Nomination and Remuneration Committee The Nomination and Remuneration Committee, chaired by Paul Read and comprising Mr Read, Mandy Clements, Iain Ferguson, Robbie Roberston, Jean Sharp and Jennifer Thomas, considers the appointment of new Directors and the fees paid to Directors. Although the Company does not have a formal policy on diversity, consideration of Board diversity forms part of the responsibilities of the Nomination and Remuneration Committee. The Board believes in the benefits of having a diverse 33 range of skills and backgrounds, including gender and length of service, on its board of Directors. All appointments will continue to be based on merit. The Nomination and Remuneration Committee meets at least annually. New Directors appointed to the Board are given an induction meeting with the Company Secretary and are provided with all relevant information regarding the Company and their duties as a Director. Thereafter, regular briefings are provided on changes in regulatory requirements that could affect the Company and the Directors. Professional advisers report from time to time and Directors will, if necessary, attend seminars covering relevant issues and developments. Management Engagement Committee The Management Engagement Committee, chaired by Iain Ferguson and comprising Mr Ferguson, Mandy Clements, Paul Read, Robbie Robertson, Jean Sharp and Jennifer Thomas (who joined the Board on 1 May 2024), is responsible for reviewing the performance of the Investment Manager and making recommendations to the Board about the continued appointment of the Investment Manager on an annual basis. The Committee also reviews the Company’s other service providers annually. The Management Engagement Committee has continued its enhanced review process in respect of its two key suppliers, the Investment Manager and Juniper. For both parties this process is led by Mandy Clements and is designed to give the Board more in depth oversight of the effectiveness of the internal processes and controls and to continue to improve the information flows between the Board and the relevant teams. Performance Review of the Board and its Committees During the year the performance of the Board, the Audit and Risk Committee, the Nomination and Remuneration Committee, the Management Engagement Committee and individual Directors was evaluated through a discussion-based assessment process led by the Chairman. The performance of the Chairman was evaluated by the other Directors. The Board concluded that the Chairman and each Director contributed effectively and demonstrated commitment to her or his role. The Board also concluded that the performance of the Board as a whole and its committees was effective. The AIC Code requires the Company to engage an external facilitator for the Board evaluation at least every three years. An external review was conducted in 2022 and therefore the next external review will be completed in the 2025 financial year. Additional Information The Company’s Articles of Association may be amended only by a special resolution passed at a General Meeting of shareholders. By Order of the Board Juniper Partners Limited Company Secretary 28 Walker Street Edinburgh EH3 7HR 18 June 2024 34 # Directors' Remuneration Report ## Statement by the Chairman This report has been prepared in accordance with the requirements of the Companies Act 2006. An Ordinary resolution for the approval of this report will be put to shareholders at the forthcoming Annual General Meeting. The Company's remuneration policy requires to be approved at every third AGM or otherwise when there has been any change to the policy. The remuneration policy was approved by shareholders at the Company's AGM in July 2023 (the resolution received 99.49% of votes for, 0.34% against, and 0.17% of votes cast were withheld). ## Nomination and Remuneration Committee The Nomination and Remuneration Committee, chaired by Paul Read and comprising Mr Read, Mandy Clements, Iain Ferguson, Robbie Roberston, Jean Sharp and Jennifer Thomas, reviews the Directors' fees on an annual basis. The terms of reference of the Nomination and Remuneration Committee clearly define the Committee's responsibilities. These terms are reviewed annually and are available for inspection on the Company's website. ## Directors' Remuneration Policy The Board's policy is that fees should be sufficient to attract and retain Directors capable of managing the Company on behalf of its shareholders. No shareholder views were sought in setting the remuneration policy although any comments received from shareholders are considered. This policy was approved by shareholders at the Company's AGM in 2023 and it is intended that it will continue until it is put to shareholders at the AGM in 2026. Non-executive Directors do not have service contracts but on being appointed are provided with a letter of appointment. Directors do not receive any pension benefits, share options, long-term incentive schemes or other benefits. ## Annual Report on Remuneration The fees paid to the Directors for the year ended 30 April 2024 were £63,000 for the Chairman, £42,000 for the Audit and Risk Committee Chair and £31,500 for each of the other Directors per annum. During the year the Remuneration Committee reviewed the level of fees paid to the Directors. This review included an analysis of the fees against the rate of increase in the Retail Price Index, payments made by other investment trusts of a similar size and structure and returns to shareholders. The Committee also considered the independent research conducted by Trust Associates on fees paid to non-executive Directors in the investment company sector. The Directors are conscious of the continued need for Board refreshment and have a desire to attract and retain the best candidates to fulfil such rôles and represent shareholders' interests. Following this review it was concluded that the fees paid to the Directors were not competitive taking into account various factors. Accordingly, the conclusion of this review was that the fees payable to the Directors for the year to 30 April 2025 should increase to £67,000 for the Chairman, £45,000 for the Audit and Risk Committee Chair and £35,000 for each of the other Directors per annum. The Board remains committed to ensuring that the Company is run efficiently and on a cost effective basis for shareholders as whole. Given the increased size of the Company the proposed increases to the Directors' fees will have no impact on the Company's ongoing charges. The annual limit on Directors' fees is set out in the Company's Articles of Association. The present limit is £302,500 in aggregate per annum and the approval of shareholders is required to change this limit. As noted on page 24, a resolution will be proposed at the AGM to increase this limit to £332,750. ## Directors' Interests (Audited) The Directors at the end of the year and their interests in the shares of the Company at 30 April 2024 and 30 April 2023 were as follows: 35 There have been no changes in the above holdings between 1 May 2024 and 18 June 2024. Directors’ Remuneration for the Year (Audited) In accordance with The Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulations 2019, the following table has been included to show the annual percentage change over the preceding financial year by comparison to the current financial year in respect of each Director. The Board will publish this annual percentage change cumulatively each year going forward until there is an annual percentage change over the five financial years preceding the financial year (with effect from 30 April 2021) in accordance with this regulation. The Directors do not receive any other payments or taxable benefits in respect of carrying out their duties. The single total figure of remuneration for each Director is detailed below, with year on year changes since the year ended 30 April 2021. (1) Iain Ferguson was appointed Chairman on 18 September 2020. (2) Mandy Clements and Robbie Robertson were appointed on 18 September 2020. (3) Robin Angus retired as Executive Director on 18 September 2020. Prior to his retirement he received a salary of £77,260 for the year ended 30 April 2021 and no additional fees or payments. (4) Hamish Buchan retired as a non-Executive Director on 18 September 2020. The rates of Directors’ fees for the year ended 30 April 2024 were set out in the Directors’ Remuneration Report contained in the Company’s 2023 Annual Report. Relative Importance of Directors’ Fees Directors’ fees and salaries as a percentage of: Further details of the Company’s expenses can be found in note 3 on page 50 and of dividends paid in note 7 on page 51. 36 | | | | 2024 2023 2024 2023 | % | | | --- | --- | --- | --- | --- | --- | | | | | | (3) (1) | (4) (2) (2) | | Directors’ fees and salaries Dividends paid Expenses Share buybacks Iain Ferguson (Chairman) Mandy Clements Gordon Neilly Paul Read Robbie Robertson Jean Sharp Expenses Share buybacks Dividends paid Iain Ferguson Mandy Clements Gordon Neilly Paul Read Robbie Robertson Jean Sharp Robin Angus Hamish Buchan Total Director Director Year ended 30 April 2024 Year ended 30 April 2023 Year ended 30 April 2022 Year ended 30 April 2021 % Change % Change % Change % Change | Beneficial Beneficial Beneficial Beneficial Beneficial Beneficial £231,000 £220,000 £179,000 £171,684 £63,000 £60,000 £50,000 £42,580 £31,500 £30,000 £25,000 £17,529 £31,500 £30,000 £25,000 £25,000 £31,500 £30,000 £25,000 £25,000 £31,500 £30,000 £25,000 £17,529 £42,000 £40,000 £29,000 £29,000 £15,046 +2,182.0 22.9% 476,901 406,986 197,443 197,009 540,000 540,000 232,467 20.0% 17.4% 20.0% 42.6% 20.0% 20.0% 20.0% 42.6% 38.0% | 5.0% 4.3% 5.0% 5.0% 5.0% 0.0% 5.0% 0.0% 5.0% 5.0% 0.0% 28,812 26,919 12,301 11,756 30,000 30,000 69,100 69,100 11,289 11,964 10,187 Interest Fees Fees Fees Fees change | +5.0 +7.0 £’000 £’000 -5.6 – – – – – – – – – – – – – – – 231 220 – – – – – – – 2024 2023 | 2.0 1.8 0.1 2.2 0.8 0.8 % % | | Approval Voting on the resolution to approve the Directors’ Remuneration Report at the Company’s AGM on 13 July 2023 was as follows: * A vote ‘withheld’ is not a vote in law, which means that the votes are not counted in the calculation of the votes for or against the resolution. Performance Graph The Company’s investment policy is to protect and increase (in that order) the value of shareholders’ funds per share over the long term. While the Company uses the FTSE All-Share Index (the ‘All- Share’) as a comparator for the purpose of monitoring performance and risk, the composition of the All-Share has no influence on investment decisions or the construction of the portfolio. The graph below requires to be included by the regulations and compares, for the ten financial years ended 30 April 2024, the share price total return (assuming all dividends were reinvested) to Ordinary shareholders in each period compared to the total shareholder return on a notional investment in the All-Share. A more detailed explanation of the performance of the Company for the year ended 30 April 2024 is given in the Chairman’s Statement and Investment Manager’s Report on pages 4 to 7. GRAPH On behalf of the Board Paul Read Director 18 June 2024 37 % % % Approve Directors’ Remuneration Report Resolution Withheld* Against 99.60 0.25 0.15 For Report of the Audit and Risk Committee Audit and Risk Committee The Audit and Risk Committee, chaired by Jean Sharp and comprising Ms Sharp, Mandy Clements, Paul Read, Robbie Robertson and Jennifer Thomas (who joined the Board on 1 May 2024), meets at least twice yearly to coincide with the annual and interim reporting cycle. The principal rôle of the Audit and Risk Committee is to review the annual and interim financial statements, the Accounting Policies applied therein and to ensure compliance with financial and regulatory reporting requirements. The Audit and Risk Committee discusses and agrees the scope of the audit plan for the year ahead and the Auditors’ Report on their findings at the conclusion of the audit. The terms of reference of the Audit and Risk Committee clearly define the Committee’s responsibilities. These terms are reviewed annually and are available for inspection on the Company’s website. The Audit and Risk Committee also reviews the system of internal controls, the terms of appointment of the Auditors (including their remuneration), the objectivity of the Auditors and the terms under which they are appointed to perform non-audit services. The Audit and Risk Committee also received a report from the Auditors identifying to its satisfaction how their independence and objectivity is maintained when providing these non-audit services. There were no such fees or services for the year ended 30 April 2024 (2023: £nil). The Audit and Risk Committee assessed the effectiveness of the audit, the quality of the team and advice received from them through reviewing interaction with the Auditors, reports received from them and discussion with management. The Audit and Risk Committee is satisfied with the effectiveness of the work provided by PricewaterhouseCoopers LLP (‘PwC’) and that PwC remain objective and independent. At the request of the Board, the Audit and Risk Committee considered whether the 2024 Annual Report was fair, balanced and understandable and whether it provided the necessary information for shareholders to assess the Company’s performance, business model and strategy. The Audit and Risk Committee is satisfied that the Annual Report is fair, balanced and understandable. The Audit and Risk Committee reached this conclusion based on a detailed review of the financial statements and subsequent discussion on whether these are fair, balanced and understandable by all members of the Committee. Audit The Company confirms that it complied with the provisions of The Statutory Audit Services for Large Companies Market Investigation (Mandatory Use of Competitive Tender Processes and Audit Committee Responsibilities) Order 2014 during the financial year ended 30 April 2024. Following a formal tender process, the Company’s external Auditors, PwC, were appointed on 19 July 2018. The Audit Engagement Partner rotates every five years in accordance with ethical guidelines and 2024 is the first year for the current partner. Internal Controls The Board is responsible for the Company’s system of internal controls and for reviewing its effectiveness. The Board has therefore established an ongoing process designed to meet the particular needs of the Company in managing the risks to which it is exposed, consistent with the internal control guidance issued by the Financial Reporting Council. The process relies principally on a risk-based system of internal control whereby a test matrix is created that identifies the key functions carried out by the Company and other service providers, the individual activities undertaken within those functions, the risks associated with each activity and the controls employed to manage those risks. A formal annual review of the Company’s risk-based system of internal controls is carried out by the Board and includes consideration of internal control reports issued by the Investment Manager and other service providers. 38 Such review procedures have been in place throughout the financial year and up to the date of approval of the Annual Report, and the Board is satisfied with their effectiveness. These procedures are designed to manage, rather than eliminate, risk and, by their nature, can provide only reasonable, not absolute, assurance against material misstatement or loss. At each Board Meeting the Board reviews the Company’s activities since the previous Board Meeting to ensure that the Investment Manager adheres to the agreed investment policy and approved investment guidelines and, if necessary, the Board approves changes to the guidelines. Juniper acts as the Company’s AIFM for the purposes of the AIFM Directive and provides secretarial, administrative and discount control services to the Company. The Company does not have an internal audit function as the Audit and Risk Committee believes that the Company’s straightforward structure does not warrant such a function. This is reviewed by the Committee annually. Significant Accounting Matters The significant issue considered by the Audit and Risk Committee during the year in relation to the financial statements of the Company was the existence and valuation of investments. The AIFM reconciles the portfolio holdings to confirmations from the Company’s Custodian on a daily basis and carries out testing of the prices obtained from the independent pricing source. Based on confirmation from the AIFM that these procedures have operated correctly at 30 April 2024 and based on conversations with and written reporting from the Depositary, the Committee is satisfied that there is no material misstatement in the context of the Annual Report. Committee Performance Review The activities of the Audit and Risk Committee were considered as part of the Board appraisal process as summarised on page 29. The process found that the Committee functioned well, with the right balance of membership, skills and experience. Jean Sharp Director 18 June 2024 39 Independent Auditors’ Report to the Members of Personal Assets Trust plc Report on the audit of the financial statements Opinion In our opinion, Personal Assets Trust plc’s financial statements: ● give a true and fair view of the state of the Company’s affairs as at 30 April 2024 and of its return and cash flows for the year then ended; ● have been properly prepared in accordance with UK-adopted international accounting standards; and ● have been prepared in accordance with the requirements of the Companies Act 2006. We have audited the financial statements, included within the Annual Report, which comprise: the Statement of Financial Position as at 30 April 2024; the Income Statement, the Statement of Changes in Equity and the Cash Flow Statement for the year then ended; and the notes to the financial statements, comprising material accounting policy information and other explanatory information. Our opinion is consistent with our reporting to the Audit and Risk Committee. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (‘ISAs (UK)’) and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We remained independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, as applicable to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. To the best of our knowledge and belief, we declare that non-audit services prohibited by the FRC’s Ethical Standard were not provided. We have provided no non-audit services to the Company in the period under audit. Our audit approach Overview Audit scope ● The Company is a standalone Investment Trust Company and engages Troy Asset Management Limited (the ‘Manager’) to manage its assets. ● We conducted our audit of the financial statements using information from Juniper Partners Limited (the ‘AIFM’) and J.P. Morgan Chase Bank N.A. (the ‘Custodian’) to whom the Board has delegated the provision of certain administrative functions. ● We tailored the scope of our audit taking into account the types of investments within the Company, the involvement of the third parties referred to above, the accounting processes and controls, and the industry in which the Company operates. ● We obtained an understanding of the control environment in place at Juniper Partners Limited, and adopted a fully substantive testing approach using reports obtained from the Administrator. 40 Key audit matters ● Valuation and existence of investments ● Income from investments Materiality Overall materiality: £16.7m (2023: £18.7m) based on 1% of Net Assets. Performance materiality: £12.5m (2023: £14.0m). The scope of our audit As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements. In particular, we looked at where the Directors made subjective judgements, for example in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. Key audit matters Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by the auditors, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters, and any comments we make on the results of our procedures thereon, were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. This is not a complete list of all risks identified by our audit. The key audit matters below are consistent with last year. We tested the valuation of the equity investments, fixed interest investments and gold bullion by agreeing the prices used in the valuation to independent third-party sources. We tested the existence of the investment portfolio by agreeing investment holdings to an independent custodian confirmation. No material misstatements were identified from this testing. Valuation and existence of investments Refer to the Report of the Audit and Risk Committee, the Accounting Policies and Notes to the Accounts. The investment portfolio at the year end principally comprised equity investments, fixed interest investments and gold bullion valued at £1,641 million. We focused on the valuation and existence of 41 investments because investments represent the principal element of the net asset value as disclosed on the Statement of Financial Position in the financial statements. Key audit matter How our audit addressed the key audit matter We found that the accounting policies implemented were in accordance with accounting standards and the AIC SORP and that income from investments has been accounted for in accordance with the stated accounting policy. We understood and assessed the design and implementation of key controls surrounding income recognition. The gains and losses on investments held at fair value comprise realised and unrealised gains and losses. For unrealised gains and losses, we tested the valuation of the Income from investments portfolio at the year-end (see Valuation and existence of Company. Refer to the Report of the Audit and Risk investments Key Audit Matter), together with testing the Committee, the Accounting Policies and Notes to reconciliation of opening and closing investments and the Accounts. agreeing the year end holdings to independent confirmation. ISAs (UK) presume there is a risk of fraud in For realised gains and losses, we tested a sample of disposal income recognition. We considered this risk to proceeds by agreeing the proceeds to bank statements and we specifically relate to the risk of overstating re-performed the calculation of a sample of realised gains investment gains and the misclassification of and losses. dividend income as capital rather than revenue In addition, we tested the accuracy of dividend receipts by due to the pressure management may feel to agreeing the dividend rates from all investments to achieve capital growth in line with the objective independent third party sources. of the We focused on the valuation of investments with respect to gains on investments and the accuracy and occurrence of dividend income recognition and its presentation in the Income Statement as sources. set out in the requirements of The Association of Investment Companies’ Statement of Recommended Practice (the ‘AIC SORP’). dividends during the year. We tested the allocation and presentation of dividend income, including special dividends, between income and capital by assessing the treatment in the context of the underlying facts and circumstances of the dividends obtained from third party sources. To test for completeness of dividend income, we tested that the appropriate dividends had been received in the year by reference to independent data of dividends declared for all relevant index data obtained independently. We also tested fixed interest income by recalculating the coupon interest, using the opening and closing portfolios and of holdings. coupon rates and maturity dates. We also agreed a sample of coupon rates and maturity dates to independent third party To test the accuracy of the indexation recognised during the recorded. period, we obtained a detailed transactional breakdown and recalculated the indexation adjustment with reference to The amortisation recognised was tested by validating data bank statements. inputs and recalculating the expected adjustment for a sample No material misstatements were identified from this testing. To test for completeness of fixed interest income, for a sample of investment holdings in the portfolio, we tested that all fixed interest income earned by investment holdings had been We tested occurrence of fixed interest income by testing that all fixed interest income recorded in the year had been earned 42 and by tracing a sample of fixed interest income received to Key audit matter How our audit addressed the key audit matter How we tailored the audit scope We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements as a whole, taking into account the structure of the Company, the accounting processes and controls, and the industry in which it operates. All audit procedures were conducted by a UK audit team. We tested and examined information using sampling and other auditing techniques, to the extent we considered necessary to provide a reasonable basis for us to form our own judgements. The impact of climate risk on our audit In conducting our audit, we made enquiries of the Directors and the Investment Manager to understand the extent of the potential impact of climate change risk on the Company’s financial statements. The Directors and Investment Manager concluded that the impact on the measurement and disclosures within the financial statements is not material because the majority of the Company’s investment portfolio is made up of level 1 investments which are valued at fair value based on market prices. We found this to be consistent with our understanding of the Company’s investment activities. We also considered the consistency of the climate change disclosures included in the Strategic Report with the financial statements and our knowledge from our audit. Materiality The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole. Based on our professional judgement, we determined materiality for the financial statements as a whole as follows: We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope of our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example in determining sample sizes. Our performance materiality was 75% (2023: 75%) of overall materiality, amounting to £12.5m (2023: £14.0m) for the Company financial statements. In determining the performance materiality, we considered a number of factors – the history of misstatements, risk assessment and aggregation risk and the effectiveness of controls – and concluded that an amount at the upper end of our normal range was appropriate. We agreed with the Audit and Risk Committee that we would report to them misstatements identified during our audit above £833,000 (2023: £935,000) as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons. Conclusions relating to going concern Our evaluation of the Directors’ assessment of the Company’s ability to continue to adopt the going concern basis of accounting included: ● evaluating the Directors’ updated risk assessment and considering whether it addressed relevant threats; 43 Rationale for benchmark applied We have applied this benchmark, which is a generally Overall Company materiality £16.7m (2023: £18.7m) How we determined it 1% of Net Assets accepted auditing practice for investment trust audits. ● evaluating the Directors’ assessment of potential operational impacts, considering their consistency with other available information and our understanding of the business and assessed the potential impact on the financial statements; ● reviewing the Directors’ assessment of the Company’s financial position in the context of its ability to meet future expected operating expenses, their assessment of liquidity as well as their review of the operational resilience of the Company and oversight of key third-party service providers; and ● assessing the implication of significant reductions in Net Assets as a result of market performance on the ongoing ability of the Company to operate. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the Company’s ability to continue as a going concern. In relation to the Directors’ reporting on how they have applied the UK Corporate Governance Code, we have nothing material to add or draw attention to in relation to the Directors’ statement in the financial statements about whether the Directors considered it appropriate to adopt the going concern basis of accounting. Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. Reporting on other information The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report thereon. The Directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities. With respect to the Strategic Report and the Directors’ Report, we also considered whether the disclosures required by the UK Companies Act 2006 have been included. Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below. Strategic Report and the Directors’ Report In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic Report and the Directors’ Report for the year ended 30 April 2024 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements. 44 In light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic Report and the Directors’ Report. Directors’ Remuneration In our opinion, the part of the Directors’ Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006. Corporate governance statement The Listing Rules require us to review the Directors’ statements in relation to going concern, longer- term viability and that part of the corporate governance statement relating to the Company’s compliance with the provisions of the UK Corporate Governance Code specified for our review. Our additional responsibilities with respect to the corporate governance statement as other information are described in the Reporting on other information section of this report. Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate governance statement is materially consistent with the financial statements and our knowledge obtained during the audit, and we have nothing material to add or draw attention to in relation to: ● The Directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks; ● The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify emerging risks and an explanation of how these are being managed or mitigated; ● The Directors’ statement in the financial statements about whether they considered it appropriate to adopt the going concern basis of accounting in preparing them, and their identification of any material uncertainties to the Company’s ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements; ● The Directors’ explanation as to their assessment of the Company’s prospects, the period this assessment covers and why the period is appropriate; and ● The Directors’ statement as to whether they have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the period of its assessment, including any related disclosures drawing attention to any necessary qualifications or assumptions. Our review of the Directors’ statement regarding the longer-term viability of the Company was substantially less in scope than an audit and only consisted of making inquiries and considering the Directors’ process supporting their statement; checking that the statement is in alignment with the relevant provisions of the UK Corporate Governance Code; and considering whether the statement is consistent with the financial statements and our knowledge and understanding of the Company and its environment obtained in the course of the audit. In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate governance statement is materially consistent with the financial statements and our knowledge obtained during the audit: ● The Directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced and understandable, and provides the information necessary for the members to assess the Company’s position, performance, business model and strategy; ● The section of the Annual Report that describes the review of effectiveness of risk management and internal control systems; and ● The section of the Annual Report describing the work of the Audit and Risk Committee. 45 We have nothing to report in respect of our responsibility to report when the Directors’ statement relating to the Company’s compliance with the Code does not properly disclose a departure from a relevant provision of the Code specified under the Listing Rules for review by the auditors. Responsibilities for the financial statements and the audit Responsibilities of the Directors for the financial statements As explained more fully in the Responsibility Statement, the Directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The Directors are also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so. Auditors’ responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below. Based on our understanding of the Company and industry, we identified that the principal risks of non- compliance with laws and regulations related to breaches of section 1158 of the Corporation Tax Act 2010, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to increase the Company’s net asset value position. Audit procedures performed by the engagement team included: ● holding discussions with the Directors, the investment manager and the administrator including consideration of known or suspected instances of non-compliance with laws and regulations and fraud; ● understanding the controls implemented by Troy Asset Management Limited (the ‘Manager’), J.P. Morgan Chase Bank N.A. (the ‘Custodian’), and J.P. Morgan Europe Limited (the ‘Depositary’) designed to prevent and detect irregularities; ● assessing the Company’s compliance with the requirements of section 1158 of the Corporation Tax Act 2010, including recalculation of numerical aspects of the eligibility conditions; ● identifying and testing journal entries, in particular year end journal entries posted by the Administrator during the preparation of the financial statements; ● reviewing relevant meeting minutes, including those of the Audit and Risk Committee; and ● designing audit procedures to incorporate unpredictability around the nature, timing or extent of our testing. 46 There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. Our audit testing might include testing complete populations of certain transactions and balances, possibly using data auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than testing complete populations. We will often seek to target particular items for testing based on their size or risk characteristics. In other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the sample is selected. A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report. Use of this report This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing. Other required reporting Companies Act 2006 exception reporting Under the Companies Act 2006 we are required to report to you if, in our opinion: ● we have not obtained all the information and explanations we require for our audit; or ● adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or ● certain disclosures of Directors’ remuneration specified by law are not made; or ● the financial statements and the part of the Directors’ Remuneration Report to be audited are not in agreement with the accounting records and returns. We have no exceptions to report arising from this responsibility. Appointment Following the recommendation of the Audit and Risk Committee, we were appointed by the members on 19 July 2018 to audit the financial statements for the year ended 30 April 2019 and subsequent financial periods. The period of total uninterrupted engagement is six years, covering the years ended 30 April 2019 to 30 April 2024. Gillian Alexander (Senior Statutory Auditor) for and on behalf of PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors Edinburgh 18 June 2024 47 Income Statement return return Total return return Total The ‘Return for the Year’ is also the ‘Total Comprehensive Income for the Year’, as defined in IAS1 (revised), and no separate Statement of Comprehensive Income has been presented. The Total column of this statement represents the Company’s Income Statement, prepared in accordance with International Financial Reporting Standards. The Revenue return and Capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. Return per share (both basic and diluted) is calculated on 367,849,279 (2023: 386,416,856) shares, being the weighted average number in issue (excluding Treasury shares) during the year. The Notes to the Accounts on pages 47 to 59, including the material accounting policies on pages 47 to 49, form part of these accounts. 48 | Calculated using the Gains/(losses) on | | | | | --- | --- | --- | --- | | | Revenue Revenue Capital Capital | | | | effective interest rate investments held at fair Foreign exchange | | | | | Other operating income value through profit or loss Return before taxation Return for the year Investment income method Other investment income Total income/(loss) Expenses Taxation Return per share (losses)/gains (54,976) (54,976) (52,217) (50,927) (14,286) (45,557) (11,289) (11,964) (13.18)p | 17,456 27,819 (8,140) (5,047) (6,242) (5,304) (6,660) (8,552) (6,992) (7,436) (6,146) (3.70)p (4,132) (4,132) 20,816 20,816 40,810 10,442 51,252 44,077 32,258 12,002 44,260 36,641 17,456 27,819 27,410 27,410 20,455 20,455 45,857 16,684 62,541 49,381 12.03p 1,290 9,419 8.77p 3.26p 1,107 1,107 3,824 1,560 9.48p 9,419 | Notes £’000 £’000 £’000 £’000 £’000 £’000 991 991 Year ended 30 April 2024 Year ended 30 April 2023 8,9 5,6 | – – – – – – – – – – 2 2 2 3 8 | ## Statement of Financial Position | | Notes | 30 April 2024 £'000 | 30 April 2023 £'000 | | --- | --- | --- | --- | | **Non-current assets** | | | | | Investments held at fair value through profit or loss | 8 | **1,640,632** | 1,805,933 | | Property | 9 | **1,730** | 1,730 | | Total non-current assets | | **1,642,362** | 1,807,663 | | **Current assets** | | | | | Receivables | 10 | **6,209** | 6,159 | | Corporation tax receivable | 10 | **1,069** | – | | Financial assets held at fair value through profit or loss | 10 | – | 24,070 | | Cash and cash equivalents | | **29,475** | 50,014 | | Total current assets | | **36,753** | 80,243 | | Total assets | | **1,679,115** | 1,887,906 | | **Current liabilities** | | | | | Financial liabilities held at fair value through profit or loss | 11 | **(8,733)** | – | | Corporation tax payable | 11 | – | (692) | | Other payables | 11 | **(3,101)** | (2,862) | | Total liabilities | | **(11,834)** | (3,554) | | Net assets | | **1,667,281** | 1,884,352 | | **Capital and reserves** | | | | | Ordinary share capital | 12 | **49,100** | 49,100 | | Share premium | | – | 1,349,680 | | Capital redemption reserve | | **219** | 219 | | Special reserve | | **1,372,145** | 22,517 | | Treasury share reserve | | **(238,314)** | (5,847) | | Capital reserve – unrealised | | **198,806** | 202,745 | | Capital reserve – realised | | **262,501** | 246,560 | | Revenue reserve | | **22,824** | 19,378 | | Total equity | | **1,667,281** | 1,884,352 | | Shares in issues at year end | 12 | **342,325,372** | 391,570,200 | | Net asset value per Ordinary share | | **487.05p** | 481.23p | The financial statements on pages 43 to 59 were approved and authorised for issue by the Board of Directors and signed on its behalf on 18 June 2024 by: ### **Iain Ferguson** Chairman The Notes to the Accounts on pages 47 to 59, including the material accounting policies on pages 47 to 49, form part of these accounts. 49 Statement of Changes in Equity share Share redemption reserve share Special reserve Revenue capital premium reserve unrealised reserve reserve realised reserve Total (4) share Share redemption reserve share Special reserve Revenue capital premium reserve unrealised reserve reserve realised reserve Total (1) See Note 7. (2) See Note 12. (3) These reserves represent distributable reserves available and intended for distribution as and when required. (4) On 24 April 2024 the Court of Session in Scotland (the ‘Court’) approved the reduction of the Company’s share premium account and the crediting of an equivalent amount to the Company’s distributable reserves. The Order of the Court approving the reduction became effective on 26 April 2024 when it was registered with the Registrar of Companies. Share premium. The share premium represents the difference between the nominal value of new Ordinary shares issued and the consideration the Company receives for these shares. Capital redemption reserve. The capital redemption reserve represents the nominal value of Ordinary shares bought back for cancellation since authority to do this was first obtained at a General Meeting in April 1999. Special reserve. The cost of any shares bought back for cancellation is deducted from the special reserve, which was created from the share premium, following General Meetings in April 1999 and in January 2024 and the subsequent Court approvals. Treasury share reserve. The net cost of any shares bought back and held in treasury. Capital reserve unrealised. Increases and decreases in the valuation of investments held at the year end and unrealised exchange differences of a capital nature are accounted for in this Reserve. Capital reserve realised. Gains and losses on the realisation of investments, realised exchange differences of a capital nature and returns of capital are accounted for in this Reserve. Revenue reserve. Any surplus/deficit arising from the revenue return for the year is taken to/from this Reserve. The Notes to the Accounts on pages 47 to 59, including the material accounting policies on pages 47 to 49, form part of these accounts 50 | Ordinary Ordinary | Treasury Treasury Capital Capital Capital Capital Capital Capital | | | | | | | --- | --- | --- | --- | --- | --- | --- | | Reduction & Cost of reduction and | | | | | | | | reclassification of Share reclassification of Share For the year ended For the year ended | | | | | | | | | | | | (1) (1) (2) (2) | (2) | (3) (3) | | Return for the year Dividends paid Share buybacks Balance at 1 May 2023 Dividends paid Share buybacks premium account premium account Balance at 30 April 2024 Balance at 1 May 2022 Return for the year Issue of Ordinary shares Balance at 30 April 2023 30 April 2024 30 April 2023 1,884,352 1,349,680 (232,467) (1,349,680) (232,467) (238,314) 1,372,145 1,667,281 1,814,360 (121,350) 1,884,352 49,100 (28,812) | (26,919) (26,919) (10,187) (10,187) 1,349,680 202,745 246,560 (28,812) 49,100 46,100 (14,286) 49,100 (3,939) (5,847) 198,806 262,501 1,235,636 324,095 176,137 121,384 1,349,680 202,745 246,560 15,941 22,517 19,378 3,000 (5,847) £’000 £’000 32,258 44,260 22,824 22,517 70,423 36,641 22,517 19,378 114,044 9,656 4,340 | £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 219 (52) (52) 219 – – – – – 219 219 – – – £’000 £’000 | – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – Distributable reserves | Distributable reserves | | | Cash Flow Statement | Year ended | | | Year ended | | | | --- | --- | --- | --- | --- | --- | | | 30 April | | | 30 April | | | | | 2024 | | | 2023 | The Notes to the Accounts on pages 47 to 59, including the material accounting policies on pages 47 to 49, form part of these accounts 51 Increase in accrued income, prepayments and other Net cash inflow from operating activities includes the Dividends received Income calculated using the effective interest rate method receivables Taxation Cash flows from investing activities Disposal of investments – equity shares Equity dividends paid Cost of share premium cancellation Net cash (outflow)/inflow from financing activities Effect of exchange rate changes Cash flows from operating activities Return before taxation (Gains)/losses on investments Foreign exchange losses/(gains) Operating cash flow before movements in working capital Decrease in other payables Net cash from operating activities before taxation Net cash inflow/(outflow) from operating activities Purchase of investments – equity shares Purchase of investments – fixed interest and other investments Disposal of investments – fixed interest and other investments Settled forward foreign exchange gains/(losses) Net cash inflow/(outflow) from investing activities Cash flows from financing activities Issue of Ordinary shares Cost of share buybacks Issue of shares from Treasury (Decrease)/increase in cash and cash equivalents Cash and cash equivalents at the start of the year Cash and cash equivalents at the year end following: Interest received (1,251,794) (260,848) (355,442) (231,984) (17,456) (27,819) (28,812) (26,919) (20,816) (45,766) (15,793) (39,670) (81,532) (10,187) (20,639) 260,144 581,996 965,581 232,144 120,090 50,014 (4,792) (8,752) (6,914) (1,576) (8,140) (9,419) (2,146) 22,785 87,324 10,831 51,252 54,976 17,112 16,817 28,571 47,944 29,475 50,014 20,199 8,050 4,132 9,598 4,768 8,065 4,340 3,646 9,974 (244) (51) (52) 100 (38) Notes £’000 £’000 – – 7 – Notes to the Accounts 1. Material Accounting Policies Basis of Accounting The financial statements of the Company have been prepared in accordance with UK-adopted International Accounting Standards and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards. This change constitutes a change in accounting framework. However, there is no impact on recognition or disclosure in the period reported as a result of the change in framework. Substantially all of the assets of the Company consist of securities that are readily realisable and, accordingly, the Directors are satisfied that the Company has adequate resources to continue in operational existence for a period of at least twelve months from the date of approval of the Financial Statements and therefore consider the going concern assumption to be appropriate. The Directors have reviewed the income and expense projections and the liquidity of the investment portfolio in making their assessment. The financial statements are presented in Sterling and all values are rounded to the nearest thousand pounds (£’000) except where otherwise indicated. The financial statements have been prepared on the historical cost basis, modified by revaluation of financial assets and financial liabilities held at fair value. The principal accounting policies adopted are set out below. These have been applied consistently, other than where new policies have been adopted. Where the presentational guidance set out in the Statement of Recommended Practice (the ‘SORP’) for investment trusts issued by the Association of Investment Companies (the ‘AIC’) in July 2022 is consistent with the requirements of IFRSs, the Directors have sought to prepare the financial statements on a basis compliant with the recommendation of the SORP. Presentation of Income Statement In order better to reflect the activities of an investment trust company, and in accordance with guidance issued by the AIC, supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented alongside the Income Statement. Income Dividends are recognised as income when the shareholders’ right to receive payment has been established, normally the ex-dividend date. Dividends receivable on equity shares where no ex-dividend date is quoted are recognised when the Company’s right to receive payment is established. Where the Company has received its dividends in the form of additional shares rather than cash, the cash equivalent of the additional shares is recognised as income. Dividends from overseas companies are shown gross of withholding tax. Special dividends are classified as either revenue or capital depending on their nature. Fixed interest returns on non-equity securities (fixed interest securities) are recognised on a time apportionment basis so as to reflect the effective yield on the investment, being amortisation of premium/accretion of discount spread over the life of the investment. For the holdings in US TipS and UK Index-linked bonds, any US/UK inflationary movement in the year is also recognised. All other interest income and other income, is accounted for on an accruals basis. Expenses All expenses are accounted for on an accruals basis. Expenses are charged to revenue except those incurred in the maintenance and enhancement of the Company’s assets and taking account of the expected long-term returns, as follows: 52 Investment management fees have been allocated 35% to revenue and 65% to capital. Transaction costs incurred on the acquisition or disposal of investments are expensed to capital. Taxation In accordance with the SORP, the marginal rate of tax is applied to taxable net revenue. Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Investments Investments are recognised and derecognised on the trade date where a purchase or sale is under a contract the terms of which require delivery within a period of time established by the market concerned, and are measured at fair value being the consideration payable or receivable. Investments are designated in terms of IFRSs as ‘‘investments held at fair value through profit or loss’’, and are measured at subsequent reporting dates at fair value, which is either the bid price or the last traded price, depending on the convention of the exchange on which the investment is quoted. Investments in Gold Bullion are valued using the London Bullion Market Association gold price which is the global benchmark price for unallocated gold delivered in London. Investments in unit trusts or OEICs are valued at the closing price released by the relevant investment manager. Any gain or loss arising from a movement in investments is included as a gain or loss on investments in the income statement as a capital item. Property Property is included at fair value. Any gain or loss arising from changes in the fair value is included in the Income Statement as a capital item. Foreign Currency Transactions denominated in foreign currencies are recorded at the actual exchange rate at the date of the transaction. Monetary assets, non-monetary assets and liabilities denominated in foreign currencies at the year end are carried at fair value by using the rate of exchange prevailing at the balance sheet date. The currencies to which the Company was exposed during the year to 30 April 2024 were Euros, Swiss Francs and US Dollars. The exchange rates applying against Sterling at 30 April were as follows: Forward currency contracts are classified as financial assets or liabilities held at fair value through profit or loss and are reported at fair value at the year end by using the forward rate of exchange prevailing at the year end. The change in fair value is recognised in the Income Statement as a capital item. The forward rates of exchange of the Company’s US Dollars to Sterling contracts at 30 April 2024, were as follows: 53 US Dollar Euro Swiss Franc 1.2490 1.2567 1.1709 1.1394 1.1482 1.1231 2024 2023 | Maturity date | Rate | | --- | --- | | **2024** | | | 15 May 2024 | 1.2670 | | 17 June 2024 | 1.2802 | | 16 July 2024 | 1.2511 | | **2023** | | | 15 May 2023 | 1.2572 | | 15 June 2023 | 1.2580 | | 14 July 2023 | 1.2586 | Any gain or loss arising from a movement in exchange rates subsequent to the date of the transaction is included as an exchange gain or loss in the Income Statement as a revenue or capital item depending on the nature of the gain or loss. ### **Cash and Cash Equivalents** Cash comprises cash in hand and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. ### **Financial Liabilities and Equity** Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is a contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Financial liabilities and equity instruments are initially recorded at the proceeds received, net of issue costs. Subsequently financial liabilities are carried at either fair value through profit or loss or at amortised cost. ### **Judgements and Sources of Estimation Uncertainty** In the application of the Company's material accounting policies, the Directors are required to make judgements, estimates and assumptions about carrying values of assets and liabilities that are not always readily apparent from other sources. The estimates and associated assumptions are based on historical experience and any other factors that are considered relevant. Actual results may vary from these estimates. The Directors do not consider that there are any such items in these financial statements. ### **Capital Management** The Company's capital management objectives are to ensure that it will be able to continue as a going concern (the going concern analysis is detailed in the Directors' Report on page 22) and to protect and increase (in that order) the value of shareholders' funds per share over the long term. The Company's capital is represented by its capital and reserves as presented in the Statements of Financial Position on page 44. The capital of the Company is managed in accordance with its investment policy, in pursuit of its business model and strategy for achieving objectives, both of which are detailed in the Strategic Report on pages 14 to 19 and the Board, with the assistance of the Investment Manager, monitors and reviews the broad structure of the Company's capital on an ongoing basis. ### **Buyback of Shares Into Treasury and Subsequent Re-issue** The cost of buying back shares into Treasury, including the related stamp duty and transaction costs, is accounted for in the Treasury share reserve. Share repurchase transactions are accounted for on a trade date basis. Where shares held in Treasury are subsequently cancelled, the nominal value of those shares is transferred out of ordinary share capital and into capital redemption reserve. The sales proceeds from the re-issue of treasury shares, less any profit or loss over the cost of acquiring the shares, is accounted for in the Treasury share reserve. Any profit or loss created from the sales proceeds over the purchase price is transferred to share premium. 54 ## 2. Income | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | **Effective interest rate calculated interest** | | | | Indexation from fixed interest securities | **17,456** | 27,819 | | | **17,456** | 27,819 | | **Other income from investments** | | | | Franked investment income | **3,423** | 3,457 | | Fixed interest securities | **18,866** | 11,461 | | Overseas dividends | **5,121** | 5,537 | | | **27,410** | 20,455 | | **Other operating income** | | | | Deposit interest | **910** | 1,057 | | Other income | **81** | 50 | | | **991** | 1,107 | | **Total income** | **45,857** | 49,381 | ## 3. Expenses | | 2024 Revenue £'000 | 2024 Capital £'000 | 2024 Total £'000 | 2023 Revenue £'000 | 2023 Capital £'000 | 2023 Total £'000 | | --- | --- | --- | --- | --- | --- | --- | | Investment Management fee^{(1)} | **3,361** | **6,242** | **9,603** | 3,586 | 6,660 | 10,246 | | Secretarial fees | **455** | – | **455** | 514 | – | 514 | | Directors' fees | **231** | – | **231** | 220 | – | 220 | | Other expenses | **218** | – | **218** | 146 | – | 146 | | Depository fees | **165** | – | **165** | 164 | – | 164 | | London Stock Exchange and regulatory fees | **161** | – | **161** | 131 | – | 131 | | Custody fees | **136** | – | **136** | 125 | – | 125 | | Savings scheme expenses | **105** | – | **105** | 128 | – | 128 | | Registrar's fees | **74** | – | **74** | 116 | – | 116 | | Printing and postage | **47** | – | **47** | 54 | – | 54 | | Irrecoverable VAT | **47** | – | **47** | 50 | – | 50 | | Auditors' remuneration for audit | **47** | – | **47** | 45 | – | 45 | | Office costs | – | – | – | 25 | – | 25 | | | **5,047** | **6,242** | **11,289** | 5,304 | 6,660 | 11,964 | (1) An amount of £2,359,000 was payable to Troy at the year end (2023: £2,610,000). Details of the Company's ongoing charges can be found at www.patplc.co.uk. ## 4. Directors' Remuneration | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Directors' fees and salaries | **231** | 220 | | Employer's national insurance | **19** | 25 | | | **250** | 245 | ## 5. Taxation | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Foreign tax suffered | **486** | 955 | | Corporate tax | **6,506** | 5,191 | | Total tax charge | **6,992** | 6,146 | The Company had no deferred tax asset as at 30 April 2024 in respect of unutilised expenses (2023: nil). 55 Capital expenses of £6,242,000 (2023: £6,660,000) have been used to offset the Company’s tax position. ## 6. Factors Affecting Tax Charge for Year The tax charge for the year is lower (2023: higher) than the standard rate of corporation tax in the UK. The differences are explained below: | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Return before tax | **51,252** | (8,140) | | Corporation tax at standard rate of 25% (2023: 19.49%) | **12,813** | (1,586) | | Effect of: | | | | Capital (gains)/losses not subject to taxation | **(4,171)** | 8,878 | | Investment income not subject to taxation | **(2,136)** | (2,101) | | Foreign tax suffered | **486** | 955 | | Total tax charge (note 5) | **6,992** | 6,146 | ## 7. Dividends | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Amounts recognised as distributions to equity holders per Ordinary share | | | | First interim dividend of 1.40p (2023: 1.40p) paid on 28 July 2023 | **5,431** | 5,278 | | Special dividend of 2.10p (2023: 1.40p) paid on 28 July 2023 | **8,146** | 5,278 | | Second interim dividend of 1.40p (2023: 1.40p) paid on 6 October 2023 | **5,290** | 5,416 | | Third interim dividend of 1.40p (2023: 1.40p) paid on 24 January 2024 | **5,064** | 5,448 | | Fourth interim dividend of 1.40p (2023: 1.40p) paid on 16 April 2024 | **4,881** | 5,499 | | | **28,812** | 26,919 | All dividends were paid from the Company’s revenue reserves. ## 8. Investments | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Listed on a recognised investment exchange: | | | | Investments | **1,431,758** | 1,627,541 | | Gold Bullion | **208,874** | 178,392 | | | **1,640,632** | 1,805,933 | | | Listed UK £'000 | Listed Overseas £'000 | Total £'000 | | --- | --- | --- | --- | | 2024 | | | | | Opening book cost | 354,594 | 1,272,250 | 1,626,844 | | Opening unrealised appreciation | 28,595 | 150,494 | 179,089 | | **Opening valuation** | **383,189** | **1,422,744** | **1,805,933** | | **Movements in the year** | | | | | Purchases at cost | 185,701 | 215,507 | 401,208 | | Effective yield adjustment^{(1)} | 6,201 | 11,255 | 17,456 | | Sales proceeds | (273,527) | (331,254) | (604,781) | | Sales – realised losses on sales | (1,140) | (6,908) | (8,048) | | Unrealised (losses)/gains on the fair value of investments during the year | (9,465) | 38,329 | 28,864 | | Total movement during the year | (92,230) | (73,071) | (165,301) | | **Closing valuation** | **290,959** | **1,349,673** | **1,640,632** | 56 | | Listed UK £'000 | Listed Overseas £'000 | Total £'000 | | --- | --- | --- | --- | | Closing book cost | 271,829 | 1,160,850 | 1,432,679 | | Closing unrealised appreciation | 19,130 | 188,823 | 207,953 | | | 290,959 | 1,349,673 | 1,640,632 | (1) See Income section of Material Accounting Policies for a fuller description. | | Listed UK £'000 | Listed Overseas £'000 | Total £'000 | | --- | --- | --- | --- | | 2023 | | | | | Opening book cost | 381,704 | 1,058,430 | 1,440,134 | | Opening unrealised appreciation | 23,811 | 326,869 | 350,680 | | **Opening valuation** | **405,515** | **1,385,299** | **1,790,814** | | **Movements in the year** | | | | | Purchases at cost | 765,556 | 502,031 | 1,267,587 | | Effective yield adjustment^{(1)} | 4,386 | 23,433 | 27,819 | | Sales proceeds | (796,716) | (429,009) | (1,225,725) | | Sales – realised (losses)/gains on sales | (336) | 117,366 | 117,030 | | Unrealised gain/(loss) on the fair value of investments during the year | 4,784 | (176,376) | (171,592) | | Total movement during the year | (22,326) | 37,445 | 15,119 | | **Closing valuation** | **383,189** | **1,422,744** | **1,805,933** | | | Listed UK £'000 | Listed Overseas £'000 | Total £'000 | | --- | --- | --- | --- | | Closing book cost | 354,594 | 1,272,251 | 1,626,845 | | Closing unrealised appreciation | 28,595 | 150,493 | 179,088 | | **Closing valuation** | **383,189** | **1,422,744** | **1,805,933** | (1) See Income section of Material Accounting Policies for a fuller description. | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Represented by: | | | | Equities | **457,794** | 451,604 | | US TIPS | **608,415** | 639,348 | | US Treasuries | **193,377** | 279,369 | | UK Gilts | **116,636** | 257,220 | | UK Index-linked Bonds | **55,536** | – | | Gold Bullion | **208,874** | 178,392 | | | **1,640,632** | 1,805,933 | | Realised (losses)/gains on sales | **(8,048)** | 117,030 | | Unrealised gains/(losses) on the fair value of investments during the year | **28,864** | (171,592) | | Realised gains/(losses) on foreign exchange | **28,671** | (41,237) | | Unrealised (losses)/gains on foreign exchange | **(32,803)** | 50,656 | | Gains/(losses) on investments | **16,684** | (45,143) | #### Transaction costs During the year the Company incurred transaction costs of £187,198 (2023: £32,802) on the purchase of investments and £27,124 (2023: £104,650) on the sale of investments. 57 ## 9. Property | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Opening cost | **2,144** | 2,144 | | Acquisitions | – | – | | Closing cost | **2,144** | 2,144 | | Opening revaluation | **(414)** | – | | Revaluation in year | – | (414) | | Closing valuation | **1,730** | 1,730 | The property is used as the Company's offices. ## 10. Current Assets | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Financial Assets | | | | Fair value of forward currency contracts | – | 24,070 | | Receivables | | | | Accrued income | **6,076** | 6,044 | | Tax receivable | **1,069** | – | | Prepayments and other receivables | **133** | 115 | | | **7,278** | 6,159 | ## 11. Current Liabilities | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | **Financial Liabilities** | | | | Fair value of forward currency contracts | **8,733** | – | | **Payables** | | | | Corporation tax payable | – | 692 | | Due to brokers | **484** | – | | Other payables | **2,617** | 2,862 | | | **3,101** | 3,554 | ## 12. Ordinary Share Capital | | Number | £'000 | | --- | --- | --- | | Allotted, called-up and fully paid Ordinary shares of 12.50p each: | | | | Balance at 1 May 2022 | 368,806,900 | 46,100 | | Shares issued during the year | 23,998,300 | 3,000 | | Shares bought back and held in Treasury | (2,160,000) | – | | Treasury shares re-issued | 925,000 | – | | Balance at 1 May 2023 | 391,570,200 | 49,100 | | Shares bought back and held in Treasury | (49,244,828) | – | | Balance at 30 April 2024 | 342,325,372 | 49,100 | As at 30 April 2024, the total number of Ordinary shares of 12.50p of the Company in issue were 392,805,200, of which 50,479,828 Ordinary shares are held in Treasury. Therefore, the total number of ordinary shares with voting rights in the Company is 342,325,372. During the year 49,244,828 shares were bought back and held in Treasury at a cost of £232,467,000. ## 13. Business Instruments The Directors are of the opinion that the Company is engaged in the single business of investing in equity shares, fixed interest securities and other investments. 58 14. Financial Instruments The Company holds investments in listed companies, fixed interest securities and physical gold, holds cash balances and has receivables and payables. It may from time to time also invest in FTSE 100 Futures and enter into forward currency contracts. Cash balances are held for future investment and forward currency contracts are used to manage the exchange risk of holding foreign investments. Further information is given in the Strategic Report for the Year to 30 April 2024 on pages 14 to 19. The fair value of the financial assets and liabilities of the Company at 30 April 2024 and at 30 April 2023 is not different from their carrying value in the financial statements. The Company is exposed to various types of risk that are associated with financial instruments. The most important types are credit risk, liquidity risk, interest rate risk, market price risk and foreign currency risk. The Board reviews and agrees policies for managing its risk exposures. These policies are summarised below and have remained unchanged for the year under review. Credit Risk Credit risk is the risk that an issuer or counterparty will be unable or unwilling to meet a commitment that it has entered into with the Company. The Company’s principal financial assets are investments, cash balances and other receivables, the carrying value of which represents the Company’s maximum exposure to credit risk in relation to financial assets. The Company is exposed to potential failure by counterparties to deliver securities for which the Company has paid, or to pay for securities which the Company has delivered. A list of pre-approved counterparties used in such transactions is maintained and regularly reviewed by the Company, and transactions must be settled on a basis of delivery against payment. Broker counterparties are selected based on a combination of criteria, including credit rating, balance sheet strength and membership of a relevant regulatory body. Risk relating to unsettled transactions is considered to be small because of the short settlement period involved and the credit quality of the brokers used. All of the assets of the Company, other than cash deposits and receivables, are held by J.P. Morgan Chase Bank N.A., the Company’s Custodian, acting as a delegate of J.P. Morgan Europe Limited which has been appointed as the Company’s Depositary. Bankruptcy or insolvency of the Custodian might cause the Company’s rights with respect to the securities held by the Custodian to be delayed or limited. The Board monitors the Company’s risk by reviewing the Custodian’s internal control reports on a regular basis. The credit risk on cash balances and derivative financial instruments is limited because the counterparties are banks with high credit ratings, rated A or higher, assigned by international credit rating agencies. Bankruptcy or insolvency of such financial institutions might cause the Company’s ability to access cash placed on deposit to be delayed or limited. Credit risk and exposure is spread between three counterparties, with a maximum limit of 4% of the Company’s net assets to be held at each, subject to an overall limit of 10% of the Company’s net assets. Market Price Risk The fair value of equity and other financial securities held in the Company’s portfolio fluctuates with changes in market prices. Prices are themselves affected by movements in currencies and interest rates and by other financial issues including the market perception of future risks. The Company’s strategy for the management of market price risk is driven by the Company’s investment policy as outlined within the Strategic Report on pages 14 to 19. The Board sets policies for managing this risk and meets regularly to review full, timely and relevant information on investment performance and financial results. The management of market price risk is part of the fund management process and is fundamental to investment. The portfolio is managed with an awareness of the effects of adverse price movements in markets with an objective of maximising overall returns to shareholders. Investment and 59 portfolio performance are discussed in more detail in the Investment Manager's Report and the investment portfolio is set out on page 8. Any changes in market conditions will directly affect the profit or loss reported through the Income Statement. For instance, a 30% increase in the value of the investment exposure at 30 April 2024 would have increased net return and net assets for the year by £492,190,000 (2023: a 30% increase in the value of the investment exposure would have increased net return by £541,780,000). A decrease of 30% (2023: 30%) would have had an equal but opposite effect. These calculations are based on investment valuations at the respective balance sheet date and are not representative of the year as a whole. ### **Liquidity Risk** Liquidity risk is the risk that the Company will encounter in realising assets or otherwise raising funds to meet financial commitments. The risk of the Company not having sufficient liquidity at any time is not considered by the Board to be significant, given the liquid nature of the portfolio of investments and the level of cash and cash equivalents ordinarily held. The Investment Manager reviews liquidity at the time of each investment decision. The Board reviews liquidity exposure at each meeting. All of the Company's financial liabilities at 30 April 2024 had a maturity period of less than three months. ### **Interest Rate Risk** Some of the financial instruments held by the Company are interest bearing. As such, the Company is exposed to interest rate risk resulting from fluctuations in the prevailing market rate. ### **Floating Rate** When the Company holds cash balances, such balances are held on overnight deposit accounts and call deposit accounts. The benchmark rate which determines the interest payments received on cash balances is the bank base rate, which at 30 April 2024 was 5.25% in the UK (2023: 4.25%). Floating interest rate exposure at 30 April: | | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Sterling | 29,436 | 49,732 | | US Dollar | 39 | 282 | | | 29,475 | 50,014 | Considering effects on cash balances, an increase of 100 basis points (2023: 100 basis points) in interest rates would have increased net assets and income for the period by £295,000 (2023: £500,000). A decrease of 100 basis points (2023: 100 basis points) would have had an equal but opposite effect. The calculations are based on the cash balances at the Statement of Financial Position date and are not representative of the year as a whole. ### **Fixed rate and zero rate** The Company may from time to time hold fixed interest or zero interest investments. As at 30 April 2024, the Company held none of these type of investments (2023: none). ### **Maturity profile** The maturity profile of the Company's fixed interest or zero interest investments at the Statement of Financial Position date was as follows: 60 | At 30 April 2024: | Within 1 year £'000 | Within 1-5 years £'000 | More than 5 years £'000 | | --- | --- | --- | --- | | US TIPS | 96,725 | 291,936 | 219,754 | | US Treasuries | 193,377 | – | – | | UK Index-linked Bonds | – | 55,536 | – | | UK Gilts | 21,163 | 95,473 | – | | | 311,265 | 442,945 | 219,754 | | At 30 April 2023: | Within 1 year £'000 | Within 1-5 years £'000 | More than 5 years £'000 | | --- | --- | --- | --- | | US TIPS | 67,337 | 264,818 | 307,193 | | US Treasuries | 279,369 | – | – | | UK Gilts | 211,349 | 45,871 | – | | | 558,055 | 310,689 | 307,193 | ## Foreign Currency Risk The Company invests in overseas securities and holds cash in overseas currencies. | Gross currency exposure at 30 April: | 2024 £'000 | 2023 £'000 | | --- | --- | --- | | Euros | **51,463** | 19,845 | | Swiss Francs | **43,860** | 55,685 | | US Dollars^{(1)} | **1,254,390** | 1,347,496 | (1) At 30 April 2024 the Sterling cost of a portion of the US Dollar denominated assets (including US Treasury Inflation Protected Securities ('TIPS') and US equities) was protected by a forward currency contract. The fair value of negative £8,733,000 (2023: fair value of positive £24,070,000) on the US$792,299,000 (2023: US$851,395,000) sold forward against £625,456,000 (2023: £700,944,000) is included in financial liabilities (2023: financial assets). All foreign exchange contracts in place at 30 April 2024 were due to mature within three months. The exposure to US Dollars as shown above also includes Gold Bullion. At 30 April 2024 the net exposure to US Dollars was £620,600,000 (2023: £670,623,000) including Gold Bullion and £411,326,000 (2023: £492,231,000) excluding Gold Bullion. ## Foreign Currency Sensitivity The following table illustrates the sensitivity of the total return for the year and net assets in relation to the Company's overseas monetary financial assets and financial liabilities. It assumes a 10% depreciation of Sterling against the Euro, Swiss Franc and US Dollar. The sensitivity analysis is based on the Company's monetary foreign currency financial instruments held at each balance sheet date. If Sterling had weakened by 10% against the currencies shown, this would have had the following positive effect: ### Income Statement – return on ordinary activities after taxation: | | 2024 | | | 2023 | | | | --- | --- | --- | --- | --- | --- | --- | | | Revenue £'000 | Capital £'000 | Total £'000 | Revenue £'000 | Capital £'000 | Total £'000 | | Euros | **122** | **5,146** | **5,268** | 44 | 1,985 | 2,029 | | Swiss Francs | **144** | **4,386** | **4,530** | 146 | 5,569 | 5,715 | | US Dollars | **2,936** | **62,893** | **65,829** | 3,619 | 64,655 | 68,274 | | Canadian Dollars | **12** | – | **12** | – | – | – | | | **3,214** | **72,425** | **75,639** | 3,809 | 72,209 | 76,018 | A 10% strengthening of Sterling against the above currencies would have had an equal but opposite effect on the return after taxation. 61 ## 15. Financial Instruments Measured at Fair Value | Description | 2024 | | | | 2023 | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | Level 1 £'000 | Level 2 £'000 | Level 3 £'000 | Total £'000 | Level 1 £'000 | Level 2 £'000 | Level 3 £'000 | Total £'000 | | Investments | 1,640,632 | – | – | 1,640,632 | 1,805,933 | – | – | 1,805,933 | | Financial (liabilities)/assets | – | (8,733) | – | (8,733) | – | 24,070 | – | 24,070 | | Total | 1,640,632 | (8,733) | – | 1,631,899 | 1,805,933 | 24,070 | – | 1,830,003 | Level 1 reflects financial instruments quoted in an active market. The Company's investment in Gold Bullion has been included in this level. Level 2 reflects financial instruments the fair value of which is evidenced by comparison with other observable current market transactions in the same instrument or based on a valuation technique the variables of which include only data from observable markets. The Company's forward currency contract has been included in this level as fair value is achieved using the foreign exchange spot rate and forward points which vary depending on the duration of the contract. Level 3 reflects financial instruments the fair value of which is determined in whole or in part using a valuation technique based on assumptions that are not supported by prices from observable market transactions in the same instrument and not based on available observable market data. There have been no changes to valuation technique over the year. ## 16. Related Party Transactions Investment management services are provided by Troy Asset Management Limited. The fee for the year ended 30 April 2024 was £9,603,000 (2023: £10,246,000). An amount of £2,359,000 was outstanding to the Investment Manager at 30 April 2024 (2023: £2,610,000). Directors of the Company received fees for their services. An amount of £19,000 was outstanding to the Directors at 30 April 2024 (2023: £18,000). Further details are provided in the Directors' Remuneration Report on pages 30 to 32. The Directors' shareholdings are also detailed on pages 12, 13 and 26. ## 17. Alternative Investment Fund Managers Directive ('AIFMD') (unaudited) In accordance with the AIFMD, information in relation to the Company's leverage and the remuneration of the Company's AIFM, Juniper, is required to be made available to investors. In accordance with the Directive, the AIFM's remuneration policy and remuneration disclosures in respect of the year ended 30 April 2024 are available from Juniper on request. The Company's maximum and actual leverage levels at 30 April are shown below: | | Gross Method | Commitment Method | | --- | --- | --- | | **2024** | | | | Maximum limit | 200% | 200% | | Actual | 136% | 138% | | **2023** | | | | Maximum limit | 200% | 200% | | Actual | 133% | 136% | There have been minor amendments to the Company's investor disclosure document in the year to 30 April 2024. The investor disclosure document and all additional periodic disclosures required in accordance with the requirements of the FCA Rules implementing the AIFMD in the UK are made available on the Company's website (www.patplc.co.uk). 62 ## Notice of Annual General Meeting Notice is hereby given that the forty-third Annual General Meeting ('AGM') of Personal Assets Trust Public Limited Company will be held at The Kimpton Charlotte Square Hotel, 38 Charlotte Square, Edinburgh EH2 4HQ on Friday 19 July 2024 at 12 noon. Shareholders will be asked to consider, and, if thought fit, pass resolutions 1 to 13 which will be proposed as ordinary resolutions, and resolutions 14 to 16 which will be proposed as special resolutions. 1. That the Report and Accounts for the year to 30 April 2024 be received. 2. That the Directors' Remuneration Report for the year to 30 April 2024 be approved. 3. That the Dividend Policy of the Company as set out in the Annual Report be approved. 4. That Iain Ferguson, who retires from office annually, be re-elected as a Director. 5. That Gordon Neilly, who retires from office annually, be re-elected as a Director. 6. That Paul Read, who retires from office annually, be re-elected as a Director. 7. That Jean Sharp, who retires from office annually, be re-elected as a Director. 8. That Mandy Clements, who retires from office annually, be re-elected as a Director. 9. That Robbie Robertson, who retires from office annually, be re-elected as a Director. 10. That Jennifer Thomas be elected as a Director. 11. That PricewaterhouseCoopers LLP be reappointed as Auditors and that the Directors be authorised to determine their remuneration. 12. To increase the aggregate limit on Directors' remuneration from £302,500 to £332,750 per annum. 13. Authority to allot Ordinary shares That, in substitution for any existing authority, but without prejudice to the exercise of any such authority prior to the date hereof, the Directors of the Company be and they are hereby generally and unconditionally authorised in accordance with Section 551 of the Companies Act 2006 (the 'Act') to exercise all the powers of the Company to allot shares in the Company and to grant rights to subscribe for or to convert any security into shares in the Company ('Securities') provided that such authority shall be limited to the allotment of shares and the grant of rights in respect of shares with an aggregate nominal value of up to £9,820,130 (being approximately 20% of the nominal value of the issued share capital of the Company as at 17 June 2024), such authority to expire at the conclusion of the next Annual General Meeting of the Company after the passing of this resolution or on the expiry of 15 months from the passing of this resolution, whichever is the earlier, unless previously revoked, varied or extended by the Company in a general meeting, save that the Company may at any time prior to the expiry of this authority make an offer or enter into an agreement which would or might require Securities to be allotted or granted after the expiry of such authority and the Directors shall be entitled to allot or grant Securities in pursuance of such an offer or agreement as if such authority had not expired. 14. Disapplication of pre-emption rights That, in substitution for any existing power but without prejudice to the exercise of any such power prior to the date hereof, the Directors of the Company be and they are hereby generally empowered, pursuant to Section 570 and/or Section 573 of the Companies Act 2006 (the 'Act'), to allot equity securities (within the meaning of Section 560 of the Act), for cash pursuant to the authority given by Resolution 13 above or by way of a sale of treasury shares for cash as if Section 561(1) of the Act did not apply to any such allotment of equity securities, provided that this power: 63 (a) expires at the conclusion of the next Annual General Meeting of the Company after the passing of this resolution or on the expiry of 15 months from the passing of this resolution, whichever is the earlier, save that the Company may, before such expiry, make an offer or agreement which would or might require equity securities to be allotted after such expiry and the Directors may allot equity securities or sell treasury shares in pursuance of any such offer or agreement as if the power conferred hereby had not expired; and (b) shall be limited to the allotment of equity securities up to an aggregate nominal value of £9,820,130 (being approximately 20% of the nominal value of the issued share capital of the Company as at 17 June 2024). 15. Authority to repurchase Ordinary shares That, in substitution for any existing authority but without prejudice to the exercise of any such authority prior to the date hereof, the Company be and is hereby generally and unconditionally authorised, pursuant to and in accordance with Section 701 of the Companies Act 2006 (the 'Act'), to make market purchases (within the meaning of Section 693(4) of the Act) of fully paid Ordinary shares in the capital of the Company (either for retention as Treasury shares for future re-issue, resale or transfer or for cancellation), provided that: (a) the maximum aggregate number of Ordinary shares hereby authorised to be purchased is 50,452,348, representing 14.99% of the issued Ordinary share capital of the Company (excluding shares held in treasury) as at 17 June 2024, being the latest practicable date before this notice, or if lower, such number of Ordinary shares equal to 14.99% of the issued Ordinary share capital as at the date of the passing of this resolution; (b) the minimum price (excluding expenses) which may be paid for each Ordinary share shall be the nominal value of that share; (c) the maximum price (excluding expenses) which may be paid for each Ordinary share shall not be greater than the higher of: (i) 105% above the average middle market quotation on the London Stock Exchange of an Ordinary share over the five business days immediately preceding the date of purchase; and (ii) the higher of the last independent trade and the highest current independent bid on the London Stock Exchange; and (d) unless previously varied, revoked or renewed by the Company in a General Meeting, the authority hereby conferred shall expire at the conclusion of the Company's next Annual General Meeting or on the expiry of 15 months from the passing of this resolution, whichever is the earlier, save that the Company may, prior to such expiry, enter into a contract to purchase Ordinary shares under such authority which will or might be completed or executed wholly or partly after the expiration of such authority and may make a purchase of Ordinary shares pursuant to any such contract. 16. Notice of General Meetings That a General Meeting of the Company other than an Annual General Meeting may be called on not less than 14 clear days' notice provided that this authority shall expire at the conclusion of the next Annual General Meeting of the Company. By Order of the Board Juniper Partners Limited Company Secretary 28 Walker Street Edinburgh EH3 7HR 18 June 2024 64 Notes 1. A shareholder who is entitled to attend, speak and vote at the meeting is entitled to appoint one or more proxies to attend, speak and vote on her or his behalf. Such proxy need not also be a shareholder of the Company. If appointing more than one proxy, each proxy must be appointed to exercise rights attaching to different shares held by the shareholder. 2. A proxy form for use by shareholders at the meeting is enclosed with this document. Proxies must be lodged with the Company’s registrar, Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA, not less than 48 hours (excluding non-working days) before the time appointed for the meeting together with any power of attorney or other authority (if any) under which it is signed. Completion of the proxy form will not prevent a shareholder from attending the meeting and voting in person. 3. As an alternative to completing the hard copy proxy form you can appoint a proxy electronically at www.sharevote.co.uk. For an electronic proxy appointment to be valid, your appointment must be received by the Company’s registrar not less than 48 hours (excluding non-working days) before the time of the meeting. 4. Only those shareholders having their names entered on the Company’s share register not later than 6.30 pm on 17 July 2024 or, if the meeting is adjourned, 6.30 pm on the day which is two days (excluding non-working days) prior to the date of the adjourned meeting, shall be entitled to attend and vote at the meeting in respect of the number of shares registered in their name at that time. Changes to the entries on the Company’s share register after that time shall be disregarded in determining the rights of any shareholder to attend, speak and vote at the meeting, notwithstanding any provision in any enactment, the Articles of Association of the Company or other instrument to the contrary. 5. Any corporation which is a shareholder may appoint one or more corporate representatives who may exercise on its behalf all of its powers as a shareholder provided that such corporate representatives do not do so in relation to the same shares. 6. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for the meeting and any adjournment(s) thereof by using the procedures described in the CREST Manual, and by logging on to the website www.euroclear.com. CREST personal members or other CREST sponsored members, and those CREST members who have appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf. In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a ‘CREST Proxy Instruction’) must be properly authenticated in accordance with Euroclear UK & Ireland Limited’s specifications, and must contain the information required for such instruction, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy, must, in order to be valid, be transmitted so as to be received by the Company’s Registrar, Equiniti Limited (ID RA19), by no later than 12 noon on 17 July 2024. No such message received through the CREST network after this time will be accepted. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST application host) from which the Company’s Registrar is able to retrieve the message by inquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means. CREST members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed a voting service provider(s), to procure that her or his 65 CREST sponsor or voting service provider(s) take(s) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001. 7. The right to appoint a proxy does not apply to persons whose shares are held on their behalf by another person and who have been nominated to receive communications from the Company in accordance with Section 146 of the Companies Act 2006 ('Nominated Persons'). Nominated Persons may have a right under an agreement with the member who holds the shares on their behalf to be appointed (or to have someone else appointed) as a proxy. Alternatively, if Nominated Persons do not have such a right, or do not wish to exercise it, they may have a right under such an agreement to give instructions to the person holding the shares as to the exercise of voting rights. The statement of the rights of members in relation to the appointment of proxies in notes 1 and 2 above does not apply to Nominated Persons. The rights described in these notes can be exercised only by members of the Company. 8. If you are an institutional investor you may be able to appoint a proxy electronically via the Proximity platform, a process which has been agreed by the Company and approved by the Registrar. For further information regarding Proximity, please go to www.proximity.io. Your proxy must be lodged by 12 noon on 17 July 2024 in order to be considered valid. Before you can appoint a proxy via this process you will need to have agreed to Proximity's associated terms and conditions. It is important that you read these carefully as you will be bound by them and they will govern the electronic appointment of your proxy. 9. At 17 June 2024, the latest practicable date prior to publication of this document, the Company's issued share capital comprised 392,805,200 Ordinary shares of 12.50p each of which 56,231,828 Ordinary shares are held in Treasury. Therefore, the total number of shares with voting rights in the Company is 336,573,372. 10. Any person holding 3% of the total voting rights in the Company who appoints a person other than the Chairman as her or his proxy must ensure that both he or she and such third party comply with their respective disclosure obligations under the Disclosure Guidance and Transparency Rules. 11. Information regarding the meeting, including information required by Section 311A of the Companies Act 2006, is available from the Company's website, www.patplc.co.uk. 12. Under Section 319A of the Companies Act 2006, the Company must answer any question relating to the business being dealt with at the meeting put by a member attending the meeting unless: (a) answering the question would interfere unduly with the preparation for the meeting or involve the disclosure of confidential information; (b) the answer has already been given on a website in the form of an answer to a question; or (c) it is undesirable in the interests of the Company or the good order of the meeting that the question be answered. 13. Shareholders are advised that, unless otherwise stated, any telephone number, website or e-mail address which may be set out in this notice of meeting or in any related documents (including the proxy form) is not to be used for the purposes of serving information or documents on, or otherwise communicating with, the Company for any purposes other than those expressly stated. 14. The members of the Company may require the Company (without payment) to publish, on its website, a statement (which is also to be passed to the Auditors) setting out any matter relating to the audit of the Company's accounts, including the Auditors' report and the conduct of the 66 audit. The Company will be required to do so once it has received such requests from either members representing at least 5% of the total voting rights of the Company or at least 100 members who have a relevant right to vote and hold shares in the Company on which there has been paid up an average sum per member of at least £100. Such requests must be made in writing and must state the sender’s full name and address and be sent to the Company’s registered address at 28 Walker Street, Edinburgh EH3 7HR. 15. The letters of appointment of the Directors will be available for inspection at the registered office of the Company during normal business hours on any weekday (Saturdays, Sundays and public holidays excepted) from the date of this notice and at the location of the meeting for at least 15 minutes prior to the meeting and during the meeting. 16. Members meeting the threshold requirements set out in the Companies Act 2006 have the right (a) to require the Company to give notice of any resolution which can properly be, and is to be, moved at the meeting pursuant to section 338 of the Companies Act 2006; and/or (b) to require the Company to include a matter in the business to be dealt with at the meeting, pursuant to section 338A of the Companies Act 2006. 67 Glossary of Terms and Alternative Performance Measures The European Securities and Markets Authority (‘ESMA’) has published guidelines on Alternative Performance Measures (‘APM’). APMs are defined as being 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 accounting framework. The APMs where detailed below are used by the Board to assess the Company’s performance against a range of criteria and are viewed as particularly relevant for an investment trust. Alternative Investment Fund An Alternative Investment Fund (‘AIF’) is a collective investment undertaking, including investment compartments thereof, which (a) raises capital from a number of investors, with a view to investing it in accordance with a defined investment policy for the benefit of those investors; and (b) does not require authorisation under the UCITS regime. The Company is an AIF. Alternative Investment Fund Manager An Alternative Investment Fund Manager (‘AIFM’) is an entity that provides certain investment services, including portfolio and risk management services. The Company has appointed Juniper Partners Limited as its AIFM. Benchmark Index A Benchmark Index is a standard against which the performance of a security, investment company, or investment manager can be measured. The Company uses the FTSE All-Share Index, RPI and CPI as comparators for the purpose of monitoring performance and risk. However, the composition of the FTSE All-Share Index has no influence on investment decisions or the construction of the portfolio. Discount or Premium (APM) The amount, expressed as a percentage, by which the Company’s share price is less than (discount) or greater than (premium) the net asset value per share of the Company. Earnings per Share Earnings per share are calculated by dividing the net income return attributable to equity shareholders by the weighted average number of shares in issue (excluding shares held in Treasury) during the year. Middle Market Price The middle market price is the mid-point between the buy and the sell prices of the Company’s shares. Net Asset Value (‘NAV’) per Share (APM) The value of the Company’s net assets (total assets less total liabilities) divided by the number of shares in issue (excluding shares held in Treasury). NAV/Share Price Total Return (APM) NAV/Share price total return measures the increase/(decrease) in NAV per share/share price including any dividends paid in the period, which are assumed to be reinvested at the time that the share price is quoted ex-dividend. 68 Closing NAV per share Closing share price (Discount)/premium c = (b – a) ÷ a 30 April 2024 30 April 2023 487.05p 483.00p 481.23p 481.00p (0.8%) (0.0%) (c ) (b) (a) | | 2024 | | 2023 | | | --- | --- | --- | --- | --- | | | NAV | Share price | NAV | Share price | | Closing NAV per share/share price | (a) 487.05p | 483.00p | 481.23p | 481.00p | | Dividend adjustment factor† | (b) 1.00090 | 1.01677 | 1.01307 | 1.01437 | | Adjusted closing NAV per share/share price | (c=a x b) 487.49p | 491.10p | 487.52p | 487.91p | | Opening NAV per share/share price | (d) 481.23p | 481.00p | 491.95p | 503.00p | | **Total Return (c ÷ d) -1** | 1.3% | 2.1% | (0.9%) | (3.0%) | † Based on total dividends paid for the year ended 30 April 2024 of 7.70p* per share (2023: 7.00p*). ### Ongoing Charges Ratio (APM) The sum of the management fee and all other administrative expenses expressed as a percentage of the average daily net assets during the year. | | 30 April 2024 £'000 | 30 April 2023 £'000 | | --- | --- | --- | | Management fee | **9,603** | 10,246 | | Other administrative expenses | **1,686** | 1,718 | | Total | (a) **11,289** | 11,964 | | Average daily net assets | (b) **1,745,924** | 1,842,393 | | **Ongoing charges c = (a ÷ b) x 100** | (c) **0.65%** | 0.65% | ### Ordinary Dividend per Share (APM) A distribution of earnings by the Company to its shareholders. Details of the Company's historical dividend payments are shown on page 3. ### Treasury Shares Ordinary shares of the Company that have been repurchased by the Company and not cancelled but held in Treasury. These shares do not pay dividends, have no voting rights, and are excluded from the NAV per share calculation. 69 Corporate Information Board of Directors Data Protection Iain Ferguson CBE (Chairman) The Company is committed to ensuring the Mandy Clements privacy of any personal data provided to it. Gordon Neilly Further details of the Company’s privacy policy Paul Read can be found on the Company’s website Robbie Robertson www.patplc.co.uk Jean Sharp Jennifer Thomas Shareholder Information Website: www.patplc.co.uk Registered Office Telephone: 0131 378 0500 28 Walker Street Edinburgh EH3 7HR Registrar Telephone: 0131 378 0500 Equiniti Limited Aspect House Company Secretary Spencer Road | Juniper Partners Limited | Lancing | | --- | --- | | 28 Walker Street | West Sussex BN99 6DA | | Edinburgh EH3 7HR | Telephone: +44 (0)371 384 2459* | | Telephone: 0131 378 0500 | Website: www.shareview.co.uk | | Alternative Investment Fund Manager | Stockbroker | | Juniper Partners Limited | J.P. Morgan Cazenove | | 28 Walker Street | 25 Bank Street | | Edinburgh EH3 7HR | Canary Wharf | London E14 5JP Investment Manager Independent Auditor Troy Asset Management Limited | 33 Davies Street | PricewaterhouseCoopers LLP | | --- | --- | | London W1K 4BP | Atria One | | www.taml.co.uk | 144 Morrison Street | Edinburgh EH3 8EX Custodian Identification Codes J.P. Morgan Chase Bank N.A. | 25 Bank Street | SEDOL: BM8B5H0 | | --- | --- | | Canary Wharf | ISIN: GB00BM8B5H06 | | London E14 5JP | Bloomberg: PNL LN | EPIC: PNL Depositary Global Intermediary Identification J.P. Morgan Europe Limited Number (GIIN) 25 Bank Street Canary Wharf 2W8KH5.99999.SL.826 London E14 5JP Legal Entity Identifier (LEI) Solicitor 213800Z7ABM7RLQ41516 Dickson Minto WS * Lines open 8:30am to 5:30pm, Monday to Friday. 16 Charlotte Square Edinburgh EH2 4DF 70 Personal Assets Trust plc, 28 Walker Street, Edinburgh EH3 7HR Shareholder Telephone: 0131 378 0500 Website: www.patplc.co.uk 71