TIDMOIT
RNS Number : 3202P
Odyssean Investment Trust PLC
09 June 2020
ODYSSEAN INVESTMENT TRUST PLC
(the "Company", the "Trust" or "OIT")
LEI: 213800RWVAQJKXYHSZ74
Annual Report and Financial Statements for the year ended 31
March 2020
The full Annual Report and Financial Statements and the Notice
of the AGM can be accessed via the Company's website at
www.oitplc.com or by contacting the Company Secretary on 01392
477500.
Financial Highlights As at As at
31 March 2020 31 March 2019 Change %
Shareholders' funds GBP80.1m GBP85.0m (5.8)
NAV per share 90.8p 96.3p (5.7)
Share price per share 90.0p 99.3p (9.4)
Discount/ premium
to NAV (0.9)% 3.1%
Annualised ongoing
charges 1.7% 1.6%
Performance Highlights
-- Resilient performance over the period through volatile
markets with the NAV decreasing by 5.7% compared with the NSCI ex
IC plus AIM Total Return Index(1) which fell by 23.2%
-- Since inception, the Trust has delivered a NAV Total Return
of -7.7%, compared with the fall of the NSCI ex IC plus AIM Total
Return Index of -30.1%
-- Takeover of portfolio holdings Consort Medical and Huntsworth
during the period at premiums of 39% and 50% respectively
-- In line with the commitment made in the IPO Prospectus, 50%
of profits from recent takeovers of portfolio holding Huntsworth
(GBP1.1m) will be made available to buy back shares at the Board's
discretion, as the average discount exceeded 5% for 60 days prior
to exit
-- The Portfolio Manager believes that the Company's portfolio
companies have sufficient liquidity to manage through the crisis,
assuming COVID-19 lockdown is eased in a progressive way through
the summer
-- Strong Balance Sheet to capitalise on pricing anomalies and
fundraisings, which the Portfolio Manager anticipates over the next
few months
Jane Tufnell, Chairman of OIT, said:
"I am pleased to present the Annual Report and Financial
Statements for the Company covering the period from 1 April 2019 to
31 March 2020.
The net assets of the Company decreased by GBP5m to GBP80m and
represented a decline in net asset value per share ("NAV") of 5.7%.
Whilst the decline is disappointing, it represents an extremely
resilient performance during a very challenging period for UK
equities. Over the same period, the comparator NSCI ex IC plus AIM
Total Return Index fell by 23.2% and the FTSE All-Share declined by
18.5%.
At the end of the period, the Company was 90% invested in 19
quoted smaller companies, one of which is quoted outside the UK.
The takeover of Huntsworth completed in May 2020, converted this 6%
position into cash. The Company ended the period with considerable
resources to deploy into new investments."
1 The NSCI ex IC plus AIM Total Return Index is used as a
comparator but not a benchmark.
For further information, please contact:
Stuart Widdowson, Odyssean Capital 07710 031620
Neil Langford, Winterflood Securities
(Corporate Broker) 020 3100 0160
Sarah Gibbons-Cook, Quill PR (Media 020 7466 5060
Agency) OIT@quillpr.com
About Odyssean Investment Trust PLC
Odyssean Investment Trust PLC is a self-managed closed-ended
investment trust that seeks to deliver attractive returns to its
clients by investing in great businesses and supporting them to
become even better. To achieve this, the Board has appointed
Odyssean Capital LLP to manage the portfolio.
Odyssean Capital LLP invests in a concentrated portfolio of well
researched smaller companies, typically too small for inclusion in
the FTSE 250. Constructive corporate engagement is a key part of
Odyssean's approach, drawing on the investment team's lengthy and
successful track record in this area.
Financial Summary
Results for the year 31 March 2020 31 March 2019* Change
-------------------------------- -------------- --------------- -------
Shareholders' funds GBP80.1m GBP85.0m (5.8)%
NAV per share 90.8p 96.3p (5.7)%
Share price per share 90.0p 99.3p (9.4)%
Share price (discount)/premium
to NAV(#) (0.9)% 3.1%
Year ended Period ended
31 March 31 March 2019*
2020
------------------------------------- ----------- ---------------
Revenue earnings per ordinary share 0.6p (0.6)p
Capital earnings per ordinary share (6.2)p (1.4)p
Total earnings per ordinary share (5.6)p (2.0)p
Year ended Period ended
High/low 31 March 2020 31 March 2019*
--------------------- -------- -------------- ---------------
NAV - high 116.5p 99.8p
- low 81.6p 93.4p
Share price - high 117.0p 107.5p
- low 76.0p 95.3p
Share price premium
to NAV - high 3.1% 9.7%
- low (15.3)% (1.3)%
Year ended Period ended
Performance 31 March 2020 31 March 2019*
------------------------------------------- -------------- ---------------
NAV Total Return per share(#) (5.7)% (2.1)%
NSCI ex IC plus AIM Total Return Index(#) (23.2)% (9.0)%
Year ended Period ended
Cost of running the Company 31 March 2020 31 March 2019*
------------------------------- -------------- ---------------
Annualised ongoing charges(#) 1.7% 1.6%
* The period from incorporation of the Company on 21 December
2017 to 31 March 2019. The Company commenced trading and listed on
the LSE on 1 May 2018.
(#) Alternative Performance Measures (see Glossary below).
Comparator Benchmark (see Glossary below).
Past performance is not a guide to future performance.
Investment objective and policy
The full text of the Company's investment objective and policy
is set out in the full Annual Report and Financial Statements.
Strategic Report
Chairman's Statement
Introduction
I am pleased to present the Annual Report and Financial
Statements for the Company covering the period from 1 April 2019 to
31 March 2020.
Performance
The net assets of the Company decreased by GBP5m to GBP80m and
represented a decline in net asset value per share ("NAV") of 5.7%.
Whilst the decline is disappointing, it represents an extremely
resilient performance during a very challenging period for UK
equities. Over the same period, the comparator NSCI ex IC plus AIM
Total Return Index (the "Comparator Index") fell by 23.2% and the
FTSE All-Share declined by 18.5%.
Given the concentrated nature of the portfolio, performance has
been driven largely by individual stocks. Portfolio companies
Consort Medical and Huntsworth were bid for during the period,
accelerating returns. The Portfolio Manager's conservative approach
to investment (namely, running with a net cash balance) helped to
defend the NAV during the challenging markets at the end of the
period. Our NAV outperformed the Comparator Index in each month
from January to March 2020.
At the end of the period, the Company was 90% invested in 19
quoted smaller companies, one of which is quoted outside the UK.
The takeover of Huntsworth completed in May 2020, converted this 6%
position into cash. The Company ended the period with considerable
resources to deploy into new investments.
The team continues to identify potential new investment
opportunities as well as engaging with the ongoing due diligence
and monitoring of existing holdings. It has been pleasing to see
some of the results of the team's engagement becoming visible.
Since IPO, OIT's NAV has decreased by 7.7%, this compares to the
fall in the Comparator Index of more than 30% over the same period.
This differentiated performance outcome gives the Board great
confidence in the Portfolio Manager's investment strategy, approach
and execution.
Discount and premium management
The share price has remained resilient since IPO and at the
period end was trading at less than a 1% discount to NAV. The
average discount across the sector at the end of the period was
c.14.5%. The Board believes that the Company's rating is driven by
a number of factors, including but not limited to:
- efforts undertaken at the Company's launch to build the right
shareholder base who share the Company's view that patient
investors will be rewarded in the longer term;
- the differentiated investment performance;
- the shareholder friendly measures in place to allow all
shareholders to opt for a cash exit at a price based around NAV
every seventh year following the Company's launch, allied with the
commitment to repurchase shares following a corporate action, as
set out below.
The Board and Portfolio Manager have been aware of the discount
volatility experienced over the recent quarter. The takeover of
Huntsworth gave rise to profits of c.GBP2.1m compared with where
the shares were trading the day immediately before the bid
announcement. The 2018 prospectus included a provision to make
available 50% of any profits made following a corporate action to
buy back shares in OIT, should the average discount exceed 5% over
a 60-day period prior to exit. The discount narrowly exceeded 5%
over this period and as a result, GBP1.05m will be used at the
Board's discretion to buy back shares at a wider discount than 5%.
Subsequent to the year end, we have used this discretion as set out
in the Extracts from the Directors' Report below.
The Portfolio Management fee is charged on the lower of NAV or
market capitalisation. As a result, if the Company's shares trade
at a discount to NAV, the management fee and ongoing costs to
shareholders fall. This mechanism helps reduce fee drag in
challenging markets where the Company's shares are likely to trade
at a discount, as well as ensuring the Portfolio Manager's
interests are aligned with shareholders.
Dividend
The Directors expect that returns for shareholders will be
primarily driven by capital growth of the shares rather than
dividend income. The Board is not proposing to pay a final
dividend.
Service Providers
The Board has reviewed its service providers and following the
recent review at the Management Engagement Committee meeting of 21
May 2020, it has agreed to appoint Frostrow Capital LLP as its
company secretary, administrator and marketing facilitator. The
Company will release an announcement upon their formal appointment
which is expected to take effect from mid-July 2020. The Board
would like to thank Link for their work and support at the time of
the IPO and to date.
Growth of the Company
The Board is aware that liquidity is important for investors and
in order to remain relevant, the Company will need to grow. The
Board believes that OIT's investment strategy and strong
performance will have broad appeal among investors which will
enable it to grow over time, however, the current market
environment presents near-term challenges in achieving this
objective. OIT's strong relative rating should enable us to pursue
issuance in due course and the Board continues to consider growth
options.
Annual General Meeting
The Company's AGM is scheduled for 22 September 2020 at the
offices of Odyssean Capital LLP, 6 Stratton Street, Mayfair, London
W1J 8LD at 10.30 am. The Board looks forward to meeting
shareholders. In due course, a notice of AGM will be circulated in
accordance with the requirements of the Company's Articles of
Association.
Due to the current COVID-19 outbreak, many companies have either
postponed their AGMs or made alternative arrangements for
conducting these meetings. We hope that by 22 September 2020 the
Company will be able to hold its AGM in the usual manner. However,
given the uncertain nature of this situation, should the Company
need to alter its AGM arrangements, it will communicate these
changes to shareholders through a regulatory announcement. This
information will also be made available on the Company's website
www.oitplc.com. Shareholders are advised to check the website to
ensure they have the most up-to-date information available
regarding the AGM.
Outlook
The coming weeks and months will determine what sort of recovery
domestic and international economies, and individual companies,
will experience following the lockdown actions taken by numerous
governments. In spite of the considerable fiscal and monetary
support, it is highly unlikely that corporate earnings will
suddenly bounce back to historic peak levels experienced in
2019.
It is possible that the considerable change people are
experiencing, both in terms of their work and also their
consumption habits, will lead to changes in living and buying
behaviours. Agile management teams managing high quality companies
will benefit from these changes. Less robust business models and
businesses are likely to suffer permanent damage.
One of the attractions of investing in smaller quoted companies
is that the larger number of companies affords more choice than
investing in a basket of the FTSE100. Allied to that, the Company's
differentiated investment approach with a concentrated portfolio
enables the Portfolio Manager to be extremely selective when
considering where to deploy the Company's capital.
The closed-ended nature of the Company is a key enabler of the
differentiated investment strategy. Inflows/outflows are more
measured and controlled by the Board, in consultation with the
Portfolio Manager, than a daily dealing open-ended investment fund,
enabling the Portfolio Manager to take a long-term view and also
maintain cash balances should it wish to do so. In addition, the
portfolio is not subject to the UCITS concentration rules that
open-ended investment companies must follow. Both of these factors
enable the Portfolio Manager to invest in less liquid smaller
companies for the long term and engage effectively with the
portfolio companies as an aligned long-term stakeholder.
The Portfolio Management team has many years' relevant
experience, which will help navigate the Company's existing
portfolio through these difficult times. This experience, allied
with their longstanding knowledge of many of the other quoted
smaller companies eligible for investment, and their stakeholders,
means that they have a clear plan and strategy of how to hone the
portfolio as well as selectively deploy capital over the coming
weeks and months.
The Portfolio Manager's conservative approach to gearing since
launch and price discipline has led to the Company having
considerable cash and near cash resources to deploy into the
current dislocated market. Notwithstanding the short-term
uncertainties and volatility, long-term returns from this point are
likely to reward holders well.
As the COVID-19 crisis emerged in the UK, the Portfolio Manager
enacted its Business Continuity Plan and the team has been working
from home since 11 March 2020. The Portfolio Manager's remote
systems are working as planned and day-to-day portfolio management
is unaffected. With face-to-face meetings not possible, the
Portfolio Manager has been using conference and video calls to
engage with the management teams of portfolio companies.
There has continued to be regular dialogue between the Board and
the Portfolio Manager regarding the portfolio and matters impacting
the Company.
We are very grateful for the support shown by the shareholders
over the past year and their continuing support through these
unprecedented times.
Jane Tufnell
Chairman
8 June 2020
Portfolio Manager's Report
The investment approach
- Our investment approach applies the core elements of the
private equity investment philosophy -highly focused, long-term,
engaged 'ownership' style investment - to public markets. We
believe that this approach creates a portfolio unlike that of many
typical public equity funds and that, well executed, can offer
attractive, differentiated, risk-adjusted returns.
- Highly concentrated portfolio: We look to build a highly
concentrated portfolio of no more than 25 investee companies where
we carry out intensive diligence, only investing behind our highest
conviction ideas.
- Narrow focus: We are focused on smaller companies typically
too small for inclusion in the FTSE 250 index. We believe this
market is less efficient, offering more opportunities to find
mis-pricings. Further, we believe the best investment decisions are
made from a base of knowledge and experience, and we will make the
majority of investments in industry sectors that we and our
advisors, know well (TMT, Services, Industrials and
Healthcare).
- Targeting long-term holding periods: We will evaluate each
investment opportunity over a three to five-year investment
horizon. We have structured our business to reflect this belief and
do not intend to run any capital which is redeemable over short
time periods. To think like an 'owner' of a business we believe
your capital should behave like one too.
- Engaged investment style: We are engaged investors. We like
investing in companies which, whilst good, are underperforming
their potential and where we see the opportunity for constructive
corporate engagement to unlock improved sustainable returns for all
stakeholders.
The Company's investment objective is to deliver long-term
capital growth rather than outperform a specific index. Our
differentiated investment approach is likely to lead to periods of
NAV per share performance materially different to those of the
broader market. We fully anticipate this potential short-term
performance variance and will focus on comparative investment
performance on a rolling three-year basis.
The absolute return mentality of the strategy, allied with the
desire to avoid being a forced seller, may lead to net cash
balances being held. We anticipate a core range of 5-15% over the
long term. Net cash balances will not be used as an attempt to
market time, but to enable us to invest where blocks of stock are
available rather than being required to sell a less liquid holding
on short notice.
Implementing the investment strategy
There are three key factors we look for when we analyse a
potential investment:
1) a valuation opportunity;
2) in a higher-quality company; and
3) with improvement potential.
Our view is that buying at a fair price and supporting improved
performance generates capital growth, while our quality filters
mitigate losses in the event of unexpected headwinds.
Valuation
We look for two valuation factors in every investment. Firstly,
what we refer to as "static value" - does the company trade at a
discount to its current value? This is not only judged by
traditional public market ratios. We also seek to model every
company through the lens of a private equity buyer as well as
evaluating its attractiveness to strategic trade buyers.
Secondly, we are looking for companies which can grow their
value over time - "dynamic value". We particularly look for
situations where there are multiple, independent drivers of value
creation present, and where management actions can unlock these. We
believe seeking multiple value drivers makes an investment case
more secure and less exposed to single areas of uncertainty or
misjudgement.
Quality
We assess every potential investment against qualitative and
quantitative criteria. The quality assessment is important to
mitigate the risk of permanent capital destruction from investments
which fail to achieve their value potential. In our experience,
higher quality companies are likely to maintain a minimum value
through difficult times and are able to attract high calibre
management teams to rectify
underperformance.
Improvement potential and engagement
We particularly like companies that are in some way
underperforming relative to their potential, and where the current
valuation does not price in improvement. Once invested,
constructive corporate engagement can help to unlock value. Our
mantra is to buy good businesses and sell excellent businesses. The
spectrum of areas which can be improved is broad and includes
operating performance, asset utilisation, overly complex business
structures/organisation, strategic direction, poor M&A,
investor relations and finally, governance and pay.
Integration of ESG into our investment process
We have historically focused on evaluating and engaging on
corporate governance ("G") and financial performance as part of our
investment process.
However, we have considered Environmental ("E") and Social ("S")
performance and sustainability of investee companies informally for
some time. After consulting with shareholders, we have decided to
integrate E&S formally into our investment process and
engagement approach.
In common with our approach to governance, we will not use
negative screening. However, our investment approach tends to avoid
companies which screen badly for E&S factors - e.g. resources;
sub prime lending, and we aim to avoid business models which are
unsustainable or performing extremely badly on E&S issues.
We intend to take a pragmatic approach to E&S given the more
resource constrained nature of smaller quoted companies, largely
focusing on how boards approach sustainability, where the scope for
improvement is, how progress is evaluated and how it is reported to
investors.
Progress and performance in the past year
The past year has seen UK equity markets show the extremes of
sentiment. Greed after the decisive UK election result. Fear
through March 2020 as investors began to process the likely impact
that COVID-19, and global governments' reactions to containing it,
would have on company earnings. For investors, the year has been
the equivalent to experiencing four seasons in one day.
As an example of this changing sentiment, the NSCI ex IC plus
AIM Total Return Index rallied 12.6% during Q4 2019, before falling
almost 33% in Q1 2020. To put these sharp moves into perspective,
from 1955 to the end of March 2020, the annualised returns from the
larger NSCI Index have been c.14% per annum (source: Numis
Securities).
Over the year to March 2020, the NAV of the Company decreased by
5.7%, compared with the NSCI ex IC plus AIM Total Return Index
(which we use as a comparator but not a benchmark) which fell by a
much more significant 23.2% across the period. The portfolio was on
average 88% invested across the period.
During the many years of managing this strategy in differing
market conditions, we have typically found that most relative
outperformance is generated in periods of down or sideways markets,
whereas the NAV tends to lag, or just about keep up, during periods
when the markets are exuberant. This has been our experience over
the past year and indeed since the Company was launched.
We believe that there are a number of factors behind this
differentiated performance profile, including but not limited to
(a) the maintenance of a net cash position in the portfolio, (b)
the investment process and stock selection criteria, and (c) the
focus on seeking absolute returns rather than relative returns. The
latter approach led us to increase our cash position during the
first half of Q1 2020, not because we saw the oncoming turmoil
driven by COVID-19, but because a number of portfolio companies had
generated strong returns through Q4 2019. This performance was
largely driven by re-ratings, and future value growth was unlikely
to meet our absolute return requirements other than by further
material re-ratings, which appeared too optimistic. As a result,
the portfolio had considerable liquidity and cash resources as the
market turmoil accelerated.
At the end of the period, the Company was 90% invested into a
portfolio of 19 companies. Over the last year, six new positions
were added and two smaller positions exited. Three of the new
positions were added during Q1 2020, through the market
turmoil.
Two full disposals were made during the period, including the
takeover of Consort Medical, which completed in February 2020. Both
investments delivered total returns in excess of 40%, with holding
periods of less than a year.
In March 2020, Huntsworth announced a recommended bid from a
highly regarded US private equity house, at a 50% premium to the
closing share price. Whilst a welcome uplift in current markets, we
felt that the bid was opportunistic and at a reasonable discount to
intrinsic value. Nevertheless, we were somewhat satisfied with a
c.38% IRR which was a good result given current market
conditions.
We believe that the two takeovers validate our investment
approach. Whilst we do not select investments anticipating them
being acquired, over the years many investee companies have been
taken over by trade and financial buyers. We see this as either an
accelerated return, or alternatively a safety parachute when either
a company has a short term set back or is struggling to attract an
appropriate rating as a public company.
Towards the end of the period, the likely disruption from
COVID-19 became apparent. In February, we evaluated the portfolio
for likely direct and indirect impacts of the lock down in China.
As March progressed, we widened this analysis, focusing on
portfolio companies' balance sheets, debt facilities and available
liquidity. In the vast majority of cases, whilst short-term
earnings may be impacted, we concluded that the balance sheets in
the main were strong enough to tide over a sudden sharp
deterioration in sales. Where balance sheets were less strong, but
the business models robust and the competitive positions strong, we
have indicated a desire to back any equity raises if needed.
From the beginning of the current financial year, we have also
decided to formally integrate Environmental and Social engagement
with portfolio companies into our investment process. Whilst we
have informally considered "E&S" alongside our typical focus on
Governance and Financial Performance, we believe that now is the
appropriate time to broaden our engagement. This has been supported
by a number of the Company's largest shareholders.
Portfolio development
The portfolio was largely stable through the period with few
major changes. GBP28m was invested into stock purchases. Six new
positions were started for a total investment of GBP13m, we see
scope to grow these over time as we continue our diligence. The
remaining GBP15m was invested into existing positions, both growing
weightings in those names where diligence supported an increased
position, and actively topping up names on share price weakness
where the investment thesis remained robust.
Up until the end of 2019, our focus had been on investing in
less cyclical companies with strong balance sheets. Two of the
three new investments made during March 2020 were in more cyclical
companies, where the share prices were extrapolating a pessimistic
short and long-term view of trading. The other investment was a
more highly geared non-cyclical company which had de-rated
materially on, we believed, overblown concerns around the level of
gearing. We do not think it needs to raise equity to strengthen its
balance sheet and believe it has very strong underlying cashflows,
operates in a growth market and has robust earnings. It was
purchased at a forward P/E of less than 7x earnings, compared with
a long-term trading range of 9-23x.
Whilst a small position, the takeover of our holding in Consort
Medical was welcomed. We were part way through our due diligence to
build the position and one of our hesitations, despite valuation,
was, whether the two disparate divisions would attract a trade
bidder. We could find multiple buyers for each business and
considered whether the company should be broken up to release
value. We also evaluated the significant de-rating that had
occurred in the months prior to our investment. The company had
experienced disrupted manufacturing and had limited short-term
earnings growth potential. This was allied with limited free
cashflow due to substantial investments. It was notable that the
company did not attract a competing bid, despite the takeover being
made at a share price below the recent peak.
As indicated in the interim results, we have also spent more
time seeking to drive value from portfolio companies. It is
pleasing to note some early progress in this area, particularly
around investor relations and stakeholder management. We believe
that many of the portfolio companies have multiple opportunities
for improvement.
Portfolio
At the end of the period under review, the portfolio comprised
19 companies, the largest positions being NCC, SDL, Equiniti and
Chemring. Backgrounds to our investment thesis for each company
have been detailed in our prior reports and key updates through the
period are detailed below:
NCC Group
% NAV: 13%
Sector: TMT
Leading independent provider of software escrow services and
cyber security consulting provided through the Assurance
division.
Performance in period
NCC performed well during the period with trading updates
broadly supporting delivery of the key points of our investment
thesis. The Assurance division delivered strong organic growth
(notably in the US market) with consultant numbers growing strongly
and consultant attrition reducing across the period.
The Escrow business performance was more disappointing. Revenues
showed moderate decline, predominantly driven by internal
challenges at NCC, which have since been addressed. With investment
in the sales team and the launch of the new 'escrow as a service'
product, the company is confident that this division will return to
growth.
The self-help programme being driven by management continues to
progress, reflected by ongoing improvements in margins which rose
200bps in the Assurance division in FY19. Significant investment
has been made in back office functions and systems. We see these as
key enablers to the group in further accelerating growth and
improving margins.
Outlook
The COVID-19 crisis will impact NCC's divisions differently. The
highly recurring Escrow business is expected to continue with
limited impact. The Assurance division is more exposed to delays in
projects as end clients look to reduce spend. This impact should be
short lived and management are actively managing through this
difficult time. The current situation of increased remote working
may also stimulate new business opportunities. For example, it was
recently reported that NCC had been hired to help video
conferencing company Zoom improve its cyber security.
We believe that NCC has a robust balance sheet and will trade
through this period. The markets in which it operates enjoy
long-term secular growth drivers, there remains a large self-help
opportunity to be delivered and the unique assets in the group have
significant value. The long-term prospects for the company appear
attractive.
SDL
% NAV: 12%
Sector: TMT
Global leader in provision of content translation services and
also develops and sells a range of software products that support
the content translation workflow for linguists and enterprises.
Performance in period
SDL continued its robust performance through the period, driving
further confidence in our investment thesis. The group delivered
strong trading updates with organic revenue growth of 5%, 90bps
increase in margins and strong cash generation in FY19.
More importantly, the group demonstrated continued delivery
against its self-help programme. Use of the group's internally
developed Helix workflow platform increased to 84% of addressable
volume, supporting further efficiency gains in the core Language
Services division, driving improved margins and increased customer
satisfaction. Significant R&D investment into the group's
software offering (and machine translation capabilities) are
beginning to bear fruit with key products being delivered in the
year and successfully sold to clients. Finally, the integration of
the acquired US-based business, 'Donnelly Language Services' is
largely complete and supported a significant mix shift in group
revenues to higher margin, premium industry verticals.
Outlook
SDL is well placed to weather headwinds from COVID-19, with net
cash on balance sheet and recent back office investments supporting
efficient remote working. Although demand from end customers may
slow, SDL is positioned to benefit in what remains a fragmented
market where smaller, less well capitalised competitors may
struggle.
SDL's combination of a leading position in a growth market,
clear margin improvement potential and strong cash generation have
the potential to generate good returns from here over the long
term.
Equiniti
% NAV: 11%
Sector: Business Services
Leading provider of a range of services that support complex and
regulatory processes. These include shareholder registration,
remediation services and pension administration.
Performance in period
Equiniti's performance has been mixed over the period. On the
positive side, the group demonstrated improved cash conversion with
fewer exceptional costs, good progress on delivery of $10m
synergies from its US acquisition and signs of improvement in the
long challenged pensions business.
Offsetting this were headwinds from lower UK corporate activity
driven by Brexit concerns and cuts in interest rates by both the
Bank of England and the Federal Reserve. Resultant organic growth
of 1.4% in FY19 was below ambitions of 3%-7%, with revenue mix
holding back the expected progression in margins.
Outlook
Equiniti is exposed to a number of short-term impacts from
COVID-19. Falling interest rates, dividends being cancelled and
reduced corporate activity will all impact revenues. There is
prospect of recovering some of this lost revenue if there are
widespread rights issues amongst FTSE350 companies through the rest
of the year. The company is looking to manage costs and cash in
light of this challenge. The business carries reasonable leverage
but has liquidity headroom and a robust, recurring base of core
revenue to trade through the near-term disruption.
Longer term, we continue to view the attractions of the business
model as undervalued by the market. Equiniti is a market leader,
with high recurring revenue, strong cash generation and the
opportunity to accelerate organic growth, through turnaround of the
pensions business and leveraging its recently acquired US
footprint. The loss of interest income caused by the cut in rates
may lead to Equiniti and its peers revisiting their pricing models
for certain services. Other activities that are suffering from the
current market conditions are likely to recover as 2020
progresses.
Chemring Group
% NAV: 8%
Sector: Industrials
Chemring produces counter-measures for aircraft, sophisticated
sensor products, and energetic devices including rocket components
and provides contracted R&D for governments - primarily serving
the defence sector.
Performance in period
Chemring showed good progress across the period - with the new
CEO bedding in well. The business completed the disposal of its
lower quality commoditised energetics businesses, leaving the
continuing group focused on higher value-add products. The company
saw a successful re-start of the explosion-impacted facility in
Salisbury, strengthening end demand in the countermeasures market
and continuing progress in its Sensors division against a pipeline
of key projects.
Full year results were ahead of market expectations with revenue
up 13%, improving margins, strong cash generation and a growing
order book providing solid support for FY20. Post the period end,
the company has confirmed it will pay its final dividend.
Outlook
Chemring's defence market exposure leaves it well placed to
trade through any near term COVID pressure. The bulk of revenue
comes from already approved defence budgets. With the exception of
possible delays in customers physically signing off on orders,
there is limited expected impact on demand, and to date, Chemring
has seen little disruption of its facilities or supply chains.
Longer term, we see the disposal of the commodity energetics
businesses as leaving a higher quality group, well placed to
benefit from recent investments in ramping up capacity to serve
counter-measures to the growing global F-35 fleet. We also see
further upside from the pipeline of large contracts with US
Department of Defense where key decision points are expected in the
next 12-24 months.
We have six mid-sized investments in Huntsworth, Volution,
Flowtech, Devro, Benchmark, and Clinigen. Clinigen is a new
position, built during the past six months. Our investment thesis
is detailed below. The investment cases for the other names have
been described in prior reports.
Huntsworth
% NAV: 6%
Sector: Healthcare
Huntsworth is primarily focused on the provision of healthcare
communications services. The group provides marketing and technical
medical communications services to healthcare clients across all
steps of drug development to commercial sale.
Performance in period
The key news through the period was the announcement of a bid
for the company by private equity house CD&R in March.
The offer price of 108p, although a 50% premium to the then
share price, was slightly below our view of fair value. Despite
this, the bid offered an attractive return (c.38% IRR) in a
relatively short period, which when combined with the ongoing
uncertainty in markets we viewed as attractive.
Volution
% NAV: 5%
Sector: Industrials
Volution is a leading designer, assembler and marketer of
ventilation fans and systems for use in domestic households and
commercial environments. The group has operations across Europe and
Australasia.
Performance in period
Volution showed a year of good progress. Operationally, the
highlight of the year was the completed relocation of two UK
facilities into a single new site in Reading. Following a period of
execution challenges, this success allowed the group to focus on
delivering benefits from the increased capacity this investment
offers.
Pleasingly, full year trading showed solid organic growth of
3.5% in the year ended July 2019, boosted further by acquisitions
in the Nordics and Australasia. Margins, which dipped slightly at
full year, showed a solid 70bps uplift in the first half of FY20 as
the benefits from restructuring at the Reading facility and the
streamlining of back office functions came through.
Key governance developments were a new CFO being bought on board
in August 2019 and a new Chairman in January 2020. We look forward
to their continuing the steady stewardship of what is a well-run
business.
Outlook
Volution's reliance on construction and refurbishment spend has
left it exposed in the near term to the sudden drop in activity due
to COVID-19. The group has limited gearing and sufficient liquidity
to cover a protracted period of minimal revenue, positioning it
well to trade through the current issues. More positively, we see
significant opportunity for Volution to win share through the
crisis at the expense of smaller, more challenged competitors. It
has become a more geographically balanced business since the 2008-9
downturn, which provides more resilience to earnings.
Over the longer term, we are excited by the prospects for
Volution. Regulatory drivers for improved energy efficiency in
homes are driving increased need for ventilation, which Volution is
well placed to serve. After a period of operational investment, the
company should now see improving margins, supporting strong ongoing
cash generation. With a track record of successful bolt-on M&A
in a market which remains highly fragmented there are multiple
routes to value growth open to the business.
Flowtech Fluidpower
% NAV: 5%
Sector: Business Services
Leading UK distributor of hydraulic and pneumatic
components.
Performance in period
Throughout calendar year 2019, Flowtech faced a deteriorating
end market as Brexit concerns drove softness in its key industrial
end sectors. This slowdown accelerated into the end of the year
driving downgrades to market expectations. In addition, it is one
of the portfolio companies most impacted by the COVID-19 related
lockdown.
Against this disappointing backdrop, we are pleased to note a
number of actions taken by the company in response to these
challenges. Firstly, the business has announced a focus on
delivering efficiencies through better integration of legacy
acquisitions. We believe there is opportunity for cost savings
through rationalising multiple separate warehousing and picking
sites into fewer, more efficient centres, alongside further savings
from bringing together multiple back office processes. In the
context of the group, we believe the total potential quantum of
savings is material.
Secondly, there have been recent governance changes at the
company with the appointment of a new Chairman. We view these
changes as positive and supportive of delivering the operational
transformation ongoing at the group over the next few years.
Outlook
Demand in Flowtech's end markets has been and will be impacted
by the current COVID-19 lockdown, driving a likely material
short-term impact on revenues. The group will benefit from
government support schemes and has suspended dividends which will
support short-term liquidity. The group also intends to accelerate
the cost savings identified as part of managing through current
issues. On a positive side, many of Flowtech's competitors are much
smaller and are likely to struggle to conduct business in the
current environment. It would not be a surprise if Flowtech gains
considerable market share through this period.
Fundamentally, we believe Flowtech occupies a unique position in
its market with significant potential to create value. The shift to
a proactive focus on delivering cost savings, has the potential to
drive a material uplift in earnings as well as create a stronger
operating platform from which the group can continue to build on
its market leadership position through M&A. We remain excited
by the medium to long-term prospects for the business.
Devro
% NAV: 5%
Sector: Consumer
Devro is a global market leader in the production of artificial
collagen-based casings for sausages and other snack products.
Performance in period
Devro had a solid year of performance broadly in line with
expectations. The business reported flat volumes and a small
revenue decline in 2019, with profit largely maintained by the
successful delivery of cost savings identified as part of
management's efficiency plan. Pleasingly, strong cash generation
saw net debt reduce through the period.
The management continues to impress by focusing on reducing
costs and streamlining what was historically a highly autonomous
group of local operations. This was further demonstrated by the
announcement during the year of the planned rationalisation of one
UK site with a potential GBP5m p.a. cost saving as a result -
further supporting a key leg of our investment case.
Delivery of sustained organic volume growth remains the key
challenge for Devro, significant investment in the commercial
function in 2019, alongside roll out of the new 'Fine Ultra'
product range, were key actions to start delivery against this
goal.
Outlook
Being largely a supplier into food manufacture, Devro is
reasonably insulated from the demand shocks other companies have
seen from COVID-19. The business should benefit from demand
shifting from foodservice to retail. In addition, to date it has
seen little supply side disruption, although there are raw material
risks relating to the supply of collagen, a by-product of the
production of leather, for which the two largest uses are the
cyclical automotive and footwear markets. We believe the group
should trade through the current turmoil, and with capex likely to
trail depreciation for several years, cash generation should be
resilient.
Beyond the current short-term situation, our view on the
potential for Devro remains unchanged. The group is a clear leader
in stable end markets, with a strong management team, delivering
cost reductions and strong cash generation. Successful execution on
cost savings alongside a return to volume growth would underpin a
change in perception of the equity story and support an uplift in
its rating.
Benchmark Holdings
% NAV: 4%
Sector: Healthcare
Benchmark has leading positions in key parts of the growing
global aquaculture market. The group is a leading provider of
genetics services to the salmon market, production of early stage
nutrition products primarily for the shrimp market and a developer
of health products for the salmon market.
Performance in period
Benchmark has had a mixed year. The ongoing headwind from the
deepest recession in the shrimp market for 30 years impacted
performance in the Nutrition business. Concurrently, the early
successful completion of customer funded trials of the group's new
sea lice treatment impacted revenue in the Health business.
Combined, these drove material downgrades through the period and
increasing leverage. A well supported GBP43m equity raise in
February 2020, reduced leverage and offered improved liquidity.
On the positive side, the difficulties detailed above have
driven a welcome acceleration of the various corporate actions we
have long seen as crucial to the Benchmark investment case.
Wholesale management changes have been made with a new CEO and a
new CFO appointed in the past six months, a bottom-up review of
group operations identified a number of 'non-core' activities,
which are in the process of being sold or shut down, and a detailed
review of the R&D pipeline is expected to reduce spend and
focus down onto the most commercially attractive near-term
opportunities. We view all of these changes as positive steps in
releasing value in what remains a highly strategic asset.
Outlook
Benchmark has flagged that both its Healthcare and Genetics
operations are well placed to trade through the current
COVID-driven uncertainty, but that the Nutrition division may
continue to be impacted by weakness in the shrimp market. The
recent equity raise, alongside a highly flexible financing
structure (via a Norwegian bond), offers considerable flexibility
on liquidity.
Near-term COVID impacts aside, and despite the challenging year,
the recent actions taken at Benchmark augur well for the future.
The group now appears to be on the right path towards focusing on
its core areas of market leadership, with new management driving
increased discipline on both capital and operating cost investment.
With the key new sea lice treatment expected to receive commercial
approval in the next 12 months, we see a potential step change in
the value of this key player in the growing global aquaculture
market.
Clinigen Group
% NAV: 4%
Sector: Healthcare
Clinigen provides a range of services to the pharmaceutical
market, focused on ensuring that hard to access medicines reach the
right patients at the right time. The group supports distribution
of unlicensed medicines into smaller or hard to access markets,
supports commercialisation of licensed products globally and
supports clinical trials.
Clinigen is a market leader in a range of niche pharmaceutical
services and products. The group has built a market leading
position in (i) Unlicensed Medicines - providing medical
professionals access to drugs currently undergoing trial or which
are unlicensed in a particular jurisdiction; (ii) Clinical Services
- Clinigen is a leader in sourcing comparator drugs for use in
clinical trials and other related service areas; and (iii)
Commercial Medicines - Clinigen has a portfolio of owned and
licenced medicines where it can accelerate sales through accessing
pockets of demand and jurisdictions typically too small for larger
pharma companies to target.
The markets in which Clinigen operates are large and typically
growing at mid to high single digits, driven by secular tail winds
from the increasing volume and diversity of new medicine launches,
and the trend for increased outsourcing across the industry.
Clinigen has built leading global platforms in its chosen markets
and has strong, long-term, blue-chip clients in markets where reach
and reputation are crucial and represent significant barriers to
entry. The end markets which Clinigen addresses are well insulated
from COVID-19 and the group has seen little impact on operations to
date.
Our investment case sees multiple levers for value growth. We
believe the group is well placed to grow organically at above
market rates as it gains share from competitors and benefits from
recently completed M&A. Further, we believe after the recent
period of building the group through acquisition, there exists
significant opportunity to improve margins through better
integrating the group - a journey which is just being started by
the current management team. Finally, although geared today, the
group should generate strong free cash flow going forward post
completion of certain earnout obligations. We believe that part of
the recent de-rating has been driven by the level of gearing on the
balance sheet. Given how cash generative the group is, we see
leverage reducing substantially over the next 18 months. Provided
achieved earnings are near current market forecasts, this
de-gearing should catalyse a material re-rating of the equity.
We believe that Clinigen is a higher quality, cash generative
business with a complex story, somewhat misunderstood by the
investors. This is demonstrated by a rating which has been more
volatile than the earnings profile would suggest. This presented an
opportunity for us to make our investment at a value below where we
see potential strategic (or private equity) interest.
The remaining nine investments represent between c.1% and 3% of
NAV each. These are spread across our core focus sectors and all
offer scope to scale, subject to further due diligence and pricing
remaining attractive.
Outlook
The new financial year has begun in an equity bear market,
driven by one of the sharpest equity market corrections on record.
The current circumstances are very unusual, with a near
simultaneous global recession triggered by simultaneous supply and
demand shocks. There are few precedents to draw upon.
Share prices are always a leading indicator of economic and
corporate earnings, and they are giving a very strong signal of the
broad impact that companies and the global economy will experience
in 2020. Concerns about Brexit pale into insignificance.
Despite the unprecedented fiscal and monetary stimulation by
many governments, few companies are likely to escape unscathed.
Companies with weak business models, weak competitive positions and
weak balance sheets are unlikely to survive. We see many more
similarities to the early 1990s recession than the Great Financial
Crisis of 2008-9.
We have no strong view about whether the markets have already
hit the bottom. It is also becoming clearer week-by-week that a
snap back in earnings in 2021 to levels previously achieved in 2019
is increasingly unlikely.
Earnings forecasts are mostly irrelevant, with many companies
withdrawing guidance. One Chairman told us it was "just impossible"
to give any sensible guidance. As a result, valuing companies has
become more challenging. We have always considered EV/Sales as
being a less volatile valuation metric than earnings or profit
multiples. In addition, particularly in asset rich companies, price
to book multiples tend to offer good indicators of compelling
long-term value opportunities.
Due to these factors, there appears to be good long-term upside
within the existing portfolio. We continue to engage with the
portfolio companies, especially where we had already highlighted
scope for improvement potential prior to COVID-19 impacting
trading. Whilst the near-term focus will be on crisis/cash
management, at some point it will be appropriate to engage on how
they capitalise on the opportunities that the crisis will present.
In one example, a portfolio company which is a market leader, is
the only one of its close peers still open for business. We would
not be surprised if a number of its smaller, less well capitalised
peers either do not re-open, or alternatively run out of cash when
the market recovers. These types of situations offer scope for
organic market share gains and/or bargain acquisition targets.
We intend to continue investing using our established criteria,
namely seeking out new investments in market leaders with strong
business models, with improvement potential, international earnings
and high barriers to entry. We will continue to avoid resource
companies and are reluctant to invest in companies which have
direct exposure to discretionary consumer expenditure. Equally, we
are not focused on deep value "option" stocks. Given our good
knowledge of our investment universe, we already have a strong view
of the new investments we are likely to make during the rest of
this year. The focus now is on completing our due diligence and
determining the optimal price and timing for investment.
Over the next 6-12 months, we expect portfolio turnover to be
higher than typical, as we will probably make more new investments
than usual. We may also realise some of our existing holdings
which, despite serving us well through the difficult recent months,
offer a less compelling risk/reward balance than alternative
investments that we can find in the market.
The net cash balance, 10% at the period end (or 16% including
the holding in Huntsworth, which became cash in April 2020) is
likely to fall progressively through 2020. We will not attempt to
market time but will invest gradually over the period as and when
suitable situations and liquidity arise.
We anticipate that there will be many companies seeking to raise
new equity to repair their balance sheets, or position themselves
to capitalise on the opportunities that the turmoil has caused.
Currently there appears to be widespread investor support for these
fundraisings, but this could wane if open-ended funds are subject
to outflow requests, and managers use their cash balances up. We
believe that there will be multiple attractive investment
opportunities to recapitalise quoted UK small companies in the
second half of 2020. We have identified a number of these companies
and believe, subject to an appropriate entry price, that they have
the potential to generate compelling medium to long-term
investments for the Company's shareholders.
We are fortunate to manage our investments via a closed-ended
fund structure. This allows us high visibility on the existing
assets under our control, to think and act for the long term and be
less concerned by limited day-to-day liquidity of the shares of
portfolio companies. Allied with our own combined investment
experience of more than three decades, we are also fortunate to be
able to draw on the insights and advice of the non-executives of
the Company and of our own Fund Management company, as well as our
three-strong panel of advisors. Whilst these factors do not
guarantee success, they provide us with additional tools in our
toolkit to navigate these uncharted waters.
Stuart Widdowson & Ed Wielechowski
Odyssean Capital LLP
8 June 2020
Portfolio of Investments
As at 31 March 2020
Valuation % of
Company Sector Country of Listing GBP'000 Net Assets
---------------------------- ------------------- -------------------- ---------- -----------
Top 10 Investments
NCC Group TMT United Kingdom 10,181 12.7
SDL TMT United Kingdom 9,339 11.7
Equiniti Business Services United Kingdom 8,797 11.0
Chemring Group Industrials United Kingdom 6,575 8.2
Huntsworth TMT United Kingdom 4,633 5.8
Volution Industrials United Kingdom 4,194 5.2
Flowtech Fluidpower Business Services United Kingdom 3,921 4.9
Devro Consumer United Kingdom 3,725 4.7
Benchmark Holdings Healthcare United Kingdom 3,381 4.2
Clinigen Group Healthcare United Kingdom 3,138 3.9
---------------------------- ------------------- -------------------- ---------- -----------
Other equity investments* 14,382 17.9
----------------------------------------------------------------------- ---------- -----------
Total equity investments 72,266 90.2
Cash and other net current
assets 7,829 9.8
----------------------------------------------------------------------- ---------- -----------
Net assets 80,095 100.0
----------------------------------------------------------------------- ---------- -----------
* Sum of equity investments in companies where the investment in
each company is less than 3% of its net assets.
The Company has not disclosed the names of any investment where
the holding is below 3% of its net assets on the grounds that the
Company is continuing to build positions in these portfolio
companies, disclosure of which is deemed to be commercially
sensitive information.
Distribution of Investments
as at 31 March 2020 (% of net assets)
Portfolio holdings
Other equity investments 17.9%
NCC Group 12.7%
SDL 11.7%
Equiniti 11.0%
Chemring Group 8.2%
Huntsworth 5.8%
Volution 5.2%
Flowtech Fluidpower 4.9%
Devro 4.7%
Benchmark Holdings 4.2%
Clinigen Group 3.9%
Cash and other net current
assets 9.8%
% holding by sector
TMT 35.1%
Business Services 21.1%
Industrials 16.7%
Healthcare 10.6%
Consumer 4.7%
Other equity investments 2.0%
Cash and other net current
assets 9.8%
Geographical revenue exposure
(% of invested capital)
UK 42.1%
US 24.7%
Europe Other 18.0%
RoW 15.2%
Market capitalisation
(% of invested capital)
Below GBP150m 10.9%
GBP150m-GBP750m 86.3%
Over GBP750m 2.8%
At as 31 March 2020, the net assets of the Company were
GBP80m.
Strategic Overview
Business Model
Status of the Company
The Company was incorporated on 21 December 2017 and the IPO
took place on 1 May 2018. It is registered in England and Wales as
a public limited company and is an investment company within the
terms of section 833 of the Companies Act 2006. The principal
activity of the Company is to carry on business as an investment
trust. The Company has been approved by HM Revenue & Customs as
an authorised investment trust under sections 1158 and 1159 of the
Corporation Tax Act 2010, subject to there being no subsequent
serious breaches of regulations. In the opinion of the Directors,
the Company is directing its affairs so as to enable it to continue
to qualify for such approval.
The Company's shares have a listing on the premium segment of
the Official List of the FCA and trade on the LSE's main market for
listed securities.
The Company is a member of the AIC, a trade body which promotes
investment companies and also develops best practice for its
members.
Purpose
The purpose of the Company is to achieve predominantly capital
growth in our shareholders' wealth over time. It aims to achieve
this by using its closed-ended structure to invest in a
concentrated number of less liquid, higher-quality smaller quoted
companies, which the Portfolio Manager believes are undervalued and
could be generating higher returns for their shareholders. The
long-term nature of the Company's capital enables the Portfolio
Manager to undertake constructive corporate engagement with the
underlying portfolio companies and their stakeholders, on financial
and operating performance, strategy and sustainability,
specifically ESG practices.
Sustainable improvement in a smaller quoted company's financial
and operational performance, and ESG practices, not only benefit
the shareholders of the Company, but also the shareholders and
stakeholders in the underlying portfolio companies.
Investment objective
The investment objective of the Company is to achieve attractive
total returns per share principally through capital growth over a
long-term period.
Investment policy
The Company's full investment policy is set out in the full
Annual Report and Financial Statements and contains information on
the policies which the Company follows, including in relation to
borrowings, derivatives and hedging. The Company invests primarily
in smaller company equities quoted on markets operated by the LSE,
where the Portfolio Manager believes the securities are trading
below intrinsic value and where this value can be increased through
strategic, operational, management and/or financial
initiatives.
Any material change to the Company's investment policy would
require the approval of shareholders by way of an ordinary
resolution at a general meeting and the approval of the FCA.
Non-material changes to the investment policy may be approved by
the Board.
Portfolio analysis
A detailed review of how the Company's assets have been invested
is contained in the Chairman's Statement and the Portfolio
Manager's Report above. A list of all the Company's investments is
contained in the Portfolio of Investments above.
Section 172 statement
Overview
The Directors' overarching duty is to act in good faith and in a
way that is the most likely to promote the success of the Company
as set out in Section 172 of the Companies Act 2006. In doing so,
directors must take into consideration the interests of the various
stakeholders of the Company, the impact the Company has on the
community and the environment, take a long-term view on
consequences of the decisions they make as well as aim to
maintaining a reputation for high standards of business conduct and
fair treatment between the members of the Company.
Fulfilling this duty naturally supports the Company in achieving
its investment objective and helps to ensure that all decisions are
made in a responsible and sustainable way. In accordance with the
requirements of the Companies (Miscellaneous Reporting) Regulations
2018, the Company explains how the Directors have discharged their
duty under Section 172 below.
To ensure that the Directors are aware of, and understand, their
duties they are provided with the pertinent information when they
first join the Board as well as receive regular and ongoing updates
and training on the relevant matters. Induction and access to
training is provided for new Directors. They also have continued
access to the advice and services of the Company Secretary, and
when deemed necessary, the Directors can seek independent
professional advice. The schedule of Matters Reserved for the
Board, as well as the Terms of Reference of its committees are
reviewed on an annual basis and further describe Directors'
responsibilities and obligations and include any statutory and
regulatory duties. The Audit Committee has the responsibility for
the ongoing review of the Company's risk management systems and
internal controls and, to the extent that they are applicable,
risks related to the matters set out in Section 172 are included in
the Company's risk register and are subject to periodic and regular
reviews and monitoring.
Stakeholders
A company's stakeholders are normally considered to comprise of
its shareholders, its employees, its customers, its suppliers as
well as the wider community in which the company operates and
impacts. The Company is different in that as an investment trust it
has no employees and, significantly, its customers are synonymous
with its shareholders. In terms of suppliers, the Company receives
professional services from a number of different providers,
principal among them being the Portfolio Manager. The Board
believes that the wider community in which the Company operates
encompasses its portfolio of investee companies and the communities
in which they operate.
During the period under review, the Board discussed which
parties should be considered as stakeholders of the Company.
Following a comprehensive review, it was concluded that, as the
Company is an externally managed investment company and does not
have any employees or customers, its key stakeholders comprise its
shareholders, its portfolio companies and its service providers,
primarily the Portfolio Manager. Details of how the Board considers
the needs and priorities of the Company's stakeholders and how
these are taken into account during all its discussions and as part
of its decision-making are detailed below. All discussions involve
careful considerations of the longer-term consequences of any
decisions and their implications for stakeholders.
Stakeholder Board Engagement
Shareholders The Board is committed to maintaining open
Continued shareholder channels of communication and to engage with
support and engagement shareholders in a manner which they find most
are critical to meaningful, in order to gain an understanding
existence of the views of shareholders. These include:
of the business
and the - Annual General Meeting - The Company welcomes
delivery of the and encourages attendance, voting and participation
longterm from shareholders at the AGM, during which
strategy of the the Directors and the Portfolio Manager are
Company. available to discuss issues affecting the
Company and answer any questions. The Portfolio
Manager provides a presentation at the AGM
on the Company's performance and its future
outlook. The Company values any feedback and
questions it may receive from shareholders
ahead of and during the AGM;
- Publications - The Annual and Interim Reports
of the Company are made available on its website
and the Annual Report is circulated to shareholders.
These reports provide shareholders with a
clear understanding of the Company's portfolio
and financial position. This information is
supplemented by a quarterly factsheet and
a quarterly presentation which are available
on the website. Feedback and/or questions
the Company receives from the shareholders
help the Company evolve its reporting, aiming
to render the reports and updates transparent
and understandable;
- Shareholder meetings - The Portfolio Manager
and the Company's Broker are in regular contact
with major shareholders. The Chairman and
the other Directors are available to meet
with shareholders to understand their views
on governance and the Company's performance
where they wish to do so. Shareholders are
able to meet with the Portfolio Manager throughout
the year. The results from all meetings between
the Portfolio Manager, the Broker and the
shareholders, and the views of the shareholders
are reported to the Board on a regular basis;
- Shareholder concerns - In the event shareholders
wish to raise issues or concerns with the
Directors, they are welcome to do so at any
time by writing to the Chairman. Other members
of the Board are also available to shareholders
if they have concerns that have not been addressed
through the normal channels. Shareholders
wishing to communicate directly with the Board
should contact the Company Secretary at the
registered office address; and
- Investor relations updates - At every Board
meeting, the Directors receive updates from
the Company's Broker on the share trading
activity, share price performance and any
shareholders' feedback, as well as an update
from the Portfolio Manager on any publications.
To gain a deeper understanding of the views
of its shareholders and potential investors,
the Portfolio Manager also meets regularly
with shareholders. Any pertinent feedback
is taken into account when Directors discuss
the share capital and any possible fundraisings.
The Chairman also wrote to the major shareholders
of the Company following the publication of
OIT's first annual financial results in May
2019. The willingness of the shareholders,
including the partners and staff of the Portfolio
Manager, to maintain their holdings over the
long-term period is another way for the Board
to gauge how the Company is meeting its objectives
and suggests a presence of a healthy corporate
culture.
-------------------------------------------------------------
The Portfolio The management of the Company's portfolio
Manager is delegated to the Portfolio Manager, which
The Portfolio manages the assets in accordance with the
Manager's Company's objectives and policies. At each
performance is Board meeting, representatives from the Portfolio
critical Manager are in attendance to present reports
for the Company to the Directors covering the Company's current
to and future activities, portfolio of assets
successfully deliver and its investment performance over the preceding
its period.
investment strategy
and Maintaining a close and constructive working
meet its objective relationship with the Portfolio Manager is
to crucial as the Board and Odyssean both aim
provide shareholders to continue to achieve consistent, long-term
with attractive returns in line with its investment objective.
total Important components in the collaboration
return over a with the Portfolio Manager, representative
long-term of the Company's culture, are:
period.
* Operating in a fully supportive, co-operative and
open environment and maintaining ongoing
communication with the Board between formal meetings;
* Encouraging open discussion with the Portfolio
Manager, allowing time and space for original and
innovative thinking;
* Recognising that the interests of shareholders and
the Portfolio Manager are for the most part well
aligned, adopting a tone of constructive challenge,
balanced with robust negotiation of the Portfolio
Manager's terms of engagement if those interests
should not be fully united;
* Drawing on Board members' individual experience and
knowledge to support the Portfolio Manager in its
monitoring of and engagement with portfolio
companies; and
* Willingness to make the Board members' experience
available to support the Portfolio Manager in the
sound long-term development of its business and
resources, recognising that the long-term health of
the Portfolio Manager is in the interests of
shareholders in the Company.
-------------------------------------------------------------
Portfolio companies The relationship with the Portfolio Manager
The Company is fundamental to ensuring the Company meets
invests into available its purpose. Day-to-day engagement with portfolio
opportunities, companies is undertaken by the Portfolio Manager.
allocating Details of how Odyssean carries out portfolio
capital across management, as well as information on its
different differentiated investment approach and the
portfolio companies structuring of investments can be found in
to the Portfolio Manager's report above. The
meet the Company's Board receives updates at each scheduled Board
investment objectives meeting from the Portfolio Manager on specific
within the pre-defined investments including regular valuation reports
portfolio limits and detailed portfolio and returns analyses.
and with Odyssean's engagement with portfolio companies
a focus on portfolio incorporates recurring due diligence reviews,
level active voting at their annual general meetings,
diversification. discussions with their stakeholders (including
but not limited to executives, non-executives,
other shareholders and corporate advisors)
and on-site visits.
-------------------------------------------------------------
Other service The Company's main functions are delegated
providers to a number of service providers, each engaged
In order to function under separate contracts. The Board maintains
as an investment regular contact with its key external providers
trust with and receives regular reporting from them,
a premium listing both through the Board and committee meetings,
on the LSE, the as well as outside of the regular meeting
Company relies cycle. Their advice and views are routinely
on a diverse range taken into account. The Audit Committee reviews
of reputable advisors and evaluates the financial reporting control
for environments in place at each service provider.
support in meeting Through its Management Engagement Committee,
all the Board formally assesses their performance,
relevant obligations. fees and continuing appointment annually to
ensure that the key service providers continue
to function at an acceptable level and are
appropriately remunerated to deliver the expected
level of service. Post year end, the Board
has approved the change of its service providers
for the provision of administration and company
secretarial services from Link to Frostrow
Capital LLP. This change is expected to take
effect from mid-July 2020. Frostrow Capital
LLP's marketing and distribution capabilities
will enhance the Portfolio Manager's existing
marketing initiatives.
-------------------------------------------------------------
The above mechanisms for engaging with stakeholders are kept
under review by the Directors and will be discussed on a regular
basis at Board meetings to ensure that they remain effective.
Culture
The Directors agree that establishing and maintaining a healthy
corporate culture among the Board and in its interaction with the
Portfolio Manager, shareholders and other stakeholders will support
the delivery of its purpose, values and strategy. The Board seeks
to promote a culture of openness, debate and integrity through
ongoing dialogue and engagement with its service providers,
principally, the Portfolio Manager.
The Board strives to ensure that its culture is in line with the
Company's purpose, values and strategy. As detailed in the
Corporate Governance Statement, the Company has a number of
policies and procedures in place to assist with maintaining a
culture of good governance including those relating to diversity,
Directors' conflicts of interest and Directors' dealings in the
Company's shares. The Board assesses and monitors compliance with
these policies as well as the general culture of the Board through
Board meetings and in particular, during the annual evaluation
process which is undertaken by each Director (for more information
see the performance evaluation section in the full Annual Report
and Financial Statements).
The Board is cognisant of the nature of companies that the
Company invests in and notes that their performance could fluctuate
while the Portfolio Manager actively engages with them. This
requires a culture of patience from the Board, supported by an
orderly, disciplined investment management process by the Portfolio
Manager. The Board pays particular attention to Odyssean's
corporate engagement initiatives and proxy voting policies.
Additional information on the Board's approach to ESG matters is
detailed below.
The Board seeks to appoint the best possible service providers
and evaluates their remit, performance and cost effectiveness on a
regular basis. The Board considers the culture of the Portfolio
Manager and other service providers, including their policies,
practices and behaviour, through regular reporting from these
stakeholders and, in particular, during the annual review of the
performance and continuing appointment of all service providers
through its Management Engagement Committee.
Key performance indicators
At each Board meeting, the Directors consider several
performance measures to assess the Company's success in achieving
its objective. The key performance indicators used to measure the
progress and performance of the Company over time are established
industry measures. These are as follows:
Net asset value
The NAV at 31 March 2020 was 90.8p per ordinary share, compared
to 96.3p per ordinary share at the end of the previous period, a
decrease of 5.7%. The NAV total return* since the launch of the
Company on 1 May 2018 to 31 March 2020 was (7.7)%. The total return
from the NSCI ex IC plus AIM Total Return Index* was (23.2)% for
the same period.
A full description of the Company's performance for the year
ended 31 March 2020 can be found in the Portfolio Manager's Report
above.
Share price
The Company's share price at the previous period end was 99.3p
and decreased to 90.0p as at 31 March 2020, resulting in a return
of (9.4)% during the year.
Share price premium/(discount) to NAV*
The share price discount to NAV changed from 3.1% at the
previous period end to (0.9)% as at 31 March 2020. During the year
ended 31 March 2020, the shares traded at an average discount to
NAV of 2.4%.
Revenue return per ordinary share
In the year to 31 March 2020, the revenue return per ordinary
share increased from (0.6)p to 0.6p.
Ongoing charges*
The Company's ongoing charges ratio for the year ended 31 March
2020 was 1.7% (period ended 31 March 2019: 1.6%).
* Alternative Performance Measures (see Glossary below).
Main trends and future development
A review of the main features of the year ended 31 March 2020,
the outlook for the current year and the factors likely to affect
the future development, performance and position of the business,
can be found in the Chairman's Statement and the Portfolio
Manager's Report above. The Board's main focus is on the investment
return and strategy, with attention paid to the integrity and
success of the investment approach and on the factors which may
have an impact on this.
Management arrangements
The Company is an internally managed investment company for the
purposes of the Alternative Investment Fund Managers Directive and
is its own alternative investment fund manager. The Board is
therefore responsible for the portfolio management and risk
management functions of the Company.
Pursuant to the terms of the Portfolio Management Agreement, the
Board has delegated responsibility for discretionary portfolio
management functions to Odyssean Capital LLP as the Company's
Portfolio Manager, subject always to the overall supervision and
control of the Board.
The Portfolio Manager is entitled to receive an annual
management fee equal to the lower of: (i) 1% of the NAV (calculated
before deduction of any accrued but unpaid management fee and any
performance fee) per annum; or (ii) 1% per annum of the Company's
market capitalisation. The annual management fee is calculated and
accrues daily and is payable quarterly in arrears.
In addition, the Portfolio Manager is entitled to a performance
fee in certain circumstances. Further details can be found in note
3 to the financial statements.
The Portfolio Manager is also entitled to reimbursement for all
costs and expenses properly incurred by it in the performance of
its duties under the Portfolio Management Agreement.
The initial term of the Portfolio Management Agreement is three
years commencing on the date of the Company's launch (the "Initial
Term"). The Company may terminate the Portfolio Management
Agreement by giving the Portfolio Manager not less than six months'
prior written notice, such notice not to be served prior to the end
of the Initial Term. The Portfolio Manager may terminate the
Portfolio Management Agreement by giving the Company not less than
six months' prior written notice, such notice not to be served
prior to the end of the Initial Term.
Continuing appointment of the Portfolio Manager
The Board keeps the ongoing performance of the Portfolio Manager
under continual review and the Management Engagement Committee
conducts an annual appraisal of the Portfolio Manager's performance
and makes a recommendation to the Board about the continuing
appointment of the Portfolio Manager.
The Management Engagement Committee has reviewed Odyssean's
performance, with respect to their provision of portfolio
management and other services. Due consideration was given to the
quality and continuity of its personnel, succession planning and
investment processes. Alongside the performance review, the
Committee completed an appraisal of the terms of the Portfolio
Management Agreement to ensure that the terms remained competitive
and in the interest of the Company. The Portfolio Manager has
executed the investment strategy according to the Board's
expectations and it is the opinion of the Directors that the
continuing appointment of the Portfolio Manager on the terms agreed
is in the interests of shareholders as a whole.
Employees, human rights, social and community issues
The Board recognises the requirement under the Companies Act
2006 to detail information about human rights, employees and
community issues, including information about any policies it has
in relation to these matters and the effectiveness of these
policies. These requirements do not apply to the Company as it has
no employees, all the Directors are non-executive and it has
outsourced all its functions to third party service providers. The
Company has therefore not reported further in respect of these
provisions, however, it does expect its service providers and
portfolio companies to respect these requirements.
Board diversity
As at 31 March 2020, the Board of Directors of the Company
comprised two male and two female Directors. The Board firmly
believes in the benefits of cognitive diversity and remains
committed to ensuring that the Company's Directors bring a wide
range of skills, knowledge, experience, backgrounds and
perspectives. Further details of the Company's diversity policy are
set out in the full Annual Report and Financial Statements.
Environmental, social and governance Issues
The Company has no employees, property or activities other than
investments, so its direct environmental impact is minimal. In
carrying out its activities and in its relationships with service
providers, the Company aims to conduct itself responsibly,
ethically and fairly.
The Board is comprised entirely of non-executive Directors and
the day-to-day management of the Company's business is delegated to
the Portfolio Manager. The Portfolio Manager aims to be a
responsible investor and believes it is important to invest in
companies that act responsibly in respect of environmental, ethical
and social issues.
The Portfolio Manager is specifically looking to invest in
companies which have average or above average ESG characteristics
or practices, but where improvement potential exists. Being mindful
of the smaller company nature of many of the portfolio companies,
the Portfolio Manager has a pragmatic engagement approach, focused
on dialogue with portfolio companies around their performance,
disclosure and general practices compared with best-in-class peers,
and seeking positive changes in specific areas.
The Directors believe that proxy voting is an important part of
the corporate governance process. It is the policy of the Company
to vote at all shareholder meetings of investee companies, and the
Board has delegated voting activities to the Portfolio Manager. The
Portfolio Manager follows relevant regulatory requirements with an
aim to make voting decisions which will best support growth in
shareholder value and will commonly take into account best
practices regarding corporate governance, board composition,
remuneration and ESG issues. The Portfolio Manager also provides
the Directors with a six-monthly update regarding the voting
decisions made in respect of the investee companies.
Modern slavery
While the Company is not within the scope of the Modern Slavery
Act 2015 and it is not, therefore, obliged to make a slavery and
human traffcking statement, the Company considers its supply chains
to be of low risk as its principal service providers are the
professional advisers set out in the Corporate Information section
in the full Annual Report and Financial Statements.
Risk Management
Role of the Board
The Directors have overall responsibility for risk management
and internal control within the Company. They recognise that risk
is inherent in the Company's operation and that effective risk
management is an important element in the success of the
organisation. The Directors have delegated responsibility for the
assurance of the risk management process and the review of
mitigating controls to the Audit Committee. The Directors, when
setting the risk management strategy, also determine the nature and
extent of the significant risks and its risk appetite in
implementing this strategy.
The principal risks and uncertainties which the Company faces
are set out below.
Internal control review
The Board is responsible for the internal controls relating to
the Company, including the reliability of the financial reporting
process, and for reviewing their effectiveness.
An ongoing process, in accordance with the FRC Guidance on Risk
Management, Internal Control and Related Financial and Business
Reporting, has been established for identifying, evaluating and
managing the principal risks faced by the Company. This process,
which is regularly reviewed, together with key procedures
established with a view to providing effective financial control,
has been in place throughout the period ended 31 March 2020 and up
to the date of this Report. The internal control systems are
designed to ensure that proper accounting records are maintained,
that the financial information on which business decisions are made
and which are issued for publication is reliable and that the
assets of the Company are safeguarded.
The risk management process and systems of internal control are
designed to manage rather than eliminate the risk of failure to
achieve the Company's investment objective. It should be recognised
that such systems can only provide reasonable, not absolute,
assurance against material misstatement or loss.
The Directors have carried out a review of the effectiveness of
the Company's risk management and internal control systems as they
have operated over the period and up to the date of approval of
this Report. There were no matters arising from this review that
required further investigation and no significant failings or
weaknesses were identified.
Internal control assessment process
Robust risk assessments and reviews of internal controls are
undertaken regularly in the context of the Company's overall
investment objective. The Board, through the Audit Committee, has
categorised risk management controls under the following key
headings: corporate strategy; published information, compliance
with laws and regulations; relationships with service providers;
and investment and business activities. In arriving at its
judgement of what risks the Company faces, the Board has considered
the Company's operations in the light of the following factors:
- the nature and extent of risks which it regards as acceptable
for the Company to bear within its overall business objective;
- the threat of such risks becoming reality;
- the Company's ability to reduce the incidence and impact of
risk on its performance;
- the cost to the Company and benefits related to the review of
risk and associated controls of the Company; and
- the extent to which the third parties operate the relevant
controls.
A risk matrix has been produced so that the risks identified and
the controls in place to mitigate those risks can be monitored. The
risks are assessed on the basis of the likelihood of them
happening, the impact on the business if they were to occur and the
effectiveness of the controls in place to mitigate them. This risk
register is reviewed by the Audit Committee regularly.
Most of the day-to-day management functions of the Company are
sub-contracted, and the Directors therefore obtain regular
assurances and information from key third party suppliers regarding
the internal systems and controls operating in their organisations.
In addition, each of the third parties is requested to provide a
copy of its report on internal controls each year, which is
reviewed by the Audit Committee.
Principal risks and uncertainties
The Company is exposed to a variety of risks and uncertainties
that could cause its asset price or the income from the investment
portfolio to reduce, possibly by a sizeable percentage in the most
adverse circumstances. The Board, through delegation to the Audit
Committee, has undertaken a robust assessment and review of the
principal risks facing the Company, together with a review of any
new risks which may have arisen during the year, including those
that would threaten its business model, future performance,
solvency or liquidity. These risks are formalised within the
Company's risk matrix. The Company's risk matrix is formally
reviewed twice a year at each Audit Committee meeting. The
Directors formally discuss emerging risks at the other Board
meetings held during the year.
COVID-19 has had a material negative impact on the valuation of
the Company's assets and on the performance of a number of its
underlying holdings. The Portfolio Manager has taken steps to
assess the anticipated effects on each holding, particularly in
terms of liquidity and balance sheets.
The principal financial risks and the Company's policies for
managing these risks and the policy and practice with regard to
financial instruments are summarised in note 12 to the financial
statements.
The Board has also identified the following additional risks and
uncertainties:
Risk How the risk is managed
------------------------------------------- ---------------------------------------
Investment performance is not
comparable to the expectations
of investors
Consistently poor performance The Board reviews and discusses
could lead to a fall in the the Company's performance against
share price and a widening of its investment objective and
the discount. The success of policy, as well as reviewing
the Company depends on the Portfolio performance in comparison to
Manager's ability to identify, industry peers and the broader
acquire and realise investments comparative market. The Board
in accordance with the Company's also keeps the performance of
investment policy. This, in the Portfolio Manager under
turn, depends on the ability continual review, along with
of the Portfolio Manager to a review of significant stock
apply its investment processes decisions and the overall rationale
and identify suitable investments. for holding the current portfolio.
In addition, the Management
Engagement Committee conducts
an annual appraisal of the Portfolio
Manager.
------------------------------------------- ---------------------------------------
Share price performance
The market price of the Company's The Board monitors the relationship
shares, like shares in all investment between the share price and
companies, may fluctuate independently the NAV, including regular review
of the NAV and thus may not of the level of discount relative
reflect the underlying NAV of to that of companies in the
the shares. The shares could sector. The Company has taken
trade at a discount or premium powers to re-purchase shares
to NAV at different times, depending and will consider doing so to
on factors such as market conditions, reduce the volatility of any
investors' perceptions of the share price discount. The Company
merits of the Company's objective has also taken powers to issue
and investment policy, supply shares (only at a premium to
and demand for the shares and NAV) to provide liquidity to
the extent investors value the the market to meet investor
activities of the Company and/or demand, whether by way of the
the Portfolio Manager. issue of further shares.
In addition, in the seventh
year following the IPO (and
every seventh year thereafter),
the Board will provide shareholders
with an opportunity to realise
their shares at the applicable
NAV.
------------------------------------------- ---------------------------------------
Portfolio Manager - loss of
personnel or reputation
The identification and selection The Board maintains a good level
of investment opportunities of communication and has a good
and the management of the day-to-day relationship with the Portfolio
activities of the Company depends Manager, and regularly reviews
on the diligence, skill, judgement the Portfolio Manager's performance
and business contacts of the at Board meetings. The Portfolio
Portfolio Manager's investment Manager's Compliance Officer
professionals and the information also reports to the Board regularly
and deal flow they generate and the Portfolio Manager would
during the normal course of report to the Board immediately
their activities. The Company's in the event of any change in
future success depends on the key personnel.
continuing ability of these
individuals to provide services Stuart Widdowson was on compassionate
and the Portfolio Manager's leave for part of 2019 and the
ability to strategically recruit, Board is pleased that he resumed
retain and motivate new talented his role as Key Man of the Company
personnel as required. The departure on 31 December 2019. The measures
of some or all of the Portfolio put in place by the Portfolio
Manager's investment professionals Manager to cover Mr Widdowson's
could prevent the Company from period of absence ensured that
achieving its investment objective the
and give rise to a significant portfolio continued to be managed
public perception risk regarding in accordance with the principles
the potential performance of and investment strategy set
the Company. out at the time of the Company's
launch.
------------------------------------------- ---------------------------------------
Material changes within the
Portfolio Manager's organisation
Material changes could occur The Portfolio Manager has advance
within the Portfolio Manager's notice of any material changes
organisation or its affiliates within its organisation and
which are to the detriment of would report to the Board immediately
the Company's standing in respect in the event of any such changes,
of its competitors and its profitability. including within its organisation
and affiliates or to its key
personnel.
------------------------------------------- ---------------------------------------
Valuation of unquoted investments
The Company may invest in unquoted All financial information is
companies from time to time. reviewed by the Board at regular
Such investments, by their nature, meetings. The Board and/or Chairman
involve a higher degree of valuation of the Audit Committee will
and performance uncertainties approve the valuation of unquoted
and liquidity risks than investments investments prior to their reflection
in listed and quoted securities in the Company's NAV. No unquoted
and they may be more difficult investments were held by the
to realise. Company during the year.
------------------------------------------- ---------------------------------------
Reliance on the performance
of third-party service providers
The Company has no employees The Board has appointed third
and the Directors have been party service providers with
appointed on a non-executive relevant experience. Each third
basis. The Company is reliant party service provider is monitored
upon the performance of third-party by the Board and their roles
service providers for its executive are evaluated at least annually
function. Failure by any service by the Management Engagement
provider to carry out its obligations Committee.
to the Company in accordance
with the terms of its appointment The Board has considered the
could have a material adverse operational risks associated
effect on the operation of the with COVID-19 relating to the
Company. functioning of all of the service
providers to the Company. Each
service provider has continued
to operate with its employees
working remotely and service
has not been disrupted. The
Board continues to monitor the
performance of all service providers
given the current requirements
for employees to work remotely
where they are able to do so.
Going concern
The Directors assessed the going concern of the Company in light
of its current trading performance. They looked at the forecasts
for the coming year and applied stress tests for adverse scenarios.
As a result, it was determined that the Company has sufficient
liquidity to cover all anticipated payments during that period. The
Directors also considered the regulatory capital of the Company and
determined that, based on the latest approved forecasts, the
Company will have sufficient regulatory capital for the same
period. The Directors have considered the impact of COVID-19 on the
Company's financial position and have considered a detailed
assessment of the Company's ability to meet its liabilities as they
fall due. This included stress and liquidity tests which modelled
the effects of further substantial market falls, and significantly
reduced market liquidity, to that experienced to date in connection
with the coronavirus pandemic. At the time of approving the
financial statements, the Directors have a reasonable expectation
that the Company has adequate resources to continue in operational
existence for the foreseeable future.
Viability statement
The Board has assessed the prospects of the Company over a
three-year period. This assessment period has been chosen as the
Board believes it represents an appropriate period given the
long-term investment horizons of the Company.
In considering the viability of the Company, the Directors have
conducted a robust assessment of each of its principal risks and
uncertainties (as set out above), specifically Key Man risk, and
the impact on the Company's portfolio of a significant fall in the
UK markets. The Directors do not expect there to be any significant
change in the current principal risks and adequacy of the
mitigating factors in place over the period of this assessment and
therefore, believe the going concern and viability period
assessment remains appropriate.
The effect of Brexit on the Company and the portfolio has been
considered. Whilst it is challenging to quantify any impact that
should arise from a change in the UK's relationship with the EU, it
is not believed that there will be a fundamental bearing on the
business. Any change arising from Brexit will likely bring
investment opportunities as well as headwinds and the Company's
investment strategy will remain appropriate in such an
environment.
The Board has also considered the Company's financial position
and its ability to liquidate its portfolio to meet expenses or
other liabilities as they fall due. In considering this, the Board
notes that:
- the Company primarily invests in companies listed and traded
on stock exchanges. These are actively traded and, whilst perhaps
less liquid than larger quoted companies, the portfolio is well
diversified;
- the Company's portfolio currently includes a large position in
cash. Cash balances can be varied due to changes in market
conditions, but positive cash levels are expected to be maintained
over the period; and
- the expenses of the Company are predictable and modest in
comparison to the assets in the portfolio. There are no commitments
that would change that position.
Based on this assessment, the Directors are confident that the
Company's investment approach, portfolio management and balance
sheet approach will ensure that the Company will be able to
continue in operation and meet its liabilities as they fall due
over the next three years.
Approval
This Strategic Report has been approved by the Board of
Directors and signed on its behalf by:
Jane Tufnell
Chairman
8 June 2020
Extracts from the Directors' Report
Directors
The Directors in office during the period and at the date of
this report are:
Jane Tufnell (Chairman)
Arabella Cecil (Senior Independent Director)
Peter Hewitt (Chairman of the Management Engagement
Committee)
Richard King (Chairman of the Audit Committee)
Share capital
Share issues
On 20 June 2018, the Company was granted a block listing of 5.0
million ordinary shares to be listed to the premium segment of the
Official List of the FCA and admitted to trading on the premium
segment of the LSE's main market. During the year ended 31 March
2020, no shares were issued under the block listing (period ended
31 March 2019: 800,000 shares were issued). As at the date of this
report, a balance of 4.2 million shares remain under this block
listing.
No other share issues were made during the year or since the
year end. Proposals for the renewal of the Directors' authority to
issue shares will be set out in the Notice of AGM.
Purchase of own shares
At the AGM held on 27 June 2019, the Directors were granted the
authority to buy back up to 13,229,755 ordinary shares, being
14.99% of the ordinary shares in issue at the time of the passing
of the resolution. No shares were bought back under this authority
during the year.
Subsequent to the year end of 31 March 2020 and up to 8 June
2020, the date of signing this report, the Company purchased in the
stock market 275,000 shares (with a nominal value of GBP2,750.00)
for treasury, at a total cost of GBP230,000, representing 0.3% of
the issued share capital as at 31 March 2020. The share purchases
were made with a view to reducing discount volatility and
maintaining the middle market price at which the shares traded
close to the NAV.
Current share capital
As at 31 March 2020, there were 88,257,211 ordinary shares in
issue, none of which were held in treasury. At general meetings of
the Company, shareholders were entitled to one vote on a show of
hands and, on a poll, to one vote for every share held. The total
voting rights of the Company as at 31 March 2020 were
88,257,211.
As at 8 June 2020, 275,000 shares were held in treasury.
Accordingly, the total voting rights of the Company as at the date
of this report were 87,982,211.
There are no restrictions concerning the transfer of securities
in the Company or on voting rights; no special rights with regard
to control attached to securities; no agreements between holders of
securities regarding their transfer known to the Company; and no
agreements which the Company is party to that might affect its
control following a successful takeover bid.
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report
and Financial Statements in accordance with applicable law and
regulation.
Company law requires the Directors to prepare financial
statements for each financial period. Accordingly, the Directors
have prepared the Financial Statements in accordance with IFRS as
adopted by the EU. Under company law, the Directors must not
approve the Financial Statements unless they are satisfied that
they give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for that
period.
In preparing the Financial Statements, the Directors are
required to:
- select suitable accounting policies in accordance with IAS 8:
"Accounting Policies, Changes in Accounting Estimates and Errors"
and then apply them consistently;
- present information, including accounting policies, in a
manner that provides relevant, reliable, comparable and
understandable information;
- provide additional disclosures when compliance with specific
requirements in IFRS is insufficient to enable users to understand
the impact of particular transactions, other events and conditions
on the Company's financial position and financial performance;
- state whether applicable IFRS have been followed, subject to
any material departures disclosed and explained in the Financial
Statements;
- make judgements and accounting estimates that are reasonable and prudent; and
- prepare the Financial Statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the Financial Statements comply with Companies Act 2006 and Article
4 of the IAS Regulation. They are also responsible for safeguarding
the assets of the Company and hence for taking reasonable steps for
the prevention and detection of fraud and other irregularities.
Under applicable law and regulations, the Directors are also
responsible for preparing a Strategic Report, Directors' Report,
Directors' Remuneration Report and Corporate Governance Statement
that comply with that law and those regulations, and for ensuring
that the Annual Report includes information required by the Listing
Rules of the FCA.
The Financial Statements are published on the Company's website,
www.oitplc.com, which is maintained on behalf of the Company by the
Portfolio Manager. The work carried out by the Auditor does not
involve consideration of the maintenance and integrity of this
website and accordingly, the Auditor accepts no responsibility for
any changes that have occurred to the Financial Statements since
they were initially presented on the website.
Under the Portfolio Management Agreement, the Portfolio Manager
is responsible for the maintenance and integrity of the corporate
and financial information included on the Company's website.
Visitors to the website need to be aware that legislation in the
United Kingdom covering the preparation and dissemination of the
financial statements may differ from legislation in their
jurisdiction.
We confirm that to the best of our knowledge:
- the Financial Statements, which have been prepared in
accordance with IFRS as adopted by the EU, give a true and fair
view of the assets, liabilities, financial position and loss of the
Company; and
- the Annual Report includes a fair review of the development
and performance of the business and the position of the Company,
together with a description of the principal risks and
uncertainties that it faces.
The Directors consider that the Annual Report and Financial
Statements, taken as a whole, is fair, balanced and understandable
and provides the information necessary for shareholders to assess
the Company's position and performance, business model and
strategy.
On behalf of the Board
Jane Tufnell
Chairman
8 June 2020
NON-STATUTORY ACCOUNTS
The financial information set out below does not constitute the
Company's statutory accounts for the year ended 31 March 2020 but
is derived from those accounts. Statutory accounts for the year
ended 31 March 2020 will be delivered to the Registrar of Companies
in due course. The Auditor has reported on those accounts; their
report was (i) unqualified, (ii) did not include a reference to any
matters to which the Auditor drew attention by way of emphasis
without qualifying their report and (iii) did not contain a
statement under Section 498 (2) or (3) of the Companies Act 2006.
The text of the Auditor's report can be found in the Company's full
Annual Report and Financial Statements on the Company's website at
www.oitplc.com.
Statement of Comprehensive Income
for the year ended 31 March 2020
Year ended 31 March 2020 Period ended 31 March 2019
Revenue Capital Total Revenue Capital Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- ------ --------- -------- -------- --------- --------- ---------
Income 2 1,949 133 2,082 715 - 715
Net (losses) on investments
at fair value 7 - (5,588) (5,588) - (1,266) (1,266)
Currency exchange losses - - - - (5) (5)
------ --------- -------- -------- --------- --------- ---------
Total income 1,949 (5,455) (3,506) 715 (1,271) (556)
Expenses
Portfolio management fee 3 (904) - (904) (784) - (784)
Other expenses 4 (495) - (495) (455) - (455)
--------- -------- -------- --------- --------- ---------
Total expenses (1,399) - (1,399) (1,239) - (1,239)
--------- -------- -------- --------- --------- ---------
Return before taxation 550 (5,455) (4,905) (524) (1,271) (1,795)
Taxation 5 (7) - (7) (5) - (5)
--------- -------- -------- --------- --------- ---------
Return for the period 543 (5,455) (4,912) (529) (1,271) (1,800)
--------- -------- -------- --------- --------- ---------
Basic and diluted earnings
per ordinary share (pence) 6 0.6 (6.2) (5.6) (0.6) (1.4) (2.0)
The total column of this statement is the Income Statement of
the Company prepared in accordance with IFRS, as adopted by the EU.
The supplementary revenue and capital columns are presented in
accordance with the Statement of Recommended Practice issued by the
AIC ("AIC SORP").
All revenue and capital items in the above statement derive from
continuing operations. No operations were acquired or discontinued
during the period.
There is no other comprehensive income, and therefore, the
profit for the period after tax is also the total comprehensive
income.
The accompanying notes below are an integral part of these
financial statements.
Statement of Changes in Equity
for the year ended 31 March 2020
Share Special
Share premium distributable Capital Revenue
capital account reserve* reserve reserve* Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- ------- -------- -------- -------------- -------- --------- --------
Year ended 31 March 2020
Opening balance as at 1 April
2019 883 449 85,475 (1,271) (529) 85,007
Total comprehensive income for
the year - - - (5,455) 543 (4,912)
-------- -------- -------------- -------- --------- --------
As at 31 March 2020 883 449 85,475 (6,726) 14 80,095
-------- -------- -------------- -------- --------- --------
Share Special
Share premium distributable Capital Revenue
capital account reserve* reserve reserve* Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- ------ -------- --------- -------------- -------- --------- --------
Period ended 31 March 2019
Opening balance as at 21 December - - - - - -
2017
Gross proceeds of share issue 10 883 87,403 - - - 88,286
Share issue costs 10 - (1,459) - - - (1,459)
Transfer to special distributable
reserve 10 - (85,495) 85,495 - - -
Share premium cancellation costs 10 - - (20) - - (20)
Total comprehensive income for
the period - - - (1,271) (529) (1,800)
-------- --------- -------------- -------- --------- --------
As at 31 March 2019 883 449 85,475 (1,271) (529) 85,007
-------- --------- -------------- -------- --------- --------
* The special distributable and revenue reserves can be
distributed in the form of dividends.
The distributable reserves are GBP78,763,000 (2019:
GBP83,675,000)
The accompanying notes below are an integral part of these
financial statements.
Balance Sheet
as at 31 March 2020
31 March 31 March
2020 2019
Notes GBP'000 GBP'000
--------------------------------------- ------ --------- ---------
Non current assets
Investments at fair value through
profit or loss 7 72,266 66,807
--------- ---------
Current assets
Trade and other receivables 8 187 298
Cash and cash equivalents 9,800 18,219
--------- ---------
9,987 18,517
Total assets 82,253 85,324
--------- ---------
Current liabilities
Trade and other payables 9 (2,158) (317)
--------- ---------
Total Liabilities (2,158) (317)
Total assets less current liabilities 80,095 85,007
--------- ---------
Net assets 80,095 85,007
--------- ---------
Represented by:
Share capital 10 883 883
Share premium account 449 449
Special distributable reserve 85,475 85,475
Capital reserve (6,726) (1,271)
Revenue reserve 14 (529)
--------- ---------
Total equity attributable to equity
holders of the Company 80,095 85,007
--------- ---------
Basic and diluted NAV per ordinary
share (pence) 11 90.8 96.3
--------- ---------
These statements were approved and authorised for issue by the
Board on 8 June 2020 and signed on its behalf by:
Jane Tufnell
Chairman
Company Registered Number: 11121934
The accompanying notes below are an integral part of these
financial statements.
Cash Flow Statement
for the year ended 31 March 2020
Year ended Period ended
31 March 31 March 2019
2020
Notes GBP'000 GBP'000
--------------------------------------- ------- ----------- --------------
Reconciliation of total return
before taxation to net cash outflows
from operating activities
Profit before tax (4,905) (1,795)
Losses on investments held at fair
value through profit and loss 5,588 1,270
Decrease/(increase) in receivables 105 (288)
(Decrease)/increase in creditors 32 319
Taxation paid (10) (5)
----------- --------------
Net cash inflow from operating
activities 810 (499)
Investing activities
Purchases (26,405) (69,217)
Sales 17,167 1,138
----------- --------------
Net cash outflow from investing
activities (9,238) (68,079)
----------- --------------
Financing activities
Gross proceeds of shares issued - 88,285
Share issue costs 10 (1,469)
Share premium cancellation costs - (20)
----------- --------------
Net cash inflow from investing
activities 10 86,796
----------- --------------
(Decrease)/Increase in cash and
cash equivalents (8,418) 18,218
Reconciliation of net cash flow
movements in funds
Cash and cash equivalents at the
beginning of the year 18,219 -
Exchange rate movements (1) 1
Increase in cash and cash equivalents (8,418) 18,218
----------- --------------
Increase in net cash (8,419) 18,219
----------- --------------
Cash and cash equivalents at end
of year 9,800 18,219
----------- --------------
The accompanying notes below are an integral part of these
financial statements.
Notes to the Financial Statements
for the year ended 31 March 2020
1. Accounting Policies
Odyssean Investment Trust PLC is a listed public company
incorporated and registered in England and Wales. The registered
office of the Company is Beaufort House, 51 New North Road, Exeter
EX4 4EP. The principal activity of the Company is that of an
investment trust company within the meaning of sections 1158/1159
of the Corporation Tax Act 2010 and its investment approach is
detailed in the Strategic Report.
a) Basis of preparation
The financial statements of the Company have been prepared in
accordance with IFRS as adopted by the EU which comprise standards
and interpretations approved by the International Accounting
Standards Board ('IASB'), and as applied in accordance with the
provisions of the Companies Act 2006. The annual financial
statements have also been prepared in accordance with the AIC SORP
for the financial statements of investment trust companies and
venture capital trusts, except to any extent where it is not
consistent with the requirements of IFRS.
The comparatives for the period to 31 March 2019 are for the
15-month period from incorporation on 21 December 2017 to 31 March
2019.
In order to better 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 prepared
alongside the Income Statement.
The functional currency of the Company is Sterling because this
is the currency of the primary economic environment in which the
Company operates. The financial statements are also presented in
Sterling rounded to the nearest thousand, except where otherwise
indicated.
b) Going concern
The financial statements have been prepared on a going concern
basis that approval as an investment trust company will continue to
be met.
The Directors have made an assessment of the Company's ability
to continue as a going concern and are satisfied that the Company
has the resources to continue in business for the foreseeable
future, being a period of at least 12 months from the date these
financial statements were approved. In making the assessment, the
Directors have considered the likely impacts of the current
COVID-19 pandemic on the Company, operations and the investment
portfolio. The Directors noted the cash balance exceeds any
short-term liabilities, the Company has no debt and the Company
holds a portfolio of investments listed on the LSE. The Company is
a closed end fund, where assets are not required to be liquidated
to meet redemptions. Whilst the economic future is uncertain, and
the Directors believe it is possible the Company could experience
further reductions in income and/or market value that this should
not be to a level which would threaten the Company's ability to
continue as a going concern. The Directors, the Portfolio Manager
and other service providers have put in place contingency plans to
minimise disruption. Furthermore, the Directors are not aware of
any material uncertainties that may cast doubt upon the Company's
ability to continue as a going concern, having taken into account
the liquidity of the Company's investment portfolio and the
Company's financial position in respect of its cash flows, debt and
investment commitments. Therefore, the financial statements have
been prepared on a going concern basis.
c) Segmental reporting
The Directors are of the opinion that the Company is engaged in
a single segment of the business, being investment business. The
Company invests in small companies principally based in countries
bordering the North Atlantic Ocean.
d) Accounting developments
In the current year, the Company has applied a number of
amendments to IFRS, issued by the IASB. These include annual
improvements to IFRS, changes in standards, legislative and
regulatory amendments, changes in disclosure and presentation
requirements. The Company has also applied, with associated
amendments, for the first time the following standards:
IFRS 16 Leases sets out the principles for the recognition,
measurement, presentation and disclosure of leases by lessors and
lessees.
The adoption of the changes to accounting standards has had no
material impact on the current or prior years' financial
statements.
e) Critical accounting judgements and key sources of estimation
uncertainty
The preparation of financial statements in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of policies and the reported amounts in
the Balance Sheet, the Income Statement and the disclosure of
contingent assets and liabilities at the date of the financial
statements. The estimates and associated assumptions are based on
historical experience and various other factors that are believed
to be reasonable under the circumstances, the results of which form
the basis of making judgements about carrying values of assets and
liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates.
The areas requiring the most significant judgement and
estimation in the preparation of the financial statements are:
recognising and classifying unusual or special dividends received
as either revenue or capital in nature; when determining any
deferred performance fee, this may be affected by future changes in
the Company's portfolio and other assets and liabilities; and
setting the levels of dividends paid and proposed in satisfaction
of both the Company's long-term objective and its obligations to
adhere to investment trust status rules under Section 1158 of the
Corporation Tax Act 2010.
The estimates and underlying assumptions are reviewed on an
ongoing basis. Any revisions to accounting estimates are recognised
in the period in which the estimate is revised if the revision
affects only that period, or in the period of the revision and
future period if the revision affects both current and future
periods. There are no significant judgements or estimates in these
financial statements.
f) Investments
The Company's business is investing in financial assets with a
view to profiting from their total return in the form of income and
capital growth. This portfolio of financial assets is managed and
its performance evaluated on a fair value basis in accordance with
the documented investment strategy and information is provided
internally on that basis to the Company's Board of Directors and
other key management personnel.
The investments held by the Company are designated by the
Company as 'at fair value through profit or loss'. All gains and
losses are allocated to the capital return within the Statement of
Comprehensive Income as 'Gains or losses on investments held at
fair value through profit or loss'. Also included within this
heading are transaction costs in relation to the purchase or sale
of investments. When a sale or purchase is made under a contract,
the terms of which require delivery within the timeframe of the
relevant market, the investments concerned are recognised or
derecognised on the trade date.
All investments are designated upon initial recognition as 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 closing price for Stock Exchange Electronic Trading
Service ('SETS'). The Company derecognises a financial asset only
when the contractual rights to the cash flows from the asset
expire, or when it transfers the financial asset and substantially
all the risks and rewards of ownership of the asset to another
entity. On derecognition of a financial asset, the difference
between the asset's carrying amount and the sum of consideration
received and receivable and the cumulative gain or loss that had
been accumulated is recognised in profit or loss.
Fair values for unquoted investments, or investments for which
the market is inactive, are established by using various valuation
techniques in accordance with the International Private Equity and
Venture Capital Valuation (the "IPEV") guidelines. These may
include recent arm's length market transactions, earnings multiples
and the net asset basis.
All investments for which a fair value is measured or disclosed
in the financial statements are categorised within the fair value
hierarchy levels set out in note 7 below.
g) Foreign currency translation
Transactions in currencies other than Sterling are recorded at
the rates of exchange prevailing on the date of the transaction.
Items that are denominated in foreign currencies are retranslated
at the rates prevailing on the Balance Sheet date. Any gain or loss
arising from a change in exchange rate subsequent to the date of
the transaction is included as an exchange gain or loss in the
capital reserve or the revenue account depending on whether the
gain or loss in the capital reserve or the revenue account
depending on whether the gain or loss is capital or revenue in
nature.
h) 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 which are subject
to insignificant risk of changes in value.
For the purpose of the Statement of Cash Flows, cash and cash
equivalents consist of cash and cash equivalents as defined above,
net of outstanding bank overdrafts when applicable.
i) Other receivables and payables
Trade receivables and trade payables are measured at amortised
cost and balances revalued for exchange rate movement.
j) Income
Dividends receivable on quoted equity shares are taken to
revenue on an ex-dividend basis. Dividends receivable on equity
shares where no ex-dividend date is quoted are brought into account
when the Company's right to receive payment is established.
Dividends from overseas companies are shown gross of any
withholding taxes which are disclosed separately in the Statement
of Comprehensive Income.
Special dividends are taken to the revenue or capital account
depending on their nature. In deciding whether a dividend should be
regarded as capital or revenue receipt, the Board reviews all
relevant information as to the sources of the dividend on a
case-by-case basis.
When the Company has elected to receive scrip dividends in the
form of additional shares rather than in cash, the amount of the
cash dividend foregone is recognised as income. Any excess in the
value of the cash dividend is recognised in the capital column.
All other income is accounted on a time-apportioned accruals
basis and is recognised in the Statement of Comprehensive
Income.
k) Expenses
All expenses are accounted on an accruals basis and are
allocated wholly to revenue with the exception of the Performance
Fees and transaction costs which are allocated wholly to capital,
as the fee payable by reference to the capital performance of the
Company.
l) Taxation
The charge for taxation is based on the net revenue for the year
and takes into account taxation deferred or accelerated because of
temporary differences between the treatment of certain items for
accounting and taxation purposes.
Deferred tax is provided using the liability method on temporary
differences between the tax bases of assets and liabilities and
their carrying amount for financial reporting purposes at the
reporting date. Deferred tax assets are only recognised if it is
considered more likely than not that there will be suitable profits
from which the future reversal of timing differences can be
deducted. In line with recommendations of the SORP, the allocation
method used to calculate the tax relief expenses charged to capital
is the 'marginal' basis. Under this basis, if taxable income is
capable of being offset entirely by expenses charged through the
revenue account, then no tax relief is transferred to the capital
account.
m) Dividends payable to shareholders
Dividends to shareholders are recognised as a liability in the
period in which they are paid or approved in general meetings and
are taken to the Statement of Changes in Equity. Dividends declared
and approved by the Company after the Balance Sheet date have not
been recognised as a liability of the Company at the Balance Sheet
date.
n) Share capital and reserves
The share capital represents the nominal value of equity
shares.
The share premium account represents the accumulated premium
paid for shares issued above their nominal value less issue
expenses.
The special distributable reserve was created on 7 August 2018.
This reserve may be used for the costs of share buybacks and the
cancellation of shares.
The capital reserve represents realised and unrealised capital
and exchange gains and losses on the disposal and revaluation of
investments and of foreign currency items. In addition, performance
fee costs are allocated to the capital reserve.
The revenue reserve represents the surplus of accumulated
revenue profits being the excess of income derived from holding
investments less the costs associated with running the Company.
This reserve may be distributed by way of dividends.
2. Income
Year ended Year ended Year ended Period
ended
31 March 31 March 31 March 31 March
2020 2020 2020 2019
Income Capital Total Total
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- ------------ ------------ ------------ ---------
Income from investments
UK dividends 1,922 133 2,055 632
Unfranked investment income - - - 34
------------ ------------ ------------ ---------
Other income
Bank interest received 24 - 24 49
Other income 3 - 3 -
------------ ------------ ------------ ---------
Total income 1,949 133 2,082 715
------------ ------------ ------------ ---------
3. Portfolio management fee
Year ended 31 March Period ended 31 March
2020 2019
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------- -------- -------- -------- -------- -------- --------
Management fee 904 - 904 784 - 784
Performance fee - - - - - -
provision
-------- -------- -------- -------- -------- --------
904 - 904 784 - 784
-------- -------- -------- -------- -------- --------
The Company is liable to pay a performance fee depending on the
performance of the Company over a three-year period and thereafter
a rolling three-year period as set out in the Company's prospectus
dated 26 March 2018. Based on the performance of the Company to 31
March 2020, no performance fee has been accrued. As at 8 June 2020,
being the latest date prior to release, due to the impact of market
movements since the period end, the Company has no performance fee
provision included in the NAV.
Pursuant to the terms of the Portfolio Management Agreement, the
Portfolio Manager is entitled, with effect from IPO on 1 May 2018,
to receive an annual management fee equal to the lower of: (i) 1%
of the NAV (calculated before deduction of any accrued but unpaid
Management fee and any performance fee) per annum; or (ii) 1% per
annum of the Company's market capitalisation. The annual management
fee is calculated and accrues daily and is payable quarterly in
arrears.
In addition, the Portfolio Manager will be entitled to a
performance fee (the "Performance Fee") in certain
circumstances.
The Company's performance is measured over rolling three-year
periods ending on 31 March each year (each a "Performance Period"),
by comparing the NAV total return per ordinary share over a
Performance Period against the total return performance of the NSCI
ex IC plus AIM Total Return Index (the "Comparator Index"). The
first Performance Period will run from IPO to 31 March 2021.
A Performance Fee is payable if the NAV per ordinary share at
the end of the relevant Performance Period (as adjusted to: (i) add
back the aggregate value of any dividends per ordinary share paid
(or accounted as paid for the purposes of calculating the NAV) to
shareholders during the relevant Performance Period; and (ii)
exclude any accrual for unpaid Performance Fee accrued in relation
to the relevant Performance Period) (the "NAV Total Return per
Share") exceeds both:
(i) (a) the NAV per ordinary share IPO, in relation to the first
Performance Period; and (b) thereafter the NAV per ordinary share
on the first business day of a Performance Period; in each case as
adjusted by the aggregate amount of (i) the total return on the
Comparator Index (expressed as a percentage); and (ii) 1% per annum
over the relevant Performance Period (the "Target NAV per
Share");
(ii) the highest previously recorded NAV per ordinary share as
at the end of the relevant Performance Period in respect of which a
Performance Fee was last paid (or the NAV per ordinary share as at
IPO, if no Performance Fee has been paid) (the "High Watermark");
and
(iii) with any resulting excess amount being known as the
"Excess Amount".
The Portfolio Manager will be entitled to 10% of the Excess
Amount multiplied by the time weighted average number of ordinary
shares in issue during the relevant Performance Period to which the
calculation date relates. The Performance Fee will accrue
daily.
Payment of a Performance Fee that has been earned will be
deferred to the extent that the amount payable exceeds 1.75% per
annum of the NAV at the end of the relevant Performance Period
(amounts deferred will be payable when, and to the extent that,
following any later Performance Period(s) with respect to which a
Performance Fee is payable, it is possible to pay the deferred
amounts without causing that cap to be exceeded or the relevant NAV
total return per share to fall below both the relevant target NAV
per share and the relevant High Watermark for such Performance
Period, with any amount not paid being retained and carried
forward).
Subject at all times to compliance with relevant regulatory and
tax requirements, any Performance Fee paid or payable shall:
- where as at the relevant calculation date, the ordinary shares
are trading at, or at a premium to, the latest published NAV per
ordinary share, be satisfied as to 50% of its value by the issuance
of new ordinary shares by the Company to the Portfolio Manager
(rounded down to the nearest whole number of ordinary shares)
(including the reissue of treasury shares) issued at the latest
published NAV per ordinary share applicable at the date of
issuance;
- where as at the relevant calculation date, the ordinary shares
are trading at a discount to the latest published NAV per ordinary
share, be satisfied as to 100% of its value in cash and the
Portfolio Manager shall, as soon as reasonably practicable
following receipt of such payment, use 50% of such Performance Fee
payment to make market purchases of ordinary shares (rounded down
to the nearest whole number of ordinary shares) within four months
of the date of receipt of such Performance Fee payment.
(in each case "Restricted Shares").
Each such tranche of Restricted Shares issued to, or acquired
by, the Portfolio Manager will be subject to a lock-up undertaking
for a period of three years post issuance or acquisition (subject
to customary exceptions).
At no time shall the Portfolio Manager (and/or any persons
deemed to be acting in concert with it for the purposes of the
Takeover Code) be obliged, in the absence of a relevant whitewash
resolution having been passed in accordance with the Takeover Code,
to receive, or acquire, further ordinary shares where to do so
would trigger a requirement to make a mandatory offer pursuant to
Rule 9 of the Takeover Code. Where any restriction exists on the
issuance of further ordinary shares to the Portfolio Manager, the
relevant amount of the Performance Fee may be paid in cash.
In addition, the Portfolio Manager is entitled to reimbursement
for all costs and expenses properly incurred by it in the
performance of its duties under the Portfolio Management
Agreement.
The initial term of the Portfolio Management Agreement is three
years commencing on the date of IPO (the "Initial Term"). The
Company may terminate the Portfolio Management Agreement by giving
the Portfolio Manager not less than six months' prior written
notice, such notice not to be served prior to the end of the
Initial Term. The Portfolio Manager may terminate the Portfolio
Management Agreement by giving the Company not less than six
months' prior written notice, such notice not to be served prior to
the end of the Initial Term.
4. Other expenses
Year ended Period ended
31 March 31 March
2020 2019
GBP'000 GBP'000
--------------------------------------- ----------- -------------
Directors' fees* 86 74
Company Secretarial fee 64 57
Administration fee 85 81
Auditor remuneration - audit** 30 29
Auditor remuneration - interim review - 9
Other expenses 230 205
----------- -------------
495 455
----------- -------------
* Peter Hewitt is not receiving a Director fee in respect of his
services to the Company. Each of the Directors has agreed to use
their applicable Directors' fees (net of applicable taxes) to
acquire ordinary shares in the secondary market, subject to
regulatory requirements. In relation to any dealings, the Directors
will comply with the share dealing code adopted by the Company in
accordance with the Market Abuse Regulation. The Board will be
responsible for taking all proper and reasonable steps to ensure
compliance with the share dealing code by the Directors.
** As detailed in the Audit Committee report in the full Annual
Report and Financial Statements. No other fees were paid to the
Auditor during the year (2019: a further GBP30,000 was paid to the
Auditor relating to accounting services for the prospectus at
launch, recognised in the share premium account).
5. Taxation
Year ended 31 March Period ended 31 March
2020 2019
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- -------- -------- -------- -------- -------- --------
Analysis of charge
in year
Current tax:
-------- -------- -------- -------- -------- --------
Overseas tax suffered 7 - 7 5 - 5
-------- -------- -------- -------- -------- --------
7 - 7 5 - 5
-------- -------- -------- -------- -------- --------
The tax assessed for the year is the standard rate of
Corporation Tax in the UK of 19% (2019: 19%). The differences are
explained below:
Year ended 31 March Period ended 31 March
2020 2019
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Net return before
taxation 543 (5,455) (4,912) (524) (1,271) (1,795)
--------- ---------- --------- --------- --------- ---------
Theoretical tax at
UK corporation tax
rate of 19% (2019:
19%) 103 (1,037) (934) (99) (241) (340)
Effects of:
UK dividends that
are not taxable (346) - (346) (120) - (120)
Foreign dividends
that are not taxable (17) - (17) (7) - (7)
Non-taxable investment
losses/(gains) (1) 1,037 1,036 - 241 241
Irrecoverable overseas
tax 7 - 7 5 - 5
Unrelieved excess
expenses 261 - 261 226 - 226
--------- ---------- --------- --------- --------- ---------
7 - 7 5 - 5
--------- ---------- --------- --------- --------- ---------
Factors that may affect future tax charges
At 31 March 2020, the Company had no unprovided deferred tax
liabilities (2019: GBPnil). At that date, based on current
estimates and including the accumulation of net allowable losses,
the Company had unrelieved losses of GBP2,564,000 (2019:
GBP1,189,000) that are available to offset future taxable revenue.
A deferred tax asset of GBP435,000 has not been recognised because
the Company is not expected to generate sufficient taxable income
in future periods in excess of the available deductible expenses
and accordingly, the Company is unlikely to be able to reduce
future tax liabilities through the use of existing surplus
losses.
Deferred tax is not provided on capital gains and losses arising
on the revaluation or disposal of investments because the Trust
meets (and intends to continue for the foreseeable future to meet)
the conditions for approval as an Investment Trust company.
6. Earnings per ordinary share
Year ended 31 March 2020 Period ended 31 March 2019
Basic Basic
Weighted and Weighted and
average diluted average diluted
Net return ordinary earnings Net return ordinary earnings
GBP'000 shares* per share GBP'000 shares* per share
pence pence
--------- ------------ ----------- ----------- ------------- ----------- -----------
Revenue 543 88,257,211 0.6 (529) 88,040,346 (0.6)
Capital (5,455) 88,257,211 (6.2) (1,271) 88,040,346 (1.4)
------------ ----------- ----------- ------------- ----------- -----------
Total (4,912) 88,257,211 (5.6) (1,800) 88,040,346 (2.0)
------------ ----------- ----------- ------------- ----------- -----------
* The Company's weighted average number of ordinary shares for
the period has been calculated from 1 May 2018, being the date the
initial shares were listed for trading.
There are no dilutive instruments issued by the Company.
7. Investments held at fair value through profit or loss
As at As at
31 March 31 March
2020 2019
GBP'000 GBP'000
------------------------------------------- ---------- ----------
Opening book cost 68,330 -
Opening investment holding gains (1,523) -
---------- ----------
Opening fair value 66,807 -
---------- ----------
Analysis of transactions made during
the year
Purchases at cost 28,214 69,211
Sales proceeds received (17,167) (1,138)
Gains/(losses) on investments 4,342 257
Decrease in investment holding gains (9,930) (1,523)
---------- ----------
Closing fair value 72,266 66,807
---------- ----------
Closing book cost 83,719 68,330
Closing investment holding gains/(losses) (11,453) (1,523)
---------- ----------
Closing fair value 72,266 66,807
---------- ----------
Analysis of capital losses
Gains on sales of investments based on
historical cost 4,342 257
Movement in investment holding gains
for the year (9,930) (1,523)
---------- ----------
Net losses on investments held at fair
value (5,588) (1,266)
---------- ----------
Transaction costs 140 384
---------- ----------
The Company is required to classify fair value measurements
using a fair value hierarchy that reflects the significance of the
inputs used in making the measurements. The fair value hierarchy
consists of the following three levels:
- Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.
An active market is a market in which transactions for the asset
or liability occur with sufficient frequency and volume on an
ongoing basis such that quoted prices reflect prices at which an
orderly transaction would take place between market participants at
the measurement date. Quoted prices provided by external pricing
services, brokers and vendors are included in Level 1, if they
reflect actual and regularly occurring market transactions on an
arms length basis.
- Level 2 - Inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either
directly (that is, as prices) or indirectly (that is, derived from
prices).
- Level 3 - Inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
The level in the fair value hierarchy within which the fair
value measurement is categorised in its entirety is determined on
the basis of the lowest level input that is significant to the fair
value measurement in its entirety. For this purpose, the
significance of an input is assessed against the fair value
measurement in its entirety. If a fair value measurement uses
observable inputs that require significant adjustment based on
unobservable inputs, that measurement is a Level 3 measurement.
Assessing the significance of a particular input to the fair value
measurement in its entirety requires judgement, considering factors
specific to the asset or liability.
As at 31 March 2020 As at 31 March 2019
Total Level Level Level Total Level Level Level
1 2 3 1 2 3
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- -------- -------- -------- -------- -------- -------- --------
Quoted at
fair value 72,266 72,266 - - 66,807 66,807 - -
-------- -------- -------- -------- -------- -------- -------- --------
Total 72,266 72,266 - - 66,807 66,807 - -
-------- -------- -------- -------- -------- -------- -------- --------
There were no transfers between levels during the period.
8. Trade and other receivables
As at As at
31 March 31 March
2020 2019
GBP'000 GBP'000
------------------- --------- ---------
Other receivables 187 298
187 298
--------- ---------
9. Trade and other payables
As at As at
31 March 31 March
2020 2019
GBP'000 GBP'000
------------------------ --------- ---------
Due to brokers 1,808 -
Portfolio managers fee 231 208
Directors' fees - 6
Other payables 119 103
--------- ---------
2,158 317
--------- ---------
10. Share capital
Year ended 31 March Period ended 31
2020 March 2019
Number Number
of of
Shares GBP'000 Shares GBP'000
Issued and fully paid:
Ordinary shares of 1p:
Balance at beginning of the
period 88,257,211 883 - -
Initial share issue - - 87,457,211 875
Subsequent share issues - block
listing - - 800,000 8
------------ -------- ----------- --------
Balance at end of the period 88,257,211 883 88,257,211 883
------------ -------- ----------- --------
The Company was incorporated with 1 ordinary share and 50,000
management shares. The management shares were cancelled on 1 May
2018. As at 31 March 2020, the Company held no management
shares.
The initial placing of 87,457,210 ordinary shares took place on
1 May 2018, raising gross proceeds of GBP87,457,000. A further
issue of shares of 800,000 took place during the year and raised
gross proceeds of GBP828,000 less issue costs of GBP12,000.
The Company commenced business on 1 May 2018 when the initial
ordinary shares were listed on the premium segment of the Official
List of the FCA and admitted to trading on the premium segment of
the LSE's main market for listed securities.
Following approval of the Court on 8 August 2018, the share
premium account cancellation was effective. The share premium
account of GBP85,495,000 at 7 August 2018 was transferred to a
special distributable reserve. The issue costs of GBP1,447,000
relating to the initial and subsequent listings prior to
cancellation were offset against the share premium account.
11. Net asset value per ordinary share
The net asset value attributable to the ordinary shareholders
and the net asset value per ordinary share at the year end were as
follows:
As at As at
31 March 31 March
2020 2019
Net asset value/shareholders funds GBP80,095,000 GBP85,007,000
Number of ordinary shares in issue at
the year end 88,257,211 88,257,211
Net asset value per share - Basic and
diluted 90.8p 96.3p
12. Financial instruments
Investment objective and policy
The Company primarily invests in smaller company equities quoted
on markets operated by the LSE, which the Portfolio Manager
believes are trading below intrinsic value and where this value can
be increased through strategic, operational, management and
financial initiatives.
The Company's investment objective and policy are detailed in
the full Annual Report and Financial Statements.
The Company's financial instruments include its investment
portfolios, cash balances, trade receivables and trade payables
that arise directly from its operations. Adherence to the Company's
investment policy is key to mitigating risk.
Risks
The Portfolio Manager monitors the financial risks affecting the
Company on an ongoing basis and the Board regularly receive
financial information, which is used to identify and monitor risk.
All risks are actively reviewed and managed by the Board.
The risks identified arising from the Company's financial
instruments are:
(i) market risk, including market price risk, interest rate risk
and currency risk;
(ii) liquidity risk;
(iii) credit and counterparty risk
(i) Market risk
Market risk is the risk of loss arising from movements in
observable market variables. The fair value of future cash flows of
a financial instrument held by the Company may fluctuate because of
changes in market prices. The Portfolio Manager assesses the
exposure to market risk when making each investment decision and
these risks are monitored by the Portfolio Manager on a regular
basis and the Board at meetings with the Portfolio Manager.
Market price risk
The Company is exposed to market price risk (i.e. changes in
market prices other than those arising from currency or interest
rate risk) which may affect the value of investments whose future
prices are uncertain. The Company's exposure to market price risk
comprises movements in the value of the Company's investments. If
the fair value of the Company's investments at the year-end
increased or decreased by 10%, then it would have had an impact on
the Company's capital return and equity of GBP7,227,000 (2019:
GBP6,681,000).
The Portfolio Manager manages this risk by following the
investment objective as set out in the prospectus. The Portfolio
Manager assesses the exposure to market price risk when making each
investment decision and monitors the overall level of market price
risk on the whole investment portfolio on an ongoing basis. The
Portfolio Manager maintains a net cash position and intends to
maintain this for the foreseeable future.
Currency risk
Currency risk is the risk that fair values of future cash flows
of a financial instrument fluctuate because of changes in foreign
exchange rates. The Company has limited exposure to foreign
currency fluctuations, it has only one (2019: one) investment in
EUR fair valued at GBP1,157,000 (2019: GBP1,873,000) impacted by
foreign exchange rates which has an immaterial effect on the
investment portfolio. A 5% rise or decline in Sterling against the
foreign currency denominated investment held at year end would have
increased/decreased the net asset value by GBP58,000 (2019:
GBP94,000). Whilst the Company's other investments are denominated
in Sterling, the Company may have currency exposure through the
trading activities of its investee companies.
The Portfolio Manager does not hedge underlying portfolio
companies.
Interest rate risk
Interest rate risk is the risk that fair value of future cash
flows of a financial instrument will fluctuate because of changes
in market interest rates. Interest rate movements may potentially
affect future cash flows from the level of income receivable on
cash deposits.
The Company's bank balances are subject to a variable rate of
interest, it does not generate significant income from interest and
the Portfolio Manager does not hedge against this. The Company has
no gearing and therefore there is limited downside risk from
increasing interest costs on borrowings.
If the Company maintained the following level of cash for a year
GBP9,800,000 (2019: GBP18,219,000), a 1% increase in interest rates
would increase the revenue return and net assets by GBP98,000
(GBP182,000). If there was a fall of 1% in interest rates, it would
potentially impact the Company by turning positive interest to
negative interest. The total effect would be a revenue
reduction/cost increase of GBP98,000 (2019: GBP182,000).
The portfolio Manager actively manages the cash positions of the
Company.
(ii) Liquidity risk
The Company's assets mainly comprise readily realisable
securities which can be easily sold to meet funding commitments and
obligations. Liquidity risk is mitigated by the fact that the
Company has GBP9,800,000 (2019: GBP18,219,000) cash at bank and the
assets are readily realisable. The Company is a closed-end fund,
assets do not need to be liquidated to meet redemptions.
The Portfolio Manager maintains a net cash position and intends
to maintain this for the foreseeable future. The Portfolio Manager
will manage the portfolio to maintain sufficient cash balances to
meet its obligations or liabilities as they fall due.
(iii) Credit risk
This is the risk a counterparty of the Company will not meet
their obligations to the Company.
The Company does not have any significant exposure to credit
risk arising from one individual party. Credit risk is spread
across a number of counterparties, each having an immaterial effect
on the Company's cash flows, should a default happen. The credit
standing of all counterparties is reviewed periodically and
assesses the debtors to ensure they are neither past due or
impaired.
All the investments of the Company which are traded on a
recognised exchange are held by the Company's custodian, RBC
Investor Services Trust ("RBC"). All the Company's cash is also
held by RBC. The Portfolio Manager and the Board actively monitor
the relationship with RBC and review RBC's internal control
report.
13. Related party transactions
The amounts incurred in respect of Portfolio Management fees
during the period to 31 March 2020 was GBP904,000 (2019: 784,000),
of which GBP231,000 (2019: GBP208,000) was outstanding at 31 March
2020. The amount accrued in relation to the Performance Fee
provision as at 31 March 2020 was GBPnil (2019: GBPnil).
Fees paid to the Company's Directors and Directors'
shareholdings are disclosed in the Directors' Remuneration Report
in the full Annual Report and Financial Statements. At the year
end, there were no outstanding fees payable to Directors (2019:
GBP6,000).
14. Subsequent events
Since the period end, the Company has bought back 275,000
Ordinary Shares with a nominal value of GBP2,750 at a total cost of
GBP230,000, which have been placed in treasury.
Since 31 March 2020, markets and operations have continued to be
disrupted by the effects of the COVID-19 pandemic. However, since
the year end, the NAV per share has increased by 14.7% to 5 June
2020.
Glossary
AGM
Annual General Meeting
AIC
Association of Investment Companies
Alternative Performance Measure ('APM')
An APM is a numerical measure of the Company's current,
historical or future financial performance, financial position or
cash flows, other than a financial measure defined or specified in
the applicable financial framework.
Comparator Benchmark
The Company's Comparator Benchmark is the NSCI (Numis Smaller
Companies Index) ex IC plus AIM Total Return Index. The benchmark
is used only as a yard stick to compare investment performance.
Cost
The book cost of each investment is the total acquisition value,
including transaction costs, less the value of any disposals or
capitalised distributions allocated on a weighted average cost
basis.
Discount/premium
If the share price is lower than the NAV per share it is said to
be trading at a discount. The size of the discount is calculated by
subtracting the share price from the NAV per share and is usually
expressed as a percentage of the NAV per share. If the share price
is higher than the NAV per share, this situation is called a
premium.
Premium/(Discount) 31 March 31 March
Calculation 2020 2019
--------------------- --------- ---------
Closing NAV per
share (p) 90.8p 96.3p a
Closing share price
(p) 90.0p 99.3p b
(Discount)/Premium
(c=((b-a)/a) x 100
(%) (0.9)% 3.1% c
--------------------- --------- ---------
The discount and performance are calculated in accordance with
guidelines issued by the AIC. The discount is calculated using the
net asset values per share inclusive of accrued income with debt at
market value.
ESG
Environmental, social and governance
EU
European Union
FCA
Financial Conduct Authority
Gearing
Gearing refers to the ratio of the Company's debt to its equity
capital. The Company may borrow money to invest in additional
investments for its portfolio. If the Company's assets grow, the
shareholders' assets grow proportionately more because the debt
remains the same. If the Company's assets fall, the situation is
reversed. Gearing can therefore enhance performance in rising
markets but can adversely impact performance in falling markets.
The Company has no borrowings during the year (2019: nil).
IFRS
International Financial Reporting Standards
IPO
Initial public offering
Key Performance Indicators ('KPIs')
KPI's are a shortlist of corporate attributes that are used to
assess the general progress of the Company.
LSE
London Stock Exchange
Link
Link Company Matters Limited and Link Alternative Fund
Administrators Limited, the Company's current Company Secretary and
Administrator, respectively.
M&A
Mergers and acquisitions
Net Asset Value ('NAV')
The NAV is shareholders' funds expressed as an amount per
individual share. Shareholders' funds are the total value of all of
the Company's assets, at their current market value, having
deducted all liabilities and prior charges at their par value, or
at their asset value as appropriate. The total NAV per share is
calculated by dividing shareholders' funds of GBP80,095,000 (2019:
GBP85,007,000) by the number of Ordinary Shares in issue 88,257,211
(2019: 88,257,211) at the year end.
31 March 31 March
2020 2019
--------------------------------------- -------------- --------------
Net asset value/shareholders funds GBP80,095,000 GBP85,007,000
Number of ordinary shares in issue at
the year end 88,257,211 88,257,211
Net asset value per share - Basic and
diluted 90.8p 96.3p
--------------------------------------- -------------- --------------
NAV total return
NAV total return is the closing NAV per share including any
cumulative dividends paid as a percentage over the opening NAV.
Ongoing Charges Ratio
As recommended by the AIC in its guidance, ongoing charges are
the Company's annualised expenses (excluding finance costs and
certain non-recurring items) expressed as a percentage of the
average monthly net assets of the Company during the year as
disclosed to the LSE.
31 March 31 March
2020 2019
-------------------------------------------- ----------- ------------
Total expenses 1,399,000 1,239,000
Less one time expenses and finance charges - 21,000
Annualised Ongoing charges (a) 1,399,000 1,328,000*
Average net asset value (b) 84,064,000 85,391,000*
Ongoing charges (a/b) expressed as a % 1.7% 1.6%
-------------------------------------------- ----------- ------------
* For the period from commencing trading and listed on the LSE
on 1 May 2018.
P/E
Price earnings ratio
R&D
Research and development
TMT
Technology, media and telecom
Total assets
Total assets are the sum of both fixed and current assets with
no deductions.
Total Return - NAV and Share Price Returns
Total return statistics enable the investor to make performance
comparisons between investment trusts with different dividend
policies. The combined effect of any dividends paid, together with
the rise or fall in the share price or NAV. This is calculated by
the movement in the NAV or share price plus dividend income
reinvested by the Company at the prevailing NAV or share price.
31 March 31 March
NAV Total Return 2020 2019
--------------------------- --------- ----------
Closing NAV per share (p) 90.8p 96.3p a
Opening NAV Per share(p) 96.3p 99.3p b
Dividends reinvested (p) - -
NAV total return
(c=((a-b)/b x 100) (%) (5.7%) (2.1%)(#) c
31 March 31 March
Share Price Total Return 2020 2019
--------------------------- --------- ----------
Closing share price (p) 90.0p 99.3p a
Opening share price (p) 99.3p 100.0p b
Dividends reinvested (p) - -
Share price total return
(c=((a-b)/b x 100) (%) (9.4%) (0.7%)(#) c
(#) For the period from commencing trading and listed on the LSE
on 1 May 2018.
Total return per ordinary share
Total return per ordinary share is the total return for the
period expressed as an amount per weighted average ordinary
share.
UCITS
Undertakings for the Collective Investment in Transferable
Securities
Volatility
The term volatility describes how much and how quickly the share
price or net asset value has tended to change in the past. Those
investments with the greatest movement in their share prices are
known as having high volatility, whereas those with a narrow range
of change are known as having low volatility.
ANNUAL GENERAL MEETING
The Company's AGM will be held at the offices of Odyssean
Capital LLP, 6 Stratton Street, Mayfair, London W1J 8LD at 10.30 am
on 22 September 2020.
The notice of this meeting will be circulated to shareholders in
due course and will also be made available on the Company's website
at www.oitplc.com .
NATIONAL STORAGE MECHANISM
A copy of the Annual Report and Financial Statements will be
submitted shortly to the National Storage Mechanism ("NSM") and
will be available for inspection at the NSM, which is situated at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
ENDS
Neither the contents of Odyssean Investment Trust PLC's website
nor the contents of any website accessible from hyperlinks on the
website (or any website) is incorporated into, or forms part of,
this announcement.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR SSSFWAESSEEM
(END) Dow Jones Newswires
June 09, 2020 02:00 ET (06:00 GMT)
Odyssean Investment (LSE:OIT)
Historical Stock Chart
From Jun 2024 to Jul 2024
Odyssean Investment (LSE:OIT)
Historical Stock Chart
From Jul 2023 to Jul 2024
