Interim Management Statement Q4 2025

Core Viewpoint - The final quarter of 2025 showed gradual improvement in UK financial markets, with investors beginning to look beyond earlier turbulence, despite ongoing concerns about inflation and household demand [3][4]. Economic Overview - UK CPI rose to 3.8% in July, plateauing in August and September, with a lower-than-expected September reading potentially indicating a period of lower inflation [4] - Unemployment increased to 4.8% in August, allowing the Bank of England to consider further interest rate cuts after a 25bps reduction to 4.00% in August [4] - Consumer sentiment improved, although households remained cautious with high savings rates and reduced debt [5] - Gilt yields rose due to concerns over public spending and high inflation, indicating challenges for the upcoming Autumn Budget [6] Investment Performance - The unaudited NAV per share increased from 36.43 pence to 36.46 pence, with a total return of +3.51% for shareholders [8] - Qualifying investments contributed positively, with Qureight increasing by 102.4% and Diaceutics by 41.7% [9][10] - Non-qualifying investments saw mixed results, with the IFSL Marlborough UK Micro-Cap Growth Fund and Special Situations Fund posting gains, while WH Smith faced issues due to accounting irregularities [15] Portfolio Structure - The company maintained a strong investment position, ending the period at 98.98% invested, with an increase in qualifying investments from 53.7% to 54.1% [16] - There were no new VCT qualifying IPOs in the quarter, but the company remains optimistic about future deal flow [17] - The company executed three full exits and adjusted its investment in Cohort following strong share price performance [18] Share Buybacks and Market Activity - The company repurchased 3.7 million shares at an average price of 33.31 pence, with the share price increasing from 34.10 pence to 34.40 pence [21] - As of 30 September 2025, the shares traded at a discount of 3.83% to the last published NAV per share [21] Post Period Developments - The unaudited NAV per share decreased to 35.84 pence as of 31 October 2025, reflecting a decline of 1.70% [22]