23rd Jun 2025 07:00
LONDON STOCK EXCHANGE ANNOUNCEMENT
JPMORGAN EUROPEAN GROWTH & INCOME PLC
FINAL RESULTS FOR THE YEAR ENDED 31ST MARCH 2025
Legal Entity Identifier: 549300D8SPJFHBDGXS57
Information disclosed in accordance with the DTR 4.1.3
HIGHLIGHTS
Performance
• Best performing investment trust in its sector with an outperformance over benchmark and the investment trusts within the Company's peer group over one, three and five year periods.
All periods to 31st March 2025 | One Year % | Three Years % | Five Years % |
Total Return on Net Asset Value per Share | +3.5 | +36.1 | +115.3 |
Benchmark | +2.5 | +25.4 | +76.6 |
Excess | +1.0 | +10.7 | +38.7 |
Return on Share Price | +11.8 | +49.8 | +147.8 |
• The dividend for the 12 months to 31st March 2025 was 4.8p per share, resulting in an
estimated dividend yield of 4.3%. (Based on dividend of 4.8p for the year ended 31st March 2025 divided by the share price of 111.0p as at 31st March 2025.)
The Chair of the Company, Rita Dhut, commented:
"In this twelve-month reporting period to 31st March 2025, I am delighted to report that the Company outperformed its benchmark by 1.0%, making five years of consistent outperformance.
This positive result is even more pleasing given the backdrop of volatile asset markets. Our Investment Manager, empowered by a clear mandate, has the freedom to skilfully navigate European markets, whilst delivering to our shareholders the best of capital growth combined with a consistent income."
Portfolio Managers Alexander Fitzalan Howard, Zenah Shuhaiber and Tim Lewis commented:
"There are reasons to be optimistic about the outlook for European equities. The recent change to German fiscal policy is a sign that Europe may be starting to change direction. The scale of the potential spend on both defence and infrastructure is dramatic and if delivered will lift economic growth and create investment opportunities."
Chair's Statement
Introduction
In this twelve-month reporting period to 31st March 2025, I am delighted to report that the Company outperformed its benchmark by 1.0% making five years of consistent outperformance. This positive result is even more pleasing given the backdrop of volatile asset markets. Our Investment Manager, empowered by a clear mandate, has the freedom to skilfully navigate European markets, whilst delivering to our shareholders the best of capital growth combined with a consistent income.
The election of President Trump in the USA has led to the introduction of geo-economics. It has brought with it much disruption and uncertainty across the globe for the future trajectory of economic growth and inflation. The tragic continuation of the devastating conflicts in Ukraine and the Middle East adds to the risky environment.
The European economy faced significant challenges during the reporting period, with muted economic growth projections and a particularly weak German economy. In response the European Central Bank (ECB) reduced interest rates six times in this reporting period, together with two further quarter point reductions in April and June 2025, reducing the Eurozone interest rate from 3.75% to 2.00%. Inflation in the Eurozone has remained relatively stable, reducing from approximately 2.4% at the start of the reporting period to 2.2% at the close.
European equity markets seemed to have shrugged off any concerns regarding the French hung parliament result in July 2024 and the increased share of the vote achieved by the AfD party in Germany's February 2025 elections, won by the conservative CDU party. In addition, the expected reductions in US military aid to Europe was a major boost to the European defence industry, with European governments' announcing increases in their defence budgets.
In the final quarter of this reporting period, European equities benefited from a positive change in investor sentiment experiencing significant inflows arising from uncertainty in the current US government's economic policy.
Performance
Return on net asset value per share and return on share price
For the Company's financial year ended 31st March 2025 the total return on net asset value per share was +3.5% (debt at fair value). This was an outperformance of 1.0% over its benchmark, which returned +2.5% driven by strong relative stock selection. On 18th June 2025, the total return on net asset value per share since the end of this reporting period was +7.3% (debt at fair value). In their report on page 12 of the annual report and financial statements, the Portfolio Managers review in more detail some of the factors underlying the performance of the Company as well as commenting on the economic and market background over the period.
The total return on share price, which takes into account the movement of the share price and dividends received, over the 12 months delivered a return of +11.8%, which was also an outperformance of the benchmark by a significantly higher margin than the net assets performance. On 18th June 2025, the total return on share price since the end of this reporting period was +10.1%.
For an explanation of the calculation of the Company's total return on net asset value per share and the total return on share price, please see the Glossary of Terms and Alternative Performance Measures on page 99 of the annual report and financial statements.
Revenue and Dividends
During the 12 months to 31st March 2025, the Company's net revenue attributable to shareholders (net return after taxation) was -11.2% at £12,145,000 (2024: £13,683,000) largely as a result of the decrease in dividends received from portfolio companies during the period.
As detailed in the Company's previous annual report and latest RNS announcement on 8th May 2025, the Board's intention is to provide shareholders with a predictable and regular dividend based on 4% of the preceding year end net asset value ('NAV') per share. The Company pays four interim dividends in July, October, January and March.
In line with the above aim, in respect of the year ending 31st March 2025, the Company's dividend was 4.8 pence per share, amounting to £20.4 million. This represents an increase from the £18.1 million paid for 2024, as illustrated in note 10(b) on page 75 of the annual report and financial statements.
For the Company's financial year ending 31st March 2026 the Board has decided to maintain the dividend per share at the same level as the year ended 31st March 2025, despite a small reduction in the Company's NAV as at 31st March 2025 as compared with 31st March 2024. This will result in total annual dividends for the Company's financial year ending 31st March 2026 of marginally in excess of 4% of NAV as at 31st March 2025. Therefore, the Board expects to declare dividends totalling 4.8 pence per ordinary share for the year ending 31st March 2026, being paid in four equal instalments of 1.2 pence per ordinary share in the months as stated above.
On 8th May 2025, the Board declared a first interim dividend of 1.2 pence per share in respect of the financial year ending 31st March 2026, payable on 4th July 2025. As was the case for the Company's dividends in respect of the year ended 31st March 2025, to the extent that brought forward revenue reserves are not sufficient, dividends will be paid from distributable capital reserves for the financial year ending 31st March 2026, as permitted by the Company's Articles.
Gearing
There has been no change in the Investment Manager's permitted gearing range, as previously set by the Board, of between 10% net cash to 20% geared. At 31st March 2025 the Company was 4.3% geared (31st March 2024: 4.5%).
Discounts, Share Issuance and Repurchase
During the period under review, the average discount across the Investment Trust sector has remained relatively high. This has been particularly noticeable in those investment trusts with significant alternative investments with worries over liquidity, realisation and valuation of the underlying positions. For the first three quarters of the Company's financial year the Company's discount hovered around 10% and broadly unchanged relative to its peers. In the early part of the year, the Board undertook buybacks to ensure the discount did not widen beyond our stated objective of 10% under normal market conditions (using the cum-income NAV with debt at fair). However, in the final quarter of the Company's financial year to 31st March 2025, a combination of improving sentiment towards European equities combined with a greater interest in the Company's shares caused the Company's discount to narrow considerably without requiring the Board to be active.
The Company's Ordinary share discount to NAV with debt at fair value as at 31st March 2025 was 5.5%. The average discount of a peer group of six companies as at the same date was approximately 7.5% and reflects the Company's narrowing level of discount in both absolute and relative terms. On 18th June, 2025, the Company's ordinary share's discount was 3.1%, which compares to an average discount of the same peer group of 6.7% as at the same date, though this hides variation in strategy and performance across the sector as well as significant buyback and tender activity which your Board monitors carefully for any implications for the Company.
In the period under review, 7,153,261 Ordinary shares were bought into Treasury. From 1st April 2025 to 18th June 2025, 250,000 Ordinary shares were bought into Treasury. No Ordinary shares were issued.
Marketing and Shareholder Interaction
The Company continues to raise its profile with shareholders and potential investors. It is the Board's view that enhancing the Company's profile will benefit all shareholders, by creating sustained demand for its shares, thereby improving liquidity and scale. Our range of activity is broad seeking to showcase the Company to as wide a relevant audience as possible. The Manager follows an established marketing and investor relations programme targeting institutions, private client stockbrokers and platforms via video conferences, podcasts and in-person meetings. Additionally, we have on-going interaction with national and investment industry journalists demonstrating the knowledge and insight of our managers.
We are careful to undertake this promotional activity in the most effective and controlled manner.
The Board and the Investment Manager maintain a dialogue with the Company's shareholders via regular email updates, which deliver news and views, and discuss the latest performance. If you have not already signed up to receive these communications and you wish to do so, you can opt in via https://tinyurl.com/JEGI-Sign-Up or by scanning the QR code in the margin.
It is the Board's hope that these initiatives will give many more of the Company's current and potential shareholders the opportunity to interact with the Board and portfolio managers.
AIC Investment Week 2024 Nomination
As referred to in my report included in the Company's half year report released in November 2024, the Company was again a nominee in the best investment company in the European sector at the annual AIC Investment Week Award ceremony. When the Company won the award in 2023 the judges had commended the Company's performance and the benefits provided by its simplified and shareholder focused structure.
Board of Directors
As referred to in my report included in the Company's half year report released in November 2024, in line with the Company's Board succession plan, Jutta af Rosenborg retired at the Company's Annual General Meeting on 3rd July 2024 as Director and Audit Committee Chair on reaching her nine-year tenure. Andrew Robson was appointed as the Company's Audit Committee Chair on the same date. On behalf of the Board thanks were given to Jutta af Rosenborg for the diligence, commitment and clear vision that she provided to the Company during her tenure.
During the year, the Board evaluation process reviewed Directors, the Chair, the Committees and the working of the Board as a whole. It was concluded that all aspects of the Board and its procedures were operating effectively. In accordance with corporate governance best practice, all of the Directors retire by rotation at this year's AGM and will offer themselves for re-election/election.
Environmental, Social and Governance
Environmental, Social and Governance ('ESG') considerations are integrated into the Investment Manager's investment process as set out in the ESG Report on page 21 of the annual report and financial statements.
Investment Manager
In January 2025, the Management Engagement Committee undertook a formal review of the Manager and Investment Manager, covering the investment management, company secretarial, administrative and marketing services provided to the Company. The review took account of the Investment Manager's investment performance record, management processes, investment style, resources and risk control mechanisms. I am pleased to report that the Board agreed with the Committee's recommendation that the continued appointment of the Manager is in the interests of shareholders.
Annual General Meeting
The Company's ninety-sixth Annual General Meeting (AGM) will be held at 60 Victoria Embankment, London EC4Y 0JP at 2.00 p.m. on Monday, 28th July 2025. We are pleased to invite shareholders to join us in-person for the Company's AGM, hear from the Portfolio Managers and ask questions. Shareholders wishing to follow the AGM proceedings but choosing not to attend in person will be able to view proceedings live and ask questions (but not vote) through conferencing software. Details on how to register, together with access details, will be available shortly on the Company's website at www.jpmeuropeangrowthandincome.com or by contacting the Company Secretary at [email protected]
My fellow Board members, representatives of JPMorgan and I look forward to the opportunity to meet and speak with shareholders after the formalities of the meeting have been concluded. Shareholders who are unable to attend the AGM are strongly encouraged to submit their proxy votes in advance of the meeting, so that they are registered and recorded at the AGM. Proxy votes can be lodged in advance of the AGM either by post or electronically: detailed instructions are included in the Notes to the Notice of Annual General Meeting on pages 95 to 98 of the annual report and financial statements.
If you hold your shares via an online platform, for further details of how to vote your shares and/or attend the Company's AGM, please see the 'Investing in JPMorgan European Growth & Income plc' on page 103 of the annual report and financial statements.
If there are any changes to these arrangements for the AGM, the Company will update shareholders via the Company's website and an announcement on the London Stock Exchange.
Outlook
European equity markets fell significantly following the announcement of the new US tariff regime in early April 2025, mirroring falls across global equities. Since then, the ongoing US tariff negotiations have continued to dominate the global economic outlook and cause large intraday movements in equity markets creating disruption and uncertainty. Despite the recent volatile backdrop, there are positive signs. Europe's forecast economic growth is projected to move closer to the levels of growth currently forecast in the US. The German government's €500 billion infrastructure fund, announced in March 2025, aims to revitalise the economy with construction, defence and energy sectors expected to benefit. Inflation in the Eurozone is close to the ECB target of 2% and the ECB's vigorous reductions in interest rates signify a positive intent. These are several of the reasons why some forecasters are upgrading their expectations for the Eurozone economy.
Our Investment Manager invests in companies whose fortunes are not immune to the travails of the political machinations taking place. However, as we pass through the three-year mark since the restructuring of the company, it is pleasing to reflect back on the consistency and repeatability of their process which allows them to navigate uncertain times. This approach has delivered robust performance and having invested through many cycles the Board are fully confident in the Portfolio Managers' ability to continue delivering attractive returns going forward.
For and on behalf of the Board
Rita Dhut
Chair
20th June 2025
Portfolio Managers' Report
Market Background
Following a subdued start to the Company's fiscal year Europe ex UK equities finished the year to 31st March 2025 up a modest 2.5% in Sterling terms. The market struggled throughout the autumn in the face of heightened volatility in the bond market and renewed concerns about economic growth. The Eurozone composite Purchasing Managers Index fell to a ten-month low in November as both manufacturing and services contracted. Both Germany and France suffered downturns in economic activity. France in particular suffered from a period of political instability as Prime Minister Michel Barnier lost a no-confidence vote and OAT (French government bond) spreads widened sharply.
Inflationary pressures eased, with headline inflation halving from 2023 levels to 2.2% in March. Despite a slight October uptick due to energy prices, the disinflationary trend continued, providing relief to consumers and businesses. Against this backdrop Monetary policy remained accommodative as the European Central Bank (ECB) cut rates again in June 2025 to 2.00%, with President Lagarde expressing confidence in the disinflation trend whilst reinforcing the message that future moves would be data dependent.
The early months of 2025 saw the market rally sharply. Economic news improved, particularly on the services side, as consumer confidence rose while inflation remained benign and the possibility of a ceasefire in Ukraine led to renewed optimism. However, by March volatility returned to markets as President Trump's tariff and increasingly erratic geopolitical announcements alarmed investors. One consequence has been a decisive response from the European Union regarding raising defence spending. Perhaps most significantly Germany's incoming Chancellor, Friedrich Merz, pushed through a vote to exempt defence and security spending from its conservative debt rules as well as creating a Euro 500 billion fund for infrastructure spending.
Portfolio positioning
Our investment process focuses on identifying companies with improving operational momentum, quality characteristics, and lower valuations. Not every company in the portfolio ticks all three boxes but the portfolio as a whole does. One sector where we continue to find a plethora of ideas is Financials, including both Banks and Insurance stocks, which are in their fifth year of outperforming the broader market. Despite this strong outperformance, stocks within these sectors, such as Unicredit and Allianz (two of our largest active positions), continue to look attractively valued given the strong earnings growth, while returning cash to shareholders via dividends and buybacks continue to be a prevalent theme.
We are also overweight Commercial & Professional Services, an area where our process has shone a light on smaller companies within our investment universe. SPIE, a French company, provides multi-technical engineering services across multiple sectors with strong growth prospects. Consolidating a fragmented market and labour shortages have allowed for pricing power, while they are well-placed to benefit from the announced German fiscal package in early 2025, particularly from the country's investments in electricity distribution.
To view the graph of SPIE SA please see the Company's annual report and financial statements, which will be available to view on the Company's website shortly after release of this announcement.
One area where the Company's position has changed is within consumer sectors, where we have sold some of the more cyclical areas which had done well in the previous year and rotated into stocks within Food/Beverages which showed signs of inflection. As an example, we sold out of Industria de Diseno Textil (Inditex), the brand owner of Zara, as weaker than expected sales in the US led to the first earnings downgrades for the stock in a number of years. On the other hand, the Company initiated a position in Heineken, the Dutch beer producer. After a period of significant inflation in input costs, Heineken demonstrated strong margin improvement in their results by focusing on raising prices, productivity gains, and cost savings programmes while continuing to focus on marketing. Management also announced a shift in capital allocation with the introduction of a Euro 1.5 billion buyback over two years.
The Company has moved further underweight in the Materials sector, and this is now the biggest sector underweight. For instance, Bekaert was sold out of the portfolio as it was impacted by lower wire rod pricing as well as weakness in their rubber business due to a sluggish European automotive market. We also remain underweight Givaudan and Sika as we view them as being relatively expensive.
The portfolio continues to exhibit the characteristics we seek to have, namely that it remains cheaper than the benchmark, and has better quality and momentum characteristics.
To view the graph of portfolio positions please see the Company's annual report and financial statements, which will be available to view on the Company's website shortly after release of this announcement.
Performance Attribution
The portfolio outperformed its benchmark index by 1% with the net asset value (NAV) per share rising 3.5% (with debt valued at fair), predominantly driven by stock selection. As alluded to above, Unicredit, the Italian bank, was once again a main outperformer. Despite lower interest rates, the bank managed to continue to deliver strong financial performance across all lines of its income statement. Unicredit also returned more than Euro 10 billion to shareholders in dividends and buybacks in 2024, a theme which has so far continued into 2025.
Stock selection in the Materials sector was also positive, led by a holding in Heidelberg Materials. The German cement producer is benefiting from a more rational market given regulation which is forcing the cost of carbon onto all producers, forcing some to exit. More recently the stock has also benefitted from hopes of a resolution with Russia and Ukraine and the announced German fiscal stimulus.
On the other hand, the main detracting sector was Capital Goods. This was primarily driven by not owning stocks within the defence sector such as Rheinmetall given their high initial valuations. These stocks, nonetheless, rallied strongly on anticipation that European nations would need to increase their percentage of GDP spent on defence from 2% to 3%.
Portfolio Performance
Year ended 31st March 2025
% | % | |
Contributions to total returns |
|
|
Benchmark total return |
| 2.5 |
Asset Selection (stock/sector/currency) | 1.4 | |
Gearing contribution1 | 0.0 | |
Return on cash | 0.1 | |
Cost of gearing2 | (0.2) | |
Cash/Gearing impact | (0.1) | |
Portfolio return | 3.8 | |
Management fee and Other expenses | (0.7) | |
Share buyback/Issuance | 0.2 | |
Other effects | (0.5) | |
Return on net asset value per share with debt at par valueA |
| 3.3 |
Impact of debt at fair value3 |
| 0.2 |
Return on net asset value per share with debt at fair valueA |
| 3.5 |
Effect of movement in discount |
| 8.3 |
Return on share priceA |
| 11.8 |
Source: JPMAM and Morningstar. All figures are on a total return basis.
Performance attribution analyses how the portfolio achieved its recorded performance relative to its benchmark.
1 Gearing contribution is the aggregated effect of daily gearing on the daily benchmark return during the period.
2 Cost of Gearing calculation is based on finance costs in the financial statements and includes the amortisation of private placement issue costs.
3 See note 17 on page 79 of the annual report and financial statements for reference to fair value of debt.
A Alternative Performance Measure ('APM').
A glossary of terms and APMs is provided on page 99 of the annual report and financial statements.
Outlook
There are reasons to be optimistic about the outlook for European equities. The recent change to German fiscal policy is a sign that Europe may be starting to change direction. The scale of the potential spend on both defence and infrastructure is dramatic and if delivered will lift economic growth and create investment opportunities. Moreover, there is scope for the ECB to continue cutting interest rates to mitigate the negative impact of increased trade tariffs if they materialize. Your managers remain confident that they will continue to find investment opportunities that satisfy our criteria relating to valuation, quality and operational momentum.
Alexander Fitzalan Howard
Zenah Shuhaiber
Tim Lewis
Portfolio Managers 20th June 2025
Principal and Emerging Risks
Movement from | ||||
Principal risk | Description | Mitigation/Control | Prior Year | |
Investment | The Board recognises that performance of the Company's investment portfolio is fundamental to the success of the Company. Investment includes market risk and this arises from uncertainty about the future prices of the Company's investments. It represents the potential loss the Company might suffer through holding investments in the face of negative market movements. Market risk is currently heightened due to various factors highlighted in the Chair's Statement and Portfolio Managers' Report, these include global trade issues, geopolitical conflicts and uncertainty over inflation, interest rates and government deficits. Geopolitical concerns will also impact the market; the current conflicts in the Middle East and Ukraine, tensions with China and the changes in trade and tariff policies introduced by the US government are causing increased volatility in the markets. | In order to achieve the objectives given the risks inherent in investment such as market, gearing, currency and interest rates, investment guidelines, policies and processes are in place which aim to mitigate these risks. They are designed to ensure that the portfolios are managed in a way which is aimed at identifying the best stocks and diversifying risk. Regular reports are received by the Board from the Manager on stock selection, asset allocation, gearing, hedging and costs of running the Company and these are reviewed at each Board meeting in detail. Compliance with investment guidelines and policies are reviewed by the Manager and the Board, and discussed at each board meeting in detail together with an analysis of market parameters affecting the business. The Board considers asset allocation, stock selection and levels of gearing on a regular basis and has set Investment Restrictions and Guidelines which are monitored and reported on by JPMF. The Board monitors the implementation and results of the investment process with the Manager. Further details regarding financial instruments are disclosed in note 21 on pages 81 to 87 of the annual report and financial statements. | No movement | |
Operational | In common with most investment trusts the Board delegates the operation of the business to third parties, the principal delegate being the Manager JPMF. Disruption to, failure of, or fraud in JPMF's accounting, dealing or payments systems or the Depositary or Custodian's records could prevent timely implementation of investment decisions, and potentially shortfalls in the accuracy of reporting and monitoring of the Company's financial position and loss. Cyber crime is a threat to business continuity and security. | Details of how the Board monitors the services provided by JPMF and its associates and the Depositary and Custodian and the key elements designed to provide effective internal control are included within the Internal Control section of the Audit Committee report on page 47 of the annual report and financial statements. The Board has received the cyber security policies of its key third party service providers and JPMF has provided assurance to the Directors that the Company benefits directly or indirectly from all elements of JPMorgan's cyber security programme. The information technology controls around the physical security of JPMorgan's data centres, security of its networks and trading applications are tested and reported on every six months against the AAF standard. | No movement | |
Regulatory | The Company operates in an environment with significant regulation including the FCA Listing Rules, The UK Companies Act, the Corporation Taxes Act, Market Abuse Regulation, Disclosure Guidance and Transparency Regulations and the Alternative Investment Fund Managers Directive (AIFMD). There has been no significant change to this risk during the year though the environment as a whole is considered to be one of increasing costs for compliance. The Company also operates under the requirements of the Bribery Act 2010 as referred to in the Directors Report on page 39 of the annual report and financial statements. | The Board relies on the services of its Company Secretary, the Manager and its professional advisers to ensure compliance with the Companies Act 2006, the FCA Prospectus Rules, Listing Rules, DTRs and the Alternative Investment Fund Managers Directive. | No movement | |
Discount | There is a risk that the share price lags NAV by significant level. A consistent, wide, discount can lead to action by arbitraguers/activist shareholders, who may have undue influence due to lack of retail voting. It can also result in the Company not being able to react to relevant market events (e.g potential consolidation opportunities). The discount may become persistent due to market issues affecting all investment trusts, and may be difficult to manage using normal control mechanisms (eg buy-backs). | The discount is monitored daily and compared to peers/sector by both the Manager and the Broker and a share buy-back programme is in place which can be used when required. The Board has stated it does not wish to see the discount widen beyond 10% in normal market conditions. Industry wide developments are also monitored and considered when evaluating the need for buyback activity. Regular updates and reporting are provided to the Board. Sales and Marketing Plans are in place and are designed to increase demand and diversification of the share register. The Board is prepared to consider and implement other discount control mechanisms. For details of the Performance related Tender Offer see Key Features at the front of this document. | No movement | |
Strategy | An inappropriate investment strategy, for example asset allocation may lead to underperformance against the Company's benchmark index and peer companies. Significant hostile action by shareholder/s - arbitrageurs diverts attention from normal business. These activists may have undue influence due to low level of retail voting, and may have interests not aligned with the majority of shareholders. | The Board reviews the overall strategy and structure of the Company in comparison to performance against benchmark, peer group and share activity. The Board holds a separate meeting devoted to strategy each year which includes consideration of whether the Company's objectives and structures are appropriate for the long term interests of shareholders. The Board and Manager regularly monitor the Company's share register and receipts of formal disclosures of significant transactions. Regular discussions are held with the Company's Brokers. Consideration of possible options to improve retail participation, including through S793 circulation to platform holders. | No movement | |
Climate Change | Climate change, which barely registered with investors a decade ago, continues to be one of the most critical issues confronting asset managers and their investors. Investors can no longer ignore the impact that the world's changing climate will have on their portfolios, with the impact of climate change on returns now inevitable. | The Company's investment process integrates considerations of environmental, social and governance factors into decisions on which stocks to buy, hold or sell. This includes the approach investee companies take to recognising and mitigating climate change risks. The Board is also considering the threat posed by the direct impact on climate change on the operations of the Manager and other major service providers. As extreme weather events become more common, the resiliency, business continuity planning and the location strategies of our services providers will come under greater scrutiny. | No movement | |
Geopolitical and Economic concerns | The recent global trade tensions arising from the changes to U.S trade policy since Trump's election in November 2024, Russia's invasion of Ukraine in February 2022 and conflict in Gaza, with potential for a wider Middle East conflict, may cause long term changes in global trade and technology. This may challenge future growth potential and increased frictions in accessing global markets. Changes in financial or tax legislation in the UK or in some of the countries in which the Company invests may impact the operating model of the Company. In addition policies adopted by Governments/Central banks in response to the issues being seen in markets (e.g. inflation, interest rates and government deficits) may lead to adverse movements in asset prices and could result in concerns for the ongoing exposure to specific investee markets. | The Board addresses these global developments in regular questioning of the Manager and with external expertise as required will continue to monitor these issues, should they develop. The Manager regularly monitors the Company's portfolio holdings to ensure compliance with any applicable sanctions. | Increase | |
Movement from | ||||
Emerging risk | Description | Mitigation/Control | Prior Year | |
Artificial Intelligence (AI) | While it might equally be deemed a great opportunity and force for good, there appears also to be an increasing risk to business and society more widely from AI. Advances in computing power means that AI has become a powerful tool that will impact a huge range of areas. AI could be a significant driver for new business as well as a disrupter to current business and processes leading to added uncertainty in corporate valuations. | The Board will work with the Manager to monitor the developments concerning AI and its potential impact on the portfolio, our service providers and the wider market. | No movement | |
Transactions with the Manager and related parties
Details of the management contract are set out in the Directors' Report on page 39 of the annual report and financial statements. The management fee payable to the Manager for the year was £2,530,000 (2024: £2,381,000), of which £nil (2024: £nil) was outstanding at the year end.
Included in administration expenses in note 6 on page 73 of the annual report and financial statements are safe custody fees amounting to £48,000 (2024: £51,000) payable to JPMorgan Chase Bank, N.A of which £8,000 (2024: £13,000) was outstanding at the year end.
The Manager may carry out some of its dealing transactions through group subsidiaries. These transactions are carried out at arm's length. Commission amounting to £19,000 (2024: £26,000) was payable to JPMorgan Securities Limited for the year of which £nil (2024: £nil) was outstanding at the year end.
The Company holds investments in JPMorgan European Discovery Trust plc, managed by JPMAM. At 31st March 2025 these were valued at £12.2 million (2024: £11.7 million) and represented 2.3% (2024: 2.2%) of the Company's investment portfolio. During the year the Company made £nil purchases of such investments (2024: £nil) and sales with a total value of £nil (2024: £nil). Income amounting to £277,000 (2024: £259,000) was receivable from these investments during the year of which £nil (2024: £nil) was outstanding at the year end.
Securities lending income amounting to £25,000 (2024: £30,000) was receivable by the Company during the year. JPMorgan Chase Bank, N.A, commissions in respect of such transactions amounted to £2,700 (2024: £3,000).
Handling charges on dealing transactions amounting to £14,000 (2024: £10,000) were payable to JPMorgan Chase Bank N.A. during the year of which £1,000 (2024: £1,000) was outstanding at the year end.
At the year end, total cash of £0.6 million (2024: £4.7 million) was held with JPMorgan Chase Bank N.A. A net amount of interest of £2,000 (2024: £3,000) was receivable by the Company during the year from JPMorgan Chase Bank, N.A of which £nil (2024: £nil) was outstanding at the year end.
The Company invests in the JPMorgan EUR Liquidity Fund, a triple A-rated money market fund managed by JPMorgan Asset Management (Europe) S.à r.l.. At the year end this was valued at £14.9 million (2024: £10.4 million). Interest amounting to £489,000 (2024: £490,000) was receivable during the year of which £nil (2024: £nil) was outstanding at the year end.
Full details of Directors' remuneration and shareholdings can be found on pages 50 to 52 and in note 6 on page 73 of the annual report and financial statements.
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law and regulation.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', and applicable law).
Under company law, Directors must not approve the financial statements unless they are satisfied that , taken as a whole, the Annual Report and the Financial Statements are fair, balanced and understandable, provide the information necessary for shareholders to assess the Company's position and performance, business model and strategy and that they give a true and fair view of the state of affairs of the Company and of the total return or loss of the Company for that period. In order to provide these confirmations, and in preparing these financial statements, the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• state whether applicable United Kingdom Accounting Standards, comprising FRS 102 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 a going concern basis unless it is inappropriate to presume that the company will continue in business;
and the Directors confirm that they have done so.
The Directors are responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Directors are also responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006.
The maintenance and integrity of the website maintained by the Manager is, so far as it relates to the Company, the responsibility of the Manager. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Directors' confirmations
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.
Each of the Directors, whose names and functions are listed in page 38 of the annual report and financial statements confirm that, to the best of their knowledge:
• the Company financial statements, which have been prepared in accordance with United Kingdom Accounting Standards, comprising FRS 102, give a true and fair view of the assets, liabilities, financial position and return of the Company; and
• The Strategic Report and the Directors' 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.
For and on behalf of the Board
Rita Dhut
Chair, 20th June 2025
Statement of Comprehensive Income
For the year ended 31st March
2025 | 2024 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Gains on investments and derivatives held at | ||||||
fair value through profit or loss | - | 2,685 | 2,685 | - | 62,285 | 62,285 |
Foreign exchange losses on JPMorgan EUR | ||||||
Liquidity Fund | - | (298) | (298) | - | (355) | (355) |
Net foreign currency gains | - | 2,275 | 2,275 | - | 716 | 716 |
Income from investments | 16,565 | 789 | 17,354 | 16,572 | 129 | 16,701 |
Interest receivable and similar income | 516 | - | 516 | 523 | - | 523 |
Gross return | 17,081 | 5,451 | 22,532 | 17,095 | 62,775 | 79,870 |
Management fee | (759) | (1,771) | (2,530) | (714) | (1,667) | (2,381) |
Other administrative expenses | (747) | - | (747) | (640) | - | (640) |
Net return before finance costs and taxation | 15,575 | 3,680 | 19,255 | 15,741 | 61,108 | 76,849 |
Finance costs | (346) | (808) | (1,154) | (345) | (814) | (1,159) |
Net return before taxation | 15,229 | 2,872 | 18,101 | 15,396 | 60,294 | 75,690 |
Taxation | (3,084) | - | (3,084) | (1,713) | - | (1,713) |
Net return after taxation | 12,145 | 2,872 | 15,017 | 13,683 | 60,294 | 73,977 |
Return per share (Note 2) | 2.85p | 0.67p | 3.52p | 3.17p | 13.97p | 17.14p |
All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or
discontinued in the year.
The 'Total' column of this statement is the profit and loss account of the Company and the 'Revenue' and 'Capital' columns
represent supplementary information prepared under guidance issued by the Association of Investment Companies.
Net return after taxation represents the profit for the year and also Total Comprehensive Income.
The notes on pages 69 to 89 of the annual report and financial statements form an integral part of these financial statements.
Statement of Changes in Equity
Called up | Share | Capital | ||||
share | premium | redemption | Capital | Revenue | ||
capital | account | reserve | reserves1 | reserve1 | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 31st March 2023 | 2,185 | 131,163 | 18,273 | 299,679 | 3,946 | 455,246 |
Repurchase of shares into Treasury | - | - | - | (4,934) | - | (4,934) |
Net return | - | - | - | 60,294 | 13,683 | 73,977 |
Dividends paid in the year (note 3) | - | - | - | - | (13,598) | (13,598) |
At 31st March 2024 | 2,185 | 131,163 | 18,273 | 355,039 | 4,031 | 510,691 |
Repurchase of shares into Treasury | - | - | - | (7,259) | - | (7,259) |
Net return | - | - | - | 2,872 | 12,145 | 15,017 |
Dividends paid in the year (note 3) | - | - | - | (3,694) | (16,176) | (19,870) |
At 31st March 2025 | 2,185 | 131,163 | 18,273 | 346,958 | - | 498,579 |
1 These reserves form the distributable reserves of the Company and may be used to fund distribution of profits to investors via dividend payments.
Statement of Financial Position
At 31st March
2025 | 20241 | |
£'000 | £'000 | |
Non current assets | ||
Investments held at fair value through profit or loss1 | 512,436 | 518,303 |
Investments on loan held at fair value through profit or loss1 | 7,409 | 15,388 |
Total investments held at fair value through profit or loss | 519,845 | 533,691 |
Current assets | ||
Derivative financial assets | 31 | 218 |
Debtors | 5,254 | 5,541 |
Cash and cash equivalents | 15,490 | 15,074 |
20,775 | 20,833 | |
Current liabilities | ||
Creditors: amounts falling due within one year | (280) | (392) |
Derivative financial liabilities | (41) | (833) |
Net current assets | 20,454 | 19,608 |
Total assets less current liabilities | 540,299 | 553,299 |
Non current liabilities | ||
Creditors: amounts falling due after more than one year | (41,720) | (42,608) |
Net assets | 498,579 | 510,691 |
Capital and reserves | ||
Called up share capital | 2,185 | 2,185 |
Share premium account | 131,163 | 131,163 |
Capital redemption reserve | 18,273 | 18,273 |
Capital reserves | 346,958 | 355,039 |
Revenue reserve | - | 4,031 |
Total shareholders' funds | 498,579 | 510,691 |
Net asset value per share (Note 4) | 118.1p | 119.0p |
1 The value of investments on loan, previously included within the total value of investments held at fair value through profit or loss, has been disclosed separately this year. Prior year figures have been restated accordingly. These changes do not impact the Company's Net assets, Statement of Comprehensive Income, or Statement of Cash Flows.
Statement of Cash Flows
For the year ended 31st March
2025 | 2024 | |
£'000 | £'000 | |
Cash flows from operating activities | ||
Net return before finance costs and taxation | 19,255 | 76,849 |
Adjustment for: | ||
Net gains on investments held at fair value through profit or loss | (2,685) | (62,285) |
Foreign exchange losses on JPMorgan EUR Liquidity Fund | 298 | 355 |
Net foreign currency gains | (2,275) | (716) |
Dividend income | (17,354) | (16,701) |
Interest income | (491) | (493) |
Realised gains on foreign exchange transactions | 56 | 25 |
Realised exchange (losses)/gains on JPMorgan EUR Liquidity Fund | (375) | 155 |
(Increase)/decrease in accrued income and other debtors | (1) | 2 |
(Decrease)/increase in accrued expenses | (10) | 33 |
Net cash outflow from operations before dividends, interest and taxation | (3,582) | (2,776) |
Dividends received | 13,970 | 13,858 |
Interest received | 491 | 493 |
Overseas withholding tax recovered | 1,218 | 370 |
Net cash inflow from operating activities | 12,097 | 11,945 |
Purchases of investments and derivatives | (163,135) | (129,717) |
Sales of investments | 179,036 | 127,480 |
Settlement of forward foreign currency contracts | 716 | 33 |
Net cash inflow/(outflow) from investing activities | 16,617 | (2,204) |
Equity dividends paid | (19,870) | (13,598) |
Repurchase of shares into Treasury | (7,364) | (4,924) |
Interest paid | (1,138) | (1,159) |
Net cash outflow from financing activities | (28,372) | (19,681) |
Increase/(decrease) in cash and cash equivalents | 342 | (9,940) |
Cash and cash equivalents at start of year | 15,074 | 25,523 |
Exchange movements | 74 | (509) |
Cash and cash equivalents at end of year | 15,490 | 15,074 |
Cash and cash equivalents consist of: | ||
Cash and short term deposits | 632 | 4,698 |
Cash held in JPMorgan EUR Liquidity Fund | 14,858 | 10,376 |
Total | 15,490 | 15,074 |
Notes to the Financial Statements
For the year ended 31st March 2025
1. Accounting policies
(a) Basis of accounting
The financial statements are prepared under the historical cost convention, modified to include fixed asset investments and derivatives at fair value, and in accordance with the Companies Act 2006, United Kingdom Generally Accepted Accounting Practice ('UK GAAP'), including 'the Financial Reporting Standard applicable in the UK and Republic of Ireland' ('FRS 102') and with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' (the 'SORP') issued by the Association of Investment Companies in July 2022.
All of the Company's operations are of a continuing nature.
The financial statements have been prepared on a going concern basis. In forming this opinion, the Directors have considered as part of its risk assessment: the nature of the Company, its business model and related risks including ongoing conflict between Ukraine and Russia, the requirements of the applicable financial reporting framework, the covenants in respect of the Company's private placement debt and the system of internal control.
The Directors believe that, having considered the Company's investment objectives, future cash flow projections, risk management policies, liquidity risk, principal and emerging risks, capital management policies and procedures, nature of the portfolios and expenditure projections, the Company has adequate resources, an appropriate financial structure and suitable management arrangements in place to continue in operational existence to 30th June 2026, being at least 12 months from approving this annual report and financial statements.
For these reasons, they consider that there is reasonable evidence to continue to adopt the going concern basis in preparing the report.
The policies applied in these financial statements are consistent with those applied in the preceding year.
2. Return per share
2025 | 2024 | |
£'000 | £'000 | |
Return per share is based on the following: | ||
Revenue return | 12,145 | 13,683 |
Capital return | 2,872 | 60,294 |
Total return | 15,017 | 73,977 |
Weighted average number of shares in issue during the year | 426,040,273 | 431,452,567 |
Revenue return per share | 2.85p | 3.17p |
Capital return per share | 0.67p | 13.97p |
Total return per share | 3.52p | 17.14p |
3. Dividends
(a) Dividends paid and declared
2025 | 2024 | |||
Pence | £'000 | Pence | £'000 | |
Dividends paid | ||||
Fourth interim dividend in respect of prior year | 1.05 | 4,510 | - | - |
First interim dividend | 1.20 | 5,148 | 1.05 | 4,556 |
Second interim dividend | 1.20 | 5,128 | 1.05 | 4,529 |
Third interim dividend | 1.20 | 5,084 | 1.05 | 4,513 |
Total dividends paid in the year | 4.65 | 19,870 | 3.15 | 13,598 |
Dividends declared | ||||
Fourth interim dividend | 1.20 | 5,064 | 1.05 | 4,510 |
Total dividends declared1 | 1.20 | 5,064 | 1.05 | 4,510 |
1 In accordance with the accounting policy of the Company, these dividends will be reflected in the financial statements of the following year.
The fourth quarterly dividend of 1.20p was paid on 4th April 2025 for the financial year ended 31st March 2025. In accordance with the accounting policy of the Company, this dividend will be reflected in the financial statements for the year ending 31st March 2026.
The first interim dividend of 1.20 pence per share in respect of the Company's financial year ending 31st March 2026 was declared on 8th May 2025 for shareholders on the register on 16th May 2025 with payment on 4th July 2025.
During the year, dividends paid amounted to £19,870,000 (2024: £13,598,000), of which £16,176,000 (2024: £13,598,000) were paid from current year revenue and revenue reserves of £16,176,000 (2024: £17,629,000). The remaining dividend of £3,694,000 (2024: nil) was funded from capital reserves as show in the Statement of Changes in Equity on page 78 of the annual report and financial statements.
(b) Dividend for the purposes of Section 1158 of the Corporation Tax Act 2010 ('Section 1158')
The requirements of Section 1158 are considered on the basis of dividends declared in respect of the financial year, as follows:
The revenue available for distribution by way of dividend for the year is £12,145,000 (2024: £13,683,000).
2025 | 2024 | |||
Pence | £'000 | Pence | £'000 | |
First interim dividend | 1.20 | 5,148 | 1.05 | 4,556 |
Second interim dividend | 1.20 | 5,128 | 1.05 | 4,529 |
Third interim dividend | 1.20 | 5,084 | 1.05 | 4,513 |
Fourth interim dividend | 1.20 | 5,064 | 1.05 | 4,510 |
Total | 4.80 | 20,424 | 4.20 | 18,108 |
4. Net asset value per share
The net asset value per Ordinary share and the net asset value attributable to the Ordinary shares at the year end are shown below. These were calculated using 422,016,188 (2024: 429,169,449) Ordinary shares in issue at the year end (excluding Treasury shares).
2025 | 2024 | |||
Net asset value attributable | Net asset value attributable | |||
£'000 | pence | £'000 | pence | |
Net asset value - debt at par | 498,579 | 118.1 | 510,691 | 119.0 |
Add: Amortised cost of the Euro 50 million | ||||
2.69% Private Placement Note with Metlife, | ||||
repayable on 26th August 2035 | 41,720 | 9.9 | 42,608 | 9.9 |
Less: Fair Value of the Euro 50 million 2.69% | ||||
Private Placement Note with Metlife, repayable | ||||
on 26th August 2035 | (39,321) | (9.3) | (41,110) | (9.6) |
Net asset value - debt at fair value1 | 500,978 | 118.7 | 512,189 | 119.3 |
1 See the glossary of terms on page 99 of the annual report and financial statements.
5. Analysis of Changes in Net Debt
As at | Other | As at | ||||
31st March | Exchange | non-cash | 31st March | |||
2024 | Cash flows | movements | changes | 2025 | ||
£'000 | £'000 | £'000 | £'000 | £'000 | ||
Cash and cash equivalents | ||||||
Cash and short term deposits | 4,698 | (4,063) | (3) | - | 632 | |
Cash held in JPMorgan EUR Liquidity Fund | 10,376 | 4,405 | 77 | - | 14,858 | |
15,074 | 342 | 74 | - | 15,490 | ||
Borrowings | ||||||
Debt due after one year | ||||||
- Metlife Private Placement | (42,608) | - | 900 | (12) | (41,720) | |
Net debt | (27,534) | 342 | 974 | (12) | (26,230) |
2024 Financial Information
The figures and financial information for 2024 are extracted from the published Annual Report and Financial Statements for the year ended 31st March 2024 and do not constitute the statutory accounts for that year. The Annual Report and Financial Statements has been delivered to the Registrar of Companies and included the Report of the Independent Auditors which was unqualified and did not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006.
2025 Financial Information
The figures and financial information for 2025 are extracted from the Annual Report and Financial Statements for the year ended 31st March 2025 and do not constitute the statutory accounts for the year. The Annual Report and Financial Statements includes the Report of the Independent Auditors which is unqualified and does not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006. The Annual Report and Financial Statements will be delivered to the Registrar of Companies in due course.
JPMORGAN FUNDS LIMITED
23rd June 2025
For further information, please contact:
Paul Winship
For and on behalf of
JPMorgan Funds Limited Telephone: 0800 20 40 20 or or +44 1268 44 44 70
Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.
ENDS
Annual Report and Financial Statements
The Annual Report and Financial Statements will be posted to shareholders soon after the release of this report and will shortly be available on the Company's website www.jpmeuropeangrowthandincome.com or in hard copy format from the Company's Registered Office, 60 Victoria Embankment London EC4Y 0JP.
A copy of the annual report will shortly be submitted to the FCA's National Storage Mechanism and will be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism
Up to date information on the Company, including daily NAV and share prices, factsheets and portfolio information can also be found on the Company's website at www.jpmeuropeangrowthandincome.com
Related Shares:
Jpmorgan Euro.