Half-year Report

LONDON STOCK EXCHANGE ANNOUNCEMENT

JPMORGAN ELECT PLC

UNAUDITED HALF YEAR RESULTS FOR THE SIX MONTHS

ENDED 28 FEBRUARY 2017

Legal Entity Identifier: 549300FIUYKKL39ILD07

CHAIRMAN'S STATEMENT

Dear Shareholders,

In my report to you last year I predicted bouts of volatility as negotiation on the terms and timing of Brexit unfolded. Despite this uncertainty, UK and global equities performed strongly in sterling terms during the half year to 28th February 2017, supported by the devaluation of the pound, the anticipation of fiscal stimulus that followed the outcome of the US elections and the continuation of a relatively low interest rate environment. Consequently, the total return on the Company's net assets over the period was +11.8% for the Managed Growth portfolio and +8.1% for the Managed Income portfolio, outperforming each portfolio's respective benchmarks. The total return on the Managed Cash portfolio was +0.2%.

Managed Growth

The Managed Growth portfolio has delivered a total return on net assets of +11.8%, compared with the portfolio's benchmark which returned +11.2%. The share price total return was +11.3%.

As you know, the objective of this share class is long term capital growth. The significant overseas exposure of this portfolio and improving global economic data contributed to this strong performance.

For the half year ended 28th February 2017 the Board declared dividends of 5.45p per Managed Growth share compared to 4.05p for the half year ended 28th February 2016. Since the main objective of the share class is capital appreciation, dividends may be volatile from year to year as the Managers seek to maximise total return.

Managed Income

The Managed Income portfolio has delivered a total return on net assets of +8.1% compared with the portfolio's benchmark which returned +7.0%. The share price total return was +8.6%.

The objective of the portfolio is to deliver a growing income return with the potential for long term capital growth. In the aftermath of the result of the EU referendum sterling weakened materially. This has had a positive impact on some of the key UK dividend payers, who declare their dividends in US dollars, such as the major oil stocks and the major pharmaceuticals. Whilst this has been positive, the number of special dividends received by the portfolio has declined from the prior corresponding period.

The outlook for UK dividend payments is mixed. A number of factors, including Brexit negotiations, have the potential to impact the profits and cash flow of domestic UK companies.

For the half year ended 28th February 2017 the Board declared dividends of 1.70p per Managed Income share, unchanged from the same period last year.

Managed Cash

The Managed Cash Portfolio delivered a total return on net assets of +0.2%. The share price total return was -0.7%.

The portfolio's primary objective remains capital preservation through investment in high quality liquidity funds. During the half year the Bank of England base rate remained unchanged at 0.25%.

The Managed Cash portfolio is invested in liquidity funds with AAA ratings as measured by Standard & Poor's, or an equivalent rating agency.

The Board considers this class to be an asset allocation tool which continues to benefit shareholders of all of the Company's share classes, offering the opportunity to switch into a safer share class in times of market volatility.

JPMorgan Income and Growth and M&G High Income Investment Trust

During the half year period your Board recommended that shareholders approve the issue of new shares in connection with the reconstruction of JPMorgan Income & Growth Investment Trust plc ('JPMIG') and M&G High Income Investment Trust plc ('HIIT'). The transactions resulted in the acquisition of approximately £21.5 million of net assets from JPMIG and £14 million of net assets from HIIT.

The Board are pleased with the outcome of the transactions and I would like to welcome the new shareholders to the Trust. It is our hope that over time such transactions will increase liquidity in Managed Cash Shares, Managed Growth Shares and Managed Income Shares. By spreading the fixed costs of managing the Company over a wider asset base the Ongoing Charges Ratio has been reduced.

Board Appointment

Karl Sternberg was appointed as an Independent non-executive Director of the Company on 16th December 2016. Mr. Sternberg is the former Chairman of JPMIG. His appointment follows the successful reconstruction of JPMIG and the resulting issue of new shares by the Company.

Mr. Sternberg is a director of Jupiter Fund Management, Lowland Investment Company, Monks Investment Trust, Clipstone Logistics REIT, Herald Investment Trust, Alliance Trust and Railway Pension Investments. He brings to the Board valuable leadership skills, investment insight and an in-depth knowledge of the asset management industry.

Outlook

The journey to leave the European Union involves uncertainty as the negotiations on the terms and timing of Brexit take place. These have the potential to have a profound impact on UK and European markets as do elections in Germany, France and the UK. Continued uncertainty seems likely, offering both risks and opportunity.

Angus Macpherson

Chairman 27th April 2017

MANAGED GROWTH SHARE CLASS

INVESTMENT MANAGERS' REPORT

Performance Review

The Managed Growth portfolio outperformed its benchmark over the half year period, returning +11.8% versus the benchmark return of +11.2%. Taking into account the discount, the return to shareholders was +11.3%.

Robust and improving global economic data released during the first half of the financial year fuelled a rally in global equity markets, with manufacturing purchasing managers' indices in both the US and Europe hitting new highs. Markets also reacted positively to the news that Donald Trump would be the next US President and the Republicans would retain control of the House and the Senate. This outcome was priced as reflationary amid expectations for significant fiscal stimulus, boosting US growth prospects into 2017 and beyond.

Against this backdrop the return on net assets outperformed the portfolio's benchmark. The outperformance was generated by positive stock selection in the underlying strategies, boosted by a narrowing of investment trust discounts generally. Amongst the top performers in the UK were Blackrock Smaller Companies, JPMorgan Claverhouse and Fidelity Special Values.

Whilst some strategies did underperform against their benchmarks, seven out of the portfolio's 10 largest holdings outperformed over the half year period.

At the period end the average discount in the investment trust sector (excluding private equity funds, hedge funds and direct property funds) was 5.8%, compared with 7.0% at the end of August 2016 (Source: Winterflood). We estimate that the Managed Growth portfolio's return was boosted by around 0.4% from this narrowing of discounts.

The portfolio benefited from being overweight in US equity strategies as sterling weakened and US equities performed well. Our underweight position in UK equities also boosted relative performance of the portfolio.

Portfolio Review

At the end of February 2017, 43% of the portfolio was invested in JPMorgan managed investment trusts, 30% in JPMorgan managed open-ended funds and 27% in investment trusts managed by third-party managers.

We remained underweight in UK equities and overweight in US equities. The most notable geographical change has been an increase in our allocation to Japanese equities, moving from an underweight to an overweight position. We reduced our European equities exposure to a neutral position.

We took profits in JPMorgan US Equity All Cap Fund, JPMorgan Smaller Companies Investment Trust, JPMorgan European Investment Trust (Growth shares) and Fidelity European Values. Proceeds were reinvested into existing holdings: Murray Income Trust, Blackrock Smaller Companies, Blackrock Frontiers Investment Trust and JPMorgan Emerging Markets.

Outlook

Broadening global growth and signs that the reflation which began in the summer of last year is gaining traction, suggest a continued positive outlook for equities in 2017. Although the US has increased interest rates, aggregate global policy remains stimulatory. Our broad exposure to global equities will be a way to benefit from this more synchronised growth. In the UK we expect something of a deceleration in growth, although a stimulative monetary policy will cushion any negative effects.

Against this backdrop we would expect the global environment for stock pickers to improve and underlying managers to find more sources of outperformance. For investment trusts, we would note that discounts to net asset value have narrowed which warrants some caution, but that in a favourable environment for equities these levels of valuation should not cause undue concern.

Katy Thorneycroft

Investment Manager 27th April 2017

MANAGED INCOME SHARE CLASS

INVESTMENT MANAGERS' REPORT

Dividend Review

Despite the positive headline level of total dividend growth from the UK stock market, this result was flattered by the impact of sterling's weakness on the dividends of some of the more internationally-oriented larger companies. Sterling weakened materially in the aftermath of the result of the EU referendum in June 2016 and this has had a positive impact on some of the more important sources of UK dividends: companies who declare their dividends in US dollars, such as the major oil stocks, and the major pharmaceuticals. However, 2016 was a year in which mining sector dividends halved (source: Capita Asset Services) as many of the mining stocks either abandoned or significantly reduced their dividend payments. The food retailers also cut their dividends.

Total UK dividends grew by 2.6% over 2016 (source: Capita Asset Services), although dividends would have fallen without the currency benefits from weaker sterling. It was another year of significant special dividends, which boosted the headline total. However, these special dividends have been less numerous in the current interim period to those that were declared in the first half of the last full financial year. To date, the portfolio has benefited from special dividends from Card Factory, Lloyds Banking Group, Taylor Wimpey and Beazley, although some of the insurers are not paying special dividends this year. The Company has £4.3 million of revenue reserves available to Managed Income shareholders to help smooth future dividend payments.

The outlook for UK dividend growth remains mixed, although further weakness in sterling would clearly be beneficial given the international revenues of the UK equity market, particularly for larger companies. Some companies will continue to generate sufficient cash to deliver good underlying dividend growth and/or special dividends.

Performance Review

The Managed Income portfolio outperformed its composite benchmark, delivering a total return of +8.1%, in comparison with the benchmark return of +7.0%.

For the first half of our financial year the overweight position in the most cost efficient iron ore producer, Rio Tinto, was a strong contributor to the portfolio's outperformance, as was the overweight position in Fever-Tree, the fast growing, premium mixer company that has consistently delivered strong results, ahead of market expectations. Other positive contributors included our overweight position in the electrical distributor, Electrocomponents, which performed very well as the company delivered strong results and saw further upgrades to its earnings prospects.

By contrast, not owning the mining groups, Glencore and the zero dividend paying Anglo American, detracted from performance as the mining sector rallied strongly over this six month period. Our holding in Novae, the specialist Lloyds insurance company, performed weakly on the back of large catastrophe losses and weak investment returns during 2016. Our long term overweight position in the premium dividend yielder, Imperial Brands, was also unhelpful over this period, but remains attractively valued with good dividend growth prospects. Overall, the portfolio outperformed the rising equity market over the first half of the financial year.

Portfolio Review

There has been no material change to the asset allocation of the portfolio during the half year. The portfolio remains overweight equities relative to its composite benchmark.

We assess individual investment opportunities on whether earnings estimates are being revised upwards, whether the valuation is attractive and whether the balance sheet and forecast cash flows allow for dividend growth. Portfolio construction is determined by stock selection with a focus on potential dividend growth.

Recently we bought a position in global food ingredients company, Tate & Lyle. The business has been performing well, leading management to increase their profits guidance for 2017. The outlook for profits growth over the next few years is encouraging whilst we expect dividends to grow by 4% over the next 12 months. We also bought Prudential Plc. The growth outlook is strong as its Asian business continues to expand and cash generation from its US operations remains impressive. We added Unilever to the portfolio following the rejected takeover offer from Kraft as we expect management to embark on a programme to improve returns. Other purchases were mostly concentrated on increasing our positions in existing holdings such as Rio Tinto and Card Factory.

We sold our holding in Informa. The revenue growth outlook in its key business divisions is challenging, leading to a deterioration in anticipated profit growth. We also sold our holding in outsourcing group Serco following a disappointing outlook for profitability in 2018 due to a high number of contracts subject to retendering. We reduced our positions in Booker, Direct Line and British American Tobacco.

Outlook

The UK stock market has remained healthy over recent months, with many corporates continuing to deliver good results and encouraging outlook statements. This is also the case globally, with the outlook for the corporate sector improving and growth expectations trending higher, as markets price in a gentle move towards global reflation. Although much of this improvement has been priced in with the strong rally in equity prices since early 2016, we believe that equities can still move higher albeit with more volatility likely. The outlook for UK dividend growth remains mixed, although any further weakness in sterling would clearly be beneficial given the international nature of the UK equity market, particularly amongst larger companies.

Political uncertainty is set to continue in 2017, with a number of important elections in Europe, uncertainty over the impact of Trump's policies on US economic and foreign policy, and domestically, the' Brexit' negotiations. The most recent announcement of a snap UK General Election on the 8th June 2017 merely adds to this uncertainty.

We will, of course, continue to seek out money making opportunities for the Company, with a particular focus on companies generating an attractive income return for their shareholders.

John Baker

Sarah Emly

Investment Managers 27th April 2017

MANAGED CASH SHARE CLASS

INVESTMENT MANAGER'S REPORT

It was once more a period of low returns for the Managed Cash portfolio. The Bank of England kept interest rates on hold at 0.25%, and retained the asset purchase programme at £435 billion. The UK government has now triggered Article 50 to formally start the process of exiting the EU. As the uncertainty around Brexit weighs on confidence, we see a risk of a period of weak data with inflation beginning to squeeze real incomes, and as a result a much reduced upward pressure on UK Gilt yields. We cannot rule out a marked rise in the public sector net borrowing requirement as a consequence of Brexit in the longer term, but it seems equally likely that the Bank of England will extend its quantitative easing programme if the data weakens significantly, in 2017. It is likely that softening economic data will ultimately dominate the outlook for UK yields.

The Managed Cash portfolio returned +0.2% for the period as interest rates remained low. The portfolio continues to retain its broad diversification across a range of the UK's leading AAA-rate sterling liquidity funds, each selected to provide a high level of capital security for shareholders.

The Bank of England is expected to keep interest rates on hold at its next meeting. While monetary policy is stimulative, the government's plans show fiscal policy pushing hard in the other direction during each of the next several years. We continue to expect a deceleration of UK growth in 2017.

Katy Thorneycroft

Investment Manager 27th April 2017

INTERIM MANAGEMENT REPORT

The Company is required to make the following disclosures in its interim report.

Principal Risks and Uncertainties

The principal risks and uncertainties faced by the Company fall into the following broad categories: investment strategy; market; accounting, legal and regulatory; corporate governance and shareholder relations; operational and financial. Information on each of these areas is given in the Business Review within the 2016 Annual Report and Accounts.

Related Party Transactions

During the half year to 28th February 2017, no new agreements were entered into with related parties which have materially affected the financial position or the performance of the Company.

Going Concern

The Directors believe, having considered the Company's investment objectives, risk management policies, capital management policies and procedures, nature of the portfolio and expenditure projections, that the Company has adequate resources, an appropriate financial structure and suitable management arrangements in place to continue in operational existence for the foreseeable future and, more specifically, that there are no material uncertainties pertaining to the Company that would prevent its ability to continue in such operational existence for at least 12 months from the date of the approval of this half yearly financial report. For these reasons, they consider there is reasonable evidence to adopt the going concern basis in preparing the financial statements.

Directors' Responsibilities

The Board of Directors confirms that, to the best of its knowledge:

(i) the condensed set of financial statements contained within the interim financial report has been prepared in accordance with FRS 104 'Interim Financial Reporting' and gives a true and fair view of the state of affairs of the Company and of the assets, liabilities, financial position and net return of the Company, as at 28th February 2017, as required by the UK Listing Authority Disclosure and Transparency Rules 4.2.4R; and

(ii) the interim report includes a fair review of the information required by 4.2.7R (important events that have occurred since inception, their impact on these financial statements and a description of the principal risks facing the Company) and 4.2.8R (related party transactions since inception that have materially affected the financial position or performance of the Company) of the UK Listing Authority Disclosure and Transparency Rules.

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;

• make judgements and accounting estimates that are reasonable and prudent;

• state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

• prepare the financial statements on the 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.

For and on behalf of the Board

Angus Macpherson

Chairman 27th April 2017

STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED 28TH FEBRUARY 2017

STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 28TH FEBRUARY 2017

1 This reserve forms the distributable reserve of the Company and may be used to fund distribution of profits to investors via dividend payments.

STATEMENT OF FINANCIAL POSITION

AT 28TH FEBRUARY 2017

NOTES TO THE FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 28TH FEBRUARY 2017

1. Financial statements

The information contained within the financial statements in this half year report has not been audited or reviewed by the Company's auditors.

The figures and financial information for the year ended 31st August 2016 are extracted from the latest published financial statements of the Company and do not constitute statutory accounts for that year. Those financial statements have been delivered to the Registrar of Companies and including the report of the auditors which was unqualified and did not contain a statement under either section 498(2) or 498(3) of the Companies Act 2006.

2. Accounting policies

The financial statements are prepared in accordance with the Companies Act 2006, United Kingdom Generally Accepted Accounting Practice ('UK GAAP'), including FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and 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 November 2014.

FRS 104, 'Interim Financial Reporting', issued by the Financial Reporting Council ('FRC') in March 2015 has been applied in preparing this condensed set of financial statements for the six months ended 28th February 2017.

The Company has elected not to prepare a statement of cash flows for the current period on the basis that substantially all of its investments are liquid and carried at market value.

All of the Company's operations are of a continuing nature.

The accounting policies applied to this condensed set of financial statements are consistent with those applied in the financial statements for the year ended 31st August 2016.

3. Dividends

1 All the dividends paid and declared in the period have been funded from the Revenue Reserve.

2 In accordance with the accounting policy of the Company, these dividends will be reflected in the financial statements of the following period.

4. Return per share

5. Net asset value per share

The net asset values per share are calculated as follows:

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

JPMORGAN FUNDS LIMITED

ENDS

A copy of the half year report will be submitted to the National Storage Mechanism and will be available shortly for inspection at www.morningstar.co.uk/uk/NSM

The half year report will also be available shortly on the Company's website at www.jpmelect.co.uk where up to date information on the Company, including daily NAV and share prices, factsheets and portfolio information can also be found.