REG - Nippon Active Value - Annual Financial Report
08/04/2026 07:00
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RNS Number : 5316Z Nippon Active Value Fund PLC 08 April 2026
Nippon Active Value Fund plc
Annual Report and Accounts
For the year ended 31 December 2025
Investment Objective, Financial Information and Performance Summary
Investment Objective
The investment objective of Nippon Active Value Fund plc (the "Company" or
"NAVF" or "the Fund") is to provide Shareholders with attractive long-term
capital growth primarily through the active management of a focused portfolio
of quoted companies that have the majority of their operations in, or revenue
derived from, Japan, or a majority of whose consolidated net assets are held
in Japan, or that are included in the TOPIX, and that have been identified by
the Investment Adviser as being undervalued.
Financial Information
At At
31 December 31 December
2025 2024
Net assets - (£'millions) 430.6 365.4
Net asset value ("NAV") per Ordinary Share ("Share") - (pence)(1) 223.7 193.2
Share price - (pence) 207.0 187.5
Share price discount to NAV (%)(2) (7.5) (3.0)
Ongoing charges (%)(2) 1.12 1.18
Performance Summary
For the year ended For the year ended
31 December 31 December
2025 2024
(%) (%)
NAV total return per Share(2,3) +17.4 +15.2
Share price total return per Share(2,3) +12.3 +16.8
MSCI Japan Small Cap index(3) +19.8 +6.8
Source: Bloomberg
1 This is measured on a cum income basis.
2 These are Alternative Performance Measures ("APMs"), which is a
financial measure of historic or future financial performance, financial
position, or cash other than a financial measure defined or specified in the
applicable financial reporting framework. Definition of these and other APMs
used in this report, together with how these APMs have been calculated are
disclosed in the annual report.
3 Total returns are stated in GBP, including dividends reinvested.
Chairman's Statement
Overview of the Year
I am pleased to present the sixth annual report of Nippon Active Value Fund
plc, covering the period from 1 January to 31 December 2025.
At the end of the year, net assets were £430.6 million and the net asset
value ("NAV") per share was 223.7p, a rise of +17.4% over the year and a
cumulative increase of +139.7% since the Company's launch on 21 February 2020.
While we do not target a particular index benchmark, for comparison the MSCI
Japan Small Cap Index returned +19.8% in sterling terms over the year and
+46.1% since the launch date. All returns assume dividends were reinvested.
Over five-years the Company's annualised return is 16.1% in sterling terms; in
JPY terms the annualised return is 25.8%, reflecting how Yen weakness has
detracted from the strong underlying performance of the Company.
The closing share price on 31 December 2025 was 207.0p. The share price rose
by +12.3% in 2025 and +118.2% since inception. At the end of December, the
shares traded a discount to NAV of -7.5%. The average discount to NAV over the
year was 3.4% and the shares traded in a range of a premium of 1.8% to a
discount of -10.1%, with times of periodic enlarged discounts generally
reflecting increased macro uncertainty, most notably in 2025 associated with
tariffs and Takaichi's political leadership selection. During the year the
Company issued 3,373,282 shares, at a premium to the prevailing NAV, to
satisfy investor demand, raising net proceeds of £7.2 million.
The first half of 2025 was dominated by news flow regarding US tariff rates,
but by the second half of the year investors seemed satisfied that the
economic impact would be manageable and markets resumed their uptrend. The
focus was on stocks with an involvement in Artificial Intelligence ("AI") and
those that would benefit from increased fiscal expenditure, in particular from
higher defence spending to meet US demands for its allies to make a greater
contribution to global defence needs. The Bank of Japan raised the benchmark
interest rate to 0.5%, in early January 2025 and by a further 0.25% in
mid-December. The yen weakened marginally against sterling in 2025, though was
less of a drag on performance than in earlier years.
The large cap Japanese indices, TOPIX and the Nikkei 225, rose by +17% and
+20.6% respectively in 2025, reaching a historic high after the appointment of
Sanae Takaichi as head of the ruling Liberal Democratic Party ("LDP") (the
senior party in the coalition government) in October. Her early ratings were
strong, and she called a snap election in early February 2026, in which she
won a decisive majority for the LDP. Greater political stability should
provide a supportive background for equities. More recently, the developments
in the Middle East have understandably unsettled markets. At the time of
writing, it is still too early to assess precisely the longer-term impact of
the hostilities. We all hope for a quick resolution to protect the lives and
livelihoods of those who are immediately affected. Japan, as a major importer
of oil, is particularly exposed to moves in the global price of crude oil and
gas. This strategy does not seek to reflect the prospects for the Japanese
economy as a whole or to track the performance of the broad Japanese stock
market. Heightened volatility can also produce opportunities to add to high
conviction positions at more attractive valuations. Our Investment Adviser
will adjust their investment thesis where changes in underlying fundamental
necessitate, and their trading will continue to reflect long term prospects,
rather than respond to short term sentiment.
NAVF NAV Cumulative Performance: 139.7%
NAVF Share Price Cumulative Performance: 122.6%
MSCI Japan Cumulative Performance: 58.3%
MSCI Japan Small Cap Cumulative Performance: 43.9%
Our Investment Approach
Our Investment Adviser, Rising Sun Management ("RSM"), with its presence on
the ground in Tokyo and with the assistance from its affiliate Dalton KK,
continues to identify potential targets and maintains the coverage of
portfolio holdings.
As an activist manager RSM is not seeking to reflect the market as a whole or
the fundamentals of the broad Japanese economy. Instead, our Company's
strategy is to invest in a concentrated portfolio of undervalued companies
with fundamentally strong business models. Our Investment Adviser identifies
areas in which to engage with management to improve shareholder returns,
particularly around balance sheet management and capital allocation. In order
to have some weight with management they need to build a significant stake,
and as a result, the portfolio holdings tend to be in small- to
medium-capitalised stocks. We have memoranda of understanding with other funds
advised by RSM and Dalton Investments with whom we co-invest in opportunities
to achieve greater scale, where NAVF as a sole investor would not be able to
build a sufficiently meaningful holding. At the end of 2025, the Company held
27 investments, of which 26 were also owned by NAVF Select LLC and 15 by other
clients of Dalton Investments.
Most of RSM's engagement with our target companies is through letters and
private meetings, though formal proposals are made at annual general meetings
when appropriate, and occasionally, RSM may choose to publicise our
engagement. The public letters are available on the Company's website
(www.nipponactivevaluefund.com (http://www.nipponactivevaluefund.com) ) and
are flagged on our LinkedIn page
(www.linkedin.com/company/nippon-active-value-fund/
(http://www.linkedin.com/company/nippon-active-value-fund/) ). We encourage
all our shareholders to view these sites for details on campaigns and other
insights.
Japanese Corporate Governance Developments
Our choice of strategy at the launch of the Company was designed to capitalise
on developments in Japanese corporate governance that have gained pace since
the launch of the Corporate Governance Code in 2015.
The regulatory environment continues to provide a supportive background for
activist investors. Prime Minister Takaichi is a protégé of former Prime
Minister Abe, whose 'three arrows' of policy included corporate governance
reforms. To date she has not given a commitment to further this agenda and
while she may call for greater attention to be given to employee stakeholders,
commentators do not expect her to reverse the considerable progress made in
corporate governance practices over the past few years.
In previous reports, we have discussed the importance of the Japan Exchange
Group ("JPX") request, issued in March 2023, that listed companies have a
greater focus on measures to improve mid- to long-term profitability and
corporate value. In their review of 2025, JPX highlighted the progress made in
corporate disclosures of their strategy for improving profitability.
Disclosure is voluntary, but over 90% of companies listed on the Prime Market
and over 50% of companies in the Standard Market have complied. JPX is now
emphasising the content and quality of the reports. JPX has published 55 named
examples of companies whose disclosures are considered 'best practice' as well
as some anonymous examples of inadequate disclosures.
The basic message in the 2025 review is unchanged: for the Japanese equity
market to be attractive to international investors, and remunerative for all
stakeholders, listed companies need to show they have a viable business model
and are making efficient use of their capital. Unproductive reserves of cash
and securities should be reinvested in profitable business areas or returned
to shareholders. This year's report stresses the need to implement long-term
strategies to support growth, rather than merely responding to requests to
improve shareholder returns with a one-off share buyback or increased
dividend. There is more emphasis given to the importance of investing in
growth opportunities, intellectual property and in human capital, as well as
in physical assets and research and development. In other words, employees
should benefit from improved returns on capital as well as shareholders. As
our Investment Adviser says in their report below, we agree a sustainable
business needs to recruit and retain a talented workforce.
Japan's working age population is declining. Small and mid-cap companies often
have limited human resources and difficulties establishing management
succession. For them, a thorough redirection of corporate strategy can be best
achieved through strategic discussions with external parties. In June 2025,
the Ministry of Economy, Trade and Industry ("METI") released the first
standardised Limited Partnership Agreement in English. This LPA is aligned
with global practices, whereas previous models were translations of the
Japanese versions. This should facilitate greater involvement from global
private equity companies. Indeed, by September 2025 Private Equity firms had
announced 38 deals, valued at $81 billion, compared to a total for the whole
of 2024 of $19.9 billion. In 2025, more than 7% of listed companies received a
takeover bid. Ten years ago the equivalent was below 2%.
Share liquidity has been another area of focus for JPX since 2024, especially
through long-term cross-shareholdings and parent-subsidiary listings. JPX has
identified two issues: inefficient capital allocation and inadequate
protection of minority shareholders in corporate actions. Last year they
announced that they would adjust market capitalisation to remove strategic
cross-shareholdings but allowed companies to reclassify holdings from
'strategic shareholding' to 'pure investment.' In April 2025, they amended the
guidelines to mandate additional disclosure in order to limit tactical
re-categorisation. Our Investment Adviser welcomes the trend to unwind
long-term cross-shareholdings, which they expect will improve market
liquidity.
Regulatory developments continue to be positive for activist investors. In
practice, updated guidelines are not always followed. In June 2025, Toyota
Motor announced a takeover bid for another group company, Toyota Industries
("Tico"), which would be delisted if the takeover bid ("TOB") succeeds. The
takeover price valued assets at book value, a significant discount to their
market value. In January 2026, the takeover price was increased but still
fails to reflect the market value of Tico's assets. Foreign shareholders have
forcibly expressed their objections, and we hope that the coverage of the
'take-under' supports initiatives from JPX and the FSA for independent
oversight of management buy-outs ("MBOs") and TOBs and greater protection of
minority shareholders.
Our Investment Adviser's report, which follows, includes more details of the
investment approach and highlights some of the key contributors to performance
in 2025 as well as examples of engagement over the year.
Dividend
The Company's objective is to achieve its returns primarily through capital
appreciation. In February 2026, the Company held a General Meeting where
shareholders approved the cancellation of the share premium account, which is
common for investment trusts. The Board does not plan to introduce a formal
annual dividend target, but this does allow us greater flexibility in
determining dividend levels in any given year. Distributions will continue to
be made entirely at the discretion of the Board, taking into consideration the
requirement to ensure the Company's compliance with the rules relating to
investment trusts.
The Board is pleased to recommend a final dividend of 5.52p per share (2024:
3.25p), equivalent to approximately 2.5% of the Company's total NAV as at 31
December 2025. Subject to shareholder approval at the Annual General Meeting
on 4 June 2026, the dividend is expected to be payable on 16 July 2026 to
shareholders on the register at the close of business on 19 June 2026, with an
ex-dividend date of 18 June 2026.
Gearing
The Company has a borrowing facility with Northern Trust of £70 million to
provide the Company with flexibility to gear the portfolio if required to
facilitate corporate actions. The Company drew down £5 million in March 2025,
which had been repaid by early July. At the end of December 2025, the facility
had not been drawn down and the portfolio held £9,947,000 (2024:
£19,889,000) in cash. As at 2 April 2026, cash comprised 15.0% of NAVF's net
assets.
Unlisted Holdings
At year-end the Company held two positions in unlisted equities: T&K Toka
and Trancom, both of which were delisted following take-over bids. At the end
of the year, the combined value of these holdings was £7.1m. The Board,
together with other Dalton Inc clients, engaged a Tokyo-based firm, Competant
Inc., to provide quarterly valuations of the unlisted portfolio. The
appointment process was led by the Tokyo-based teams at Dalton KK and RSM,
acting on behalf of the Company and the Dalton related parties who are also
invested in the two respective partnerships through which these entities are
held, with oversight and input from the Board.
Annual General Meeting ("AGM")
The Board of Directors of the Company value our shareholders and thank you for
your continued support, and we welcome you to attend our AGM to be held at
Prince Philip House, 3 Carlton House Terrace, London, SW1Y 5AG on Thursday 4
June 2026 at 12:30 p.m. The event will feature an investor presentation by
Paul ffolkes Davis and Gifford Combs of RSM, our Investment Adviser, and
provide an opportunity to meet the Board of Directors informally thereafter.
As part of the Board's commitment to corporate governance best practice and
succession planning, and in line with the Board's intention to reduce the
number of Directors back to a maximum of five, Claire Boyle will step down
from the Board at the AGM, returning the number of Directors to five. The
Board would like to thank Claire for her valuable contribution and service.
The Board strongly encourages all shareholders to exercise their votes by
completing their proxy forms. Please note that the deadline set by retail
platforms and Proxy providers may be several days before the meeting. Detailed
instruction on "How to Exercise Your Vote" and "How to Complete a Form of
Proxy" can be found in the annual report.
Those shareholders who are unable to attend the AGM in person are welcome to
submit questions for the Board or their Investment Adviser either in writing
to the Company Secretary at the registered office, 46-48 James Street, London,
England, United Kingdom, W1U 1EZ, or by emailing navf@nsm.group
(mailto:navf@nsm.group) .
The Notice convening the AGM is set out at the end of this document.
Outlook
The Company seeks to continue to take advantage of the corporate governance
reforms in Japan introduced over the past decade, through active engagement
with portfolio companies. We were very pleased to have received recognition in
the form of three industry awards last year: the Best Performance - Japan
category at the Citywire Investment Trust Awards 2025, the Investors' Choice
Investment Trust Award, and the Overseas Smaller Companies category at the
Investment Week 2025 Investment Company of the Year Awards.
While past performance does not guarantee future returns, we believe these
awards recognise the validity of NAVF's investment thesis and the ability of
our Investment Adviser to implement the strategy.
We have a concentrated portfolio of undervalued opportunities where there is
potential to unlock value for all shareholders. Returns tend not to be closely
correlated with the overall market, but rather depend on the outcome of our
engagement with our target investments. As you will read in the Investment
Advisor's report below, there remain plenty of new ideas and as the Company
increases in size the opportunity set also increases.
Rosemary Morgan
Chairman
7 April 2026
Investment Adviser's Report
Performance since Initial Listing(1)
Periodic change Cumulative change
JPY GBP JPY GBP
Period (%) (%) (%) (%)
21 February 2020 to 31 December 2020 10.6 13.6 10.6 13.6
Year Ended December 2021 35.0 22.3 49.3 38.9
Year Ended December 2022 5.3 3.4 57.2 43.7
Year Ended December 2023 39.6 23.1 119.5 76.9
Year Ended December 2024 26.3 15.2 177.2 103.8
Year Ended December 2025 26.0 17.4 249.1 139.7
CAGR(2) Since Inception 21 February 2020 to 31 December 2025 23.5 15.9 249.1 139.7
1 Investment results assume dividends are reinvested.
2 Compound Annual Growth Rate
Introduction
This report provides an overview of key events and themes affecting your
Company in 2025. I will address individual holdings to reflect where they have
generated the alpha in our returns or detracted from performance. The driver
of success in this Company is not to buy the cheapest or most undervalued
stocks (though it helps), it is to identify businesses where our hands-on
engagement can bring about the greatest change in management practices in
order to realise value for shareholders. We like decent companies that have
too many non-operational assets, whether cash, cross-shareholdings or
property, on the balance sheet. Even if these characteristics reflect poor
capital allocation, thus making them worthy of our attention, they also
provide comfortable margins of safety, which protect the portfolio until we
can make something happen to unlock value. In addition, we look for open share
registers, a lack of third-party brokerage research (especially a lack of
English reporting), and demonstrable under-valuation of a type likely to
attract the attention of the regulators who are seeking to address the capital
misallocation of listed companies. This last is most important: we never
forget that the largest shareholder across all Japanese stock exchanges, still
owning 11-12% of the markets, is the combination of the Bank of Japan and the
state pension fund, in other words, Japan Inc. When Prime Minister Shinzo Abe
began the corporate governance reform programme in 2014, he did so out of a
position of being the largest investor in a long-underperforming stock market
- one could argue his government was motivated by self-interest.
Twelve years later, the reform programme has broadened under an umbrella of
guidelines, directions and suggestions issued by all the financial offices of
state including METI, the JPX, and the FSA. The requirement to understand and
embrace modern valuation metrics, as well as more efficient capital allocation
methodologies, has taken on a philosophical dimension; however uncomfortable,
corporate managements have understood the need for change. They may not like
it, but those who continue to resist are finding themselves increasingly
isolated. The debate about encouraging small companies to trade at or above
book value, or whether they should exist as listed companies at all, continues
to rage. As I wrote last year, this makes sense; the US economy is six times
larger than Japan's, and yet the JPX has more listed companies than any other
exchange in the developed world. Large-scale consolidation and de-listing are
inevitable, despite any inertia of individual salaryman-run companies that
have slumbered for thirty years during Japan's deflationary slump. The FSA
told us recently they expect the current total of around 4,000 listed
companies to be half that number in ten years. We do not think it will take
that long. Inflation is back and the current prime minister's expansionist
policies are only likely to stoke it further. There has been some concern that
Takaichi's promotion of better pay for workers is a move away from recent
investor-friendly legislation. On the contrary, we have always advocated
increasing both remuneration and share ownership amongst employees, and there
is no indication that the direction of regulatory travel will change. The
drive for capital efficiency and shareholder recognition is undiminished. NAVF
is not running out of road, indeed it has increasing opportunity.
Nevertheless, it is still long and there remain copious quantities of
slow-moving, even broken down, vehicles that need to be hauled over onto the
hard shoulder, where roadside assistance in the form of the increasing army of
activists, private equity players and financial advisers generally, can either
turbo charge them or take them away on the flatbed of privatisation. We have
several long-running engagements we expect to find resolution to soon,
starting with the already completed tender offer for Hogy Medical. This
process will replenish our coffers and provide us with ammunition to direct at
our next targets, many of which are already identified.
Performance
In 2025, Japanese equity markets achieved a third consecutive year of strong
growth. In local currency terms (JPY), the Nikkei 225 rose 26% to close above
50,000 for the first time, while the TOPIX increased 22% to record highs. This
performance was driven by AI-related demand, ongoing corporate governance
reforms, and expectations of fiscal stimulus under Prime Minister Sanae
Takaichi. Over the same period the MSCI Japan was only 12.6% better (JPY),
while the MSCI Japan Small Cap index was up almost 29%. Happily, in such an
exceptional year for the main indices, NAVF kept up, with NAV (as measured in
Yen and assuming all dividends are reinvested) being just over 26% to the
better or up 17.4% when measured in sterling.
Since Takaichi's appointment as PM and the consequent fear of her fiscal
stimulus weakening the Yen, the currency has, again, cost us considerable
performance. Since inception, our cumulative performance, when measured in
Yen, is almost 250%. In sterling terms, we have gained 140%.
NAVF (GBP) Cumulative Performance: +139.7%
NAVF (JPY) Cumulative Performance: +249.1%
JPY/GBP Cumulative Performance: -31.5%
Market Cap (USD) 31/12/2023 to 31/12/2025
31/12/2023 31/12/2024 31/12/2025
Portfolio Ending Portfolio Ending Portfolio Ending
Weight Weight Weight
(%) (%) (%)
Total 100.0 100.0 100.0
> $2.5bn 13.9 0.0 8.9
$1bn - $2.5bn 10.0 6.0 3.7
$750m - $1bn 5.9 7.6 19.7
$500m - $750m 12.2 11.9 30.6
$250m - $500m 42.7 59.6 25.9
< $250m 5.2 9.0 6.8
Cash 7.6 5.5 2.6
N/A 2.5 0.4 1.9
Global Industry Classification Standard ("GICS+") Sector
31/12/2023 31/12/2024 31/12/2025
Portfolio Ending Portfolio Ending Portfolio Ending
Weight Weight Weight
(%) (%) (%)
Total 100.0 100.0 100.0
Communication Services 5.9 8.1 9.8
Consumer Discretionary 9.8 6.5 10.0
Consumer Staples 4.3 0.0 3.6
Energy 0.0 0.0 0.0
Financials 3.1 0.0 0.0
Health Care 12.9 28.9 28.1
Industrials 34.9 39.2 34.1
Information Technology 6.3 1.9 1.6
Materials 15.2 9.5 8.3
Real Estate 0.0 0.0 0.0
Utilities 0.0 0.0 0.0
Cash 7.6 5.5 2.6
Unassigned 0.0 0.4 1.9
Attribution
During the year, the top five contributors to the portfolio, making the
largest gains both realised and unrealised, were as follows:
Portfolio Portfolio Portfolio
Average Total Return Contribution To
Ticker Weight (%) (%) Return (%)
Total 100.0 +19.5 +19.5
4676 Fuji Media Holdings, Inc. +9.1 +101.9 +7.0
3593 Hogy Medical Co., Ltd. +11.8 +32.9 +3.3
3302 Teikoku Sen-I Co., Ltd. +5.2 +32.1 +1.6
1976 Meisei Industrial Co., Ltd. +7.3 +14.1 +1.4
9357 Meiko Trans Co., Ltd. +3.0 +29.8 +0.9
The poorest performers were:
4212 Sekisui Jushi Corporation 3.9 -3.3 -0.2
4886 ASKA Pharmaceutical Holdings 6.8 -7.3 -0.2
4109 Stella Chemifa Corporation 2.9 -3.6 -0.2
4956 Konishi Co., Ltd. 0.4 -2.2 -0.1
8291 Nissan Tokyo Sales Holdings Co. 1.4 -6.1 -0.1
Contributors
Fuji Media Holdings
Fuji Media Holdings ("FMH") shares rose more than 100% in 2025 after the
company underwent a complete overhaul of its management following a sexual
abuse scandal. The scandal led to the identification of a broader management
and governance issue, in which an independent third-party report found that
Hieda-san, an ex-board member of FMH, operated above the FMH board, making key
personnel decisions, including those of the Chairman and President. Throughout
the first half of 2025, we made multiple public engagements against FMH, which
were supported by broader Japanese society in response to its own #MeToo
movement. Our engagement efforts culminated in our nomination of 12 external
directors. We lost in the AGM; however, we left a positive impact as agents of
change at FMH and broader Japanese society. On 3rd February 2026, the company
agreed to our, and fellow activists', demands to raise its dividend and start
to tackle its dysfunctional structure by examining how to introduce external
capital into the real estate business. More importantly, it announced the
intention to buy back Y235 billion, or around 30% of outstanding shares. This
was carried out via the Tostnet 3 mechanism the following day at Y3,839 per
share. The amount was carefully calibrated and allowed for NAVF/Dalton, and
other activist critics, to exit. FMH may well celebrate having rid itself of
its chief tormentors at a stroke, and, indeed, we welcome the approximately
150% profit earned on our investment, but we are concerned that this may prove
only a pyrrhic victory. If the stock weakens significantly (and it has already
started to), there is nothing to stop us, or others, buying back in, and
starting the process all over again.
Hogy Medical
Hogy Medical shares rose +32% over the year, following a strong rally after
Carlyle launched a tender offer bid ("TOB") to take the company private. On 20
June 2025, Jamie Rosenwald, Dalton and Rising Sun Management Chief Investment
Officer, was elected to the board at the AGM, with a 52.1% vote in favour.
According to public documents, the company held multiple discussions with
management from 4 March 2025 and presented a go-private proposal on 21 April
2025. Nomura was elected as financial advisor in July 2025. The company held
an auction on 29 August 2025, to which Carlyle and a few others were invited
as final bidders. The company's management and the special committee decided
that Carlyle was the most appropriate partner, given its global network of
management resources and expertise to help the company strengthen its position
as a solution provider in the Japanese medical field. The TOB launched on 17
December 2025, with NAVF's agreement to tender our shares. NAVF has agreed
with the Offering Vehicle that it will reinvest an amount of the tender offer
proceeds in a limited partnership to be formed by Carlyle following the
transaction closing in Q1 2026; the reinvestment will still leave NAVF well
within the Company's unlisted investments limit of 10% of NAV.
Teikoku Sen-I
Teikoku Sen-I rallied by 32.9% in 2025, driven by thematic investments in
defence under the Takaichi government. Teikoku Sen-I provides nuclear-related
equipment, national security equipment for airports, and military linen.
Teikoku Sen-I is a partial owner of its own building, which creates some
margin of safety. Earnings improved throughout the year, with the company
expecting to achieve an operating profit of Y4.8bn, an improvement from the
FY25/3 operating profit of Y3.5bn.
Meisei Industrial
Meisei Industrial rallied modestly by 14.1%. The company provides maintenance
services around large chemical plants and refinery facilities and has
alternating peak and trough years as its clients undergo a CapEx cycle every
couple of years. FY26/3 is a trough year. We also expect the company to
benefit from nuclear restarts in the coming years, as the electricity shortage
arising from AI-driven demand becomes more prevalent.
Meiko Transport
Meiko Transport rallied +29% as the company's shares continued a modest climb.
The company remains cheap, trading below EV/EBITDA of 5x and sub 1x Price to
Book ("PBR"). In May 2025, the company announced its mid-term plan to a) spend
growth CapEx of Y30bn and b) improve return to shareholders through dividends
and share repurchase programs. The company also intends to continue reducing
cross-shareholdings as well as borrowing Y12bn to fund future growth and
shareholder returns.
Detractors
Sekisui Jushi
Sekisui Jushi specialises in plastic and resin-based products used in road
infrastructure and urban development. The company under-performed, returning
-3% in 2025, significantly lagging the index. The company continues to
struggle since the purchase of the European subsidiary, WEMAS Group. However,
it maintains strong cash flows that accumulate on the balance sheet over time,
and we believe that the company is becoming increasingly attractive. Since the
acquisition of the WEMAS Group, we believe that the company remains a good
engagement target with a high-quality business.
Aska Pharmaceutical
Aska Pharmaceutical's operating performance has remained solid, with its core
products delivering steady growth and no material deterioration in underlying
fundamentals. Key franchises such as Relumina, Thyradin, and Rifxima continue
to perform well, supported by strong competitive positions - particularly
Thyradin and Rifxima, which benefit from near-monopoly market structures and
serve as stable earnings pillars. While some products face medium-term
competitive risks, these are more than offset by the prospective upside from
pipeline assets such as AKP-022, leaving the overall business trajectory
firmly positive.
Against this backdrop, the company's share price total return declined by 7.3%
over the period, making Aska one of the weaker contributors to portfolio
returns. We believe this underperformance was driven by market reaction to the
introduction of a poison pill rather than a reflection of weak operating
results. Despite sound earnings momentum, the adoption of a defensive takeover
measure was perceived negatively by the market, weighing on investor sentiment
and valuation. Our engagement to bring about change at the company is both
long-standing and ongoing.
Stella Chemifa
Stella Chemifa, a leading supplier of high-purity hydrofluoric acid for the
semiconductor industry, delivered a total return of -3.5% during the period,
contributing -0.2% to portfolio performance. Stella Chemifa's recent results
showed an improvement in profitability, as the company raised selling prices
by more than the increase in raw material costs, leading to higher profit
margins. In its main semiconductor-related business, AI-related demand was
strong, but other areas, such as power semiconductors, remained weak,
resulting in only a modest increase in semiconductor-related sales. In the
nuclear power segment, sales to China are declining; however, the company
expects future expansion opportunities in Europe, even though it may take a
while. The company's share price declined slightly in 2025, influenced not
only by its operational performance but also by overall sentiment toward the
semiconductor sector. Since entering 2026, however, the share price has been
rising, supported by strong performance among the company's key customers,
particularly semiconductor memory manufacturers. The company's competitive
advantage, supported by its largest global market share in high-purity
hydrofluoric acid for semiconductors, has not changed.
Konishi
Konishi, which is engaged in the manufacturing of adhesives as well as
infrastructure construction such as repairing bridges, recorded weak share
price performance in CY2025, as the company expects flat operating profit for
FY3/26, mainly due to higher depreciation stemming from upfront investments.
However, the company, having generated an average ROIC of approximately 13%
over the past decade, is expected to remain a beneficiary of rising demand for
maintaining domestic infrastructure, such as bridges. Forecasts indicate that
approximately 55% of bridges in Japan will be at least 50 years old by 2030.
It is also worth noting that the company has bought back an average of 6% of
its outstanding shares over the past three years, steadily increasing its book
value per share. With net cash equivalent to approximately one-third of its
market capitalisation, the company trades at book value and 4.2x EV/EBITDA.
Hence, our investment thesis remains intact.
Nissan Tokyo Sales Holdings
Nissan Tokyo Sales Holdings returned -6.1%, significantly underperforming the
index. We believe the company remains extremely attractive as it trades at a
sub-3x EV/EBITDA ratio and has a negative enterprise value if we consider the
value of the real estate. In addition, we believe that the company is led by
strong management, which is focused on its business and its customers,
although we feel that the shareholders have been somewhat neglected in the
process. We will continue to focus on the company.
Portfolio engagement in 2025
Throughout the year, NAVF, in conjunction with its affiliates NAVF Select and
Dalton Investments, continued engaging with companies where the consortium or
'concert party' holds significant stakes. The most notable success came right
at the end of the period when, on 17 December 2025, Hogy Medical announced
that the company would be taken private in a tender offer organised by Carlyle
at JPY6,700 per share. This is the successful culmination of the concert
party's longstanding dialogue with management recommending they pursue this
path. The process was accelerated in June 2025 with the election of James
Rosenwald III, our CIO, as an external member of the board. NAVF, along with
its affiliates, have the opportunity to continue our support for the company
by taking a stake in the new unlisted entity, as we have with two previous
MBOs. Thus, we have achieved a profitable exit, set up the prospect of further
returns when the company is sold or re-listed, while simultaneously freeing up
substantial capital for reinvestment in our next targets. The transaction
successfully closed in March 2026.
Outlook
The success with Hogy Medical demonstrates the fruits of our labour. Elsewhere
our engagement continues, most obviously with Aska Pharmaceutical, Eiken
Chemical, Bunka Shutter and Stella Chemifa. The concert party owns over 20% of
the outstanding shares, and in Eiken's case it is approaching 33%. Although
several of these are threatening poison pills, we do not believe the status
quo can be sustainably maintained given the winds of change across the
Japanese equity market. Numerous other activists are leading interesting and
sometimes overlapping initiatives, and the regulatory overhaul juggernaut
ploughs on, applying ever greater pressure for corporate reform - the
prospects for 2026 look positive.
Since the early drafts of this report were prepared, events in the Middle East
and the resulting share rise in oil prices have understandably weighed on
market sentiment. While the portfolio is not immune to periods of heightened
volatility, we believe its focus on undervalued companies provides a degree of
downside protection. Our analysts continue to identify attractive
opportunities to deploy capital and will adjust their assumptions in corporate
fundamentals to reflect any sustained impact from the conflict.
Paul ffolkes Davis
Rising Sun Management Limited
7 April 2026
Portfolio
As at 31 December 2025
Top ten holdings as a percentage of net assets
Percentage
of net assets
Company Sector (%)
1. Hogy Medical Co Ltd Health Care 14.2
2. Fuji Media Holdings Inc Communication Services 8.9
3. Eiken Chemical Co Ltd Health Care 8.7
4. Meisei Industrial Co Ltd Industrials 7.7
5. Bunka Shutter Co Ltd Industrials 5.6
6. Murakami Corp Consumer Discretionary 5.5
7. Teikoku Sen-I Co Ltd Industrials 5.4
8. ASKA Pharmaceutical Holdings Co Ltd Health Care 5.4
9. Ebara Jitsugyo Co Ltd Industrials 4.3
10. Ezaki Glico Co Ltd Ord Consumer Staples 3.7
Sector breakdown
Portfolio Characteristics
Equity Investments 97.6%
Price/Book 1.3x
EV/EBITDA 9.3x
Adjusted Cash/Market Cap* 28.4%
Net Working Capital/Market Cap** 36.1%
* Adjusted Cash / Market Cap = (Cash + Cross Shareholdings - Debt)
/ Market Cap
** Net Working Capital / Market Cap = (Cross Shareholdings + Total
Current Assets -Total Liabilities) / Market Cap
Investment Policy, Results and Other Information
The Company's investment objective and investment policy (including defined
terms) are as set out in its prospectus dated 1 September 2023.
Investment objective
The investment objective of the Company is to provide Shareholders with
attractive long-term capital growth primarily through the active management of
a focused portfolio of quoted companies that have the majority of their
operations in, or revenue derived from, Japan, or a majority of whose
consolidated net assets are held in Japan, or that are included in the TOPIX,
and that have been identified by the Investment Adviser as being undervalued.
Amendments to the Investment policy during the year
· A minor inconsistency was identified during the year between the
Company's Investment Policy and its Investment Restrictions. Following legal
review, the Board approved a small amendment to align the position and remove
the contradiction. This amendment did not alter the Company's investment
approach and did not require regulatory or shareholder approval, it simply
ensured that the stated investment policy accurately reflects the Investment
Restrictions already in place.
Further, a Board meeting of the Company was held whereby a further amendment
to the investment policy of the Company was approved by the Company's Board of
Directors. This amendment was also considered to be a non‑material change,
and the Company was advised by its Broker and Legal Advisers that the
amendment did not require FCA and shareholder approval. The amendment was
announced to the market on 19 January 2026:
· No more than 10 per cent. in aggregate of the value of the total
assets of the Company may be invested in other listed closed-ended investment
funds, except for those which themselves have stated investment strategies to
invest no more than 15 per cent. of their gross assets in other closed-ended
investment funds which are on the Official List.
· Additionally, the Company will itself not invest more than 10% of
its gross assets in other investment companies or investment trusts which are
listed on the Official List. This additional restriction is considered to be a
non-material change to the Company's investment policy. The full investment
policy, including changes are outlined below.
Investment policy
Asset allocation
The Company will primarily invest in a highly selective portfolio of shares
issued by quoted companies that have the majority of their operations in, or
revenue derived from Japan or a majority of whose consolidated net assets are
held in Japan, or that are included in the TOPIX ("Japanese Shares"), and
which the Investment Adviser deems attractive and undervalued and typically
where (i) cash and other liquid investments, real estate and/or tradeable
securities constitutes a significant proportion of the investee company's
market capitalisation; and (ii) the relevant company has no controlling or
majority shareholders.
The Company may also from time to time obtain exposure to Japanese Shares,
Derivatives (as defined below), cash, cash equivalents, exchange traded funds,
near cash instruments and money market instruments, which may not necessarily
suit activist management by the Investment Adviser, though this will be
opportunistic, including as part of an acquisition of a broader portfolio, and
will not form a core focus for asset allocation on an ongoing basis.
There are no restrictions placed on the market capitalisation of investee
companies; but it is expected that the portfolio will be weighted towards
small-cap and mid-cap companies with market capitalisation of up to US$3
billion. The portfolio is expected to have up to 35 holdings, although there
is no guarantee that this will be the case, and it may contain a lesser or
greater number of holdings at any time.
The Company intends to acquire meaningful minority stakes in each investee
company. The Company will not, however, acquire any stake which could cause a
change in its status as an investment trust under Chapter 4 of Part 24 of the
Corporation Tax Act 2010.
Apart from the investment restrictions set out below, the Board will not set
any limits on sector weightings or stock selection within the portfolio. The
Company will not be constrained by any index benchmark in its asset
allocation.
The Company may use derivatives for efficient portfolio management purposes.
Such purposes would include the management of cash received by the Company
upon the occurrence of significant liquidity events (including, without
limitation, the receipt of proceeds of fundraisings, the realisation of
Portfolio assets and other cash-generative events such as the completion of a
management buyout by an investee company). Such derivative contracts may, for
example, give the Company exposure to the whole or a sub-section of the
Japanese stock market until such time as the Investment Adviser determines
that the Company's derivative position should be liquidated and invested in an
investee company in accordance with the Investment Policy (the foregoing
derivative contracts being, for the purposes of this Investment Policy
"Derivatives").
Additionally, while the Company intends that the majority of its investments
will be in quoted companies, it may also make investments in unquoted
companies and the Company may become invested in unquoted companies as a
result of corporate actions or commercial transactions undertaken by quoted
companies. The Company will only make investments in unquoted companies in
order to maintain or improve its position in relation to a business which
operated through a quoted entity at the time of the Company's initial
investment in that business.
Investment restrictions
The Board will apply the following restrictions on the size of its
investments:
· not more than twenty per cent. (20%) of the Gross Asset Value at
the time of investment will be invested in the securities of a single issuer
(such restriction does not, however, apply to investment of cash held for
working capital purposes and pending investment or distribution in near cash
equivalent instruments including securities issued or guaranteed by a
government, government agency or instrumentality of any EU or OECD Member
State or by any supranational authority of which one or more EU or OECD Member
States are members);
· the Company will only make an investment in an unquoted company
if the aggregate interest of the Company in unquoted companies at the time of
such investment is not more than ten per cent. (10%) of the Net Asset Value of
the Company at that time. This will mean if a quoted portfolio company is
delisted or an unquoted investment is revalued with the effect of increasing
the Company's interest in unquoted investments to above ten per cent. (10%) of
the Company's Net Asset Value at that time, the Company will not be in breach
of its Investment Policy and will not have to divest itself of any unquoted
investments. Nevertheless, while the Company's interest in unquoted
investments remains above ten per cent. (10%) of its Net Asset Value, the
Company will not be able to make any further investments in unquoted
companies;
· total net investment Derivative exposure will not exceed twenty
per cent. (20%) of Gross Asset Value at the time of investment; and
· total exposure to any single counterparty which has issued
Derivatives to the Company will not exceed twenty per cent. (20%) of Gross
Asset Value at the time of investment.
The Company will comply with the following investment restrictions for so long
as they remain requirements of the UK Listing Rules:
· neither the Company, nor any of its subsidiaries will conduct any
trading activity which is significant in the context of the Group as a whole;
and
· no more than ten per cent. (10%), in aggregate, of the value of
the total gross assets of the Company will be invested in investment companies
or investment trusts which are listed on the Official List other listed
closed-ended investment funds (except to the extent that those investment
funds have stated investment policies to invest no more than fifteen per cent.
(15%) of their total assets in other investment companies which are listed on
the Official List); and
· the Company must, at all times, invest and manage its assets in a
way which is consistent with its object of spreading investment risk and in
accordance with the published Investment Policy.
Additionally, the Company will itself not invest more than 10% of its gross
assets in other investment companies or investment trusts which are listed on
the Official List.
Treasury policy
Until the Company is fully invested, and pending re-investment or distribution
of cash receipts, the Company will use Derivatives, cash, cash equivalents,
exchange traded funds, near cash instruments and money market instruments in
accordance with the Investment Policy.
The Company expects to maintain any non-operational cash balances in Japanese
yen.
Under the amended Investment Policy, the Company may use Derivatives (as
defined in the Investment Policy) for efficient portfolio management purposes.
Such purposes would include the management of cash received by the Company
upon the occurrence of significant liquidity events (including, without
limitation, the receipt of proceeds of fundraisings, the realisation of
portfolio assets and other cash generative events, such as the completion of a
management buyout by an investee company). Such derivative contracts may, for
example, give the Company exposure to the whole or a sub-section of the
Japanese stock market until such time as the Investment Adviser determines
that the Company's derivative position should be liquidated and invested in an
investee company in accordance with the Investment Policy.
The Board will apply the following restrictions on Derivative exposure:
· total net investment Derivative exposure will not exceed twenty
per cent. (20 per cent.) of Gross Asset Value at the time of investment; and
· total exposure to any single counterparty which has issued
Derivatives to the Company will not exceed twenty per cent. (20 per cent.) of
Gross Asset Value at the time of investment.
The Company's exposure to any investments in Derivatives will be monitored
daily by the Investment Adviser and AIFM and, in the event that any particular
Derivative exposure was determined by the Investment Adviser, the AIFM or the
Board to be inappropriately large, that Derivative exposure would be closed
out as soon as reasonably practicable and in any event within three Business
Days.
Gearing Policy
The Company may use borrowings and other gearing to seek to enhance investment
returns at a level (not exceeding 20 per cent. of the Company's net assets
calculated at the time of drawdown) which the Directors, the AIFM and Rising
Sun consider to be appropriate. It is expected that gearing will primarily
comprise bank borrowings, public bond issuance or private placement
borrowings, although overdraft or revolving credit facilities may be used to
increase acquisition and cash flow flexibility.
Hedging Policy
Although the Company does not currently intend to enter into any arrangements
to hedge its underlying currency exposure to investments denominated in
Japanese yen, it may in future, at its discretion, enter into currency hedging
arrangements using futures, forwards, swaps or other derivative instruments.
Material breach of investment restrictions
In the event of any breach of the investment restrictions applicable to the
Company, Shareholders will be informed of the actions to be taken by Rising
Sun and the Company through a Regulatory Information Service.
Amendment to Investment Policy
No material change will be made to the Investment Policy without the approval
of Shareholders by ordinary resolution and the FCA in accordance with the UK
Listing Rules.
Dividend policy
The Company's intention is to look to achieve its results primarily through
capital appreciation. As such, no specific dividend policy has been
established and any distributions will be made entirely at the discretion of
the Board.
Distribution policy
The Company believes that the substantial undervaluation of Japanese equities,
coupled with an activist strategy designed to unlock underlying value should
allow the Company to achieve significant investment results over time. Given
the nature of this strategy, however, it is possible that such returns could
be "lumpy" and unpredictable. Accordingly, the Company will target results
primarily through capital appreciation. No specific dividend policy will be
established in the first instance and any distributions will be made entirely
at the discretion of the Board.
Notwithstanding the foregoing, the Company will make such distributions as may
be required to ensure compliance with the rules relating to investment trusts.
Key performance indicators ("KPIs")
The Board measures the Company's success in attaining its investment objective
by reference to the following KPIs:
(i) Long-term capital growth
The Board considers the NAV and Share price total return figures to be the
best indicator of performance over time and this therefore is the main
indicator of performance used by the Board. The NAV and Share price total
return for the year ended 31 December 2025 were +17.4% and +12.3% respectively
(31 December 2024: +15.2% and +16.8% respectively).
(ii) Revenue return per Share
The Company's revenue return per Ordinary Share based on the weighted average
number of shares in issue during the year was 4.30p (31 December 2024: 3.27p).
(iii) Discount/premium to NAV
The discount/premium relative to the NAV per Share represented by the share
price is closely monitored by the Board. The average discount to NAV over the
year was 3.4% and the shares traded in a range of a premium of 1.8% to a
discount of -10.1%. The share price closed at a 7.5% discount to the NAV as at
31 December 2025 (31 December 2024: discount of 3.0%).
(iv) Control of the level of ongoing charges
The Board monitors the Company's operating costs carefully. Based on the
Company's average net assets for the year ended 31 December 2025, the
Company's ongoing charges figure calculated in accordance with the AIC
methodology was 1.12% (31 December 2024: 1.18%).
Risk and Risk Management
Principal and emerging risks and uncertainties
The Company has carried out a robust assessment of its principal and emerging
risks and the procedures in place to identify any emerging risks are described
below.
Procedures to identify principal or emerging risks
The Board is responsible for the management of risks faced by the Company and
delegates the review process of this to the Audit Committee (the "Committee").
The Committee carries out, at least annually, a robust assessment of principal
and emerging risks and uncertainties and monitors the risks on an ongoing
basis. The Committee has a dynamic risk matrix in place to help identify key
risks in the business and oversee the effectiveness of internal controls and
processes. The Committee ensures appropriate controls are in place to reduce
risks to an acceptable level.
As part of the risk review, the Committee considered the challenging global
economic and geopolitical environment including, but not limited to, the
continuing effects of global trade tariffs, armed conflicts, climate change,
inflation and interest rates. Particular attention was also given to risks
arising from minority activist shareholder concentration and broader market
volatility.
The experience and knowledge of the Board is important, as is advice received
from the Board's service providers, specifically the Alternative Investment
Fund Manager ("AIFM"), who is responsible for risk and portfolio management
services. The AIFM outsources the portfolio management to the Investment
Adviser. The following is a description of the work that each service provider
highlights to the Board on a regular basis.
1. Investment Adviser: the Investment Adviser provides a report to the Board
at least quarterly, or periodically as required, on industry trends and
insight to future challenges in the Japanese equity sector including the
regulatory, political and economic changes likely to impact the sector;
2. AIFM: following advice from the Investment Adviser and other service
providers, the AIFM maintains a register of identified risks including
emerging risks likely to impact the Company. The Board reviews the risk
register on a quarterly basis and updates it if necessary;
3. Corporate Broker: provides advice specific to the Company periodically, on
the Company's sector, competitors and the investment company market whilst
working with the Board and Investment Adviser to communicate with
shareholders;
4. Company Secretary and Auditor: brief the Board on forthcoming
legislation/regulatory change that might impact on the Company. The Auditor
provides their findings at least annually; and
5. Association of Investment Companies ("AIC"): The Company is a member of the
AIC, which provides regular technical updates as well as drawing members'
attention to forthcoming industry and regulatory issues.
Procedure for oversight
The Board is responsible for the management of risks faced by the Company. The
principal and emerging risks, together with a summary of the processes and
internal controls used to manage and mitigate risks where possible are
outlined below.
Risk Possible Consequences Possible Impact (post controls) Risk Mitigation
MARKET The Company may not meet its investment objective HIGH The Investment Adviser has a well-defined investment strategy and process
which is regularly and rigorously reviewed by both the independent Board of
Directors and the AIFM.
The Investment Adviser has a contract in place which defines the duties and
responsibilities of the Investment Adviser and has safeguards in place
including provisions for the termination of the agreement upon 12 months'
notice, not to be served within the first 4 years from First Admission.
The Investment Adviser has stated that it will run a diversified portfolio and
the Board reviews the composition and performance of that portfolio as well as
the performance of the Company at each Board meeting. A review of transactions
is performed at each quarterly Board meeting.
Management Accounts, and Income and expense forecasts are reviewed at
quarterly Board meetings.
The Investment Adviser sends the Board its monthly factsheet and an investment
report on a quarterly basis.
The Board considers the Investment Adviser and the AIFM's appointment on an
annual basis.
MARKET Board fails to monitor whether there is style drift within the investment LOW The Investment Adviser provides individual company updates on both existing
process. and target holdings regularly. These updates include key metrics that allow
the Board to monitor whether these companies are consistent with the original
investment thesis.
Details of the portfolio composition are monitored by the AIFM and also
provided regularly to allow the Board to see if the portfolio construction is
consistent with investment guidelines.
MARKET The Company's shares trade at a discount to NAV MEDIUM The Investment Adviser, AIFM and Broker review market conditions on an ongoing
basis.
Shares may trade to their NAV through further issues and buybacks, as
appropriate.
Discount protection mechanism in place whereby the Board will consider
whether, in light of prevailing market conditions, the Company should purchase
its own shares.
MARKET Board fails to monitor the Company's ability to build the Portfolio Low The Investment Advisor/AIFM/Broker review market conditions on an ongoing
basis.
Quarterly meetings with the Investment Adviser to discuss market environment,
team and business dynamics and ongoing viability of the strategy.
The Investment Adviser will inform the AIFM and Board as soon as they are
aware of any issues that might compromise their ability to deliver vs the
strategy.
MARKET Board fails to monitor the execution of the Investment Process Medium Quarterly meetings with the Investment Adviser that cover implementation of
the Investment Process. The Board relies on the AIFM to monitor the
implementation of individual trades.
If the Investment Adviser considers the opportunity to be appropriate after
their extensive due diligence process, the Investment Adviser will send an
initial recommendation to the Board and AIFM, to add a target company to the
investible universe.
Upon approval of a target company by the Board and AIFM, the Investment
Adviser will send a formal recommendation, outlining the rationale for the
recommendation, along with the size of investment and forward to the AIFM for
consideration.
Upon receipt of approval from the AIFM, the Investment Adviser will arrange
execution.
The Board regularly carries out Investment Process reviews of the Investment
Adviser.
OPERATIONAL Cyber Security risks could potentially lead to breaches Medium Cyber security policies and procedures are implemented by the Company's key
service providers.
The AIFM has cyber essentials accreditation, which is reviewed on a continuous
basis.
Penetration testing is carried out by the AIFM and Administrator every year.
OPERATIONAL Failure to provide notification of FEFTA, FOREX, FIEA threshold clearances Medium The Investment Adviser is tasked with notifying the AIFM at time of trade
along with required information to Hibiya-Nakata to allow for timely filing whenever a deal has caused the holding to surpass a threshold.
with the appropriate regulatory bodies
Filing is delegated to third party specialist Hibiya-Nakata, the Company's
Tokyo-based legal advisor.
The AIFM performs their own daily review of these limits against a portfolio
that is reconciled to both the Investment Adviser and Custody records.
Once a deal has surpassed a threshold, the AIFM continue to provide
Hibiya-Nakata with any subsequent trades to ensure their records can be as up
to date as possible, this will allow them to act quickly in the event that a
subsequent threshold is passed.
OPERATIONAL It may be difficult for shareholders to realise their investment and there may Medium Secondary market liquidity can be improved by strong investor communications
not be a liquid market in the shares and having active broker and market maker. The Broker monitor and report to
the Board as soon as they are aware of any issues.
Funding liquidity to satisfy redemption rights is not applicable, as the
Company is a closed-ended fund.
Discount protection mechanism in place whereby the Board will consider
whether, in the light of prevailing market conditions, the Company should
purchase its own shares.
OPERATIONAL A corporate action is missed and the Company suffers a consequential loss Medium The Custodian (Northern Trust) and Investment Adviser monitor such actions.
Northern Trust is a very large and experienced global Custodian and produces
an Internal Controls report which is reported to the Board.
MARKET Climate change has recently become one of the most critical issues confronting Low The Board is also considering the threat posed by the impact of climate change
asset managers and their investors. and its effects on the operations of the Investment Adviser and other major
service providers. As climate change's impact becomes more common, the
Investors can no longer ignore the impact that the world's changing climate resiliency, business continuity planning and the location strategies of our
will have on their portfolio, with the inevitable impact on returns service providers will come under more scrutiny.
MARKET Interest rate / Inflation Medium The Company may use derivative instruments such as futures, forwards, swaps or
other derivative instruments, to protect the Company from fluctuations in
Risk / Currency foreign exchange rates.
The AIFM constantly monitors risks and impact on portfolio, discussing with
the Investment Adviser and Board as appropriate.
The AIFM would review any proposal for the use of derivatives against the
requirements of the prospects.
ARTIFICIAL INTELLIGENCE Risks that the emergence of increasingly advanced AI will lead to new risks to EMERGING The Company, its advisers and service providers will aim to utilise the power
the Fund, including but not limited to, decline in human autonomy, increased of AI to enhance capabilities, rather than fall foul of the potential pitfalls
cybersecurity vulnerabilities, algorithm perpetuated bias through using its emergence presents. Through careful monitoring of the new technologies
historical data, insufficient training data to perform correctly and algorithm being released into the world, it will be hoped that the Company can utilise
driven price manipulation artificial intelligenceI to its benefit.
GEOPOLITICAL Act of War; EMERGING The portfolio is constantly monitored by the Investment Adviser, ensuring the
portfolio avoids any sanction lists and exposures where possible, together
· Sanctions and restrictions imposed with consideration of any market impacts.
· Volatile markets and general uncertainty The Board and the AIFM continue to monitor geopolitical developments and their
potential implications for portfolio companies, market conditions and
· Potential world order change and globalisation liquidity. This includes considering the potential impact of further
escalation in the Middle East, particularly via energy price shocks and
· The global impact of the re-election of Donald Trump as the broader risk sentiment.
President of the USA
The Registrar monitors payments of dividends to shareholders in line with
regulations, including sanctions-related restrictions.
Cyber Security risks could potentially lead to breaches
Medium
Cyber security policies and procedures are implemented by the Company's key
service providers.
The AIFM has cyber essentials accreditation, which is reviewed on a continuous
basis.
Penetration testing is carried out by the AIFM and Administrator every year.
OPERATIONAL
Failure to provide notification of FEFTA, FOREX, FIEA threshold clearances
along with required information to Hibiya-Nakata to allow for timely filing
with the appropriate regulatory bodies
Medium
The Investment Adviser is tasked with notifying the AIFM at time of trade
whenever a deal has caused the holding to surpass a threshold.
Filing is delegated to third party specialist Hibiya-Nakata, the Company's
Tokyo-based legal advisor.
The AIFM performs their own daily review of these limits against a portfolio
that is reconciled to both the Investment Adviser and Custody records.
Once a deal has surpassed a threshold, the AIFM continue to provide
Hibiya-Nakata with any subsequent trades to ensure their records can be as up
to date as possible, this will allow them to act quickly in the event that a
subsequent threshold is passed.
OPERATIONAL
It may be difficult for shareholders to realise their investment and there may
not be a liquid market in the shares
Medium
Secondary market liquidity can be improved by strong investor communications
and having active broker and market maker. The Broker monitor and report to
the Board as soon as they are aware of any issues.
Funding liquidity to satisfy redemption rights is not applicable, as the
Company is a closed-ended fund.
Discount protection mechanism in place whereby the Board will consider
whether, in the light of prevailing market conditions, the Company should
purchase its own shares.
OPERATIONAL
A corporate action is missed and the Company suffers a consequential loss
Medium
The Custodian (Northern Trust) and Investment Adviser monitor such actions.
Northern Trust is a very large and experienced global Custodian and produces
an Internal Controls report which is reported to the Board.
MARKET
Climate change has recently become 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 portfolio, with the inevitable impact on returns
Low
The Board is also considering the threat posed by the impact of climate change
and its effects on the operations of the Investment Adviser and other major
service providers. As climate change's impact becomes more common, the
resiliency, business continuity planning and the location strategies of our
service providers will come under more scrutiny.
MARKET
Interest rate / Inflation
Risk / Currency
Medium
The Company may use derivative instruments such as futures, forwards, swaps or
other derivative instruments, to protect the Company from fluctuations in
foreign exchange rates.
The AIFM constantly monitors risks and impact on portfolio, discussing with
the Investment Adviser and Board as appropriate.
The AIFM would review any proposal for the use of derivatives against the
requirements of the prospects.
ARTIFICIAL INTELLIGENCE
Risks that the emergence of increasingly advanced AI will lead to new risks to
the Fund, including but not limited to, decline in human autonomy, increased
cybersecurity vulnerabilities, algorithm perpetuated bias through using
historical data, insufficient training data to perform correctly and algorithm
driven price manipulation
EMERGING
The Company, its advisers and service providers will aim to utilise the power
of AI to enhance capabilities, rather than fall foul of the potential pitfalls
its emergence presents. Through careful monitoring of the new technologies
being released into the world, it will be hoped that the Company can utilise
artificial intelligenceI to its benefit.
GEOPOLITICAL
Act of War;
· Sanctions and restrictions imposed
· Volatile markets and general uncertainty
· Potential world order change and globalisation
· The global impact of the re-election of Donald Trump as the
President of the USA
EMERGING
The portfolio is constantly monitored by the Investment Adviser, ensuring the
portfolio avoids any sanction lists and exposures where possible, together
with consideration of any market impacts.
The Board and the AIFM continue to monitor geopolitical developments and their
potential implications for portfolio companies, market conditions and
liquidity. This includes considering the potential impact of further
escalation in the Middle East, particularly via energy price shocks and
broader risk sentiment.
The Registrar monitors payments of dividends to shareholders in line with
regulations, including sanctions-related restrictions.
Viability Statement
The Directors have assessed the viability of the Company for the period to 31
December 2028 (the "Period"). The Board believes that the Period, being
approximately three years, is an appropriate time horizon over which to assess
the viability of the Company, particularly when taking into account the nature
of the Company's investment strategy and the principal risks outlined above.
In accordance with the Company's articles, a continuation vote was proposed at
the Company's 2025 AGM, with the next such vote to be held at the 2027 AGM.
This was the first continuation vote for the Company since its inception and
passed with 99.99% of voting in favour. Taking into consideration the Board's
assessment, the Company's track record over the past five years and the
successful continuation vote in 2025, the Directors have a reasonable
expectation that the Company will be able to continue to operate and to meet
its liabilities as they fall due over the Period and that the continuation
vote in 2027 will be successful.
In their assessment of the prospects of the Company, the Board considered each
of the principal and emerging risks and uncertainties set out above and the
liquidity and solvency of the Company. The Board also considered the Company's
income and expenditure projections and the fact that the majority of the
Company's investments comprise reasonably realisable securities, which could,
if necessary, be sold to meet the Company's funding requirements under all
stress scenarios reviewed by the Directors. Portfolio changes, market
developments, level of premium/discount to NAV and share buybacks/share issues
are discussed at quarterly Board meetings. The internal control framework of
the Company is subject to a formal review on at least an annual basis.
The level of the ongoing charges is dependent to a large extent on the level
of net assets. The Company's income from investments and cash realisable from
the sale of its investments provide substantial cover to the Company's
operating expenses, and any other costs likely to be faced by the Company over
the Period of their assessment.
Section 172 Statement
This section of the Annual Report explains how the Board has discharged its
duties under section 172(1) of the Companies Act 2006, namely to promote the
success of the Company for the benefit of its members as a whole. In doing so,
the Board has had regard to the likely long-term consequences of its
decisions, the interests of the Company's stakeholders, the need to maintain
high standards of business conduct, and the impact of the Company's activities
on the environment.
The Board recognises that effective engagement with stakeholders is
fundamental to sound decision-making and long-term value creation. As an
externally managed investment company, the Company has no employees and
instead operates through a number of external service providers, including the
Investment Adviser, Administrator, Company Secretary, Corporate Broker, Public
Relations Adviser, Custodian and banking providers. These service providers
are key stakeholders and play an important role in supporting the Board's
governance responsibilities and its engagement with shareholders and the wider
market.
The Board has identified the Company's principal stakeholders and considers
their interests as part of its ongoing oversight and strategic
decision-making. The Board regularly assesses both the actual and potential
impact of its decisions on these stakeholders, particularly in the context of
strategy, performance, risk management and capital allocation. This approach
helps to ensure that stakeholder considerations are embedded within the
Board's deliberations and that decisions are taken with a view to the
Company's long-term sustainability and success.
Key Board decisions and developments
The Board seeks to act in the best interests of shareholders as a whole and,
in doing so, has regard to the long-term consequences of its decisions, the
Company's purpose, values, investment objective and policy, and the interests
of the Company's key stakeholders. The Board considers these factors both in
discussions and when making decisions, alongside regular and detailed reviews
of the Company's portfolio, strategy and performance. Set out below are
examples of key discussions held, and decisions taken by the Board during the
financial year to 31 December 2025.
· During the year, the Board approved an interim dividend of 3.25p
per Ordinary Share, which was paid to shareholders on 23 May 2025.
· During the year, three members of the Board undertook a visit to
Japan to attend the annual CLSA conference, which has a focus on corporate
governance and activism, and to meet the Investment Adviser's Tokyo based
team. The visit provided the Board with enhanced insight into the local market
environment, corporate governance standards and the strategic positioning of
key portfolio holdings, thereby strengthening its oversight of the Company's
investment strategy and risk profile.
· At the Company's Annual General Meeting ("AGM") held in June
2025, shareholders voted overwhelmingly in favour of the continuation of the
Company, with 99.99% of votes cast supporting the resolution. The Board had
recommended that shareholders vote in favour of continuation, having reviewed
the Company's performance and prospects. The next continuation vote will be
held in 2027.
· Mr Noel Lamb resigned from the Board on 5 June 2025, reducing the
Board's size to six. This was part of the already designated direction of
travel communicated to shareholders.
· On 10 September 2025, the Company's block listing application for
15,000,000 Ordinary Shares with a par value of 1p each was approved. The
shares were admitted to the Official List of the Financial Conduct Authority
and for trading on the London Stock Exchange's main market. The Board approved
the use of this block listing facility to enable the issue of shares over time
to satisfy investor demand, provided that any shares are issued at a price
above the prevailing NAV per share and in the best interests of existing
shareholders. During the year to 31 December 2025, 3,373,282 Ordinary Shares
were issued with aggregate proceeds of £7,256,000. Following the year end,
the Company has issued 2,300,000 Ordinary Shares for aggregate gross proceeds
of £5,685,700.
· The Board approved the continuing appointment of the Investment
Adviser and key advisers, following an annual formal assessment in November
2025. Having expert advisers and consistency in relationships has significant
implications for the long-term success of the Company. Thus far, the Company's
key advisers have served the Company well.
· The Chief Executive Officer of Dalton Investments attended a NAVF
Board meeting during the year to provide a governance-focused update on the
management of principal risks. The presentation covered fund resourcing, risk
oversight processes, and the management of potential overlaps between NAVF and
other Dalton funds. The functioning of the memorandum of understanding was
also reviewed, including the production of a quarterly schedule identifying
joint investments to ensure transparency and appropriate governance oversight.
· On 17 December 2025, the Company announced participation in a
successful tender offer for Hogy Medical, led by Carlyle, following engagement
led by Rising Sun Management ("RSM"). RSM engaged with the Board regarding the
proposed transaction, including the implications of increased portfolio
illiquidity arising from the reinvestment structure. Having carefully
considered these factors, the Board concluded that the increased illiquidity
was acceptable in the context of the Company's strategy and long-term return
objectives. Under the transaction, NAVF and co-investors agreed to tender
their 27.58% stake, including NAVF's 8.58% holding. This transaction, which
will take Hogy Medical private and delist it from the Tokyo Stock Exchange,
values NAVF's holding at approximately £62.4 million, an increase from its
previous valuation of £55.2 million. Following the tender offer, NAVF and
co-investors reinvested a portion of their proceeds for an approximately 10%
economic interest in a Carlyle-affiliated acquiring entity.
· The Board provided continuous support for the Investment
Adviser's approach to investment activism (see the Investment Adviser's
report) ensuring that their activism aligns with the long-term goals for the
Company. The activism is focused on governance improvements, growth strategies
and long-term value creation in Japanese investee companies.
· On 20 January 2026, the Company restated its investment
restrictions to clarify that investments in other listed closed-ended
investment funds will not exceed 10% of total assets. This amendment was made
to ensure alignment with regulatory expectations and market practice, and to
provide greater transparency to shareholders regarding portfolio construction
limits. The Board considers this to be a non-material clarification rather
than a substantive change to the Company's investment policy.
· A General Meeting was held on 5 February 2026 at which
shareholders approved the cancellation of the Company's share premium account,
which stood at £239,056,149 as at 16 January 2026. The Board convened the
meeting to increase the Company's distributable reserves, thereby providing
greater flexibility for potential future distributions to shareholders. The
resolution was passed with 99.98% of votes cast in favour and the cancellation
became effective on 12 March 2026.
Importance of engagement Examples of engagement and key decisions
Shareholders
The Board's principal concern is the interests of the Company's shareholders Clear and timely communication of the Company's strategy and performance
and potential investors and the Directors have considered this duty when against its objectives enables shareholders to make informed investment
making strategic decisions during the year that affect shareholders. decisions, taking into account short, medium and longer-term considerations.
Ongoing engagement with shareholders allows the Board to understand
The Board maintains open dialogue between shareholders, the current Investment shareholder perspectives, align decision-making with the interests of
Adviser and other service providers. The Investment Adviser and the Company's shareholders as a whole, and support the Company's long-term sustainable
Corporate Broker meet regularly with the Company's shareholders to provide success.
Company updates and to foster regular dialogue. Feedback from meetings is
communicated with the Board. The Chairman and other Directors are always happy
to meet with shareholders, and welcome conversations.
As a public company listed on the London Stock Exchange, the Company is With the assistance of regular discussions with and the formal advice of the
subject to the Listing Rules and the Disclosure Guidance and Transparency Company's Legal Counsel, Secretary and Corporate Broker, the Board abides by
Rules. The UK Listing Rules include a listing principle that a listed company the UK Listing Rules at all times.
must ensure that it treats all shareholders of the same class of shares that
are in the same position equally in respect of the rights attaching to such The Board considers shareholder engagement to be of paramount importance and
shares. is committed to ensuring that the AGM is a meaningful and participative forum
for all shareholders. The Company values the feedback and questions received
The Board is pleased to invite shareholders to attend the AGM on 4 June 2026, from shareholders both ahead of and during the AGM. Where a significant
with more details included in the Chairman's statement. proportion of votes is cast against any resolution, the Board will engage with
shareholders to understand the reasons for the dissent and will outline, in
the announcement of the AGM results, the steps it intends to take to consult
shareholders further. Following this consultation, the Board will provide an
update no later than six months after the AGM, and the subsequent Annual
Report will describe how shareholder feedback has informed the Board's
decision-making and any actions taken or resolutions proposed.
Shareholders are able to raise concerns directly with the Chairman or the
Board, without the involvement of the Investment Adviser or Company Secretary,
either in person at the AGM or other events, or in writing via the Company's
registered office. Any matters raised by shareholders are noted and considered
by the Board as part of its ongoing engagement and decision-making process.
The Board and the Investment Adviser regard effective communication and
engagement with shareholders as a key priority. The Board regularly reviews
the Company's share register and receives regular reports from the Investment
Adviser and Corporate Broker outlining feedback received from shareholder
meetings.
Shareholders are kept informed through the publication of annual and
half-yearly reports, monthly factsheets and commentary from the Investment
Adviser available via the Company's website, as well as attendance at events
where the Investment Adviser presents. The Company's annual and half-yearly
reports are published on the Company's website and circulated to shareholders
on request. This information is supplemented by the daily calculation and
publication of the Company's NAV, which is released via a Regulatory
Information Service and made available on the Company's website.
Investment Adviser
The most significant service provider for the Company's long-term success is The Board monitors the Company's investment performance in relation to its
the Company's Investment Adviser, RSM along with that of the AIFM, FundRock in objectives and investment policy and strategy. The Board regularly assesses
accordance with the Alternative Investment Fund Managers Directive ("AIFMD"), the experience and resources of the Investment Management team and the
for the purpose of providing investment advisory services to the Company. commitment of the Investment Adviser to promote the Company and foster
shareholder relations, and to ensure that the Company's objective of providing
The Investment Adviser is responsible for the management of the Company's capital growth combined with dividend income for its investors are met.
portfolio in accordance with the Company's investment policy and the terms of
the Investment Management Agreement. During the year, the Board received regular presentations from the existing
Investment Adviser and members of the wider investment team at each Board
The Investment Adviser has placed trust in the investee companies to respond meeting, allowing the Directors to exercise effective oversight of portfolio
appropriately to operational challenges and to ensure that high standards of performance and strategic direction. The performance of the Investment Adviser
corporate governance and regard for shareholders are at the forefront of was also reviewed formally during the Management Engagement Committee meeting.
managerial decision-making. The last review was undertaken during the Management Engagement Committee
meeting held in November 2025 at which the Committee agreed that the
RSM, has combined capabilities in origination, evaluation and transaction Investment Adviser's service delivery was acceptable.
execution with expertise across equities, shareholder activism and active
portfolio management. RSM maintains a management committee that is responsible In addition, the Directors engaged closely with the Investment Adviser and
for reviewing and evaluating potential investment opportunities. RSM screens advisers outside scheduled meetings on matters relating to portfolio
investment opportunities to identify potential investments that meet the management, administration and governance oversight, including relationships
Company's investment objective and comply with its investment policy. Through with third-party service providers and engagement with shareholders.
this screening process, RSM determines whether to proceed with detailed due
diligence and evaluation of the investee company.
After a potential investment opportunity has been identified and screened
against the target investment criteria and if it determines to proceed, then
RSM performs a detailed due diligence review of the investee company, where
key risks, including those related to ESG factors, are assessed. RSM employs a
robust due diligence process applying principles of quantitative analysis to
stress test assumptions, price capital structures, and determine expected
returns in the context of the risks faced.
Where an investment opportunity proceeds to the execution phase, RSM will
manage the transaction process, including co-ordinating the work of other
professional advisers and service providers, including agents, valuers,
lawyers, accountants, and tax advisers.
The Board considers ongoing engagement with the Investment Adviser and The Board relies upon the AIFM to ensure the obligations under the Consumer
advisers to be fundamental to effective oversight, informed decision-making Duty regulations continue to be adopted appropriately. All communications
and the long-term success of the Company. Regular dialogue enables the Board including the website, factsheets and other published documentation are
to assess performance against the Company's investment objective and policy, reviewed ahead of publication to ensure they are appropriate for all end
to understand portfolio positioning and risks, and to ensure that the users. A 'value for money' assessment is also undertaken annually and is made
Company's strategic objectives remain appropriate. The Board also places available to distributors on request.
importance on engagement outside formal Board meetings, recognising that
timely interaction supports effective governance, accountability and alignment
with shareholders' interests.
Service providers
As an externally managed investment trust, the Company conducts all its The Board has strong working relationships with the Investment Adviser,
business through its key service providers. Before the engagement of a service Broker, Legal Adviser, Company Secretary, Administrator and Depositary.
provider, the Board ensures that the Company's business outlook as well as its Experienced and capable third parties provide the services required to be a
values are similar to those of the service provider. well-functioning Company. Representatives of all the main service provider
functions present regularly to the Board.
A list of the Company's key service providers can be found in the Annual
Report. The Board receives internal control reports from their service providers.
During the year under review, the Board sought and received reassurance that
All service providers are subject to an annual performance review, to ensure all key service providers had appropriate business continuity plans in place.
reappointment is in the best interests of the Company's shareholders. All key service providers have maintained a high standard of service and
demonstrate operational resilience.
The Auditor is invited to attend the Audit Committee meeting twice a year. The
Audit Committee Chairman maintains regular contact with the Audit partner to
ensure the audit process is undertaken effectively.
Wider community and environment
The Company and its appointed professional suppliers keep abreast of the rules In making investment decisions, the Investment Adviser considers qualitative
and regulations affecting the investment company sector. measures such as the environmental and social impact of an investee company as
well as financial and operational measures.
The Investment Adviser, as steward of the Company's assets, engages with the
investee companies to ensure high standards of governance. The Board, Company The Investment Adviser takes voting obligations seriously and there are
Secretary and AIFM are responsible for ensuring that various regulatory and multiple structures in place to ensure votes are cast in all investee company
statutory obligations are met. shareholder meetings. While the Investment Adviser evaluates external proxy
agency reports when considering how they might vote, they do not outsource
The Board is also conscious of the importance of providing a vehicle which voting to a third party and are happy to go against both their recommendations
meets the needs of its shareholders, including retail investors. and the wishes of management, when they consider it important to do so.
The Company Secretary and AIFM regularly report to the Board any changes in
the regulatory environment and as AIC members, the Board can draw on the
resources available detailing any regulatory changes.
In summary, the Directors are mindful of their duties under section 172 of the
Companies Act 2006 and take decisions with due regard to the long-term
consequences for the Company and its key stakeholders. The Board believes that
the Company's long-term, sustainable success is intrinsically linked to the
effective engagement with, and consideration of, those stakeholders.
Section 2 - Governance
Directors' Report
The Directors are pleased to present their report and financial statements for
the year ended 31 December 2025.
Strategic Report
The Directors' Report should be read in conjunction with the Strategic Report.
Corporate Governance
The Corporate Governance Statement forms part of this report.
Risks and Risk Management
The Company's principal and emerging risks and Risk Management Report can be
found in the annual report.
Legal and taxation status
The Company is an investment company within the meaning of Section 833 of the
Companies Act 2006. The Company conducts its affairs to meet the requirements
for approval as an investment trust under section 1158 of the Corporation Tax
Act 2010.
The Company has received initial approval as an investment trust and the
Company must meet eligibility conditions and ongoing requirements for
investment trust status to be maintained. In the opinion of the Directors, the
Company has met the conditions and requirements for approval as an investment
trust for the year ended 31 December 2025.
Market information
The Company's Ordinary Shares are listed on the Official List of the FCA and
trading on the main market of the London Stock Exchange. The unaudited NAV of
the Ordinary Shares of the Company is published daily via RNS.
Retail distribution of investment company shares via financial advisers and
other third-party promoters
As a result of the FCA rules determining which investment products can be
promoted to retail investors, certain investment products are classified as
"non-mainstream pooled investment products" and face restrictions on their
promotion to retail investors.
The Company has concluded that the distribution of its shares, being shares in
an investment trust, is not restricted because of the FCA rules described
above.
The Company currently conducts its affairs so that the shares issued by the
Company can be recommended by financial advisers to retail investors and
intends to continue to do so for the foreseeable future.
Articles of Association
Amendments to the Company's Articles of Association require a Special
Resolution to be passed by the Company's shareholders, requiring a majority of
at least 75% of the persons voting on the relevant resolution.
Management
The Board
The Board is entirely comprised of independent non-executive Directors who are
responsible to shareholders for the overall management of the Company and is
chaired by Rosemary Morgan. Alicia Ogawa acts as Senior Independent Director.
The Board has adopted a Schedule of Matters Reserved for the Board which sets
out the division of responsibilities between the Board and its various
Committees, together with the duties of the Board, further details can be
found in the annual report.
Through the Committees and the use of external independent advisers, the Board
manages risk and governance of the Company.
Appointment and replacement of the Board
The rules concerning the appointment and replacement of Directors are
contained in the Company's Articles of Association which require that all
Directors shall be subject to election at the first AGM after appointment and
re‑election annually thereafter. Further details of the Board's process for
the appointment and replacement of Board members can be found in the Annual
Report.
Alternative Investment Fund Portfolio Managers Directive ("AIFMD")
In accordance with the AIFMD, the AIFM must ensure that an annual report
containing certain information on the Company is made available to investors
for each financial year. The investment funds sourcebook of the FCA (the
"Sourcebook") details the requirements of the annual report. All the
information required by those rules is included in this Annual Report or will
be made available on the Company's website.
Alternative Investment Fund Manager ("AIFM")
The Company is classified as an Alternative Investment Fund under the AIFMD
and has appointed FundRock Management Company (Guernsey) Limited as its AIFM.
The AIFM is responsible for portfolio management of the Company, including the
following services:
· Risk management - Portfolio management is delegated to the
Investment Adviser;
· Review financial reporting prepared by the Administrator;
· Ensuring compliance with AIFMD regulations and reporting; and
· Monitor and ensure compliance with investment and cash
restrictions and debt covenants.
The AIFM is entitled, with effect from First Admission to an annual fee
calculated at a rate of 0.04 per cent. per annum of NAV up to £250 million,
plus 0.025 per cent. per annum of NAV in excess of £250 million. The AIFM fee
is subject to a minimum fee of £85,969 per annum and includes an annual
adjustment for inflation.
The AIFM Agreement shall continue in force until terminated by either the AIFM
or the Company by giving to the other no less than sixth months' prior written
notice, provided that such notice may not be served earlier than the date
being 12 months from the date of the AIFM Agreement. The AIFM Agreement may be
terminated earlier by either party with immediate effect in certain
circumstances, including, if the other party shall go into liquidation or an
order shall be made or a resolution shall be passed to put the other party
into liquidation or the other party has committed a material breach of any
obligation outlined in the AIFM Agreement, and in the case of a breach which
is capable of remedy fails to remedy it within 30 days.
The Company has granted to the AIFM and certain other indemnified parties, a
customary indemnity against losses which may arise in relation to the AIFM's
performance of its duties under the AIFM Agreement.
The Investment Advisory Agreement is governed by the laws of England and
Wales.
Investment Adviser
The Company, the AIFM and Investment Adviser entered into the Investment
Advisory Agreement on 7 January 2020, pursuant to which Rising Sun Management
Limited will provide investment advisory services to the AIFM and the Company,
and shall be entitled, with effect from First Admission, to receive an annual
fee calculated as 0.85 per cent. of the Company's net assets (exclusive of
VAT) from the Company, in respect of the services provided under the
Investment Advisory Agreement.
Pursuant to the terms of the Investment Advisory Agreement, Rising Sun
Management Limited may resign by giving the Company not less than 12 months'
written notice. Further, the Investment Advisory Agreement may be terminated
by the AIFM and the Company, or the Company by itself, in certain limited
circumstances, such as where the Investment Adviser is in material breach of
the Investment Advisory Agreement and such breach is not remedied. The Board,
in such circumstances, must find a replacement investment advisory services
provider for the Company and may be unable to appoint a replacement with the
necessary skills and experience on terms acceptable to the Company. If the
Investment Advisory Agreement is terminated and a suitable replacement is not
secured in a timely manner, this could have an adverse effect on the value of
the Portfolio, the Company's financial condition, results of operations and
prospects, with a consequential adverse effect on the returns to shareholders
and the market value of the shares.
The Company has delegated responsibility for day-to-day management of the
investments comprised in the Company's portfolio to the AIFM (which has in
turn delegated portfolio management activities to the Investment Adviser). The
Directors have responsibility for exercising supervision of the AIFM and the
Investment Adviser.
Company Secretary and Administrator
Effective from 1 January 2025, the Board appointed NSM Funds (UK) Limited as
the Company Secretary and Administrator.
Custodian
The Northern Trust Company has been appointed by the Company to act as
Custodian of certain assets.
Appointment of service providers
The Board has undertaken an annual review of its service providers through the
Management Engagement Committee, to ensure that their continued appointment is
in the best long-term interests of the Company's shareholders. The last review
was held in November 2025.
Capital structure, voting rights and restrictions
At the financial year end, the Company's issued share capital comprised
192,514,986 Ordinary Shares of 1p nominal value each.
Each Ordinary Share held entitles the holder to one vote. All Ordinary Shares
carry equal voting rights and there are no restrictions on those voting
rights. Voting deadlines are stated in the Notice of the AGM and Form of Proxy
and are in accordance with the Companies Act 2006.
Restrictions
There are no restrictions on the transfer of shares, nor are there any
limitations or special rights associated with regards to control attached to
the Ordinary Shares. There are no agreements between holders regarding their
transfer known to the Company, no restrictions on the distribution of
dividends and the repayment of capital, and no agreements to which the Company
is a party that might affect its control following a successful takeover bid.
Results
The Company's revenue profit after tax for the year amounted to £8,181,000
(31 December 2024: £6,190,000). The Company made a capital profit after tax
of £55,887,000 (31 December 2024: £42,340,000). Therefore, the total profit
for the year of the Company was £64,068,000 (31 December 2024: £48,530,000).
Substantial Shareholders
As at the year ended 31 December 2025, the Directors have been formally
notified of the following interests in the Company's Ordinary Shares,
comprising 3% or more of the issued share capital of the Company, in
accordance with Disclosure Guidance and Transparency Rule 5.1.2:
Shareholder Holding Percentage Held* Date Notified
Rosenwald Capital Management, Inc. 38,460,001 19.98 2 December 2021
1607 Capital Partners, LLC 14,707,873 7.63 27 October 2023
Azvalor Asset Management SGIIC SA** 9,751,318 5.07 13 October 2025
Evelyn Partners Limited 5,939,664 3.09 12 October 2023
* Based on the number of Ordinary Shares in issue as at 31
December 2025.
** Since the year end, the Company has been notified that as of 5 March
2026, Azvalor Asset Management SGIIC SA held 12,080,321 shares, representing
6.20% of the Company's issued share capital.
Political donations
There were no donations made during the financial year to 31 December 2025.
Settlement of Ordinary Share transactions
Ordinary Share transactions in the Company are settled by the CREST share
settlement system.
Appointment of auditor
The Company's Auditor, BDO LLP, having expressed their willingness to continue
in office as Auditor, will be put forward for re-appointment at the Company's
AGM and the Board will seek authority to determine their remuneration for the
forthcoming year.
Going concern
The Directors have adopted the going concern basis in preparing the financial
statements.
The Directors do not foresee any immediate material risk to the Company's
investment portfolio, however, a prolonged and deep market decline could lead
to falling values in the underlying business or interruptions to cash flow.
The following is a summary of the Directors' assessment of the going concern
status of the Company.
The Company's ability to continue as a going concern for the period assessed
by the Directors, being at least 12 months from the date the financial
statements were authorised for issue.
In assessing the Company's ability to continue as a going concern, the
Directors undertook a detailed operational and financial review, including the
consideration of the Company's liquidity and ability to meet its liabilities
as they fall due.
The market and operational risks and financial impact faced by the company
including those as a result of the continuing conflicts in Ukraine and the
Middle East, and economic uncertainties from changing tariff policies were
discussed by the Board, with updates on operational resilience received from
the Investment Adviser, Administrator and other key service providers. The
Board was satisfied that the key service providers have the ability to
continue to operate. Further details on the impact of the market, liquidity
and credit risks and how they are managed are disclosed in note 15 to the
Accounts.
The Directors have a reasonable expectation that the Company has adequate
resources to continue in operational existence for at least twelve months from
the date of this report. In reaching this conclusion, the Directors have
considered the liquidity of the Company's portfolio of investments as well as
its cash position, income and expense flows under all stress scenarios. The
Company's net assets at 31 December 2025 were £430,619,000 (31 December 2024:
£365,442,000). As at 31 December 2025, the Company held £9,947,000 (31
December 2024: £19,889,000) in cash. The total expenses for the year ended 31
December 2025 were £4,642,000 (31 December 2024: £4,363,000). The ongoing
charges ratio represented approximately 1.12% (31 December 2024: 1.18%) of
average net assets during the year. At the date of approval of this document,
based on the aggregate of investments and cash held, the Company has
substantial operating expenses cover.
Auditor information
Each of the Directors at the date of the approval of this report confirms
that:
· so far as the Director is aware, there is no relevant audit
information of which the Company's Auditor is unaware; and
· the Director has taken all steps that he/she ought to have taken
as Director to make himself/herself aware of any relevant information and to
establish that the Company's Auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the
provisions of Section 418 of the Companies Act 2006.
Shareholder engagement
The Board is mindful of the importance of engaging with the Company's
shareholders to gauge their views on topics affecting the Company. The Company
reports formally to shareholders twice a year and meetings with key investors
are held as required. The key discussion points of such meetings are relayed
for the Board to consider further.
Results of AGMs are announced by the Company promptly after the relevant
meeting and published on the Company's website. Additionally, other notices
and information are provided to shareholders on an ongoing basis through the
Company's website to assist in keeping shareholders informed, such as the
monthly factsheets.
This year, the Company's AGM will be held on 4 June 2026 and the Chairman's
Statement and the AGM Notice sets out the arrangements for the meeting.
Annual General Meeting
The following information is important and requires your immediate attention.
If you are in any doubt about the action you should take, you should seek
advice from your stockbroker, bank manager, solicitor, accountant, or other
financial adviser authorised under the Financial Services and Markets Act 2000
(as amended) ("FSMA") if you are resident in the United Kingdom or, if not,
another appropriately authorised independent financial adviser.
Resolutions relating to the following items of special business will be
proposed at the AGM to be held at Prince Philip House, 3 Carlton House
Terrace, London, SW1Y 5AG on Thursday 4 June 2026 at 12:30 p.m.
Renewal of general authority to issue Ordinary Shares and to dis-apply
pre-emption rights
At the forthcoming AGM, the Board is seeking authority to allot up to a
maximum of 38,962,997 Ordinary Shares (representing approximately 20% of the
Ordinary Shares in issue at the date of this document) and to disapply
pre‑emption rights when allotting those Ordinary Shares at the forthcoming
AGM. Authority granted under both resolutions will expire at the conclusion of
the AGM to be held in 2027 unless renewed prior to this date via a General
Meeting. The full text of resolutions 11 and 13 is set out in the Notice of
Meeting.
The authority granted by shareholders to issue Ordinary Shares will provide
flexibility to grow the Company and further expand the Company's list of
assets. Ordinary Shares will only be issued at a premium to the NAV
(cum income) after the costs of issue. Ordinary Share issues are at the
discretion of the Board.
During the year ended 31 December 2025 the Company issued 3,373,282 Ordinary
Shares.
Renewal of general authority to purchase Ordinary Shares
During the year ended 31 December 2025, the Company did not utilise its
authority to purchase its own shares.
The existing authority to make market purchases will expire at the conclusion
of the 2026 AGM of the Company. The Directors recommend that a new authority
to purchase up to 29,202,766 Ordinary Shares (subject to the condition that
not more than 14.99% of the Ordinary Shares in issue, excluding treasury
shares, at the date of this document are purchased) be granted and a
resolution to that effect will be put to the AGM. Any Ordinary Shares
purchased will either be cancelled or, if the Directors so determine, held in
treasury. The full text of resolution 15 is set out in the Notice of Meeting.
The Companies Act 2006 permits companies to hold shares acquired by way of
market purchase as treasury shares, rather than having to cancel them. This
provides the Company with the ability to re-issue Ordinary Shares quickly and
cost effectively, thereby improving liquidity, and providing the Company with
additional flexibility in the management of its capital base. No Ordinary
Shares will be sold from treasury at a price less than the (cum-income) NAV
per existing Ordinary Share at the time of their sale unless they are first
offered pro rata to existing shareholders. At the period end the Company did
not hold any shares in treasury.
Unless otherwise authorised by shareholders, Ordinary Shares will not be
issued at less than NAV and Ordinary Shares held in treasury will not be sold
at less than NAV.
Notice of general meetings
Resolution 16 in the notice to the AGM is required to reflect the requirements
of the Shareholder Rights Directive. The Company is currently able to call
General Meetings, other than an AGM, on 14 clear days' notice and would like
to preserve this ability. To be able to do so, shareholders must have given
their prior approval. Such approval, which would be effective until the
Company's next AGM, when it is intended that a similar resolution will be
proposed. The Company will ensure that it offers the facility for shareholders
to vote by electronic means, and that this facility is accessible to all
shareholders, if it is to call general meetings on 14 days' notice. Short
notice of this kind will be used by the Board only under appropriate
circumstances.
Recommendation regarding resolutions
The Directors consider that all the resolutions to be considered at the AGM
are in the best interests of the Company and its shareholders as a whole and
are likely to promote its long-term success. The Directors unanimously
recommend that shareholders vote in favour of the resolutions as they intend
to do in respect of their own beneficial holdings.
Regulatory Disclosures - information to be disclosed in accordance with the UK
Listing Rule ("UKLR") 6.6.1
The UKLR requires listed companies to report certain information in a single
identifiable section of their Annual Reports or a cross-reference table
indicating where the information is set out. The Directors confirm that there
is nothing to disclose in accordance with UKLR 6.6.1.
Environmental and Social Governance ("ESG")
The Company is a closed-ended investment company which has no employees
therefore its own direct environmental impact is minimal. The Company consumed
less than 40,000kWh of energy during the year in respect of which the
Directors' Report is prepared and therefore is exempt from disclosure under
the Streamlined Energy and Carbon Reporting. It outsources all of its key
operations to reputable, third-party service providers, who are required to
comply with all relevant laws and regulations in the jurisdiction in which
they operate, and take account of social, environmental, ethical and human
rights factors, as appropriate.
The Company has no direct greenhouse gas emissions to report from its
operations, nor does it have responsibility for any other emissions-producing
sources under the Companies Act 2006 (Strategic Report and Directors' Reports)
Regulations 2013 (including those within its underlying holdings).
The Board notes that the underlying companies in which the Company invests
will have a social and environmental impact over which the Board has no
control. However, it expects its Investment Adviser to be mindful of any
associated risks when making their investments and reviews updated ESG
policies from the Investment Adviser annually. The Company aims to conduct
itself responsibly, ethically, and fairly in its investments and dealings with
stakeholders.
Modern slavery disclosure
The Company aims to act to the highest standards and is committed to
integrating responsible business practices throughout its operations. The
prevention of modern slavery is an important part of good corporate
governance. As an investment trust, the Company does not offer goods or
services to consumers and deals predominantly with professional advisers and
service providers in the financial services industry. As such the Board
considers that the Company is out of scope of the Modern Slavery Act 2015
though the Board, as a whole, notes the provisions of this Act and does
require all third-party providers to report on their compliance with the
Modern Slavery Act as part of the annual review by the Management Engagement
Committee. In addition, when selecting and retaining portfolio investments,
the Investment Adviser assesses modern slavery risks, including a review for
any evidence of human rights violations as part of the ESG risk assessment
framework. The Company believes that it is in shareholders' interests to
consider human rights issues, including modern slavery, when selecting and
retaining investments. Further details can be found in the Company's
environment, social and governance policy.
Anti-bribery and corruption
The Company's policy is to conduct all its business in an honest and ethical
manner. The Company takes a zero‑tolerance approach to bribery and
corruption and is committed to acting professionally, fairly and with
integrity in all its business dealings and relationships. The Company's policy
and the procedures are designed to support that commitment.
Prevention of the facilitation of tax evasion
The Board has a zero-tolerance approach to the facilitation of tax evasion.
The Report was approved by the Board on 7 April 2026 and signed on its
behalf: By order of the Board
For and on behalf of
NSM Funds (UK) Limited
Company Secretary
7 April 2026
Corporate Governance Statement
This Corporate Governance statement forms part of the Directors' Report.
The UK Listing Rules and the Disclosure Guidance and Transparency Rules of the
UK Listing Authority require listed companies to disclose how they have
applied the principles and complied with the provisions of The UK Corporate
Governance Code 2024 (the "UK Code"), as issued by the Financial Reporting
Council ("FRC"). The UK Code can be viewed on the FRC's website.
The Board has carefully considered the principles and provisions outlined in
the AIC Code of Corporate Governance 2024 (referred to as the "AIC Code").
This code addresses matters covered by the UK Code while also providing
additional provisions relevant to the Company's specific context.
The Board believes that reporting against the AIC Code, which has received
endorsement from the Financial Reporting Council ("FRC"), offers more
pertinent information for shareholders.
You can find the AIC Code on the AIC website. It includes an explanation of
how the AIC Code adapts the Principles and Provisions from the UK Code to suit
investment companies.
The Company has diligently adhered to the Principles and Provisions set forth
in the AIC Code.
Given the Company's status as an externally managed investment company, the
Board has determined that certain provision such as those related to the role
of executive directors, remuneration, and the need for an internal audit
function are not applicable. This is because all day-to-day management and
administrative functions are outsourced to third-party service providers,
resulting in the absence of executive directors, employees, or internal
operations within the company.
The Board has concluded that the Annual Report for the year ended 31 December
2025, taken as a whole, is fair, balanced and understandable and provides the
information necessary for shareholders to assess the Company's position and
prospects, performance, business model and strategy.
Governance Structure Snapshot
The Board
Composition
At the date of this report, and as illustrated above, the Board consists of
six non-executive Directors. The intention of the Board over the longer term
is to reduce the number of Directors back to a maximum of five, which the
Board believes is the appropriate number of directors for an investment
company of the Company's nature and size. All of the Directors are independent
of the Investment Adviser and AIFM and are able to allocate sufficient time to
the Company to discharge their responsibilities effectively. The Directors
have a broad range of relevant experience to meet the Company's requirements,
and their biographies are given below.
Rosemary Morgan - Appointed 14 November 2019
Non-Executive Director, Chairman of the Board, and Management Engagement
Committee
Until February 2024, Rosemary was an independent director and Chairman of
JPMorgan India Growth & Income plc.
Until 2022, she was a Senior Independent non-executive Director of Schroder
Asia Pacific Investment Trust, where she was the Chairman of the Audit and
Risk Committee.
Rosemary studied Japanese at the Australian National University in Canberra
before being awarded the Monbusho Scholarship at Kobe University in Japan and
then studying for a Master of Arts in Japanese Literature at Harvard
University in the United States.
After university, Rosemary worked as a Japanese equity fund manager for 16
years at John Govett before joining the institutional client team at Fidelity
International and then moving to the Royal Bank of Scotland as Head of Asia
and Emerging Markets (Multi Manager Funds), where she managed long only and
alternative funds of funds, specialising in Japan and Emerging Markets.
Chetan Ghosh - Appointed 22 October 2019
Non-Executive Director and Chair of the Audit Committee
Chetan is a member of the Outsoured Chief Investment Officer ("OCIO")
Solutions Team at Schroders. Before this he was Chief Investment Officer for
the Centrica pension scheme and was responsible for providing support to the
directors of the investment committee. His role covered investment strategy
considerations, asset class and manager research, and liaison with the
investment advisers.
In 2022, Chetan and his team joined Schroders to provide a fully tailored OCIO
service to the Centrica pension scheme.
Prior to joining Centrica in 2009, Chetan worked in a number of roles, ranging
from pensions actuary at Towers Perrin to investment consultant at Aon Hewitt
and Lane Clark & Peacock. Whilst at financial services firm Alexander
Forbes, Chetan developed a fiduciary management offering to improve client
governance structures.
Chetan has a first-class degree in Mathematics from Kings College London. He
is based in London, UK.
Rachel Hill - Appointed 22 October 2019
Non-Executive Director and Chair of the Nomination and Remuneration Committee
Since 2006, Rachel has been a Director of Dragon Capital Markets (Europe)
Limited and has been responsible for the European marketing of LSE listed
Vietnam Enterprise Investments Ltd and the Vietnam Equity (UCITS) fund. Rachel
has over 30 years of experience in respect of equity sales in Asian markets.
In addition, Rachel also currently serves on the board of Quaero Capital
Luxembourg Fund, a Luxembourg regulated UCITS platform with various sub funds
investing in equities and bonds.
Rachel holds a BA (Hons) MA in Natural Science from Trinity Hall, Cambridge
University and is also a Chartered Member of the Chartered Institute for
Securities and Investment. She is based in Bath, UK.
Alicia Ogawa - Appointed 14 November 2019
Non-Executive Director and Senior Independent Director
Alicia Ogawa has been a consultant on Japan strategies to two of the largest
U.S. based activist hedge funds and is an advisor to several Japan-focused
activist funds. In 2023, she was a member of the New Governance Task Force at
KT (Korea Telecom), and until June 2023, she ran the Project on Japanese
Corporate Governance and Stewardship at Columbia Business School. She was also
a director of the Tokyo-based activist fund Misaki Capital.
Alicia is an advisor at Questhub, a Tokyo-based governance advisory firm. She
spent a decade as an assistant adjunct Professor at Columbia's School of
International and Public Affairs running graduate seminars on ESG issues.
Alicia acts as a Senior Advisor to a US-based law firm Squire Patton Boggs and
provides guidance to Japanese Companies operating in the US on strategies to
deal with the new US administration. Between 2000-2006, she was managing
director at Lehman Brothers in New York City, where she was responsible for
managing the firm's global equity research product.
Prior to joining Lehman Brothers, Alicia spent 15 years in Tokyo, where she
was a top-rated bank analyst and director of research for Nikko Citigroup.
Alicia is currently a member of the board of directors of the Maureen and Mike
Mansfield Foundation, and a member of the board of directors of Pure Earth, a
global NGO dedicated to addressing lead and mercury pollution. She graduated
from Barnard College and earned a master's degree in international affairs at
Columbia University School of International and Public Affairs. She is based
in New York, USA.
Ayako Hirota Weissman - Appointed 14 November 2019
Non-Executive Director
Aya is a Senior Vice President, Senior Portfolio Manager and director of Asia
Strategy at Horizon Kinetics LLC. Aya has over 40 years of investment
experience managing equity portfolios in the US and Asian markets. Prior to
joining Horizon Kinetics LLC, she was the founder and Chief Investment officer
at AS Hirota Capital Management, LLC.
Aya's prior experiences include acting as a portfolio manager specialising in
Japanese securities for Kingdon Capital Management, LLC, and as a partner and
Portfolio Manager of Feirstein Hirota Japan Partners. In addition, Aya was a
Managing Director and Senior Portfolio manager in the US large cap value
equity division at Salmon Smith Barney Asset Management, where she was a
founding member.
Aya is a former member of the board of Toshiba Corporation, where she was a
chairperson of the compensation committee. She was also a board member of SBI
Holdings.
Aya received an MBA from the International Institute for Management
Development (IMD) in Lausanne, Switzerland and a BA in Liberal Arts from
International Christian University (ICU) in Tokyo, Japan. She studied at Chung
Chi College at Chinese University of Hong Kong as a Japanese Ministry of
Education Scholar. She is a CFA charter holder.
Claire Boyle - Appointed 10 October 2023
Non-Executive Director
Claire Boyle was an independent non-executive director of Abrdn Japan
Investment Trust plc from 1 February 2019 to 10 October 2023 and Chair of the
Audit and Risk Committee from October of 2019. She is currently the Chair of
Life Science REIT plc, Chair of Fidelity Special Values plc and a
non-executive director and Chair of the Audit and Risk Committee of The Monks
Investment Trust PLC.
Claire is a Fellow of the Institute of Chartered Accountants in England and
Wales, qualifying in 1993 whilst working in litigation support at Coopers
& Lybrand. She has over 17 years' experience working in finance and equity
investment management, working on funds over a wide range of sectors for
international corporate, Government, State and retail clients, including unit
and investment trusts. She started her investment career on the UK research
desk at Robert Fleming, was a partner at Oxburgh Partners LLP with
responsibility for their European Equity Hedge Fund, and prior to that a
European Equity Fund Manager at American Express Asset Management, where her
role included both equity investment and business development.
Re-election of Directors
As stated in the Prospectus of 2023 and the Annual Report for 2023, the Board
had committed to reduce its size to 5 Directors by the AGM in 2026. In line
with the Board's intention to reduce the number of Directors back to a maximum
of five; Claire Boyle will stand down prior to the AGM in 2026, returning the
number of Directors to five. The Board recommends the reappointment of all
other Directors for the reasons highlighted above and in the performance
appraisal section of this report.
The Directors have appointment letters which do not provide for any specific
term. Copies of the Directors' appointment letters are available on request
from the Company Secretary. Upon joining the Board, any new Director will
receive an induction, and relevant training is available to Directors on an
ongoing basis.
Role of the Board
All Board members are independent non-executive Directors, who continue to be
independent of the Investment Adviser. The Board is responsible for the
governance of the Company, notwithstanding any delegation of responsibilities
to third parties. It has oversight over the management and conduct of the
Company's business, strategy and development. The Board determines the
Investment Objective and Investment Policy as well as risk appetite and has
overall responsibility for the Company's activities, including review of
investment activity and performance. The Board ensures the maintenance of a
sound system of internal controls and risk management (including financial,
operational and compliance controls) and reviews the overall effectiveness of
systems in place. The Board is responsible for approval of any changes to the
capital, corporate and/or management structure of the Company. The Board
Members offer strategic guidance and specialist advice, whilst providing
constructive and effective challenge, especially to the decisions of the
Investment Adviser. The Board scrutinises and assesses the performance of
third-party service providers (including the Investment Adviser and AIFM).
The Board's overriding focus is to promote the sustainable long-term success
of the Company, to deliver value for Shareholders and contribute to wider
society. The Board does not routinely involve itself in day-to-day business
decisions. The AIFM is responsible for the risk management of the Company
pursuant to AIFMD and the Investment Adviser for portfolio management.
Board Committees
The Company has three Committees to assist with its operations: the Audit
Committee, the Nomination and Remuneration Committee and the Management
Engagement Committee. Each Committee's delegated responsibilities are clearly
defined in formal terms of reference, which are reviewed at least annually and
are available on the Company's website. The Board decides upon the membership
and chairs of its committees.
Audit Committee
All the Directors are members of the Audit Committee, which is chaired by
Chetan Ghosh. The annual report provides details of the role and composition
of the Audit Committee together with a description of the work of the Audit
Committee in discharging its responsibilities.
Nomination and Remuneration Committee
All of the Directors are members of the Nomination and Remuneration Committee,
which is chaired by Rachel Hill. The Nomination and Remuneration Committee has
been established to meet formally on at least an annual basis to consider the
fees of the non-executive Directors and for the purpose of reviewing the
performance of the Board and its committees, the remuneration of Directors and
succession planning, including identifying and putting forward candidates for
the office of Director of the Company. In September 2025, an internal
performance appraisal process was undertaken by the Nomination and
Remuneration Committee regarding the performance of the Board, its committees
and the Board Chairman. The results of the recent performance evaluation were
positive, and no material issues were identified. As stated in the Prospectus
of 2023 and the Annual Report for 2023, the Board will reduce its size to 5
Directors by the AGM in 2026. The Nomination and Remuneration Committee
considers job specifications and assesses whether candidates have the
necessary skills and time available to devote to the job.
The Board has formulated a succession plan which was reviewed and maintained
through the Nomination and Remuneration Committee to promote regular
refreshment and diversity, whilst maintaining stability and continuity of
skills and knowledge on the Board.
The Directors' Remuneration Implementation Report and Remuneration Policy is
included in the annual report.
Management Engagement Committee
All of the Directors are members of the Management Engagement Committee, which
is chaired by Rosemary Morgan. The Management Engagement Committee has been
established to conduct a formal annual review of the Investment Adviser,
assessing investment and other performance, the level and method of the
Investment Adviser's remuneration and the continued appointment of the
Investment Adviser. In 2025, the Management Engagement Committee met and
reviewed the Investment Adviser's performance and remuneration structure. The
conclusion was a recommendation by the Management Engagement Committee to the
Board that it was in the best interests of shareholders to continue with the
Investment Adviser's engagement, and that the current fee structure remained
appropriate.
In addition, the Management Engagement Committee conducted a performance
evaluation of the Company's key service providers. No material deficiencies
were noted. The Management Engagement Committee reviewed the fees payable to
other service providers to the Company and concluded they remained
appropriate.
Meeting attendance
Management Nomination and
Quarterly Audit Engagement Remuneration
Board Committee Committee Committee
Number of meetings held 4 3 1 1
Rosemary Morgan 4 3 1 1
Chetan Ghosh 4 3 1 1
Rachel Hill 4 3 1 1
Alicia Ogawa 4 3 1 1
Ayako Weissman 4 3 1 1
Claire Boyle 4 3 1 1
Noel Lamb* 1 1 N/A N/A
* Retired on 5 June 2025.
During the year, there were ad hoc Board and committee meetings to deal with
administrative matters and formal approval of documents.
Board diversity
The Company's policy is that the Board should have an appropriate level of
diversity in the boardroom, taking into account relevant skills, experience,
gender, social and ethnic backgrounds, cognitive and personal strengths. Brief
biographies of the Directors are shown in the Annual Report. The policy is to
ensure that the Company's Directors bring a wide range of knowledge,
experience, skills, backgrounds and perspectives to the Board. There will be
no discrimination on the grounds of gender, religion, race, ethnicity, sexual
orientation, age or physical ability. The overriding aim of the policy is to
ensure that the Board is composed of the best combination of people for
ensuring effective oversight of the Company and constructive support and
challenge to the Investment Adviser. Consideration is given to the
recommendations of the AIC Code, and the Board supports the recommendations of
the Hampton Alexander Review and the Parker Review.
The Board appraises its collective set of cognitive and personal strengths,
independence and diversity on an annual basis, and especially during the
recruitment process, so as to ensure it is aligned with the Company's
strategic priorities. The performance appraisal process is described below.
The Board takes account of the targets set out in the FCA's Listing Rules,
which are set out below. The Board discloses the following information in
relation to its diversity. As an externally managed investment company, the
Board employs no executive staff and therefore does not have a chief executive
officer (CEO) or a chief financial officer (CFO) - both of which are deemed
senior board positions by the FCA. However, the Board considers the Chairman
of the Board, the Chairman of the Audit 'Committee and the Senior Independent
Director to be senior positions; hence the following disclosures are made on
this basis. Furthermore, the Board has resolved that the Company's year-end
date is the most appropriate date for disclosure purposes. The following
information has been provided by each Director.
As required under UKLR 16.3.29, further detail in respect of the diversity
targets as at 30 November 2025 are provided in the tables below.
Number of
Number of Percentage senior positions
Board members* of the Board on the Board
Men 1 20% 1
Women 5 80% 2
Prefer not to say - - -
Number of
Number of Percentage senior positions
Board members* of the Board on the Board
White British or Other White
(including minority-white groups) 4 60% 2
Ethnic minority background* 2 40% 1
Prefer not to say - - -
* Based on UK census data.
Statement
The Board's composition currently meets the FCA's new targets:
· two senior positions on the Board are held by women (Board
Chairman and Nomination & Remuneration Committee Chair); and
· two individuals on the Board are from an ethnic minority
background.
The Board undertakes an appraisal of its performance, skills as well as
independence and diversity, on an annual basis and believes its current
composition is appropriate for such purposes. However, in light of the Board's
succession planning and tenure policy, or should strategic priorities change,
the Board will review and, if required, adjust its composition.
Tenure policy
It is the Board's policy that all Directors, including the Chairman, shall
normally have tenure limited to nine years from their first appointment to the
Board, except that the Board may determine otherwise if it is considered that
the continued participation on the Board of an individual Director, is in the
best interests of the Company and its shareholders. This is also subject to
the Director's re-election annually by shareholders. The Board considers that
this policy encourages regular refreshment and is conducive to fostering
diversity.
The Board has adopted Corporate Governance best practice and has a succession
plan in place. In line with the Board's intention to reduce the number of
Directors back to a maximum of five; Claire Boyle will stand down prior to the
AGM in 2026, returning the number of Directors to five.
Board and Chairman evaluation
The Directors are aware that they need to monitor and improve Board
performance continuously and recognise that this can be achieved through
regular Board evaluation, which provides a valuable feedback mechanism for
improving Board effectiveness.
During the year, the Board conducted an internal evaluation using the services
of Board Forms, an external evaluation consultancy which is independent of the
Company. The evaluation was based upon completed questionnaires covering the
Board and its Committees, individual Directors and the Chairman. The
responses, including the appraisal of the Chairman, were discussed by the
Nomination Committee. The conclusion of the internal performance evaluations
were positive and demonstrated that the Board and its Committees were
operating effectively.
Following the Company's year end, the performance of the Board, Committees,
and individual directors was evaluated though an assessment process led by an
external facilitator, Fletcher Jones Ltd. Fletcher Jones has not provided any
other services to the Company and does not have any other commercial
connections to Nippon Active Value Fund, Dalton Investments or Rising Sun
Management. This review is the first review that Fletcher Jones has conducted
for the Company.
The review process was tailored to the specific environment, operating style
and strategic goals and challenges faced by the Company. It involved each
Director completing a questionnaire, followed by private one-to-one
conversations between the external reviewer and each Director and with the
Company's Investment Managers, and the Company Secretary. The Reviewer also
observed a Board meeting, as well as a meeting of the Audit Committee. The
anonymity of the respondents was ensured throughout the process, in order to
promote an open and frank exchange of views.
The external reviewer provided a formal report of their findings, which was
considered by the Board. The report presented an objective view on the current
working of the Board as a whole, as well as the quality of contributions made
by individual Directors. The intention of the review process was to further
strengthen the working of the Board by providing an opportunity for the
objective consideration of the Board's strengths and current skills, any areas
for further development, succession planning, and any potential gaps in its
composition. The report also considered the challenges, opportunities and
strategic direction of travel anticipated over the near to medium-term. The
report's finding noted that Board of NAVF and each Committee operates well
with skill and focus on all the areas of importance. The main theme coming
through this evaluation was of a harmonious and supportive Board with a
genuinely good and positive working relationship. There was a full agenda of
issues for the Board to consider over the next 12 months, with succession
planning and Board rotation, Manager oversight, dividend policy, the continued
growth of the Company and wider strategy considerations being key themes.
Matters relating to risk management and fund oversight were discussed
proactively.
Overall, all responses and the observations suggested that this is a
well-managed, well run, and effective Board with some practical refinements
suggested, which the Board will carefully consider.
Insurance and indemnity provisions
A policy of insurance against Directors' and Officers' liabilities is
maintained by the Company. A procedure has been adopted for Directors, in the
furtherance of their duties, to take independent professional advice at the
expense of the Company.
Internal control
The AIC Code requires the Board to review the effectiveness of the Company's
system of internal controls. The Board recognises its ultimate responsibility
for the Company's system of internal controls and for monitoring its
effectiveness. The system of internal controls is designed to manage rather
than eliminate the risk of failure to achieve business objectives.
It can provide only reasonable assurance against material misstatement or
loss. The Board has undertaken a review of the aspects covered by the guidance
and has identified risk management controls in the key areas of business
objectives, accounting, compliance, operations and secretarial as being
matters of particular importance upon which it requires reports. The Board
believes that the existing arrangements, set out below, represent an
appropriate framework to meet the internal control requirements. Through these
procedures, the Directors have kept under review the effectiveness of the
internal control systems throughout the period and up to the date of this
report.
Although Provision 34 of the AIC Code (relating to an explicit declaration on
the effectiveness of material internal controls) is not yet applicable to the
Company, the Board is taking steps to work towards compliance. During the
year, the Audit Committee discussed the Company's approach to identifying
material controls, including those operated by third-party service providers,
with assurance available through controls reports and management
confirmations. This work will continue during the coming year to ensure the
Board is well positioned to make the required declaration.
Financial aspects of internal control
These are detailed in the Report of the Audit Committee.
Other aspects of internal control
The Board holds at least four regular meetings each year, plus additional
meetings as required. Between these meetings there is regular contact with the
Investment Adviser and the Company's Secretary and Administrator.
The Board has agreed policies with the Investment Adviser on key operational
issues and the Investment Adviser reports in writing to the Board on
operational and compliance issues prior to each meeting, and otherwise as
necessary. The Investment Adviser reports direct to the Audit Committee
concerning the internal controls applicable to the Investment Adviser's
dealing, investment and general office procedures.
The Directors receive quarterly updates from the Investment Adviser which
details the holdings in the portfolio and investment transactions. The
Administrator, Company Secretary and AIFM report separately in writing to the
Board concerning risks and control matters within its purview, including
internal financial control procedures and company secretarial matters.
Additional ad hoc reports are received as required and Directors have access
at all times to the advice and services of the corporate Company Secretary,
which is responsible to the Board for ensuring that Board procedures are
followed, and that applicable rules and regulations are complied with.
The contacts with the Investment Adviser and the Administrator enable the
Board to monitor the Company's progress towards its objectives and encompasses
an analysis of the risks involved. The effectiveness of the Company's risk
management and internal controls systems is monitored regularly and a formal
review, utilising a detailed risk assessment programme, takes place at least
annually. This includes consideration of relevant service provider internal
controls reports. There are no significant findings to report from the review.
Principal risks
The Directors confirm that they have carried out a robust assessment of the
Company's emerging and principal risks, including those that would threaten
its business model, future performance, solvency or liquidity. The principal
risks and how they are being managed are set out in the Strategic Report.
Voting at Investee Companies AGM or General Meetings
The Company delegates responsibility for voting to Rising Sun Management
Limited ("Rising Sun"). During the year, voting was submitted in respect of 28
investee companies. In the majority of cases, Rising Sun voted in favour of
all resolutions. In certain instances, votes were cast against specific
management resolutions where concerns were identified; however, on an overall
basis, Rising Sun's voting stance for each investee company was supportive.
Directors' Remuneration Implementation Report
The Nomination and Remuneration Committee is responsible for reviewing the
remuneration payable to the Directors taking into account the relevant
circumstances of the Company, the time commitment and relevant experience and
skills of the Board and the average fees paid to the Board of the Company's
competitors. The Nomination and Remuneration Committee is chaired by Rachel
Hill and consists of all the Directors.
The Remuneration Implementation Report for the period to 31 December 2025 has
been prepared in accordance with sections 420-422 of the Companies Act 2006.
The law requires the Company's Auditor to audit certain sections of the
Remuneration Implementation Report; where this is the case, the relevant
section has been indicated as such.
AGM approval of the Remuneration policy and remuneration implementation report
In accordance with the requirements of Schedule 8 of the Large and
Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, as
amended (the "Regulations"), the Board is required to put forward for
shareholder approval at its first AGM, and on a triennial basis thereafter, a
Remuneration Policy. Accordingly, the Remuneration Policy of the Company set
out below was proposed to shareholders via an ordinary resolution which is a
binding resolution at the AGM held on 5 June 2025. The resolution was passed
including proxies representing 99.82% of the shares voted in favour of the
resolution. Following the passing of the ordinary resolution, the provisions
set out in the below Remuneration Policy will remain in place until they are
next submitted for shareholder approval, expected to be at the Company's AGM
to be held in 2028. In the event of any proposed material variation to the
Remuneration Policy or should the Remuneration Policy or the Remuneration
Implementation Report fail at the forthcoming AGM, shareholder approval will
be sought for a proposed revised Remuneration Policy prior to its
implementation.
The Remuneration Implementation Report requires approval via an ordinary
resolution on an annual basis. This resolution is put to shareholders on an
advisory, non-binding, basis which means that, if the resolution were to fail
to attract sufficient votes in favour, the Board would continue to be entitled
to be remunerated and would not be required to amend their contractual
relationship with the Company. However, if the Remuneration Implementation
Report were to be voted down by shareholders, the Board would be required to
resubmit the Remuneration Policy to shareholders at the AGM following the AGM
at which the Remuneration Implementation Report failed.
A non-binding ordinary resolution to approve the Directors' Remuneration
Implementation Report contained in the Annual Report and Accounts for the year
ended 31 December 2025 was put forward at the AGM held on 5 June 2025. The
resolution was passed including proxies representing 99.86% of the shares
voted in favour of the resolution.
The Board takes an active role in shareholder engagement and particularly
voting outcomes. Shareholders have the opportunity to express their views and
ask questions in respect of the Remuneration Policy and Remuneration
Implementation Report at the Annual General Meeting.
Loss of office
There are no agreements in place to compensate the Board for loss of office.
Remuneration Policy
All the Directors are non-executive directors and the Company has no other
employees. The components of the remuneration package for non-executive
directors, which are contained in the Remuneration Policy are as detailed
below:
Current and future policy
Component Director Purpose of reward Operation
Annual fee Chair of the Board For services as Chair of a Plc Determined by the Nomination & Remuneration Committee
Annual fee Other Directors For services as non-executive Directors of a Plc Determined by the Nomination & Remuneration Committee
Additional fee Chair of Audit Committee For additional responsibility and time commitment Determined by the Nomination & Remuneration Committee
Expenses All Directors Reimbursement of expenses incurred in the performance of duties Submission of appropriate documentation
In accordance with the Company's Articles of Association, Board fees in
aggregate cannot exceed £400,000 per annum, unless shareholders approve via
an ordinary resolution at a General Meeting such other sum.
Directors' Service Contracts
The Directors do not have service contracts with the Company but have letters
which outline the terms of their appointment. In accordance with the Articles
and AIC Code, the Board will seek annual re-election.
Fees payable on recruitment
The Board will not pay any incentive fees to any person to encourage them to
become a Director of the Company. The Board may, however, pay fees to
external agencies to assist the Board in the search and selection of
Directors. No such external agency was engaged during the period under review.
Effective date
The Remuneration Policy is effective from the date of approval by
shareholders.
Remuneration Implementation Report (Audited)
The table below provides a single figure for the total remuneration of each
Director for the year ended 31 December 2025:
Directors Fees to Directors Fees to Change Change Change Change Change
31 December 2025
31 December 2024
from 2024
from 2023
from 2022
from 2021
from 2020
(£) (£) to 2025 to 2024 to 2023 to 2022 to 2021
Rosemary Morgan 47,000 43,800 7.2% 6.9% nil 17.1% nil
Chetan Ghosh 38,000 35,050 8.4% 6.2% nil 10.0% nil
Rachel Hill 31,700 29,535 7.3% 6.2% nil 3.0% nil
Alicia Ogawa 31,700 29,535 7.3% 6.2% nil 3.0% nil
Ayako Weissman 31,700 29,535 7.3% 6.2% nil 3.0% nil
Claire Boyle 31,700 29,535 7.3% 6.2%* n/a n/a n/a
Noel Lamb 11,551** 29,535 7.3% 6.2%* n/a n/a n/a
Total 223,351 226,525 (4.1)% 33.2% nil 7.8% nil
* Appointed on 10 October 2023.
** Resigned on 5 June 2025.
Directors receive fixed fees and are not entitled to receive from the Company:
· Performance related remuneration;
· Any benefits in kind except reasonable travel expenses in the
course of travel to attend meetings and duties undertaken on behalf of the
Company;
· Share options;
· Rewards through a long-term incentive scheme;
· A pension or other retirement benefit; or
· Compensation for loss of office.
Fees
With effect from 1 January 2026, the Board remuneration is outlined in the
table below:
Fee per annum*
Position (GBP)
Board Chairman 47,000
Director 33,000
Audit Committee Chair (additional fee) 5,000
* Following a review of the Directors' fees in November 2025, it
was decided that the fees be increased in line with the average market levels
for the Directors with effect from 1 January 2026.
Directors' indemnities
Subject to the provisions of the Companies Act 2006, the Company has agreed to
indemnify each Director against all liabilities which any Director may suffer
or incur arising out of or in connection with any claim made or proceedings
taken against him/her, or any application made by him/her, on the grounds of
his/her negligence, default, breach of duty or breach of trust in relation to
the Company or any Associated Company.
Performance
The following chart shows the performance of the Company's NAV and share price
(total return) by comparison for the period since the Company was listed,
assuming 100p was invested at the point the Company was listed. The Company
does not have a specific benchmark but has deemed the MSCI Japan Small Cap
index to be the most appropriate comparator for its performance.
Relative importance of spend on pay
The following table sets out the total level of Directors' remuneration
compared to the distributions to shareholders by way of dividends and the
operating expenses and Investment Adviser's fees and operating expenses
incurred by the Company.
Year to Year to
31 December 31 December
2025 2024 Change
£ £ %
Dividend income 11,386,000 9,125,000 24.8
Spend on Directors' fees 223,351 227,000 (1.5)
Company's operating expenses and Investment Adviser's fees 4,642,000 4,363,000 6.4
Dividends paid and payable to shareholders 10,754,000 6,147,000 74.9
The disclosure of the information in the table above is required under the
Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment)
Regulations 2013 with the exception of operating expenses which have been
included to show the total expenses of the Company.
Directors' holdings (Audited)
At 31 December 2025 and as at the date of this report, the Directors had the
following holdings in the Company. There is no requirement for Directors to
hold shares in the Company. All holdings were beneficially owned.
Ordinary Shares Ordinary Shares Ordinary Shares
As at As at As at
the date of this 31 December 31 December
Director report 2025 2024
Rosemary Morgan 41,450 41,450 41,450
Chetan Ghosh 40,000 40,000 40,000
Rachel Hill 115,791 115,791 115,791
Alicia Ogawa 25,000 25,000 25,000
Ayako Weissman 50,000 50,000 50,000
Claire Boyle nil nil nil
Noel Lamb N/A N/A 35,853
Statement
On behalf of the Board and in accordance with Part 2 of Schedule 8 of the
Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment)
Regulations 2013, I confirm that the above Remuneration Policy and
Remuneration Implementation Report summarises, as applicable, for the year to
31 December 2025:
· The major decisions on Directors' remuneration;
· Any substantial changes relating to Directors' remuneration made
during the period; and
· The context in which the changes occurred and decisions have been
taken.
Rachel Hill
Chair of the Nomination and Remuneration Committee
7 April 2026
Report of the Audit Committee
Role of the Audit Committee
The AIC Code recommends that Boards should establish an audit committee
consisting of at least three, or in the case of smaller companies, two
independent non-executive directors. The Board is required to satisfy itself
the audit committee as a whole should have competence relevant to the sector
in which the company operates. The main role and responsibilities of the Audit
Committee are set out in the Committee's terms of reference covering certain
matters described in the AIC Code. The Board considers that the Company has
complied with the provisions of the AIC Code relating to the Audit Committee
throughout the year. The terms of reference are available on the Company's
website or on request from the Company Secretary.
Composition
The Audit Committee comprises all members of the Board and is chaired by
Chetan Ghosh. All members of the Audit Committee are independent non-executive
Directors. The Board considers that, given the size of the Board, it is
appropriate for the full Board to act as the Audit Committee. The AIC Code
permits the Chairman of the Board to be a member of but not chair the Audit
Committee if they were independent on appointment. The Chairman of the Board
was independent on appointment and continues to be, and as such the Directors
feel it is appropriate for the Chairman of the Board to be a member of the
Audit Committee. The Board is satisfied that the Audit Committee as a whole
has the necessary skills, experience and knowledge relevant to the Company's
activities as an investment trust. Chetan Ghosh is considered by the Board to
have recent and relevant financial experience.
Meetings of the Audit Committee
The Audit Committee meets formally at least twice a year for the purpose,
amongst other things, of advising the Board on the appointment, effectiveness,
independence, objectivity, and remuneration of the external Auditor. The Audit
Committee monitors the integrity of the financial statements of the Company
and any formal announcements relating to the Company's financial performance,
reviewing significant financial reporting judgements contained in them. The
Audit Committee also reviews the Company's internal financial controls and its
internal control, risk management systems and reviews the whistleblowing
arrangements of the Investment Adviser, AIFM and Administrator. As part of
this process, the Audit Committee reviews reports and assurances received from
these service providers, including internal control and assurance reports, and
considers whether any significant control issues have arisen during the year.
The provision of non-audit services by the Auditor are reviewed against the
Committees policy described below.
Financial statements and significant accounting matters
The Audit Committee reviewed the financial statements and considered the
following significant accounting matters in relation to the Company's
financial statements for the year ended 31 December 2025.
Valuation and existence of investments
The Company holds the majority of its assets in quoted investments. The
existence and valuation of these investments is the most material matter in
the production of the financial statements. The Audit Committee reviewed the
procedures in place for ensuring accurate valuation and existence of
investments and discussed the valuation of the Company's investments at the
period end with the Investment Adviser and reviewed their existence with the
Administrator and other service providers. Investments are valued using
independent pricing sources and the holding quantities at the period end were
agreed to the Company's Custodian's records.
Recognition of income
Income may not be accrued in the correct period and/or incorrectly allocated
to revenue or capital. The Audit Committee reviewed the Administrator's
procedures for recognition of income and reviewed the treatment of any special
dividends receivable in the year.
Geo-politics
During the financial year under review, the Committee continued to monitor the
geopolitical landscape, including the ongoing conflict in Ukraine, tensions in
the Middle East and broader global trade and political developments. Such
events have the potential to heighten market volatility and impact investor
sentiment, which in turn may affect Company performance. The Committee also
remained attentive to inflationary pressures, interest rate movements and
foreign exchange volatility. These matters are considered as part of the
Committee's broader risk assessment and its evaluation of the Company's
ability to achieve its investment objective.
The Committee also reviewed the operational resilience of the Company's key
service providers in connection with the mitigation of the business risks
posed by geopolitical events. The Committee is satisfied that service
providers have continued to operate effectively throughout the period, with no
disruption to services or significant operational failures. The Committee has
also sought and received confirmation that relevant external providers
continue to comply with applicable sanctions regimes and regulatory
requirements.
Financial statement presentation
The Audit Committee obtained assurances from the Investment Adviser and the
Company Secretary that the financial statements had been prepared
appropriately.
Going concern
The financial statements could be prepared on an incorrect accounting basis
which might result in an incorrect valuation of financial assets and
liabilities. The Audit Committee reviewed the Company's financial resources
and concluded that it is appropriate for the Company's financial statements to
be prepared on a going concern basis as described in the Directors' Report.
Material controls
Although Provision 34 of the AIC Code (relating to an explicit declaration on
the effectiveness of material internal controls) is not yet applicable to the
Company, the Board is taking steps to work towards compliance. During the
year, the Audit Committee discussed the Company's approach to identifying
material controls, including those operated by third-party service providers,
with assurance available through controls reports and management
confirmations. This work will continue during the coming year to ensure the
Board is well positioned to make the required declaration.
Conclusion with respect to the annual report and financial statements
The Audit Committee has concluded that the annual report for the year ended 31
December 2025, 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. The Audit Committee has
reported its conclusions to the Board. The Audit Committee reached this
conclusion through a detailed review of the Annual Report and accounts,
consideration of draft versions of the report, discussions with the Investment
Adviser, Administrator and Company Secretary, and review of the external
Auditor's report and findings.
Auditor
Provision of non-audit services
The Audit Committee has put a policy in place on the supply of any non-audit
services provided by the external Auditor. Such services are considered on a
case-by-case basis and may only be provided to the Company if the provision of
such services is at a reasonable and competitive cost and does not constitute
a conflict of interest or potential conflict of interest which would prevent
the Auditor from remaining objective and independent.
No non-audit services were provided by the Auditor during the year.
Effectiveness of external audit
BDO LLP has been the Company's Auditor since inception. The Audit Committee
reviewed the audit planning and the standing, skills and experience of the
firm and the audit team. The Audit Committee also considered the independence
of BDO and the objectivity of the audit process. BDO has confirmed that it is
independent of the Company and has complied with relevant auditing standards.
No modifications were required to the external audit approach. The Audit
Committee received a presentation of the audit plan from the external Auditor
prior to the commencement of the 2025 audit and a presentation of the results
of the audit following completion of the main audit testing. Additionally, the
Audit Committee received feedback from the Investment Adviser and
Administrator regarding the effectiveness of the external audit process.
The Audit Committee is satisfied that BDO LLP has provided effective
independent challenge in carrying out its responsibilities. After due
consideration, the Audit Committee recommends the re-appointment of BDO LLP,
and their re-appointment will be put forward to the Company's shareholders at
the 2026 AGM.
Internal audit
The Audit Committee has considered the requirement for an internal audit
function and considers that this is not appropriate given the nature and
circumstances of the Company. The Audit Committee instead places reliance on
the internal control frameworks and internal audit functions of the Investment
Adviser, AIFM and Administrator, and receives regular reports on the operation
and effectiveness of those controls. The Audit Committee keeps the need for an
internal function under periodic review. The Investment Adviser reports the
key conclusions of their internal audit report to the Company's Audit
Committee.
Committee evaluation
The Audit Committee's activities fell within the scope of the review of Board
effectiveness performed in the period. Details of this process can be found
under 'Board and Chairman evaluation'.
Chetan Ghosh
Chair of the Audit Committee
7 April 2026
Statement of Directors' Responsibilities
The Directors are responsible for preparing the annual report and the
financial statements in accordance with UK adopted international accounting
standards and applicable law and regulations.
Company law requires the directors to prepare financial statements for each
financial year. Under that law the Directors are required to prepare the
Company's financial statements in accordance with UK adopted international
accounting standards. 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 for the
company for that period.
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 they have been prepared in accordance with UK
adopted international accounting standards, subject to any material departures
disclosed and explained in the financial statements;
· Prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the company will continue in
business; and
· Prepare a Directors' report, a Strategic report and Directors'
remuneration report which comply with the requirements of the Companies Act
2006.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company 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 the Companies
Act 2006.
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. The Directors are responsible for ensuring that the
annual report and accounts, taken as a whole, is fair, balanced, and
understandable and provides the information necessary for shareholders to
assess the Company's performance, business model and strategy.
Website publication
The Directors are responsible for ensuring the annual report and the financial
statements are made available on a website. Financial statements are published
on the Company website in accordance with legislation in the United Kingdom
governing the preparation and dissemination of financial statements, which may
vary from legislation in other jurisdictions. The maintenance and integrity of
the Company's website is the responsibility of the Directors. The Directors'
responsibility also extends to the ongoing integrity of the financial
statements contained therein.
Directors' responsibilities pursuant to DTR4
The Directors confirm to the best of their knowledge:
· The financial statements have been prepared in accordance with
the applicable set of accounting standards, and give a true and fair view of
the assets, liabilities, financial position and profit and loss of the
company.
· The Annual Report includes a fair review of the development and
performance of the business and the financial position of the company,
together with a description of the principal risks and uncertainties that they
face.
Directors' Statement as to the Disclosure of Information to Auditor
All of the current Directors have taken all the steps that they ought to have
taken to make themselves aware of any information needed by the Company's
Auditor for the purposes of their audit and to establish that the Auditor are
aware of that information. The Directors are not aware of any relevant audit
information of which the Auditor are unaware.
For and on behalf of the Board
Rosemary Morgan
Chairman of the Board of Directors
7 April 2026
Statement of Comprehensive Income
Year ended Year ended
31 December 2025
31 December 2024
Revenue Capital Total Revenue Capital Total
Note £'000 £'000 £'000 £'000 £'000 £'000
Gains on investments 3 - 58,885 58,885 - 46,508 46,508
Income 4 11,389 - 11,389 9,132 - 9,132
Foreign exchange losses - (375) (375) - (1,834) (1,834)
Investment adviser fees 5 (656) (2,623) (3,279) (583) (2,334) (2,917)
Other operational expenses 6 (1,363) - (1,363) (1,446) - (1,446)
Profit before finance costs and taxation 9,370 55,887 65,257 7,103 42,340 49,443
Finance costs (51) - (51) - - -
Profit before taxation 9,319 55,887 65,206 7,103 42,340 49,443
Taxation 7 (1,138) - (1,138) (913) - (913)
Profit and comprehensive income for the year 8,181 55,887 64,068 6,190 42,340 48,530
Earnings per Ordinary Share - Basic and diluted 12 4.30p 29.39p 33.69p 3.27p 22.39p 25.66p
There is no other comprehensive income and therefore the 'Profit and
comprehensive income for the year' is the total comprehensive income for the
year.
The total column of the above statement is the profit and loss account of the
Company. All revenue and capital items in the above statement derive from
continuing operations.
The supplementary revenue and capital columns, including the earnings per
Ordinary Share, are prepared in accordance with the Statement of Recommended
Practice ("SORP") issued by the Association of Investment Companies.
The notes in the Annual Report form an integral part of these financial
statements.
Statement of Financial Position
As at As at
31 December 31 December
2025 2024
Note £'000 £'000
Non-current assets
Investments held at fair value through profit or loss 3 419,934 345,593
Current assets
Cash and cash equivalents 9,947 19,889
Trade and other receivables 9 1,409 1,270
11,356 21,159
431,290 366,752
Current liabilities
Trade and other payables 10 (671) (1,310)
Total liabilities (671) (1,310)
Net assets 430,619 365,442
Equity
Share capital 11 1,925 1,891
Share premium 239,056 231,834
Capital reserve 180,937 125,050
Revenue reserve 8,701 6,667
Total equity 430,619 365,442
Net asset value per Ordinary Share 13 223.68p 193.21p
Approved by the Board of Directors on 7 April 2026 and signed on their behalf
by:
Rosemary Morgan
Chairman
Nippon Active Value Fund plc incorporated in England and Wales with registered
number 12275668.
The notes in the Annual Report form an integral part of these financial
statements.
Statement of Changes in Equity
Share
Share premium Capital Revenue
capital account reserve reserve Total
Year ended 31 December 2025 Note £'000 £'000 £'000 £'000 £'000
Closing balance as at 1 January 2025 1,891 231,834 125,050 6,667 365,442
Profit and comprehensive income for
the year - - 55,887 8,181 64,068
Issue of Ordinary Shares 11 34 7,397 - - 7,431
Share issue costs - (175) - - (175)
Dividends paid 8 - - - (6,147) (6,147)
Closing balance as at 31 December 2025 1,925 239,056 180,937 8,701 430,619
Share
Share premium Capital Revenue
capital account reserve reserve Total
Year ended 31 December 2024 Note £'000 £'000 £'000 £'000 £'000
Opening balance as at 1 January 2024 1,891 231,834 82,710 3,503 319,938
Profit and comprehensive income for
the year - - 42,340 6,190 48,530
Dividends paid 8 - - - (3,026) (3,026)
Closing balance as at 31 December 2024 1,891 231,834 125,050 6,667 365,442
The capital reserve as at 31 December 2025 includes realised gains of
£72,211,000 (31 December 2024: realised gains of £67,021,000).
The revenue reserve and realised element of the capital reserve represents the
amount of the Company's retained and distributable reserves.
The notes in the Annual Report form an integral part of these financial
statements.
Statement of Cash Flows
Year ended Year ended
31 December 31 December
2025 2024
Note £'000 £'000
Operating activities cash flows
Profit before finance costs and taxation* 65,257 49,443
Adjustment for:
Gains on investments 3 (58,885) (46,508)
Foreign exchange losses 375 1,834
Decrease/(increase) in other receivables 32 (177)
Increase/(decrease) in other payables 40 (56)
Tax withheld on overseas income 7 (1,138) (913)
Net cash flow from operating activities 5,681 3,623
Investing activities cash flows
Purchase of investments 3 (61,400) (163,798)
Sale of investments 3 45,094 162,667
Net cash flow used in investing activities (16,306) (1,131)
Financing activities cash flow
Proceeds from issue of Ordinary Shares 11 7,431 -
Share issue costs (175) -
Dividends paid 8 (6,147) (3,026)
Bank loans drawn 4,957 -
Bank loans repaid (4,814) -
Loan interest and other charges paid (51) -
Effect of foreign exchange movement (143) -
Net cash flow from/(used in) financing activities 1,058 (3,026)
Decrease in cash and cash equivalents (9,567) (534)
Effect of exchange rate changes on cash and cash equivalents (375) (1,834)
Cash and cash equivalents at start of year 19,889 22,257
Cash and cash equivalents at end of year 9,947 19,889
* Cash inflow from dividends received for the year is £10,074,000
(31 December 2024: £7,766,000).
The notes in the Annual Report form an integral part of these financial
statements.
Notes to the Accounts
1. GENERAL INFORMATION
The Company is a closed-ended investment company incorporated on 22 October
2019 in England and Wales with registered number 12275668 and registered as an
investment company under Section 833 of Companies Act 2006, as amended from
time to time. On 21 February 2020, the Company's shares were admitted to the
Specialist Fund Segment of the Main Market of the London Stock Exchange. On
the same day, trading of the Ordinary Shares commenced on the London Stock
Exchange. On 11 October 2023, the Company's Ordinary Shares were admitted to
the Official List of the FCA and trading on the main market for listed
securities of the London Stock Exchange.
The investment objective of the Company is to provide shareholders with
attractive long-term capital growth primarily through the active management of
a focused portfolio of quoted companies that have the majority of their
operations in, or revenue derived from, Japan, or a majority of whose
consolidated net assets are held in Japan, or that are included in the TOPIX,
and that have been identified by the Investment Adviser as being undervalued.
The principal activity of the Company is that of an investment trust company
within the meaning of section 1158 of the Corporation Tax Act 2010.
FundRock Management Company (Guernsey) Limited acts as the Company's
Alternative Investment Fund Manager (the "AIFM") for the purposes of The UK's
implementation of Directive 2011/61/EU of the European Parliament and of the
Council of 8 June 2011 on Alternative Investment Fund Managers, together with
Commission Delegated Regulation (EU) No. 231/2013 which forms part of UK law
by virtue of the European Union (Withdrawal) Act 2018, and any transposing
legislation incorporating the same into UK law (including, but not limited to,
the UK Alternative Investment Fund Managers Regulations 2013 (SI 2013/1773),
as amended by The Alternative Investment Fund Managers (Amendment etc.) (EU
Exit) Regulations 2019), all as may be amended or supplemented from time to
time.
The Company's Investment Adviser is Rising Sun Management Limited.
NSM Funds (UK) Limited, the Company's appointed Administrator (the
"Administrator"), provides administrative and company secretarial services to
the Company under the terms of an administration agreement between the Company
and the Administrator.
The Company's registered office is 4th floor, 46-48 James Street, London W1U
1EZ.
2. BASIS OF PREPARATION AND MATERIAL ACCOUNTING POLICIES
a) Basis of preparation
Statement of compliance
The financial statements have been prepared in accordance with UK adopted
international accounting standards.
The financial statements have also been prepared as far as is relevant and
applicable to the Company in accordance with the Statement of Recommended
Practice ("SORP") issued by Association of Investment Companies ("AIC") in
July 2022.
Going Concern
The Directors have adopted the going concern basis in preparing the financial
statements. The Directors do not foresee any immediate material risk to the
Company's investment portfolio, however, a prolonged and deep market decline
could lead to falling values in the underlying business or interruptions to
cash flow. The following is a summary of the Directors' assessment of the
going concern status of the Company.
The Directors have assessed the Company's ability to continue as a going
concern for the period under review, being at least 12 months from the date on
which the financial statements are authorised for issue.
The assessment took into consideration the risks and impact of actual and
emerging risks such as those relating to the macroeconomic political and
geopolitical environment including the continuing conflicts in Ukraine and the
Middle East and trade tariffs. Further details on the impact of the market,
liquidity and credit risks and how they are managed are disclosed in note 15
to the Accounts.
The Company is subject to a continuation vote in 2027. Having regard to the
Company's performance and track record, the Board are confident that the
continuation vote will be passed by the shareholders at the 2027 AGM.
The Directors have a reasonable expectation that the Company has adequate
resources to continue in operational existence for at least twelve months from
the date of this report. In reaching this conclusion, the Directors have
considered the liquidity of the Company's portfolio of investments as well as
its cash position, income and expense flows. The Company's net assets at 31
December 2025 were £430,619,000 (31 December 2024: £365,442,000). As at 31
December 2025, the Company held £9,947,000 (31 December 2024: £19,889,000)
in cash. The total expenses for the year ended 31 December 2025 were
£4,642,000 (31 December 2024: £4,363,000). The ongoing charges ratio
represented approximately 1.12% (31 December 2024: 1.18%) of average net
assets during the year. At the date of approval of this document, based on the
aggregate of investments and cash held, the Company has substantial operating
expenses cover.
Use of estimates and judgements
The preparation of the financial statements and the manner in which they are
presented requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. Actual results may differ from these
estimates. See below paragraph for judgement around determination of the
functional and presentation currency.
Estimates and underlying assumptions are reviewed on an on-going basis.
Revisions to accounting estimates are recognised in the year in which the
estimates are revised and in any future periods affected.
Fair value measurement and levelling of investments
Investments are measured at fair value in accordance with IFRS 13 and
classified within the fair value hierarchy (Levels 1, 2 or 3) based on the
lowest level significant input.
Judgement is required in selecting appropriate valuation techniques and
determining whether inputs are observable for the purposes of measurement and
classification within the fair value hierarchy.
Where investments are not quoted in an active market, fair value may be
determined by reference to quoted prices in inactive markets or to observable
market data for similar instruments (Level 2). Where observable inputs are not
available, valuation techniques incorporating unobservable inputs, such as
discount rates, forecast cash flows and credit assumptions, are applied (Level
3).
Classification within Level 3 involves significant estimation uncertainty, and
changes in key assumptions could materially affect carrying values. Further
details of hierarchy classification are disclosed in note 3.
Basis of measurement
The financial statements have been prepared on the historical cost basis
except for financial instruments at fair value through profit or loss, which
are measured at fair value.
Functional and presentation currency
The financial statements are presented in sterling, which is the Company's
functional currency. The Company's investments are denominated in Japanese
yen, however, the Company's shares are issued in sterling. In addition, a
substantial majority of the Company's expenses are paid in sterling. It is
also expected that the Company's dividend shall be declared and paid in
sterling. All financial information presented in sterling has been rounded to
the nearest thousand pounds.
The Company is required to identify its functional currency, being the
currency of the primary economic environment in which the Company operates.
The Board, having regard to the currency of the Company's share capital and
the predominant currency in which its shareholders operate, has determined
that sterling is the functional currency. Sterling is also the currency in
which the financial statements are presented.
New standards, amendments and interpretations adopted from 1 January 2025
The following amendment is effective for the year ended 31 December 2025 and
has been adopted by the Company.
Standard, amendment or interpretation Effective for annual periods beginning on or after
IAS 21 - Lack of Exchangeability (Amendments to IAS 21 The Effects of Changes 1 January 2025
in Foreign Exchange Rates)
The amendments clarify when a currency is exchangeable into another currency
and specify how an entity estimates the spot exchange rate when
exchangeability is lacking, together with related disclosures. The Directors
have assessed the impact of these amendments and concluded that they did not
have a material impact on the Company's financial statements for the year
ended 31 December 2025, as the Company's transactions and exposures are
predominantly denominated in currencies that are readily exchangeable.
There are no other standards, amendments to standards or interpretations that
are effective for annual reporting periods beginning on or after 1 January
2025 that have a material effect on the financial statements of the Company.
New Standards, amendments and interpretations issued but not yet effective
Certain new accounting standards, amendments to accounting standards and
interpretations have been published that are not mandatory for 31 December
2025 reporting periods and have not been early adopted by the Company.
Standard, amendment or interpretation Effective for annual periods beginning on or after
IFRS 18 - Presentation and Disclosure in Financial Statements 1 January 2027
In April 2024, the IASB issued IFRS 18 - Presentation and Disclosure in
Financial Statements, which introduces new requirements to improve the
presentation and disclosure of financial performance. The standard introduces
defined categories and subtotals in the statement of profit or loss, enhanced
requirements for management-defined performance measures, and more structured
principles for the aggregation and disaggregation of information in the
financial statements. IFRS 18 is effective for annual reporting periods
beginning on or after 1 January 2027.
Amendments to the Classification and Measurement of Financial Instruments - 1 January 2026
Amendments to IFRS 9 and IFRS 7
In May 2024, the IASB issued Amendments to the Classification and Measurement
of Financial Instruments (Amendments to IFRS 9 and IFRS 7). The amendments
clarify certain aspects of the classification and measurement requirements in
IFRS 9, including the assessment of contractual cash flow characteristics
(SPPI) and the timing of recognition and derecognition of financial assets and
liabilities, and introduce related disclosure requirements in IFRS 7. The
amendments also provide an optional approach for determining the
classification of liabilities settled via electronic cash transfer systems.
The amendments are effective for annual reporting periods beginning on or
after 1 January 2026.
IFRS 19 - Subsidiaries without Public Accountability: Disclosures 1 January 2027
In May 2024, the IASB issued IFRS 19 - Subsidiaries without Public
Accountability: Disclosures. The standard permits eligible subsidiaries to
apply reduced disclosure requirements while applying the recognition and
measurement requirements of IFRS Accounting Standards, with the aim of
reducing disclosure burden without reducing the usefulness of financial
information. IFRS 19 is effective for annual reporting periods beginning on or
after 1 January 2027.
Contracts Referencing Nature-dependent Electricity - Amendments to IFRS 9 and 1 January 2026
IFRS 7
In December 2024, the IASB issued Contracts Referencing Nature-dependent
Electricity (Amendments to IFRS 9 and IFRS 7). The amendments provide
clarification on the application of the own-use requirements, hedge accounting
and related disclosure requirements for contracts that reference
nature-dependent electricity. The amendments are effective for annual
reporting periods beginning on or after 1 January 2026.
Annual Improvements to IFRS Accounting Standards (2024) 1 January 2026
In 2024, the IASB issued Annual Improvements to IFRS Accounting Standards
(2024), which comprise a collection of minor amendments to a number of IFRS
Accounting Standards intended to clarify wording or correct relatively minor
unintended consequences. The amendments are effective for annual reporting
periods beginning on or after 1 January 2026.
b) Material accounting policies
The following accounting policies have been applied consistently throughout
the reporting year.
Investments
Upon initial recognition, investments are classified by the Company "at fair
value through profit or loss". They are accounted for on the date they are
traded and are included initially at fair value which is taken to be their
cost. Subsequently quoted investments are valued at fair value, which is the
bid market price, or if bid price is unavailable, last traded price on the
relevant exchange. Subsequently, investments are revalued at fair value, which
is the bid market price for listed investments over the time until they are
sold; any unrealised gains/losses are included in the fair value of the
investments. Investments are derecognised on the trade date of their disposal,
which is the point where the Company transfers substantially all the risks and
rewards of the ownership of the financial asset.
Changes in the fair value of investments held at fair value through profit or
loss and gains or losses on disposal are included in the capital column of the
Statement of Comprehensive Income within "gains on investments".
Unquoted investments are classified as Level 3 under IFRS 13 where observable
market prices are not available. Such investments are valued at fair value in
accordance with IFRS 13 and recognised valuation techniques.
An independent external valuation agent, appointed by the Board, performs
valuations of unquoted holdings. AIFM then oversees the valuation process,
reviews draft valuation reports, challenges key assumptions and methodologies,
and recommends final valuations for inclusion in the Company's NAV. The Board
retains ultimate responsibility for the valuation framework and oversight of
Level 3 investments.
Valuations are performed on a half-yearly basis in line with the Company's
reporting cycle. The valuation agent prepares reports using recognised
valuation methodologies appropriate to the nature and stage of each investee
company. These may include discounted cash flow analysis, comparable company
multiples, recent transaction prices (adjusted where necessary) and net asset
value approaches. The methodology selected reflects the availability and
reliability of financial information and relevant market data. The AIFM
undertakes a detailed review of each valuation, including analysis of key
inputs and assumptions, assessment of movements compared with prior periods,
and consideration of relevant market or company-specific developments.
Material valuation changes, methodological adjustments or significant
judgements are discussed with the valuation agent and, where appropriate,
escalated to the Board. At the year end, additional procedures are performed
to assess whether any post-reporting date events or developments require
adjustment or disclosure, ensuring that valuations reflect all material
information available up to the date of approval of the financial statements.
The valuation agent operates independently of the investment decision-making
process. Any actual or potential conflicts of interest are identified and
appropriately managed. The valuation policy is reviewed at least annually and
approved by the Board.
Taxation
Investment trusts which have approval under Section 1158 of the Corporation
Tax Act 2010 are not liable for taxation on capital gains. The Company has
been granted approval as an Investment Trust by HMRC.
Irrecoverable withholding tax is recognised on any overseas dividends on an
accruals basis using the applicable rate for the country of origin.
Segmental reporting
The Chief Operating Decision Maker, which is the Board, is of the opinion that
the Company is engaged in a single segment of business. The financial
information used by the Chief Operating Decision Maker to manage the Company
presents the business as a single segment.
Dividends payable
Dividends payable to shareholders are recognised in the year of the
ex-dividend date.
Income
Income includes investment income from financial assets at fair value through
profit or loss and finance income. Investment income from financial assets at
fair value through profit or loss is recognised in the Statement of
Comprehensive Income within investment income when the Company's right to
receive payments is established.
Dividend income is presented gross of non-recoverable withholding taxes, which
are disclosed separately in the Statement of Comprehensive Income.
Dividends receivable arising from companies within the United Kingdom are
classified as UK dividend income and all other income is classified as
overseas dividend income.
Special dividends are assessed on their individual merits and may be credited
to the Statement of Comprehensive Income as a capital item if considered to be
closely linked to reconstructions of the investee company or other capital
transactions.
Other income comprises interest earned on cash held on deposit. Other income
is recognised on a receipt basis.
Expenses
All expenses are accounted for on accruals basis. In respect of the analysis
between revenue and capital items presented within the Statement of
Comprehensive Income, the Investment Adviser's fees are split 20% to revenue
and 80% to capital. All other expenses are recognised as revenue.
Foreign currency
Transactions denominated in foreign currencies are translated into sterling at
the exchange rates as at the date of the transaction. Monetary assets and
liabilities denominated in foreign currencies at the period end are reported
at the rates of exchange prevailing at the period end. Any gain or loss
arising from a change in exchange rates subsequent to the date of the
transaction is included as an exchange gain or loss to capital or revenue in
the Statement of Comprehensive Income as appropriate. Foreign exchange
movements on investments are included in the Statement of Comprehensive Income
within "gains on investments".
Cash and cash equivalents
Cash and cash equivalents include deposits held at call with banks and other
short-term deposits with original maturities of three months or less.
Trade and other payables
Trade and other payables are initially recognised at fair value, and
subsequently re-measured at amortised cost using the effective interest method
where necessary.
Nature and purpose of equity and reserves:
Share capital and share premium
Share capital represents the 1p nominal value of the issued share capital.
Ordinary Shares are classified as equity. Costs directly attributable to the
issue of new shares (that would have been avoided if there had not been a new
issue of new shares) are recognised against the value of the ordinary share
premium.
The share premium account arose from the net proceeds of new shares and from
the excess proceeds received on the sale of shares from treasury over the
repurchase cost.
Capital reserve
Profits and losses achieved by selling investments, changes in fair value
arising upon the revaluation of investments that remain in the portfolio and
other capital expenditure are all charged to the capital column of the
Statement of Comprehensive Income and allocated to the capital reserve. The
capital reserve reflects any:
· gains or losses on the disposal of investments;
· exchange movements of a capital nature;
· the increases and decreases in the fair value of investments
which have been recognised in the capital column of the Statement of
Comprehensive Income; and
· expenses which are capital in nature.
Any gains in the fair value of investments that are not readily convertible to
cash are treated as unrealised gains in the capital reserve.
Revenue reserve
The revenue reserve reflects all income and expenditure recognised in the
revenue column of the Statement of Comprehensive Income and is distributable
by way of dividends.
The Company's distributable reserve consists of the capital reserve
attributable to realised profit and the revenue reserve.
3. INVESTMENTS
(a) Investments held at fair value through profit or loss
As at As at
31 December 31 December
2025 2024
Investment at fair value through profit or loss £'000 £'000
Listed on a recognised overseas exchange 412,835 344,150
Unquoted investments 7,099 1,443
Total 419,934 345,593
(b) Movements during year
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Opening valuation 345,593 295,268
Opening unrealised gains on investments (58,029) (53,543)
Opening book cost 287,564 241,725
Investment purchases, at cost 60,663 164,515
Investment sales, at cost (37,019) (118,676)
Closing book cost 311,208 287,564
Revaluation gains on investments held at year end 108,726 58,029
Closing valuation 419,934 345,593
These investments have been revalued over time and until they were sold any
unrealised gains/(losses) were included in the fair value of the investments.
Transaction costs on investment purchases for the year ended 31 December 2025
amounted to £58,000 (31 December 2024: £125,000) and on investment sales
for the year ended 31 December 2025 amounted to £35,000 (31 December 2024:
£109,000).
As at 31 December 2025, the Company held interests of 3% or more of any share
class in 16 investee companies (31 December 2024: 18 investee companies).
Valuation % of voting
Portfolio holdings £'000 rights
Helios Techno Holding Co Ltd 11,067 9.7
Eiken Chemical Co Ltd 37,271 9.5
Hogy Medical Co Ltd 61,214 8.6
ASKA Pharmaceutical Holdings Co Ltd 23,086 8.3
Meisei Industrial Co Ltd 33,009 7.5
Nasu Denki Tekko Co Ltd 6,928 7.3
Ebara Jitsugyo Co Ltd 18,603 7.1
Murakami Corp 23,827 5.8
Teikoku Sen-I Co Ltd 23,198 5.4
Teikoku Tsushin Kogyo Co Ltd 6,273 5.0
Sekisui Jushi Corp 15,138 4.7
Stella Chemifa Corp 11,434 4.2
Meiko Trans Co Ltd 12,881 4.0
Nissan Tokyo Sales Holdings 5,264 3.7
Bunka Shutter Co Ltd 24,234 3.5
Noritz Corp 14,178 3.1
(c) Gains/(losses) on investments
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Realised gains on disposal of investments 8,281 42,256
Net transaction costs (93) (234)
Movement in unrealised gains on investments held 50,697 4,486
Total gains on investments held at fair value 58,885 46,508
Fair Value Measurements of Financial Assets and Financial Liabilities
The financial assets and liabilities are either carried at their fair value,
or the amount is a reasonable approximation of fair value (due from brokers,
dividends receivable, accrued income, due to brokers, expense accruals and
cash and cash equivalents).
Categorisation within the hierarchy has been determined on the basis of the
lowest level input that is significant to the Fair Value measurement of the
relevant asset as follows:
Level 1 - valued using quoted prices in active markets for identical assets.
Level 2 - valued by reference to valuation techniques using observable inputs
other than quoted prices.
Level 3 - valued by reference to valuation techniques using inputs that are
not based on observable market data.
The valuation techniques for investments used by the Company are explained in
the accounting policies in note 2.
The table below sets out fair value measurements using the Fair Value
Hierarchy.
Level 1 Level 2 Level 3 Total
As at 31 December 2025 £'000 £'000 £'000 £'000
Assets:
Equity investments 412,835 - 7,099 419,934
Total 412,835 - 7,099 419,934
Level 1 Level 2 Level 3 Total
As at 31 December 2024 £'000 £'000 £'000 £'000
Assets:
Equity investments 344,150 - 1,443 345,593
Total 344,150 - 1,443 345,593
The movement on the Level 3 unquoted investments during the year is shown
below:
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Opening balance 1,443 -
Additions during the year 1,553 1,443
Disposals during the year (967) -
Unrealised gains/(losses) on investments 5,070 -
Total 7,099 1,443
There were no transfers between the levels during the year (31 December 2024:
none)
As at year end, the Company had two unquoted investments; Trancom Co., Ltd and
T&K TOKA Corporation (31 December 2024: One unquoted investment).
4. INCOME
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Income from investments:
Overseas dividends 11,386 9,125
Other income:
Bank interest income 3 7
Total income 11,389 9,132
5. INVESTMENT ADVISER FEES
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Basic fee:
20% charged to revenue 656 583
80% charged to capital 2,623 2,334
Total: 3,279 2,917
The Company's Investment Adviser is Rising Sun Management Ltd. The Investment
Adviser is entitled to receive an annual fee from the Company of 0.85% per
annum of NAV.
There is no performance fee payable to the Investment Adviser.
6. OTHER OPERATIONAL EXPENSES
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Directors' fees and expenses 282 227
Administration & secretarial fees 252 217
Auditor's remuneration(1) 58 49
AIFM fees 145 124
Broker retainer fees 68 77
Custodian fees 91 116
D&O Insurance 27 18
Marketing fees 84 75
Legal fees 168 82
UKLA and other regulatory fees 56 21
Miscellaneous expenses 132 440
Total 1,363 1,446
1 This is the Auditor's fee for the statutory audit of these
financial statements excluding VAT of £11,600 (31 December 2024: £9,800) and
out of pocket expenses.
7. TAXATION
(a) Analysis of tax charge in the year:
Year ended Year ended
31 December 2025
31 December 2024
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Overseas withholding tax 1,138 - 1,138 913 - 913
Total tax charge for the year (see note 7 (b)) 1,138 - 1,138 913 - 913
(b) Factors affecting the tax charge for the year:
The effective UK corporation tax rate for the year is 25% (2024: 25%). The tax
charge for the Company differs from the charge resulting from applying the
standard rate of UK corporation tax for an investment trust company. The
differences are explained below:
Year ended Year ended
31 December 2025
31 December 2024
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Profit before taxation 9,370 55,887 65,257 7,103 42,340 49,443
Effective corporation tax at 25% (2024: 25%) 2,343 13,972 16,315 1,776 10,585 12,361
Effects of:
Overseas withholding tax suffered 1,138 - 1,138 913 - 913
Non-taxable overseas dividends (2,847) - (2,847) (2,281) - (2,281)
Capital gains not subject to tax - (14,721) (14,721) - (11,628) (11,628)
Movement in unutilised management expenses 491 655 1,146 507 584 1,091
Unutilised finance costs 13 - 13 (2) - (2)
Foreign exchange gains/(losses) not subject to tax - 94 94 - 459 459
Total tax charge for the year 1,138 - 1,138 913 - 913
The Company is not liable to UK Corporation tax on capital gains due to its
status as an investment trust. The Company has a total gross tax loss of
£16,531,000 (2024: £11,841,000) and as a result an unrecognised deferred UK
Corporation tax asset of £4,133,000 (31 December 2024: £2,960,000) based on
the UK corporation tax rate of 25% (2024: 25%). This asset has accumulated
because deductible expenses exceeded taxable income for the year ended 31
December 2025. No asset has been recognised in the accounts because, given the
composition of the Company's portfolio, it is unlikely that this asset will be
utilised in the foreseeable future.
8. DIVIDEND
(a) Dividends paid during the year
Dividends paid during the respective years are detailed in the below table:
Year ended Year ended
31 December 2025
31 December 2024
Pence Pence
per Share £'000 per Share £'000
Interim dividend - paid 23 May 2025 3.25 6,147 - -
Interim dividend - paid 24 May 2024 - - 1.6 3,026
Total 3.25 6,147 1.6 3,026
(b) Dividends payable in respect of the financial year, which is the basis
on which the requirements of s1158-1159 of the Corporation Tax Act 2010 are
considered
Year ended Year ended
31 December 2025
31 December 2024
Pence Pence
per Share £'000 per Share £'000
Interim dividend - payable on 16 July 2026 5.52 10,754 3.25 6,147
(2024: paid 23 May 2025)
The Directors recommend the payment of a final dividend for the year of 5.52p
per share. Subject to approval at the Company's Annual General Meeting, the
dividend will have an ex-dividend date of 18 June 2026 and will be paid on 16
July 2026, to shareholders on the register at 19 June 2026.
9. TRADE AND OTHER RECEIVABLES
As at As at
31 December 31 December
2025 2024
£'000 £'000
Accrued income 1,143 969
Sales for settlement 173 2
VAT receivable 52 292
Prepayments 41 7
Total 1,409 1,270
10. TRADE AND OTHER PAYABLES
As at As at
31 December 2025 31 December 2024
£'000 £'000
Amounts falling due within one year:
Purchases for future settlement 507 1,186
Accrued expenses 164 124
Total 671 1,310
11. SHARE CAPITAL
Share capital represents the nominal value of shares that have been issued.
The share premium includes any premiums received on issue of share capital.
Any transaction costs associated with the issuing of shares are deducted from
share premium.
Year ended Year ended
31 December 2025 31 December 2024
No. of shares £'000 No. of shares £'000
Allotted, issued and fully paid:
Opening balance 189,141,704 1,891 189,141,704 1,891
Ordinary Shares of 1p each ('Ordinary Shares') issued 3,373,282 34 - -
Closing balance 192,514,986 1,925 189,141,704 1,891
During the year to 31 December 2025, 3,373,282 Ordinary Shares (31 December
2024: Nil) were issued with aggregate proceeds of £7,256,000 (31 December
2024: £Nil).
There were no share buybacks during the year to 31 December 2025 (31 December
2024: Nil).
Following the year end, the Company has issued 2,300,000 Ordinary Shares for
aggregate gross proceeds of £5,685,700.
Rights attaching to the Ordinary Shares
Dividend rights: All Ordinary Shares are entitled to a distribution of
dividends, in the event that the Directors resolve to make such a distribution
to shareholders, in the same proportions as capital is attributable to them.
Rights as respect to capital: On a winding-up or a return of capital, in the
event that the Directors resolve to make a distribution to shareholders, all
Ordinary Shares are entitled to a distribution of capital in the same
proportions as capital is attributable to them.
Voting rights: Every shareholder shall have one vote for each Ordinary Share
held.
12. EARNINGS PER ORDINARY SHARE
Total return per Ordinary Share is based on the return on ordinary activities,
including income, for the year after taxation of £64,068,000 (31 December
2024: profit £48,530,0000).
Based on the weighted average number of Ordinary Shares in issue for the year
to 31 December 2025 of 190,155,512 (31 December 2024: 189,141,704), the
returns per share were as follows:
Year ended Year ended
31 December 2025 31 December 2024
Revenue Capital Total Revenue Capital Total
(Loss)/ Profit for the year (£'000) 8,181 55,887 64,068 6,190 42,340 48,530
Return per Ordinary Share 4.30p 29.39p 33.69p 3.27p 22.39p 25.66p
The Company does not have any dilutive securities therefore basic and diluted
earnings per share are the same.
13. NET ASSET VALUE PER SHARE
Total equity and the NAV per share attributable to the Ordinary Shares at the
year end calculated in accordance with the Articles of Association were as
follows:
As at As at
31 December 31 December
2025 2024
Net Asset Value (£) 430,619,000 365,442,000
Ordinary Shares in issue 192,514,986 189,141,704
NAV per Ordinary Share 223.68p 193.21p
14. RELATED PARTY TRANSACTIONS
Transactions with the Investment Adviser
The fees for the year are disclosed in note 5 with no amounts outstanding at
the year ended 31 December 2025.
A key member of the RSM team is a major shareholder of Rosenwald Capital
Management, Inc. Further details of Rosenwald Capital Management, Inc.'s
shareholding is disclosed in the annual report.
Rosenwald Capital Management, Inc. receives dividends paid by the Company
based on its shareholding.
Directors' fees and shareholdings
During the year ended 31 December 2025, Directors' fees were paid at a rate of
£31,700 (2024: £29,535) per annum for each Director other than the Chairman,
who was entitled to receive £47,000 (2024: £43,830) and the Chair of the
Audit Committee who was entitled to an additional fee of £6,300 (2024:
£5,515) per annum.
The Board reviewed the rate of Directors' fees in November 2025 and decided
that the fees for Directors be increased in line with the average market
levels by £1,300 with effect from 1 January 2026, with the fees for the Chair
and Audit Chair remaining unchanged.
Directors' Fees Directors' Fees
per annum for per annum for Increase in
the year ending the year ending line with
31 December 2025 31 December 2024 market levels
Position (GBP) (GBP) %
Board Chairman 47,000 43,830 7.2
Director 31,700 29,535 7.3
Audit Committee Chair (additional fee) 6,300 5,515 14.2
The Directors had the following shareholdings in the Company, all of which
were beneficially owned.
As at As at
31 December 31 December
2025 2024
Rosemary Morgan 41,450 41,450
Chetan Ghosh 40,000 40,000
Rachel Hill 115,791 115,791
Alicia Ogawa 25,000 25,000
Ayako Weissman 50,000 50,000
Claire Boyle - -
15. FINANCIAL INSTRUMENTS AND CAPITAL DISCLOSURES
Risk Management Policies and Procedures
As an investment trust the Company invests in equities for the long-term in
order to achieve its investment objective. In pursuing its investment
objective, the Company is exposed to a variety of risks that could result in
either a reduction in the Company's net assets or a reduction of the profits
available for dividends.
These risks include market risk (comprising currency risk, interest rate risk,
and other price risk), liquidity risk, credit risk and the Directors'
objectives, policies and processes for managing the risks and the methods used
to measure the risks, are set out below.
(i) Market Risk
Economic conditions
Changes in economic conditions in Japan (for example, interest rates and rates
of inflation, industry conditions, competition, political and diplomatic
events and other factors) and in the countries in which the Company's investee
companies operate could substantially and adversely affect the Company's
prospects.
Sectoral diversification
The Company is not subject to restrictions on the amount it may invest in any
particular sector. Although the portfolio is expected to be diversified in
terms of sector exposures, the Company may have significant exposure to
portfolio companies from certain sectors from time to time. As there is no
hard limit on the amount the Company may invest in any sector the entire
portfolio may, at certain times, be invested solely in one sector. Greater
concentration of investments in any one sector may result in greater
volatility in the value of the Company's investments and consequently its NAV
and may materially and adversely affect the performance of the Company and
returns to shareholders.
Management of market risks
The Company is invested in a diversified portfolio of investments.
The Board will not set any limits on sector weightings or stock selection
within the portfolio. The Board will apply the following restrictions on the
size of its investments:
· not more than 20 per cent. of the Gross Asset Value at the time
of investment will be invested in the securities of a single issuer; and
· the Company will only make an investment in an unquoted company
if the aggregate interest of the Company in unquoted companies at the time of
such investment is not more than 10 per cent. of the Net Asset Value of the
Company at that time.
· total net investment Derivative exposure will not exceed 20 per
cent. of Gross Asset Value at the time of investment; and
· total exposure to any single counterparty which has issued
Derivatives to the Company will not exceed 20 per cent. of Gross Asset Value
at the time of investment.
(a) Currency risks
The majority of the Company's assets will be denominated in a currency other
than sterling (predominantly in Japanese yen) and changes in the exchange rate
between sterling and Japanese yen may lead to a depreciation of the value of
the Company's assets as expressed in sterling and may reduce the returns to
the Company from its investments and, therefore, negatively impact the level
of dividends paid to shareholders.
Management of currency risks
The Company does not currently intend to enter into any arrangements to hedge
its underlying currency exposure to investment denominated in Japanese yen,
although the Investment Adviser and the Board may review this from time to
time.
Foreign currency exposures
An analysis of the Company's equity investments that are priced in a foreign
currency is:
As at As at
31 December 31 December
2025 2024
£'000 £'000
Portfolio of investments: yen 419,934 345,593
Trade and other receivables and payables : yen 810 971
Cash: yen 8,342 19,804
Cash: USD 3 -
Total 429,089 366,368
Foreign currency sensitivity
If the Japanese yen had appreciated or depreciated by 10% as at 31 December
2025 then the value of the portfolio as at that date would have increased or
decreased as shown below.
Increase in Decrease in Increase in Decrease in
Fair Value Fair Value Fair Value Fair Value
As at As at As at As at
31 December 31 December 31 December 31 December
2025 2025 2024 2024
£'000 £'000 £'000 £'000
Impact on portfolio - increase/(decrease) 41,993 (41,993) 34,559 (34,559)
Impact on NAV - increase/(decrease) 42,909 (42,909) 36,637 (36,637)
(b) Interest rate risks
The Company is exposed to interest rate risk specifically through its cash
holdings. Interest rate movements may affect the level of income receivable
from any cash at bank and on deposits. The effect of interest rate changes on
the earnings of the companies held within the portfolio may have a significant
impact on the valuation of the Company's investments.
Management of interest rate risks
Prevailing interest rates are taken into account when deciding on borrowings.
Interest rate exposure
The exposure at 31 December 2025 of financial assets and liabilities to
interest rate risk is shown by reference to floating interest rates - when the
interest rate is due to be reset.
As at As at
31 December 31 December
2025 2024
£'000 £'000
Exposure to floating interest rates:
Floating rate on cash balance : yen 8,342 19,804
Floating rate on cash balance : USD 3 -
(c) Price risks
Price risk includes changes in market prices, other than those arising from
interest rate risk or currency risk, which may affect the value of equity
investments.
Management of price risk
The Board meets on at least four occasions each year where it considers the
asset allocation of the portfolio and the risk associated with particular
industry sectors. The Company's Investment Adviser has responsibility for
monitoring the portfolio, which is selected in accordance with the Company's
investment objective and seeks to ensure that individual stocks meet an
acceptable risk/reward profile.
Price risk exposure
The Company's total exposure to changes in market prices at 31 December 2025
comprises its holdings in equity investments as follows:
As at As at
31 December 31 December
2025 2024
£'000 £'000
Investments held at fair value through profit or loss 419,934 344,150
Market price risk sensitivity
The effect on the portfolio of a 10% increase or decrease in market prices
would have resulted in an increase or decrease of £41,993,400 (31 December
2024: £34,415,000) in the investments held at fair value through profit or
loss at the year end date. This analysis assumes that all other variables
remain constant.
The Company's portfolio of unlisted level 3 investments is not necessarily
affected by market performance, however the valuations may be affected by the
performance of the underlying securities in line with the valuation criteria
in note 2. The valuation of the unlisted instruments are not materially
sensitive to estimated assumptions at the Statement of Financial Position
date.
(ii) Liquidity risks
The securities of small-to-medium-sized (by market capitalisation) companies
may have a more limited secondary market than the securities of larger
companies. Accordingly, it may be more difficult to effect sales of such
securities at an advantageous time or without a substantial drop in price than
securities of a company with a large market capitalisation and broad trading
market. In addition, securities of small-to-medium-sized companies may have
greater price volatility as they can be more vulnerable to adverse market
factors such as unfavourable economic reports.
Management of liquidity risks
The Company's Investment Adviser monitors the liquidity of the Company's
portfolio on a regular basis.
Liquidity risk exposure
The undiscounted gross cash outflows of the financial liabilities as at 31
December 2025, based on the earliest date on which payment can be required,
were as follows:
As at As at
31 December 31 December
2025 2024
less than less than
3 months 3 months
Creditors: amounts falling due within one year
Trade and other payables 671 1,310
Total 671 1,310
Liquidity risk is minimised by holding sufficient liquid investments which can
be readily realised to meet liquidity demands. The Company's liquidity risk is
managed on a daily basis by the Investment Adviser in accordance with
established policies and procedures in place. Liquidity risk is not
significant as the majority of the Company's assets are investments in quoted
equities that are expected to be readily realisable under normal conditions.
(iii) Credit risks
Cash and other assets held by the Custodian
Cash and other assets that are required to be held in custody will be held by
the Custodian or its sub-custodians. Cash and other assets may not be treated
as segregated assets and will therefore not be segregated from any custodian's
own assets in the event of the insolvency of a custodian.
Cash held with any custodian will not be treated as client money subject to
the rules of the FCA and may be used by a custodian in the course of its own
business. The Company will therefore be subject to the creditworthiness of its
custodians. In the event of the insolvency of a custodian, the Company will
rank as a general creditor in relation thereto and may not be able to recover
such cash in full, or at all.
Management of credit risks
The Company has appointed The Northern Trust Company as its Custodian. The
credit rating of Northern Trust was reviewed at the time of appointment and is
reviewed on a regular basis by the Investment Adviser and/or the Board.
The Fitch's credit rating of Northern Trust as at year end is AA- (31 December
2024: AA-).
The Investment Adviser monitors the Company's exposure to its counterparties
on a regular basis and the position is reviewed by the directors at Board
meetings.
In summary, the exposure to credit risk as at 31 December 2025 was as follows:
As at As at
31 December 31 December
2025 2024
£'000 £'000
Cash at bank 9,947 19,889
Trade and other receivables 1,409 971
Total 11,356 20,860
(iv) Capital Management Policies and Procedures
The Company's capital management objectives are:
· to ensure that the Company will be able to continue as a going
concern; and
· to provide dividend income combined with capital growth, mainly
through investment in equities listed or quoted in Japan.
The key performance indicators are contained in the strategic report.
The Company is subject to several externally imposed capital requirements:
· As a public company, the Company has to have a minimum share
capital of £50,000.
· In order to be able to pay dividends out of profits available for
distribution by way of dividends, the Company has to be able to meet one of
the two capital restriction tests imposed on investment companies by company
law.
The Company's capital at 31 December 2025 comprises called-up share capital
and reserves totalling £430,619,000 (31 December 2024: £365,442,000).
The Board regularly monitors, and has complied with, the externally imposed
capital requirements.
16. POST YEAR-END EVENTS
Other than those included in these Financial Statements or below, there have
been no significant events since the year end which would require revision of
the figures or disclosure in the Financial Statements.
On 17 December 2025, the Company announced participation in a successful
tender offer for Hogy Medical, led by Carlyle as outlined further in the
annual report. NAVF and co-investors agreed to tender their 27.58% stake,
including NAVF's 8.58% holding. This transaction, which will take Hogy Medical
private and delist it from the Tokyo Stock Exchange, values NAVF's holding at
approximately £62.4 million, an increase from its previous valuation of
£55.2 million. Following the tender offer, NAVF and co-investors reinvested a
portion of their proceeds for an approximately 10% economic interest in a
Carlyle-affiliated acquiring entity.
On 5 February 2026, a General Meeting was held at which shareholders approved
the cancellation of the Company's share premium account, which stood at
£239,056,149 as at 16 January 2026. The Board convened the meeting in order
to increase the Company's distributable reserves and thereby provide greater
flexibility for potential future distributions to shareholders. The resolution
was passed with 99.98% of votes cast in favour and the cancellation became
effective on 12 March 2026.
FINANCIAL INFORMATION
This announcement does not constitute the Company's statutory accounts. The
financial information is derived from the statutory accounts, which will be
delivered to the registrar of companies and will be put forward for approval
at the Company's Annual General Meeting. The auditors have reported on the
accounts for the year ended 31 December 2024 and the year ended 31 December
2025, their reports were unqualified and did not include a statement under
Section 498(2) or (3) of the Companies Act 2006.
The Annual Report for the year ended 31 December 2025 was approved on 7 April
2026.
ANNUAL GENERAL MEETING
The Annual General Meeting will be held at Prince Philip House, 3 Carlton
House Terrace, London, SW1Y 5AG on Thursday 4 June 2026 at 12:30 p.m.
For further information contact:
NSM Funds (UK) Limited
4th Floor, 46-48 James Street, London, W1U 1EZ
Email: navf@nsm.group (mailto:navf@nsm.group)
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