Worldwide Healthcare Trust PLC - Annual Financial Report
PR Newswire
LONDON, United Kingdom, June 05
4 June 2026
Worldwide Healthcare Trust PLC
(the "Company")
Annual Financial Report for the year ended 31 March 2026
The statements below are extracted from the Company's Annual Report for the year ended 31 March 2026 (the "Annual Report"). The Annual Report, will be posted to shareholders on 12 June 2026. Copies of the Annual Report will be available in hard copy format from the Company Secretary, Frostrow Capital LLP, 25 Southampton Buildings, London WC2A 1AL or from the Company's website at www.worldwidewh.comwhere up to date information on the Company, including daily NAV, share prices and fact sheets, can also be found.
The Annual Report will be submitted to the Financial Conduct Authority and will shortly be available in full, unedited text for inspection on the National Storage Mechanism (NSM): https://data.fca.org.uk/#/nsm/nationalstoragemechanism
The Annual General Meeting will be held on Tuesday, 14 July 2026.
FINANCIAL AND PERFORMANCE
Historic Performance
for the years ended 31 March
2026 | 2025 | 2024 | 2023 | 2022 | 2021 | |
Net asset value per share (total return)*^ | 10.0% | -10.3% | 12.0% | -0.1% | -5.8% | 30.0% |
Benchmark (total return)* | 1.8% | -3.2% | 10.9% | 2.5% | 20.4% | 16.0% |
Net asset value per share | 371.0p | 339.5p | 381.1p | 343.5p | 346.5p | 370.3p |
Share price | 334.0p | 297.5p | 335.0p | 311.5p | 327.5p | 369.5p |
Discount of share price to net asset value per share^ | (10.0)% | (12.4)% | (12.1)% | (9.3)% | (5.5)% | (0.2)% |
Dividends per share | 2.4p | 2.4p | 2.8p | 3.1p | 2.7p | 2.2p |
Leverage | 12.5% | 12.0% | 10.8% | 10.5% | 10.9% | 7.6% |
Ongoing charges^ | 0.9% | 0.8% | 0.9% | 0.8% | 0.9% | 0.9% |
Ongoing charges (including performance fees paid or crystallised during the year)^ | 0.9% | 0.8% | 0.9% | 0.8% | 1.4% | 0.9% |
Comparative periods have been restated for the sub-division of each share of 25p each into 10 new shares of 2.5p each, approved at the AGM held on 18 July 2023 and effective on 27 July 2023.
* ": Morningstar
^ Alternative Performance Measure (see Glossary).
STATEMENT FROM THE CHAIR
"Net asset value per share total return during the year was +10.0%, significantly outperforming our Benchmark. Long-term returns remain strong, at +13.3% pa since the Company's inception"
INVESTMENT PERFORMANCE
I am pleased to report that the Company's net asset value (NAV) per share total return in the financial year was +10.0% (2025: -10.3%). In comparison, our Benchmark, the MSCI World Health Care Index, measured on a net total return, sterling adjusted basis, returned +1.8% (2025: -3.2%). During the year, on 26 November 2025, the Company hit an all - time high NAV per share of 421.8p.
The Company's share price total return during the year was +13.1% (2025: -10.5%). The disparity between the performance of the Company's NAV per share and its share price contributed to the narrowing of our share price discount to our NAV per share from 12.4% at 31 March 2025 to 10.0% at 31 March 2026. The average discount of the Company's share price to the NAV per share during the Company's financial year was 8.0%.
These results were achieved in uncertain and volatile conditions during which global equity markets were influenced by a combination of changing interest rate expectations, U.S. regulatory policy uncertainty and persistent geopolitical tensions. The latter, in particular, cast a long shadow over general investor confidence, with the ongoing conflict in Ukraine and the new war in the Middle East impacting global energy supplies, shipping routes and broader regional stability, all of which heightened investor risk aversion and contributed to market volatility.
In the healthcare sector, the first half of the financial year was marked by underperformance relative to the broader markets, largely due to uncertainty regarding U.S. drug pricing and tariff policies. The second half of the year brought clarity on these two key issues and led to six months of outperformance for healthcare. In this environment, our Portfolio Manager made two material changes to our portfolio sub-sector weightings which added to the Company's outperformance: our exposure to Large Cap Pharmaceutical companies was increased by some 10% across selective names and our exposure to MedTech companies was decreased by some 11%. These changes were done in the context of maintaining the Company's ongoing strategic overweight position to innovation and growth opportunities across the healthcare spectrum.
More specifically, with the U.S. healthcare policy uncertainty lifted late in 2025, the Biotechnology and Pharmaceutical sub-sectors began to outperform, driven by a combination of strong growth from new product flows and large development pipelines. In the Biotechnology sub-sector, where many companies with high quality, innovative pipelines trade at attractive valuations, M&A activity was a meaningful contributor to performance during the year. The principal detractor from performance was the MedTech sub-sector, predominantly due to the large share price decline in Boston Scientific. In Healthcare Services, where sector margins came under pressure for managed care organisations and companies with prominent Medicare exposure, prices also underperformed.
Further information on the healthcare sector, the Company's investments and performance during the year can be found in the Portfolio Manager's Review.
CAPITAL
Since the beginning of 2022, share price discounts across the investment company sector in the UK have widened. As at 3 June 2026, the average level of discount in the broader investment company sector stood at c. 10.4%*. This compares to the Company's share price discount of 6.9%.
It is the Board's policy to buy back our shares if the Company's share price discount to the NAV per share exceeds 6% on an ongoing basis. Shareholders should note, however, that it remains possible for the discount to be greater than this for extended periods of time, particularly when sentiment towards investment trusts generally, the healthcare sector and/or the Company remains poor.
In such an environment, buybacks may prove unable to sustainably narrow the discount. Nonetheless, even in such an environment, the Board believes that buybacks are important, as they enhance the NAV per share for remaining shareholders and go some way to dampening discount volatility.
During the financial year, a total of 121,219,387 shares were repurchased for treasury at a cost of £396.3m and at an average discount of 7.0%. The shares repurchased during the year equated to 24.5% of the Company's share capital at the beginning of the year. Share buybacks contributed 1.8% to the Company's NAV per share return over the year.
* Source: Winterflood
The Company's commitment to its share buyback policy is demonstrated by the fact that we continue to have one of the most active buyback programmes in the investment trust sector. A General Meeting was held during the year (in October 2025) to renew the shareholder authority to buy back shares when it became clear that the authority in place would be exhausted. A further such General Meeting was also held in June 2026.
The renewals were approved by shareholders and, therefore, the Company has been able to continue the operation of the discount management policy. Since the current renewed authority will expire at the conclusion of the Company's forthcoming Annual General Meeting, in line with usual practice, the Company will ask shareholders to renew the authority again at the Annual General Meeting in July.
At 31 March 2026, the Company had 373,412,417 shares in issue, excluding the 228,252,783 shares held in treasury.
From the beginning of the new financial year to 3 June 2026, a further 10,373,640 shares have been bought back for treasury, at a cost of £35.8m and at an average discount of 7.6%. As stated above, our share price discount since year-end has narrowed to 6.9%.
I confirm that all shares held in treasury will continue to be held for re-issue at a premium to the net asset value per share.
A summary of the Board's and the Company's advisers' activities during the year, including share buyback and marketing activities, is provided on page 9 of the Annual Report.
REVENUE AND DIVIDEND
Shareholders will be aware that it remains the Company's investment policy to pursue capital growth for shareholders and to pay dividends at least to the extent required to maintain investment trust status. Therefore, the level of dividends declared can go down as well as up. An unchanged interim dividend of 0.7p per share for the year ended 31 March 2026 was paid on 9 January 2026 to shareholders on the register on 28 November 2025.
The Company's net revenue for the year as a whole decreased to £9.5m from £12.3m. This was due largely to the relatively low exposure to higher yielding stocks in the portfolio as well as a reduction in the size of the portfolio due to shares being bought back by the Company during the year. As a result, the revenue return per share was 2.2p (2025: 2.4p per share).
Accordingly, the Board is proposing an unchanged final dividend for the year of 1.7p per share. Together with the interim dividend already paid, this makes a total dividend for the year of 2.4p per share (2025: 2.4p per share).
The effect of share buybacks means that the reported dividend per share, which is based on the number of shares in issue at the end of the financial year, is higher than the reported revenue return per share, which is based on the average number of shares in issue over the year.
Based on the closing mid-market share price of 337.5p on 3 June 2026, the total dividend payment for the year represents a current yield of 0.7%.
The final dividend will be payable, subject to shareholder approval, on 23 July 2026, to shareholders on the register of members on 12 June 2026. The associated ex-dividend date will be 11 June 2026.
The Company's dividend policy, which is set out on page 34 of the Annual Report, will be proposed for approval at the forthcoming Annual General Meeting.
BOARD OF DIRECTORS
As mentioned previously, I will be retiring as Chair of the Company's Board at the conclusion of this year's Annual General Meeting. The four years of my tenure as Chair have seen a renewal of the Board. With the process of reshaping the Board now complete, the Board has a more evenly spread maturity profile established for the years ahead. In addition, it is the Board's intention going forward to limit the tenure of all Directors to nine years.
As already announced, the Board has, by way of a thorough succession process, chosen William Hemmings to succeed me as Chair. William is an experienced and strong leader who I am confident will guide the Board and the Company well in the years ahead.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE ("ESG") MATTERS
ESG matters continue to be an important priority for the Board. Our objective is to have full, transparent disclosure on the topic. Our Senior Independent Director, Bina Rawal, works closely with our Portfolio Manager on this matter.
Our Portfolio Manager remains committed to taking a leading role in the development of meaningful ESG engagement practices in the healthcare sector. As part of this, they facilitate dialogue and an exchange of leading practices among investors, companies and other relevant experts on ESG, in particular, in the large capitalisation pharmaceutical sector. They also engage with a broad range of companies on a regular basis about where areas for improvement can be identified. Further information on both ESG matters and climate change can be found in the Portfolio Manager's ESG report.
PERFORMANCE FEE
There is currently no provision within the Company's NAV for the payment of a performance fee at a future calculation date. I would highlight that earning a performance fee is difficult for our Portfolio Manager and is dependent on the long-term outperformance of the Company. Any outperformance has to be maintained for 12 months after the relevant calculation date and only becomes payable to the extent that the outperformance gives rise to a total fee greater than the total of all performance fees paid to date. This ensures that a performance fee is not payable for any outperformance that contributes to the recovery of prior underperformance.
ARTICLES OF ASSOCIATION
Following recent market guidance and a review of the Company's governance arrangements, a resolution is to be proposed to shareholders at the Company's Annual General Meeting to adopt new Articles of Association. The new provisions of the Company's Articles of Association are intended to strengthen the Company's governance framework and ensure that the Board has appropriate protections and flexibility to respond effectively to unforeseen circumstances arising at shareholder meetings, including scenarios where insufficient directors are elected. The Board remains committed to maintaining a robust and effective system of governance and to engaging constructively with shareholders. Further details of the changes are set out on page 50 of the Annual Report.
ANNUAL GENERAL MEETING ("AGM")
The Company's AGM will this year be held at Barber-Surgeons' Hall, Monkwell Square, Wood Street, Barbican, London EC2Y 5BL on Tuesday, 14 July 2026 from 12.30pm. In addition to the formal proceedings, there will be an opportunity to meet the Board and the Portfolio Manager and to receive an update on the Company's strategy. We look forward to seeing as many of you as possible there.
For those investors who are not able to attend the meeting in person, a video recording of the Portfolio Manager's presentation will be uploaded to the website after the meeting. Shareholders can submit questions in advance by sending them to wwh@frostrow.com.
I encourage all shareholders to exercise their right to vote at the AGM and to register your votes online in advance of the meeting. Registering your vote in advance will not restrict you from attending and voting at the meeting in person should you wish to do so. The votes on the resolutions to be proposed at the AGM will again be conducted on a poll. The results of the proxy votes will be published following the conclusion of the AGM by way of a stock exchange announcement and will also be able to be viewed on the Company's website at www.worldwidewh.com.
OUTLOOK
The near-term outlook for global equity markets remains, as always, uncertain. Current issues contributing to market volatility and risk appetite include the impact of wars and supply constraints on inflation and consumer spending, the potentially positive and negative impacts of Artificial Intelligence ("AI") and, in this context, the future direction and level of interest rates.
Within this environment, both our Portfolio Manager and the Board remain positive on the outlook for global equities over the long-run and, in particular, for the global healthcare sector. The U.S. regulatory environment appears increasingly supportive of innovation. At the same time, Large Cap Pharmaceutical companies continue to face significant patent expiry pressures, thus they are investing heavily in their innovative pipelines and there is a strong incentive for continued M&A activity, particularly in the Biotechnology sector, where valuations remain attractive relative to the high quality of innovation being delivered.
Overall, the Board remains confident in our Portfolio Manager's successful long-term investment strategy of focusing on innovation and growth opportunities across the healthcare spectrum and believes that the Company will continue to generate attractive long-term returns for shareholders.
IN CLOSING
It has been my privilege to serve the Company as a Director for 14 years and as Board Chair for the last four years. In addition to the many strong relationships I have developed during my time with the Company, I am grateful for the support and inspiration I have received from the Directors I have worked with, for the world-class expertise and professionalism of OrbiMed and for our shareholders and their continued confidence. I leave knowing the Company is in good hands.
Doug McCutcheon
Board Chair
4 June 2026
BOARD AND ADVISER ACTIVITY DURING THE YEAR
BOARD ANNUAL PROCESS
The Board maintains a high level of communication between its members and with its advisers. During the year, the Board held quarterly meetings and additional Board meetings as required.
In addition, meetings of the Management Engagement & Remuneration, Nominations and Audit & Risk Committees are held (see page 58 of the Annual Report for details of the Board and Committee meetings held during the year).
On an ongoing basis, the Board oversees and reviews, amongst other things: the roles and performance of the Portfolio Manager and the Company's other advisers; the Company's investment portfolio, net asset value and share price performance; operational risks; expenses; the broader investment trust sector and regulatory environment; shareholder communications and investor relations; the make-up and evolution of the Board and its committees.
CAPITAL ALLOCATION
The Board understands that long-term shareholder value is driven by effectively allocating the Company's capital.
Over the long run, the Board believes that having the Portfolio Manager reinvest capital into healthcare investments in the Company's portfolio will generate the highest overall returns. This is reflected in the Company's dividend policy, which involves only paying dividends to the extent required to maintain investment trust status.
In periods when the Company's share price is trading at a discount to its net asset value, the Board is also committed to allocating capital to repurchasing shares. Particularly when such periods coincide with lower valuations and attractive investment opportunities in the healthcare sector, the Board uses its judgement as to how best to split the allocation of the Company's capital.
During the year, a total of 121,219,387 shares, representing 24.5% of the shares outstanding at the beginning of the year, were repurchased at a cost of £396.3m and an average discount of 7.0% to the net asset value per share.
SHAREHOLDER ENGAGEMENT
The Board believes that shareholder engagement is key to generating a committed and informed investor base. Recently declining incremental investor demand across the investment trust sector, and an increase in share price discounts, has reinforced the importance of this activity.
The Company's efforts are actively supported by our Portfolio Manager (OrbiMed), our AIFM (Frostrow) and our PR consultant (Quill Communications), all with the aim of providing information and insight to our existing shareholders, while also generating new demand for the shares across professional and retail investors. Some of our more recent activities are highlighted below.
During 2025, OrbiMed had 20 meetings with professional investors, the Chairman and Chairman elect had 8 and Frostrow held a further 83 professional investor meetings, which involved both existing and potential shareholders.
Frostrow arranged a professional investor webinar for OrbiMed, in October 2025, involving 63 investors. The video recording of the event was viewed 333 times.
The AGM held on 9 July 2025 attracted 27 investors in person and the video recording of OrbiMed's presentation has been viewed 301 times.
Frostrow creates a monthly fact sheet that is circulated by email to a discreet database of over 2,700 professional investors.
The Company has a permanent slot at the annual Frostrow Seminar in London in May, that involves around 120 attendees. Recordings of the presentation were sent to over 5,200 people.
The Company's broker, Winterflood, held an investment companies' conference in January 2026 at which Portfolio Manager, Trevor Polischuk presented to an audience of professional investors.
Edison writes two research notes every year and produces accompanying videos, which are typically viewed by over 2,000 people. Their webinar in October 2025, featuring the Company, was recorded and subsequently viewed by over 6,900 private and professional investors.
Quill Communications is constantly engaging with relevant journalists. During 2025 this resulted in articles in a mix of publications including Citywire, Daily Telegraph, Financial Times, IFA Magazine, Interactive Investor, Investors' Chronicle, Master Investor, Money Makers, MoneyWeek, Shares Magazine, The Armchair Trader, The Times, This is Money, Trustnet.
Considerable effort is made by both Quill Communications and Frostrow to engage directly with retail investor platforms, to get them to produce articles and carry content about the Company.
INVESTMENT OBJECTIVE AND POLICY
INVESTMENT OBJECTIVE
The Company invests in the global healthcare sector with the objective of achieving a high level of capital growth.
In order to achieve its investment objective, the Company invests worldwide in a diversified portfolio of shares in pharmaceutical and biotechnology companies and related securities in the healthcare sector. It uses gearing, and derivative transactions to enhance returns and mitigate risk. Performance is measured against the MSCI World Health Care Index on a net total return, sterling adjusted basis ("Benchmark").
INVESTMENT STRATEGY
The implementation of the Company's Investment Objective has been delegated to OrbiMed by Frostrow (as "AIFM") under the Board's and Frostrow's supervision and guidance.
Details of OrbiMed's investment strategy and approach are set out in the Portfolio Manager's Review on pages 16 to 31 of the Annual Report.
While the Board's strategy is to allow flexibility in managing the investments, in order to manage investment risk it has imposed various investment, gearing and derivative guidelines and limits, within which Frostrow and OrbiMed are required to manage the investments, as set out below.
Any material changes to the Investment Objective, Policy and Benchmark or the investment, gearing and derivative guidelines and limits require approval from shareholders.
INVESTMENT POLICY
INVESTMENT LIMITS AND GUIDELINES
- The Company will not invest more than 15% of the portfolio in any one individual stock at the time of acquisition;
- At least 50% of the portfolio will normally be invested in larger companies (i.e. with a market capitalisation of at least U.S.$10bn);
- At least 20% of the portfolio will normally be invested in smaller companies (i.e. with a market capitalisation of less than U.S.$10bn);
- Investment in unquoted securities will not exceed 10% of the portfolio at the time of acquisition;
- A maximum of 5% of the portfolio, at the time of acquisition, may be invested in each of debt instruments, convertibles and royalty bonds issued by pharmaceutical and biotechnology companies;
- A maximum of 40% of the portfolio, at the time of acquisition, may be invested in companies in the healthcare equipment and supplies sector; and a maximum of 30% of the portfolio, at the time of acquisition, may be invested in companies in the healthcare providers and services sector.
- The Company will not invest more than 10% of its gross assets in other closed ended investment companies (including investment trusts) listed on the London Stock Exchange, except where the investment companies themselves have stated investment policies to invest no more than 15% of their gross assets in other closed ended investment companies (including investment trusts) listed on the London Stock Exchange, where such investments shall be limited to 15% of the Company's gross assets at the time of acquisition.
DERIVATIVE STRATEGY AND LIMITS
In line with the Investment Objective, derivatives are employed, when appropriate, in an effort to enhance returns and to improve the risk-return profile of the Company's portfolio. Only Equity Swaps were employed within the portfolio during the year.
The Board has set the following limits within which derivative exposures are managed:
- Derivative transactions (excluding equity swaps) can be used to mitigate risk and/or enhance capital returns and will be restricted to a net exposure of 5% of the portfolio; and
- Equity Swaps may be used in order to meet the Company's investment objective of achieving a high level of capital growth, and counterparty exposure through these is restricted to 12% of the gross assets of the Company at the time of acquisition.
The Company does not currently hedge against foreign currency exposure.
GEARING LIMIT
The Board has set a maximum gearing level, through borrowing, of 20% of the net assets.
LEVERAGE LIMITS
Under the AIFMD the Company is required to set maximum leverage limits. Leverage under the AIFMD is defined as any method by which the total exposure of an AIF is increased.
The Company has two current sources of leverage: the overdraft facility, which is subject to the gearing limit; and, derivatives, which are subject to the separate derivative limits. The Board and Frostrow have set a maximum leverage limit of 140% on both the commitment and gross basis.
Further details on the gearing and leverage calculations, and how total exposure through derivatives is calculated, are included in the Glossary. Further details on how derivatives are employed can be found in note 16.
PORTFOLIO
INVESTMENTS HELD AS AT 31 MARCH 2026
Market value | % of | |||
Investments | Sector | Country | £'000 | investments |
Eli Lilly | Pharmaceuticals | United States | 148,410 | 11.3 |
Boston Scientific | Health Care Equipment & Supplies | United States | 92,370 | 7.1 |
AstraZeneca | Pharmaceuticals | Britain | 84,982 | 6.5 |
Intuitive Surgical | Health Care Equipment & Supplies | United States | 62,245 | 4.8 |
Edwards Lifesciences | Health Care Equipment & Supplies | United States | 60,764 | 4.7 |
Merck | Pharmaceuticals | United States | 60,519 | 4.6 |
Roche | Pharmaceuticals | Switzerland | 57,913 | 4.4 |
Argenx | Biotechnology | Netherlands | 49,527 | 3.8 |
Bristol-Myers Squibb | Pharmaceuticals | United States | 42,536 | 3.3 |
Pfizer | Pharmaceuticals | United States | 41,433 | 3.2 |
Top 10 investments | 700,699 | 53.7 | ||
Stryker | Health Care Equipment & Supplies | United States | 38,863 | 3.0 |
Danaher | Life Sciences Tools & Services | United States | 33,427 | 2.6 |
Daiichi Sankyo | Pharmaceuticals | Japan | 31,976 | 2.4 |
Alnylam Pharmaceuticals | Biotechnology | United States | 29,830 | 2.3 |
Structure Therapeutics | Biotechnology | United States | 29,264 | 2.2 |
Natera | Life Sciences Tools & Services | United States | 27,466 | 2.1 |
Caris Life Sciences | Life Sciences Tools & Services | United States | 27,025 | 2.1 |
CG Oncology | Biotechnology | United States | 26,907 | 2.1 |
Elevance Health | Health Care Providers & Services | United States | 25,488 | 2.0 |
UCB | Pharmaceuticals | Belgium | 22,586 | 1.7 |
Top 20 investments | 993,531 | 76.2 | ||
Shanghai INT Medical Instruments | Health Care Equipment & Supplies | China | 22,368 | 1.7 |
Sino Biopharmaceutical | Pharmaceuticals | Hong Kong | 21,353 | 1.6 |
Mineralys Therapeutics | Biotechnology | United States | 20,119 | 1.5 |
Guardant Health | Life Sciences Tools & Services | United States | 19,294 | 1.5 |
Praxis Precision Medicines | Biotechnology | United States | 18,838 | 1.4 |
Abivax | Biotechnology | France | 18,349 | 1.4 |
Akeso | Biotechnology | China | 18,099 | 1.4 |
Xenon Pharmaceuticals | Biotechnology | Canada | 17,636 | 1.3 |
Thermo Fisher Scientific | Life Sciences Tools & Services | United States | 17,348 | 1.3 |
Ascendis Pharma | Biotechnology | Denmark | 15,693 | 1.2 |
Top 30 investments | 1,182,628 | 90.5 | ||
BrightSpring Health Services | Health Care Providers & Services | United States | 14,537 | 1.1 |
Axsome Therapeutics | Biotechnology | United States | 14,344 | 1.1 |
Dyne Therapeutics | Biotechnology | United States | 13,932 | 1.1 |
Beijing Yuanxin Technology* | Health Care Providers & Services | China | 13,531 | 1.0 |
Hangzhou Tigermed Consulting | Health Care Providers & Services | China | 12,923 | 1.0 |
uniQure | Biotechnology | Netherlands | 10,946 | 0.8 |
EDDA Healthcare & Technology* | Health Care Equipment & Supplies | China | 10,272 | 0.8 |
Alignment Healthcare | Health Care Providers & Services | United States | 9,517 | 0.7 |
Ruipeng Pet Group* | Health Care Providers & Services | China | 6,733 | 0.5 |
Carlsmed | Health Care Equipment & Supplies | United States | 5,846 | 0.4 |
Top 40 investments | 1,295,209 | 99.0 |
* Unquoted holding
Market value | % of | |||
Investments | Sector | Country | £'000 | investments |
API Holdings* | Health Care Providers & Services | India | 4,626 | 0.4 |
Visen Pharmaceuticals | Biotechnology | China | 2,612 | 0.2 |
Peloton Therapeutics - Milestone* | Biotechnology | United States | 1,308 | 0.1 |
ImageneBio | Biotechnology | United States | 509 | 0.0 |
Total investments | 1,304,264 | 99.7 | ||
Biotech M&A Target Swap | Swap Baskets | United States | 189,383 | 14.5 |
Jiangsu Hengrui Pharmaceuticals | Pharmaceuticals | China | 65,469 | 5.0 |
Less: Gross exposure on financed swaps | (251,062) | (19.2) | ||
Total OTC Swaps | 3,790 | 0.3 | ||
Total investments including OTC Swaps | 1,308,054 | 100.0 |
* Unquoted holding
SUMMARY
Market value | % of | |
Investments | £'000 | investments |
Quoted Equities | 1,267,795 | 96.9 |
Unquoted Equities | 36,469 | 2.8 |
Equity Swaps | 3,790 | 0.3 |
Total of all investments | 1,308,054 | 100.0 |
ABSOLUTE CONTRIBUTION BY INVESTMENT FOR THE YEAR ENDED 31 MARCH 2026
Principal contributors to and detractors from net asset value performance
Contribution | ||||||||
Contribution | Per share | |||||||
Top Five Contributors | Sector | Country | £'000 | P | ||||
AstraZeneca | Pharmaceuticals | Europe | 32,142 | 7.6 | ||||
CG Oncology | Biotechnology | United States | 22,198 | 5.2 | ||||
Exact Sciences* | Health Care Services | United States | 22,026 | 5.2 | ||||
Avidity Biosciences* | Biotechnology | United States | 21,440 | 5.1 | ||||
Apellis Pharmaceutical* | Biotechnology | United States | 21,173 | 5.0 | ||||
Contribution | |||||
Contribution | Per share | ||||
Top Five Detractors | Sector | Country | £'000 | P | |
Stryker | Health Care Equipment & Supplies | United States | (7,493) | (1.8) | |
Vertex Pharmaceuticals* | Biotechnology | United States | (10,328) | (2.4) | |
Daiichi Sankyo | Pharmaceuticals | Japan | (11,426) | (2.7) | |
United Health Group* | Health Care Providers & Services | United States | (50,312) | (11.9) | |
Boston Scientific | Health Care Equipment & Supplies | United States | (59,693) | (14.1) | |
* Not held at 31 March 2026
PORTFOLIO MANAGER'S REVIEW
MARKETS
The year ended 31 March 2026 presented an extraordinarily complex and volatile environment for global equities, characterised by severe geopolitical shocks, aggressive shifts in United States regulatory policy, and profound sector rotation. Investors were forced to navigate a variety of macroeconomic crosscurrents, from periods of intense optimism surrounding technology to extreme risk aversion driven by international conflict and inflation fears.
The financial year can broadly be divided into two distinct themes: a robust recovery phase driven by the relief-rally rebound post Liberation Day, followed by a severe macroeconomic contraction precipitated by conflict in the Middle East. Global equity markets advanced steadily through the first half of the period, supported by stabilising corporate earnings and the anticipation of an accommodative monetary policy stance from the U.S. Federal Reserve. This allowed the market to post all-time highs for six months in a row, from June through October and, after a brief November pause, resume in earnest in January and February only to be abruptly disrupted in the final month of the financial year following the outbreak of war with Iran.
Healthcare stocks, meanwhile, had a very different path. Whilst the broad market was able to shake off U.S. tariff concerns by May, continued rhetoric from the Trump administration on both pharmaceutical tariffs and U.S. drug pricing kept a lid on the healthcare sector for an additional five months, leading to a stark underperformance that peaked at over 22% (total return in sterling terms) on 29 September 2025. These issues, in particular, the perceived threat of a calamitous change to federal drug pricing rules through the proposed "Most Favoured Nation" pricing policy, kept investors away from healthcare, especially given the broader stock market rally.
The shape of healthcare returns then took a dramatic turn on 30 September 2025 when the Trump administration agreed to the first of 17 drug pricing and tariff agreements with the global major biopharmaceutical players. This event triggered a decoupling from the broader market and began a sustained rally based on fundamental clinical and commercial execution, given the partial easing and clarification of two major overhangs: U.S. drug pricing and pharmaceutical tariffs. Even as the broader market collapsed in March 2026 due to the Iran conflict, specific subsectors within healthcare - most notably biotechnology - demonstrated remarkable resilience, insulated by a historic wave of merger and acquisition (M&A) activity that highlighted the inelastic demand for therapeutic innovation.
ALLOCATION
The core philosophy governing the portfolio's allocation strategy remains steadfast: prioritising investment in paradigm-shifting medical innovation across the entire global healthcare ecosystem. The portfolio is dynamically managed to optimise risk-adjusted returns, deliberately deviating from the constraints of the MSCI World Health Care Index to capture the alpha generated by clinical trial successes, regulatory approvals, and corporate consolidation. Throughout the year, the Manager remained agile in navigating valuation dislocations and opportunities created by both macro factors and changing industry fundamentals.
The most critical element of the portfolio's allocation was the maintenance of a structural overweight position in Biotechnology, specifically targeting Emerging Biotechnology companies. As of the year-end, the Company's portfolio held a 31.8% absolute weight in Biotechnology compared to an index weight of 10.6%, reflecting our ongoing bullishness and fundamental belief around the enormous therapeutic innovation and new drug opportunities emanating from the sector. This was a modest increase from the 29.6% Biotechnology weight at the prior year-end, when the index weight was 9.0% and the active overweight was +20.6%. Within this, Emerging Biotechnology increased from 27.0.% to 31.8% on 31 March 2026, while the Emerging Biotechnology active overweight increased from +24.8% to +28.7%.
Within the broader Pharmaceuticals sub-sector, the portfolio maintained a selective posture and remained structurally underweight. The portfolio's strategy avoids passive exposure to Pharmaceuticals, instead concentrating capital exclusively in companies possessing industry-leading drug discovery, pipelines, development, pricing, new product flow, and dominant positions in growth categories such as oncology, rare diseases, immunology, and cardiometabolic disorders. This selective approach allowed the portfolio to maximise exposure to superior commercial execution while minimising the drag of sector-wide patent expirations. However, given the greater clarity on federal drug pricing and company-specific tariff stays, while recognising that tariff risk has not disappeared entirely, we materially increased our weighting here, particularly in the second half of the year. Overall, we closed the year with a weighting of 34.1% in Pharmaceuticals, representing more than a 10% increase from the start of year positioning but still notably below the benchmark weight of 50.9%.
The allocation to Healthcare Equipment & Supplies (MedTech) required the most tactical manoeuvring during the financial year. The portfolio entered the period with an overweight position, anticipating a continued recovery in global surgical procedure volumes and the acceleration of specific new product super-cycles in cardiovascular and robotic surgery. However, the macroeconomic environment began to deteriorate and rotation into Pharmaceuticals and Biotechnology (from MedTech) became evident. Recognising the vulnerability of highly elevated MedTech valuation multiples at this time, we reduced exposure. By the end of March 2026, the portfolio's weighting had been reduced to 18.8% from almost 30% at the beginning of the year, partially mitigating the portfolio from additional drawdowns in the sector whilst still maintaining a modest overweight position at year end of 4.7%. The remaining exposure is concentrated in companies with differentiated, difficult-to-replicate products, durable innovation cycles and attractive long-term growth prospects which supported retaining a modest overweight despite the reduction.
WWH vs MSCI World HC Index
(31 March 2026)
Subsector | Change since 31 March 2025 | WWH % of NAV | MSCI HC % | +/- % |
Pharmaceutic | +1000 bps | 34.1 | 50.9 | (16.7) |
Large Cap Pharma | 31.5 | 46.1 | (14.6) | |
Specialty Pharma | 2.6 | 4.7 | (2.1) | |
Biotechnology | +320 bps | 31.8 | 10.6 | 21.2 |
Large Cap Biotech | - | 7.6 | (7.6) | |
Emerging Biotech | 31.8 | 3.1 | 28.7 | |
Life Science Tools | +300 bps | 9.0 | 9.0 | - |
Medical Technology | -1050 bps | 18.8 | 14.1 | 4.7 |
Healthcare Services | -330 bps | 3.6 | 11.4 | (7.8) |
Japan | -70 bps | 2.3 | 4.0 | (1.7) |
Emerging Markets | +260 bps | 10.3 | - | 10.3 |
Unquoteds | -370 bps | 2.6 | - | 2.6 |
Total | 112.5 | 100.0 | 12.5 |
Exposure to Healthcare Providers and Services remained structurally underweight throughout the financial year and was reduced over the period. This defensive positioning was driven by the severe structural and regulatory challenges afflicting the United States managed care industry. Health insurers, particularly those with heavy exposure to the Medicare Advantage program, faced a difficult margin environment through mispriced plans set in the prior calendar year.
Geographically, the portfolio maintained targeted exposure to Emerging Markets, with a specific focus on the burgeoning life sciences sector in China. Despite the persistent overhang of geopolitical tensions and the threat of bilateral tariffs, the fundamental quality of innovation emerging from the Chinese biotechnology ecosystem could not be ignored. Exposure to China increased over the financial year primarily due to share price appreciation despite reductions from profit-taking.
More broadly, the investment case for China healthcare is no longer limited to domestic demand growth; it increasingly includes the ability of Chinese biotechnology companies to generate globally relevant innovation, as evidenced by growing cross-border licensing activity with U.S. and European pharmaceutical partners.
PERFORMANCE
The Company delivered strong absolute performance and very strong relative performance for the financial year ended 31 March 2026, successfully navigating unprecedented macroeconomic volatility to capture the value created by clinical breakthroughs and aggressive corporate consolidation within the life sciences sector. For the year, the portfolio's Net Asset Value ("NAV") per share generated a total return of +10.0%. This absolute performance stands in contrast to the broader healthcare market, as the Benchmark returned +1.8% on a net total return, sterling-adjusted basis. Consequently, the portfolio generated a material excess return of +8.2% over the Benchmark for the year. The Company's share buyback programme also contributed meaningfully, adding +1.8% to NAV per share total return during the period.
The financial year began with significant headwinds; in April 2025, in the face of "Trump-induced volatility" surrounding potential pharmaceutical tariffs and drug pricing threats. May 2025 brought further declines, as this rhetoric intensified. However, a critical inflection point arrived in the autumn. Following the resolution of the United States drug pricing policy overhang via the Pfizeragreement on 30 September 2025, the healthcare sector experienced a massive relief rally. The portfolio captured this upside aggressively, posting a +8.5% return in October 2025 (2.8% excess return over the Benchmark) and following this with a +8.7% return in November 2025 (1.5% excess return).
The final quarter of the financial year was dominated by the macroeconomic shock of the Iran war, which crushed global equity multiples. In March 2026, the broader healthcare Benchmark capitulated, falling 6.6%. The portfolio, however, demonstrated notable resilience, declining only 4.3% and thereby generating a +2.3% excess return in a severely down market.
This resilience culminated in a historic achievement on the final trading day of the financial year. On 31 March 2026, the announcement of two notable biotechnology acquisitions (including Biogen's buyout of portfolio holding ApellisPharmaceuticals) triggered a massive rally in the therapeutics space. On this single day, the portfolio recorded its best one-day excess return on record at +4.0%, and its fifth-best one-day absolute return at +5.6%. This solid finish put a capstone on the Company's M&A strategy that was employed throughout the financial year.
Performance since inception to 31 March 2026 remains impressive, improving to a +4,679% return since April 1995. This represents an average annualised return of 13.3% over the 30-plus year period. This ranks the Company in second place among all closed-end trusts (>£250m) across this period, regardless of industry (source: Winterflood). These figures also show a clear outperformance of the (blended) Benchmark over this period and over the FTSE 100 index as well. The Company achieved an all-time high NAV in the financial year, at 421.8p as on 26 November 2025.
SUB-SECTOR CONTRIBUTION
For the full year, outsized contribution came primarily from two sub-sectors: Biotechnology and Pharmaceuticals. The main offset of significance was MedTech, predominantly due to the dramatic share price decline in Boston Scientific.
Biotechnology was the primary alpha generator for the financial year. On an absolute basis, listed Biotechnology contributed +7.8%, while the Company's proprietary, Biotech M&A Basket" added a further +5.6%, together accounting for +13.4% of NAV performance. On a relative basis, these two areas were also the dominant contributors to the Company's +8.2% in excess return, with listed Biotechnology contributing +6.6% and the Biotech M&A Basket contributing +5.6%, before offsets elsewhere in the portfolio.
In Pharmaceuticals, positive absolute returns were generated through stock selection, although the portfolio's underweight allocation meant the contribution to relative performance was modestly negative. Despite positioning, the portfolio's carefully curated Pharmaceutical holdings contributed a positive +4.3% to absolute performance by maintaining a strategy of avoiding the "Have Nots" of the industry- companies with deteriorating pipelines and material exposure to patent expirations. Instead, the portfolio concentrated its capital exclusively in the "Haves" - companies with strong growth, large pipelines, impressive new product flow, and minimal patent exposure. When the sector re-rated following the resolution of the Trump administration's pricing policies, these high-quality entities captured the vast majority of the upside, including AstraZenecaand Eli Lilly.
Contributions or detractions from other sub-sectors were more subdued. In Emerging Markets for example, contribution reached +3.7% in the first half of the year but fell to +1.4% for the full financial year. This was due to a mix of profit taking in China healthcare stocks and heightened geopolitical tensions in the latter half of the year.
In Life Science Tools, the sub-sector provided a solid, positive contribution of +1.1% to absolute returns and outperformed the benchmark contribution that was close to flat. For reporting purposes, Diagnostics is captured within the Life Science Tools line rather than as a separate sub-sector. Within this area, the portfolio is focused on differentiated diagnostic platforms, including molecular residual disease testing and AI-enabled tumour profiling, where clinical utility can influence treatment selection and improve patient outcomes. The portfolio's outperformance was driven by a deliberate tilt away from commoditised laboratory equipment providers and toward high-margin, technology-enabled diagnostic companies. Investments in entities pioneering molecular residual disease (MRD) testing and leveraging artificial intelligence for tumour profiling provided significant fundamental growth, as these technologies increasingly dictated targeted therapy selection in oncology.
Whilst Healthcare Services detracted -3.3% from the portfolio's absolute performance, the corresponding benchmark was down -3.5%. This marginal excess return was primarily the result of the portfolio's underweight allocation. Sector margins came under pressure for managed care organisations during the period and companies with prominent Medicare exposure experienced significant share price pressure. We identified these structural headwinds and reduced exposure to mitigate losses during the financial year.
The MedTech sub-sector was the primary detractor from absolute and excess performance in the financial year. Specifically, MedTech detracted -5.4% from the portfolio's absolute return, underperforming the Benchmark's -3.0% drag and costing the fund 240 basis points in excess return. While the underlying demand for surgical intervention remained structurally sound, the sector had entered the financial year trading at premium valuation multiples that required flawless execution. Boston Scientificwas the prototypical example where a small misstep in commercial operations and a clinical data announcement on a new cardiovascular device triggered investor concern. Estimates were lowered, the multiple collapsed, and the share price faltered.
PRIVATE HOLDINGS
For the full year ended 31 March 2026, the Company strategically refrained from making new investments in unquoted companies. While we continue to see significant improvement in the capital markets for small and mid-cap healthcare companies, we have remained on the sidelines with respect to new unquoted investments.
During the financial year, the unquoted portfolio saw three exits. Caris Life Sciences, a precision medicine company that specialises in molecular profiling and AI-driven cancer diagnostics to guide personalised treatment decisions, completed its IPO in June 2025. Two other unquoted holdings, Crossover Health, a healthcare services company, and MabPlex International, a Chinese contract research organization, were sold in private transactions. We are confident that more of the Company's unquoted investments will achieve listings within the next year as the capital market funding environment further improves.
At the end of the year, unquoted investments made up 2.6% of the portfolio, compared to 6.1% at the end of the previous year. For the full year ended 31 March 2026, the market value of the Company's unquoted investments fell by £17.8 million, from an opening value of £106.8 million across nine companies.
The remaining unquoted portfolio is concentrated in Healthcare Services, with smaller exposures to Biotechnology and MedTech. Geographically, exposure is predominantly in Emerging Markets, with a minor allocation to North American companies. The Company continues to monitor funding requirements, exit opportunities, and valuation developments across the remaining unquoted holdings.
MAJOR CONTRIBUTORS TO PERFORMANCE
The top contributor for the full year was the Company's proprietary swap basket of M&A targeted securities, the Biotech M&A basket'. The basket returned +55.9% (sterling) during the year, on an absolute basis, significantly outperforming the Emerging Biotechnology portion of the benchmark which returned +19.2%. This outperformance was driven by a concerted effort to populate the basket with Emerging and Commercial stage biotechnology companies, selected by the manager through a variety of factors. We use an ongoing screening process including but not limited to the examination of (1) therapeutic area, (2) clinical innovation, (3) management teams that are willing sellers, and (4) capital situation. Further discussion of the basket performance is contained below (see Derivative Strategy below). Outright investments in the portfolio were also M&A targets during the financial year, three of which were major contributors to performance and are detailed below.
On an individual security basis, AstraZenecawas the largest contributor in the financial year, contributing +228 basis points to NAV performance. Over the reported period, the company solidified its status as the premier global, diversified, pharmaceutical player with leading franchises in oncology, respiratory, rare disease, and cardiovascular disease. The breadth of AstraZeneca'sinnovation remains impressive; with a plethora of announced Phase 3 clinical trials and a portfolio of 16 distinct blockbuster medicines. Key drivers of share price appreciation included the flawless commercial execution of its new and existing blockbuster medicines: the continued dominance of Enhertu (trastuzumab deruxtecan) across multiple HER-2+-expressing solid tumours, the successful launch of Datroway (datopotamab deruxtecan) in advanced EGFR-mutated non-small cell lung cancer, and the expansion of the rare disease portfolio via the subcutaneous formulation of Saphnelo (anifrolumab), a novel biologic approved to treat moderate to severe systemic lupus erythematosus (SLE) in adults. While Datroway was one positive element of AstraZeneca'syear, it should be viewed in the context of a much broader and more diversified investment case. AstraZenecabenefited from strong execution across oncology, respiratory, rare disease, and cardiometabolic franchises, meaning the market rewarded the company for breadth, pipeline depth, and commercial delivery rather than for a single product alone.
California-based CG Oncology, a late-stage yet emerging clinical biopharmaceutical company focused on urologic cancers, was a material contributor to performance, contributing +153 basis points to NAV performance. The company's share price gains in the year were driven by flawless clinical execution of its lead asset, cretostimogene, a highly novel oncolytic immunotherapy. Throughout the financial year, the company presented impressive data from the Phase 3 BOND-003 trial for patients with high-risk, BCG-unresponsive non-muscle invasive bladder cancer (NMIBC). The data demonstrated an unprecedented 95.7% complete response rate at three months, with best-in-disease durability. The company initiated a rolling Biologics License Application (BLA) submission to the FDA with expected approval in 2026. The share price gains also reflect CG Oncologyas a prime acquisition target poised to redefine the standard of care in a massive, underserved oncology indication.
A dominant force in non-invasive cancer screening, ExactSciences, was another top contributor to performance, contributing +147 basis points to NAV performance after the company was acquired by Abbott for U.S.$21 billion, a +35% premium in November 2025. Impressive financial results and pushing the frontiers of innovation in their pipeline made the company an attractive target. Exact Sciencesfocuses on the early detection of cancer and supporting personalized treatments. The company's comprehensive product offerings support patients and their healthcare providers before, during and after a cancer diagnosis. The company is a leader in cancer screening, precision oncology and genetic testing, helping to detect cancer earlier, guide treatment decisions and monitor for recurrence. The core Cologuard franchise (non-invasive, at-home stool DNA-based test to detect colorectal cancer) continued to capture market share. Concurrently, Exact Sciencesdemonstrated profound pipeline progression in precision oncology.
The portfolio's strategic focus on next-generation genetic medicines was validated by another California-based company, Avidity Biosciences, contributing +147 basis points to NAV performance. The company is the pioneer of Antibody Oligonucleotide Conjugates (AOCs), a revolutionary new modality that solves the historical challenge of delivering RNA therapeutics to specific tissues (like muscle) by conjugating them to monoclonal antibodies. Avidity generated a continuous stream of clinical data throughout 2025, demonstrating statistically significant improvements in dystrophin production for Duchenne Muscular Dystrophy (DMD) and consistent functional improvements in Facioscapulohumeral Muscular Dystrophy (FSHD). In October 2025, Novartis announced a definitive agreement to acquire Avidityfor U.S.$12.0 billion, representing a >60% premium. The proposed acquisition prompted Novartisto raise its own total company sales outlook from +5% to +6% CAGR for 2029, underscoring the commercial potential offered by Avidity'spipeline.
Apellis Pharmaceuticals, a Massachusetts-based commercial stage biotechnology company rounds out the prominent M&A theme that has characterised much of the performance of the portfolio over the past 12 months, contributing +164 basis points to NAV performance. On the final trading day of the financial year, 31 March 2026, Biogen announced a definitive agreement to acquire Apellisfor U.S.$41.00 per share in cash, an impressive 140% premium to the prior day's closing price, equating to an upfront equity valuation of approximately U.S.$5.6 billion. Apellis is an undisputed pioneer in targeted C3 complement therapies. Its flagship asset, Syfovre (pegcetacoplan), is the first and only FDA-approved treatment for geographic atrophy, a devastating and irreversible cause of blindness. The company also markets Empaveli for the treatment of paroxysmal nocturnal haemoglobinuria (PNH).
MAJOR DETRACTORS TO PERFORMANCE
MedTech stock, Boston Scientific, was the portfolio's single largest detractor in the financial year, detracting -421 basis points to NAV performance. After a multi-year re-rating in which the company's share price tripled from 2022 and reached an all-time high on 9 September 2025, the company finally stumbled. Share price weakness began in earnest in the second half of the year. Positive drug pricing news at the end of September triggered a rotation into Pharmaceuticals from MedTech. A mix of profit taking, momentum shift, and investor concern about share loss in the multi-billion dollar ablation business pushed the share price down even further. In January, the stock fell lower still after the company reported fourth quarter financials. Of note was a modest but clear revenue miss for the company's key new product, Farapulse (for the treatment of atrial fibrillation). The unexpected miss startled investors and significantly hurt management credibility, whilst share price pressure was exacerbated by macro concerns (continued rotation into pharma, lower healthcare utilisation trends, and rising geopolitical concerns). Share price declines continued into the year end, gapping down one more time in late March after investor questions arose over the CHAMPION data set, a clinical trial demonstrating the use of the WATCHMAN implantable device (compared to oral anticoagulants) used to prevent strokes in patients afflicted with atrial fibrillation. Whilst we reduced our holding in Boston Scientificon multiple occasions in the second half (and to Medical Technology by >1000 basis points over the year), the stock remains a prominent holding in the portfolio given our view that the distressed valuation expresses investor fear rather than quality management and a still robust growth outlook fuelled by innovation.
The managed care titan, UnitedHealth, was the second-largest detractor in the financial year, detracting -340 basis points to NAV performance. Overall, the confluence of soaring costs, shrinking patient enrolment, a massive cyber attack in the previous year, and a difficult government rate-setting environment caused a structural de-rating of the company's valuation, dragging down the entire services subsector. Unfortunately, UnitedHealth'sshare price in April 2025 marked the high. The company stumbled out of the gate after missing quarterly earnings and significantly lowering its 2025 outlook. The company cited higher-than-expected medical costs in its Medicare business, an issue that has affected the entire industry over the past year. Unfortunately, the utilisation trends in healthcare were trending higher than the company expected, severely impacting profits. News of the CEO resigning and subsequent headlines of a Department of Justice investigation into fraud practices pushed the stock lower. Additional purchases at that time proved premature as the stock eventually reached 52-week lows in August. We ultimately exited the stock before financial year end. Whilst absolute detraction was significant, approaching -350 basis points, the impact on relative return was de minimis (-6 basis points).
Daiichi-Sankyo, the global Japanese pharmaceutical company, remains a leader in antibody-drug conjugate technology and has been central to the development of both Enhertu and Datroway in partnership with AstraZeneca. However, Daiichi Sankyo'sshare price was more sensitive to Datroway-related setbacks than AstraZeneca'sbecause the antibody-drug conjugate platform represents a larger proportion of Daiichi Sankyo'sinvestment case. For AstraZeneca, Datroway was one of many growth drivers across a broad global portfolio; for Daiichi Sankyo, delays and uncertainty around Datroway had a more direct impact on investor confidence in the depth, timing, and profitability of the company's next wave of growth. During the year, investor expectations for Datroway were affected by clinical trial design complexity, evolving biomarker requirements, and delays to key readouts. This has weighed heavily on the share price, detracting -80 basis points to NAV performance. Meanwhile, investor concerns have also increased after a complete turnover of the management and subsequent concerns over profitability and increased R&D spending by the new CEO and CFO. Furthermore, broader macroeconomic pressures and intense volatility in the Japanese yen prompted investors to liquidate Japanese equities, regardless of underlying corporate fundamentals.
Of the many Boston-based biotechnology companies, VertexPharmaceuticals has been one of the most successful and innovative companies from that regional hotbed. The company delivered exceptional full-year 2025 revenue of U.S.$12.0 billion, driven by its monopoly in cystic fibrosis (CF) and their suite of highly effective therapies. But the company thus far has struggled for an encore. In 2025, the company's share price underperformed due to negative clinical updates for its emerging pain franchise, detracting -68 basis points to NAV performance. Most important was the Phase 2 failure of its next-generation acute pain treatment (VX-993). Furthermore, the FDA informed the company that it would not approve a broad label in peripheral pain for its first-generation product, Journavx (suzetrigine). Given more limited prospects for the pain franchise and slowing growth for its lead CF franchise, we exited the position.
Stryker is a global leader in medical technology offering a variety of innovative products and services in Medical Surgery, Neurotechnology and Orthopaedics. Whilst largely executing above industry average, the share price came under pressure in the latter half of the financial year, detracting -53 basis points to NAV performance. First, the stock was pressured by a macro rotation out of MedTech stocks - in part due to rotation into therapeutics and in part due to the " Boston ScientificEffect" - in which high-multiple medical device manufacturers sold off, highlighting the vulnerability of the sector to sudden shifts in investor sentiment regarding hospital capital expenditures. Second, the stock was also pressured by investor scepticism around volume growth, despite a fourth quarter increase in net sales of +11.4%. However, we note that management has consistently overdelivered on its commitments, and we expect this to remain part of the algorithm in 2026 and beyond as it advances the "super cycle" of innovation, including new cameras, power tools, defibrillators, and plating systems which are launching across different geographies. Hence, we continued to own the stock into year-end.
DERIVATIVE STRATEGY
The Company has the ability to use equity swaps and options as part of its financial strategy. Equity swaps are a financial tool (a derivative contract) that allow for synthetic exposure to a single stock (Single Stock Equity Swaps) or a group of stocks (Equity Basket Swaps).
Equity basket swaps are typically constructed within a well-defined theme; the basket format facilitates efficient management of the investment theme and easier tracking of performance. For example, maintaining 15 to 50+ additional positions at smaller weights (i.e. non-core) directly in the portfolio is often suboptimal. The equity basket swap contains multiple single stock long positions, with Goldman Sachs acting as the counterparty, ensuring confidence in forward trading and rebalancing strategies.
The Company strategically invested in one customised tactical basket swap targeting growth opportunities in undervalued small and mid-capitalisation Biotechnology, Pharmaceutical, and MedTech companies. This basket was constructed to capitalise on investment opportunities possessing considerable potential as attractive acquisition targets for larger corporations (Biotech M&A basket). The basket was one of the key differentiators of performance during the year, returning +55.9% in sterling and generating £75.3 million, equivalent to 5.6% of the Company's total return for the financial year. Single stock equity swaps, used to gain exposure to China and India, gained £7.3 million.
LEVERAGE STRATEGY
Historically, the typical leverage level employed by the Company has been in the low-double digit to mid-to-high teens range, with an average of +11%. Considering the market volatility during the past five plus financial years, we have tended to use leverage in a more tactical fashion in recent periods.
In 2025, we have flexed leverage more notably than in some prior financial years, going as low as +9% (coming out of President Trump's "Liberation Day" tariff announcements, which created some market tumult and uncertainty) and as high as +20% (as performance inflected and our bullishness for a sustained move in Biotechnology and Emerging Markets increased).
The Company ended the period with 12.5% leverage, a result of the final trading day of the financial year, in which multiple M&A transactions were announced, including the announced acquisition of Apellis Pharmaceuticals. This was a prominent holding within the portfolio and was included in the Biotech M&A basket. With an outsized premium of +140%, the total holding for Apellis Pharmaceuticalsballooned to 4.1%, which was sold on the last trading day of the year given the de minimis spread at which the stock traded. This large sale, which was not replaced on the same day, temporarily moved leverage to 12.5%. For context, we exited April 2026 with leverage of 19.0%, more reflective of our bullish stance entering the new financial year.
SECTOR DEVELOPMENTS
Without question, the most significant development in healthcare during the financial year, and perhaps the most significant development in the past decade, was the substantial clarification, but not full elimination, of uncertainty surrounding U.S. drug pricing policy and pharmaceutical tariffs.
Whilst constant threats and rhetoric have rained from Washington DC for years, President Trump during his second term has been surprisingly vocal (and negative) towards the Biopharma industry. What does President Trump want from the Biopharma industry? Some things are clear, including (1) re-shoring of drug manufacturing in the U.S., (2) ensure U.S. taxes are being paid by minimising manufacturing/IP loopholes, (3) address national security concerns given the absence of domestic antibiotic and vaccine manufacturing, (4) increase investment in U.S.-based R&D facilities, manufacturing, and employment, and (5) maintain the innovation lead over China, which has narrowed materially over the past two years.
On the drug pricing front, we believe President Trump wants to alter the broad ecosystem of prescription drug pricing, such as (1) making developed countries "pay their fair share" for innovative drugs and raise drug prices ex-U.S., (2) lower list prices for cash-paying Americans, (3) lower out-of-pocket expenses for most impoverished Americans and seniors, and (4) tackle the issue of "middlemen", the managed care providers who absorb 50-60% of the value of prescription medicines in the U.S.
The first domino fell on 31 July 2025, when President Trump sent letters to 17 of the largest and most influential biopharmaceutical companies in the world, detailing this list of demands. The second domino fell on 30 September 2025, when an unexpected landmark agreement between the Trump Administration and Pfizerwas announced. The deal rapidly closed much of the uncertainty around both tariffs and drug pricing in one sweeping package between the two sides.
First, a new online website was created, called "TrumpRx. gov", where cash-paying Americans will be able to fill their prescriptions at prices that will be up to 85% lower than current list prices, with an average discount of 50%. This is a win for Pfizer(and ultimately the entire industry) as this level of discount (50% off list prices) is already what drug makers sell to Managed Care and PBMs in the commercial sales channel. In fact, we may see a dramatic increase in cash pay volumes given this new pricing scheme in what was otherwise a de minimis sales opportunity historically. And of course, this is a win for the Administration as the pledge of "lowering prescription drug prices by 80%" was not only achieved but exceeded.
Second, on tariffs, Pfizerreceived a complete stay on tariffs (for a minimum of three years) for accepting several specific deal terms, in addition to TrumpRx. This included a pledge to commit up to U.S.$70 billion in U.S. manufacturing and R&D investments "over the next few years", building upon the U.S.$83 billion that Pfizerinvested over the previous seven years. This is a clear win for President Trump and mostly just "business as usual" for Pfizerfrom a capex perspective. We do note that over a dozen large cap pharmaceutical companies, such as Eli Lilly, GSK, and JNJ to name a few, have already publicly pledged U.S. investments across manufacturing and R&D, an amount totalling a staggering U.S.$432 billion over the next 3-10 years (source: company filings; Bloomberg).
Surprisingly, Pfizeralso agreed to terms on a Most Favoured Nation (MFN) drug pricing scheme, one area about which investors were most concerned. However, based on the details that were disclosed, the outcome appears to be rather benign for Pfizer. MFN pricing today will apply only to current Medicaid patients, where prices are already low, and represents only 2.5% of total company sales. We estimate that pricing compression here will result in <1% hit to Pfizer's topline, a manageable impact. A clear win for Pfizer. For President Trump, a double win: a key industry player agrees to MFN and a headline win of lowering out-of-pocket expenses for the lowest-income Americans.
Finally, Pfizeragreed to MFN pricing to be applied to all new products going forward, across both Medicaid and Medicare channels. A blow to the industry? Hardly. Whilst most details have been kept confidential, what details we do know are suggestive of a benign outcome. Here, Pfizer will not be able to launch a new product ex-U.S. below the price in the U.S. The net effect of this will be that the MFN price and the U.S. price will largely be the same, thereby avoiding any current or future pricing pressure in the U.S. This will also increase prices in foreign countries, a goal of President Trump. Applying this price scheme to only new products will prevent any immediate budgeting issues in foreign lands, rather, there will be a new 10-year runway for foreign payers to adjust budgets and redirect a proportion of GDP to drug spending, so that they "pay their fair share" for innovation going forward. Again, countries not electing to accept these new prices will forego life-saving innovations and/or will be subject to (or at least threatened with) harsh tariffs.
The Pfizeragreement triggered an additional 16 dominoes in which, over the subsequent seven months into April 2026, the 16 other companies that received the letter also agreed to similar if not identical terms as Pfizer.
The market quickly recognised the win/win nature of these deals, a de-risking development that materially reduced the near-term risk of broad, punitive tariffs and draconian price cuts for companies agreeing terms with the Administration. However, tariff risk remains a live policy issue, particularly for companies without agreement, companies with more complex supply chains, and any future changes in implementation, but offers sales volume expansion facilitated by the TrumpRx platform, higher European pricing floors, and avoidance of any material domestic margin compression. This realisation triggered the pharmaceutical equity rally witnessed in late 2025.
Throughout 2025, the FDA experienced intense internal turmoil as its regulatory philosophy underwent a radical shift under President Trump's second term as President. Under the leadership of Commissioner Martin Makary, the agency pushed aggressively for deregulation, proposing highly controversial new standards that would require only one major clinical trial for most drug approvals and prioritizing raw speed-to-market over traditional evidentiary burdens. We applaud many of the progressive ideas put forth by the new Commissioner. His early emphasis was on transparency, "common sense" regulation, and restoring trust in the FDA has been welcome to investors. His desire to lean toward regulatory flexibility: e.g., streamlining reviews, moving away from overly burdensome regulation, using less animal testing, and giving more weight to diverse types of evidence has been surprisingly progressive. He has also spent time addressing agency culture and trying to do "less with more" given budgetary cuts he continues to be forced to deal with.
Perhaps Dr. Makary's signature program thus far is the Commissioner's National Priority Voucher (CNPV) program, a pilot "voucher-style" initiative under which selected drug developers can receive a voucher that entitles them to a significantly shortened review timeline for a new drug or biologic, from 10 to 12 months to as little as one to two months. Selection is focused on criteria that investors are likely to value, such as (1) a health crisis in the U.S. like COVID-19, (2) tackling a large unmet public health need, and (3) a drug candidate that delivers innovative cures.
Eli Lillyreceived one such voucher, a byproduct of its own price negotiation deal. In an unprecedented event, CEO Dave Ricks negotiated on price for a prescription medicine that had not even been approved yet - orforglipron - an oral, small molecule GLP-1 agonist for diabetes and weight loss. In return for concessions on price, the company received a voucher it ultimately used when it filed orforglipron in February 2026 and received approval only 50 days later on 1 April 2026.
An additional byproduct of these negotiations was support for GLP-1 medicines by President Trump and new head of Centres for Medicare & Medicaid Services, Dr. Mehmet Oz. Specifically, the federal government agreed to conditions for inclusion and reimbursement for GLP-1 medications in Medicare Part D, the prescription benefit plan for American seniors. This would allow access for nearly 70 million Medicare beneficiaries to medicines like Wegovy, Zepbound, and orforglipron (brand name Foundayo) for as little as U.S.$25 per month. We expect this to be a significant secular tailwind for this class of drugs.
This aggressive agenda, however, clashed with the established scientific rigour of the Centre for Biologics Evaluation and Research (CBER). Vinay Prasad, the polarising Director of CBER, emerged as a fierce internal critic of this more modern, progressive approach. Prasad's tenure was marked by severe friction with both the biotechnology industry and his superiors, culminating in his highly controversial refusal to review Moderna's mRNA influenza vaccine and his stringent demand for an additional clinical trial for uniQure'sHuntington's disease gene therapy.
Following a period of internal disagreement over the FDA's regulatory approach, Vinay Prasad departed CBER after a brief and controversial tenure. Subsequent to the Company's year-end, Commissioner Martin Makary also left the FDA, with Kyle Diamantas appointed Acting Commissioner. The leadership changes introduce some near-term uncertainty around policy continuity and regulatory execution. However, several of the FDA's recent pro-innovation initiatives, including accelerated review pathways and greater flexibility for rare disease and genetic medicine development, appear likely to remain areas of focus. Overall, we would rate the health of the FDA as good, despite some of the leadership turnover that has plagued the current Administration. We continue to view the FDA as broadly supportive of medical innovation, but recent leadership turnover means the near-term regulatory environment should be regarded as less settled than it appeared earlier in the year.
Looking at novel approvals in 2025, the FDA approved 52 new molecular entities (NMEs) across CDER and CBER, representing a decline from 59 in 2024 but only modestly below the average of 55 that has characterised the most recent 10-year innovation cycle. The quality of approvals remained high, with a continued emphasis on scientifically novel, targeted therapies, particularly in oncology, rare diseases, and precision medicine, alongside notable first-in-class mechanisms (e.g., new pain and immunology pathways). Small molecules dominated (about two-thirds of approvals), but the class was diverse across modalities, including monoclonal antibodies, ADCs, siRNA, and other advanced platforms. Oncology again accounted for the largest share, though innovation extended into infectious disease (e.g., novel antibiotics) and chronic conditions, reflecting a balance of breakthrough science and unmet-need targeting. Whilst slightly lower in volume, 2025 approvals were characterised by continued productivity and increasing precision in pharmaceutical development, rather than sheer breadth, reinforcing the trend toward more targeted, mechanism-driven drug development.
Artificial intelligence (AI) continued to develop as an important enabling technology across healthcare, rather than as a standalone pure-play investment category for the portfolio. Its most immediate benefits are in drug discovery, clinical trial design, imaging, diagnostics, and workflow automation. The portfolio's exposure is therefore primarily through companies that use AI to improve R&D productivity, clinical decision-making, diagnostic accuracy or operating efficiency, rather than through companies whose investment case depends solely on AI.
Biotechnology M&A continued at a brisk pace in 2025, and after a brief slowdown to start 2026, inflected yet again into the financial year-end. A total of 51 deals, representing over U.S.$140 billion, made it one of the busiest years on record, driven by a series of large, strategic transactions as large pharma and biotech companies sought to offset patent expiries and replenish pipelines. A mix of mid- to large-cap acquisitions and multibillion-dollar "bolt-on" deals characterised the deals as acquirers focused on de-risked, late-stage or commercial assets, particularly in high-value areas like obesity, oncology, neuroscience, and rare disease, often paying premiums for validated science and near-term revenue potential. Overall, 2025 marked a return of confidence in biotech M&A, but with a higher bar for scientific validation and commercial relevance, signalling a more selective and mature dealmaking environment, one that we expect to continue in 2026. With over U.S.$250 billion in legacy revenue facing generic or biosimilar competition through 2030, a number of large-capitalisation companies possess the motivation to acquire growth and balance sheets remain strong.
China's biotechnology ecosystem also became an increasingly important source of innovation for global pharmaceutical companies. While geopolitical risk remains a consideration, the volume and quality of China-originated assets available for licensing has continued to improve, and U.S. and European pharmaceutical companies are increasingly looking to China as a source of novel medicines that can be advanced through global development programmes. A notable post-period example was BristolMyers Squibb's collaboration with Jiangsu Hengrui Pharma, announced in May 2026, covering 13 early-stage programmes across oncology, haematology, and immunology. Under the agreement, BMS will pay Hengrui up to U.S.$950 million, including a U.S.$600 million upfront payment, with total potential deal value of approximately U.S.$15.2 billion if all options and milestones are achieved.
OUTLOOK
The year ended 31 March 2026 was a defining period for Worldwide Healthcare Trust, marked by exceptional relative performance against a highly volatile market backdrop. Despite severe macroeconomic shocks, geopolitical instability, and prolonged uncertainty around U.S. healthcare policy, the Company delivered strong absolute returns and substantial outperformance versus the MSCI World Health Care Index.
As the portfolio transitions into the 2026 financial year, the fundamental state of the global healthcare industry remains exceptionally strong, underpinned by a continued wave of scientific innovation and the significant deployment of corporate capital. Whilst the macroeconomic environment remains uncertain, dictated by the ongoing energy shock stemming from the Iran conflict and the debate over central bank monetary policy, the global nature of healthcare demand provides robust structural support for investors.
Looking ahead, we remain constructive on the outlook for global healthcare equities. Greater clarity on key U.S. policy overhangs has materially improved the risk-reward profile for biopharmaceutical companies, although tariff implementation and future policy changes remain potential sources of volatility. At the same time, large-cap pharmaceutical companies continue to face significant patent expiry pressures, creating a strong incentive for continued M&A, particularly in biotechnology, where valuations remain attractive relative to the quality of innovation.
We expect oncology, obesity, rare disease, immunology, neuroscience, genetic medicines, and precision medicine to remain fertile areas for investment. While geopolitical uncertainty, currency volatility, and periodic macroeconomic shocks are likely to persist, the fundamental drivers of healthcare demand remain intact and largely non-cyclical. With a portfolio positioned toward differentiated innovation, high-quality pipelines, and companies with strategic scarcity value, the Company enters the new financial year with confidence in its ability to generate long-term capital growth for shareholders.
Sven H. Borho and Trevor M. Polischuk
OrbiMed Capital LLC
Portfolio Manager
4 June 2026
ENVIRONMENTAL, SOCIAL AND GOVERNANCE AND CLIMATE CHANGE
ORBIMED'S APPROACH TO ESG
The Company's Portfolio Manager, OrbiMed, is guided by its Responsible Investing Policy in its approach to integrating environmental, social and governance ("ESG") issues into its investment processes. The Portfolio Manager seeks to invest in innovative healthcare companies that are working towards addressing significant unmet medical needs, across biopharmaceuticals, medical devices, diagnostics, and healthcare services sectors, globally.
OrbiMed believes that there is a high congruence between companies that seek to act responsibly and those that succeed in building long-term shareholder value. The Portfolio Manager seeks to integrate ESG into the overall investment process, with the objective of maximising investment returns. Investment decisions are based on a variety of financial and non-financial company factors, including ESG information. OrbiMed has appointed a Director - ESG to oversee the integration of ESG analysis.
As a responsible investor, OrbiMed negatively screens potential investments and business sectors that may objectively lead to negative impacts on public health or wellbeing. The importance of robust governance and social safeguards in healthcare has grown significantly; regulators and investors are increasingly scrutinising financially material ESG issues such as clinical trial transparency, equitable access to therapies, and pricing practices. Governance issues, including board structure and executive pay are also financially relevant. For companies which do not have manufacturing and are focused on drug discovery and development, environmental factors such as greenhouse gas (GHG) emissions are not generally regarded as financially material. The Portfolio Manager generally utilises healthcare sector-specific guidance from the Sustainability Accounting Standards Board ("SASB") and in-house analyses to guide its selection of material ESG factors as part of its investment research.
Healthcare and life sciences sectors are highly regulated, globally. Regulation is well-established across developed markets and emerging markets for the sector. To that end, OrbiMed considers compliance with local laws and regulations as one of the factors in its investment evaluation. Depending on the investment, all or a subset of the ESG factors that are financially material and relevant are considered in OrbiMed's research.
MONITORING AND ENGAGEMENT
OrbiMed utilises ESG scores for public equity holdings from third-party service providers. To supplement the information from the third-party service providers, OrbiMed also conducts proprietary analysis on ESG performance. The scores from the third-party service providers are integrated with OrbiMed's analysis onto a business intelligence platform via a programming interface, for regular monitoring. OrbiMed has developed an in-house ESG Controversies Monitor. Any hits from the Controversies Monitor require the analysts to provide their views on material impact.
OrbiMed also generally engages on a regular basis with its portfolio companies through meetings with management, proxy voting, and in some cases, through board representation.
OrbiMed's analysts track financially material ESG information such as safety of clinical trials, drug safety, product safety, ethical marketing, call-backs and other materially relevant factors. As part of these efforts, OrbiMed engages with companies directly or through brokers, and facilitates dialogue and the exchange of leading practices among investors, companies, and other relevant experts on ESG in the healthcare sector.
Between 1 April 2025 and 31 March 2026, a total of 465 proposals came to vote within the Company's portfolio. Of these, 454 were management proposals and 11 were shareholder proposals.
ORBIMED VOTING DURING THE YEAR ENDED 31 MARCH 2026
Total | Votes | |||
Number of | Voted | Voted | Abstained/ | |
Proposed by | Proposals | For | Against | Withheld |
Management | 454 | 413 | 25 | 1 |
Shareholder | 11 | 5 | 6 | 0 |
Most proposals focused on director elections (239), auditors appointments (39), and executive compensation (25). There were several shareholder proposals on golden parachute provisions that came to vote, and one on improving health outcomes. The Portfolio Manager provides a periodic update on ESG to the Board of the Company.
CLIMATE CHANGE
The Company published its TCFD-based report on its website in September 2025. As per the guidance from SASB, climate change is not a material ESG consideration for the biotechnology and pharmaceutical, medical equipment and supplies and managed care sectors. However, energy management is noted as a material ESG concern for the healthcare delivery sector. To that end, OrbiMed includes the scores on energy management for the relevant sectors in its overall ESG monitoring.
Sven H. Borho and Trevor M. Polischuk
OrbiMed Capital LLC
Portfolio Manager
4 June 2026
BUSINESS REVIEW
The Strategic Report, on pages 1 to 45 of the Annual Report, contains a review of the Company's business model and strategy, an analysis of its performance during the financial year and its future developments and details of the principal risks and challenges it faces. Its purpose is to inform shareholders in the Company and help them to assess how the Directors have performed their duty to promote the success of the Company.
The Strategic Report contains certain forward-looking statements. These statements are made by the Directors in good faith based on the information available to them up to the date of this report. Such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying such forward-looking information.
BUSINESS MODEL
Worldwide Healthcare Trust PLC is an externally managed investment trust. Its shares are admitted to the closed - ended investment funds category of the FCA's Official List and to trading on the main market of the London Stock Exchange.
The purpose of the Company is to achieve a high level of capital growth for its shareholders by offering a single investment that provides exposure to the global healthcare sector. This is achieved through a diversified portfolio of shares in pharmaceutical, biotechnology and other healthcare related companies.
The Company's investment objective and policy are detailed on pages 10 and 11 of the Annual Report.
The Company's strategy focuses on creating shareholder value by meeting its investment objective.
As an externally managed investment trust, the Company outsources all day-to-day management and administrative functions. Consequently, it has no executive directors, employees or internal operations. The Company engages the following key service providers: Frostrow Capital LLP ("Frostrow") as its Alternative Investment Fund Manager ("AIFM"); OrbiMed Capital LLC ("OrbiMed") as its Portfolio Manager; J.P. Morgan Europe Limited as its Depositary; and J.P. Morgan Securities LLC as its Custodian and Prime Broker. Further details about these appointments can be found in the Business Review.
The Board retains responsibility for all aspects of the Company's affairs, including:
· Setting and monitoring the investment strategy;
· Reviewing investment performance and policy; and
· Overseeing strategic matters such as dividend policy, share issuance and buybacks, gearing, share price monitoring, and corporate governance.
The Company qualifies as an investment company under Section 833 of the Companies Act 2006 and has been approved by HM Revenue & Customs as an investment trust under Section 1158 of the Corporation Tax Act 2010. This approval exempts the Company from taxation on capital gains. The Directors have no reason to believe that this status will not be maintained. Additionally, the Company is not considered a close company for taxation purposes.
CONTINUATION OF THE COMPANY
A resolution was passed at the Annual General Meeting ("AGM") held in 2024 that the Company continues as an investment trust for a further five year period. In accordance with the Company's Articles of Association, shareholders will have an opportunity to vote on the continuation of the Company at this year's AGM and every five years thereafter.
THE BOARD
The Board of the Company comprises Doug McCutcheon (Chair), Sven Borho, Sian Hansen, William Hemmings, Tim Livett, Jo Parfrey and Dr Bina Rawal. All of these Directors served throughout the year. All are independent non-executive Directors with the exception of Sven Borho who is not considered to be independent by the Board.
All Directors, with the exception of Doug McCutcheon, are seeking re-election by shareholders at this year's AGM.
DIVIDEND POLICY
It is the Company's policy to pay out dividends to shareholders at least to the extent required to maintain investment trust status for each financial year. Such dividends will typically be paid twice a year by means of an interim dividend and a final dividend.
COMPANY PROMOTION
The Company has appointed Frostrow to provide marketing and investor relations services, in the belief that a well-marketed investment company is more likely to grow over time, have a more diverse and stable shareholder register and trade at a superior rating to its peers.
Frostrow actively promotes the Company in the following ways:
Engaging regularly with institutional investors, discretionary wealth managers and a range of execution-only platforms: Frostrow regularly talks and meets with institutional investors, discretionary wealth managers and execution-only platform providers to discuss the Company's strategy and to understand any issues and concerns, covering both investment and corporate governance matters;
Making Company information more accessible: Frostrow works to raise the profile of the Company by targeting key groups within the investment community, holding annual investment seminars, overseeing PR output and managing the Company's website and wider digital offering, including Portfolio Manager videos and social media;
Disseminating key Company information: Frostrow performs the Investor Relations function on behalf of the Company and manages the investor database. Frostrow produces all key corporate documents, distributes monthly Fact Sheets, the Interim and Annual Report and updates from OrbiMed on portfolio and market developments; and
Monitoring market activity, acting as a link between the Company, shareholders and other stakeholders: Frostrow maintains regular contact with sector broker analysts and other research and data providers, and conducts periodic investor perception surveys, liaising with the Board to provide up-to-date and accurate information on the latest shareholder and market developments.
KEY PERFORMANCE INDICATORS ("KPIs")
The Board assesses the Company's performance in meeting its objectives against KPI's as follows. The KPI's have not changed from the previous year:
· Net asset value ("NAV") per share total return* against the Benchmark;
· Discount/premium of share price to NAV per share*; and
· Ongoing charges*.
* Alternative Performance Measure (see Glossary)
Information on the Company's performance is provided in the Statement from the Chair and the Portfolio Manager's Review and a record of these measures is shown on pages 3, 4 and 5 of the Annual Report. Further information can be found in the Glossary.
NAV per share total return* against the Benchmark
The Directors regard the Company's NAV per share total return as being the overall measure of value delivered to shareholders over the long term. This reflects both net asset value growth of the Company and dividends paid to shareholders.
The Board considers the most important comparator, against which to assess the NAV per share total return performance, to be the MSCI World Health Care Index measured on a net total return, sterling adjusted basis (the 'Benchmark').
OrbiMed has flexibility in managing the investments and are not limited by the make-up of the Benchmark. As a result, investment decisions are made that differentiate the Company from the Benchmark and therefore the Company's performance may also be different from that of the Benchmark.
A full description of performance during the year under review is contained in the Portfolio Manager's Review.
Share price discount/premium to NAV per share*
The share price discount/premium to the NAV per share is considered a key indicator of performance as it impacts the share price total return of shareholders and can provide an indication of how investors view the Company's performance and its Investment Objective.
Ongoing charges*
The Board continues to be conscious of expenses and works hard to maintain a balance between good quality service and costs.
As at 31 March 2026 the ongoing charges figure was 0.9% (2025: 0.8%).
* Alternative Performance Measure (See Glossary).
PRINCIPAL SERVICE PROVIDERS
The principal service providers to the Company are: the AIFM, Frostrow; the Portfolio Manager, OrbiMed; the Custodian and Prime Broker J.P. Morgan Securities LLC; and the Depositary, J.P. Morgan Europe Limited. Details of their key responsibilities follow and further information on their contractual arrangements with the Company are included in the Report of the Directors.
Alternative investment fund manager ("AIFM")
Frostrow under the terms of its AIFM agreement with the Company provides, inter alia, the following services:
· oversight of the portfolio management function delegated to OrbiMed;
· portfolio administration and valuation;
· risk management services;
· marketing and shareholder services;
· share price discount and premium management;
· administrative and secretarial services;
· advice and guidance in respect of corporate governance requirements;
· maintenance of the Company's accounting records;
· maintenance of the Company's website;
· preparation and dispatch of annual and half-year reports (as applicable) and monthly fact sheets; and
· ensuring compliance with applicable legal and regulatory requirements.
During the year, under the terms of the AIFM Agreement, Frostrow received a fee as follows:
On market capitalisation up to £150 million: 0.3%; in the range £150 million to £500 million: 0.2%; in the range £500 million to £1 billion: 0.15%; in the range £1 billion to £1.5 billion: 0.125%; over £1.5 billion: 0.075%. In addition, Frostrow receives a fixed fee per annum of £57,500.
Portfolio manager
OrbiMed under the terms of its portfolio management agreement with the AIFM and the Company provides, inter alia, the following services:
· the seeking out and evaluating of investment opportunities;
· deciding on the manner by which monies should be invested, disinvested, retained or realised;
· advising on how rights conferred by the investments should be exercised;
· analysing the performance of investments made; and
· advising the Company in relation to trends, market movements and other matters which may affect the investment objective and policy of the Company. OrbiMed receives a base fee of 0.65% of NAV and a performance fee of 15% of outperformance against the Benchmark as detailed on page 48 of the Annual Report.
Depositary, custodian and prime broker
J.P. Morgan Europe Limited acts as the Company's Depositary and J.P. Morgan Securities LLC as its Custodian and Prime Broker.
J.P. Morgan Europe Limited, as Depositary, must take reasonable care to ensure that the Company is managed in accordance with the Financial Conduct Authority's Investment Funds Sourcebook, the AIFMD and the Company's Articles of Association. The Depositary must in the context of this role act honestly, fairly, professionally, independently and in the interests of the Company and its shareholders.
The Depositary receives a variable fee based on the size of the Company as set out on page 48 of the Annual Report.
J.P. Morgan Europe Limited has discharged certain of its liabilities as Depositary to J.P. Morgan Securities LLC. Further details of this arrangement are set out on page 49 of the Annual Report. J.P. Morgan Securities LLC, as Custodian and Prime Broker, provides the following services under its agreement with the Company:
· safekeeping and custody of the Company's custodial investments and cash;
· processing of transactions;
· provision of an overdraft facility. Assets up to 140% of the value of the drawn overdraft can be taken as collateral; and
· foreign exchange services.
AIFM AND PORTFOLIO MANAGER EVALUATION AND RE-APPOINTMENT
The performance of the AIFM and the Portfolio Manager is reviewed continuously by the Board and the Management Engagement & Remuneration Committee (the "Committee") with a formal evaluation being undertaken each year. As part of this process, the Committee monitors the services provided by the AIFM and the Portfolio Manager and receives regular reports and views from them. The Committee also receives comprehensive performance measurement reports to enable it to determine whether or not the performance objectives set by the Board have been met. The Committee reviewed the appropriateness of the appointment of the AIFM and the Portfolio Manager in March 2026 with a positive recommendation being made to the Board.
The Board believes the continuing appointment of the AIFM and the Portfolio Manager, under the terms described on page 48 of the Annual Report is in the interests of shareholders as a whole. In coming to this decision, it took into consideration, inter alia, the following:
· the quality of the service provided and the depth of experience of the company management, company secretarial, administrative and marketing team that the AIFM allocates to the management of the Company; and
· the quality of the service provided and the quality and depth of experience allocated by the Portfolio Manager to the management of the portfolio and the long-term performance of the portfolio in absolute terms and by reference to the Benchmark.
RISK MANAGEMENT
The Board is responsible for the management of risks faced by the Company. Through delegation to the Audit & Risk Committee, the Board has established procedures to manage risk, to review the Company's internal control framework and establish the level and nature of the principal risks the Company is prepared to accept in order to achieve its long-term strategic objective. At least twice a year the Audit & Risk Committee carries out a robust assessment of the principal risks and uncertainties with the assistance of Frostrow (the Company's AIFM) identifying the principal risks faced by the Company.
These principal risks and the ways they are managed or mitigated are detailed below. Further details on financial risks and exposure to them is included in note 16.
Principal risks and uncertainties | Mitigation |
Market risks | |
Systematic market risks By the nature of its activities, the Company's portfolio is exposed to fluctuations in market price (both individual security prices and FX rates) and due to exposure to the global healthcare sector, it is expected to have higher volatility than the wider market. As such investors should be aware that by investing in the Company they are exposing themselves to market risks and those additional risks specific to the sectors in which the Company invests, such as political interference in drug pricing. | While this risk is accepted as inherent to the nature of the Company's objective the Board monitor exposures and ensure that the risk is adequately disclosed to investors. In addition, the Board and the AIFM have appointed OrbiMed to manage the portfolio within the remit of the investment objective and policy, and imposed various limits and guidelines, set out on pages 10 and 11 of the Annual Report. These limits ensure that the portfolio is diversified, reducing the risks associated with individual stocks, and that the maximum exposure (through derivatives and an overdraft facility) is limited. The compliance with those limits and guidelines is monitored daily by Frostrow and OrbiMed and reported to the Board monthly. |
Discount risk The Company is exposed to the risk that, particularly in periods when the investment strategy or its implementation underperforms, it may become less attractive to investors. This could lead to reduced demand for the Company's shares, resulting in a widening of the discount between the share price and the Net Asset Value ("NAV") per share. Persistent underperformance, or a lack of clear communication regarding the Company's strategy and positioning, may contribute to negative market sentiment. This can, in turn, affect shareholder confidence and trading liquidity. | In managing this risk the Board: · reviews the Company's Investment Objective and performance in relation to market, and economic, conditions and the operation of the Company's peers; · actively seeks to promote the Company to current and potential investors and have appointed Quill PR to assist with this; and · has implemented an active discount/premium control mechanism. Frostrow have been appointed to provide Investor relations and Company promotional activities. They report to the Board at each Board meeting on these activities. Further information on these activities can be found on pages 34 and 35 of the Annual Report. |
Strategic risks | |
Active Management Risk The appointment of a Portfolio Manager with a high-conviction, actively managed investment style, while potentially enhancing long-term returns, can result in higher portfolio volatility and returns diverging from those of the Benchmark. Such divergence may not align with shareholder expectations for performance consistency relative to the Benchmark and could contribute to share price discount volatility or investor dissatisfaction. | The Board conducts regular and detailed performance reviews of the Portfolio Manager assessing both absolute and relative returns over appropriate time horizons. The investment performance and portfolio is monitored at each Board meeting with scrutiny on performance, concentration, sector weightings, and volatility metrics. The Board on at least an annual basis reviews, and considers, the appointment of the Portfolio Manager to ensure the Portfolio Managers approach aligns with the Company's long-term strategic objectives and shareholder interests. The Company's communications and marketing strategy materials seek to outline the high-conviction, unconstrained nature of the global investment approach. |
Macro economic risk, Geopolitical and regulatory risks The Company's performance may be adversely affected by macroeconomic instability, geopolitical tensions, and changes in global regulatory or fiscal policy. Such risks can lead to market volatility, shifts in investor sentiment, currency fluctuations, and disruptions to the business models of underlying portfolio companies. The U.S. administration may introduce material uncertainty, particularly in relation to healthcare policy, trade relationships, taxation, and regulatory oversight. Given the portfolio's substantial exposure to U.S.-domiciled healthcare companies, political intervention - including reforms to drug pricing, regulatory approval processes, or public healthcare funding - could materially impact the valuations and earnings outlook of certain holdings. Further risks include: · Geopolitical conflict or rising protectionism, which may disrupt supply chains, affect cross-border investment flows, or trigger volatility in global equity markets; · Escalating strategic and economic tensions, in particular, between the United States and China, including the implementation of "U.S.-first" industrial and trade policies, which may incentivise onshoring of manufacturing, impose tariffs or regulatory barriers on non-U.S. production, and disproportionately affect Chinese and other overseas manufacturers. Such developments could disrupt global healthcare supply chains, increase input costs, constrain market access, and adversely impact companies with cross-border manufacturing, sourcing, or revenue exposure to these markets; · Rising levels of cybercrime, particularly where healthcare companies are targeted for sensitive commercial or patient data, potentially leading to operational or reputational damage; · Emerging market exposure, which introduces heightened political risk, legal and regulatory unpredictability, and currency instability. | While macroeconomic and geopolitical events remain outside the direct control of the Company, the Board conducts regular reviews of the broader economic, political, and regulatory environment, in close consultation with the Portfolio Manager. Particular attention is paid to emerging developments that may materially impact the healthcare sector or the geographies in which the portfolio is invested. The Board monitors the execution of the Company's investment strategy in the context of long-term objectives and the evolving risk landscape. This includes reviewing portfolio exposures to specific countries, sectors, and currencies, particularly in relation to areas of heightened geopolitical tension, such as the Middle East and Asia Pacific regions, and in light of potential risks stemming from trade disputes, tariffs, or regulatory reform - including those under the U.S. administration. The Portfolio Manager's risk team undertakes systematic risk analysis, including ongoing monitoring of country-specific, sector-specific, and issuer-level risks. In addition, the Board is supported by a specialist Alternative Investment Fund Manager (AIFM) and Company Secretary, who provide regular updates on market developments, industry regulation, and relevant legislative or tax changes, enabling timely and informed oversight. |
Leverage Risk The Company permits the use of gearing to enhance capital growth. While day-to-day decisions on leverage levels are delegated to the Portfolio Manager (OrbiMed) within Board-approved limits, the strategic setting of these parameters involves balancing the potential for enhanced returns with the risk of amplified losses during market downturns. An inappropriate leverage policy could misalign with shareholder expectations, increase volatility, or result in underperformance relative to the Benchmark. | The Board periodically reviews the Company's leverage limits in consultation with the AIFM and Portfolio Manager, considering market conditions, risk tolerance, and long-term strategic objectives. |
Activism Risk The increasing visibility of activist investors on investment trust share registers poses a potential governance and strategic risk. Activists may seek to influence the Company's investment policy, fee structure, share buyback programme, or strategic direction, which may not align with the Company's long-term objective or those of other shareholders. | In monitoring this risk the Board: · discusses at each Board meeting the Company's future development and strategy; · reviews the shareholder register at each Board meeting; · has implemented an active discount/premium control mechanism; · both the Chair and SID make themselves available to meet with major shareholders, if requested; and, · all Directors attend the AGM are available to answer any questions, and discuss any matters, with shareholders. Frostrow and OrbiMed maintains regular and transparent communication with shareholders. Feedback from shareholders, including any shareholder concerns, are provided to each board meeting. |
Investment risks | |
Performance risks OrbiMed's approach is expected to result in performance that deviates meaningfully from market indices and other healthcare-focused investment companies. While this style may enhance long-term returns, it can also lead to periods of significant under- or outperformance relative to comparators. In addition, the Company employs leverage, both through the use of derivatives and traditional gearing. While leverage is intended to enhance returns, it also increases the Company's exposure to market movements, thereby amplifying both gains and losses. In periods of market volatility or adverse performance, the use of leverage may increase the risk of capital loss and contribute to greater net asset value volatility. | To manage this risk the Board monitor the portfolio (both performance and composition) and compliance with the limits and on an, at least, annual basis consider the re-appointment of the portfolio manager. Investment performance is a primary discussion item at all Board meetings. OrbiMed reports at each Board meeting on the performance of the Company's portfolio, which encompasses the rationale for stock selection decisions, the make-up of the portfolio, potential new holdings and, derivative activity and strategy (further details on derivatives can be found in note 16). |
Unquoted investment risk The Company invests in unquoted companies with the objective of achieving enhanced long-term returns. However, these investments carry a higher degree of risk compared to quoted securities. Unquoted holdings are typically illiquid, meaning they may be more difficult to purchase, realise, or value accurately. As such, their valuations can be more volatile and subject to greater uncertainty than those of listed investments. Valuation of unquoted investments requires significant judgement and is conducted in accordance with the accounting policies set out in Note 1(a). There is a risk that exit proceeds may ultimately be materially lower than the valuations estimated by the Company. In addition, external events beyond the Company's control - including market conditions, political developments, or company-specific events - may significantly affect both the valuation of, and the Company's ability to exit from, these investments. | To mitigate this risk the Board and AIFM have set a limit of 10% of the portfolio, calculated at the time of investment, that can be held in unquoted investments and have established a robust and consistent valuation policy and process as set out in Note 1(b), which is in line with UK GAAP requirements and the International Private Equity and Venture Capital ("IPEV") Guidelines. The Board also monitors the performance of these investments compared to the additional risks involved. |
ESG related risk Both the Board and the Portfolio Manager recognise the importance of maintaining a coherent and credible approach to environmental, social and governance ("ESG") considerations. There is a risk that failure to incorporate ESG factors effectively into the investment decision-making process could negatively impact long-term investment returns. Companies that disregard ESG issues may face regulatory, reputational, or operational challenges that could impair their financial performance. Furthermore, insufficient emphasis on ESG within the Company's investment framework may reduce its attractiveness to current and prospective shareholders, particularly as investor expectations and stewardship standards continue to evolve. A perceived lack of ESG integration could also affect the Company's inclusion in ESG-compliant investment mandates and indices. | The Portfolio Manager provides a periodic update on ESG issues to the Board, highlighting examples where ESG issues influenced investment decisions and/or led to engagement with an investee company. The Portfolio Manager also produces a quarterly ESG update. The Board ensures that the Portfolio Manager's ESG approach is in line with standards elsewhere and the Board's expectations. A summary of the Portfolio Manager's approach to Responsible Investing can be found on page 32 of the Annual Report. |
Operational risks | |
Counterparty risk In addition to market and foreign currency risks, discussed above, the Company is exposed to risk arising from the use of counterparties. If a counterparty were to fail, the Company could be adversely affected through either delay in settlement or loss of assets. The most significant counterparty the Company is exposed to is J.P. Morgan Securities LLC which is responsible for the safekeeping of the Company's assets and provides the overdraft facility to the Company. As part of the arrangements with J.P. Morgan Securities LLC they may take assets, up to 140% of the value of the drawn overdraft, as collateral and have first priority security interest or lien over all of the Company's assets. Such assets taken as collateral may be used, loaned, sold, rehypothecated or transferred by J.P. Morgan Securities LLC. Although the Company maintains the economic benefit from the ownership of those assets it does not hold any of the rights associated with those assets. Any of the Company's assets taken as collateral are not covered by the custody arrangements provided by J.P. Morgan Securities LLC. The Company is, however, afforded protection in accordance with SEC rules and U.S. legislation equal to the value of the assets that have been rehypothecated. | This risk is managed by the Board through: · reviews of the arrangements with, and services provided by, the Depositary and the Custodian and Prime Broker to ensure that the security of the Company's assets is being maintained. Legal opinions are sought, where appropriate, as part of this review. Also, the Board regularly monitors the credit rating of the Company's Custodian and Prime Broker; · monitoring of the assets taken as collateral (further details can be found in note 16); · reviews of OrbiMed's approved list of counterparties, the Company's use of those counterparties and OrbiMed's process for monitoring, and adding to, the approved counterparty list; · monitoring of counterparties, including reviews of internal control reports and credit ratings, as appropriate; · by primarily investing in markets that operate DVP (Delivery Versus Payment) settlement. The process of DVP mitigates the risk of losing the principal of a trade during the settlement process; and · J.P. Morgan Securities LLC is subject to regular monitoring by J.P. Morgan Europe Limited, the Company's Depositary, and the Board receives regular reports from J.P. Morgan Europe Limited. |
Service provider risk The Company is reliant on the systems of its service providers to run its business and as such disruption to, or a failure of, those systems could lead to a failure to comply with law and regulations leading to reputational damage and/ or financial loss. Given the reliance on connected systems by the Company's service provider cyber risks are considered to be heightened currently. | To manage these risks the Board: · receives a monthly compliance report from Frostrow, which includes, inter alia, details of compliance with applicable laws and regulations; · reviews internal control reports, key policies, including measures taken to combat cyber security issues, and also the disaster recovery procedures of its service providers; · maintains a risk matrix with details of risks the Company is exposed to, the controls relied on to manage those risks and the frequency of the controls operation; · receives updates on pending changes to the regulatory and legal environment and progress towards the Company's compliance with these; and · has considered the increased risk of cyber-attacks and received reports and assurance at meetings with its service providers where the information security controls in place were reviewed. |
Emerging risks
The Company has carried out a robust assessment of its emerging risks, and the procedures in place to identify and monitor them are described below. The International Risk Governance Council defines an 'emerging' risk as one that is new, or a known risk appearing in a new or unfamiliar context, or under new contextual conditions (i.e. re-emerging). Failure to identify emerging risks may result in reactive responses rather than proactive management and, in extreme cases, could render the Company unviable or force a fundamental change to its structure, objective, or strategy.
The Audit & Risk Committee reviews a risk schedule at its half-yearly meetings. Emerging risks are discussed during these sessions and are also considered on an ongoing basis to ensure that both new and evolving risks are identified and, where practicable, mitigated.
The Audit & Risk Committee continues to monitor and assess the following key emerging risks:
· Technological disruption in global healthcare markets, including the impact of artificial intelligence, precision medicine, and digital health platforms;
· Evolving ESG expectations and regulatory standards, particularly relating to climate disclosure, social impact, and governance frameworks;
· Cybersecurity threats affecting the Company's service providers and/or portfolio companies, particularly relating to the protection of sensitive medical or patient data;
· Long-term changes in global healthcare policy, public funding models, and innovation frameworks, especially in the U.S. and emerging markets; and
· Water scarcity is an emerging risk for healthcare companies reliant on water-intensive manufacturing and laboratory processes. Constraints on water availability may increase costs, disrupt production, and necessitate investment in efficiency or treatment infrastructure. These pressures could impact margins, supply chain resilience, and expose companies to reputational risks in water-stressed regions.
The Committee recognises that such risks can also present opportunities for companies that adapt early, and it remains alert to both the threats and potential strategic implications they may pose.
DISCOUNT/PREMIUM CONTROL
The Board undertakes a regular review of the level of discount/premium and consideration is given to ways in which share price performance may be enhanced, including the effectiveness of marketing, share issuance and share buybacks, where appropriate.
It is the Board's policy to buy back the Company's shares if the share price discount to the net asset value per share exceeds 6% on an ongoing basis. Shares repurchased are held as treasury shares. Treasury shares can be sold back to the market at a later date at a premium to the cum - income net asset value per share (See Glossary). Shareholders should note, however, that it remains very possible for the discount to be greater than 6% for extended periods of time particularly when sentiment towards the Company, the sector and to investment trusts generally remains poor.
While buybacks may prove unable to prevent the discount from widening, they also enhance the net asset value per share for remaining shareholders and go some way to dampening discount volatility which can adversely affect investors' risk adjusted returns.
At times when there are unsatisfied buying orders for the Company's shares in the market, the Company has the ability to issue new shares or to re-issue treasury shares at a small premium to the cum income net asset value per share. This acts as an effective share price premium management tool.
Details of share issuance and share buybacks are set out on page 49 of the Annual Report.
SOCIAL, HUMAN RIGHTS AND ENVIRONMENTAL MATTERS
The Directors, through the Company's Portfolio Manager, encourage companies in which investments are made to adhere to best practice with regard to corporate governance. In light of the nature of the Company's business there are no relevant human rights issues and the Company does not have a human rights policy.
The Company recognises that social and environmental issues can have an effect on some of its investee companies.
As an externally-managed investment trust, the Company does not have any employees or maintain any premises, nor does it undertake any manufacturing or other physical operations itself. All its operational functions are outsourced to third party service providers. Therefore, the Company has no material, direct impact on the environment or any particular community and the Company itself has no environmental, human rights, social or community policies. The Board of Directors consists of seven Directors, five of whom are resident in the UK, one in Canada and one in the U.S. The Board holds the majority of its regular meetings in the UK, with usually one meeting held each year in New York, and has a policy that travel, as far as possible, is minimal, thereby minimising the Company's greenhouse gas emissions. Further details concerning greenhouse gas emissions can be found within the Report of the Directors. Video conferencing continues to be a very effective way of holding meetings, and this medium continues to be used alongside in person meetings.
The Portfolio Manager engages with the Company's underlying investee companies in relation to their corporate governance practices and the development of their policies on social, community and environmental matters (see page 32 of the Annual Report for further information).
The Company is committed to carrying out business in an honest and fair manner with a zero-tolerance approach to bribery, tax evasion and corruption. As such, policies and procedures are in place to prevent this. In carrying out its activities, the Company aims to conduct itself responsibly, ethically and fairly. The Board expects that the Company's principal service providers have appropriate policies in place and carry out a regular review of their arrangements.
TASKFORCE FOR CLIMATE-RELATED FINANCIAL DISCLOSURES ("TCFD")
The Company notes the TCFD recommendations on climate-related financial disclosures. The Company is an investment trust with no employees, internal operations or property and, as such, it is exempt from the UK Listing Rules requirement to report against the TCFD framework.
GOING CONCERN
The financial statements have been prepared on a going concern basis. The Directors consider this is the appropriate basis as the Company has adequate resources to continue in operational existence for the foreseeable future, being taken as 12 months from the date of approval of this report on 4 June 2026. The Company's shareholders are asked every five years to vote for the continuation of the Company, this will next be put to shareholders at the Annual General Meeting to be held in 2029. The content of the Company's portfolio, trading activity, the Company's cash balances and revenue forecasts, and the trends and factors likely to affect the Company's performance are reviewed and discussed at each Board meeting. The Board has considered a detailed assessment of the Company's ability to meet its liabilities as they fall due, including stress and liquidity tests which modelled the effects of substantial falls in markets and significant reductions in market liquidity, on the Company's net asset value, its cash flows and its expenses. Further information is provided in the Audit & Risk Committee Report.
Based on the information available to the Directors at the date of this report, including the results of these stress tests, the conclusions drawn in the Viability Statement below, the Company's cash balances, and the liquidity of the Company's listed investments, the Directors are satisfied that the Company has adequate financial resources to continue in operation for at least the next 12 months and that, accordingly, it is appropriate to continue to adopt the going concern basis in preparing the financial statements.
VIABILITY STATEMENT
The Directors have assessed the Company's position and prospects, including consideration of the Company's principal risks, and have formed a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the next five financial years. The Board has chosen a five-year horizon in view of both the long-term outlook adopted by the Portfolio Manager when making investment decisions and also the investment horizon adopted by investors.
To make this assessment, the Audit & Risk Committee has considered the Company's financial position, its ability to liquidate the portfolio and to meet its liabilities as they fall due. The following points were noted:
· The portfolio is comprised principally of investments traded on major international stock exchanges. Based on recent market volumes c.72.5% of the current portfolio could be liquidated and the funds received within three trading days. There is no current expectation that the nature of the investments held within the portfolio will be significantly different in future.
· The Board has considered the viability of the Company under various scenarios, including periods of stock market and economic volatility, and concluded that it would expect to be able to ensure the financial stability of the Company due, in large part, to having a diversified portfolio comprising principally of listed and readily realisable assets. As illustrated in note 16 to the financial statements, the Board has considered the following risks with appropriate sensitivity analysis having been undertaken: market risk (including foreign currency risk, interest rate risk and other price risk), liquidity risk and credit risk.
With an ongoing charges ratio of 0.9%, the expenses of the Company are predictable and modest in comparison with the assets and there are no known capital commitments which would alter that position.
· The Company has an overdraft facility which can be used to meet its liabilities. Details of the Company's current liabilities as at 31 March 2026 are set out in notes 10 and 12 to the financial statements.
· The Company has no employees. Therefore, it does not have redundancy or other employment related liabilities or responsibilities.
The Audit & Risk Committee, in addition to considering the potential impact of the Company's principal risks and various plausible downside scenarios, has made the following assumptions in considering the Company's longer-term viability:
· There will continue to be demand for investment trusts;
· The Portfolio Manager will continue to adopt a long-term view when making investments;
· The Company invests principally in the securities of listed companies traded on international stock exchanges to which investors will wish to continue to have exposure;
· Shareholders will vote for the continuation of the Company at the Annual General Meeting to be held in 2029 and at five-year intervals thereafter;
· Due to the closed-ended nature of the Company, unlike open-ended funds, it does not have to sell investments when shareholders wish to sell their shares;
· The Company will continue to be able to fund share buybacks when required. The Company bought back 121,129,387 shares in the year under review at a total cost of £396.3 million. It had shareholders' funds in excess of £1,385.5 million at the year end; and
· The long-term performance of the Company will continue to be satisfactory.
STAKEHOLDER INTERESTS AND BOARD DECISION-MAKING (SECTION 172 OF THE COMPANIES ACT 2006)
The following disclosure which is required by the Companies Act 2006 and the AIC Code of Corporate Governance, describes how the Directors have had regard to the views of the Company's stakeholders in their decision-making.
Stakeholder group | How the board, the portfolio manager and the AIFM have engaged with the Company's stakeholders |
Investors | The Portfolio Manager and Frostrow, on behalf of the Board, complete a programme of investor relations throughout the year. An analysis of the Company's shareholder register is provided to the Directors at each Board meeting along with marketing reports from Frostrow. The Board reviews and considers the marketing plans on a regular basis. Reports from the Company's broker are submitted to the Board on investor sentiment and industry issues. Key mechanisms of engagement include: · The Annual General Meeting. · The Annual and Half-Year Reports. · The Company's website which hosts reports, articles and insights, monthly fact sheets and video interviews with the Portfolio Manager. · One-on-one and group investor meetings. · Online and in person seminars with presentations from the Portfolio Manager. |
Portfolio Manager | The Board met regularly with the Company's Portfolio Manager throughout the year. The Board also receives monthly performance and compliance reporting. The Portfolio Manager's attendance at each Board meeting provides the opportunity for the Portfolio Manager and Board to further reinforce their mutual understanding of what is expected from both parties. The Board encourages the Company's Portfolio Manager to engage with companies and in doing so expects ESG issues to be an important consideration. The Board receives an update on Frostrow's engagement activities by way of a dedicated report at Board meetings and at other times during the year as required. |
Other Service Providers | The Board and Frostrow, acting in its capacity as AIFM, engage regularly with other service providers both in one-to-one meetings and via regular written reporting. This regular interaction provides an environment where topics, issues and business development needs can be dealt with efficiently and collegiately. The Board together with Frostrow also carried out a review of the service providers' business continuity plans and additional cyber security provisions. The review of the performance of the Portfolio Manager and Frostrow is a continuous process carried out by the Board and the Management Engagement & Remuneration Committee with a formal evaluation being undertaken annually. |
What were the key areas of engagement? | What actions were taken, including main decisions? |
· Ongoing dialogue with shareholders concerning the strategy of the Company, performance and the portfolio. · Net asset value and share price performance. · Composition of the Board and Director tenure. · The operation of the Company's discount management policy. | · The Portfolio Manager and Frostrow meet regularly with shareholders and potential investors to discuss the Company's strategy, performance and portfolio. The Chair of the Board and his successor, William Hemmings, also met with key shareholders during the year to discuss corporate governance matters and also the Company's investment strategy. · Throughout the year the Board closely monitored the Company's discount/premium to NAV per share and received regular updates from the broker. 121,219,387 shares were bought back during the year, and a further 10,373,640 shares were bought back since the year end to 3 June 2026. No new shares were issued during the year, nor following the year end to 3 June 2026. (Please see the statement from the Chair for further information.) |
· Regular review of the performance and make-up of the investment portfolio. · The integration of ESG factors into the Portfolio Manager's investment processes. | · The Board engaged with the Portfolio Management team to discuss the Company's overall performance as well as developments in individual portfolio companies and wider macroeconomic developments. · The Portfolio Manager provides a periodic update on ESG issues to the Board. |
· The Directors have frequent engagement with the Company's other service providers through the annual cycle of reporting. This engagement is completed with the aim of maintaining an effective working relationship and oversight of the services provided. · The Board is cognisant that the trading of the Company's shares at a persistent and significant discount or premium to the prevailing NAV per share is not in the interests of shareholders. | · No specific action required as the reviews of the Company's service providers, have been positive and the Directors believe their continued appointment is in the best interests of the Company. Having nearly exhausted the authority granted at the 2025 AGM, the Board asked shareholders to renew the Company's authority to buy back shares in the market at a General Meeting held on 1 October 2025. Shareholders approved the proposal. Following the year-end, a further General Meeting was held on 2 June 2026 to further renew this authority. Shareholders again approved the proposal. |
PERFORMANCE AND FUTURE DEVELOPMENTS
A review of the Company's year, its performance and the outlook for the Company can be found in the Chair's Statement and in the Portfolio Manager's Review.
The Company's overall strategy remains unchanged.
ALTERNATIVE PERFORMANCE MEASURES
The Financial Statements set out the required statutory reporting measures of the Company's financial performance. In addition, the Board assesses the Company's performance against a range of criteria which are viewed as particularly relevant for investment trusts, which are explained in greater detail in the Strategic Report, under the heading 'Key Performance Indicators' on page 35 of the Annual Report. By order of the Board
Frostrow Capital LLP
Company Secretary
4 June 2026
REPORT OF THE DIRECTORS
The Directors present their Annual Report on the affairs of the Company together with the audited financial statements and the Independent Auditors' Report for the year ended 31 March 2026.
SIGNIFICANT AGREEMENTS
Details of the services provided under these agreements are included in the Strategic Report.
Alternative investment fund management agreement
Frostrow is the designated AIFM for the Company on the terms and subject to the conditions of the alternative investment fund management agreement between the Company and Frostrow (the "AIFM Agreement").
The notice period on the AIFM Agreement with Frostrow is 12 months, termination can be initiated by either party.
Details of the fee payable to Frostrow can be found on page 36 of the Annual Report.
Portfolio management agreement
Under the AIFM Agreement Frostrow has delegated the portfolio management function to OrbiMed, under a portfolio management agreement between it, the Company and Frostrow (the "Portfolio Management Agreement").
OrbiMed receives a periodic fee equal to 0.65% p.a. of the Company's NAV and a performance fee as set out in the Performance Fee section below. Its agreement with the Company may be terminated by either party giving notice of not less than 12 months.
Performance fee
Dependent on the level of long-term outperformance of the Company, OrbiMed is entitled to a performance fee. The performance fee is calculated by reference to the amount by which the Company's NAV performance has outperformed the Benchmark (see inside front cover for details of the Benchmark).
The fee is calculated quarterly by comparing the cumulative performance of the Company's NAV with the cumulative performance of the Benchmark since the launch of the Company in 1995. The performance fee amounts to 15.0% of any outperformance over the Benchmark. Provision is made within the daily NAV per share calculation as required and in accordance with generally accepted accounting standards.
In order to ensure that only sustained outperformance is rewarded, at each quarterly calculation date any performance fee payable is based on the lower of:
(i) The cumulative outperformance of the portfolio over the Benchmark as at the quarter end date; and
(ii) The cumulative outperformance of the portfolio over the Benchmark as at the corresponding quarter end date in the previous year less any cumulative outperformance on which a performance fee has already been paid.
The effect of this is that outperformance has to be maintained for a twelve month period before it is paid.
As at 31 March 2026 no performance fees were accrued or payable (31 March 2025: £nil). Since the last performance fee was paid in 2021, the Company has underperformed its Benchmark and as such no performance fee has been provided for in the current or comparative year.
Depositary agreement
The Company appointed J.P. Morgan Europe Limited (the "Depositary") as its Depositary in accordance with the AIFMD on the terms and subject to the conditions of the Depositary agreement between the Company, Frostrow and the Depositary (the "Depositary Agreement").
Under the terms of the Depositary Agreement the Company has agreed to pay the Depositary a fee calculated at 1.75bp on net assets up to £150 million, 1.50 bps on net assets between £150 million and £300 million, 1.00bps on net assets between £300 million and £500 million and 0.50bps on net assets above £500 million.
The Depositary has delegated the custody and safekeeping of the Company's assets to J.P. Morgan Securities LLC (the "Custodian and Prime Broker") pursuant to a delegation agreement between the Company, Frostrow, the Depositary and the Custodian and Prime Broker (the "Delegation Agreement").
The Delegation Agreement transfers the Depositary's liability for the loss of the Company's financial instruments held in custody by the Custodian and Prime Broker to the Custodian and Prime Broker as permitted by the AIFMD. The Company has consented to the transfer and reuse of its assets by the Custodian and Prime Broker (known as "rehypothecation") in accordance with the terms of an institutional account agreement between the Company, the Custodian and Prime Broker and certain other J.P. Morgan entities (as defined therein).
Prime brokerage agreement
The Company appointed J.P. Morgan Securities LLC on the terms and subject to the conditions of the prime brokerage agreement between the Company, Frostrow and the Depositary (the "Prime Brokerage Agreement").
The Custodian and Prime Broker receives interest on the drawn overdraft.
The Custodian and Prime Broker is a registered broker - dealer and is regulated by the United States Securities and Exchange Commission.
RESULTS AND DIVIDENDS
The results attributable to shareholders for the year and the transfer to reserves are shown on pages 76 and 77 of the Annual Report. Details of the Company's dividend record can be found on page 5 of the Annual Report.
Substantial interests in share capital
As at 31 March 2026, the Company had been notified of the following substantial interest in the Company's voting rights.
Number of | % held | |
Rathbones Investment Management Limited | 67,482,629 | 15.1 |
This table reflects those shareholders who have notified the Company of a substantial interest in its shares when they have crossed certain thresholds and may not reflect their current holding. The table does not reflect the full range of investors in the Company. The shareholder register is principally comprised of private wealth managers and retail investors owning their shares through a variety of online platforms. A profile of the Company's ownership is shown on page 96 of the Annual Report.
SHARE CAPITAL
At 31 March 2026, there were 373,412,417 ordinary shares of 25p each ("shares") in issue (excluding 228,252,783 shares held in treasury) (2025: 494,631,804 shares in issue (excluding 107,033,396 shares held in treasury)). All shares rank equally for dividends and distributions. Each shareholder is entitled to one vote on a show of hands and, on a poll, to one vote for every share held.
At the start of the year under review, the Directors had shareholder authority to issue up to 49,463,180 shares on a non-pre-emptive basis and, having utilised a proportion of the authority granted at the 2024 AGM, to buy back up to 45,203,448 shares in the market. At the Company's AGM held on 9 July 2025, these authorities expired and new authorities to allot up to 46,432,453 shares (representing 10% of the Company's issued share capital at the time) on a non-pre-emptive basis and to buy back up to 69,602,221 shares (representing 14.99% of the Company's issued share capital at the time) were granted. After utilising the majority of the buyback authority granted at the AGM, a renewed authority to buy back up to 61,086,622 shares was granted at a general meeting held on 1 October 2025. No new shares were issued during the year. In total, 121,219,387 shares were repurchased during the year to be held as treasury shares. Following the year-end, a further renewed authority to buy back up to 54,510,546 shares was granted at a general meeting held on 2 June 2026. Further information on the Company's share issuance and buyback policies can be found on pages 41 and 42 of the Annual Report.
The giving of powers to issue or buy back the Company's shares requires the relevant resolution to be passed by shareholders. Proposals for the renewal of the Board's authorities to issue and buy back shares are detailed in the Notice of AGM.
There are no restrictions concerning the transfer of securities in the Company; no special rights with regard to control attached to the securities; no restrictions on voting rights; no agreements between holders of securities regarding their transfer known to the Company; and no agreements which the Company is party to that might affect its control following a successful takeover bid.
DIRECTORS' & OFFICERS' LIABILITY INSURANCE COVER
Directors' & officers' liability insurance cover was maintained by the Company during the year ended 31 March 2026 and to the date of this report. It is intended that this policy will continue for the year ending 31 March 2027 and subsequent years.
DIRECTORS' INDEMNITIES
During the year under review and to the date of this report, indemnities were in force between the Company and each of its Directors under which the Company has agreed to indemnify each Director, to the extent permitted by law, in respect of certain liabilities incurred as a result of carrying out his or her role as a Director of the Company. The Directors are also indemnified against the costs of defending any criminal or civil proceedings or any claim by the Company or a regulator as they are incurred provided that where the defence is unsuccessful the Director must repay those defence costs to the Company. The indemnities are qualifying third party indemnity provisions for the purposes of the Companies Act 2006.
A copy of each deed of indemnity is available for inspection at the Company's registered office during normal business hours and will be available for inspection at the Annual General Meeting. Please refer to the Statement from the Chair for details of this year's AGM arrangements.
POLITICAL AND CHARITABLE DONATIONS
The Company has not in the past and does not intend in the future to make political or charitable donations.
MODERN SLAVERY ACT 2015
The Company does not provide goods or services in the normal course of business, and as a financial investment vehicle does not have customers. The Directors do not therefore consider that the Company is required to make a statement under the Modern Slavery Act 2015 in relation to slavery or human trafficking.
ANTI-BRIBERY AND CORRUPTION POLICY
The Board has adopted a zero tolerance approach to instances of bribery and corruption. Accordingly, it expressly prohibits any Director or associated persons when acting on behalf of the Company, from accepting, soliciting, paying, offering or promising to pay or authorise any payment, public or private in the UK or abroad to secure any improper benefit for themselves or for the Company.
The Board ensures that its service providers apply the same standards in their activities for the Company.
A copy of the Company's Anti Bribery and Corruption Policy can be found on its website at www.worldwidewh.com. The policy is reviewed regularly by the Audit & Risk Committee.
CRIMINAL FINANCES ACT 2017
The Company has a commitment to zero tolerance towards the criminal facilitation of tax evasion.
A copy of the Company's Prevention of the Facilitation of Tax Evasion Policy can be found on its website at www.worldwidewh.com. The policy is reviewed regularly by the Audit & Risk Committee.
GLOBAL GREENHOUSE GAS EMISSIONS
The Company has no 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 Reports and Directors' Reports) Regulations 2013 or the Companies (Directors' Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, including those within the Company's underlying investment portfolio. Consequently, the Company consumed less than 40,000 kWh of energy during the year in respect of which the Report of the Directors is prepared and therefore is exempt from the disclosures required under the Streamlined Energy and Carbon Reporting criteria.
COMMON REPORTING STANDARD ("CRS")
CRS is a global standard for the automatic exchange of information commissioned by the Organisation for Economic Cooperation and Development and incorporated into UK law by the International Tax Compliance Regulations 2015. CRS requires the Company to provide certain additional details to HMRC in relation to certain shareholders. The reporting obligation began in 2016 and is an annual requirement. The Registrars, MUFG Corporate Markets, have been engaged to collate such information and file the reports with HMRC on behalf of the Company.
RTICLES OF ASSOCIATION
Amendments of the Company's Articles of Association require a special resolution to be passed by shareholders.
The Company is proposing to adopt new articles of association at the AGM in July. The change proposed will provide a mechanism to ensure continuity of governance in the unlikely event that the number of directors falls below the minimum required.
REQUIREMENTS OF THE UK LISTING RULES
The UK Listing Rules require the Company to include certain information in a single identifiable section of the Annual Report or a cross reference table indicating where the information is set out. The Directors confirm that there are no disclosures to be made under the UK Listing Rules.
UK SANCTIONS
The Board has made due diligence enquiries of the service providers that process the Company's shareholder data, to ensure the Company's compliance with the UK sanctions regime. The relevant service providers have confirmed that they check the Company's shareholder data against the UK sanctions list on a daily basis. At the date of this report, no sanctioned individuals had been identified on the Company's shareholder register. The Board notes that stockbrokers and execution-only platforms also carry out their own due diligence.
By order of the Board
Frostrow Capital LLP
Company Secretary
4 June 2026
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law and regulations. In preparing these financial statements, the Directors are required to:
· select suitable accounting policies and apply them consistently;
· make judgements and estimates that are reasonable and prudent;
· follow applicable UK accounting standards comprising FRS 102;
· prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business; and
· prepare a director's report, a strategic report and a 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's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006. 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 Report of the Directors and other information included in the Annual Report is prepared in accordance with company law in the United Kingdom. They are also responsible for ensuring that the Annual Report includes information required by the UK Listing Rules.
The Directors are also responsible for ensuring that the Annual Report and the Financial Statements are made available on a website. The Annual Report and the Financial Statements are published on the Company's website at www.worldwidewh.com and via Frostrow's website at www.frostrow.com. The maintenance and integrity of these websites, so far as it relates to the Company, is the responsibility of Frostrow. The work carried out by the Auditors does not involve consideration of the maintenance and integrity of these websites and, accordingly, the Auditors accept no responsibility for any changes that have occurred to the financial statements since they were initially presented on these websites. Visitors to the websites need to be aware that legislation in the United Kingdom governing the preparation and dissemination of the financial statements may differ from legislation in their jurisdiction.
DISCLOSURE OF INFORMATION TO THE AUDITORS
So far as the Directors are aware, there is no relevant information of which the Auditors are unaware. The Directors have taken all steps they ought to have taken to make themselves aware of any relevant audit information and to establish that the Auditors are aware of such information.
RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE ANNUAL FINANCIAL REPORT
The Directors confirm to the best of their knowledge that:
· the Annual Report and the Financial Statements have been prepared in accordance with applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and the return for the year ended 31 March 2026; and
· the Annual Report and the Financial Statements, includes a fair review of the development and performance of the Company and of its financial position, together with a description of the principal risks and uncertainties it faces. Also, that taken as a whole they are fair, balanced and understandable and provide the information necessary to assess the Company's performance, business model and strategy.
On behalf of the Board
Doug McCutcheon
Chair
4 June 2026
CORPORATE GOVERNANCE
THE BOARD AND COMMITTEES
Responsibility for effective governance lies with the Board. The governance framework of the Company reflects the fact that as an investment company it has no employees and outsources portfolio management to OrbiMed and risk management, company management, company secretarial, administrative and marketing services to Frostrow.
THE BOARD
Chair - Doug McCutcheon
Senior Independent Director - Dr. Bina Rawal
Five additional non-executive Directors, all considered independent, except for Sven Borho.
Key responsibilities:
• to provide leadership and set strategy, values and standards within a framework of prudent effective controls which enable risk to be assessed and managed;
• to ensure that a robust corporate governance framework is implemented; and
• to challenge constructively and scrutinise performance of all outsourced activities.
Management Engagement & Chair Jo Parfrey All Independent Directors Key responsibilities:
| Audit & Risk Committee Chair Tim Livett* All Independent Directors (excluding the Chair of the Company Doug McCutcheon) Key responsibilities:
|
| Nominations Committee Chair Dr. Bina Rawal All Independent Directors Key responsibilities:
|
* The Board believes that Tim Livett has the necessary recent and relevant financial experience to Chair the Company's Audit & Risk Committee.
Copies of the full terms of reference, which clearly define the responsibilities of each Committee, can be obtained from the Company Secretary and can be found at the Company's website at www.worldwidewh.com. Copies will also be available for inspection on the day of the AGM.
CORPORATE GOVERNANCE STATEMENT
The Board is committed to maintaining and demonstrating high standards of corporate governance. The Board has considered the principles and recommendations of the AIC Code of Corporate Governance published in February 2024 (the "AIC Code"). The AIC Code addresses all the principles set out in the UK Corporate Governance Code (the "UK Code"), as well as setting out additional provisions on issues that are of specific relevance to the Company.
The Board notes that Provision 29 of the UK Code and Provision 34 of the AIC Code, which deal with Board monitoring of internal controls, are effective for accounting periods beginning on or after 1 January 2026. The Board continues to review and enhance the Company's risk management and internal control framework in preparation for compliance with this enhanced reporting requirement.
The Board considers that reporting in accordance with the principles and recommendations of the AIC Code (which has been endorsed by the Financial Reporting Council) provides more relevant and comprehensive information to shareholders. By reporting against the AIC Code, the Company meets its obligations under the UK Code (and associated disclosure requirements under paragraph 6.6.6 of the UK Listing Rules) and as such does not need to report further on issues contained in the UK Code which are irrelevant to the Company as an externally managed investment company, including the provisions relating to the role of the chief executive, executive directors' remuneration and the internal audit function.
The Company has complied with the principles and recommendations of the AIC Code.
The AIC Code can be viewed at www.theaic.co.uk and the UK Code can be viewed on the Financial Reporting Council website at www.frc.org.uk. The Corporate Governance Report forms part of the Report of the Directors.
BOARD LEADERSHIP AND PURPOSE
Purpose and strategy
The purpose and strategy of the Company are described in the Strategic Report.
THE BOARD
The Board is responsible for the effective Stewardship of the Company's affairs. Strategy issues and all operational matters of a material nature are considered at its meetings.
The Board consists of seven non-executive Directors, each of whom, with the exception of Sven Borho, is independent of OrbiMed and the Company's other service providers. No member of the Board is a Director of another investment company managed by OrbiMed, nor has any Board member (with the exception of Sven Borho) been an employee of OrbiMed or any of the Company's service providers. Further details regarding the Directors can be found on pages 46 to 47 of the Annual Report.
The Board carefully considers the various guidelines for determining the independence of non-executive Directors, placing particular weight on the view that independence is evidenced by an individual being independent of mind, character and judgement. All Directors retire at the AGM each year and, if appropriate, seek election or re - election. Each Director has signed a letter of appointment to formalise the terms of their engagement as a non - executive Director, copies of which are available on request at Frostrow's offices.
BOARD CULTURE
The Board aims to consider and discuss differences of opinion, unique vantage points and to exploit fully areas of expertise. The Chair encourages open debate to foster a supportive and co-operative approach for all participants. Strategic decisions are discussed openly and constructively. The Board aims to be open and transparent with shareholders and other stakeholders and for the Company to conduct itself responsibly, ethically and fairly in its relationships with service providers.
The Board has gained assurance on whistleblowing procedures at the Company's principal service providers to ensure employees at those companies are supported in speaking up and raising concerns. No concerns relating to the Company were raised during the year.
SHAREHOLDER RELATIONS
The Company has appointed Frostrow to provide marketing and investor relations services, in the belief that a well - marketed investment company is more likely to grow over time, have a more diverse, stable list of shareholders and its shares will trade at close to net asset value per share over the long run. Frostrow actively promotes the Company as set out on page 34 and 35 of the Annual Report.
SHAREHOLDER COMMUNICATIONS
The Board, the AIFM and the Portfolio Manager consider maintaining good communications with shareholders and engaging with larger shareholders through meetings and presentations a key priority. Shareholders are kept informed by the publication of annual and half-year reports which include financial statements. These reports are supplemented by the daily release of the net asset value per share to the London Stock Exchange and the publication of monthly fact sheets. All this information, including interviews with the Portfolio Manager, is available on the Company's website at www.worldwidewh.com.
The Board monitors the share register of the Company; it also reviews correspondence from shareholders at each meeting and maintains regular contact with major shareholders. Shareholders who wish to raise matters with a Director may do so by writing to them at the registered office of the Company.
The Board supports the principle that the AGM be used to communicate with private investors, in particular. Shareholders are encouraged to attend the AGM, where they are given the opportunity to question the Chair, the Board and representatives of the Portfolio Manager. In addition, the Portfolio Manager makes a presentation to shareholders covering the investment performance and strategy of the Company at the AGM. Voting at the AGM is conducted on a poll and details of the proxy votes received in respect of each resolution will be made available on the Company's website.
SIGNIFICANT HOLDINGS AND VOTING RIGHTS
Details of the shareholders with substantial interests in the Company's shares, the Directors' authorities to issue and repurchase the Company's shares, and the voting rights of the shares are set out in the Directors' Report.
BOARD MEETINGS
The Board meets formally at least four times each year. A representative of OrbiMed attends all meetings; representatives from Frostrow are also in attendance at each Board meeting. The Independent Directors also meet before each formal Board meeting without representatives from Frostrow and OrbiMed being present. The Chair encourages open debate to foster a supportive and co - operative approach for all participants.
The Board has agreed a schedule of matters specifically reserved for decision by the Board. This includes establishing the investment objectives, strategy and the Benchmark, the permitted types or categories of investments, the markets in which transactions may be undertaken, the amount or proportion of the assets that may be invested in any geography or category of investment or in any one investment, and the Company's share issuance and share buyback policies.
The Board, at its regular meetings, undertakes reviews of key investment and financial data, revenue projections and expenses, analyses of asset allocation, transactions and performance comparisons, share price and net asset value performance, marketing and shareholder communication strategies, the risks associated with pursuing the investment strategy, peer group information and industry issues.
The Chair is responsible for ensuring that the Board receives accurate, timely and clear information. Representatives of OrbiMed and Frostrow Capital LLP report regularly to the Board on issues affecting the Company.
The Board is responsible for strategy and has established an annual programme of agenda items under which it reviews the objectives and strategy for the Company at each meeting.
CONFLICTS OF INTEREST
Company Directors have a statutory obligation to avoid a situation in which they (and connected persons) have, or can have, a direct or indirect interest that conflicts, or may possibly conflict, with the interests of the Company. The Board has in place procedures for managing any actual or potential conflicts of interest. No conflicts of interest arose during the year under review.
BOARD FOCUS AND RESPONSIBILITIES
With the day to day management of the Company outsourced to service providers the Board's primary focus at each Board meeting is reviewing the investment performance and associated matters, such as, inter alia, future outlook and strategy, gearing, asset allocation, investor relations, marketing, and industry issues.
In line with its primary focus, the Board retains responsibility for all the key elements of the Company's strategy and business model, including:
- the Investment Objective, Policy and Benchmark, incorporating the investment and derivative guidelines and limits, and changes to these;
- the maximum level of gearing and leverage the Company may employ;
- a review of performance against the Company's KPIs;
- a review of the performance and continuing appointment of service providers; and
- the maintenance of an effective system of oversight, risk management and corporate governance.
The Investment Objective, Policy, and Benchmark, including the related limits and guidelines, are set out on pages 10 and 11 of the Annual Report, along with details of the gearing and leverage levels allowed.
Details of the principal KPIs and further information on the principal service providers, their performance and continuing appointment, along with details of the principal risks, and how they are managed, are set out in the Strategic Report.
The Corporate Governance Report, on pages 52 to 66 of the Annual Report, includes a statement of compliance with corporate governance codes and best practice, and the Business Review (pages 34 to 45 of the Annual Report) framework within which the Board operates.
BOARD COMPOSITION AND SUCCESSION
Succession planning
During the year, the Nominations Committee met to consider who should succeed Doug McCutcheon as Chair of the Company ahead of his planned retirement in July 2026.
The Board has an approved succession planning policy to ensure that: (i) there is a formal, rigorous and transparent procedure for the appointment of new Directors; and (ii) the Board is comprised of members who collectively display the necessary balance of professional skills, experience, length of service and industry/Company knowledge.
Policy on the tenure of the Board Chair and other Directors
All Directors seek re-election every year. The Board considers that a Director's tenure does not necessarily reduce his or her ability to act independently and assesses each Director's independence annually through a formal performance evaluation.
The Board asked Doug McCutcheon to extend his tenure on the Board and take on the role of Board Chair from July 2022 in order to oversee the renewal of the Board, including the retirement and replacement of all but one of the then Directors as well as changing the composition and leadership of all of the Board's Committees.
With the process of Board renewal now complete, going forward, it is the Board's intention to limit the tenure of all Directors and, accordingly, the intention is that no Director will stand for re-election at the AGM following the ninth anniversary of their appointment to the Board. Doug McCutcheon will be retiring from the Board at the conclusion of this year's Annual General Meeting.
Portfolio Manager Representative on the Board
The Company was founded in 1995 with OrbiMed as the Portfolio Manager. Since that time, the Company has performed strongly, producing a compound net asset value per share annual return of +13.3%, well above our Benchmark and making us the third best performing trust in the UK across all sectors over the period (Source: Winterflood Investment Trusts).
Since our inception, a representative of OrbiMed has served as a non-independent Director of the Company, which is less common in the investment trust sector today than when the Company was founded.
The current OrbiMed representative on the Board, Sven Borho, has been a Director for eight years. He does not sit on any of the Board's Committees and he does not receive a salary for serving as a Director.
Appointments to the Board
The Nominations Committee considers annually the skills possessed by the Board and identifies any skill shortages to be filled by new Directors.
The rules governing the appointment and replacement of Directors are set out in the Company's articles of association and the aforementioned succession planning policy. Where the Board appoints a new Director during the year, that Director will stand for election by shareholders at the next AGM. Subject to there being no conflict of interest, all Directors are entitled to vote on candidates for the appointment of new Directors and on the recommendation for shareholders' approval for the Directors seeking re-election at the AGM. When considering new appointments, the Board endeavours to ensure that he or she has the capabilities required to be effective and oversee the Company's strategic priorities. This will include an appropriate range, balance and diversity of skills, experience and knowledge. The Company is committed to ensuring that any vacancies arising are filled by the most qualified candidates.
Diversity policy
The Board supports the principle of Boardroom diversity, of which gender and ethnicity are two important aspects. The Company's policy is that the Board and its committees should be comprised of directors with a diverse range of skills, knowledge and experience and that appointments should be made on merit against objective criteria, including diversity in its broadest sense.
The objective of the policy is to have a broad range of approaches, backgrounds, skills, knowledge and experience represented on the Board. To this end, achieving a diversity of perspectives and backgrounds on the Board will be a key consideration in any director search process. The Board encourages any recruitment agencies it engages to find a diverse range of candidates that meet the criteria agreed for each appointment and, from the shortlist, aims to ensure that a diverse range of candidates is brought forward for interview.
The Board will continue to give due regard to the new diversity targets in the UK Listing Rules set out below. The Board will not discriminate unfairly on the grounds of gender, ethnicity, age, sexual orientation, disability or socio-economic background when considering the appointment of a new Director. Candidates' educational and professional backgrounds, their cognitive and personal strengths, are considered against the specification prepared for each appointment.
The UK Listing Rules require companies to report against the following diversity targets:
a) At least 40% of individuals on the board are women;
b) At least one of the senior board positions (Chair, CEO, CFO or SID) is held by a woman; and
c) At least one individual on the board is from a minority ethnic background.
As an externally managed investment company, the Company does not have the positions of CEO or CFO and therefore, as permitted by the UK Listing Rules, it has not reported formally against the second target as it is not applicable. As shown in the tables below, the Company has met both the first and the third targets. The Board will have due regard to these targets in future Director recruitment processes.
In accordance with the UK Listing Rules, the Board has provided the following information in relation to its diversity as at the year end.
Number of | |||
Number of | senior | ||
Board | Percentage | positions | |
Members | of the Board | on the Board* | |
Men | 4 | 57% | n/a |
Women | 3 | 43% | n/a |
Not specified/prefer not to say | - | - | n/a |
| |||
Number of | |||
Number of | senior | ||
Board | Percentage | positions | |
Members | of the Board | on the Board* | |
White British or other White (including minority-white groups) | 6 | 86% | n/a |
Mixed/Multiple Ethnic Groups | - | - | n/a |
Asian/Asian British | 1 | 14% | n/a |
Black/African/Caribbean/Black British | - | - | n/a |
Other ethnic group, including Arab | - | - | n/a |
Not specified/ prefer not to say | - | - | n/a |
* This column is does not apply to the Company as it is externally managed and does not have executive management functions, specifically it does not have a CEO or CFO. The Chair of the Board is a man and the SID is woman. Also, the Company considers that the chairs of the permanent sub-committees of the Board are senior roles in an investment company context. Of the three permanent sub-committees of the Board, two are chaired by a woman: the Nominations Committee and the Management Engagement & Remuneration Committee.
The information above was obtained by asking the Directors to indicate on an anonymous form, how they should be categorised for the purposes of the UK Listing Rules disclosures.
MEETING ATTENDANCE
The number of meetings held during the year of the Board and its Committees, and each Director's attendance level, is shown below:
Management | ||||
Engagement & | ||||
Audit & Risk | Nominations | Remuneration | ||
Board | Committee | Committee | Committee | |
Type and number of meetings held in 2025/26 | (8) | (2) | (2) | (2) |
Doug McCutcheon~ | 8 | - | 2 | 2 |
Dr Bina Rawal | 8 | 2 | 2 | 2 |
Tim Livett | 7 | 2 | 2 | 1 |
Sven Borho^ | 7 | - | - | - |
Sian Hansen | 8 | 2 | 2 | 2 |
William Hemmings | 8 | 2 | 2 | 2 |
Jo Parfrey | 8 | 2 | 2 | 2 |
~ Not a member of the Audit & Risk Committee.
^ Sven Borho does not sit on any of the Company's Committees.
All of the serving Directors attended the Annual General Meeting held on 9 July 2025.
BOARD EVALUATION
Following last year's external Board evaluation, an internal review of the Board its committees and individual Directors (including each Director's independence) was carried out in the form of performance evaluation questionnaires.
The review concluded that the Board works in a collegiate, efficient and effective manner, and there were no material weaknesses or concerns identified. The Board is satisfied that the structure, mix of skills and operation of the Board, its committees, and individual Directors continue to be effective.
The Board pays close attention to the capacity of individual Directors to carry out their work on behalf of the Company. In recommending individual Directors to shareholders for re-election, it considered their other Board positions and their time commitments and is satisfied that each Director has the capacity to be fully engaged with the Company's business. The Board has considered the position of all of the Directors seeking re-election as part of the evaluation process, and believes that it would be in the Company's best interests to propose them for re-election for the following reasons:
Sven Borho joined the Board in June 2018. Sven is a founder and Managing Partner of OrbiMed and heads their public Equity team and is the portfolio manager for OrbiMed's public equity and hedge funds. Sven does not receive a fee for being a Director, neither is he a member of any of the Company's Committees.
Tim Livett joined the Board in September 2022. A qualified accountant, Tim is Chair of the Audit & Risk Committee. Tim was formerly the Chief Financial Officer at Caledonia Investments PLC. Prior to this role he was Chief Financial Officer at Wellcome Trust, the global charitable foundation focused on health research and at Virgin Atlantic Limited. Tim is a non-executive Director of British Standards Institution and of Oxford University Endowment Management, plus a Trustee of Babraham Institute; he chairs the respective Audit and Risk Committees of these institutions. Tim is also a Director and Trustee of the Shell Foundation. He has an extensive and broad financial background.
Jo Parfrey joined the Board in September 2022. Jo is Chair of the Management Engagement & Remuneration Committee. She is the non-executive Chair of Octopus AIM VCT. She is also the non-executive Chair of Babraham Research Campus Limited. A Chartered Accountant, Jo has extensive experience of both global investment trusts and healthcare, including life sciences.
Dr Bina Rawal joined the Board in November 2019. A physician with 25 years' experience in life sciences research and development, she has held senior executive roles in drug development and scientific evaluation in four global pharmaceutical companies. She has also worked in senior roles with two medical research funding organisations. She is also a non-executive Director of PHP Plc.
Sian Hansen joined the Board in October 2024 and was previously Chief Operating Officer of C|T Group, Executive Director of the Legatum Institute and before that, Managing Director of the UK think tank Policy Exchange. Earlier in her career, Sian was a senior equity analyst and Co-Director of Sales for Asian Emerging Markets at Société Générale. Sian enhances the Board's knowledge of sustainability, enabling meaningful debates with the Portfolio Manager to take place. As a thought leader in political and other forums, she brings a valuable perspective on geo-political matters. She is a non-executive Director of The Lindsell Train Investment Trust plc.
William Hemmings joined the Board in October 2024 and has extensive experience in the investment trust sector from his previous roles as Head of Closed End Funds and Head of Investment Companies at Aberdeen Group (formerly Aberdeen Asset Management PLC). He was also formerly a Non - Executive Director on the board of Primary Health Properties Plc and a Director of the Association of Investment Trust Companies. He is consultant to board performance and external evaluation specialist Cyclico.
The Chair is pleased to report that following a formal performance evaluation, the Directors' performance continues to be effective and they continue to demonstrate commitment to the role.
TRAINING AND ADVICE
New appointees to the Board are provided with a full induction programme. The programme covers the Company's investment strategy, policies and practices. The Directors are also given key information on the Company's regulatory and statutory requirements as they arise including information on the role of the Board, matters reserved for its decision, the terms of reference of the Board Committees, the Company's corporate governance practices and procedures and the latest financial information. It is the Chair's responsibility to ensure that the Directors have sufficient knowledge to fulfil their role and Directors are encouraged to participate in training courses where appropriate.
The Directors have access to the advice and services of a Company Secretary through its appointed representative which is responsible to the Board for ensuring that Board procedures are followed and that applicable rules and regulations are complied with. The Company Secretary is also responsible for ensuring good information flows between all parties.
There is an agreed procedure for Directors, in the furtherance of their duties, to take independent professional advice if necessary at the Company's expense.
REVIEW OF TERMS OF ENGAGEMENT AND PERFORMANCE
The Management Engagement & Remuneration Committee conducted a formal review of the performance of the AIFM, the Portfolio Manager and the Company's principal service providers, incorporating an assessment of their respective fee arrangements. Following this review, the Committee concluded that the performance of each provider remained satisfactory and that the fees charged were reasonable and appropriate in the context of the services delivered.
As part of its review of service provider arrangements, the Committee undertook a comprehensive review of the Company's broking arrangements. Following a formal competitive tender process, Winterflood Securities was reappointed as broker to the Company.
RISK MANAGEMENT AND INTERNAL CONTROLS
The Board has overall responsibility for the Company's risk management and internal control systems and for reviewing their effectiveness. The Company applies the guidance published by the Financial Reporting Council on internal controls. Internal control systems are designed to manage, rather than eliminate, the risk of failure to achieve the business objective and can provide only reasonable and not absolute assurance against material misstatement or loss. These controls aim to ensure that the assets of the Company are safeguarded, that proper accounting records are maintained and that the Company's financial information is reliable. The Directors have a robust process for identifying, evaluating and managing the significant risks faced by the Company, which are recorded in a risk matrix. The Audit & Risk Committee, on behalf of the Board, considers each risk as well as reviewing the mitigating controls in place. Each risk is rated for its "likelihood" and "impact" and the resultant numerical rating determines its ranking into 'Principal/Key', 'Significant' or 'Minor'. This process was in operation during the year and continues in place up to the date of this report. The process also involves the Audit & Risk Committee receiving and examining regular reports from the Company's principal service providers. The Board then receives a detailed report from the Audit & Risk Committee on its findings. The Directors have not identified any significant failures or weaknesses in respect of the Company's internal control systems.
BENEFICIAL OWNERS OF SHARES - INFORMATION RIGHTS
Beneficial owners of shares who have been nominated by the registered holder of those shares to receive information rights under section 146 of the Companies Act 2006 are required to direct all communications to the registered holder of their shares rather than to the Company's registrar, MUFG Corporate Markets, or to the Company directly.
The Company has adopted a nominee share code.
The annual and half-year financial reports, and a monthly fact sheet are available to all shareholders. The Board, with the advice of Frostrow, reviews the format of the annual and half-year financial reports so as to ensure they are useful to all shareholders and others taking an interest in the Company. In accordance with best practice, the Annual Report, including the Notice of the AGM, is sent to shareholders at least 20 working days before the meeting. Separate resolutions are proposed for substantive issues.
ANNUAL GENERAL MEETING
The following information to be considered at the forthcoming annual general meeting 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). If you have sold or transferred all of your ordinary shares in the Company, you should pass this document, together with any other accompanying documents, including the form of proxy, at once to the purchaser or transferee, or to the stock broker, bank or other agent through whom the sale or transfer was effected, for onward transmission to the purchaser or transferee
The Company's Annual General Meeting will be held at Barber-Surgeons' Hall, Monkwell Square, Wood Street, Barbican, London EC2Y 5BL on Tuesday, 14 July 2026 from 12.30 p.m. Please refer to the Chair's Statement for details of this year's arrangements.
In particular, resolutions relating to the following items will be proposed at the forthcoming Annual General Meeting.
Resolution 13 Authority to allot shares
Resolution 14 Authority to disapply pre-emption rights
Resolution 15 Authority to sell shares held in treasury on a non pre-emptive basis
Resolution 16 Authority to buy-back shares Resolution 17 To adopt new articles of association
Resolution 18 Authority to hold General Meetings (other than the Annual General Meeting) on at least 14 clear days' notice
Resolution 13 will be proposed as an Ordinary Resolution and resolutions 14 to 18 will be proposed as Special Resolutions.
The full text of the resolutions can be found in the Notice of Annual General Meeting. Explanatory notes regarding the resolutions can be found on pages 106 to 108 of the Annual Report.
EXERCISE OF VOTING POWERS
The Board and the AIFM have delegated authority to OrbiMed to vote the shares owned by the Company. The Board has instructed that OrbiMed submit votes for such shares wherever possible. This accords with current best practice whilst maintaining a primary focus on financial returns. OrbiMed may refer to the Board on any matters of a contentious nature. The Board has reviewed OrbiMed's Voting Guidelines and is satisfied with their approach.
The Company does not retain voting rights on any shares that are held as collateral in connection with the overdraft facility provided by J.P. Morgan Securities LLC.
NOMINEE SHARE CODE
Where shares are held in a nominee company name, the Company undertakes:
- to provide the nominee company with multiple copies of shareholder communications, so long as an indication of quantities has been provided in advance; and
- to allow investors holding shares through a nominee company to attend general meetings, provided the correct authority from the nominee company is available.
Nominee companies are encouraged to provide the necessary authority to underlying shareholders to attend the Company's general meetings.
By order of the Board
Frostrow Capital LLP
Company Secretary
4 June 2026
INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2026
2026 | 2025 | ||||||
Revenue | Capital | Total | Revenue | Capital | Total | ||
Notes | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Gains/(Losses) on investments | 9 | - | 120,111 | 120,111 | - | (200,614) | (200,614) |
Exchange losses on currency balances |
| - | (2,047) | (2,047) | - | (157) | (157) |
Income from investments | 2 | 12,533 | - | 12,533 | 15,243 | - | 15,243 |
AIFM, portfolio management and performance fees | 3 | (620) | (11,769) | (12,389) | (765) | (14,542) | (15,307) |
Other expenses | 4 | (1,394) | (3) | (1,397) | (1,252) | - | (1,252) |
Net return/(loss) before finance charges and taxation |
| 10,519 | 106,292 | 116,811 | 13,226 | (215,313) | (202,087) |
Finance costs | 5 | (126) | (2,402) | (2,528) | (354) | (6,726) | (7,080) |
Net return/(loss) before taxation |
| 10,393 | 103,890 | 114,283 | 12,872 | (222,039) | (209,167) |
Taxation | 6 | (920) | - | (920) | (601) | - | (601) |
Net return/(loss) after taxation |
| 9,473 | 103,890 | 113,363 | 12,271 | (222,039) | (209,768) |
Return/(loss) per share | 7 | 2.2p | 24.5p | 26.7p | 2.4p | (42.8)p | (40.4)p |
The "Total" column of this statement is the Income Statement of the Company. The "Revenue" and "Capital" columns are supplementary to this and are prepared under guidance published by The Association of Investment Companies.
All revenue and capital items in the above statement derive from continuing operations.
The Company has no recognised gains and losses other than those shown above and therefore no separate Statement of Total Comprehensive Income has been presented.
The accompanying notes are an integral part of these statements.
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2026
Capital | Share | Total | ||||
Share | Redemption | Premium | Capital | Revenue | Shareholders' | |
Capital | Reserve | Account | Reserve | Reserve | Funds | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 1 April 2025 | 15,042 | 9,564 | 841,599 | 794,833 | 18,308 | 1,679,346 |
Net return after taxation | - | - | - | 103,890 | 9,473 | 113,363 |
Final dividend paid in respect of year ended 31 March 2025 | - | - | - | - | (8,174) | (8,174) |
Interim dividend paid in respect of year ended 31 March 2026 | - | - | - | - | (2,726) | (2,726) |
Shares purchased for treasury | - | - | - | (396,339) | - | (396,339) |
At 31 March 2026 | 15,042 | 9,564 | 841,599 | 502,384 | 16,881 | 1,385,470 |
FOR THE YEAR ENDED 31 MARCH 2025
Capital | Share | Total | ||||
Share | Redemption | Premium | Capital | Revenue | Shareholders' | |
Capital | Reserve | Account | Reserve | Reserve | Funds | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 1 April 2024 | 15,042 | 9,564 | 841,599 | 1,193,396 | 20,816 | 2,080,417 |
Net (loss)/return after taxation | - | - | - | (222,039) | 12,271 | (209,768) |
Final dividend paid in respect of year ended 31 March 2024 | - | - | - | - | (11,197) | (11,197) |
Interim dividend paid in respect of year ended 31 March 2025 | - | - | - | - | (3,582) | (3,582) |
Shares purchased for treasury | - | - | - | (176,524) | - | (176,524) |
At 31 March 2025 | 15,042 | 9,564 | 841,599 | 794,833 | 18,308 | 1,679,346 |
STATEMENT OF FINANCIAL POSITION
As at 31 March 2026
2026 | 2025 | ||
Notes | £'000 | £'000 | |
Fixed assets | |||
Investments | 9 | 1,304,264 | 1,673,659 |
Derivative - OTC swaps | 9 & 10 | 6,511 | 1,487 |
1,310,775 | 1,675,146 | ||
Current assets | |||
Debtors | 11 | 49,459 | 8,003 |
Cash | 70,821 | 93,584 | |
120,280 | 101,587 | ||
Current liabilities | |||
Creditors: amounts falling due within one year | 12 | (42,864) | (72,109) |
Derivative - OTC swaps | 9 & 10 | (2,721) | (25,278) |
(45,585) | (97,387) | ||
Net current assets | 74,695 | 4,200 | |
Total net assets | 1,385,470 | 1,679,346 | |
Capital and reserves | |||
Share capital | 13 | 15,042 | 15,042 |
Capital redemption reserve | 9,564 | 9,564 | |
Share premium account | 841,599 | 841,599 | |
Capital reserve | 17 | 502,384 | 794,833 |
Revenue reserve | 16,881 | 18,308 | |
Total shareholders' funds | 1,385,470 | 1,679,346 | |
Net asset value per share | 14 | 371.0p | 339.5p |
The financial statements were approved by the Board of Directors and authorised for issue on 4 June 2026 and were signed on its behalf by:
Doug McCutcheon
Chair
The accompanying notes are an integral part of this statement.
Worldwide Healthcare Trust PLC - Company Registration Number 3023689 (Registered in England)
STATEMENT OF CASH FLOWS
For the year ended 31 March 2026
2026 | 2025 | ||
Notes | £'000 | £'000 | |
Net cash outflow from operating activities | 18 | (775) | (1,544) |
Purchases of investments and derivatives | (889,411) | (1,048,871) | |
Sales of investments and derivatives | 1,329,282 | 1,272,404 | |
Realised loss on foreign exchange transactions | (2,061) | (157) | |
Net cash inflow from investing activities | 437,810 | 223,376 | |
Shares repurchased | (397,188) | (179,317) | |
Equity dividends paid | (10,900) | (14,779) | |
Interest paid | (2,528) | (7,080) | |
Net cash outflow from financing activities | (410,616) | (201,176) | |
Increase in net cash | 26,419 | 20,656 |
Cash flows from operating activities include interest received of £2,671,000 (2025: £3,722,000) and dividends received of £9,563,000 (2025: £12,881,000).
RECONCILIATION OF NET CASH FLOW MOVEMENT TO MOVEMENT IN NET CASH
2026 | 2025 | |
£'000 | £'000 | |
| Increase in net cash resulting from cashflows | 26,419 | 20,656 |
Gains on foreign currency cash and cash equivalents | 14 | - |
Movement in net cash in the year | 26,433 | 20,656 |
Net cash at 1 April | 25,511 | 4,855 |
Net cash at 31 March | 51,944 | 25,511 |
Net cash consists of the drawn overdraft of £18,877,000 (2025: £68,073,000) (see note 12) and cash as per the balance sheet of £70,821,000 (2025: £93,584,000).
The accompanying notes are an integral part of this statement.
NOTES TO THE FINANCIAL STATEMENTS
1. ACCOUNTING POLICIES
The principal accounting policies, all of which have been applied consistently throughout the year in the preparation of these financial statements, are set out below:
(A) Basis of preparation
These financial statements have been prepared in accordance with the Companies Act 2006, FRS 102 'The Financial Reporting Standard applicable in the UK and Ireland' ('UK GAAP') and the guidelines set out in the Statement of Recommended Practice ('SORP'), published in July 2022, for Investment Trust Companies and Venture Capital Trusts issued by the Association of Investment Companies ('AIC'), the historical cost convention, as modified by the valuation of investments and derivatives at fair value. The Board has considered a detailed assessment of the Company's ability to meet its liabilities as they fall due, including stress and liquidity tests which modelled the effects of substantial falls in markets and significant reductions in market liquidity (including further stressing the current economic conditions) on the Company's financial position and cash flows. The results of the tests showed that the Company would have sufficient cash, or the ability to liquidate a sufficient proportion of its listed holdings, to meet its liabilities as they fall due. Based on the information available to the Directors at the time of this report, including the results of the stress tests, the Company's cash balances, and the liquidity of the Company's listed investments, the Directors are satisfied that the Company has adequate financial resources to continue in operation for at least the next 12 months from the date of approval of these financial statements and that, accordingly, it is appropriate to adopt the going concern basis in preparing these financial statements.
The Company's financial statements are presented in sterling, being the functional and presentational currency of the Company.
All values are rounded to the nearest thousand pounds (£'000) except where otherwise indicated.
In addition, investments and derivatives held at fair value are categorised into a fair value hierarchy based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
· Level 1 - Quoted prices in active markets.
· Level 2 - Inputs other than quoted prices included within Level 1 that are observable (i.e. developed using market data), either directly or indirectly.
· Level 3 - Inputs are unobservable (i.e. for which market data is unavailable).
Presentation of the Income Statement
In order to reflect better the activities of an investment trust company and in accordance with the SORP, supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented alongside the Income Statement. The net revenue return is the measure the Directors believe appropriate in assessing the Company's compliance with certain requirements set out in Sections 1158 and 1159 of the Corporation Tax Act 2010.
Critical Accounting Judgements and Key Sources of Estimation Uncertainty
Critical accounting judgements and key sources of estimation uncertainty used in preparing the financial information are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable. The resulting estimates will, by definition, seldom equal the related actual results.
In the course of preparing the financial statements, the only key source of estimation uncertainty in the process of applying the Company's accounting policies, is in relation to the valuation of the unquoted (Level 3) investments. The nature of estimation means that the actual outcomes could differ from those estimates, possibly significantly. The estimates relate to the investments where there is no appropriate market price i.e. the private investments. Whilst the board considers the methodologies and assumptions adopted in the valuation are supportable, reasonable and robust, because of the inherent uncertainty of valuation, those estimated values may differ significantly from the values that would have been used had a ready market for the investment existed. As at 31 March 2026, the board has considered the significant judgements, as set out in '(B) Investments', and concluded that there is no single key assumption used in the valuation of the unquoted investments, or other key source of estimation uncertainty, that, in the Directors' opinion has a significant risk of causing a material adjustment to the carrying values of assets and liabilities within the next financial year.
Unquoted investments are all valued in line with the accounting policy set out below.
(B) Investments
Investments are measured under FRS 102 and are measured initially, and at subsequent reporting dates, at fair value. Investments are recognised and de-recognised at trade date where a purchase or sale is under a contract whose terms require delivery within the time frame established by the market concerned. Changes in fair value and gains or losses on disposal are included in the Income Statement as a capital item.
For quoted securities fair value is either bid price or last traded price, depending on the convention of the exchange on which the investment is listed.
Fair value is the price for which an asset could be exchanged between knowledgeable, willing parties in an arm's length transaction. In estimating the fair value of unquoted investments, the AIFM and Board apply valuation techniques which are appropriate in light of the nature, facts and circumstances of the investment, and use reasonable current market data and inputs combined with judgement and assumptions and apply these consistently. The following principles used in determining the valuation of unquoted investments, are consistent with the International Private Equity and Venture Capital Valuation ("IPEV") Guidelines. The assumptions and estimates made in determining the fair value of each unquoted investment are considered at least each six months or sooner if there is a triggering event. An example of where a valuation would be considered out of the six-month cycle is the success or failure of a drug under development to meet an anticipated outcome of its trial, announcement of the company undergoing an initial public offering, or other performance against tangible development milestones.
The primary valuation method applied in the valuation of the unquoted investments is the probability-weighted expected return method ("PWERM"), which considers on a probability weighted basis the future outcomes for the investment. When using the PWERM method significant judgements are made in estimating the various inputs into the model and recognising the sensitivity of such estimates. Examples of the factors where significant judgement is made include, but are not limited to, the probability assigned to potential future outcomes; discount rates; and, the likely exit scenarios for the investor company, for example, IPO or trade sale.
Where the investment being valued was itself made recently, or there has been a third party transaction in the investment, the price of the transaction may provide a good indication of fair value. Using the Price of Recent Investment technique is not a default and at each reporting date the fair value of recent investments is estimated to assess whether changes or events subsequent to the relevant transaction would imply a material change in the investment's fair value.
When using the price of a recent transaction in the valuations the Company looks to 're-calibrate' this price at each valuation point by reviewing progress within the investment, comparing against the initial investment thesis, assessing if there are any significant events or milestones that would indicate the value of the investment value has changed materially and considering whether an alternative methodology would be more appropriate.
(C) Derivative financial instruments
The Company uses derivative financial instruments (namely put and call options and equity swaps).
All derivative instruments are valued initially, and at subsequent reporting dates, at fair value in the Statement of Financial Position.
The equity swaps are accounted for as Fixed Assets or Current Liabilities.
All gains and losses on over-the-counter (OTC) equity swaps are accounted for as gains or losses on investments. Where there has been a re-positioning of the swap, gains and losses are accounted for on a realised basis. All such gains and losses have been debited or credited to the capital column of the Income Statement.
Cash collateral held by counterparties is included within cash, except where there is a right of offset against the overdraft?facility.
(D) Investment income
Dividends receivable are recognised on the ex-dividend date. Where no ex-dividend date is quoted, dividends are recognised when the Company's right to receive payment is established. Foreign dividends are grossed up at the appropriate rate of withholding tax, with the withholding tax recognised in the taxation charge.
Income from fixed interest securities is recognised on a time apportionment basis so as to reflect the effective interest rate. Deposit interest is accounted for on an accruals basis.
(E) Expenses
All expenses are accounted for on an accruals basis. Expenses are charged through the revenue column of the Income Statement except as follows:
· expenses which are incidental to the acquisition or disposal of an investment are charged to the capital column of the Income Statement; and
· expenses are charged to the capital column of the Income Statement where a connection with the maintenance or enhancement of the value of the investments can be demonstrated. In this respect the portfolio management and AIFM fees have been charged to the Income Statement in line with the Board's expected long-term split of returns, in the form of capital gains and income, from the Company's portfolio. As a result 5% of the portfolio management and AIFM fees are charged to the revenue column of the Income Statement and 95% are charged to the capital column of the Income Statement.
Any performance fee is charged in full to the capital column of the Income Statement.
(F) Finance costs
Finance costs are accounted for on an accruals basis. Finance costs are charged to the Income Statement in line with the Board's expected long-term split of returns, in the form of capital gains and income, from the Company's portfolio. As a result 5% of the finance costs are charged to the revenue column of the Income Statement and 95% are charged to the capital column of the Income Statement. Finance charges are accounted for on an accruals basis in the Income Statement using the effective interest rate method and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise.
(G) Taxation
The tax effect of different items of expenditure is allocated between capital and revenue using the marginal basis.
Deferred taxation is provided on all timing differences that have originated but not been reversed by the Statement of Financial Position date other than those differences regarded as permanent. This is subject to deferred tax assets only being recognised when it is probable that there will be suitable profits from which the reversal of timing differences can be deducted. Any liability to deferred tax is provided for at the rate of tax enacted or substantially enacted.
(H) Foreign currency
Transactions recorded in overseas currencies during the year are translated into sterling at the appropriate daily exchange rates. Assets and liabilities denominated in overseas currencies at the Statement of Financial Position date are translated into sterling at the exchange rates ruling at that date.
Exchange gains/losses on foreign currency balances
Any gains or losses on the translation of foreign currency balances, including foreign currency overdrafts, whether realised or unrealised, are taken to the capital or the revenue column of the Income Statement, depending on whether the gain or loss is of a capital or revenue nature.
(I) Capital redemption reserve
This reserve arose when ordinary shares were redeemed by the Company and subsequently cancelled. When ordinary shares are redeemed by the Company and subsequently cancelled, an amount equal to the par value of the ordinary share capital is transferred from the ordinary share capital to the capital redemption reserve.
(J) Capital reserve
The following are transferred to this reserve:
· gains and losses on the disposal of investments;
· exchange differences of a capital nature, including the effects of changes in exchange rates on foreign currency borrowings;
· expenses, together with the related taxation effect, in accordance with the above policies; and
· changes in the fair value of investments and derivatives.
This reserve can be used to distribute realised capital profits by way of dividend or share buybacks. Any gains in the fair value of investments that are not readily convertible to cash are treated as unrealised gains in the capital reserve. Distributions are only payable out of the capital reserve if realised capital reserves are greater than the proposed distribution and positive on the date of distribution.
(K) Revenue reserve
The revenue reserve is distributable by way of dividend. Dividends are only payable out of the revenue reserve if revenue reserves are greater than the proposed dividend and positive on the date of distribution.
(L) Dividend payments
Dividends paid by the Company on its shares are recognised in the financial statements in the year in which they become payable and are shown in the Statement of Changes in Equity.
(M) Cash
Cash comprises cash at bank.
Drawn overdrafts are considered a component of cash as they are repayable on demand and form an integral part of the Company's cash management.
2. INCOME FROM INVESTMENTS
2026 | 2025 | |
£'000 | £'000 | |
Income from investments | ||
Overseas dividends | 8,131 | 8,358 |
UK dividends | 1,731 | 3,163 |
9,862 | 11,521 | |
Other income |
| |
Derivatives | - | 470 |
Deposit interest | 2,671 | 3,252 |
Total income from investments | 12,533 | 15,243 |
Total income comprises: |
| |
Dividends | 9,862 | 11,521 |
Interest | 2,671 | 3,722 |
12,533 | 15,243 |
3. AIFM, PORTFOLIO MANAGEMENT AND PERFORMANCE FEES
2026 | 2025 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
AIFM fee | 124 | 2,351 | 2,475 | 139 | 2,640 | 2,779 |
Portfolio management fee | 496 | 9,418 | 9,914 | 626 | 11,902 | 12,528 |
| 620 | 11,769 | 12,389 | 765 | 14,542 | 15,307 |
See page 48 of the Annual Report for further information on the performance fee. No performance fee was payable during the year.
Further details on the above fees are set out in the Strategic Report on pages 35 and 36 of the Annual Report and in the Report of the Directors on page 48 of the Annual Report.
4. OTHER EXPENSES
2026 | 2025 | |
£'000 | £'000 | |
Directors' remuneration | 250 | 222 |
Employer's NIC on Directors' remuneration | 23 | 19 |
Auditors' remuneration for the audit of the Company's financial statements | 78 | 75 |
Depositary and custody fees | 191 | 208 |
Listing fees | 95 | 98 |
Registrar fees | 72 | 52 |
Legal and professional costs | 165 | 157 |
Other costs | 520 | 421 |
1,394 | 1,252 | |
Professional fees (Capital) | 3 | - |
1,397 | 1,252 |
Details of the amounts paid to Directors are included in the Directors' Remuneration Report.
5. FINANCE COSTS
2026 | 2025 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Finance costs | 126 | 2,402 | 2,528 | 354 | 6,726 | 7,080 |
6. TAXATION
(A) Analysis of charge in year
2026 | 2025 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Corporation tax at 25% (2025: 25%) | - | - | - | - | - | - |
Overseas taxation | 920 | - | 920 | 601 | - | 601 |
920 | - | 920 | 601 | - | 601 |
(B) Factors affecting the tax charge for the year
Approved investment trusts are exempt from tax on capital gains made within the Company.
The tax charged for the year is lower (2025: lower) than the standard rate of corporation tax of 25% (2025: 25%). The difference is explained below.
2026 | 2025 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Net return/(loss) before taxation | 10,393 | 103,890 | 114,283 | 12,872 | (222,039) | (209,167) |
Corporation tax at 25% (2025: 25%) | 2,598 | 25,972 | 28,570 | 3,218 | (55,510) | (52,292) |
Non-taxable (gains)/losses on investments | - | (29,516) | (29,516) | - | 50,194 | 50,194 |
Overseas withholding taxation | 920 | - | 920 | 601 | - | 601 |
Non taxable dividends | (2,465) | - | (2,465) | (2,881) | - | (2,881) |
Excess management expenses | (133) | 3,544 | 3,411 | (337) | 4,977 | 4,640 |
Disallowed expenses | - | - | - | - | 339 | 339 |
Total tax charge | 920 | - | 920 | 601 | - | 601 |
(C) Provision for deferred tax
No provision for deferred taxation has been made in the current or prior year. The Company has not provided for deferred tax on capital profits and losses arising on the revaluation or disposal of investments, as it is exempt from tax on these items because of its status as an investment trust company.
The Company has not recognised a deferred tax asset of £63,944,000 (25% tax rate) (2025: £59,499,000 (25% tax rate)) as a result of excess management expenses and overdraft expenses. It is not anticipated that these excess expenses will be utilised in the foreseeable future.
7. RETURN/(LOSS) PER SHARE
2026 | 2025 | |
£'000 | £'000 | |
The return/(loss) per share is based on the following figures: |
| |
Revenue return | 9,473 | 12,271 |
Capital return/(loss) | 103,890 | (222,039) |
113,363 | (209,768) | |
Weighted average number of ordinary shares in issue during the year | 424,478,964 | 518,984,143 |
Revenue return per ordinary share | 2.2p | 2.4p |
Capital return/(loss) per ordinary share | 24.5p | (42.8)p |
26.7p | (40.4)p |
The calculation of the total, revenue and capital return/(loss) per ordinary share is carried out in accordance with IAS 33, "Earnings per Share", in accordance with the requirements of FRS 102.
8. DIVIDENDS
Under UK Company Law, final dividends are not recognised until they are approved by shareholders and interim dividends are not recognised until they are paid. They are also debited directly from reserves. Amounts recognised as distributable in these financial statements were as follows:
2026 | 2025 | |
£'000 | £'000 | |
Final dividend in respect of the year ended 31 March 2024 | - | 11,197 |
Interim dividend in respect of the year ended 31 March 2025 | - | 3,582 |
Final dividend in respect of the year ended 31 March 2025 | 8,174 | - |
Interim dividend in respect of the year ended 31 March 2026 | 2,726 | - |
10,900 | 14,779 |
In respect of the year ended 31 March 2026, an interim dividend of 0.7p per share was paid on 9 January 2026. A final dividend of 1.7p will be payable, subject to shareholder approval, on 14 July 2026, the associated ex-dividend date will be 11 June 2026. The total dividends payable in respect of the year ended 31 March 2026 amount to 2.4p per share (2025: 2.4p per share,). The aggregate cost of the final dividend, based on the number of shares in issue (excluding shares held in treasury) at 3 June 2026, will be £6,348,000. In accordance with FRS 102 dividends will be reflected in the financial statements for the year in which they become payable. Total dividends in respect of the financial year, which is the basis on which the requirements of s1158 of the Corporation Tax Act 2010 are considered, are set out below.
2026 | 2025 | |
£'000 | £'000 | |
Revenue available for distribution by way of dividend for the year | 9,473 | 12,271 |
Interim dividend in respect of the year ended 31 March 2026 | (2,726) | - |
Final dividend in respect of the year ended 31 March 2026* | (6,348) | - |
Interim dividend in respect of the year ended 31 March 2025 | - | (3,582) |
Final dividend in respect of the year ended 31 March 2025 | - | (8,217) |
Net retained revenue | 399 | 472 |
* based on 363,038,777 shares in issue (excluding shares held in treasury) as at 3 June 2026.
9. INVESTMENTS AND DERIVATIVE FINANCIAL INSTRUMENTS
Derivative | |||||
Financial | |||||
Quoted | Unquoted | Instruments - | Total | ||
Investments | Investments | Total | Net | Investments | |
£'000 | £'000 | £'000 | £'000 | £'000 | |
Cost at 1 April 2025 | 1,260,233 | 119,894 | 1,380,127 | - | 1,380,127 |
Investment holdings gains/(losses) at 1 April 2025 | 306,621 | (13,089) | 293,532 | (23,791) | 269,741 |
Valuation at 1 April 2025 | 1,566,854 | 106,805 | 1,673,659 | (23,791) | 1,649,868 |
Movement in the year: | |||||
Transfer* | 31,118 | (31,118) | - | - | - |
Purchases at cost | 908,049 | - | 908,049 | - | 908,049 |
Sales proceeds/Close-out costs | (1,293,302) | (21,456) | (1,314,758) | (55,216) | (1,369,974) |
Net movement in investment holdings gains/(losses) | 55,076 | (17,762) | 37,314 | 82,797 | 120,111 |
Valuation at 31 March 2026 | 1,267,795 | 36,469 | 1,304,264 | 3,790 | 1,308,054 |
Cost at 31 March 2026 | 1,006,331 | 81,402 | 1,087,733 | - | 1,087,733 |
Investment holding gains/(losses) at 31 March 2026 | 261,464 | (44,933) | 216,531 | 3,790 | 220,321 |
Valuation at 31 March 2026 | 1,267,795 | 36,469 | 1,304,264 | 3,790 | 1,308,054 |
* See Note 16. One unquoted investment was transferred to the quoted category following its listing during the year.
The Company received £1,369,974,000 (2025: £1,271,177,000) from investments and derivatives sold in the year. The book cost of these was £1,200,443,000 (2025: £1,319,008,000). These investments and derivatives have been revalued over time and until they were sold any unrealised gains/losses were included in the fair value of the investments. The figures disclosed within this note represent the transactions recorded during the year on an accruals basis and will not necessarily align with the corresponding cash movement within the Cash Flow Statement due to the timing of transactions settling.
2026 | 2025 | |
£'000 | £'000 | |
Net movement in investment holding gains/(losses) in the year | 37,314 | (159,939) |
Net movement in derivative holding gains/(losses) in the year | 82,797 | (40,675) |
Gains/(losses) on investments | 120,111 | (200,614) |
Purchase transaction costs were £827,000 (2025: £646,000). Sales transaction costs were £949,000 (2025: £915,000). These comprise mainly commission and stamp duty.
10. DERIVATIVES
2026 | 2025 | |
£'000 | £'000 | |
Fair value of OTC equity swaps - asset | 6,511 | 1,487 |
Fair value of OTC equity swaps - liability | (2,721) | (25,278) |
3,790 | (23,791) |
See note 9 above for movements during the year.
11. DEBTORS
2026 | 2025 | |
£'000 | £'000 | |
Amounts due from brokers | 45,973 | 5,281 |
Withholding taxation recoverable | 2,413 | 1,949 |
Prepayments and accrued income | 1,073 | 773 |
49,459 | 8,003 |
12. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2026 | 2025 | |
£'000 | £'000 | |
Amounts due to brokers | 18,638 | - |
Overdraft drawn* | 18,877 | 68,073 |
Other creditors and accruals | 5,349 | 4,036 |
42,864 | 72,109 |
* The Company's borrowing requirements are met through the utilisation of an overdraft facility provided by J.P. Morgan Securities LLC. The overdraft is drawn down in U.S. dollars. Interest on the drawn overdraft is charged at the United States Overnight Bank Funding Rate plus 45 basis points.
As described on page 93 of the Annual Report, J.P. Morgan Securities LLC may take investments up to 140% of the value of the overdrawn balance as collateral and has been granted a first priority security interest or lien over the Company's assets.
13. SHARE CAPITAL
2026 | 2025 | |
Number | Number | |
As at 1 April | 494,631,804 | 545,942,332 |
Purchase of shares into treasury | (121,219,387) | (51,310,528) |
As at year end: |
| |
In circulation | 373,412,417 | 494,631,804 |
In Treasury | 228,252,783 | 107,033,396 |
Listed | 601,665,200 | 601,665,200 |
Nominal Value of 2.5p (2025: 2.5p) ordinary shares (£000) | 15,042 | 15,042 |
During the year, the Company bought back ordinary shares at a cost of £396,339,000 (Year ended 31 March 2025: £176,524,000).
14. NET ASSET VALUE PER SHARE
2026 | 2025 | |
Net asset value per share | 371.0p | 339.5p |
The net asset value per share is based on the assets attributable to equity shareholders of £1,385,470,000 (2025: £1,679,346,000) and on the number of shares in issue at the year end (excluding those shares held in treasury) of 373,412,417 (2025: 494,631,804) in issue.
15. RELATED PARTIES AND TRANSACTIONS WITH THE AIFM
The following are considered to be related parties:
· Frostrow Capital LLP (the Company's AIFM, a related party under the Listing Rules only)
· OrbiMed Capital LLC (the Company's Portfolio Manager)
· The Directors of the Company
Sven Borho is a Managing Partner at OrbiMed and has waived his Director's fee of £36,316 (2025: £35,596). Details of fees paid to OrbiMed by the Company can be found in note 3 All material related party transactions have been disclosed in notes 3 and 4.
Details of the remuneration of all Directors can be found on page 67 of the Annual Report. Details of the Directors' interests in the capital of the Company can also be found on page 67 of the Annual Report.
Three current and two former partners at OrbiMed have a minority financial interest totalling 19.2% in Frostrow, the Company's AIFM. Details of the fees paid to Frostrow by the Company can be found in note 3.
16. FINANCIAL INSTRUMENTS
Risk management policies and procedures
The Company's financial instruments comprise securities and other investments, derivative instruments, cash balances, overdrafts and debtors and creditors that arise directly from its operations.
As an investment trust, the Company invests in equities and other investments for the long term so as to secure its investment objective. In pursuing its investment objective, the Company is exposed to a variety of risks that could result in a reduction in the Company's net assets.
The main risks that the Company faces arising from its financial instruments are:
(i) market risk (including foreign currency risk, interest rate risk and other price risk)
(ii) liquidity risk
(iii) credit risk
These risks, with the exception of liquidity risk, and the Directors' approach to the management of them have not changed from the previous accounting year. The AIFM, in close co-operation with the Board and the Portfolio Manager, co - ordinates the Company's risk management.
Use of derivatives
Equity swaps are used within the Company's portfolio.
OTC equity swaps
The Company uses OTC equity swap positions to gain access to the Indian and Chinese markets when it is more cost effective to gain access via swaps or to gain exposure to thematic baskets of stocks.
Offsetting disclosure
Swap trades and OTC derivatives are traded under ISDA † Master Agreements. The Company currently has such agreements in place with Goldman Sachs and JP Morgan.
These agreements create a right of set-off that becomes enforceable only following a specified event of default, or in other circumstances not expected to arise in the normal course of business. As the right of set-off is not unconditional, for financial reporting purposes, the Company does not offset derivative assets and derivative liabilities.
† International Swap Dealers Association Inc.
(i) Other price risk
In pursuance of the Company's Investment Objective the Company's portfolio, including its derivatives, is exposed to the risk of fluctuations in market prices and foreign exchange rates.
The Board manage these risks through the use of limits and guidelines, monthly compliance reports from Frostrow and reports from Frostrow and OrbiMed presented at each Board meeting.
Other price risk exposure
The Company's gross exposure to other price risk is represented by the fair value of the investments and the underlying exposure through the derivative investments held at the year end as shown in the table below.
2026 | 2025 | |||||
Notional* | Notional* | |||||
Assets | Liabilities | exposure | Assets | Liabilities | exposure | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Investments | 1,304,264 | - | 1,304,264 | 1,673,659 | - | 1,673,659 |
OTC equity swaps | 6,511 | (2,721) | 254,852 | 1,487 | (25,278) | 207,565 |
1,310,775 | (2,721) | 1,559,116 | 1,675,146 | (25,278) | 1,881,224 | |
* The notional exposure is calculated in accordance with the AIFMD requirements for calculating exposure via derivatives. See glossary.
Other price risk sensitivity
If market prices of all of the Company's financial instruments including the derivatives at the Statement of Financial Position date had been 25% higher or lower (2025: 25% higher or lower) while all other variables remained constant: the revenue return would have decreased/increased by £0.2 million (2025: £0.2 million); the capital return would have increased/decreased by £386.0 million (2025: £462.8 million); and, the return on equity would have increased/decreased by £385.8 million (2025: £462.6 million). The calculations are based on the portfolio as at the respective Statement of Financial Position dates and are not representative of the year as a whole.
(ii)Foreign currency risk
A significant proportion of the Company's portfolio and derivative positions are denominated in currencies other than sterling (the Company's functional currency, and the currency in which it reports its results). As a result, movements in exchange rates can significantly affect the sterling value of those items.
Foreign currency exposure
The fair values of the Company's monetary assets and liabilities that are denominated in foreign currencies are shown below.
2026 | 2025 | |||||
Current | Current | Current | Current | |||
assets | liabilities | Investments | assets | liabilities | Investments | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
U.S. dollar | 117,623 | (37,515) | 1,031,645 | 98,209 | (68,073) | 1,371,703 |
Swiss franc | 1,762 | - | 57,913 | 1,301 | - | - |
Japanese yen | 406 | - | 31,976 | 386 | - | 50,227 |
Hong Kong dollar | - | - | 77,356 | - | - | 87,177 |
Other | 651 | - | 24,183 | 643 | - | 22,132 |
120,142 | (37,515) | 1,223,073 | 100,539 | (68,073) | 1,531,239 | |
Foreign currency sensitivity
The following table details the sensitivity of the Company's net return for the year and shareholders' funds to a 10% increase and decrease in sterling against the relevant currency (2025: 10% increase and decrease).
These percentages have been determined based on market volatility in exchange rates over the previous 12 months. The sensitivity analysis is based on the Company's significant foreign currency exposures at each Statement of Financial Position date.
2026 | 2025 | |||||||
USD | YEN | CHF | HKD | USD | YEN | CHF | HKD | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Sterling depreciates | 151,391 | 3,598 | 6,631 | 8,595 | 181,466 | 5,624 | 145 | 9,686 |
Sterling appreciates | (123,865) | (2,944) | (5,425) | (7,032) | (148,472) | (4,601) | (118) | (7,925) |
(iii) Interest rate risk
Interest rate changes may affect:
- the interest payable on the Company's variable rate borrowings;
- the level of income receivable from floating and fixed rate securities and cash at bank and on deposit;
- the fair value of investments in fixed interest securities.
Interest rate exposure
The Company's main exposure to interest rate risks is through its overdraft facility with J.P. Morgan Securities LLC, which is repayable on demand, and its holding in fixed interest securities. The exposure of financial assets and liabilities to fixed and floating interest rates, is shown below.
The interest rate exposure is shown in the table below.
2026 | 2025 | |
Floating | Floating | |
Rate | Rate | |
£'000 | £'000 | |
Cash | 70,821 | 101,502 |
Drawn overdraft | (18,877) | (75,991) |
Financed swap positions | (251,062) | (231,356) |
(199,118) | (205,845) |
All interest rate exposures are held in U.S. dollars.
Cash of £70.8 million (2025: £76.0 million) was held as collateral against the financed swap positions. In 2025 £7.9 million of the collateral cash was offset against the drawn overdraft.
Interest rate sensitivity
If interest rates had been 1% higher or lower and all other variables were held constant, the Company's net return for the year ended 31 March 2026 and the net assets would increase/decrease by £2.0 million (2025: increase/decrease by £2.1 million).
(iv) Liquidity risk
This is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities.
Management of the risk
Liquidity risk is not considered significant as the Company is a closed ended vehicle and the majority of the portfolio is invested in quoted securities that are readily realisable within one week, in normal market conditions. There may be circumstances where market liquidity is lower than normal. Stress tests have been performed to understand how long the portfolio would take to realise in such situations. The Board is comfortable that in such a situation the Company would be able to meet its liabilities as they fall due.
Liquidity exposure and maturity
Contractual maturities of the financial liability exposures as at 31 March 2026, based on the earliest date on which payment can be required, are as follows:
2026 | 2025 | |||
3 to 12 | 3 Months | 3 to 12 | 3 Months | |
Months | or less | Months | or less | |
£'000 | £'000 | £'000 | £'000 | |
Drawn overdraft | - | 18,877 | - | 75,991 |
Amounts due to brokers and accruals | - | 23,987 | - | 4,036 |
OTC equity swaps | 2,721 | - | 25,278 | - |
2,721 | 42,864 | 25,278 | 80,027 |
(v) Credit risk
Credit risk is the risk of failure of a counterparty to discharge its obligations resulting in the Company suffering a financial loss.
The carrying amounts of financial assets best represent the maximum credit risk at the Statement of Financial Position date.
The Company's quoted securities are held on its behalf by J.P. Morgan Securities LLC acting as the Company's Custodian and Prime Broker.
Certain of the Company's assets can be held by J.P. Morgan Securities LLC as collateral against the drawn overdraft provided by them to the Company. As at 31 March 2026 such assets held by J.P. Morgan Securities LLC are available for rehypothecation (see Glossary). As at 31 March 2026, assets with a total market value of £26.5 million (2025: £100.8 million) were available to J.P. Morgan Securities LLC to be used as collateral against the drawn overdraft which equates to 140% of the overdrawn position (calculated on a settled basis).
Credit risk exposure
2026 | 2025 | |
£'000 | £'000 | |
Derivative - OTC equity swaps | 6,511 | 1,487 |
Current assets: |
| |
Other receivables (amounts due from brokers, dividends and interest receivable) | 49,459 | 8,003 |
Cash | 70,821 | 93,584 |
(vi) Fair value of financial assets and financial liabilities
Financial assets and financial liabilities are either carried in the Statement of Financial Position at their fair value (investments and derivatives) or the Statement of Financial Position amount is a reasonable approximation of fair value (due from brokers, dividends and interest receivable, due to brokers, accrual, cash at bank, and the drawn overdraft).
(vii) Hierarchy of investments
The Company has classified its financial assets designated at fair value through profit or loss and the fair value of derivative financial instruments using a fair value hierarchy that reflects the significance of the inputs used in making the fair value measurements. The hierarchy has the following levels:
· Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;
· Level 2 - inputs other than quoted prices included with Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
· Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Level 1 | Level 2 | Level 3 | Total | |
As of 31 March 2026 | £'000 | £'000 | £'000 | £'000 |
Investments held at fair value through profit or loss | 1,267,795 | - | 36,469 | 1,304,264 |
Derivatives: OTC swaps (assets) | - | 6,511 | - | 6,511 |
Derivatives: OTC swaps (liabilities) | - | (2,721) | - | (2,721) |
Financial instruments measured at fair value | 1,267,795 | 3,790 | 36,469 | 1,308,054 |
As at 31 March 2026, four equity investments (2025: nine) and a deferred consideration investment have been classified as Level 3. All Level 3 positions have been valued in accordance with the accounting policy set out in Note 1(b). See note 9 for reconciliation of movements in Level 3 investments.
During 2026 one unquoted investment (2025: two) was transferred to Level 1 following its initial public offering. In 2025 one Level 1 investment was transferred to Level 3 following the suspension of its shares.
Level 1 | Level 2 | Level 3 | Total | |
As of 31 March 2025 | £'000 | £'000 | £'000 | £'000 |
Investments held at fair value through profit or loss | 1,566,854 | - | 106,805 | 1,673,659 |
Derivatives: OTC swaps (assets) | - | 1,487 | - | 1,487 |
Derivatives: OTC swaps (liabilities) | - | (25,278) | - | (25,278) |
Financial instruments measured at fair value | 1,566,854 | (23,791) | 106,805 | 1,649,868 |
(viii) Capital management policies and procedures
The Company's capital management objectives are to ensure that it will be able to continue as a going concern and to maximise the income and capital return to its equity shareholders through an appropriate level of gearing or leverage.
The Board's policy on gearing and leverage is set out on page 11 of the Annual Report.
As at 31 March 2026 the Company had a net leverage percentage of 12.5% (2025: 12.0%).
The capital structure of the Company consists of the equity share capital, retained earnings and other reserves as shown in the Statement of Financial Position.
The Board, with the assistance of the AIFM and the Portfolio Manager, monitors and reviews the broad structure of the Company's capital on an ongoing basis. This includes a review of:
- the planned level of gearing, which takes into account the Portfolio Manager's view of the market;
- the need to buy back equity shares, either for cancellation or to hold in treasury, in light of any share price discount to net asset value per share in accordance with the Company's share buy-back policy;
- the need for new issues of equity shares, including issues from treasury; and
- the extent to which revenue in excess of that which is required to be distributed should be retained.
The Company's objectives, policies and processes for managing capital are unchanged from the preceding accounting year.
17. CAPITAL RESERVE
Capital Reserves | |||
Investment | |||
Holding | |||
Other | Gains* | Total | |
£'000 | £'000 | £'000 | |
At 1 April 2025 | 525,092 | 269,741 | 794,833 |
Net gains/(losses) on investments | 169,531 | (49,420) | 120,111 |
Expenses and taxation charged to capital | (14,174) | - | (13,935) |
Exchange loss on currency balances | (2,047) | - | (2,047) |
Shares repurchased for Treasury | (396,339) | - | (396,339) |
At 31 March 2026 | 282,063 | 220,321 | 502,384 |
* Investment holding gains relate to the revaluation of investments and derivatives held at the reporting date. (See note 9 for further details).
Under the Company's Articles of Association, sums within "capital reserves - other" are available for distribution. The figures disclosed within this note represent the transactions recorded during the year on an accruals basis and will not necessarily align with the corresponding cash movement within the Cash Flow Statement due to the timing of transactions settling.
18. RECONCILIATION OF OPERATING RETURN/(LOSS) TO NET CASH INFLOW FROM OPERATING ACTIVITIES
2026 | 2025 | |
£'000 | £'000 | |
Net return/(loss) before finance charges and taxation | 116,811 | (202,087) |
Add: capital (return)/loss before finance charges and taxation | (106,292) | 215,313 |
Revenue return before finance charges and taxation | 10,519 | 13,226 |
Expenses charged to capital | (11,772) | (14,542) |
(Increase)/decrease in other debtors | (300) | 1,286 |
Increase/(decrease) in other creditors | 2,162 | (629) |
Net taxation suffered on investment income | (1,384) | (885) |
Net cash outflow from operating activities | (775) | (1,544) |
GLOSSARY OF TERMS AND ALTERNATIVE PERFORMANCE MEASURES ("APMS")
Active share*
Active Share is expressed as a percentage and shows the extent to which a fund's holdings and their weightings differ from those of the fund's benchmark index. A fund that closely tracks its index might have a low Active Share of less than 20% and be considered passive, while a fund with an Active Share of 60% or higher is generally considered to be actively managed.
Alternative Investment Fund Managers Directive ("AIFMD")
Agreed by the European Parliament and the Council of the European Union and transported into UK legislation, the AIFMD classifies certain investment vehicles, including investment companies, as Alternative Investment Funds (AIFs) and requires them to appoint an Alternative Investment Fund Manager (AIFM) and a depositary to manage and oversee the operations of the investment vehicle. The Board of the Company retains responsibility for strategy, operations and compliance and the Directors retain a fiduciary duty to shareholders.
Alternative performance measure ("APM")
An APM is a numerical measure of the Company's current, historical or future financial performance, financial position or cash flows, other than a financial measure defined or specified in the applicable financial framework. In selecting these Alternative Performance Measures, the Directors considered the key objectives and expectations of typical investors in an investment trust such as the Company.
Benchmark
The performance of the Company is measured against the MSCI World Health Care Index on a net total return, sterling adjusted basis.
The net total return is calculated by reinvesting dividends after the deduction of withholding taxes.
Large Cap Biotech
Biotechnology companies with fully-integrated discovery, development and commercial capabilities and considered sustainably profitable.
Large Cap Pharma
Global, multinational pharmaceutical companies with fully-integrated discovery, development and commercial capabilities.
Discount or premium*
A description of the difference between the share price and the net asset value per share. The size of the discount or premium is calculated by subtracting the share price from the net asset value per share and is usually expressed as a percentage (%) of the net asset value per share. If the share price is higher than the net asset value per share the result is a premium. If the share price is lower than the net asset value per share, the shares are trading at a discount.
Emerging Biotech
Biotechnology companies that do not fit the criteria of Large Cap Biotech, ranging from early-stage development to newly profitable.
Equity swaps
An equity swap is an agreement where one party (counterparty) transfers the total return of an underlying equity position to the other party (swap holder) in exchange for a payment of the principal, and interest for financed swaps, at a set date. Total return includes dividend income and gains or losses from market movements. The exposure of the holder is the market value of the underlying equity position.
The Company currently only uses financed equity swaps, where payment is made on maturity. Financed swaps increase exposure by the value of the underlying equity position, with no initial outlay and no increase in the investment portfolio's value - there is therefore embedded leverage within a financed swap due to the deferral of payment to maturity.
* Alternative Performance Measure
The Company employs swaps for two purposes:
· To gain access to individual stocks in the Indian, Chinese and other emerging markets, where the Company is not locally registered to trade or is able to gain in a more cost efficient manner than holding the stocks directly; and,
· To gain exposure to thematic baskets of stocks (a Basket Swap). Basket Swaps are used to build exposure to themes, or ideas, that the Portfolio Manager believes the Company will benefit from and where holding a Basket Swap is more cost effective and operationally efficient than holding the underlying stocks or individual swaps.
Gearing
Gearing is calculated as the drawn overdraft, less net current assets (excluding dividends), divided by Net Assets, expressed as a percentage. For years prior to 2013, the calculation was based on borrowings as a percentage of Net Assets.
Generics
Any therapeutics company, domestic or global, that focuses a majority of its efforts (not necessarily 100%) on developing and selling generic and/or biosimilar prescription and/or OTC products.
Leverage
Leverage is defined in the AIFMD as any method by which the AIFM increases the exposure of an AIF. In addition to the gearing limit the Company also has to comply with the AIFMD leverage requirements. For these purposes the Board has set a maximum leverage limit of 140% for both methods. This limit is expressed as a % with 100% representing no leverage or gearing in the Company. There are two methods of calculating leverage as follows:
The Gross Method is calculated as total exposure divided by Shareholders' Funds. Total exposure is calculated as net assets, less cash and cash equivalents, adding back cash borrowing plus derivatives converted into the equivalent position in their underlying assets.
The Commitment Method is calculated as total exposure divided by Shareholders Funds. In this instance total exposure is calculated as net assets, less cash and cash equivalents, adding back cash borrowing plus derivatives converted into the equivalent position in their underlying assets, adjusted for netting and hedging arrangements.
See the definition of Equity Swaps for more details on how exposure through these instruments is calculated.
2026 £'000 | 2025 £'000 | |||
Fair Value | Exposure* | Fair Value | Exposure* | |
Investments | 1,304,264 | 1,304,264 | 1,673,659 | 1,673,659 |
OTC equity swaps | 3,790 | 254,852 | (23,791) | 207,565 |
1,308,054 | 1,559,116 | 1,649,868 | 1,881,224 | |
Shareholders' funds |
| 1,385,470 | 1,679,346 | |
Leverage % |
| 12.5% | 12.0% | |
* Calculated in accordance with AIFMD requirements using the Commitment Method
MSCI World Health Care Index (the Company's Benchmark)
The MSCI World Health Care Index is designed to capture the large and mid capitalisation segments across 23 developed markets countries: All securities in the index are classified as healthcare as per the Global Industry Classification Standard (GICS). Developed Markets countries include: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland the UK and the U.S. The net total return of the Index is used which assumes the reinvestment of any dividends paid by its constituents after the deduction of relevant withholding taxes. The performance of the Index is calculated in U.S.$ terms. Because the Company's reporting currency is £ the prevailing U.S.$/£ exchange rate is applied to obtain a £ based return.
NAV per share (pence)
The value of the Company's assets, principally investments made in other companies and cash being held, minus any liabilities. The NAV is also described as 'shareholders' funds' per share. The NAV is often expressed in pence per share after being divided by the number of shares which have been issued. The NAV per share is unlikely to be the same as the share price which is the price at which the Company's shares can be bought or sold by an investor. The share price is determined by the relationship between the demand and supply of the shares.
* Alternative Performance Measure
Net asset value (NAV) per share total return*
The theoretical total return on shareholders' funds per share, reflecting the change in NAV assuming that dividends paid to shareholders were reinvested at NAV at the time the shares were quoted ex-dividend. A way of measuring investment management performance of investment trusts which is not affected by movements in discounts/premiums.
2026 | 2025 | |
NAV Total Return | p | p |
Opening NAV | 339.5 | 381.1 |
Increase/(decrease) in NAV | 31.5 | (41.6) |
Closing NAV | 371.0 | 339.5 |
% increase/(decrease) in NAV | 9.3% | (10.9)% |
Impact of reinvested dividends | 0.7% | 0.6% |
NAV Total Return | 10.0% | (10.3)% |
Ongoing Charges*
Ongoing charges are calculated by taking the Company's annualised ongoing charges, excluding finance costs, taxation, performance fees and exceptional items, and expressing them as a percentage of the average daily net asset value of the Company over the year.
2026 | 2025 | |
£'000 | £'000 | |
AIFM & Portfolio Management fees (Note 3) | 12,389 | 15,307 |
Other Expenses - Revenue (Note 4) | 1,394 | 1,252 |
Total Ongoing Charges | 13,783 | 16,559 |
Performance fees paid/crystallised | - | - |
Total | 13,783 | 16,559 |
Average net assets | 1,517,239 | 1,984,818 |
Ongoing Charges | 0.9% | 0.8% |
Ongoing Charges (including performance fees paid or crystallised during the year) | 0.9% | 0.8% |
Rehypothecation
Rehypothecation is the practice by banks and brokers of using, for their own purposes, assets that have been posted as collateral by clients.
Share Price Total Return*
Return to the investor on mid-market prices assuming that all dividends paid were reinvested.
2026 | 2025 | |
Share Price Total Return | p | p |
Opening share price | 297.5 | 335.0 |
Increase/(decrease) in share price | 36.5 | (37.5) |
Closing share price | 334.0 | 297.5 |
% increase/(decrease) in share price | 12.3% | (11.2)% |
Impact of reinvested dividends | 0.8% | 0.7% |
Share Price Total Return | 13.1% | (10.5)% |
Spec Pharma
Any other therapeutics company that does not fit the criteria of Large Cap Pharma or Generics that develop and sell pharmaceutical products, often focused on a limited number of therapeutic areas (or technologies), with a domestic and sometimes global footprint.
* Alternative Performance Measure
NOTICE OF THE ANNUAL GENERAL MEETING
Notice is hereby given that the Annual General Meeting of Worldwide Healthcare Trust PLC will be held at Barber-Surgeons', Monkwell Square, Wood Street, City of London EC2Y 5BL on Tuesday, 14 July 2026 from 12.30 pm for the following purposes:
Ordinary Resolutions
To consider and, if thought fit, pass the following resolutions which will be proposed as ordinary resolutions:
1. That the Report of the Directors and the audited Financial Statements for the year ended 31 March 2026 together with the Report of the Auditors thereon be received and adopted.
2. To approve the payment of a final dividend of 1.7p per ordinary share for the year ended 31 March 2026.
3. To approve the Company's dividend policy, as set out on page 34 of the Annual Report for the year ended 31 March 2026.
4. To re-elect Mr Sven Borho as a Director of the Company.
5. To re-elect Ms Sian Hansen as a Director of the Company.
6. To re-elect Mr William Hemmings as a Director of the Company.
7. To re-elect Mr Tim Livett as a Director of the Company.
8. To re-elect Ms Jo Parfrey as a Director of the Company.
9. To re-elect Dr Bina Rawal as a Director of the Company.
10. To re-appoint PricewaterhouseCoopers LLP as the Company's Auditors and to authorise the Audit & Risk Committee to determine their remuneration.
11. To approve the Directors' Remuneration Report for the year ended 31 March 2026.
12. To approve the Directors' Remuneration Policy.
Authority to Allot Shares
13. THAT in substitution for all existing authorities the Directors be and are hereby generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006 (the "Act") to exercise all powers of the Company to allot relevant securities (within the meaning of section 551 of the Act) up to a maximum aggregate nominal amount equal to 10% of the issued share capital of the Company at 3 June 2026 (or, if changed, the number representing 10% of the issued share capital of the Company at the date at which this resolution is passed), provided that this authority shall expire at the conclusion of the Annual General Meeting of the Company to be held in 2027 or 15 months from the date of passing this resolution, whichever is the earlier, unless previously revoked, varied or renewed, by the Company in General Meeting and provided that the Company shall be entitled to make, prior to the expiry of such authority, an offer or agreement which would or might require relevant securities to be allotted after such expiry and the Directors may allot relevant securities pursuant to such offer or agreement as if the authority conferred hereby had not expired.
Special Resolutions
To consider and, if thought fit, pass the following resolutions which will be proposed as special resolutions:
Disapplication of Pre-Emption Rights
14. THAT in substitution for all existing powers (and in addition to any power conferred on them by resolution 15 set out in the notice convening the Annual General Meeting at which this resolution is proposed ("Notice of Annual General Meeting")) the Directors be and are hereby generally empowered pursuant to Section 570 of the Companies Act 2006 (the "Act") to allot equity securities (within the meaning of Section 560 of the Act) for cash pursuant to the authority conferred on them by resolution 13 set out in the Notice of Annual General Meeting or otherwise as if Section 561(1) of the Act did not apply to any such allotment:
(a) pursuant to an offer of equity securities open for acceptance for a period fixed by the Directors where the equity securities respectively attributable to the interests of holders of shares in the capital of the Company ("Shares") are proportionate (as nearly as may be) to the respective numbers of Shares held by them but subject to such exclusions or other arrangements in connection with the issue as the Directors may consider necessary, appropriate or expedient to deal with equity securities representing fractional entitlements or to deal with legal or practical problems arising in any overseas territory, the requirements of any regulatory body or stock exchange, or any other matter whatsoever;
(b) provided that (otherwise than pursuant to sub-paragraph (a) above) this power shall be limited to the allotment of equity securities up to an aggregate nominal value equal to 10% of the issued share capital of the Company at 3 June 2026 (or, if changed, the number representing 10% of the issued share capital of the Company at the date at which this resolution is passed) and provided further that (i) the number of equity securities to which this power applies shall be reduced from time to time by the number of treasury shares which are sold pursuant to any power conferred on the Directors by resolution 15 set out in the Notice of Annual General Meeting and (ii) no allotment of equity securities shall be made under this power which would result in Shares being issued at a price which is less than the net asset value per Share as at the latest practicable date before such allotment of equity securities as determined by the Directors in their reasonable discretion; and
such power shall expire at the conclusion of the next Annual General Meeting of the Company after the passing of this resolution or 15 months from the date of passing this resolution, whichever is earlier, unless previously revoked, varied or renewed by the Company in General Meeting and provided that the Company shall be entitled to make, prior to the expiry of such authority, an offer or agreement which would or might otherwise require equity securities to be allotted after such expiry and the Directors may allot equity securities pursuant to such offer or agreement as if the power conferred hereby had not expired.
15. THAT in substitution for all existing powers (and in addition to any power conferred on them by resolution 14 set out in the Notice of Annual General Meeting) the Directors be and are hereby generally empowered pursuant to Section 570 of the Companies Act 2006 (the "Act") to sell relevant shares (within the meaning of Section 560 of the Act) if, immediately before the sale, such shares are held by the Company as treasury shares (as defined in Section 724 of the Act ("treasury shares")), for cash as if Section 561(1) of the Act did not apply to any such sale provided that:
(a) this power shall be limited to the sale of relevant shares having an aggregate nominal value equal to 10% of the issued share capital of the Company at 3 June 2026 (or, if changed, the number representing 10% of the issued share capital of the Company at the date at which this resolution is passed) and provided further that the number of relevant shares to which power applies shall be reduced from time to time by the number of Shares which are allotted for cash as if Section 561(1) of the Act did not apply pursuant to the power conferred on the Directors by resolution 14 set out in the Notice of Annual General Meeting,
and such power shall expire at the conclusion of the next Annual General Meeting of the Company after the passing of this resolution or 15 months from the date of passing this resolution, whichever is earlier, unless previously revoked, varied or renewed by the Company in General Meeting and provided that the Company shall be entitled to make, prior to the expiry of such authority, an offer or agreement which would or might otherwise require treasury shares to be sold after such expiry and the Directors may sell treasury shares pursuant to such offer or agreement as if the power conferred hereby had not expired.
Authority to Repurchase Ordinary Shares
16. THAT the Company be and is hereby generally and unconditionally authorised in accordance with section 701 of the Companies Act 2006 (the "Act") to make one or more market purchases (within the meaning of section 693 of the Act) of ordinary shares in the capital of the Company ("Shares") (either for retention as treasury shares for future reissue, resale, transfer or cancellation), provided that:
(a) the maximum aggregate number of Shares authorised to be purchased shall be that number of shares which is equal to 14.99% of the issued share capital of the Company as of the value of the date of the passing of this resolution;
(b) the minimum price (exclusive of expenses) which may be paid for a Share is 2.5 pence;
(c) the maximum price (exclusive of expenses) which may be paid for a Share is an amount equal to the greater of (i) 105% of the average of the middle market quotations for a Share as derived from the Daily Official List of the London Stock Exchange for the five business days immediately preceding the day on which that Share is purchased and (ii) the higher of the price of the last independent trade and the highest then current independent bid on the London Stock Exchange as stipulated in the technical standards referred to in Article 5(6) of the Market Abuse Regulation (EU) No. 596/2014 (which forms part of UK law by virtue of the European Union (Withdrawal) Act 2018);
(d) the authority hereby conferred shall expire at the conclusion of the Annual General Meeting of the Company to be held in 2027 or, if earlier, on the expiry of 15 months from the date of the passing of this resolution unless such authority is renewed prior to such time; and
(e) the Company may make a contract to purchase Shares under this authority before the expiry of such authority which will or may be executed wholly or partly after the expiration of such authority, and may make a purchase of Shares in pursuance of any such contract.
Adoption of the new Articles of Association
17. THAT the Articles of Association set out in the document produced to this meeting and signed by the Chairman of the meeting for the purposes of identification be and are hereby approved and adopted as the Articles of Association of the Company in substitution for and to the exclusion of the existing Articles of Association of the Company.
General Meetings
18. THAT the Directors be authorised to call general meetings (other than the Annual General Meeting of the Company) on not less than 14 clear days' notice, such authority to expire on the conclusion of the next Annual General Meeting of the Company, or, if earlier, on the expiry 15 months from the date of the passing of the resolution.
By order of the Board | Registered Office: |
One Wood Street | |
Frostrow Capital LLP | London EC2V 7WS |
Company Secretary | |
4 June 2026 | |
NOTES
1. Members are entitled to appoint a proxy to exercise all or any of their rights to attend and to speak and vote on their behalf at the meeting. A shareholder may appoint more than one proxy in relation to the meeting provided that each proxy is appointed to exercise the rights attached to a different share or shares held by that shareholder. A proxy need not be a shareholder of the Company.
2. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes for or against the resolutions. If no voting indication is given, a proxy may vote or abstain from voting at his/her discretion. A proxy may vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is put before the meeting.
3. This year, hard copy forms of proxy have not been included with this notice. Members can vote by: logging onto https://uk.investorcentre.mpms.mufg.com/ and following instructions; requesting a hard copy form of proxy directly from the registrars, MUFG Corporate Markets at shareholderenquiries@cm.mpms. mufg.com or in the case of CREST members, utilising the CREST electronic proxy appointment service in accordance with the procedures set out below. To be valid any proxy form or other instrument appointing a proxy must be completed and signed and received by post or (during normal business hours only) by hand at MUFG Corporate Markets, PXS1, Central Square, 29 Wellington Street, Leeds LS1 4DL no later than 12.30 p.m. on Friday, 10 July 2026. Alternatively if you are an institutional shareholder you may also be able to appoint a proxy electronically via the proxymity platform (see note 14 below). Shareholders can vote electronically via the Investor Centre, a free app for smartphone and tablet provided by MUFG Corporate Markets (the Company's registrar). It allows you to securely manage and monitor your shareholdings in real time, take part in online voting, keep your details up to date, access a range of information including payment history and much more. The app is available to download on both the Apple App Store and Google Play, or by scanning the relevant QR code below.
4. In the case of a member which is a company, the instrument appointing a proxy must be executed under its seal or signed on its behalf by a duly authorised officer or attorney or other person authorised to sign. Any power of attorney or other authority under which the instrument is signed (or a certified copy of it) must be included with the instrument.
5. The return of a completed proxy form, other such instrument or any CREST Proxy Instruction or appointing a proxy via Proxymity (as described below) will not prevent a shareholder attending the meeting and voting in person if he/she wishes to do so.
6. Any person to whom this notice is sent who is a person nominated under section 146 of the Companies Act 2006 to enjoy information rights (a "Nominated Person") may, under an agreement between him/her and the shareholder by whom he/she was nominated, have a right to be appointed (or have someone else appointed) as a proxy for the meeting. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the exercise of voting rights.
7. The statement of the rights of shareholders in relation to the appointment of proxies in paragraphs 1 and 3 above does not apply to Nominated Persons. The rights described in these paragraphs can only be exercised by shareholders of the Company.
8. Pursuant to regulation 41 of the Uncertificated Securities Regulations 2001, only shareholders registered on the register of members of the Company (the "Register of Members") at the close of business on Friday, 10 July 2026 (or, in the event of any adjournment, on the date which is two days before the time of the adjourned meeting) will be entitled to attend and vote or be represented at the meeting in respect of shares registered in their name at that time. Changes to the Register of Members after that time will be disregarded in determining the rights of any person to attend and vote at the meeting.
9. As at 3 June 2026 (being the last business day prior to the publication of this notice) the Company's issued share capital consists of 601,665,200 ordinary shares, carrying one vote each. The Company holds 238,626,423 shares in treasury. Therefore, the total voting rights in the Company as at 3 June 2026 are 363,038,777.
10. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so by using the procedures described in the CREST Manual. CREST Personal Members or other CREST sponsored members, and those CREST members who have appointed a service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf.
11. In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a "CREST Proxy Instruction") must be properly authenticated in accordance with the specifications of Euroclear UK and International ("CRESTCo"), and must contain the information required for such instruction, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the issuer's agent (ID RA10) no later than 48 hours excluding non-business hours before the time appointed for holding the meeting. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which the issuer's agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means.
12. CREST members and, where applicable, their CREST sponsors, or voting service providers should note that CRESTCo does not make available special procedures in CREST for any particular message. Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed a voting service provider, to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
13. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations?2001.
14. If you are an institutional investor you may also be able to appoint a proxy electronically via the Proxymity platform, a process which has been agreed by the Company and approved by the Registrar. For further information regarding Proxymity, please go to www.proxymity.io. Your proxy must be lodged by 12.30pm on 10 July 2026 in order to be considered valid or, in the event of any adjournment, 48 hours, excluding non-business days, before the time of the adjourned meeting. Before you can appoint a proxy via this process you will need to have agreed to Proxymity's associated terms and conditions. It is important that you read these carefully as you will be bound by them and they will govern the electronic appointment of your proxy. An electronic proxy appointment via the Proxymity platform may be revoked completely by sending an authenticated message via the platform instructing the removal of your proxy vote.
15. In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in which the names of the joint holders appear in the Register of Members in respect of the joint holding (the first named being the most senior).
16. Members who wish to change their proxy instructions should submit a new proxy appointment using the methods set out above. Note that the cut-off time for receipt of proxy appointments (see above) also applies in relation to amended instructions; any amended proxy appointment received after the relevant cut-off time will be disregarded.
17. Members who have appointed a proxy using the hard-copy proxy form and who wish to change the instructions using another hard-copy form, should contact MUFG Corporate Markets on 0371 664 0300 or +44 371 664 0300. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom are charged at the applicable international rate. Lines are open 09.00 to 17.30 Monday to Friday excluding public holidays in England and Wales.
18. If a member submits more than one valid proxy appointment, the appointment received last before the latest time for the receipt of proxies will take?precedence.
19. In order to revoke a proxy instruction, members will need to inform the Company. Members should send a signed hard copy notice clearly stating their intention to revoke a proxy appointment to MUFG Corporate Markets, PXS1, 29 Wellington Street, Central Square, Leeds LS1 4DL. In the case of a member which is a company, the revocation notice must be executed under its common seal or signed on its behalf by an officer of the company or an attorney for the company. Any power of attorney or any other authority under which the revocation notice is signed (or a duly certified copy of such power of attorney) must be included with the revocation notice. If a member attempts to revoke their proxy appointment but the revocation is received after the time for receipt of proxy appointments (see above) then, subject to paragraph 4 above, the proxy appointment will remain valid.
EXPLANATORY NOTES TO THE RESOLUTIONS
Resolution 1 - To receive and adopt the Annual Report and Financial Statements
The Annual Report and Financial Statements for the year ended 31 March 2026 will be presented to the Annual General Meeting ("AGM"). These accounts accompany this Notice of Meeting.
Resolution 2 - To approve a Final Dividend
The rationale for the payment of a final dividend is set out in the Statement from the Chair, in the Business Review and the Report of the Directors.
Resolution 3 - Approval of the Company's Dividend Policy
Resolution 3 seeks shareholder approval of the Company's dividend policy, which is set out on page 34 of the Annual Report.
Resolutions 4 to 9 - Re-election of Directors
Resolutions 4 to 9 deal with the re-election of the Directors. Biographies of each of the Directors can be found on pages 46 to 47 of the Annual Report.
The Board has confirmed, following a performance review, that the Directors standing for re-election continue to perform effectively.
Resolution 10 - Re-appointment of Auditors and the determination of their remuneration
Resolution 11 relates to the re-appointment of PricewaterhouseCoopers LLP as the Company's independent Auditors to hold office until the next AGM of the Company and also authorises the Audit & Risk Committee to set their remuneration (see pages 64 and 65 of the Annual Report for further information).
Resolution 11 - Directors' Remuneration Report
The Directors' Remuneration Report is set out on pages 66 to 68 in the Annual Report.
Resolution 12 - Directors' Remuneration Policy
The Directors' Remuneration Policy is set out on page 66 of the Annual Report
Resolutions 13, 14 and 15 - Issue of Shares
Ordinary Resolution 13 in the Notice of AGM will renew the authority to allot the unissued share capital up to an aggregate nominal amount equal to 10% of the aggregate nominal amount of the Company's issued share capital on 3 June 2026, being the nearest practicable date prior to the signing of this Report (or if changed, the number representing 10% of the issued share capital of the Company at the date at which the resolution is passed). Such authority will expire on the date of the next AGM or after a period of 15 months from the date of the passing of the resolution, whichever is earlier. This means that the authority will have to be renewed at the next AGM.
When shares are to be allotted for cash, Section 551 of the Companies Act 2006 (the "Act") provides that existing shareholders have pre-emption rights and that the new shares must be offered first to such shareholders in proportion to their existing holding of shares. However, shareholders can, by special resolution, authorise the Directors to allot shares otherwise than by a pro rataissue to existing shareholders. Special Resolution 14 will, if passed, give the Directors power to allot for cash equity securities up to an aggregate nominal amount equal to 10% of the Company's share capital on 3 June 2026 (or if changed, the number representing 10% of the issued share capital of the Company at the date at which the resolution is passed), as if Section 551 of the Act does not apply. This is the same nominal amount of share capital which the Directors are seeking the authority to allot pursuant to Resolution 15. This authority will also expire on the date of the next Annual General Meeting or after a period of 15 months, whichever is earlier. This authority will not be used in connection with a rights issue by the Company.
Under the Companies (Acquisition of Own Shares) (Treasury Shares) Regulations 2003 (as amended) (the "Treasury Share Regulations") the Company is permitted to buyback and hold shares in treasury and then sell them at a later date for cash, rather than cancelling them. The Treasury Share Regulations require such sale to be on a pre-emptive, pro rata, basis to existing shareholders unless shareholders agree by special resolution to disapply such pre-emption rights. Accordingly, in addition to giving the Directors power to allot unissued share capital on a non pre-emptive basis pursuant to Resolution 14, Resolution 15, if passed, will give the Directors authority to sell shares held in treasury on a non pre-emptive basis. No dividends may be paid on any shares held in treasury and no voting rights will attach to such shares. The benefit of the ability to hold treasury shares is that such shares may be resold. This should give the Company greater flexibility in managing its share capital, and improve liquidity in its shares. It is the intention of the Board that any re-sale of treasury shares would only take place at a premium to the cum income net asset value per share. It is also the intention of the Board that sales from treasury would only take place when the Board believes that to do so would assist in the provision of liquidity to the market. The number of treasury shares which may be sold pursuant to this authority is limited to an aggregate nominal amount equal to 10% of the Company's share capital on 3 June 2026 (or if changed, the number representing 10% of the issued share capital of the Company at the date at which the resolution is passed) (reduced by any equity securities allotted for cash on a non-pro ratabasis pursuant to Resolution 14, as described above). This authority will also expire on the date of the next Annual General Meeting or after a period of 15 months, whichever is earlier.
The Directors intend to use the authority given by Resolutions 13, 14 and 15 to allot shares and disapply pre-emption rights only in circumstances where this will be clearly beneficial to shareholders as a whole. The issue proceeds would be available for investment in line with the Company's investment policy. No issue of shares will be made which would effectively alter the control of the Company without the prior approval of shareholders in general meeting.
New Shares will only be issued at a premium to the Company's cum income net asset value per share at the time of issue.
Resolution 16 - Share Repurchases
The Directors wish to renew the authority given by shareholders at the previous AGM. The principal aim of a share buyback facility is to enhance shareholder value by acquiring shares at a discount to net asset value, as and when the Directors consider this to be appropriate. The purchase of Shares, when they are trading at a discount to net asset value per share should result in an increase in the net asset value per share for the remaining shareholders. This authority, if conferred, will only be exercised if to do so would result in an increase in the net asset value per share for the remaining shareholders and if it is in the best interests of shareholders generally. Any purchase of shares will be made within guidelines established from time to time by the Board. It is proposed to seek shareholder authority to renew this facility for another year at the AGM.
Under the current Listing Rules, the maximum price that may be paid on the exercise of this authority must not exceed the higher of (i) 105% of the average of the middle market quotations for the shares over the five business days immediately preceding the date of purchase and (ii) the higher of the last independent trade and the highest current independent bid on the trading venue where the purchase is carried out. The minimum price which may be paid is 2.5p per Share. Existing shares which are purchased under this authority will either be cancelled or held as Treasury Shares.
Special Resolution 16 in the Notice of AGM will renew the authority to purchase in the market a maximum of 14.99% of the issued share capital of the Company as at the date of the passing of the resolution, 14.99% of the issued share capital of the Company as changed by that resolution. Such authority will expire on the date of the next AGM or after a period of 15 months from the date of passing of the resolution, whichever is earlier. This means in effect that the authority will have to be renewed at the next AGM or earlier if the authority has been exhausted.
Resolution 17 - New Articles of Association
Under Special Resolution 17, the Company is proposing to amend the Articles of Association to introduce additional contingency provisions relating to the election of directors at general meetings. These amendments reflect recent market guidance and are intended to ensure the orderly and effective governance of the Company in the event that insufficient directors are elected at a general meeting.
Set out below is a summary of the main differences between the current and the proposed new Articles of Association (the "New Articles").
The Company is proposing to amend the Articles of Association to introduce additional contingency provisions relating to the election of directors at general meetings. These amendments reflect recent market guidance and are intended to ensure the orderly and effective governance of the Company in the event that insufficient directors are elected at a general meeting.
The new provisions operate automatically in the limited circumstances where, following a general meeting at which directors are to be elected or re - elected, the Board would be left with none or only one director in office. In such circumstances, the provisions allow for a small number of retiring directors to be temporarily re - appointed for the sole purpose of maintaining continuity, protecting shareholders' interests and convening a further general meeting to elect directors.
Any such appointments are strictly interim and are designed to protect shareholders' interests and ensure compliance with applicable legal and regulatory requirements.
A copy of the current Articles and of the proposed New Articles marked up to show the proposed amendments will be available for inspection at the Company's registered office during normal business hours and will be available for inspection at the Annual General Meeting, in each case until conclusion of the meeting."
Resolution 18 - General Meetings
Special Resolution 18 seeks shareholder approval for the Company to hold General Meetings (other than the AGM) at 14 clear days' notice. The Board confirms that the shorter notice period would only be used where it was merited by the purpose of the meeting.
Recommendation
The Board considers that the resolutions relating to the above items are in the best interests of shareholders as a whole. Accordingly, the Board unanimously recommends to the shareholders that they vote in favour of the above resolutions to be proposed at the forthcoming AGM as the Directors intend to do in respect of their own beneficial holdings totalling 635,864 shares.
ENDS-
Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.
For further information please contact
Mark Pope
For and on behalf of Frostrow Capital LLP
Company Secretary
0203 008 4913
