POLAR CAPITAL GLOBAL FINANCIALS TRUST PLC

Legal Entity Identifier: 549300G5SWN8EP2P4U41

PRELIMINARY UNAUDITED ANNUAL RESULTS FOR THE YEAR ENDED 30 NOVEMBER 2021

PERFORMANCE HIGHLIGHTS FOR THE YEAR ENDED 30 NOVEMBER 2021

Dividends

The Company has paid or declared the following dividends relating to the financial year ended 30 November 2021:

Note 1   

The total return NAV performance for the period is calculated by reinvesting the dividends in the assets of the Company from the relevant ex-dividend date. Performance since inception has been calculated using the initial NAV of 98p and the NAV on 30 November 2021. Dividends are deemed to be reinvested on the ex-dividend date as this is the protocol used by the Company's benchmark and other indices.

Note 2   

The total return share price performance is calculated by reinvesting the dividends in the shares of the Company from the relevant ex-dividend date. Performance since inception has been calculated using the launch price of 100p to the closing price on 30 November 2021.

Note 3   

The total return share price performance since inception includes the value of the subscription shares issued free of payment at launch on the basis of one for every five Ordinary shares and assumes such were held throughout the period from launch to the final conversion date of 31 July 2017. Performance is calculated by reinvesting the dividends in the shares of the Company from the relevant ex-dividend date and uses the launch price of 100p per Ordinary share and the closing price per Ordinary share on 30 November 2021.

Note 4   

The benchmark changed on 23 April 2020 to MSCI ACWI Financials Net Total Return Index (in Sterling) due to the Company's exposure to Emerging Market financials equities and its limited exposure to real estate equities. Prior to this the Company's benchmark was MSCI World Financials + Real Estate Net Total Return Index. Preceding 31 August 2016, the Company's benchmark was the MSCI World Financials Index, which included Real Estate as a constituent until its removal that year. Benchmark performance above illustrates linked performance of these benchmarks.

Note 5   

Dynamic average of open ended funds in the Lipper Financial Sector Universe which comprised 47 open ended funds in the year under review.

Note 6   

The total return NAV performance since the Reconstruction is calculated by reinvesting the dividends in the assets of the Company from the relevant ex-dividend date. The new performance fee period runs from the date of the Reconstruction. The opening NAV for the performance fee of 102.8p is the closing NAV the day before the tender offer was completed.

Note 7

Refer to note 11 below for more details.

^ The change in net assets reflects shares reissued from treasury in the year, new shares issued, including those from conversion of the C share issue, dividends paid and market movements.

* See Alternative Performance Measure provided below.

~ The performance fee calculation methodology has been amended to remove an unintended outcome of the previous methodology, see note 18 below.

Data sourced by HSBC Securities Services Limited, Polar Capital LLP and Lipper.

Status of Announcement 

The figures and financial information contained in this announcement are extracted from the draft unaudited financial results for the year ended 30 November 2021 and do not constitute statutory accounts for that year. Once finalised, the Annual Report and Financial Statements will include the Report of the Independent Auditors which is expected to be unqualified and not expected to contain a statement under either section 498(2) or Section 498(3) of the Companies Act 2006. The Annual Report and Financial Statements for the year ended 30 November 2021 have not yet been delivered to the Registrar of Companies.

The figures and financial information for the year ended 30 November 2020 have been extracted from the published Annual Report and Financial Statements for the year ended 30 November 2020 and do not constitute the statutory accounts for that year. The Annual Report and Financial Statements for the year ended 30 November 2020 have been delivered to the Registrar of Companies and included the Report of the Independent Auditors which was unqualified and did not contain a statement under either section 498(2) or Section 498(3) of the Companies Act 2006.

The Directors' Remuneration Report and certain other helpful shareholder information has not been included in this announcement but will form part of the finalised Annual Report which will be available on the Company's website and will be sent to shareholders in March 2022.

National Storage Mechanism  

A copy of the Annual Report once published will be submitted to the National Storage Mechanism ('NSM') and will then be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

Neither the contents of the Company's website nor the contents of any website accessible from the hyperlinks on the Company's website (or any other website) are incorporated into or form part of this announcement.

CHAIRMAN'S STATEMENT

Dear Shareholders,

2021 was the year of the COVID-19 vaccine - two doses and a booster battling new variants and conspiracy theorists. As I write the battle continues, but with signs suggesting a cohabitation with the virus that allows some kind of return to normality is on the horizon.

In last year's Chairman's statement, I spoke of green shoots for the Company with signs of a change in sentiment towards the financial sector. These shoots blossomed in 2021. During the financial year under review the Company recorded a net asset value total return of 27.9%, outperforming broader market indices.

The dramatic improvement in sentiment towards the sector and Company is best demonstrated by share capital changes between the latest and previous financial years. In the 2020 financial year (FY20) the Company bought into treasury a total of 79,159,235 ordinary shares following the tender offer in April 2020 and made further purchases to support liquidity in the Company's shares. In sharp contrast, during the financial year 2021 (FY21) a total of 76,555,000 new ordinary shares were issued following the conversion of a successful C Share issue and a further 73,374,900 shares were re-issued from treasury to meet strong demand for the Company's shares. Further significant new ordinary share issuance has taken place following the year end in response to continuing strong demand. These changes in share capital are described in more detail below.

As a result of the changes to share capital combined with strong investment performance, the NAV of the Company increased from £166m to £457m over the period under review.  The Board believes these capital changes have had the beneficial effect of enhancing liquidity in the shares and expanding the breadth and depth of our shareholder base.

Despite the extraordinary volatility in the Company's fortunes over the past two years, the Board has been able to maintain a steady dividend through the careful management of distributable reserves. The Board has announced a second interim dividend of 2.00p payable on 28 February 2022, maintaining the total dividend for the year at 4.40p for the second year running.

I am pleased to welcome to the Board Cecilia McAnulty who joined on 1 November 2021. Cecilia was appointed as phase one of the Board's succession plan, with the original Board members in place at the IPO retiring as their nine-year tenures expire. Cecilia has joined as Audit Chair-elect to ensure a smooth transition with the current Audit Chair, Joanne Elliot, who will step down from the Board following the forthcoming AGM in April 2022.

Performance

The sharp improvement in sentiment towards the financials sector in FY21 was evident in the performance of the Company's benchmark, the MSCI ACWI Financials Index, which delivered a total return in sterling terms of 27.0%, comfortably ahead of the MSCI ACWI Global index's 20.6% total return.

Your Manager was able to match this strong performance by delivering a total return of 27.9% after all expenses over the year. Since the reconstruction of the Company on 22 April 2020, the portfolio has generated a total return of 70.4% (net of expenses) compared to the benchmark's total return of 56.6%. The Manager was also able to successfully manage significant and regular capital inflows in a rising market, which can often be a drag on investment performance. In addition, the use of the C Share structure for a large portion of share issuance ensured that both performance and the revenue reserve were protected for our existing shareholders until the proceeds were fully deployed.

In FY21 the Manager's stock selection, previously a consistent source of added value, was for the first time a drag on performance relative to the benchmark. This was compensated by an overweight allocation to the strongly performing banks sub-sector, in particular US regional banks, and by the Manager's use of leverage in a rising market.  Other key features of the Manager's investment style included broad diversification across sectors and regions, including emerging markets, and a high active share of over 75% when positioning the portfolio against the benchmark. Drivers of performance are described in more detail in the Manager's Report.

Gearing is one of the tools that many investment trusts have at their disposal and the Manager deployed gearing during the year in order to enhance returns. The Board regularly reviews the borrowing arrangements that enable gearing and during the year switched providers to ensure the Company had the best available terms for both the revolving credit and term facilities.

Share Capital Changes - A Year of Extraordinary Growth

In April 2020 a Company reconstruction took place in the form of a 100% tender offer and the replacement of the fixed end-of-life with a five yearly tender offer. The tender resulted in the Company buying into treasury 79,159,235 ordinary shares, accounting for 39.1% of the shares in issue at that time. In addition to the tender the Company bought into treasury a further 670,000 ordinary shares in FY20 to support trading in the Company's shares, which traded for much of the year at a discount to NAV, reflecting the very negative sentiment towards the financials sector at that time.

The experience in FY21 could not provide a greater contrast. In my statement last year, I noted the positive change in sentiment towards the sector that followed the announcement of successful vaccination trials in November 2020. By the end of the same month, this resulted in the Company's share price trading at a premium to NAV and, on the very last day of the financial year, the first re-issue of shares out of treasury to satisfy investor demand.

During FY21 demand for the Company's shares remained consistently strong with its share price trading at a persistent premium to NAV. As I reported in my half year statement, the Board responded to the strong interest in the Company's shares by concluding a successful new issue of £122m C shares in June 2021, which were converted to 76,555,000 ordinary shares in August 2021. In addition, over the year, the Company re-issued a further 73,374,900 ordinary shares from its treasury account to satisfy persistent strong demand and to help facilitate orderly trading. Interestingly, the treasury shares were bought back in 2020 at an average price of 103.00p per share and re-issued during 2021 at an average price of 162.15p. Both exercises had the additional benefit of enhancing NAV per share for existing shareholders.

As a result, the number of ordinary shares in issue increased by 150m in aggregate from 123m ordinary shares at the beginning of the financial year to a total of 273m at the financial year end. The total cash raised during the financial year through the C share issue and treasury sales amounted to £239m. Coupled with the rise in the share price, the Company's market capitalisation rose by a remarkable 180% from £168m to £470m over the course of the financial year.

Ordinary shares remaining in treasury at the financial year end stood at 6.35m. Since then, demand for the Company's shares has continued to be strong, exhausting the remaining shares held in treasury within the first two weeks of the start of the 2022 financial year (FY22).

At the 2021 AGM the Company was given authority to issue 16.2m ordinary shares without pre-emption rights. By the end of January 2022, the remaining authority had reduced to 1m shares through issuance to satisfy demand; the Company was granted shareholder approval to renew the authority to issue shares on a non pre-emptive basis at a General Meeting on 1 February 2022 to provide additional flexibility to manage ongoing demand for shares. This authority, unless renewed earlier, will expire at the AGM to be held in April 2022, at which time a new authority to issue up to 10% of the enlarged share capital will be sought from shareholders.

Any shares sold into the market by the Company from either treasury or from its new issuance authority are only sold at a premium to the 'live' NAV calculated at the time of the transaction and are therefore accretive to NAV. In FY21, the cumulative effect of treasury share sales provided a 0.3617p uplift to NAV per share.

Apart from a brief period in the summer after the C shares were converted to ordinary shares, the Company's share price has consistently traded at a premium to NAV despite the extraordinary growth in shares in issue. The widest premium was 4.96% and at the end of the financial year the premium was calculated at 2.69%.

The rise in the number of shares in issue has not only brought critical mass to the Company and improved the liquidity of trading in its shares, it has also expanded and deepened our shareholder register. At the time of the tender in April 2020 the largest shareholder held 30% of the shares in issue. By 1 February 2022 the largest holding was 13% while a number of new investors were added to the list of shareholders. The Board is very appreciative of the support it has received from its longstanding shareholders and warmly welcomes its new shareholders.

The Board remains ready and willing to respond to any further demand for the Company's shares. The Directors have the ability, under the Prospectus issued on 12 May 2021, to undertake a second C share issue or subsequent placings of ordinary shares. The first such subsequent placing was undertaken at the end of January 2022 and resulted in the allotment of 16,869,893 ordinary shares for an aggregate value of £29.4m. The Directors believe that having the ability to ensure a ready supply of ordinary shares under the shareholder authorities, in any tranche size, should assist with reducing share price volatility by maintaining liquidity and satisfying demand in the market.

Dividends

In August 2021 the Company paid a first interim dividend of 2.4p per ordinary share. On 15 December 2021 the Company announced a second interim dividend of 2.0p per ordinary share, payable on 28 February 2022. The total dividend of 4.4p per ordinary share is unchanged from the total dividend paid in the previous financial year.

One of the advantages of the investment trust structure is the ability to support dividend payments through periods of volatility in underlying earnings. The COVID dominated environment of the past couple of years has certainly been such a period. Up to the 2019 financial year the Company was able to grow the dividend steadily by an average of 7.28% p.a. while building up revenue reserves. Since then, the portfolio's earnings have been adversely affected by the pandemic-induced recession. Despite this the Company has been able to maintain the level of dividend with the help of its distributable reserves.

Revenue earnings for the year ended November 2021 amounted to £8.4m. The higher number of shares ranking for the second interim dividend at the "ex" date will result in a total cash dividend paid for the year ended 30 November 2021 of £10m. On a per share basis the total dividend in respect of FY21 appears covered as the earnings per share is calculated based on the weighted average number of shares in the year.  However, on a cash basis, the dividend is paid on the number of shares in issue at the record date. Due to the significant share issuance throughout the financial year and up to the ex-dividend date, the number of shares ranking for the dividend is higher than the number of shares used for the earnings per share calculation and, as a result the dividend is not fully covered in cash terms and will partially be paid from distributable reserves.

The Company's Articles of Association allow the Company to make distributions from any of its distributable reserves, both capital and revenue. For the dividend relating to FY21, although there are sufficient revenue reserves to cover the shortfall mentioned above, the Board has chosen to make part of the distribution from capital reserves for reasons explained below.

Excluding the C share issue, between the beginning of FY21 and the second interim ex-dividend date on 6 January 2022, 82.1m new ordinary shares were issued or re-issued from treasury. Accounting convention requires that the proceeds from the issue of these shares are accounted for wholly as capital. However, the NAV at which they were issued to new holders in fact comprises both the capital value of the underlying portfolio and any accrued but undistributed earnings at the issue date and therefore comprises elements of both income and capital. When these new ordinary shares subsequently rank for a dividend, the dividend is accounted for wholly from revenue even though part of the dividend has effectively been "purchased" at the issue date and recorded in the capital account. The Board has therefore provided for this "purchased" part of the dividend, which can be accurately calculated, to be deducted from the special distributable reserve rather than revenue reserves. The Board believes this accounting approach captures the "purchased" income portion of the NAV, which was recorded as capital at the time of issue, and helps protect the revenue reserves built up historically from the impact of share issuance.

During FY21 and up to the ex-dividend date for the second interim dividend on 6 January 2022, income received into the Capital account from shares issued out of the Company's treasury account and through the shareholder authority amounted to £831,000. The Board has therefore decided to account for this amount in the second interim dividend through distributable capital reserves.

Looking forward, the Board expects the portfolio's underlying earnings to continue to recover as economies learn to live with COVID and the financial sector benefits from favourable tailwinds outlined in the Outlook below. The Board, together with the Manager, will continue to assess the likely income capability of the portfolio in a post-COVID environment to determine the appropriate longer-term distribution level.

Costs

Over the past two financial years the biggest drivers of movements in expenses as a percentage of NAV have been the significant changes in shares in issue, the growth in NAV from performance, and the Investment Manager's compensation including the performance fee accrual. Since the Company's reconstruction in April 2020 the performance fee is calculated as 10% of the excess performance over the total return of the benchmark plus a hurdle of 1.5% p.a. The fee is calculated on performance since the reconstruction and is accrued and only paid at the time of the five yearly tender. Due to the significant growth in the share capital during the year under review, the current calculation methodology presented an unintended outcome for the performance fee accrual. In order to address this, the Board worked with the Manager to amend the calculation to ensure that the performance fee accrual purely reflects investment performance as intended and is not distorted by share capital changes. This revised methodology has resulted in a reduction in the performance fee accrual in FY21.  Any performance fee accrual can be reduced by subsequent underperformance of the benchmark plus hurdle rate measured over the five year period. Note 18 below provides further detail.

At the time of the Company's reconstruction in 2020, the Manager agreed to a reduction in their base fee from 0.85% per annum of the lower of the Company's market capitalisation and NAV, to 0.70% per annum of the Company's NAV. This helped to mitigate the impact on the ongoing charges ratio ("OCR") of the significant decline in NAV and shares in issue following the reconstruction in that year. In FY20 the relatively low average NAV following the tender resulted in the OCR (excluding performance fees) rising to 1.09%. The substantial growth in the Company's NAV in FY21 has had a positive effect in reducing the OCR (excluding the performance fee) to 1.02%.  Including the performance fee accrual, the OCR has fallen from 1.74% to 0.98%, reflecting the reduced performance fee accrual in the year under review.

The Board continues to work with the Manager to ensure that any discretionary spending represents value for money for shareholders and the Board seeks to minimise ongoing expenses wherever possible.

Board Succession

The Company was launched in June 2013 with three Directors. A fourth Director, Simon Cordery, joined the Board in July 2019. The tenures of the three original Directors - Ms Elliot, Ms Hart and myself - are approaching the recommended maximum tenure of nine years, although the AIC Code allows companies with a formal policy to extend the period for the Chair to ease transition. In my statement last year I described the succession plan the Board had developed to provide refreshment in a managed way while being sensitive to appropriate diversity and experience mix. The plan was tabled to begin in 2021 and conclude in 2023 in order to ensure sufficient retention of Company knowledge at any one time and to avoid a cliff-edge of Director departures in the future.

As noted above, phase one of this plan was concluded with the appointment in November 2021 of Cecilia McAnulty as Audit Chair-elect to replace Joanne Elliot who will step down from the Board following the AGM in April 2022. Subsequent to this, the Board will move to the appointment of a new Director to replace Katrina Hart, to be completed by the end of 2022. At that point the Board will review its needs before completing the succession plan in 2023.

In advance of her retirement from the Board I would like to thank Joanne for her service. Joanne has been an excellent colleague and an outstanding Audit Chair, bringing her deep knowledge of the investment trust industry and her rigorous diligence to the role. As a member of the Board, Joanne has been our conscience, a constant and consistent advocate of shareholder interest and maximising shareholder value. Joanne takes with her the very best wishes of all who have shared the Polar Capital Global Financials Trust plc journey.

Environmental, Social and Governance (ESG)

The transition to Net Zero represents a seismic transformation for capital markets, bringing both unprecedented opportunities and threats. Providers of finance, including banks, are playing a critical role in achieving Net Zero goals. The Board welcomes the escalating expectations placed on the financial community to adopt more sustainable and inclusive behaviour and business practices. As well as delivering better outcomes for society as a whole, the Board believes that ESG factors will increasingly drive successful investment performance.

The Company outsources all its business operations and therefore has little direct control over any environmental and social deliverables. Instead, it works with and through its suppliers to better understand their ESG strategy. Specifically, during the course of the past year the Board has continued to engage with the Manager to monitor progress on their adoption of ESG principles in both their investment process and their corporate conduct; has included ESG factors in its risk map as standalone risks; and has engaged with third party suppliers on their Task Force on Climate-Related Financial Disclosures (TCFD). Further detail is provided in the Manager's Report and the ESG Report within the Annual Report.

The Board believes that this journey is only just beginning, driven by a deepening of society's expectations and regulation. The Board will continue to monitor and review its progress against these expectations and respond accordingly.

Outlook

The outlook for the year ahead at the time of writing would seem to be focused on two key drivers - inflation and COVID. The debate on inflation has - like that concerning the virus - centred on whether its upsurge can be characterised as elevated but transitory, or elongated and stubborn.

While the health battle is hopefully approaching its closing stages, the challenge facing central bankers to address rising inflation may only be beginning. As fiscal policy makers continue to focus on the cyclical and social fallout of the pandemic, there are early signs that central bankers are beginning to blink in their standoff with rising inflation. Among the 32 or so central banks that have already started to raise official rates, the Bank of England was the first of the major central banks to move rates higher.

The sharp pick up in non-wage inflation, unexpected supply disruptions in key markets and products, and the tightening of certain parts of the labour market do not seem to be a local story. The risk is that these pressures will be reflected in wage inflation, making the pick-up in general prices more severe and enduring. This is what many central bankers are now focusing on.

Importantly, the language from the Federal Reserve has clearly changed. Having been firmly in the 'transitory' camp on inflation, the Federal Reserve has removed this from its guidance and is now openly planning for a tapering in its asset purchases followed by a programme of official interest rate rises, and eventually moving to reduce the central bank's highly bloated balance sheet. The ECB, for the time being, is lagging but commentators expect its resistance to be tested by evidence of the effect of its policy stance on inflation, economic recovery and the Euro. In January 2022, Eurozone inflation rose to 5%, the highest level recorded over the more than 20-year life of the single currency, while the US reported 7%, representing a four-decade high.

Banks remain the largest component of the financials sector. Their strong performance in FY21 reflected their original conservatism in provisioning for pandemic related loan losses in relation to the resilience they demonstrated subsequently, and to their positive sensitivity to rising interest rate expectations. Since the global financial crisis in 2008, banks in general have been on a long path to rebuilding capital buffers, enhancing the quality of their balance sheets and improving their operational leverage.

In the near term COVID and the outlook for inflation and interest rates are likely to be  more significant drivers of fortunes for banks and the sector as a whole. Uncertainties over the pandemic and responses remain, although it appears that many governments and ways of life are moving towards a virus cohabitation rather than elimination reality. This would leave the door open to continued economic recovery with the accompanying inflation concerns.

It seems that we may be at an important turning point in the interest rate cycle and in the extraordinarily accommodative stance of the central banks that matter. The level of global interest rates and bond yields has arguably been at a disequilibrium low level for some time, reflecting the presence of humungous asset buyers at any price, prepared to expand central bank balance sheets without any limit. This has resulted in oceans of liquidity which has provided rocket fuel for financial asset markets, to the point where arguably risk has been systemically mispriced. It has also had collateral consequences such as the rise of crypto currencies which have been in part a response to the debasing of fiat currencies by central banks and which have taken on a life of their own as a beneficiary of limitless liquidity and the disequilibrium in the pricing of risk.

Defining an equilibrium level for interest rates is not straightforward. However, it is unlikely to be at a level where a number of key short-term rates and major longer bond yields are trading at negative or paltry levels; more so when evidence of rising inflation and tightness in key labour and product markets dominates headlines.

Traditionally banks receive more support from a steepening of the yield curve than from the absolute level of yields. This time many banks may be beneficiaries of a rise in rates all along the maturity range, whatever the impact on the shape of the yield curve. For quite some time banks have seen their capital buffers and profits challenged by low or negative short-term rates. Faced with the liquidity piling up on their books following central bank asset purchase programmes, and the paltry rates available on longer term lending/ investing which does not adequately reward risk, banks have had little option but to take the pain of short-term placements at penal rates. A rise in short term rates will feed straight into the bottom line of banks from the large liquidity pools on their balance sheets, while a rise in longer term yields will reward better their lending and investment risk taking. The leverage banks experience in a rising interest rate environment may never have been so rewarding as it is in the current cycle. This leverage is described in more detail in the Manager's Report.

Of course, the sector is more than banks, comprising insurance companies, diversified financials such as investment banks, asset managers and stock exchanges, as well as FinTech companies. Although not all are as sensitive to interest rates as the banking sector, they generally respond well to a recovering economic background.

A number of new players have also entered the market, typically in the FinTech sector, offering digitally-driven transaction services, brokerage platforms and custody services. Although carrying the risks inevitable in start-ups and young enterprises, they are helping to redefine banking products to the benefit of all participants.  Rather than being disrupters that threaten the traditional banks, FinTech companies are likely to see not only significant consolidation, but also their futures within or in partnership with the mainstream banks. The combination of digital solutions that meet the new expectations of customers at the core of FinTech offerings, coupled with the capital, client base, risk taking capacity and experience of traditional banks, will help power performance of the sector as a whole.

Overall, the sector is set to be one of the major beneficiaries of a return to normal, not just in the way of life but also in asset markets and prices.

Despite the generally constructive sentiment towards the sector, reports that as many as 75% of FinTech start-up ventures fail; the experience of Danske Bank with its Estonian subsidiary; Credit Suisse's missteps with Greensill Capital and Archegos; and the issues arising in Chinese property companies show the importance of stock picking. The Company benefits from a dedicated team of financials specialists who have extensive experience in the sector and a proven investment process. They are able to take advantage of the Company's flexibility to invest globally, including in emerging markets where they have particular knowledge, as well as to deploy leverage tactically. The Board believes that the Company is in a good position to translate the current favourable tailwinds for the sector into shareholder value.

The Board has always placed high value on engagement with shareholders. At times, such as around the reconstruction of the Company in April 2020, these contacts have brought significant benefits to the Board's stewardship of the Company.  Our AGM is scheduled for 7 April 2022 at the offices of Polar Capital in London, dependent on any COVID restrictions that may be in force at that time. The Board is very much looking forward to meeting shareholders in person once again.

Robert Kyprianou

Chairman

16 February 2022

Statement of Comprehensive Income

For the year ended 30 November 2021

The total return column of this statement represents the Company's Statement of Comprehensive Income, prepared in accordance with IFRS.

The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies.

The amounts dealt with in the Statement of Comprehensive Income are all derived from continuing activities.

The notes to follow form part of these financial statements.

Statement of Changes in Equity

For the year ended 30 November 2021

The notes to follow form part of these financial statements.

Balance Sheet

As at 30 November 2021

*The performance fee accrual for 2020 has been re-presented as a non-current liability from a previously presented current liability, see details in note 2 (e) below. 

The notes to follow form part of these financial statements.

Cash Flow Statement

For the year ended 30 November 2021

The notes to follow form part of these financial statements.

Notes to the Financial Statements

For the year ended 30 November 2021

1              General Information

Polar Capital Global Financial Trust plc is a public limited company registered in England and Wales whose shares are traded on

the London Stock Exchange.

The principal activity of the Company is that of an investment trust company within the meaning of Section 1158/1159 of the

Corporation Tax Act 2010 and its investment approach is detailed in the Strategic Report

The Board has determined that Sterling is the Company's functional currency and the presentational currency of the financial

statements because it is the currency which is most relevant to the majority of the Company's shareholders and creditors and

is the currency in which the majority of the Company's operating expenses are paid. All figures are rounded to the nearest

thousand pounds (£'000) except as otherwise stated.

2              Accounting Policies

The principal accounting policies, which have been applied consistently for all years presented, are set out below:

(a)   Basis of Preparation

The financial statements have been prepared in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards (IFRS) adopted pursuant to Regulation

(EC) No 1606/2002 as it applies in the European Union. See Director's Report in the Annual Report for further details.

The financial statements have been prepared on a going concern basis under the historical cost convention, as modified by the

revaluation of investments and derivative financial instruments at fair value through profit or loss.

Where presentational guidance set out in the Statement of Recommended Practice (SORP) for investment trusts issued by the Association of Investment Companies (AIC) in April 2021 is consistent with the requirements of IFRS, in so far as those requirements are applicable to the financial statements, the Directors have sought to prepare the financial statements on a basis

compliant with the recommendations of the SORP.

The financial position of the Company as at 30 November 2021 is shown in the balance sheet above. As at 30 November 2021 the Company's total assets exceeded its total liabilities by a multiple of over 9.6. The assets of the Company consist mainly of securities that are held in accordance with the Company's Investment Policy, as set out in the Annual Report and these securities are readily realisable. The Directors have considered a detailed assessment of the Company's ability to meets its liabilities as they fall due. The assessment took account of the Company's current financial position, its cash flows and its liquidity position. In addition to the assessment the Company carried out stress testing, including assessment of the continuing risks arising from COVID-19, which used a variety of falling parameters to demonstrate the effects on the Company's share price and net asset value. In light of the results of these tests, the Company's cash balances, and the liquidity position, the Directors consider that the Company has adequate financial resources to enable it to continue in operational existence for at least 12 months. Accordingly, the Directors believe that it is appropriate to continue to adopt the going concern basis in preparing the Company's financial statements.

(b)   Presentation of the Statement of Comprehensive Income

In order to better reflect the activities of an investment trust company and in accordance with the guidance set out by the AIC, supplementary information which analyses the Statement of Comprehensive Income between items of a revenue and capital nature has been presented alongside the Statement of Comprehensive Income. The result presented in the revenue return column is the measure the Directors believe appropriate in assessing the Company's compliance with certain requirements set out in Section 1158 of the Corporation Tax Act 2010.

(c)    Income

Dividends receivable from equity shares are taken to the revenue return column of the Statement of Comprehensive Income on

an ex-dividend basis.

Special dividends are recognised on an ex-dividend basis and may be considered to be either revenue or capital items. The facts

and circumstances are considered on a case-by-case basis before a conclusion on appropriate allocation is reached.

Where the Company has received dividends in the form of additional shares rather than in cash, the amount of the cash dividend foregone is recognised in the revenue return column of the Statement of Comprehensive Income. Any excess in value of shares received over the amount of cash dividend foregone is recognised in the capital return column of the Statement of Comprehensive Income.

The fixed returns on debt securities and non-equity shares are recognised under the effective interest rate method.

Bank interest is accounted for on an accrual basis. Interest outstanding at the year end is calculated on a time apportionment basis using market rates of interest.

(d)   Written Options

The Company may write exchange-traded options with a view to generating income. This involves writing short-dated covered call options and put options. The use of financial derivatives is governed by the Company's policies, as approved by the Board.

These options are recorded initially at fair value, based on the premium income received, and are then measured at subsequent reporting dates at fair value. Changes in the fair value of the options are recognised in the capital return for the year.

The option premiums are recognised evenly over the life of the option and shown in the revenue return, with an appropriate amount shown in the capital return to ensure the total return reflects the overall change in the fair value of the options.

Where an option is exercised, any balance of the premium is recognised immediately in the revenue return with a corresponding adjustment in the capital return based on the amount of the loss arising on exercise of the option.

(e)   Expenses and Finance Costs

All expenses, including the management fee, are accounted for on an accrual basis.

Expenses are allocated wholly to the revenue column of the Statement of Comprehensive Income except as follows:

Expenses are charged to the capital column of the Statement of Comprehensive Income where a connection with the maintenance or enhancement of the value of investments can be demonstrated. In this respect the investment management fees have been charged to the Statement of Comprehensive Income 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, 20% of the investment management fees are charged to the revenue account and 80% charged to the capital account of the Statement of Comprehensive Income.

Finance costs of the C shares issued by the Company, which were classified as a liability, are recognised as an expense in the capital column of the Statement of Comprehensive Income.

Finance costs, other than those relating to the C shares, are calculated using the effective interest rate method and are accounted for on an accruals basis and, in line with the management fee expense, are charged 20% to the revenue account and 80% to the capital account of the Statement of Comprehensive Income.

Any performance fee accrued is charged entirely to capital as the fee is based on the outperformance of the Benchmark and is

expected to be attributable largely, if not wholly, to capital performance. A provision will be recognised when outperformance

has been achieved in accordance with the calculations detailed in the Annual Report.

The presentation of the performance fee provision of £1,269,000 as at the year ended 30 November 2020 has been amended from a current liability to non-current liability to reflect the next payable date.

The research costs relate solely to specialist financial research and are accounted for on an accrual basis. They are allocated

20% to revenue and 80% to capital in line with the expected long-term split of revenue and capital return from the Company's

investment portfolio.

(f)    Taxation

The tax expense represents the sum of the overseas withholding tax deducted from investment income, tax currently payable and deferred tax.

The tax currently payable is based on the taxable profits for the year ended 30 November 2021. Taxable profit differs from net profit as reported in the Statement of Comprehensive Income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date.

In line with the recommendations of the SORP, the allocation method used to calculate tax relief on expenses presented against capital returns in the supplementary information in the Statement of Comprehensive Income is the "marginal basis". Under this basis, if taxable income is capable of being offset entirely by expenses presented in the revenue return column of the Statement of Comprehensive Income, then no tax relief is transferred to the capital return column.

Deferred tax is the tax expected to be payable or recoverable on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

Investment trusts which have approval as such under Section 1158 of the Corporation Tax Act 2010 are not liable for taxation on UK capital gains.

The company is liable to Indian capital gains tax under Section 115 AD of the Indian Income Tax Act 1961. The Indian capital gains tax provision represents an estimate of the amount of tax payable by the Company. Tax amounts payable may differ from this provision depending on when the Company disposes of its investments. The current provision for Indian capital gains tax is calculated based on the long term (securities held more than one year) or short term (securities held less than one year) nature of the investments and the applicable tax rate at the year end. Currently, the short-term tax rate is 15% and the long-term tax rate is 10%. The estimated tax charge is subject to regular review including a consideration of the likely period of ownership, tax rates and market valuation movements. The provision at the year end is recognised in the Balance Sheet and the year-on-year movement in the provision is recognised in the Statement of Comprehensive Income.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or when the asset is realised based on tax rates that have been enacted or substantively enacted at the balance sheet date.

Deferred tax is charged or credited in the Statement of Comprehensive Income, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

(g)   Investments Held at Fair Value Through Profit or Loss

When a purchase or sale is made under contract, the terms of which require delivery within the timeframe of the relevant market, the investments concerned are recognised or derecognised on the trade date and are initially measured at fair value.

On initial recognition the Company has designated all of its investments as held at fair value through profit or loss as defined by IFRS. All investments are measured at subsequent reporting dates at fair value, which is either the bid price or the last traded price, depending on the convention of the exchange on which the investment is quoted.

Written options are valued at fair value using quoted bid prices.

All investments, classified as fair value through profit or loss, are further categorised into the fair value hierarchy detailed below.

Changes in fair value of all investments and derivatives held at fair value and realised gains and losses on disposal are recognised in the capital return column of the Statement of Comprehensive Income.

In respect of unquoted investments, or where the market for a financial instrument is not active, fair value is established by using various valuation techniques, in accordance with the International Private Equity and Venture Capital ("IPEVC") Valuation Guidelines - Edition December 2018. These may include using reference to recent arm's length market transactions between knowledgeable, willing parties, if available, reference to recent rounds of re-financing undertaken by investee companies involving knowledgeable parties, reference to the current fair value of another instrument that is substantially the same or a relevant comparable.

(h)   Receivables

Receivables are initially recognised at fair value and subsequently measured at amortised cost. Receivables do not carry any interest and are short-term in nature and are accordingly stated at their nominal value (amortised cost) as reduced by appropriate allowances for estimated irrecoverable amounts.

(i)    Cash and Cash Equivalents

Cash comprises cash on hand and demand deposits. Cash equivalents are short-term, maturity of three months or less, highly liquid investments that are readily convertible to known amounts of cash.

(j)    Dividends Payable

Dividends payable to shareholders are recognised in the financial statements when they are paid, or in the case of final dividends, when they are approved by the shareholders.

(k)   Payables

Payables are not interest-bearing and are initially valued at fair value and subsequently stated at their nominal value

(amortised cost).

(l)    Bank Loans

Interest-bearing bank loans are initially recognised at cost, being the proceeds received net of direct issue costs, and subsequently at amortised cost. The amounts falling due for repayment within one year are included under current liabilities in

the Balance Sheet.

(m)  Foreign Currency Translation

Transactions in foreign currencies are translated into Sterling at the rate of exchange ruling on the date of each transaction.

Monetary assets, monetary liabilities and equity investments in foreign currencies at the balance sheet date are translated into

Sterling at the rates of exchange ruling on that date.

Realised profits or losses on exchange, together with differences arising on the translation of foreign currency assets or liabilities,

are taken to the capital return column of the Statement of Comprehensive Income.

Foreign exchange gains and losses arising on investments held at fair value are included within changes in fair value.

(n)   Share Capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are

shown in equity, as a deduction, net of tax, from the proceeds.

(o)   Capital Reserves

Capital reserve arising on investments sold includes:

-      gains/losses on disposal of investments;

-      exchange differences on currency balances; and

-      other capital charges and credits charged to this account in accordance with the accounting policies above.

Capital reserve arising on investments held includes:

-      increases and decreases in the valuation of investments held at the balance sheet date.

All of the above are accounted for in the Statement of Comprehensive Income.

(p)   Repurchase of Ordinary Shares (including those held in treasury)

Where applicable, the costs of repurchasing ordinary shares including related stamp duty and transaction costs are taken directly

to equity and reported through the Statement of Changes in Equity as a charge on the special distributable reserve. Share repurchase transactions are accounted for on a trade date basis.

The nominal value of ordinary share capital repurchased and cancelled is transferred out of called up share capital and into the capital redemption reserve.

Where shares are repurchased and held in treasury, the transfer to capital redemption reserve is made if and when such shares

are subsequently cancelled.

Where the shares held in treasury are reissued, the amount of the sales proceed up to the repurchased cost of those shares is transferred back into special distributable reserve, the excess of the sales proceeds over the repurchased cost is transferred to share premium.

(q)   Share Issue Costs

Where applicable, costs incurred directly in relation to the issue of new shares together with additional share listing costs have

been deducted from the share premium reserve.

(r) Accounting for C Shares

While the C Shares were in issue, the assets and liabilities attributable to the C Shares were accounted in a separate ring-fenced pool distinct from the net assets attributable to the Ordinary Shares. A proportion of the management fee, other administrative expenses and finance costs were also allocated to the C Share pool.

The C Shares issued represented contracts for conversion into a variable number of Ordinary Shares and therefore are classified as a liability of the Company. The income, expenses and capital gains and losses generated by the C Shares pool of assets during the period these shares were in existence, are included in the Statement of Comprehensive Income in their respective categories and the total is charged or credited back within finance costs in the capital column. The issue costs of the C shares are also recognised as a finance cost and charged to the capital column of the Statement of Comprehensive Income.

(s) Segmental Reporting

Under IFRS 8 Operating Segments, operating segments are considered to be the components of an entity about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The chief operating decision maker has been identified as the Investment Manager (with oversight from the Board).

The Directors are of the opinion that the Company has only one operating segment and as such no distinct segmental reporting is required.

(t) Critical Accounting Estimates and Judgements

The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. Estimates and assumptions used in preparing the financial statements are reviewed on an ongoing basis and are based on historical experience and various other factors that are believed to be reasonable under the circumstances. The results of these estimates and assumptions form the basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources.

The key judgements and sources of estimation uncertainty that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities and expenses in future periods are as follows:

Valuation of Level 3 Investments

Investments valued using valuation techniques include unlisted financial investments, which by their nature, do not have an externally quoted price based on regular trades.

The valuation techniques used may include the techniques described in note 2(g). When determining the inputs into the valuation techniques used, priority is given to publicly available prices from independent sources when available, but overall the source of pricing is chosen with the objective of arriving at a fair value measurement that reflects the price at which an orderly transaction would take place between market participants at the balance sheet date.

(u) New and revised accounting Standards

There were no new IFRSs or amendments to IFRSs applicable to the current year which had any significant impact on the Company's financial statements.

i) The following new or amended standards became effective for the current annual reporting period and the adoption of the standards and interpretations has not had a material impact on the financial statements of the Company:

ii) At the date of authorisation of the Company's financial statements, the following new or amended IFRSs that potentially impact the Company are in issue but are not yet effective and have not been applied in the financial statements:

The Directors expect that the adoption of the standards listed above will have either no impact or that any impact will not be material on the financial statements of the Company in future periods.

3     Investment Income

Included within income from investments is £502,000 (2020: £250,000) of special dividends classified as revenue in nature in accordance with note 2 (c). No special dividends have been recognised in capital (2020: nil).

4     Other Operating Income

5     Gains/(Losses) on Investments Held at Fair Value

6     Other Currency Losses              

7     Investment Management and Performance Fee

8     Other Administrative Expenses (including VAT where appropriate)

1    Full disclosure is given in the Directors' Remuneration Report in the Annual Report.

2    In May 2021, PwC were appointed as Reporting Accountant to the Company in connection with the issue of the Prospectus in relation to the C Share Issuance programme, such service was

deemed to be a non-audit service for which a fee of £50,000 was paid. The amount has been charged to capital reserves as defined under IAS 32.

3    Fees are determined on the pre-approved rate card with HSBC. Includes additional costs in relation to C shares.

4    Fee is based on the value of the assets and geographical activity and determined on the pre-approved rate card with HSBC. The size of the assets and level of activity have both increased following the

 issue of C share and re-issue of shares from treasury during the year.

5    2021 includes legal cost associated to disapply pre-emption rights of ordinary shares held in treasury and RBS credit facility legal fee.

6    Includes marketing bespoke expenses payable to Polar Capital LLP of £54,000 (2020: £27,000).

7    Research costs (which applied from 3 January 2018) payable by the Company relate solely to specialist financial research. The estimated spend for the year under review was US $20,000

(£15,000) (2020: US $20,000 (£14,000)), the cost of general non-specialist research and any amounts exceeding the agreed cap are absorbed by Polar Capital. Any adjustments to the prior

year's budget versus actual spend is included in the current period. These costs are allocated 20% to revenue and 80% to capital and are included in the ongoing charges calculation.

8    2021 includes a non-executive Director search cost.

Ongoing charges represents the total expenses of the Company, excluding finance costs and tax, expressed as a percentage of the average daily net asset value, in accordance with AIC guidance issued in May 2012.

The ongoing charges ratio for the year ended 30 November 2021 was 1.02% (2020: 1.09%). The ongoing charges ratio including the performance fee accrued was 0.98% (2020: 1.74%).  See Alternative Performance Measures below.  

9     Finance Costs

Finance costs are allocated 20% to revenue and 80% to capital with the exception of the costs related to C shares charged 100% to capital.

10   Taxation        

a) Analysis of tax charge/(credit) for the year:

b) Factors affecting tax charge/(credit) for the year:

c) Factors that may affect future tax charges:              

The Company has an unrecognised deferred tax asset of £1,345,000 (2020: £605,000). The deferred tax asset is based on a prospective corporation tax rate of 25% (2020: 19%). The Finance Act 2021 received Royal Assent on 10 June 2021 and the rate of Corporation Tax of 25% effective from 1 April 2023 has been used to calculate the potential deferred tax asset.

It is unlikely that the Company will generate sufficient taxable profits in the future to utilise these expenses and deficits and therefore no deferred tax asset has been recognised.

Due to the Company's tax status as an investment trust and the intention to continue meeting the conditions required to obtain approval of such status in the foreseeable future, the Company has not provided UK tax on any capital gains arising on the revaluation or disposal of investments held by the Company.

The Company is liable to Indian capital gains tax under Section 115 AD of the Indian Income Tax Act 1961. A tax provision on Indian capital gains is calculated based on the long term (securities held more than one year) or short term (securities held less than one year) nature of the investments and the applicable tax rate at the year end. The current rates of short-term tax rates are 15% and the long term tax rates are 10% respectively.  At the year ended 30 November 2021, the Company has a deferred tax liability of £556,000 (2020: £nil) on capital gains which may arise if Indian investments are sold.

11   Earnings/(Losses) Per Ordinary Share    

As at 30 November 2021 there were no potentially dilutive shares in issue (2020: nil).

12   Amounts Recognised as Distributions to Ordinary Shareholders in the Year

        Dividends paid in the year ended 30 November 2021

The revenue available for distribution by way of dividend for the year is £8,365,000 (2020: £4,654,000).

The total dividends payable in respect of the financial year ended 30 November 2021, which is the basis on which the requirements of section 1158 Corporation Tax Act 2010 are considered, are set out below:

The total dividends payable in respect of the financial year ended 30 November 2020, which is the basis on which the requirements of section 1158 Corporation Tax Act 2010 are considered, are set out below:          

All dividends are paid as interim dividends, and all have been charged to revenue, where necessary utilising the revenue reserves, with the exception of the interim dividend payable on 28 February 2022. Part of this dividend, amounting to £831,000 is to be paid out of the special distributable reserve. See Chairman's Statement above and Report of the Directors in the Annual Report for further details.

13   Investments Held at Fair Value Through Profit or Loss

a) Investments held at fair value through profit or loss

The Company received £216,527,000 (2020: £187,901,000) from disposal of investments in the year. The book cost of these investments when they were purchased were £183,634,000 (2020: £197,210,000). These investments have been revalued over time and until they were sold any unrealised gains/losses were included in the fair value of the investments.

The following transaction costs, including stamp duty and broker commissions, were incurred during the year:

b) Changes in Derivative Financial Instruments

* The contract for difference was utilised during the year for the purpose of efficient portfolio management. There was no contract for difference held at year ended 30 November 2021 (2020: £nil).

c) Fair value hierarchy        

The Company's financial instruments within the scope of IFRS 7 that are held at fair value comprise its investment portfolio and derivative financial instruments.

They are categorised into a hierarchy consisting of the following three levels:

Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to 'the fair value measurement of the relevant asset'.

Details of the valuation techniques used by the Company are given in note 2(g) above.

The following tables set out the fair value measurements using the IFRS 7 hierarchy at 30 November 2021 and 2020:

The Level 3 investment relates to the shares in Atom Bank.

There have been no transfers during the year between Levels 1 and 2. A reconciliation of fair value measurements in Level 3 is set out below.

Level 3 Investments are recognised at fair value through profit or loss on a recurring basis.

Level 3 investments are valued in accordance with the accounting policy in Note 2(g)above. The valuation of the investment in Atom Bank was arrived at taking into account the operating performance of the bank and comparing its valuation to that of listed UK bank peers. As a result, the valuation was reduced by 21%.

A +/- 10% change in the price used to value the investment in Atom Bank as at the year end would result in a +/- £192,000

(2020: £212,000) impact on the gains or losses on investments held at fair value in the Statement of Comprehensive Income.

d)    Unquoted investments             

The value of the unquoted investments as at 30 November 2021 was £1,921,000 (2020: £2,120,000) and the portfolio comprised the following holdings:

At 30 November 2021, the Company owned 0.64% (2020: 0.64%) of Atom Bank's issued share capital. Atom Bank was

granted a full banking licence on 4 April 2016 and started to accept savings and loan business from this date.

At 31 March 2021 (Atom Bank's financial year end), Atom Bank announced that it had made pre-tax losses of £62,379,000

(2020: £63,945,000) and had net assets attributable to shareholders of £141,330,000 (2020: £200,503,000).

The valuation of Atom Bank was reviewed by the Investment Manager and the Board during both the half year and full year

financial results process. At the half year end, the investment of Atom Bank was written down to the price at which the bank raised £40m of capital.

14   Cash and Cash Equivalents        

15   Called Up Share Capital             

This reserve is not distributable.

During the year, there were no ordinary shares repurchased into treasury (2020: total of 79,829,235 ordinary shares were repurchased into treasury for a total consideration of £81,423,000 plus expenses of £807,000, of which £10,000 relates to nonaudit services, as defined under IAS 32). A total of 73,374,900 (2020: 104,335) ordinary shares were issued out of treasury for a total consideration of £117,187,000 (2020: £142,000).

The Company also issued 122,000,000 C shares for gross proceeds of £122,000,000. On admission, the C shareholders held

rights over a ring-fenced portfolio attributable to the C shares and this portfolio was invested in accordance with the Company's

Investment Policy. These were duly converted into 76,555,000 ordinary shares on 13 August 2021, based on a conversion

ratio as calculated in accordance with the terms and conditions of the Company's Articles which was approved at the General

Meeting on 16 June 2021 and as summarised in the Prospectus.

Subsequent to the year end to 16 December 2021, the Company has issued a further 6,350,000 shares out of treasury for a

total consideration of £10,981,000, leaving no shares held in treasury. The Company undertook first placing under the Prospectus issued on 12 May 2021 at the end of January 2022 and resulted in the allotment of 16,869,893 ordinary shares for a total consideration of £29,406,000. Since the financial year end and up to 16 February 2022, a total of 22,600,107 new ordinary shares have been issued from the block listing facility for a total consideration of £40,111,314. As at the same date, there remain 21,997,893 ordinary shares available for issue from the Company's blocklisting.

The ordinary shares held in treasury have no voting rights and are not entitled to dividends.

16   Net Asset Value Per Ordinary Share      

As at 30 November 2021, there were no potentially dilutive shares in issue (2020: nil).

17   Transactions with the Investment Manager and Related Party Transactions

a) Transactions with the manager   

Under the terms of an agreement dated 11 June 2013 the Company has appointed Polar Capital LLP ("Polar Capital") to provide investment management, accounting, secretarial and administrative services. Details of the fee arrangement for these services are given in the Strategic Report within the Annual Report. The total fees, paid under this agreement to Polar Capital in respect of the year ended 30 November 2021 were £2,244,000 (2020: £1,494,000) of which £272,000 (2020: £179,000) was outstanding at the year end.

A performance fee based on cumulative relative performance since 23 April 2020, amounting to £1,164,000 (2020: £1,269,000) has been accrued at the year end, of which £105,000 (2020: £1,269,000) was written back in the current year. The whole of this amount was outstanding at the year end. Any accrued performance fee is payable at the end of each five-year tender period, the next being in 2025. See Strategic Report within the Annual Report for more details.

In addition, the total research costs in respect of the period from 1 January 2021 to the year ended 30 November 2021 were £13,000 (2020: £14,000) of which £7,000 (2020 : £7,000) was outstanding at the year-end.

b) Related party transactions           

The Company has no employees and therefore no key management personnel other than the Directors. The Company

paid £124,000 (2020: £122,000) to the Directors of which £33,000 (2020: £79,000) was outstanding at the year end and the Remuneration Report is provided in the Annual Report. When dividends are paid by the Company these are received by the Directors at the same rates and terms as by all other shareholders.

18.          Post Balance Sheet Events

Subsequent to the year end, there has been one event that affects the financial statements. This relates to the revised performance fee calculation.  The fee is calculated on performance since the reconstruction and is accrued and only paid at the time of the five yearly tender. Due to the significant growth in the share capital during the year under review, the current calculation methodology presented an unintended outcome for the performance fee accrual. In order to address this, the Board worked with the Manager to amend the calculation to ensure that the performance fee accrual purely reflects investment performance as intended and is not distorted by share capital changes. Consequently, the performance fee accrual was reduced from £1,948,000 under the old methodology to £1,164,000 as at the year ended 30 November 2021. Any performance fee accrual can be reduced by subsequent underperformance of the benchmark plus hurdle rate measured over the five year period.

Subsequent to the year end, the remaining 6,350,000 ordinary shares were issued from treasury and a total of 22,600,107 new ordinary shares were issued from the block listing facility. The Company undertook the first subsequent placing under the Prospectus issued on 12 May 2021 at the end of January 2022 which resulted in the allotment of 16,869,893 ordinary shares. Following these share issues, the total number of ordinary shares in issue was 318,800,000 and the number of shares held in treasury was nil.

There are no other significant events that have occurred after the end of the reporting period to the date of this report which

require disclosure.

Alternative Performance Measures (APMs)

In assessing the performance of the Company, the Investment Manager and the Directors use the following APMs which are not defined in accounting standards or law but are considered to be known industry metrics:

Net Asset Value (NAV)

The NAV is the value attributed to the underlying assets of the Company less the liabilities, presented either on a per share or

total basis.

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. See Note 16 above for detailed calculations. The NAV per ordinary share is published daily.

NAV Total Return (APM)

The NAV total return shows how the net asset value per share has performed over a period of time taking into account both

capital returns and dividends paid to shareholders. The NAV total return performance for the period is calculated by reinvesting

the dividends in the assets of the Company from the relevant ex-dividend date.

NAV Total Return Since Inception (APM)

NAV total return since inception is calculated as the change in NAV from the initial NAV of 98p, assuming that dividends paid to shareholders are reinvested on the ex-dividend date in ordinary shares at their net asset value.

NAV Total Return Since Reconstruction (APM)

NAV total return since reconstruction is calculated as the change in NAV from the NAV of 102.8p, which was the closing NAV the night before the tender offer on 22 April 2020, assuming that dividends paid to shareholders are reinvested on the ex-dividend date in ordinary shares at their net asset value.

Share Price Total Return (APM)

Share price total return shows how the share price has performed over a period of time. It assumes that dividends paid to shareholders are reinvested in the shares at the time the shares are quoted ex-dividend.

Share Price Total Return Since Inception (APM)

Share price total return since inception is calculated as the change in share price from the launch price of 100p, assuming that dividends paid to shareholders are reinvested on the ex-dividend date.

Share Price Total Return Including Subscription Share Value (APM)

The share price total return including subscription share value performance since inception includes the value of the subscription shares issued free of payment at launch on the basis of one-for-five ordinary shares and assumes such were held throughout the period from launch to the conversion date of 31 July 2017. Performance is calculated by reinvesting the dividends in the shares of the Company from the relevant ex-dividend date and uses the launch price of 100p per ordinary share.

Premium/(Discount) (APM)

A description of the difference between the share price and the net asset value per share usually expressed as a percentage (%) of the net asset value per share. If the share price is higher than the NAV per share the result is a premium. If the share price is lower than the NAV per share, the shares are trading at a discount.

Ongoing Charges (APM)

Ongoing charges are calculated in accordance with AIC guidance by taking the Company's annual ongoing charges, excluding performance fees and exceptional items, if any, and expressing them as a percentage of the average daily net asset value of the Company over the year.

Ongoing charges include all regular operating expenses of the Company. Transaction costs, interest payments, tax and nonrecurring expenses are excluded from the calculation as are the costs incurred in relation to share issues and share buybacks.

Where a performance fee is paid or is payable, a second ongoing charge is provided, calculated on the same basis as the above but incorporating the movement in the performance fee provision.

Net Gearing (APM)

Gearing is calculated in line with AIC guidelines and represents net gearing. This is defined as total assets less cash and cash equivalents divided by net assets. The total assets are calculated by adding back the bank loan. Cash and cash equivalents are cash and purchases and sales for future settlement outstanding at the year end.

AGM 

The Annual Report and separate Notice of Annual General Meeting will be posted to Shareholders in March 2021 and will be available from the Company Secretary at the Company's Registered Office, (16 Palace Street London SW1E 5JD) and on the Company's website. The AGM will be held at the Company's Registered Office at 9.30am on 7 April 2022. Unless any Government restrictions are put in place ahead of such date in connection with COVID-19, the meeting will be conducted in person.

Forward Looking Statements

Certain statements included above contain forward-looking information concerning the Company's strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the countries, sectors or markets in which the Company operates. By their nature, forward-looking statements involve uncertainty because they depend on future circumstances, and relate to events, not all of which are within the Company's control or can be predicted by the Company. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Actual results could differ materially from those set out in the forward-looking statements. For a detailed analysis of the factors that may affect our business, financial performance or results of operations, we urge you to look at the principal risks and uncertainties included in the Strategic Report Section of the Annual Report and Financial Statements.

No part of these preliminary results constitutes, or shall be taken to constitute, an invitation or inducement to invest in Polar Capital Global Financials Trust plc or any other entity and must not be relied upon in any way in connection with any investment decision. The Company undertakes no obligation to update any forward-looking statements. 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.