AMENDMENT Please note that the announcement released at 07:00hrs this morning (RNS No: 1912V) included a typographical error in the Key Performance Indicators table. The headers in the table were both labelled as 30 September 2024 rather than 30 September 2024 and 30 September 2023 respectively.  The announcement has been updated below.  All other information remains unchanged.

 

 

Patria Private Equity Trust plc

Legal Entity Identifier (LEI): 2138004MK7VPTZ99EV13

 

ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2024

 

Patria Private Equity Trust plc ('PPET') is an investment trust with a premium listing on the London Stock Exchange.

 

PPET partners with 15 carefully selected private equity managers, investing both in their funds and directly alongside them into private companies. This provides PPET's investors with a diversified underlying portfolio of more than 600 private companies, mainly headquartered in Europe. This approach has resulted in consistent, long-term net asset value ('NAV') growth, with an annualized NAV total return of 14.8% over the last decade.

 

Patria Capital Partners LLP, a wholly owned subsidiary of Patria Investments Limited, is PPET's alternative investment fund manager ('AIFM', the 'Investment Manager' or the 'Manager').

 

KEY PERFORMANCE INDICATORS

 

	As at	As at
	30 September	30 September
	2024	2023
Share Price Total Return*	24.9%	11.7%
Net Asset Value Total Return*	2.4%	5.4%
Gearing*	11.8%	8.6%
Over-commitment Ratio*	28.5%	35.2%

* Considered to be an alternative performance measure. 

OTHER FINANCIAL HIGHLIGHTS

	As at	As at	As at
	30 September	30 September	30 September
	2024	2023	2022
NAV per share*	780.1p	777.7p	753.2p
Portfolio Return (in Local Currency)	8.8%	9.4%	10.5%
Total Dividend Per Share	16.8p	16.0p	14.4p
Share Price Discount to NAV*	31.4%	43.2%	45.6%
Net Assets	£1,192.1m	£1,195.6m	£1,158.1m
Ongoing Charges Ratio (OCR) *	1.06%	1.06%	1.06%

* Considered to be an alternative performance measure

HIGHLIGHTS TO 30 SEPTEMBER 2024

 

·	NAV Performance - NAV Total Return for the 12 months to 30 September 2024 was 2.4%.
·	Portfolio Return in Local Currency - The underlying portfolio returned 8.8% during the year in local currency.
·	Cash flows - Realisations of £292.3 million and drawdowns of £163.7 million during the year.
·	New Investments - PPET made 17 investments totalling £195.8 million during the year.
·	Secondary Sale - PPET agreed to sell a portfolio of 14 fund positions at a 5% discount to 31 March 2024 valuations (transaction reference date) during the year.
·	Direct Investments - The direct investment portfolio consists of 32 underlying companies and equates to 25.7% of NAV.
·	Outstanding Commitments - Outstanding commitments at the year-end amounted to £652.7 million and the overcommitment ratio was 28.5% at year-end.
·	Balance Sheet and Liquidity - At the year-end, PPET had £317.8 million of short-term resources (cash, undrawn credit facility and deferred consideration from secondary sales).
·	Summary of the Year - The acquisition of PPET's Manager by Patria has brought renewed energy and certainty to PPET's investment management team but importantly will not result in any change in PPET's investment strategy.

 

TEN YEAR FINANCIAL RECORD

 

	2015	2016	2017	2018	2019	2020	2021	2022	2023	2024
Per share data
NAV (diluted) (p)	281.6	346.4	389.6	430.2	461.9	501.0	673.8	753.2	777.7	780.1
Share price (p)	214.0	267.3	341.5	345.5	352.0	320.0	498.0	410.0	442.0	535.0
Discount to diluted NAV per Share (%)*	(24.0)	(22.8)	(12.3)	(19.7)	(23.8)	(36.1)	(26.1)	(45.6)	(43.2)	(31.4)
Dividend per Share (p)	5.25	5.4	12.0	12.4	12.8	13.2	13.6	14.4	16.0	16.8
Ongoing charges ratio*1,3	0.98	0.99	1.142	1.10	1.09	1.10	1.10	1.06	1.06	1.06
Returns data
NAV Total Return*(%)	11.9	24.8	14.9	13.3	10.5	11.7	37.9	14.1	5.4	2.4
Share Price Total Return*(%)	(4.0)	27.9	31.9	5.8	5.7	(4.6)	60.6	(15.1)	11.7	24.9
Portfolio data
Net Assets (£m)	438.7	532.6	599.0	661.4	710.1	770.3	1,036.0	1,158.1	1,195.6	1,192.1
Top 10 Managers as a % of net assets3	65.2	65.0	58.9	63.6	67.9	67.8	62.9	65.1	64.3	62.7
Top 10 investments as a % net assets	48.6	45.9	47.7	48.4	53.9	48.3	40.3	35.6	29.9	25.1
Source: The Manager & Refinitiv
1 For further information on the calculation of the ongoing charges ratio of the Company, please refer to the alternative performance measures. 2The incentive fee arrangement ended on 30 September 2016. Following the end of the incentive fee period, a single management fee of 0.95% per annum of the NAV of the Company replaced the previous management and incentive fees.  3 The ongoing charges ratio was labelled as expense ratio in the Annual Report to 30 September 2023. * Considered to be an alternative performance measure.

 

CHAIR'S STATEMENT

 

"A year of positive transaction for PPET".

 

Introduction

I am pleased to report that PPET continues to perform despite the broader challenges. The Share Price and NAV Total Return for the year to 30 September 2024 delivered 24.9% and 2.4% respectively.

 

The last 12 months have been a year of transition since our Manager had a change in ownership and, as a result, the Board rebranded the Company to Patria Private Equity Trust plc. At the same time, we appointed a new corporate broker, launched a share buyback programme and conducted a successful secondary sale of a non-core portfolio of fund investments.

 

From a wider investment trust perspective, there have been positive developments around cost disclosures, which has the potential to benefit private equity investment trusts like PPET.

 

Private equity investment activity is showing more positive momentum after a tough 2023 and that should benefit the Company as we look ahead to 2025.

 

New Name

As I explained in the Interim Report, the Board spent a great deal of time during the first half of the year undertaking due diligence on the Manager's change of ownership, from abrdn plc ('abrdn') to Patria Investments ('Patria'). The Board announced our consent to the Manager change of control at the AGM in March 2024 and the sale of the Manager completed at the end of April 2024. The Company changed its name from abrdn Private Equity Opportunities Trust plc to Patria Private Equity Trust plc on 29 April 2024.

 

The Board and I are pleased with how the Manager has settled into Patria during the second half of the year and we are encouraged by the engagement from Patria's senior leadership. Patria has so far delivered on their promises and I would particularly highlight that they have invested behind the Manager's team, with 15 new hires since the deal with abrdn was announced in October 2023. They also committed additional money to help promote PPET through marketing initiatives, following its name change. The Manager's senior team has been stable for a number of years, with no departures following the Patria move, and PPET's investment strategy remains unchanged.

 

There has been no change to PPET's service providers as a result of the change of the Manager. However, unrelated to the Manager's change of ownership, the Board initiated a change of broker during the year and appointed Investec Bank plc as sole corporate broker with effect from 5 July 2024.

 

Investment strategy

The Board and the Manager are aligned on our vision for PPET's investment strategy and the change of ownership hasn't materially impacted upon this. PPET remains focused on the mid-market buyout segment of private equity (private companies between €100 million and €1 billion enterprise value at entry) and principally in Europe.

 

Whilst the broad focus on the private equity mid-market remains unchanged, we want to further increase our exposure to the lower end of the mid-market: companies between €100 million and €500 million enterprise value at entry. Our belief is that the lower mid-market is the most attractive part of the private equity market from a risk-adjusted viewpoint, given companies in this segment are typically established, profitable and cash generative but with clear avenues and strong potential for further growth. We believe this part of the market has the potential to outperform other segments of private equity, particularly in an environment where interest rates will be higher for longer.

 

PPET will continue to make fund investments, both on a primary and secondary basis, but direct investments into private companies will continue to increase as a proportion of the portfolio. Directs bring the key advantage of reducing the underlying costs of PPET (compared to funds), given most of PPET's direct portfolio doesn't attract fees or carried interest at an underlying level. Therefore, we believe building a diversified portfolio of direct investments will bring the potential for higher returns on a net basis and, so far, PPET's portfolio of 32 direct investments is performing in line with that expectation.

 

I would note that PPET has not deployed as much in fund secondaries as we would have liked in recent years and that fund secondaries equate to 9.0% of PPET's portfolio value at 30 September 2024. To help PPET deploy more in this area, the Board agreed to PPET making a commitment to Patria Secondary Opportunities Fund V ('SOF V'), a vehicle run by an affiliate of the Manager. As part of this fund commitment, I would note that the investment will be excluded from NAV when considering the calculation of the Manager's fee and that PPET obtained attractive underlying terms as a cornerstone investor.

 

Lastly, given Patria is headquartered in Brazil and has been making private markets investments in Latin America for over three decades, we are often asked whether this means PPET will start investing in that geographic region. I can confirm there are no plans for that and the Company's geographic focus will remain largely on Europe.

 

Performance

I am pleased with the share price total return performance of 24.9% this year (30 September 2023: 11.7%) and, whilst the NAV Total Return of 2.4% (30 September 2023: 5.4%) is lower than PPET's longer-term average, much of this is due to foreign exchange ('FX') headwinds since the portfolio return in local currency was 8.8% (30 September 2023: 9.4%).

 

The underlying health of PPET's portfolio is sound, as the Manager has outlined in the Investment Manager's Review. However, I would call out the top 100 companies, which equate to around 63.9% of portfolio value, growing revenue by 12.4% and EBITDA by 18.1% on average in the year to 30 September 2024. I would also highlight that increased market activity in the private equity sector appears to be feeding through to an increased level of exits and cash distributions to PPET. Exits in PPET's portfolio during the 12 months resulted in an average uplift of 26%, when compared to the unrealised valuation two quarters prior to exit.

 

PPET's balance sheet remains strong with £28.4 million of cash and £159.4 million remaining undrawn on PPET's revolving credit facility ('RCF') at 30 September 2024.  This will be supplemented by approximately £157.2 million of deferred proceeds from PPET's secondary sale of a portfolio of 14 fund investments, which completed on 30 September 2024.

 

Furthermore, subsequent to the year-end, the Board announced an extension of PPET's RCF which takes effect on 3 February 2025.  The RCF has been extended by three years and the amount available increased from £300.0 million to £400.0 million with Banco Santander, SA and State Street Bank & Trust Company joining the syndicate of banks as new lenders alongside current providers The Royal Bank of Scotland International Limited (London Branch), Société Générale, London Branch and State Street Bank International GMBH.  NatWest Markets plc continues to act as facility agent and will now also act as security agent to the syndicate of banks.

 

In summary, I am pleased with performance during the year, within a challenging market context. The Manager has provided more detailed information on performance and the portfolio in the Investment Manager's Review.

 

Share price discount to NAV

PPET's share price discount to NAV at 30 September 2024 was 31.4% (30 September 2023: 43.2%) and compares to 35.1% of the weighted average of PPET's close peer group. Whilst the Board is pleased with the narrowing of the discount during the year, we continue to believe PPET's discount is too wide and remain focused on initiatives to help narrow it even further.

 

The Board announced a share buyback programme in January 2024. During the year to 30 September 2024, PPET had bought back 940,128 of its Ordinary Shares into treasury, equating to an aggregate investment of £4.9 million. The programme, which is being funded by a portion of the proceeds from the partial sale of PPET's direct investment in Action, was instigated by the Board to take advantage of PPET's share price discount and provide a compelling investment for PPET shareholders. The buyback programme has also had the added impact of contributing to the short-term demand for PPET shares and consequently helping to drive share price performance during the period, adding 1.6 pence per share to our NAV. Since 30 September 2024, the Company has bought back a further 1,240,000 shares.

 

Going forward, the Board will continue to monitor the programme closely and the evolution of PPET's share price. We are certainly not content with the current rating, despite it currently being narrower than similar private equity investment trusts, and will continue to assess ways to generate buy-side demand for PPET's shares and create value for existing shareholders.

 

Cost disclosure developments

The Board welcomes the FCA forbearance and an updated Key Information Document has been published by the Manager to reflect a more accurate assessment of costs to shareholders associated with an investment in PPET. As reported in the Half Yearly Report, the Board believes that PPET was penalised by the previous cost disclosure regulations. Including costs embedded in our underlying investee funds in the overall PPET costs is misleading to investors. We are pleased that the FCA forbearance was granted and await the final rules from the UK Government. The Board was also pleased that, following engagement with Fidelity, PPET can now be traded on Fidelity's platforms.

 

Dividend policy

PPET has grown its annual dividend for ten consecutive years and since 2016 has paid shareholders an enhanced dividend on a quarterly basis, which is effectively an ongoing return of capital to shareholders at NAV. The Board intends to continue this policy going forward, with the aim of maintaining the value of the dividend in real terms.

 

For the year to 30 September 2024, PPET has paid four interim dividends of 4.2 pence per share. The fourth interim dividend was paid on 24 January 2025 to shareholders on the register on 13 December 2024 resulting in a total dividend for the year of 16.8 pence per share. This represents an increase of 5.0% on the 16.0 pence per share paid for the year to 30 September 2023.

 

New Investments and Proposed Amendments to PPET's Investment Objective and Policy

PPET continues to be active in deploying into new investment opportunities through the cycle, having made six new fund investments, two fund secondaries and nine direct investments during the year. Our Manager is focused on making investments in the midmarket buyout space and partnering with private equity managers that are truly market-leading and differentiated, usually via specific sector expertise and proven ability to add value in their portfolio companies.

 

In particular, I am encouraged by the growth in the direct investment portfolio, which now stands at 32 companies, equates to around 26% of PPET's portfolio value, and is performing strongly. As a reminder, direct investments were brought into PPET's investment objective and policy in 2019. We aim to continue PPET's growth in direct investments and with this in mind are therefore seeking shareholder approval at the AGM to amend the Company's investment objective and policy to, amongst other things:

 

·	change the expected portfolio allocation to co-investments from a maximum of 25% of the Company's assets to an expected range for direct investments (meaning co-investments and single asset secondaries) of 20-35% of the total value of investments (and linked with this, specify that the portfolio allocation to fund investments is expected to be around 65-80% of the total value of investments);
·	clarify that no single fund investment or direct investment may exceed 15% of the Company's total value of investment at the time of investment;
·	reduce the Company's over-commitment ratio (being the ratio by which the Company can make commitments in excess of its uninvested capital) from a range of 30-75% over the long-term to 30-65% over the long-term; and
·	make it clear that the principal focus of the Company's investment strategy is the European mid-market.

 

The full text of the proposed investment objective and policy for the Company is set out below. A version showing the changes versus the current investment objective and policy is shown in the Annual Report.

 

Secondary sale

In September 2024, PPET agreed the sale of a portfolio of 14 underlying fund investments which resulted in deferred proceeds of approximately £157.2m and achieved a pricing of 95% on 31 March 2024 valuations, being the transaction reference date. The Manager's Review outlines the transaction in more detail; however, I would highlight that this was a portfolio of funds that were either older in nature or positioned outside of PPET's core mid-market focus and will crystallise a strong return for the Company. The proceeds provide additional firepower for PPET to deploy into core areas such as midmarket- focused funds and direct investments, at a potentially attractive point in the investment cycle, as well as reduce drawings on the Company's revolving credit facility and provide capital for other corporate initiatives such as share buybacks.

 

I believe this transaction further underlines the quality and attractiveness of PPET's broader portfolio, achieving a price equivalent to a 5% discount to NAV for essentially a non-core portfolio. The Board is particularly pleased to have achieved this outcome given PPET's share price discount to NAV and this further highlights the disconnect between the current discounts seen in listed private equity trusts compared to the private equity secondary market.

 

Board engagement

It has been a very busy year for the Board. abrdn announced its intention to sell our Manager to Patria in October 2023 and so the financial year began with extensive due diligence. The Board is collaborative and, I believe, strikes the right balance between supporting and challenging our management team.

 

We are constantly evaluating whether the Board remains fit for purpose and engaged the services of Lintstock to support us in our Board effectiveness review during the financial year. The review concluded that the Board is active and effective, and areas for improvement that were identified are in the process of being addressed.

 

From a succession planning perspective, the Board was delighted to announce the appointment of Duncan Budge to the Board with effect from 1 February 2025.

 

Duncan has extensive experience of investment trusts and private assets, and will bring a new perspective to the Board. Duncan will be seeking election to the Board at the AGM. I have served on the Board since 2014, as Chair since 2022 and, at the request of the Board, will seek shareholder approval to serve a further one year on the Board to hand over my Board Chair responsibilities seamlessly. I will step down from the Board at the AGM in March 2026.

 

Invitation to AGM

The Board enjoys interaction with shareholders and were delighted to see a good turnout at our AGM in March 2024. This year's AGM will be held on 25 March 2025 at 12:30pm at 12 Hay Hill, Mayfair, London, W1J 8NR and, like last year, will include a presentation by the Investment Manager followed by lunch. The Board encourages shareholders to attend and those who are not able to attend to submit proxy votes on the resolutions proposed in advance.

 

Outlook

The past couple of years have been tough for the investment trust sector, including private equity trusts like PPET. At the same time, there has been a lot of attention on the semi-liquid space in private equity, which aims to open the asset class to more investors.

 

I continue to believe that investment trusts are the best way for smaller investors to access private equity, due to features like daily liquidity, the evergreen nature of the portfolios and long-term track records, and I feel optimistic about PPET going forward. The Board continues to monitor PPET's share price and will continue to opportunistically buy back the Company's shares. We are committed to our dividend policy and continue to return capital to investors via four interim dividends each year. There are other ongoing market developments which potentially offer tailwinds to PPET's underlying portfolio and the evolution of its share price.

 

Firstly, private equity investment activity is picking up, with a number of high-profile deals announced in 2024, and I expect this trend to continue into 2025. Increased activity will drive portfolio company exits and cash distributions and should in theory act as a tailwind to NAV growth, since exits are typically realised at an uplift to prior valuation.

 

The latter point has the potential to provide more confidence to investors, in relation to private equity valuations. I remain hopeful that will help drive further buy-side demand for private equity trusts like PPET. Furthermore, any additional cuts in interest rates by central banks have the potential to catalyse both PE market activity and investor interest in PE investment trust shares.

 

On cost disclosures, I welcome the forbearance by the FCA and we look forward to understanding what the new regulatory regime will look like. However, I am optimistic that a long-term solution will be found that fairly represents the investment trust sector, proving investors of all types with a straightforward, accurate and comparable representation of costs. Private equity trusts like PPET stand to be one of the main beneficiaries of this change.

 

Lastly, you can expect our Manager to be focused on the same successful investment strategy, namely mid-market funds and direct investments, with continued growth in the latter. Shareholders can also be assured that the Board will continue to monitor developments closely and be alert to opportunities to create further value for PPET shareholders.

 

Alan Devine

Chair of the Board

29 January 2025

 

INVESTMENT MANAGER'S REVIEW

 

Summary of the Year

The acquisition by Patria has brought renewed energy and certainty to PPET's investment management team, but importantly has not resulted in a change in PPET's investment strategy.

 

Performance

PPET's portfolio returned 8.8% in constant currency over the course of the year (2023: 9.4%) and the Manager is pleased with this performance in a challenging market. However, the strengthening of Pound Sterling relative to the US Dollar and the Euro means that currency FX continues to act as a headwind to PPET's NAV performance, resulting in a NAV TR of 2.4% (2023: 5.4%) in the 12 months to 30 September 2024.

 

Putting the year's performance into context, the portfolio return has been at a similar level over the last three years, with FX being a tailwind to NAV TR in 2022 but a headwind in both 2023 and 2024. The performance in 2021 is an outlier, as it is by some distance the record year of performance across PPET's 23-year history.

 

Realised gains during the year were derived from full or partial sales of underlying portfolio companies, which were at an average valuation uplift of 25.6% compared to the unrealised value two quarters prior (2023: 18.5%). The headline realised return from the Investment Manager's Review continued portfolio exits equated to 2.1 times cost (2023: 2.5 times cost), which we consider a strong performance in what remained a challenging backdrop for private equity managers to conduct successful exit processes.

 

Aside from realisations, the key driver of the performance in 2024 has been the earnings growth of portfolio companies. The vast majority of PPET's underlying portfolio of private companies are growing, profitable and, importantly, cash generative. Many of these businesses are niche market leaders providing mission critical services operating in less cyclical sectors such as Technology, Healthcare, Consumer Staples and certain areas of Business Services.

 

	Pence per share
NAV as at 1 October 2023	777.7
Net realised gains and income from portfolio	+56.9
Net unrealised gains at constant FX on portfolio	+14.9
Net unrealised FX losses on portfolio	(43.6)
Dividends paid	(16.4)
Management fee, administrative and finance costs	(14.1)
Accretion arising from share buy-back scheme	+1.6
Net income from other assets	+3.1
NAV as at 30 September 2024	780.1

 

 

Top companies	% of portfolio	Median valuation multiple	Median leverage multiple	Average LTM* revenue growth	Average LTM* EBITDA growth
10	17.6%	17.4x	3.5x	13.5%	23.3%
20	36.1%	14.2x	3.8x	12.5%	20.0%
50	46.1%	13.5x	3.9x	11.3%	18.2%
100	63.9%	13.5x	3.9x	12.4%	18.1%

* LTM = Last 12 months

 

 

Nav total return and portfolio return in local currency	2020	2021	2022	2023	2024
NAV TR	11.7%	37.9%	14.1%	5.4%	2.4%
Portfolio return - constant currency	12.2%	47.4%	10.5%	9.4%	8.8%

 

 

	2020	2021	2022	2023	2024
Average exit uplift*	22%	41%	20%	18%	26%

* Compared to the valuation two quarters prior to exit

 

Drawdowns

 

	Amount
Nordic Capital Evolution Fund	£10.8 million
PAI VIII	£9.4 million
IK IX Luxco 15 S.a.r.l. (co-investment)	£7.8 million
Latour Co-Invest EDG (co-investment)	£7.7 million
Hg Saturn 3	£6.4 million
IK Partnership II	£6.3 million
MED BIO FPCI (secondary purchase)	£6.1 million
Nordic XI	£6.0 million
Altor V	£5.7 million
Altor Fund VI	£4.9 million
Other	£92.6 million

 

During the financial-year, £163.7 million was drawn down (2023: £193.2 million), primarily for investment into existing and new underlying portfolio companies. Of this, £118.5 million related to primary fund drawdowns (2023: £154.2 million), with the remainder related to direct investments and fund secondaries, which are fully under the control of the Manager and in line with plan. Direct investment and fund secondaries are covered in detail later in the review.

 

Fund drawdowns have fallen materially compared to the prior year due to the lower level of private equity merger and acquisition ('M&A') activity. Drawdowns during the period were mainly used to fund new investments, with notably large drawdowns relating to the following underlying portfolio companies:

 

·	Visma (Hg Saturn 3) - provider of cloud-based, mission-critical business and accounting software;
·	Equipe (Nordic Capital Evolution Fund I) - provider of outpatient healthcare services in the Netherlands;
·	Alphia (PAI VII) - leading manufacturer of pet food and treats for brands and retailers in North America;
·	A-Safe (IK Partnership Fund II) - manufacturer and distributor of industrial polymer safety barrier systems; and
·	BRP Systems (Nordic Capital Evolution Fund I) - Provider of software as a Service ('SaaS') enterprise resource planning ('ERP') platform for the fitness industry.

 

Private equity funds usually have credit facilities to finance new investments initially before drawing the capital from investors. We estimate that PPET had around £111.2 million held on these credit facilities at 30 September 2024 (2023: £79.5 million). This is a good proxy for upcoming drawdowns as we expect that these facilities will be drawn over the next 12 months.

 

Realisations

Total realisations (distributions and secondary sales) were £292.3 million during the year (2023: £202.9 million).

 

Distributions

 

	Amount
IK VIII	£16.6 million
CVC VII	£14.0 million
Advent International Global Equity VIII	£7.8 million
Cinven VI	£7.6 million
Permira V	£6.5 million
Altor V	£6.2 million
Exponent III	£6.1 million
Investindustrial Growth	£6.0 million
Nordic VII CV£5.5 million	£5.5 million
MSouth Equity Partners IV	£5.0 million
Other	£67.4 million
Secondary sales (various investments)	£143.7 million

 

During the financial-year, PPET received £148.6 million of distributions from funds (2023: £149.9 million). The largest distributions during the period related to the full exits of the following underlying portfolio companies, with the relevant funds stated in brackets:

 

·	Eres (IK Fund VIII) - French provider of financial technology services to the employee profit-sharing and retirement scheme markets;
·	Multiversity (CVC Fund VII) - provider of online higher education services based in Italy;
·	Barentz (Sixth Cinven Fund) - provider of ingredients for the nutrition, pharmaceuticals and personal care end markets;
·	Consilium (Nordic Capital IX) - producer of safety and safety-related technologies for the marine, oil and gas, transport and construction markets; and
·	Ontic (CVC Fund VII) - provider OEM-licensed parts and repair services for mature aerospace platforms.

 

Due to its diversified and high-quality nature, PPET's portfolio consistently generates realisations through the cycle, with annual realisations equating to at least 15% of opening portfolio value. The trend over the last five years is outlined in the Annual Report.

 

Secondary Sales

In September 2024, PPET completed the sale of 14 fund investments, representing 13% of the Company's portfolio at 31 August 2024. These fund investments were sold for a price equivalent to 95% of valuation at 31 March 2024, totalling £180.0m. The transaction results from a competitive sales process run by an established secondary intermediary with a number of high-quality secondary players participating.

 

The disposal realises a combined overall return of 1.9x multiple on invested capital and 16% internal rate of return ('IRR') for the 14 fund investments. Deferred consideration from the secondary sale of £157.2m will be received in three contractual payments with the first payment received in December 2024 (£58.3 million), the second in January 2025 (£5.1 million), and the final payment due in September 2025.

 

Outstanding Commitments

Outstanding commitments at the year-end amounted to £652.7 million, in line with prior year (30 September 2023: £652.0 million).

 

The value of outstanding commitments in excess of liquid resources as a percentage of portfolio value (referred to as the 'over-commitment ratio') was 28.5% at 30 September 2024 (30 September 2023: 35.2%). This is broadly in line with the figure 12 months prior and is at the low end of our long-term target range of 30%-75%. We estimate that £83.5 million of the reported outstanding commitments are unlikely to be drawn down (30 September 2023: £94.3 million), due to the nature of private equity investing, with private equity funds not always being fully drawn.

 

	Million
Outstanding commitments at 1 October 2023	652.0
Fund investment drawdowns	(121.4)
Direct investment and secondary funding	(42.3)
New commitments	+195.8
Foreign exchange impact	(31.7)
Secondary sales	(10.6)
Other	+10.9
Outstanding commitments at 30 September 2024	652.7

 

PPET's over-commitment ratio has been broadly consistent over the last five years.

 

Balance Sheet and Liquidity

The balance sheet remains in a strong position with cash and cash equivalents at 30 September 2024 of £28.4 million (30 September 2023: £9.4 million), current receivables from secondary sales of £130.0 million (30 September 2023: £30.0 million), and £159.4 million remaining undrawn of its £300.0 million revolving credit facility (30 September 2023: £197.7 million), totalling £317.8 million of short-term resources (30 September 2023: £237.2 million).

 

Investment Activity

PPET committed to 17 investments totalling £195.8 million during the year (2023: £174.8 million), with £112.9 million in primary funds, £27.8 million in fund secondaries and £55.2 million in direct investments.

 

Primary Funds

During the financial-year, £112.9 million was committed to six new primary funds (2023: £147.5 million into seven new primary funds). As a reminder, PPET's primary fund strategy is to partner with private equity firms, principally in Europe, that have genuine sector expertise and operational value creation capabilities with a core mid-market buyout orientation, ie focusing on businesses with an enterprise value between €100 million and €1 billion at entry.

 

 

Investment		£m	Description
IK Fund X		26.1	Focused primarily on mid-market businesses in Northern Continental Europe across business services, consumer/food, healthcare and industrials.
Bowmark Fund VII		25.0	Focused on lower mid-market businesses in the UK across software and services sectors.
Triton Fund 6		16.7	Mid-market buyout fund focused on investing in companies in the industrial technology, business services and healthcare sectors in North-Western Europe.
Investindustrial Fund VIII		16.6	Mid-market buyout fund focused on niches within the industrials, consumer and healthcare services sectors, primarily in Southern Europe.
Arbor Fund VI		15.6	US mid-market buy-out fund focused on investments in the food and beverage sector.
Altor Climate Transition Fund I		12.8	Focused on investments across Northern Europe that will help to decarbonise industries with a traditionally heavy carbon footprint.

 

Fund Secondaries

PPET committed £27.8 million into two new fund secondaries during the year (2023: £4.6 million into one new fund secondary investment).

 

Investment		£m	Description
Patria Secondary Opportunities Fund V		18.9	A fund that targets secondary transactions in the private equity lower-mid and mid-markets across Europe and North America.
Clean Biologics		8.8	Two contract testing development and manufacturing ('CDTMO') businesses, alongside PPET's core manager Archimed.

 

Direct Investments

During the year, PPET committed £55.2 million into direct investments (2023: £22.6 million). PPET committed £45.5 million to six new direct investments (2023: £17.0 million) and £9.7 million was invested into three follow-on investments in existing direct investments (2023: £5.6 million).

 

At 30 September 2024, there were 32 (2023: 26) direct investments in PPET's portfolio, equating to 25.7% of NAV (2023: 19.4%). The direct investment portfolio is slowly maturing, with an average investment age of 2.9 years at 30 September 2024 (2023: 2.2 years), and we are delighted with its performance so far. We believe that there are a number of candidates for exit over the next 12-24 months, which will return material cash back to PPET.

 

New Investments		£m	Description
European Digital Group		8.9	Business services provider focused on digital transformation. Investment alongside Latour Capital and Montefiore Investment.
Systra		8.9	Global consulting and transportation engineering company. Investment alongside Latour Capital
Nutripure		8.3	Direct-to-consumer French sports nutrition and health and wellness food supplements brand. Investment alongside PAI Partners.
Goodlife		7.7	Manufacturer of frozen snacks in Europe, with a diversified business mix across retail, out-of-home and industry. Investment alongside IK Partners.
Procemsa		7.3	Italian-headquartered vitamins and food supplements contact development and manufacturing organisation ('CDMO'). Investment alongside Investindustrial.
Channelle Pharma		4.3	Manufacturer of generic animal and human health products headquartered in Ireland. Investment alongside Exponent.

 

 

Follow-on investments		£m	Description
Visma		4.7	Provider of cloud-based, mission-critical business software. Investment alongside Hg.
Undisclosed company		4.2	European-headquartered technology business in the healthcare sector, the details of which are undisclosed due to confidentiality restrictions.
Undisclosed company		0.8	US-headquartered consumer business, the details of which remain undisclosed due to confidentiality restrictions.

 

 

Investment activity since 2020

	2020	2021	2022	2023	2024
Primary investments	£99.5m	£175.7m	£257.2m	£147.5m	£112.9m
Secondary investments	£12.5m	£54.5m	£17.1m	£4.6m	£27.8m
Direct investments	£28.0m	£76.9m	£66.1m	£22.6m	£55.2m

 

 

Portfolio Construction

The underlying portfolio consists of over 600 private companies, largely within the European mid-market. At 30 September 2024, 16 (2023 :12) companies equated to more than 1% of portfolio NAV based on underlying portfolio company exposure, with the largest single exposure being PPET's investment in Action, equating to 2.4% (2023: 2.1%).

 

Geographic Exposure¹

The portfolio is well diversified, which means that there isn't a reliance on one private equity manager, company, geographic region, sector or vintage to drive performance.

 

At 30 September 2024, 76% of underlying private companies were headquartered in Europe (2023: 75%). PPET's underlying portfolio remains largely oriented to North-Western Europe, with only 9% (2023: 10%) of underlying portfolio company exposure in Southern and Eastern Europe. PPET is well diversified by region across North-Western Europe, with the Nordics being the largest exposure at 16% (2023: 14%).

 

North America equates to 23% (2023: 24%) of the total, with exposure to the region obtained through European private equity managers that have expanded their operations into North America and US-headquartered lower mid-market private equity managers that PPET partners with for specific sector exposure (eg Great Hill Partners in technology, American Industrial Partners in industrials, Windrose in healthcare, and Seidler and Arbor in consumer).

 

1 Based on the latest available information from underlying managers. Figures represent percentage of total value of underlying portfolio company exposure. Geographic exposure is defined as the geographic region where underlying portfolio companies are headquartered.

 

 

	% Exposure as at
Geography	30 September 2024
Nordic		16
United Kingdom		14
France		13
Germany		12
Benelux		8
Spain		4
Italy		3
Other Europe		6
North America		23
Other ex-Europe		1

 

Sector Exposure¹

At 30 September 2024, technology and healthcare represented a combined 44% of the underlying portfolio company exposure (30 September 2023: 41%). When combined with consumer staples, these more stable, less cyclical sectors equate to over half of PPET's underlying portfolio at 56% (30 September 2023: 51%). It is worth noting that PPET generally invests in technology businesses that are profitable and business-to-business-focused, and therefore has relatively low exposure to higher growth, unprofitable technology businesses where the consumer is the customer.

 

The other half of the portfolio is exposed to more cyclical sectors, notably industrials, consumer discretionary and financials. That said, there are sub-sectors within these areas that provide growth opportunities, such as fintech, business services and industrial sub-sectors related to the 'green transition'. These businesses often have a valuable product or an essential service offering with a strong digital component. Some examples within our top 20 underlying portfolio companies by value include European Camping Group (outdoor accommodation), CFC Underwriting (cybersecurity insurance MGA), Trioplast (sustainable manufacturer of polyethylene film) and Planet (provider of payments solutions for hospitality and retail).

 

 

	% Exposure as at
Sector		30 September 2024
Information technology		23
Healthcare		21
Industrials		18
Consumer discretionary		12
Consumer staples		11
Financials		8
Materials		4
Utilities		1
Energy		1
Communication services		1

 

1 Based on the latest available information from underlying managers. Figures represent percentage of total value of underlying portfolio company exposure.

 

Maturity Analysis^1,2

The Manager does not try to time the market with respect to PPET, instead aiming for consistent exposure across recent vintage years. Therefore, there is an even split of portfolio companies at the underlying level that are approaching maturity (held for more than four years) and companies typically still in the value creation phase (held for less than four years). With 52% being in vintages of four years or more (30 September 2023: 49%), this should underpin exit activity and distributions in the coming months and years.

 

Holding period		30 September 2024
1 year		10%
2 years		22%
3 years		26%
4 years		19%
5 years		10%
>5 years		23%

 

1 Based on the latest available information from underlying managers. Figures represent % of total value of underlying portfolio company exposure.

2 The holding period is the length of time that an underlying portfolio company has been held since its initial investment date by the Company.

 

Outlook

The acquisition by Patria has brought renewed energy and certainty to the Manager's team, but importantly has not resulted in a change in PPET's investment strategy. Therefore, the Manager's focus going forward remains on the European mid-market. We will continue to partner with a small group of leading private equity managers that we believe are differentiated, specialist and can bring significant value to the businesses they invest in.

 

In line with our current strategic plan, we will continue to look to increase the proportion of direct investments in the PPET portfolio, alongside our core managers, which will reduce the underlying costs borne by PPET and therefore provide the potential for greater performance. We expect direct investments to equate to around 30% of the portfolio by value over the short-to-medium term, consisting of a steady-state portfolio of 35-40 private companies.

 

The private equity secondary market continues to grow and mature, and remains highly relevant to PPET's approach, both from a buy-side and sell-side perspective. PPET was a net seller in the secondary market in 2024, as we took advantage of attractive secondary market pricing to sell a portfolio of funds. Following this proactive sale, we feel that the remaining PPET portfolio is well-positioned in terms of its mid-market orientation and maturity, and there is less need for further secondary sales in the immediate future. Therefore, PPET is more likely to be a net buyer in the secondary market in the coming years.

 

More generally, private equity market sentiment has improved in 2024 compared to 2023, and we have seen some notable large exits in PPET's portfolio and several more portfolio companies rumoured to be at advanced stages of sales processes. Furthermore, we have seen European PE-backed initial public offerings ('IPOs') return in the form of Douglas, Renk and Galderma, in addition to the listing of CVC, a leading private equity firm, in Amsterdam. We expect this gradual uptick in private equity activity to continue into 2025.

 

The PPET portfolio continues to perform resiliently and remains well-positioned for a pick-up in activity levels. Any uptick in private equity activity should result in an increase in distributions to PPET and be a tailwind to NAV growth, given private equity backed companies tend to trade at an uplift to their last bottom-up valuation. Furthermore, following the secondary sales in 2024 and the upsizing of PPET's debt facility to £400.0 million, we feel that PPET is in a strong balance sheet position and has ample firepower to take advantage of the exciting investment opportunities that lie ahead. As such, we are excited about the potential for PPET as we look forward to 2025.

 

Alan Gauld,

Lead Investment Manager and Senior Investment Director

for Patria Capital Partners LLP

29 January 2025

 

TEN LARGEST INVESTMENTS

at 30 September 2024

 

1   3.0% of NAV (30 September 2023: 3.2%)		Nordic Capital		Invests in medium to large-sized buyout deals in Northern Europe, through five dedicated sector teams, with the ability to invest in healthcare on a global basis
		Fund Size: €4.3bn Strategy: Mid to large buyouts Enterprise Value of investments: €200m-€800m Geography: Northern Europe (Global in Healthcare) Website: www.nordiccapital.com		Nordic Capital Fund IX			30/09/24			30/09/23
				Value (£'000)			35,275			37,762
				Cost (£'000)			23,786			23,403
				Commitment (€'000)			30,000			30,000
				Amount Funded			100.0%			100.0%
				Income (£'000)*			-			-

 

2   2.9% of NAV (30 September 2023: 2.9%)		Altor		Focuses on investing in and developing medium-sized companies with a Nordic origin that offer potential for value creation through revenue growth, margin expansion, improved capital management and strategic re-positioning.
		Fund Size: €2.1bn Strategy: Mid-market buyouts Enterprise Value of investments: €50m-€500m Geography: Northern Europe Website: www.altor.com		Altor Fund IV			30/09/24			30/09/23
				Value (£'000)			34,368			34,954
				Cost (£'000)			30,347			29,206
				Commitment (€'000)			55,000			55,000
				Amount Funded			81.2%			76.0%
				Income (£'000)*			308			-

 

3   2.8% of NAV (30 September 2023: 3.1%)		Structured Solutions IV		A diversified secondary transaction comprising large capbbuyout funds in Europe and the US.
		Fund Size: $125m Strategy: Various Enterprise Value of investments: $500m-$5bn Geography: Europe and North America		Structured Solutions IV Primary Holdings			30/09/24			30/09/23
				Value (£'000)			32,786			36,687
				Cost (£'000)			29,749			31,066
				Commitment ($'000)			62,500			62,500
				Amount Funded			72.6%			72.0%
				Income (£'000)			-			886

 

4   2.7% of NAV (30 September 2023: 3.8%)		CVC Capital Partners		Undertakes medium and large sized buyout transactions across a range of industries and geographies.
		Fund Size: €16.4bn Strategy: Mid to large buyouts Enterprise Value of investments: $500m-$5bn Geography: Europe and North America Website: www.cvc.com		CVC Capital Partners VII			30/09/24			30/09/23
				Value (£'000)			32,623			44,945
				Cost (£'000)			22,417			24,898
				Commitment (€'000)			35,000			35,000
				Amount Funded			100.0%			97.2%
				Income (£'000)*			34			1,945

 

5   2.5% of NAV (30 September 2023: 2.9%)		PAI Partners		Targets upper mid-market businesses in Western Europe, with a particular focus on continental Europe. Typically invests in market leaders across healthcare, business services, food & consumer goods and industrials sector
		Fund Size: €5.1bn Strategy: Upper Mid-market buyouts Enterprise Value of investments: €300m - €1.2bn Geography: Western Europe Website: www.paipartners.com		PAI Europe VII			30/09/24			30/09/23
				Value (£'000)			29,466			29,681
				Cost (£'000)			22,724			22,789
				Commitment (€'000)			30,000			30,000
				Amount Funded			87.7%			86.5%
				Income (£'000)*			-			-

 

6   2.4% of NAV (30 September 2023: 2.2%)		Action		Since its establishment in 1993, Benelux-based Action has grown into the leading non-food discount retailer in the region with more than 2,750 stores and over 74,500 employees.
		Fund Size: €2.5bn Sector: Consumer staples Location: Netherlands Year of Investment: 2020 Private Equity Manager: 3i Group plc Investment: Co-investment Company Website: www.action.nl		3i 2020 Co-investment 1 SCSp			30/09/24			30/09/23
				Value (£'000)			28,874			26,160
				Cost (£'000)			6,374			6,380
				Commitment (€'000)			7,939			7,939
				Amount Funded			100.0%			100.0%
				Income (£'000)*			2,211			-

 

7   2.4% of NAV (30 September 2023: 2.2%)		Altor		Focuses on investing in and developing medium-sized companies often with a Nordic origin and sustainability angle, that offer potential for value creation through revenue growth, margin expansion, improved capital management and strategic re-positioning
		Fund Size: €2.6bn Strategy: Mid-market buyouts EV of investments: €150m-€1bn Geography: Northern Europe Website: www.altor.com		Altor Fund V			30/09/24			30/09/23
				Value (£'000)			28,157			26,706
				Cost (£'000)			26,836			23,069
				Commitment (€'000)			43,000			43,000
				Amount Funded			68.7%			53.4%
				Income (£'000)			28			238

 

8   2.2% of NAV (30 September 2023: 2.2%)		Triton		Targets mid-market companies that are operating below their full potential in the industrials, business services and healthcare sectors in Northern and Western Europe.
		Fund Size: €5.3bn Strategy: Mid-market buyouts EV of investments: €150m-€750m Geography: Northern and Western Europe Website: www.triton-partners.com		Triton Fund V			30/09/24			30/09/23
				Value (£'000)			26,636			26,375
				Cost (£'000)			16,766			15,632
				Commitment (€'000)			30,000			30,000
				Amount Funded			94.1%			86.2%
				Income (£'000)			23			-

 

9   2.1% of NAV (30 September 2023: 2.5%)		Exponent		Invests in medium- to large-sized buyout deals in Northern Europe, through five dedicated sector teams, with the ability to invest in healthcare on a global basis.
		Fund Size: £1.0bn Strategy: Mid-market buyouts EV of investments: £75m-£350m Geography: UK Website: www.exponentpe.com		Exponent Private Equity Partners III, LP.			30/09/24			30/09/23
				Value (£'000)			25,549			30,273
				Cost (£'000)			19,065			21,232
				Commitment (£'000)			28,000			28,000
				Amount Funded			100.0%			100.0%
				Income (£'000)			678			1,566

 

10   2.1% of NAV (30 September 2023: 1.4%)		Capiton		Invests in small cap and lower mid-market companies in the DACH region with a primary focus in the healthcare & life science and high-tech industrials sectors.
		Fund Size: €504m Strategy: Mid to large buyouts EV of investments: €25m-€100m Geography: DACH Website: www.capiton.de		Capiton VI			30/09/24			30/09/23
				Value (£'000)			25,267			16,280
				Cost (£'000)			10,252			9,979
				Commitment (€'000)			20,000			20,000
				Amount Funded			62.0%			58.0%
				Income (£'000)*			-			-

 

* Performance information has been prepared by PPET and has not been approved by the General Partners of the funds or any of their Associates. Income figures are for the year ended 30 September 2024 and 30 September 2023 respectively. The Company's position in Action is held through 3i 2020 Co-investment 1 SCSp, a special purpose vehicle managed by 3i as co-investment lead.

Ten Largest Underlying Private Companies

Largest Ten Underlying Private Companies at 30 September 2024^1,2

The below represents the ten largest underlying private companies which are indirectly held through the Company's fund investments and/or direct investments.

 

1	2.4% of NAV (2023: 2.2%)	Action	Sector: Consumer Staples Location: Netherlands Year of Investment: 2020 Private Equity Manager: 3i Group plc Investment: 3i 2020 Co-investment 1 SCSp Company Website: www.action.nl	Since its establishment in 1993, Benelux-based Action has grown into the leading non-food discount retailer in the region with more than 2,750 stores and over 74,500 employees.
2	2.1% of NAV (2023: 0.9%)	Wundex	Sector: Healthcare Location: Germany Year of Investment: 2021 Private Equity Manager: Capiton AG Investment: Capiton VI Wundex Co-Investment/Capiton VI Company Website: www.wundex.com	Wundex is a leading home care provider for patients with chronic wounds. The company's qualified wound managers provide home care services that enable faster and more effective wound treatment and significantly reduce the workload of general care providers and physicians, backed by an integrated digital platform.   In addition to treatment services, the company also offers a complete range of 60,000 home care products and decubitus systems. With its three business units: home care services, home care products and decubitus systems, Wundex has built a fully integrated unique home care offering.
3	2.0% of NAV (2023: 1.8%)	European Camping Group	Sector: Consumer Discretionary Location: France Year of Investment: 2021 Private Equity Manager: PAI Partners Investment: ECG Co-invest SLP/PAI Europe VII/PAI Europe VIII/ECG 2 Co-invest SLP Company Website: www.europeancampinggroup.com	European Camping Group is a leading outdoor accommodation operator in Europe. At acquisition, ECG operated a fleet of 21,000 high-quality holiday lets across over 300 European sites. It operates under a number of strong brands, including Eurocamp and Homair.
4	1.9% of NAV (2023: 0.9%)	Visma	Sector: Information Technology Location: Norway Year of Investment: 2020 Private Equity Manager: HgCapital Investment: Hg Vardos Co-invest L.P/Hg Saturn 2/Hg Saturn 3/Hg Vega Co-Invest L.P. Company Website: www.visma.com	Visma is the leading provider of mission-critical business software to small & medium-sized companies and the public sector outside of North America. Headquartered in Oslo, the company provides approximately 1.9 million paying customers with SaaS solutions covering: accounting, resource planning, payroll, procurement and transaction processing. It is the largest provider of cloud/SaaS to these sectors outside of North America, with ~€2.5 billion in Annual Recurring Revenue and customers in ~30 countries.
5	1.7% of NAV (2023: 1.6%)	Access	Sector: Information Technology Location: UK Year of Investment: 2018 Private Equity Manager: HgCapital Investment: Hg Saturn 3/HgCapital 8 Company Website: www.theaccessgroup.com	Founded in 1991, the Access Group ('Access') is a leading UK mid-market Enterprise Resource Planning business, providing financial management systems and human capital management software, as well as industry specific software solutions. Access' software helps over 75,000 customers across commercial and not-for-profit organisations to work efficiently, with expertise across numerous industries.
6	1.6% of NAV (2023: 0.6%)	GRITEC	Sector: Industrials Location: Germany Year of Investment: 2022 Private Equity Manager: Capiton AG Investments: Capiton VI Website: www.gritec.com	GRITEC (formerly: Betonbau Group) was established in 1963. Today, GRITEC is the largest German player in the attractive niche market of turnkey technical stations such as transformer stations for power grids, charging infrastructure for e-mobility and point of presence stations for telecommunication networks.
7	1.5% of NAV (2023: 1.4%)	Uvesco	Sector: Consumer Staples Location: Spain Year of Investment: 2022 Private Equity Manager: PAI Partners Investments: Uvesco Co-Invest SCSp/PAI Mid-Market I Company Website: www.uvesco.es	Uvesco is a leading food retailer in the North of Spain with a growing presence in Madrid. The company follows a differentiated model based on proximity stores and a high-quality offering, including a significant fresh product component that is locally sourced and sold through its network of over 270 stores across six regions.
8	1.5% of NAV (2023: 1.3%)	Froneri	Sector: Consumer Discretionary Location: United Kingdom Year of Investment: 2019 Private Equity Manager: PAI Partners Investments: PAI Strategic Partnerships SCSp/PAI Europe VII Company Website: www.froneri.com	Froneri is a global ice cream manufacturer, and the largest pure-play ice-cream manufacturer globally, benefitting from market-leading positioning in both branded and private label ice cream. It was formed as a joint venture between R&R Ice cream plc and Nestle in 2016.
9	1.5% of NAV (2023: 1.4%)	Namsa	Sector: Healthcare Location: United States Year of Investment: 2020 Private Fund Manager: ArchiMed SaS Investment: MPI-COI-NAMSA SLP Company Website: www.namsa.com	NAMSA is the global industry leading Contract Research Organisation (CRO) for preclinical and clinical medical device companies, and a global market leader in preclinical and biocompatability testing.
10	1.4% of NAV (2023: 1.2%)	CFC	Sector: Financials Location: United Kingdom Year of Investment: 2022 Private Equity Manager: Vitruvian Partners Investments: CFC Continuation Fund/Vitruvian IV Company Website: www.cfc.com	CFC underwriting is a technology-led insurance platform, and is a global leader and category innovator in the cyber market.

 

INVESTMENT PORTFOLIO

at 30 September 2024

 

Vintage	Investment	Number of investments	Outstanding commitments £'000	Cost £'000	Valuation £'0001	Net multiple2	% of NAV
2018	Nordic Capital Fund IX	12	10,502	23,786	35,275	1.7x	3.0
2014	Altor Fund IV	16	8,618	30,347	34,368	1.7x	2.9
2021	Structured Solutions IV Primary Holdings	53	12,770	29,749	32,786	1.3x	2.8
2017	CVC Capital Partners VII	28	1,622	22,417	32,623	1.9x	2.7
2019	PAI Europe VII	19	4,822	22,724	29,466	1.5x	2.5
2020	3i 2020 Co-investment 1 SCSp3	1	-	6,374	28,874	5.1x	2.4
2019	Altor Fund V	36	8,035	26,836	28,157	1.3x	2.4
2019	Triton Fund V	20	8,427	16,766	26,636	1.5x	2.2
2015	Exponent Private Equity Partners III, LP.	8	3,059	19,065	25,549	1.9x	2.1
2020	Capiton VI	10	6,354	10,252	25,267	2.4x	2.1
2017	HgCapital 8	8	2,442	6,086	24,843	2.8x	2.1
2021	IK Partnership II	6	581	21,083	24,595	1.2x	2.1
2020	IK IX	15	672	20,769	24,327	1.2x	2.0
2020	Nordic Capital X	16	3,693	17,752	23,692	1.3x	2.0
2020	Investindustrial VII	13	7,195	14,908	23,444	1.5x	2.0
2019	American Industrial Partners VII	16	3,096	15,335	23,010	1.6x	1.9
2020	Vitruvian IV	27	2,036	19,179	22,750	1.2x	1.9
2014	CVC VI	19	1,522	13,813	21,968	2.2x	1.8
2021	Capiton VI Wundex Co-Investment3	1	3,068	2,914	20,945	4.4x	1.8
2016	IK Fund VIII	12	2,038	11,355	18,876	1.9x	1.6
2019	MSouth Equity Partners IV	13	1,185	13,845	18,869	1.5x	1.6
2021	Nordic Capital Evolution Fund	10	10,039	15,459	18,113	1.2x	1.5
2020	MPI-COI-NAMSA SLP3	1	1,807	5,573	17,490	2.7x	1.5
2022	Hg Saturn 3	6	11,968	15,111	16,095	1.1x	1.4
2021	Excellere Partners Fund IV	4	14,079	12,956	15,884	1.2x	1.3
2021	Arbor Co-Investment LP3	1	-	8,374	15,723	1.9x	1.3
2013	TowerBrook Investors IV	22	9,840	12,102	15,299	2.2x	1.3
2019	Bridgepoint Europe VI	17	516	10,511	15,203	1.3x	1.3
2021	Advent Technology II-A	13	11,155	13,245	15,154	1.1x	1.3
2020	Triton Smaller Mid-Cap Fund II	9	9,876	11,209	15,151	1.3x	1.3
2022	Uvesco Co-invest3	1	2,122	6,293	14,846	2.1x	1.2
2021	ECG Co-invest SLP3	1	3	6,920	14,447	2.1x	1.2
2022	Advent International Global Private Equity X	18	13,062	12,398	14,357	1.2x	1.2
2019	PAI Strategic Partnerships SCSp	2	71	6,705	14,283	2.1x	1.2
2020	Hg Genesis 9	12	3,184	9,590	14,125	1.4x	1.2
2020	Hg Saturn 2	7	3,247	8,524	12,994	1.4x	1.1
2020	PAI Mid-Market I	10	9,872	11,280	12,842	1.1x	1.1
2020	Seidler Equity Partners VII L.P.	7	842	13,230	12,799	1.0x	1.1
2021	MI NGE S.L.P.3	1	803	8,153	12,136	1.5x	1.0
2014	PAI Europe VI	11	1,383	4,539	12,119	1.9x	1.0
2013	Nordic Capital VIII	16	2,682	20,167	12,091	1.5x	1.0
2021	Hg Isaac Co-Invest LP3	1	38	7,571	11,140	1.5x	0.9
2021	MPI-COI-PROLLENIUM SLP3	1	1,348	7,159	10,294	1.4x	0.9
2021	Eurazeo Payment Luxembourg Fund SCSp3	1	1,046	5,350	10,093	1.3x	0.8
2023	One Peak Co-invest III LP3	1	-	9,434	9,876	1.0x	0.8
2023	Maguar Continuation Fund I GmbH & Co. KG3	1	906	6,767	9,865	1.5x	0.8
2022	PAI Europe VIII	8	15,204	9,955	9,706	1.0x	0.8
2021	CDL Coinvestment SPV3	1	-	5,294	9,673	1.8x	0.8
2021	WindRose Health Investors Fund VI	9	7,333	8,493	9,400	1.1x	0.8
2019	Vitruvian I CF LP	6	7,581	7,060	9,181	1.3x	0.8
2021	IK Co-invest Questel3	1	-	8,658	9,117	1.1x	0.8
2021	VIP SIV I LP3	1	3,330	5,670	9,045	1.6x	0.8
2020	Hg Vardos Co-invest L.P.3	1	-	4,244	8,933	2.0x	0.7
2020	Vitruvian III	29	917	5,108	8,901	2.2x	0.7
2023	IK IX Luxco 15 S.a.r.l.3	1	-	7,773	8,588	1.1x	0.7
2022	Nordic Capital Fund XI	11	16,574	8,593	8,285	1.0x	0.7
2019	Great Hill Partners VII	16	296	7,617	7,909	1.6x	0.7
2018	Investindustrial Growth	3	5,669	11,041	7,700	2.2x	0.6
2021	Latour Co-invest Funecap*,3	1	-	4,287	7,431	1.6x	0.6
2021	Permira Growth Opportunities II	15	17,408	10,199	7,303	0.8x	0.6
2017	Onex Partners IV LP	7	535	9,127	7,292	1.3x	0.6
2022	ArchiMed - Med Platform 2	5	16,940	8,111	7,177	0.9x	0.6
2024	Latour Co-Invest EDG*,3	1	1,237	7,705	7,163	0.9x	0.6
2020	Hg Mercury 3	10	4,312	4,592	6,973	1.5x	0.6
2023	Procemsa Build-Up SCSp3	1	2,559	4,662	6,783	1.5x	0.6
2022	Altor Fund VI	9	19,806	5,291	6,628	1.3x	0.6
2019	Alphaone International S.à.r.l.3	1	1,650	3,522	6,403	1.8x	0.5
2023	Capiton Quantum GmbH & Co	2	702	3,857	6,246	1.6x	0.5
2016	Astorg VI	5	956	205	6,126	1.7x	0.5
2022	Hg Genesis 10	4	19,969	5,184	6,015	1.2x	0.5
2021	Bengal Co-Invest SCSp3	1	2,294	6,198	5,927	1.0x	0.5
2021	MPI-COI-SUAN SLP3	1	36	6,402	5,904	0.9x	0.5
2021	bd-capital Partners Chase3	1	-	4,291	5,838	1.4x	0.5
2024	MED BIO FPCI	2	2,758	6,065	5,832	1.0x	0.5
2014	Permira V	10	701	7,078	5,645	3.1x	0.5
2024	Hg Vega Co-Invest L.P.3	1	-	4,801	5,589	1.2x	0.5
2022	Leviathan Holdings, L.P.3	1	4	4,863	4,971	1.0x	0.4
2024	Exponent Herriot Co-Investment Partners, LP3	1	809	3,444	4,907	1.4x	0.4
2021	Nordic Capital WH1 Beta, L.P.3	1	71	3,622	4,858	1.2x	0.4
2021	GPMS Omega Holdco Limited3	1	17	4,259	4,291	1.0x	0.4
2022	Investindustrial Growth III	3	20,910	4,231	3,860	0.9x	0.3
2021	Great Hill Equity Partners VIII	7	10,637	4,587	3,833	0.8x	0.3
2023	Seidler Equity Partners VIII, L.P.	3	10,470	4,647	3,791	0.8x	0.3
2023	Latour Co-invest Funecap II*,3	1	-	2,952	3,112	1.1x	0.3
2021	ArchiMed III	6	8,892	3,756	3,005	0.8x	0.3
2023	Hg Mercury 4	1	21,640	3,386	2,963	0.9x	0.2
2022	AV Invest B3*,3	1	205	4,887	2,908	0.6x	0.2
2022	One Peak Growth III	8	9,088	3,535	2,903	0.8x	0.2
2023	Latour Capital IV	2	21,142	3,953	2,742	0.7x	0.2
2015	Capiton V	8	157	7,324	2,696	0.8x	0.2
2021	Hg Riley Co-Invest LP3	1	-	6,836	2,565	0.4x	0.2
2023	ECG 2 Co-Invest S.L.P.3	1	499	2,132	2,564	1.2x	0.2
2012	IK Fund VII	6	1,663	5,871	2,387	2.0x	0.2
2001	CVC III*	1	388	4,110	1,793	2.7x	0.2
2022	American Industrial Partners V	6	30	1,327	1,352	1.4x	0.1
2023	Montefiore Investment VI	2	15,143	1,528	1,182	0.8x	0.1
2008	CVC V*	2	415	4,310	941	2.4x	0.1
2023	Vitruvian V	5	23,141	1,876	883	0.5x	0.1
2019	Gilde Buy-Out Fund IV	1	-	2,262	538	1.2x	0.0
2006	3i Eurofund V	0	-	9,282	171	2.7x	0.0
2024	Bowmark Capital Partners VII, L.P.	0	25,000	-	132	n/a	0.0
2024	Altor ACT I (No. 1) AB	4	12,204	306	110	0.4x	0.0
2023	Montefiore Expansion I	1	7,946	383	106	0.0x	0.0
2007	Industri Kapital 2007 Fund*	0	1,444	5,545	90	1.4x	0.0
2015	Nordic Capital VII	2	1,474	6,765	-	1.4x	0.0
2023	IK X Fund	0	24,962	-	-	n/a	0.0
2024	Arbor Investments VI, L.P.4	0	14,910	-	-	n/a	0.0
2024	Investindustrial VIII4	0	16,641	-	-	n/a	0.0
2024	Latour Co-Invest Systra3,4	0	8,820	-	-	n/a	0.0
2024	Nutripure Co-Invest SCSp3,4	0	8,321	-	-	n/a	0.0
2024	Patria SOF V SCSp4	0	18,638	-	-	n/a	0.0
2024	Triton Fund 6 SCSp4	0	16,641	-	-	n/a	0.0
	Total investments5	652,709	917,037	1,177,106		98.6	652,709
	Non-portfolio assets less liabilities			14,998		1.4
	Total shareholders' funds			1,192,104		100.0

 

1All funds are valued by the manager of the relevant fund or direct investment as at 30 September 2024, with the exception of those funds suffixed with an * which were valued as at 30 June 2024 or initial funding amount paid.

2. The net multiple has been calculated by the Manager in sterling on the basis of the total realised and unrealised return for the interest held in each fund and co-investments.

These figures have not been reviewed or approved by the relevant fund or its manager.

3. Direct investment position.

4. New commitment for which an underlying company has yet to be acquired.

5. The 763 underlying investments represent holdings in 616 separate underlying private companies, 44 underlying fund investments and 9 underlying direct investments.

 

TOP 30 UNDERLYING PRIVATE COMPANY INVESTMENTS

at 30 September 2024

 

Entity	Description	Fund/Co-investment	Year of Investment1	% of  NAV2
Action	Non-food discount retailer	3i 2020 Co-investment 1 SCSp	2020	2.4%
Wundex	Home care provider	Capiton VI Wundex Co-Investment / Capiton VI	2021	2.1%
ECG	European leader in outdoor accommodation market	ECG Co-invest SLP / PAI Europe VII / PAI Europe VIII / ECG 2 Co-invest SLP	2021	2.0%
Visma	Accounting software and services	Hg Vardos Co-invest L.P / Hg Saturn 2 / Hg Saturn 3 / Hg Vega Co-Invest L.P.	2020	1.9%
Access Group	Software Solutions	HgCapital 8 / Hg Saturn 3	2018	1.7%
Gritec	Specialist for technical buildings	Capiton VI	2022	1.6%
Uvesco	Leading Spanish regional grocer	Uvesco Co-invest / PAI Mid-Market I	2022	1.5%
Froneri	Leading independent global ice cream manufacturer	PAI Strategic Partnerships SCSp / PAI Europe VII	2019	1.5%
NAMSA	Contract research organisation for medical devices sector	MPI-COI-NAMSA SLP	2020	1.5%
CFC Underwriting	Global leader in the cyber insurance market	CFC Continuation Fund / Vitruvian IV	2022	1.4%
ACT	Leading global provider of market-based carbon footprint reduction solutions	Arbor Co-Investment LP / Bridgepoint Europe VI	2021	1.3%
CDL	Providing support to the medical profession through advanced diagnostics	CDL Coinvestment SPV / Excellere Partners Fund IV	2021	1.3%
Trioworld	Manufacturer of polyethylene film	Altor Fund IV	2018	1.3%
Funecap	Operator of funeral infrastructure and services	Latour Co-invest Funecap / Latour Co-invest Funecap II / Latour IV	2021	1.2%
Insightsoftware	Financial reporting and performance management software provider	Hg Isaac Co-Invest LP / Hg Saturn 2	2021	1.1%
Mademoiselle Desserts	Premium sweet bakery manufacturer	Alphaone International S.à.r.l. / IK Fund VIII	2018	1.1%
Questel	IP management software provider	IK Co-invest Questel / IK IX	2020	1.0%
Groupe NGE	Multi specialist and independent French public works provider	MI NGE S.L.P.	2021	1.0%
Planet	Leading provider of integrated payment solutions for hospitality and retail	Eurazeo Payment Luxembourg Fund SCSp	2021	0.9%
Undisclosed3	Medical aesthetics product manufacturer	MPI-COI-PROLLENIUM SLP	2021	0.9%
GoodLife	Manufacturer of frozen snacks	IK IX Luxco 15 S.a.r.l. / IK IX	2023	0.8%
HRworks	HR software provider	Maguar Continuation Fund I GmbH & Co. KG	2023	0.8%
EDG	Digital transformation and digital marketing services provider	Latour Co-Invest EDG / Latour Capital IV	2024	0.8%
Docplanner	Leading global online healthcare platform	One Peak Co-invest III LP	2023	0.8%
Norican	Metallic parts formation and preparation industry	Altor Fund IV	2015	0.7%
Litera	Provider of end to end document lifecycle solutions to the legal and life sciences industries	HgCapital 8 / Hg Genesis 9	2019	0.7%
R1 RCM	Healthcare revenue services	TowerBrook Investors IV	2016	0.7%
La Doria	Manufacturer of private label food products	Investindustrial VII	2022	0.7%
Tropicana	Global manufacturer of branded juice products	Bengal Co-Invest SCSp / PAI Europe VII	2022	0.7%
Esperi Care	Private social and health care	Triton Smaller Mid-Cap Fund II	2022	0.6%
Total				36.1%

1 Year of investment is disclosed as the first year of investment by a portfolio investment.

2 All percentage of NAV figures are based on gross valuations, before any carry provision.

3 Due to disclosure restrictions associated with our holding in the associated fund or co-investment, we are unable to name the underlying private company.

 

STRATEGIC REPORT

 

INVESTMENT STRATEGY

Current Investment Objective

The Company's investment objective is to achieve long-term total returns through holding a diversified portfolio of private equity funds and direct investments into private companies alongside private equity managers ("co-investments"), a majority of which will have a European focus.

 

Current Investment Policy

The Company: (i) commits to private equity funds on a primary basis; (ii) acquires private equity fund interests in the secondary market; and (iii) makes direct investments into private companies via co-investments and single-asset secondaries. Its policy is to maintain a broadly diversified portfolio by country, industry sector, maturity and number of underlying investments.

 

The objective is for the portfolio to comprise around 50 "active" private equity fund investments; this excludes funds that have recently been raised, but have not yet started investing, and funds that are close to or being wound up. The Company may also invest up to 25% of its assets in direct investments into private companies, via co-investments alongside private equity managers.

 

The Company may also hold direct private equity investments or quoted securities as a result of distributions in specie from its portfolio of fund investments. The Company's policy is normally to dispose of such assets where they are held on an unrestricted basis.

 

To maximise the proportion of invested assets, the Company follows an over-commitment strategy by making commitments which exceed its uninvested capital. In making such commitments, the Manager, together with the Board, will take into account the uninvested capital, the value and timing of expected and projected cash flows to and from the portfolio and, from time to time, may use borrowings to meet drawdowns. The Board has agreed that the overcommitment ratio should sit within the range of 30% to 75% over the long term.

 

The Company's maximum borrowing capacity, defined in its Articles of Association, is an amount equal to the aggregate of the amount paid up on the issued share capital of the Company and the amount standing to the credit of the reserves of the Company. However, it is expected that borrowings would not normally exceed 30% of the Company's net assets at the time of drawdown.

 

The Company's non-sterling currency exposure is principally to the euro and US dollar. The Company does not seek to hedge this exposure into sterling, although any borrowings in euros and other currencies in which the Company is invested would have such a hedging effect.

 

Cash held pending investment is invested in short-dated government bonds, money-market instruments, bank deposits or other similar investments. Cash held pending investment may also be invested in other listed investment companies or trusts. The Company will not invest more than 15% of its total assets in such listed equities.

 

The investment limits described above are all measured at the time of investment.

 

STAKEHOLDER ENGAGEMENT AND RESPONSIBLE MANAGEMENT

 

Directors' Duties and Stakeholder Engagement

The PPET Directors' overarching duty is to act in a way that they consider, in good faith, to promote the success of PPET for the benefits of its members as a whole in accordance with s172 of the Companies Act 2006.

 

During discussions and deliberations, the Directors must take into account the long-term consequences of their decisions, the interests of PPET's various stakeholders and the impact PPET has on the community and the environment, with a view to maintaining a reputation for high standards of business conduct and fair treatment between the members of the Company.

 

Stakeholders	Board engagement
Shareholders and Prospective Investors   The owners and future owners of PPET. Shareholder support and engagement is critical to the Company and delivery of its long-term strategy.	The Board is committed to maintaining open channels of communication and engaging with shareholders and prospective investors. The Board seeks feedback from shareholders and prospective investors to gain an understanding of their views, both formally and informally.   Formal communication methods include:   AGM: The AGM provides an opportunity for the Directors to engage with shareholders and answer their questions in the formal AGM environment, and also informally over refreshments afterwards. At the AGM, there is typically a presentation on the Company's performance and the future outlook as well as an opportunity to ask questions of the Manager and Board.   Whilst the Board has historically alternated the location of the AGM between Edinburgh and London, the Board was encouraged with the number of shareholders in attendance and the levels of engagement at the AGM in 2024 in London and, as such, has resolved to hold the AGM in London on 25 March 2025. The Board will consider an AGM in Edinburgh in future.   The Board encourages shareholders to attend the AGM and for those unable to attend, to lodge their votes by proxy on all of the resolutions put forward.   Publications: PPET publishes a full Annual Report in January each year that contains a Strategic Report, governance section, Financial Statements and additional information. The report is available online and in paper format. PPET also produces a Half-Yearly Report each year. The purpose of these reports is to provide shareholders with a clear understanding of PPET's activities, portfolio, financial position and performance.   The Manager also publishes a monthly factsheet and a monthly Estimated NAV, available at patriaprivateequitytrust.com.   The Board welcomes feedback from shareholders and prospective investors on its publications to ensure the reports and updates are transparent and understandable.   Shareholder meetings: As PPET is an investment trust and does not have any Executive Directors, shareholder meetings are often held with the Manager rather than members of the Board. Shareholders are able to meet with Patria throughout the year and both the Manager and PPET's Broker reports back to the Board on every shareholder meeting. This allows the Directors to hear feedback from underlying shareholders.   The Chair, the Senior Independent Director and other members of the Board are available to meet with shareholders to understand their views directly at any time during the year.   Following the appointment of Investec as Broker, and the Manager's purchase by Patria, a significant number of meetings had been held with shareholders throughout the year.   Investor relations and marketing: PPET's website patriaprivateequitytrust.com contains a range of information from the Manager including videos, portfolio case studies, podcasts and presentations. Furthermore, details of financial results, the investment process and Manager, together with PPET announcements and contact details, can also be found on the website.   Feedback: The Board encourages shareholder feedback and invites shareholders to write to the Board at its registered office. The Board has also set up an email account to encourage shareholders to write directly to the Board. Shareholders are invited to email any feedback or questions to the Board at [email protected]. Either the Manager or Board via the Company Secretary will reply to any questions received.
Our Manager The Manager's performance is critical for PPET to successfully deliver its investment objective and achieve long-term returns for shareholders.	Maintaining a close and constructive relationship with the Manager is crucial for the Board in supporting the delivery of the Company's investment objective. The Board is in regular contact with the Manager and adopts a supportive, yet challenging, approach to the relationship to ensure the best outcome for shareholders.   Regular meetings: the Board meets with the Manager formally at least five times per year and more regularly as necessary. The Board and its Committees were particularly active during the financial year. The Board encourages the Manager to speak candidly and freely on all issues affecting the Company.   Informal meetings: the Chair of the Board meets informally with the Manager regularly to consider emerging issues for the Company. The Manager also reports on changes within the investment trust industry, which may be of interest to the Board.   Strategy meeting: each year, the Board and Manager hold a strategy meeting at which the Company's investment objective and investment policy are discussed in detail to determine whether they remain appropriate for future long-term growth.
Service Providers Engaging with reputable and experienced providers allows PPET to maintain its premium listing on the London Stock Exchange.	As an investment trust, PPET has outsourced its operations to third-party suppliers. In addition to the Manager, PPET appoints an Administrator, Company Secretary, Registrar, Depositary and Broker.   The Board acknowledges that PPET's long-term success is dependent upon the performance of its third-party service providers. The Board and Committees receive regular reports from its key third-party service providers and seeks views, advice and counsel from each of them outside of meetings as necessary.   The Board regularly reviews the performance of PPET's service providers and, through the Management Engagement Committee, formally reviews their performance and contractual arrangements to ensure that performance standards are met and contractual terms remain appropriate and competitive. The Board has the ability to change providers if they are not meeting the Board's expectations. The Audit Committee considers the internal controls of key service providers to ensure that they are appropriate and fit for purpose, especially when hosting PPET's data.
Debt Providers Availability of funding is important to allow PPET to take advantage of investment opportunities as they arise.	The Board regularly reviews the adequacy of the Company's loan facility with reference to its costs and the size of the facility relative to the size of the Company's net assets.   The Manager acts as the main point of contact for PPET's lenders. On behalf of the Board, the Manager maintains an open and transparent relationship with the Company's lenders, providing regular business updates and compliance with loan covenants. The Board is responsible for the Company's gearing strategy and regularly monitors cash flows and the reliance upon the facility agreement.   As reported in the Chair's Statement, PPET increased its revolving credit facility, with effect from 3 February 2025. The revolving credit facility, which matures in February 2028, increased from £300.0 million to £400.0 million. The Board was pleased with the continued support from RBSI, Société Générale and State Street, and was delighted to welcome Banco Santander to the syndicate.
Private Equity Managers and Portfolio Companies PPET has identified a core group of private equity managers through which its portfolio has been built.	The Board has delegated day-to day-management of the portfolio to the Manager. However, the Board provides strategic oversight of the Manager's compliance with PPET's investment policy and its engagement with the underlying investees in the Company's portfolio.   On behalf of the Board and its stakeholders, the Manager invests alongside a carefully selected range of private equity managers, built from years of established relationships and proprietary research. The Manager assesses all investment opportunities and participates on the advisory boards of some investments.   The Manager reports to the Board regularly on its dialogue with the Company's underlying and potential investments. From time to time, the Board will invite core private equity managers to present to the Board.
Environment and Society The Board and Manager are fully committed to managing the business and its investment strategy responsibly.	The Board believes that integrating ESG best practice into PPET's strategy and investment processes will help support the Company's investment objective by generating stronger, more sustainable returns for shareholders over the longer term.   The Board monitors the Manager's commitment to ESG factors closely and encourages it to stay close to the latest market developments. The Board takes comfort from the Manager's policy to invest with private equity managers who have advanced ESG approaches or have a strong cultural commitment to improve their ESG credentials. The Manager's assessment is based on investment due diligence and ongoing ESG engagement through initiatives like the Manager's annual ESG survey.   ESG has been embedded into the Manager's investment process since 2015 and every new investment made by PPET in recent years has been subject to specific ESG due diligence.

 

Sale of PPET's Investment Manager to Patria - s172 spotlight

During the financial year, the Board spent a significant amount of time discussing the impact of the sale of abrdn plc's European-headquartered private equity business, which included PPET's Manager, to Patria ('the Transaction').

 

The Board undertook an extensive due diligence exercise on the Transaction and the impact on the Company's shareholders and service providers, and the Manager's employees servicing PPET. The Board held fortnightly due diligence meetings with the Manager, supported by the Company's legal advisers, to ensure that each of the operational and regulatory services previously provided by the abrdn infrastructure would be

seamlessly transferred to Patria.

 

During deliberations, the Board considered the long-term impact of the Transaction on the Company and its various

stakeholders.

 

·	Shareholders - The Board received assurances that the Transaction would be cost-neutral for the Company. There were no additional costs borne by PPET's shareholders as a result of the Transaction. The Board also engaged with the Company's largest shareholders to understand their attitudes towards the Transaction.
·	Manager - The Board received assurances from Patria that there would be no change to the personnel managing PPET. The team managing PPET, as well as employees providing support to PPET across Company Secretariat, Fund Operations and Marketing, transitioned smoothly from abrdn to Patria.
·	Service providers - There was no negative impact on the Company's other service providers during the Transaction. The Board received assurances that each of the Company's other service providers did not object to the Transaction. Where the Manager was a party to any of the service providers, third-party contracts, these were successfully novated to Patria.
·	Debt providers - Each of the Company's debt providers were engaged during negotiations and provided confirmation that they did not have any objections to the Transaction.
·	Private equity managers and portfolio companies - There was no negative impact on the Company's private equity managers and portfolio companies. Communications to the Company's underlying portfolio entities were managed by the Manager on behalf of the Board - there was no changes to the portfolio as a result of the Transaction.
·	Environment and society - The Board acknowledged that Patria Investments Limited, as the new owner of the Manager, was committed to maintaining its local presence in Edinburgh, creating certainty for the Manager's employees and investing in the local community. Patria has identified office premises within Edinburgh City Centre and is bolstering operations within Edinburgh.

 

Other Important Decisions Taken by the Board During the Financial Year

 

·

Introduction of share buyback programme: During the financial year, the Board was aware that, like many of its peers, PPET's share price had diverged materially from its NAV, resulting in the Company's shares trading at material discount, in excess of its long-term average, for a period in excess of 18 months. The Board agreed that the share price presented an exceptional investment opportunity for the Company and agreed with the Manager that it was a compelling use of the Company's capital. The Board also agreed that a share buyback would provide immediate NAV accretion to PPET's shareholders. The Board believes that the action highlighted, in the clearest terms, the disconnect between PPET's share price and the valuation of the underlying portfolio.

·

Dividend: PPET's dividend has increased in value every year for the last ten years and since 2016, the Company has paid shareholders an enhanced dividend on a quarterly basis, with the aim of maintaining the value of the dividend in real terms. Whilst the Board intends to continue this policy going forward, the level of dividend is discussed and debated each year. The Board has committed to pay four interim dividends of 4.2 pence per share taking the total dividend for the financial year to 30 September 2024 of 16.8 pence per share, a 5% increase on the total dividend of 16.0 pence per share during the financial year to 30 September 2023. The Board considers that the dividend policy is effectively an ongoing return of capital to shareholders at NAV. The dividend approach is also a differentiator for the Company and the Board considers that it may be attractive to prospective shareholders.

 

Board Diversity

The Board's statement on diversity is set out in the Statement of Corporate Governance. At 30 September 2024, there were three male and two female Directors on the Board.

 

Modern Slavery Act

As the Company does not offer goods and services to customers and has no turnover, the Board considers that PPET is not within the scope of the Modern Slavery Act 2015. PPET is therefore not required to make a slavery and human trafficking statement. However, notwithstanding that, the Board considers PPET's supply chains, dealing predominantly with professional advisers and service providers in the financial services industry in the United Kingdom, to be low risk in relation to this matter.

 

Streamlined Energy and Carbon Reporting ("SECR") Statement: Greenhouse Gas Emissions and Energy Consumption Disclosure

PPET's activities are outsourced to third parties. It has no employees, premises or operations either as a producer or provider of goods and services. Therefore, it is not required to disclose energy and carbon information as there are zero emissions associated or attributed to the Company and no underlying global energy consumption.

 

Viability Statement

The Board has decided that five years is an appropriate period over which to consider PPET's viability. The Board considers this to be an appropriate period for an investment trust company with a portfolio of private equity investments and the financial position of the Company.

 

In determining this time period, the Directors considered the nature of PPET's commitments and its associated cash flows. The Manager presents the Board with a comprehensive review of PPET's detailed cash-flow model on a regular basis, including projections for up to five years ahead. This analysis takes account of the most-up to-date information provided by the underlying private equity managers, together with the Manager's current expectations in terms of market activity and performance.

 

The Directors have also carried out an assessment of the principal risks and discussed in Note 18 to the Financial Statements that are facing PPET over the period of the review. These include those that would threaten its business model, future performance, solvency or liquidity such as over-commitment, liquidity and market risks. When considering the risks, the Board reviewed the impact of stress testing on the portfolio, including multiple downside scenarios which modelled a reduction in forecast distributions from 50% to 100% in an extreme downside case and the impact this would have on liquidity and deployment. Under an extreme downside scenario which involved: i) a 100% reduction in forecast distributions over a 12-month period; ii) all underlying fund debt facilities being drawn simultaneously; and iii) a 25% reduction in portfolio valuations spread over a period of 12 months, a significant adjustment to planned new investment deployment would be required to maintain sufficient liquid resources over the financial year to 30 September 2025 and over the period through to December 2025. From December 2025 onwards, the implied resumption of forecast distribution activity then provides sufficient liquidity in this extreme downside scenario.

 

By having a portfolio of predominantly fund investments, diversified by manager, vintage year, sector and geography and by monitoring PPET's cash flows together with the Manager, the Directors believe PPET is able to withstand economic cycles. The Directors are also aware of PPET's indirect exposure to ongoing risks through underlying funds.

 

These risks are continually assessed via the Manager's ongoing portfolio monitoring of both the underlying private equity managers and portfolio companies. The Manager regularly communicates with the underlying private equity managers and participates on a number of fund advisory boards.

 

Based on the results of this analysis and the ongoing ability to adjust the portfolio, the Directors have a reasonable expectation that PPET will be able to continue in operation and meet its liabilities as they fall due over the five- year period following the date of this report.

 

Future Strategy

Although the Board has recommended amendments to the Company's investment objective and policy, the Board intends to maintain the policies set out in the Strategic Report for the year ending 30 September 2025 as it believes that these are in the best interests of shareholders.

 

Long-Term Investment

The Manager's investment process seeks to outperform its comparator index over the longer term. The Board has in place the necessary procedures and processes to continue to promote PPET's long-term success. The Board will continue to monitor, evaluate and seek to improve these processes as PPET continues to grow over time, to ensure that the investment proposition is delivered to shareholders and other stakeholders in line with their expectations.

 

On behalf of the Board

Alan Devine

Chair

29 January 2025

PRINCIPAL RISKS AND UNCERTAINTIES

 

The Board is responsible for PPET's risk management and internal control systems.

 

Through the Audit Committee, the Board carries out regular and robust reviews of the risk environment in which PPET operates. During discussions, the Board also considers and identifies emerging risks which could impact PPET in the future, such as material changes in the geopolitical or macroeconomic environment. These could impact PPET or its underlying investments, attitudes towards listed equities and the listed private equity investment trust sector or developments in climate change from an investor attitude or regulatory expectation.

 

There are a number of risks which, if realised, could have a material adverse effect on PPET and its financial condition, performance and prospects, which the Board considers to be principal risks. The Board considers its risk appetite in relation to each principal risk and monitors the potential impact and risk mitigation on an ongoing basis. Where a risk is approaching or is outside the tolerance level, the Board and Manager will take action to manage the risk. Currently, the Board considers the risks to be managed within acceptable levels.

 

The principal risks faced by PPET relate to the Company's investment activities and these are set out in the following table.

Risk				Tolerance	Mitigation / Update	Direction of Travel
Valuation Risk		PPET is at risk of the economic cycle impacting listed financial markets and hence potentially affecting the valuation of underlying investments and timing of exits.		Medium	Public markets have been relatively stable during 2024, which has impacted the valuation of the PPET portfolio. Investments in PPET's portfolio are all subject to private equity guidelines such as IPEV Guidelines with respect of valuations. Furthermore, they are predominantly in line with either IFRS or US GAAP accounting standards.   The Manager has a formal governance process around valuations. Quarterly valuations are subject to review and challenge by the Manager's Valuation Committee and the outputs from those meetings are reported to the Audit Committee. The Company's Auditors attend the year end Valuation Committee and did not identify any material judgements to the Manager's valuations of PPET's underlying valuations.   Private equity investment activity has steadily increased over the course of 2024. On 30 September 2024, PPET undertook a secondary sale of 14 underlying fund investments which achieved pricing of 95% on 31 March 2024 valuations.   The Manager currently expects private equity investment activity to continue its recovery in 2025 but has contingency plans in case the exit environment worsens again and, subsequent to the financial year, PPET increased the size of its revolving credit facility to £400.0 million.	Unchanged
Currency		A material proportion of PPET's investments and cash balances are held in currencies other than Sterling. PPET is therefore sensitive to movements in foreign exchange rates.		Medium	The Manager monitors PPET's exposure to foreign currencies and reports to the Board on a regular basis. Its non-Sterling currency exposure is primarily to the Euro and the US Dollar. PPET does not hedge foreign currency risk.   During the year ended 30 September 2024, Sterling appreciated by 4.3% relative to the Euro (2023: appreciated 1.2%) and appreciated by 9.9% relative to the US Dollar (2023: appreciated 9.3%). This movement in the Euro and the US Dollar had a net negative impact on PPET's net assets during 2024.	Unchanged
Over-commitment		PPET is unable to settle outstanding commitments to fund investments.		Medium	PPET makes commitments to private equity funds, which are typically drawn over three to five years. Hence, PPET will tolerate a degree of over-commitment risk in order to make the most efficient use of PPET's resources and deliver long-term investment performance.   In order to mitigate this risk, the Board has instructed the Manager to maintain appropriate levels of resources, whether through cash and cash equivalents or the revolving credit facility, relative to the levels of over-commitment.   The Manager also forecasts and assesses the maturity of the underlying portfolio to determine likely levels of distributions in the near term.   The Manager also tracks PPET's over-commitment ratio, and takes action as necessary, to ensure that it sits within the range, agreed with the Board, of 30% to 75% over the long term.   At 30 September 2024, PPET had £652.7 million (2023:  £651.9 million) of outstanding commitments, with £83.5 million (2023: £94.3 million) expected not to be drawn. The over-commitment ratio was 28.5% (2023: 35.2%).	Unchanged
Investment selection		The Manager makes decisions to invest in funds and/or direct investments that are not accretive to PPET's NAV over the long term.		Medium	The Manager undertakes detailed due diligence prior to investing in, or divesting, any fund or direct investment. It has an experienced team which monitors market activity closely. PPET's management team has long-established relationships with the 15 core managers in the Company's portfolio, which have been built up over many years. ESG factors are integrated into the investment selection process and the Board and the Manager believes that will improve investment decision-making and help to generate stronger, more sustainable returns.   The Manager's senior investment team has remained stable over the last five years, with no departures, and its Investment Committee composition has also been consistent during this period.	Unchanged
Climate		Climate change impacts PPET's portfolio, either from a physical or transition point of view.		Medium	PPET is committed to being an active, long-term responsible investor - sustainability and ESG is a fundamental component of its Manager's investment process.   PPET's capital is invested with or alongside core private equity managers who demonstrate strong adherence to ESG principles and processes or have a cultural commitment to improve their ESG credentials. Focus on climate change is part of that assessment.   The Board acknowledges that the private equity industry is still relatively early in its response to climate change and the Manager is focused on engaging with its portfolio of private equity managers to help promote further positive change.	Increased
Liquidity		PPET is unable to meet short-term financial demands.		Low	PPET manages its liquid investments to ensure that sufficient cash is available to meet contractual commitments and also seeks to have cash available to meet other short-term needs. Additional short-term flexibility is achieved through the use of its revolving multi-currency loan facility.   PPET had cash and cash equivalents of £28.4 million (2023: £9.4 million) and £159.4 million (2023: £197.7 million) available on its revolving credit facility as at 30 September 2024.   Following period-end, PPET increased the size of its revolving credit facility to £400.0 million and extended its maturity to February 2028.   During September 2024, PPET agreed to sell a portfolio of 14 fund investments in a secondary transaction resulting in deferred consideration of £157.2m at transaction close, receivable in three contractual payments with the first payment received in December 2024, the second in January 2025 and the final payment due in September 2025.	Decreased
Credit		The exposure to loss from failure of a counterparty to deliver securities or cash for acquisitions or disposals of investments or to repay deposits.		Low	PPET places funds with authorised deposit takers from time to time and, therefore, is potentially at risk from the failure of such an institution.   PPET's cash is held by BNP Paribas Securities Services SA, which is rated A+ by Standard and Poor's Global Ratings.   The credit quality of the counterparties is kept under regular review. Should the credit quality or the financial position of these financial institutions deteriorate significantly, the Manager would move cash balances to other institutions.	Unchanged
Operational		The risk of loss or a missed opportunity resulting from a regulatory failure or a failure relating to people, processes or systems.		Low	The Manager's business continuity plans, and approach to cybersecurity risk, are reviewed on an ongoing basis alongside those of PPET's key service providers.   The Board has received reports from its key service providers setting out their existing business continuity framework. Having considered these arrangements, the Board is confident that a good level of service will be maintained in the event of an interruption to business operations or other major events, and this was well-tested during the global pandemic in 2020/21.   This risk increased during the period, due to the Manager's change of ownership (to Patria in 2024 and the potential risks associated with a change of ownership), but there have been no impacts on the Company and its operations.   The operational risk of the Manager's change of ownership was further mitigated by the transfer of the Manager's investment and operational teams. There has been no material change to the personnel servicing PPET from a management, company secretarial, marketing and operational perspective following the transfer to Patria.	Increased

 

PPET's financial risk management objectives and policies are contained in Note 18 to the Financial Statements.

 

EXTRACT OF DIRECTORS' REPORT / CORPORATE GOVERNANCE STATEMENT

 

The Directors present their report and the audited Financial Statements of the Company for the year ended 30 September 2024.

 

The Directors consider that the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable, and provides the information necessary for shareholders to assess the Company's position and performance, business model and strategy.

 

Directors

Each of the Directors as at 30 September 2024, whose biographies are shown in the Annual Report and on the Company's website, is considered to be independent of PPET and the Manager. PPET is not aware of any potential conflicts of interest between any duty owned to it by any of the Directors and their respective private interests.

 

At 30 September 2024, there were three male and two female Directors on the Board. Subsequent to the year-end, the Board announced the appointment of Duncan Budge as an additional Non-executive Director with effect from 1 February 2025.

 

All of the Directors will retire and stand for election or re-election at the Company's AGM on 25 March 2025.

 

Results and Dividends

The Financial Statements for the year ended 30 September 2024 are contained below.

 

Interim dividends of 4.2 pence per share were paid in April, July and October 2024. In December 2024, the Board declared a fourth interim dividend of 4.2 pence per share paid in January 2025, taking the total dividend for the financial year to 30 September 2024 to 16.8 pence per share. This is a 5% increase on the 16.0 pence per share paid for the financial year to 30 September 2023.

 

Interim dividends of 4.2 pence per share were paid in April, July and October 2024. In December 2024, the Board declared a fourth interim dividend of 4.2 pence per share paid on 24 January 2025, taking the total dividend for the financial year to 30 September 2024 to 16.8 pence per share. This is a 5% increase on the 16.0 pence per share paid for the financial year to 30 September 2023.

 

Principal Activity and Status

PPET was incorporated in Scotland on 9 March 2001 as a public limited company with company number SC216638. It is an investment company within the meaning of section 833 of the Companies Act 2006 and carries on business as an investment trust.

 

PPET has applied for and has been accepted as an investment trust under sections 1158 and 1159 of the Corporation Tax Act 2010 and Part 2 Chapter 1 of Statutory Instrument 2011/2999. This approval relates to accounting periods commencing on or after 1 October 2012. The Directors believe that the Company has conducted its affairs so as to be able to retain such approval.

 

The Company intends to manage its affairs so that its shares continue to be a qualifying investment for inclusion in the stocks and shares component of an individual savings account ('ISA').

 

Capital Structure and Voting Rights

The rights attached to the Company's shares are set out in the Company's Articles of Association.

 

At the AGM on 27 March 2024, the Directors were given authority to allot shares, disapply pre-emption rights and buy back shares. These authorities will expire at the forthcoming AGM. Relying on this authority and in order to take advantage of the investment opportunity offered by the discount to NAV on the Company's share price, the Company bought back 940,128 Ordinary Shares into treasury representing 0.6% of the Company's issued share capital.

 

As at 30 September 2024, the Company's issued share capital comprised of 153,746,294 Ordinary Shares of 0.2 pence each (2023: 153,746,294). Of those shares, 152,806,166 Ordinary Shares were in issue and 940,128 were held in treasury (2023: nil). At general meetings, each ordinary shareholder is entitled to one vote on a show of hands and, on a poll, to one vote for every Ordinary Share held.

 

There are no restrictions on the transfer of Ordinary Shares in the Company issued by the Company other than certain restrictions, which may from time to time be imposed by law. The Company is not aware of any agreements between shareholders that may result in a transfer of securities and/or voting rights.

 

The Company's Manager

Patria Capital Partners LLP (formerly abrdn Capital Partners LLP), a wholly owned subsidiary of Patria Investments Limited has been appointed as the Company's AIFM and Manager.

 

The Manager charges a management fee, payable quarterly, at 0.95% per annum of the Company's NAV at the end of the relative quarter. The Manager is not entitled to a performance fee. No fee is payable on any investments in any investment trust, collective investment scheme or any other company or fund managed, operated or advised by the Manager or any other subsidiary of Patria where there is an entitlement to a fee on that investment.

 

Further details of the fees payable to the Manager are shown in Notes 3 and 4 to the Financial Statements.

 

The management agreement is terminable on not less than 12 months' written notice.

 

Other Service Providers and Advisers

The Board has appointed a number of other service providers and advisers to support it in the delivery of its investment objective.

 

The Company entered into the contracts with each service provider after full and proper consideration by the Board of the quality and cost of services. The performance of each service provider and adviser is reviewed regularly, and subject to formal annual review by the Management Engagement Committee.

 

Shareholders and Substantial Interests

The table that follows shows the interests of major shareholders based on the best available information provided by analysis of the Company's share register, also incorporating any disclosures provided to the Company in accordance with Disclosure Guidance and Transparency Rule 5 in the period under review and up to 31 December 2024.

 

Shareholder	% of voting rights at 30 September 2024	% of voting rights at 31 December 2024
Phoenix Life Limited	53.91	54.26
Interactive Investor	4.58	4.54
Hargreaves Lansdown, stockbrokers	3.61	3.35
Oxfordshire County Council Pension Fund	3.40	3.45

 

Our Relationship with Phoenix

The Standard Life Assurance Company ('Standard Life') originally listed PPET on the London Stock Exchange in 2001. At that time, PPET was known as Standard Life European Private Equity Trust plc ('SLEPET').

 

At launch of the Company, Standard Life transferred 19 of its European private equity funds interests, with a valuation of £80.7 million to PPET (then called SLEPET). In return, Standard Life was allotted 50.5% of the Company's share capital and voting rights. At that time, Standard Life and SLEPET entered into a relationship agreement pursuant to which, it was agreed, amongst other things, that Standard Life would be permitted to increase its shareholding in the Company without making a general offer for the shares it does not own in accordance with the Takeover Code.

 

Following various affiliate transfers and the sale of the Standard Life business to Phoenix Group in 2018, Standard Life's holding in the Company was transferred to Phoenix Life Limited. Phoenix Life Limited ('PLL') is the Company's largest shareholder. 

 

Pursuant to the relationship agreement, which remains in force, PLL has irrevocably undertaken to the Company that, at any time when PLL and its Associates (meaning any company which is a member of the PLL group) are entitled to exercise or control 30% or more of the rights to vote at general meetings of the Company, it will not (and will procure that none of its Associates will) seek to nominate Directors to the Board of the Company who are not independent of PLL and its Associates, enter into any transaction or arrangement with the Company which is not conducted at arm's length and on normal commercial terms, take any action that would have the effect of preventing the Company from carrying on an independent business as its main activity or from complying with its obligations under the Listing Rules or propose or procure the proposal of any shareholder resolution which is intended or appears to be intended to circumvent the proper application of the Listing Rules.

 

The Board and Manager have a positive relationship with Phoenix and regularly communicate with Phoenix regarding PPET. Aside from PPET, Patria also manages other private equity investments on Phoenix's behalf.

 

Role of the Board

The Board is responsible for the strategic oversight of the Company on behalf of the shareholders. It is PPET's decision-making body and represents the interests of PPET's shareholders. There are a number of matters reserved for the Board's approval, which include overall strategy, investment objective and policy, borrowings, buybacks, dividend policy and Board composition.

 

The Board meets at least five times per year and more often as business dictates. In the event that any Directors are unable to attend Board and Committee meetings, the relevant Directors will be contacted by the Chair and Company Secretary before and/or after the meeting to ensure they were aware of the issues being discussed and to obtain their input.

 

The Board meetings follow a formal agenda, which is approved by the Chair and circulated by the Company Secretary in advance of the meeting to all the Directors and other attendees.

 

A typical Board agenda includes:

 

·	a review of investment performance and new investment activity;
·	an update on the pipeline of investment activity and asset management initiatives;.
·	consideration of PPET's capital deployment, its debt facility, balance sheet and liquidity; cash flow and capital management;
·	review of conflicts of interest;
·	update on marketing and shareholder relations;
·	presentation from PPET's broker on capital market activity;
·	review of peer group analysis; and
·	regulatory, compliance, corporate governance and industry updates.

 

Board papers are typically circulated at least one week in advance of each Board meeting via a secure online platform. Minutes are maintained of every Board meeting and the Company Secretary is responsible for tracking actions arising from discussions.

 

Directors

The Board holds at least five Board meetings per year, at least four Audit Committee meetings per year, at least one Nomination Committee meeting and at least one Management Engagement Committee meeting per year. Directors' attendance at scheduled Board and Committee meetings is set out below.

 

	Board meetings	Audit Committee meetings	Management Engagement and Nomination Committee meetings	Nomination Committee meetings
Dugald Agble1	5 (5)	4 (4)	1 (1)	1 (1)
Alan Devine2	5 (5)	0 (0)	0 (0)	0 (0)
Diane Seymour-Williams	5 (5)	5 (5)	1 (1)	1 (1)
Yvonne Stillhart	5 (5)	5 (5)	1 (1)	1 (1)
Calum Thomson	5 (5)	5 (5)	1 (1)	1 (1)

 

2 The Board Chair is not a member of the Board Committees.  He stepped down as a member on 28 May 2023.

 

Given the matters to be considered by the Board and Committees during the financial year, the Board and Committees met in excess of 30 times during the financial year. In addition to the regular business, the Board and Committees met to consider the Manager's change of control, the Company's share buyback programme, activity in the Company's underlying portfolio, the Company's level of dividend, Board succession planning and the appointment of the Company's new corporate broker, amongst other items.

 

The Board, as a whole, seeks to ensure that it is appropriately balanced by skills, experience, tenure, expertise and diversity. The Directors possess a wide range of business and financial experience, which enable the Board to provide clear and effective leadership and governance of the Company. Each Director commits sufficient time to fulfil their duties.

 

The Board, led by the Nomination Committee, follows a formal process for the appointment of Non-executive Directors. The appointment of new Directors is always made on the basis of merits and the skills/experience identified by the Board as being desirable to complement the existing skillset on the Board. The Board recognises the benefits and is supportive of diversity in its recruitment of new Board members. The Board will not display any bias for age, gender, race, sexual orientation, religion, ethnic or national origins, or disability.

 

A formal induction programme is established for each new Director, which involves the provision of a full induction pack containing relevant information about the Company. New Directors are invited to meet with members of the Company's management team, finance team, marketing team and Company Secretary, and other members of the PPET team. New Directors also have the opportunity to meet with the Company's other service providers and, where appropriate, shareholders.

 

The terms and conditions of the appointment of the Non-executive Directors are set out in letters of appointment. The terms and conditions of appointment of the Nonexecutive Directors will be available for inspection at the AGM, and at the Company's registered office. No Director has a service contract with the Company.

 

The Board believes that each Director has the requisite high level and range of business, investment and financial experience, which enables the Board to provide clear and effective leadership and proper governance of the Company. Each Director remains independent and free from any relationship which could materially interfere with the exercise of their judgement on issues of strategy, performance, resources and standards of conduct.

 

The Board subscribes to the view that independence of an individual Director is not necessarily compromised by length of tenure on the Board, and that continuity and experience can add significantly to the Board's strength. Following formal performance evaluations, the Board believes that each of the Directors is independent in character and judgement, and that there are no relationships or circumstances which are likely to affect their judgement.

 

All of the Directors will retire and, being eligible, will offer themselves for election or re-election at the AGM in March 2025. The terms and conditions of appointment of the Non-executive Directors will be available for inspection at the AGM.

 

The Board therefore recommends the re-election of each of the Directors at the AGM.

 

Board Evaluation

The Board has a formal process for the annual evaluation of the performance of the Board as a whole, its Committees and the individual Directors. In 2024, the Board instructed Lintstock Ltd to conduct an external review of its performance. Lintstock is an advisory firm that specialises in Board reviews and has no other connection with the Company or individual Directors.

 

Lintstock collaborated with PPET to tailor the line of enquiry to the specific needs of the Company.

 

Board members then completed bespoke surveys assessing the performance of the Board and Committees, Chair and Manager, alongside a self-assessment questionnaire addressing their own individual performance. Lintstock analysed the findings from the surveys and delivered focused reports, including a number of recommendations to increase effectiveness. The findings were presented to the Board, following which actions were agreed for implementation and monitoring.

 

Lintstock found that the PPET Board engaged well with the Board review process. The exercise had a particular focus on the impact of the Manager's change of control, from abrdn to Patria, and the overall findings of the Review were positive, with areas including the management of meetings and the relationships between Board members recognised as particular strengths. The Review also identified a few key priorities for 2025, including Board member succession planning.

 

As part of the review, Lintstock provided an analysis of PPET relative to the Lintstock Governance Index, which comprises around30 core Board performance metrics from over100 Board reviews that Lintstock has recently facilitated, specifically for UK investment companies. This helped the Directors to understand how the PPET Board compares with other organisations, putting the findings into context.

 

The review of the individual Directors concluded that each Director's performance continues to be effective. Each Board Director demonstrates commitment to their role and their individual performances contribute to the long-term sustainable success of the Company.

 

Board Tenure

The Board does not consider that a Director's independence is necessarily compromised by length of tenure on the Board. The Board's tenure policy seeks to ensure that the Board remains well-balanced by skills and experience, and time served on the Board.

 

Whilst the Board believes that the Directors should be refreshed regularly and Directors should not generally serve beyond the AGM following the ninth anniversary of their appointments, there may be circumstances in which is appropriate for Directors to serve beyond this term such as to facilitate effective succession planning or the development of a diverse Board. In such a situation, the reason for the extension will be fully explained to shareholders.

 

It is the Board's policy that each Director stands for election or re-election at each AGM. The Board's recommendation for election or re-election at the AGM is made on an individual basis following a rigorous review of each individual Director and their contribution.

 

As set out in the Chair's Statement, the Board has asked that Alan Devine remain on the Board for a further year and recommends his re-election to shareholders. Alan Devine has been asked to remain on the Board beyond his nine-year term to allow a smooth transition of chair responsibilities to his successor. Assuming shareholders approve Alan Devine's re-election at the AGM in March 2025, Alan Devine will step down from the Board at the AGM in March 2026.

 

Board Diversity

The Board recognises the importance of having a range of skilled, experienced individuals with appropriate knowledge represented on the Board in order to allow it to fulfil its obligations. The Board also recognises the benefits and is supportive of the principle of diversity in its recruitment of new Board members and has taken into account the Hampton-Alexander Review and the Parker Review.

 

The Board will not display any bias for age, gender, race, sexual orientation, religion, ethnic or national origins, or disability in considering the appointment of its Directors. In view of its size, the Board will continue to ensure that all appointments are made on the basis of merit against the specification prepared for each appointment. The Board does not therefore consider it appropriate to set measurable objectives in relation to its diversity.

 

However, the Board will take account of the diversity targets set out in the FCA's Listing Rules.  The Board voluntarily discloses the following information in relation to its diversity. As an externally managed investment company, the Board employs no executive staff and therefore does not have a CEO or a Chief Financial Officer, both of which are deemed senior Board positions by the FCA. Other senior Board positions recognised by the FCA are Chair of the Board and Senior Independent Director ('SID'). In addition, the Board has resolved that the Company's year-end date be the most appropriate date for disclosure purposes.

 

The following information has been provided by each Director. There have been no changes since 30 September 2024.

 

	Number of Board members	Percentage of the Board	Number of senior positions on the Board
Men	3	60	2
Women	2	401	0

 

1 Meets the target that at least 40% of Directors are women as set out in UKLR 14.3.30R.

 

	Number of Board members	Percentage of the Board	Number of senior positions on the Board
White British or other White (including minority-white groups)	4	80	2
Black/African/Caribbean/Black British	1	201	0

 

1 Meets the target that at least one individual on the Board is from a minority background as set out in UKLR 14.3.30R.

 

Role of the Chair

Alan Devine is the Chair of the Board. He was appointed to the Board on 28 May 2014 and assumed the role of Chair on 22 March 2022.

 

The Chair is responsible for providing effective leadership to the Board by setting the tone of the Company, demonstrating objective judgement and promoting a culture of openness and debate. The Chair facilitates the effective contribution of and encourages active engagement by each Director. In conjunction with the Company Secretary, the Chair ensures that Directors receive accurate, timely and clear information to assist them with effective decision-making. The Chair leads and acts upon the results of the formal and rigorous annual Board and Committee evaluation process by recognising strengths and addressing any weaknesses of the Board. He also ensures that the Board engages with major shareholders and that all Directors understand shareholder views.

 

Role of the Senior Independent Director

Calum Thomson is the SID. He was appointed to the Board on 30 November 2017 and assumed the role as SID on 22 March 2022.

 

The SID acts as a sounding board for the Chair and acts as an intermediary for other Directors, when necessary. Working closely with the Chair of the Nomination Committee, the SID leads the annual appraisal of the Chair's performance. The SID is also available to shareholders to discuss any concerns they may have.

 

Directors' and Officers' Liability Insurance

The Company maintains insurance in respect of Directors' and officers' liabilities in relation to their acts on behalf of the Company. The Company's Articles of Association provide that any Director or other officer of the Company is to be indemnified out of the assets of the Company against any liability incurred by him as a Director or other officer of the Company to the extent permitted by law.

 

Management of Conflicts of Interest

The Board has a procedure in place to deal with a situation where a Director has a conflict of interest. As part of this process, each Director discloses other positions held and all other conflict situations that may need to be authorised either in relation to the Director concerned or his or her connected persons. The Board considers each Director's situation and decides whether to approve any conflict or other external positions, taking into consideration what is in the best interests of the Company and whether the Director's ability to act in accordance with his or her wider duties is affected.

 

Each Director is required to notify the Company Secretary of any potential, or actual, conflict situations that will need authorising by the Board. Authorisations given by the Board are reviewed at each Board meeting. No Director has a service contract with the Company, although all Directors are issued with letters of appointment. There were no contracts during, or at the end of the year, in which any Director was interested.

 

The Company has a policy of conducting its business in an honest and ethical manner. The Company takes a zero-tolerance approach to bribery and corruption, and has procedures in place that are proportionate to the Company's circumstances to prevent them. The Manager also adopts a Group-wide zero-tolerance approach and has its own detailed policy and procedures in place to prevent bribery and corruption. Copies of the Manager's antibribery and corruption policies are available on its website.

 

In relation to the corporate offence of failing to prevent tax evasion, it is the Company's policy to conduct all business in an honest and ethical manner. The Company takes a zero-tolerance approach to facilitation of tax evasion whether under UK law or under the law of any foreign country and is committed to acting professionally, fairly and with integrity in all its business dealings and relationships.

 

Financial Risk Management

The principal risks and uncertainties facing the Company are set out above. The principal financial risks and the Company's policies for managing these risks are set out in note 18 to the financial statements.

 

Corporate Governance Report

I am pleased to introduce this year's Corporate Governance Statement. In this statement, the Company reports on its compliance with the 2019 AIC Code of Corporate Governance ('the AIC Code') and sets out how the Board has operated during the year. The AIC Code, published in 2019, is intended to provide a framework of best practice in respect of the governance of investment companies. Next year, the Company will report on its compliance with the new 2024 AIC Corporate Governance Code ('the New Code'), which applies to accounting periods beginning on or after 1 January 2025. The Board has reviewed the impact of the New Code and, where necessary, has commenced preparations to be able to report on compliance.

 

Patria Private Equity Trust plc is committed to high standards of corporate governance and the Board has considered and applied the principles and provisions of the AIC Code. The AIC Code addresses the principles and provisions 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 Patria Private Equity Trust plc.

 

The Board considers that reporting against the principles and provisions of the AIC Code, which has been endorsed by the Financial Reporting Council, provides more relevant information to shareholders.

 

The AIC Code is available on the AIC website (theaic.co.uk). It includes an explanation of how the AIC Code adapts the principles and provisions set out in the UK Code to make them relevant for investment companies.

 

The Company has complied throughout the year with the principles and provisions of the AIC Code. The Board attaches great importance to the matters set out in the UK Code and strives to apply its principles in a manner that would enable shareholders to evaluate how the principles have been applied.

 

However, it should be noted that where the principles and provisions are related to the role of the Chief Executive, Executive Directors' remuneration and the establishment of a Remuneration Committee, the Board considers these principles and provisions not relevant as Patria Private Equity Trust is an externally managed Company with an entirely Non-executive Board, and with no employees or internal operations.

 

The AIC Code is made up of 17 principles split into five sections covering:

 

·	board leadership and purpose;
·	division of responsibilities;
·	composition, succession and evaluation;
·	audit, risk and internal control; and
·	remuneration.

 

Details of how the Company has applied the principles of the AIC Code are set out in this report.

 

Board Committees

The Board has appointed a number of Committees, as set out below. Copies of their terms of reference, which clearly define the responsibilities and duties of each Committee, are available on the Company's website or upon request from the Company.

 

The performance of the Committees and their terms of reference are reviewed by the Board on an ongoing basis and formally at least annually.

 

Audit Committee

The Audit Committee is chaired by Calum Thomson, who is a Chartered Accountant, and has recent and relevant financial experience. The Committee comprises all Non-executive Directors, except Alan Devine who stepped down as a member on 28 May 2023, the ninth anniversary of his appointment as a Board Director. The Board is satisfied that the Committee as a whole has competence relevant to the investment trust sector.

 

The Audit Committee's Report is contained in the Annual Report

 

Management Engagement Committee

The Management Engagement Committee is chaired by Yvonne Stillhart. The Committee comprises all Non-executive Directors except Alan Devine who stepped down as a member on 28 May 2023, the ninth anniversary of his appointment as a Board Director.

 

The main responsibilities of the Committee include:

·	monitoring and evaluating the performance of the Manager;
·	reviewing at least annually the continued retention of the Manager;
·	reviewing, at least annually, the terms of appointment of the Manager including, but not limited to, the level and method of remuneration and the notice period of the Manager; and
·	reviewing the performance and remuneration of the other key service providers to the Company.

 

The Committee met once formally in respect of the year ended 30 September 2024 to review the performance and the terms of appointment of the Manager. However, the Management Engagement Committee was heavily involved in supporting the Board undertake due diligence on the acquisition of the Company's Manager by Patria.

 

Following the annual review of the Manager, the Committee recommended to the Board that the continuing appointment of the Manager was in the best interests of the shareholders and the Company as a whole.

 

In reaching this decision, the Committee considered the Company's long-term performance record and concluded that it remained satisfied with the capability of the Manager to deliver satisfactory investment performance, that its processes are thorough and robust, and that it employs a well-resourced team of skilled and experienced fund managers. In addition, the Committee is satisfied that the Manager has the secretarial, administrative and promotional skills required for the effective operation and administration of the Company.

 

Nomination Committee

The Nomination Committee is chaired by Diane Seymour-Williams. The Committee comprises all Non-executive Directors except Alan Devine, who stepped down as a member on 28 May 2023, the ninth anniversary of his appointment as a Board Director.

 

The main responsibilities of the Committee include:

 

·	regularly reviewing the structure, size and composition (including the skills, knowledge, experience, diversity and gender) of the Board;
·	undertaking succession planning, taking into account the challenges and opportunities facing the Company and identifying candidates to fill vacancies;
·	recruiting new Directors, undertaking open advertising or engaging external advisers to facilitate the search, as appropriate, with a view to considering candidates from a wide range of backgrounds, on merit, and with due regard for the benefits of diversity on the Board, taking care to ensure that appointees have enough time available to devote to the position;
·	ensuring that new appointees receive a formal letter of appointment and suitable induction and ongoing training;
·	arranging for the annual Board and Committee performance evaluations and ensuring that Directors are able to commit the time required to properly discharge their duties;
·	making recommendations to the Board as to the position of Chair, SID and Chair of the Nomination, Audit and Management Engagement Committees;
·	assessing, on an annual basis, the independence of each Director; and
·	approving the re-election of any Director, subject to the UK Code, the AIC Code, or the Articles of Association, at the AGM, having due regard to their performance, ability to continue to contribute to the Board in the light of the knowledge, skills and experience required and the need for progressive refreshing of the Board.

          

During the year, the Committee discussed Board succession planning and succession planning for Alan Devine. Conflicted members of the Nomination Committee did not participate in any discussions around Chair succession planning. Alan Devine did not participate in Board Chair succession planning discussions either.

 

The Company appointed Nurole Limited to assist the Committee in Board succession planning during the year. Nurole Limited also assisted the Board with recruitment in 2021 but is independent of the Company and the Board of Directors.

 

In association with Nurole Limited, the Committee drafted a role profile and instigated a search for an additional Non-executive Director. The Committee led the process for the search, interview and appointment of Duncan Budge as an additional Non-executive Director with effect from 1 February 2025. The Committee also considered future Board succession planning requirements over the coming years.

 

Going Concern

The Company's business activities, together with the factors likely to affect its future development, performance and financial position, are set out in the Strategic Report and Investment Manager's Review.

 

The Financial Statements have been prepared on the going concern basis and on the basis that approval as an investment trust company will continue to be met. The Directors have made an assessment of the Company's ability to continue as a going concern and are satisfied that the Company has adequate resources to continue in operational existence for a period of at least 12 months from the date when these Financial Statements were approved.

 

In making the assessment, the Directors of the Company have considered the likely impacts of geopolitical and economic uncertainties on the Company, the investment portfolio and the Company's operations. These include, but are not limited to, the potential further impact of internal conflicts and election cycles, disruptions to global supply chains and increases in the cost of living, persistent inflation, high interest rates and the impact of climate change on PPET's portfolio.

 

At each Board meeting, the Directors review the Company's latest management accounts and other financial information. Following a review of the Company's latest management accounts and other financial information of the Company, the Directors believe that the Company is able to meet the obligations of the Company as they fall due. The Company's commitments to investments are reviewed at each Board meeting, together with its financial resources, including cash held and its borrowing capability. Cash flow scenarios are also presented and discussed at each meeting as well as severe but plausible stress testing and downside liquidity modelling scenarios with varying degrees of decline in investment valuations, decreased investment distributions and increased call rates.

 

In the event of a downside scenario, PPET can take steps to limit or mitigate the impact on the balance sheet by drawing on its revolving credit facility which has been extended from £300.0 million to £400.0 million with effect from 3 February 2025, and pausing on new commitments. It could also look to raise additional credit or capital, sell assets to increase liquidity and reduce its over-commitment ratio.

 

After due consideration of the balance sheet, activities of the Company, its assets, liabilities, commitments and financial resources, the Directors have concluded that the Company has adequate resources to continue in operation for at least 12 months from the approval of the Financial Statements for the year ended 30 September 2025. For this reason, they consider it appropriate to continue to adopt the going concern basis in preparing the Financial Statements.

 

Accountability and Audit

The respective responsibilities of the Directors and the Independent Auditor in connection with the Financial Statements are set out in the Annual Report.

 

The Directors confirm that, so far as they are each aware, there is no relevant audit information of which the Company's Independent Auditor was unaware, and that each Director has taken all the steps that they might reasonably be expected to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Company's Independent Auditor was aware of that information.

 

Independent Auditor

Shareholders approved the reappointment of BDO LLP as the Company's Independent Auditor at the AGM on 27 March 2024 and resolutions to approve its reappointment for the year to 30 September 2025 and to authorise the Directors to determine its remuneration will be proposed at the AGM on 25 March 2025.

 

Additional Information

Where not provided elsewhere in the Directors' Report, the following provides the additional information required to be disclosed by Part 15 of the Companies Act 2006.

 

There are no restrictions on the transfer of Ordinary shares in the Company issued by the Company other than certain restrictions which may from time to time be imposed by law. The Company is not aware of any agreements between shareholders that may result in a transfer of securities and/or voting rights.

 

The rules governing the appointment of Directors are set out in the Directors' Remuneration Report in the Annual Report. The Company's Articles of Association may only be amended by a special resolution passed at a general meeting of shareholders.

 

AGM

The Notice of the AGM, which will be held on 25 March 2025 at 12:30pm at 12 Hay Hill, Mayfair, London W1J 8NR, and the related Notes, may be found in the Annual Report.

 

Shareholders are encouraged to vote on the resolutions proposed in advance of the AGM and submit questions to the Board and to the Manager by emailing [email protected].

 

At the AGM, resolutions including the following business will be proposed:

 

Dividend Policy

As a result of the timing of the payment of the Company's interim dividends, the Company's shareholders are unable to approve a final dividend each year. In line with good corporate governance, the Board therefore proposes to put the Company's dividend policy to shareholders for approval at the AGM and on an annual basis thereafter.

 

The Company's dividend policy is that interim dividends on the Ordinary Shares are payable quarterly. Resolution 3 will seek shareholder approval for the dividend policy.

 

Issue of Ordinary Shares

Resolution 12, which is an ordinary resolution, will, if passed, renew the Directors' authority to allot new Ordinary shares up to an aggregate nominal amount of £30,313, representing 10% of the issued share capital of the Company (excluding treasury shares) as at 27 January 2025. As at 27 January 2025 (being the latest practicable date prior to the publication of this Notice), the Company held 2,180,128 ordinary shares of 0.2p each in treasury, representing 1.44% of the total ordinary shares in issue (excluding treasury shares).

 

Resolution 13, which is a special resolution, will, if passed, renew the Directors' existing authority to allot new Ordinary Shares or sell treasury shares for cash without the new Ordinary Shares first being offered to existing shareholders in proportion to their existing holdings. This will give the Directors authority to allot Ordinary Shares or sell shares from treasury on a non pre-emptive basis for cash up to an aggregate nominal amount of £30,749 (representing 10% of the issued Ordinary Share capital of the Company as at 27 January 2025).

 

New Ordinary Shares, issued under this authority, will only be issued at prices representing a premium to the last published NAV per share.

 

The authorities being sought under resolutions 12 and 13 shall expire at the conclusion of the Company's next AGM in 2026 or, if earlier, on the expiry of 15 months from the date of the passing of the resolutions, unless such authorities are renewed, varied or extended prior to such time. The Directors have no current intention to exercise these authorities and will only do so if they believe it is advantageous and in the best interests of shareholders as a whole.

 

Purchase of the Company's Ordinary Shares

Resolution 14, which is a special resolution, seeks to renew the Board's authority to make market purchases of the Company's Ordinary Shares in accordance with the provisions contained in the Companies Act 2006 and the FCA's Listing Rules. Accordingly, the Company will seek authority to purchase up to a maximum of 14.99% of the issued share capital (excluding treasury shares) at the date of passing of the resolution at a minimum price of 0.2 pence per share (being the nominal value).

 

Under the Listing Rules, the maximum price that may be paid on the exercise of this authority must not exceed the higher of:

 

·	105% of the average of the middle market quotations (as derived from the Daily Official List of the London Stock Exchange) for the shares over the five business days immediately preceding the date of purchase; and
·	the higher of the last independent trade and the highest current independent bid on the trading venue on which the purchase is carried out.

 

The Board only intends to use this authority to purchase the Company's Ordinary Shares, if doing so would result in an increase in the NAV per Ordinary Share and would be in the best interests of shareholders. Any Ordinary Shares purchased shall either be cancelled or held in treasury. The authority being sought shall expire at the conclusion of the AGM in 2026 or, if earlier, on the expiry of 15 months from the date of the passing of the resolution unless such authority is renewed prior to such time.

 

Notice of General Meetings

The Companies Act 2006 provides that the minimum notice period for general meetings of listed companies is 21 days, but with an ability for companies to reduce this period to 14 days (other than for AGMs) provided that two conditions are met. The first condition is that the company offers a facility, accessible to all shareholders, to appoint a proxy by means of a website. The second condition is that there is an annual resolution of shareholders approving the reduction of the minimum notice period from 21 days to 14 days.

 

In line with previous years, the Board is therefore proposing resolution 15 as a special resolution to approve 14 days as the minimum period of notice for all general meetings of the Company other than AGMs, renewing the authority passed at last year's AGM. The approval would be effective until the end of the Company's next AGM, when it is intended that the approval be renewed.

 

The Board would consider on a case-by-case basis whether the use of the flexibility offered by the shorter notice period is merited, taking into account the circumstances, including whether the business of the meeting is time sensitive and it would therefore be to the advantage of the shareholders to call the meeting on shorter notice.

 

Investment Objective & Policy

As noted in the Chair's Statement, the Board has recently undertaken a review of the Company's investment objective and policy. In 2019, shareholders voted to amend the investment objective and policy to allow the Manager to have increased flexibility to make direct investments into private companies alongside private equity managers.

 

As at 30 September 2024, around 26% of the Company's portfolio was invested in direct investments. PPET has benefitted from lower fees and strong performance of its direct investment book and the Manager has identified a number of opportunities to grow this book further. Whilst the majority of the Company's portfolio will continue to comprise fund investments, the Board recommends that the investment policy is amended to provided flexibility to increase the direct investment opportunity through providing in the investment policy that the expected range of direct investments (meaning co-investments and single asset secondaries) is 20-35% of the total value of investments (and, in light of this change, also confirm that the expected portfolio allocation to fund investments is to be around 65-80% of the total value of investments).

 

The Board is also taking the opportunity to propose some simplifications, clarifications and other amendments to PPET's investment objective and policy.

 

These include, but are not limited to: (i) reducing the upper limit on the overcommitment ratio (being the ratio by which the Company can make commitments in excess of its uninvested capital) from 75% to 65% over the long-term (so that the over-commitment ratio should sit within the range of 30%-65% over the long term as opposed to 30% to 75%); (ii) clarify that no single fund investment or direct investment may exceed 15% of the Company's total value of investment at the time of investment and; (iii) make clear that the principal focus of the Company's investment strategy is the European mid-market.

 

The Listing Rules of the FCA (the "UKLRs") require any proposed material changes to the Company's published investment objective and policy to be submitted to the FCA for prior approval. The Company obtained FCA approval on 20 January 2025. The UKLRs also require shareholder approval prior to any material changes being made to the Company's published investment objective and policy.

 

The amendments are therefore subject to the approval of shareholders at the Annual General Meeting. Accordingly, subject to the approval of Resolution 16, which will be proposed as an ordinary resolution, the Company's new investment objective and policy will be as follows and a comparison of the new investment objective policy against the existing objective and policy is shown in the Annual Report.

 

New Investment Objective:

To achieve long-term total returns through investing in and managing a diverse portfolio of private equity investments, principally focused on the European mid-market.

 

New Investment Policy:

The Company seeks to achieve its investment objective by, principally:

 

(i) committing to private equity funds, both on a primary basis (at a fund's inception) and a secondary basis (by acquiring fund positions from other investors during a fund's life); and

(ii) making direct investments (via co-investments and single company secondaries) into private companies alongside mid-market focused private equity firms.

 

The Company expects that the value of fund investments will represent around 65-80% of the total value of investments and that the value of direct investments will represent 20-35% of the total value of investments. No single fund investment or direct investment may exceed 15% of the Company's total value of investments at the time of investment.

 

Investments made by the Company are typically with or alongside private equity firms with whom the Manager has an established relationship and has conducted full due diligence on.

 

Whilst the significant majority of investments will have a European focus, the Company's policy is to maintain a diversified portfolio by country, industry sector, maturity and number of underlying investments.

 

The Company may also hold quoted securities as a result of distributions in specie from its portfolio of fund investments. The Company's policy is normally to dispose of such assets as soon as practicable where they are held on an unrestricted basis.

 

As an investor in private equity funds, the Company follows an over-commitment strategy by making commitments which exceed its uninvested capital. This allows the Company to maximise the proportion of invested assets, allowing efficient use of the Company's resources.

 

In making such commitments, the Manager, together with the Board, will take into account the uninvested capital, the value and timing of expected and projected cash flows to and from the portfolio and, from time to time, may use borrowings to meet drawdowns. The Board has agreed that the over-commitment ratio should sit within the range of 30% to 65% over the long term.

 

The Company's maximum borrowing capacity, defined in its Articles of Association, is an amount equal to the aggregate of the amount paid up on the issued share capital of the Company and the amount standing to the credit of the reserves of the Company. However, it is expected that borrowings would not normally exceed 30% of the Company's net assets at the time of drawdown.

 

The Company's non-sterling currency exposure is principally to the euro and US dollar. The Company does not seek to hedge this exposure into sterling, although any borrowings in euros and other currencies in which the Company is invested would have such a hedging effect.

 

Cash held pending investment may be invested in short-dated government bonds, money-market instruments, bank deposits or other similar investments. Cash held pending investment may also be invested in other listed investment companies or trusts. The Company will not invest more than 15% of its total assets in such listed equities.

 

The investment limits described above are all measured at the time of investment.

 

Recommendation

The Board considers that the resolutions to be proposed at the AGM are in the best interests of the Company and most likely to promote the success of the Company for the benefit of its members as a whole. Accordingly, the Board recommends that shareholders vote in favour of the resolutions as they intend to do in respect of their own beneficial shareholdings, amounting to 71,861 Ordinary Shares, representing 0.05% of the issued share capital.

 

By order of the Board

GPMS Corporate Secretary Limited

Company Secretary

50 Lothian Road, Festival Square

Edinburgh EH3 9WJ

29 January 2025

 

Directors' Responsibility Statement

 

Directors' Responsibilities

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice, the requirements of the Companies Act 2006 and

applicable law and regulations.

 

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law) including FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss for the Company for that period.

 

In preparing these financial statements, the Directors are required to:

 

·	select suitable accounting policies and then apply them consistently;
·	make judgements and accounting estimates that are reasonable and prudent;
·	state whether they have been prepared in accordance with applicable UK Accounting Standards, subject to any material departures disclosed and explained in the financial statements;
·	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business; and
·	prepare a Directors' Report, a Strategic Report and Directors' Remuneration Report which comply with the requirements of the Companies Act 2006.

 

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company'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 comply with the Companies Act 2006.

 

They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors are responsible for ensuring that the Annual Report and accounts, taken as a whole, are fair, balanced, and understandable and provides the information necessary for shareholders to assess the Company's position and performance, business model and strategy.

 

Website Publication

The Directors are responsible for ensuring the Annual Report and the financial statements are made available on a website. Financial statements are published on the Company's website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Company's website is the responsibility of the Directors. The Directors' responsibility also extends to the ongoing integrity of the financial statements contained therein.

 

Directors' Responsibilities Pursuant to DTR4

The Directors confirm to the best of their knowledge:

 

·	the financial statements have been prepared in accordance with applicable accounting standards and give a true and fair view of the assets, liabilities, financial position and profit and loss of the Company; and
·	the Annual Report includes a fair review of the development and performance of the business and the financial position of the Company, together with a description of the principal risks and uncertainties that the Company faces.

 

On behalf of the Board

Alan Devine

Chair

29 January 2025

Financial Statements

 

STATEMENT OF COMPREHENSIVE INCOME

For the year ended 30 September 2024

 

		For the year ended 30 September 2024			For the year ended 30 September 2023
	Notes	Revenue	Revenue	Revenue	Revenue	Capital	Total
		£'000	£'000	£'000	£'000	£'000	£'000
Total capital gains on investments	9	-	38,353	38,353	-	70,562	70,562
Currency gains / (losses)	14	-	4,251	4,251	-	(60)	(60)
Income	2	6,903	-	6,903	9,645	-	9,645
Investment management fee	3	(571)	(10,841)	(11,412)	(561)	(10,652)	(11,213)
Administrative expenses	4	(1,269)	-	(1,269)	(1,234)	-	(1,234)
Profit before finance costs and taxation		5,063	31,763	36,826	7,850	59,850	67,700
Finance costs	5	(482)	(8,481)	(8,963)	(332)	(5,821)	(6,153)
Profit before taxation		4,581	23,282	27,863	7,518	54,029	61,547
Taxation	6	(1,329)	14	(1,315)	(1,462)	878	(584)
Profit after taxation		3,252	23,296	26,548	6,056	54,907	60,963
Earnings per share - basic and diluted	8	2.13p	15.25p	17.38p	3.94p	35,71p	39.65p

The Total columns of this statement represents the profit and loss account of the Company.

 

There are no items of other comprehensive income, therefore this statement is the single statement of comprehensive income of the Company.

 

All revenue and capital items in the above statement are derived from continuing operations.

 

No operations were acquired or discontinued in the year.

 

The total dividend which has been recommended based on this Statement of Comprehensive Income is 16.80p (2023:16.00p) per Ordinary share.

 

The accompanying notes form an integral part of these Financial Statements.

 

 

STATEMENT OF FINANCIAL POSITION

As at 30 September 2024

 

			As at		As at
			30 September 2024		30 September 2023
	Notes	£'000	£'000	£'000	£'000
Non-current assets
Investments	9		1,177,106		1,261,995
Current assets			1,177,106		1,261,995
Receivables	10	130,147		30,117
Cash and cash equivalents		28,358		9,436
Total Current assets		158,505		39,553
Current liabilities
Payables	11	(3,704)		(5,022)
Revolving credit facility	12	(139,803)		(100,883)
Net current assets / (liabilities)			14,998		(66,352)
Total assets less current liabilities			1,192,104		1,195,643
Capital and reserves
Called-up share capital	13		307		307
Share premium account	14		86,485		86,485
Special reserve	14		51,503		51,503
Capital redemption reserve	14		94		94
Capital reserves	14		1,053,715		1,057,254
Revenue reserve	14		-		-
Total shareholders' funds			1,192,104		1,195,643
Net asset value per equity share	15		780.1p		777.7p

The accompanying notes form an integral part of these financial statements.

 

The Financial Statements of Patria Private Equity Trust plc (formerly known as abrdn Private Equity Opportunities Trust plc), registered number SC216638, were approved and authorised for issue by the Board of Directors on 29 January 2025 and were signed on its behalf by Alan Devine, Chair.

 

Alan Devine

Chair

29 January 2025

 

 

STATEMENT OF CHANGES IN EQUITY

 

For the year ended 30 September 2024
	Notes	Called-up Share Capital	Share premium account	Special reserve	Capital redemption reserve	Capital reserves	Revenue reserve	Total
		£'000	£'000	£'000	£'000	£'000	£'000	£'000
Balance at 1 October 2023		307	86,485	51,503	94	1,057,254	-	1,195,643
Profit after taxation		-	-	-	-	23,296	3,252	26,548
Dividends paid	7	-	-	-	-	(21,927)	(3,252)	(25,179)
Repurchase of shares into treasury		-	-	-	-	(4,909)	-	(4,909)
Balance at 30 September 2024	13,14	307	86,485	51,503	94	1,053,715	-	1,192,104
For the year ended 30 September 2023
	Notes	Called-up Share Capital	Share premium account	Special reserve	Capital redemption reserve	Capital reserves	Revenue reserve	Total
		£'000	£'000	£'000	£'000	£'000	£'000	£'000
Balance at 1 October 2022		307	86,485	51,503	94	1,019,663	-	1,158,052
Profit after taxation		-	-	-	-	54,907	6,056	60,963
Dividends paid	7	-	-	-	-	(17,316)	(6,056)	(23,372)
Balance at 30 September 2023	13,14	307	86,485	51,503	94	1,057,254	-	1,195,643
The accompanying notes form an integral part of these Financial Statements.

 

STATEMENT OF CASH FLOWS

 

			For the year ended		For the year ended
			30 September 2024		30 September 2023
	Notes	£'000	£'000	£'000	£'000
Cashflows from operating activities
Profit before taxation			27,863		61,547
Adjusted for:
Finance costs	5		8,963		6,153
Gains on disposal of investments	9		(82,804)		(112,726)
Revaluation of investments	9		44,129		41,864
Currency (gains) / losses	14		(4,251)		60
(Increase)/decrease in non-investment related debtors			(108)		241
(Decrease) / increase in creditors			(1,035)		880
Tax deducted from non-UK income	6		(1,315)		(584)
Net cash outflow from operating activities			(8,558)		(2,565)
Investing activities
Purchase of investments	9	(157,648)		(189,446)
Purchase of secondary investments	9	(6,065)		(3,857)
Distributions of capital proceeds by investments	9	143,595		141,555
Receipt of proceeds from disposal of investments	9	43,725		22,955
Net cash inflow / (outflow) from investing activities			23,607		(28,793)
Financing activities
Revolving credit facility - amounts drawn	12	82,954		60,239
Revolving credit facility - amounts repaid	12	(39,810)		(19,893)
Interest and commitment fees paid		(8,266)		(6,461)
Ordinary dividends paid	7	(25,179)		(23,372)
Repurchase of shares into treasury		(4,909)		-
Net cash inflow from financing activities			4,790		10,513
Net increase / (decrease) in cash and cash equivalents			19,839		(20,845)
Cash and cash equivalents at the beginning of the year			9,436		30,341
Currency losses on cash and cash equivalents			(917)		(60)
Cash and cash equivalents at the end of the year			28,358		9,436
Cash and cash equivalents consist of:
Cash			28,358		9,436
Cash and cash equivalents			28,358		9,436

The accompanying notes form an integral part of these Financial Statements.

 

Included in profit before taxation is dividends received from investments of £4,527,000 (2023: £3,532,000), interest received from investments of £1,791,000 (2023: £5,519,000) and interest received from cash balances of £586,000 (2023: £594,000).

Included in interest and commitment fees paid is interest paid of £6,989,000 (2023: £4,787,000) and commitment fees paid of £1,277,000 (2023; £1,674,000).

NOTES TO THE FINANCIAL STATEMENTS

 

1. Accounting Policies

(a) Basis of Accounting

The Financial Statements have been prepared in accordance with the Companies Act 2006, Financial Reporting Standard 102 and with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts, (the 'SORP'), updated in July 2022. They have also been prepared on the assumption that approval as an investment trust will continue to be granted. The Financial Statements have been prepared on a going concern basis. The Directors believe that this is appropriate for the reasons outlined in the Directors' Report. The principal accounting policies adopted are set out below. These policies have been applied consistently throughout the current and prior year.

 

Rounding is applied to the disclosures in these Financial Statements, where considered relevant.

 

(b) Revenue, Expenses and Finance Costs

Dividends and income from unquoted investments are included when the right to receipt is established, which is the notice value date. Dividends are accounted for as revenue in the Statement of Comprehensive Income. Interest receivable is dealt with on an accruals basis.

 

All expenses are accounted for on an accruals basis. Expenses are charged through the revenue account of the Statement of Comprehensive Income except as follows:

 

·	transaction costs incurred on the purchase and disposal of investments are recognised as a capital item in the Statement of Comprehensive Income; and
·	the Company charges 95% of investment management fees and finance costs to capital, in accordance with the Board's expected long-term split of returns between capital gains and income from the Company's investment portfolio. Bank interest expense has been charged wholly to revenue.

 

(c) Investments

Investments have been designated upon initial recognition as fair value through profit or loss as detailed below. On the date of making a legal commitment to invest in a fund or co-investment, such commitment is recorded and disclosed. When funds are drawn in respect of these commitments, the resulting investment is recognised in the Financial Statements. The investment is removed when it is realised or when the investment is wound up. Gains and losses arising from changes in fair value are included as a capital item in the Statement of Comprehensive Income and are ultimately recognised in the capital reserves.

 

Unquoted investments are stated at the Directors' estimate of fair value and follow the recommendations of the European Private Equity & Venture Capital Association ('EVCA') and the British Private Equity & Venture Capital Association ('BVCA'). The estimate of fair value is normally the latest valuation placed on an investment by its manager as at the Statement of Financial Position date. The valuation policies used by the manager in undertaking that valuation will generally be in line with the joint publication from the EVCA and the BVCA, 'International Private Equity and Venture Capital Valuation guidelines'. Where formal valuations are not completed as at the Statement of Financial Position date, the last available valuation from the Manager is adjusted for any subsequent cash flows occurring between the valuation date and the Statement of Financial Position date. The Company's Manager may further adjust such valuations to reflect any changes in circumstances from the last manager's formal valuation date to arrive at the estimate of fair value.

 

For listed investments, which were actively traded on recognised stock exchanges, fair value is determined by reference to their quoted bid prices on the relevant exchange as at the close of business on the last trading day of the Company's financial year.

 

(d) Dividends payable

Dividends are recognised in the period in which they are paid.

 

(e) Capital and Reserves

Share premium - The share premium account represents the premium above nominal value received by the Company on issuing shares net of issue costs.

 

Special reserve - Court approval was given on 27 September 2001 for 50% of the initial premium arising on the issue of the Ordinary Share capital to be cancelled and transferred to a special reserve. The reserve is a distributable reserve and may be applied in any manner as a distribution, other than by way of a dividend.

 

Capital redemption reserve - This reserve is used to record the amount equivalent to the nominal value of any of the Company's own shares purchased and cancelled in order to maintain the Company's capital.

 

Capital reserve - Gains/(Losses) on disposal - Represents gains or losses on investments realised in the period that have been recognised in the Statement of Comprehensive Income, in addition to the transfer of any previously recognised unrealised gains or losses on investments within 'Capital reserve - revaluation' upon disposal. This reserve also represents other accumulated capital-related expenditure such as management fees and finance costs, as well as other currency gains/losses from non-investment activity. Company shares which are repurchased into treasury are also represented in this reserve.

 

Capital reserve - Revaluation - Represents increases and decreases in the fair value of investments that have been recognised in the Statement of Comprehensive Income during the period.

 

Revenue Reserve - The revenue reserve represents accumulated revenue profits retained by the Company that have not currently been distributed to shareholders as a dividend.

 

The revenue and capital reserves - Gains/(losses) on disposal represent the amount of the Company's reserves distributable by way of dividend.

 

(f) Taxation

i) Current taxation - Provision for corporation tax is made at the current rate on the excess of taxable income net of any allowable deductions. In line with the recommendations of the SORP, the allocation method used to calculate tax relief on expenses presented against capital 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 column of the Statement of Comprehensive Income, then no tax relief is transferred to the capital column. Withholding tax suffered on income from overseas investments is taken to the revenue column of the Statement of Comprehensive Income.

 

ii) Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the Statement of Financial Position date, where transactions or events that result in an obligation to pay more or a right to pay less tax in future have occurred at the Statement of Financial Position date, measured on an undiscounted basis and based on enacted tax rates. This is subject to deferred tax assets only being recognised if it is considered more likely than not that there will be suitable profits from which the future reversal of the underlying timing differences can be deducted. Timing differences are differences arising between the Company's taxable profits and its results as stated in the Financial Statements which are capable of reversal in one or more subsequent periods.

 

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

 

(g) Foreign Currency Translation, Functional and Presentation Currency

Foreign currency translation - Transactions in foreign currencies are converted to Sterling at the exchange rate ruling at the date of the transaction. Overseas assets and liabilities are translated at the exchange rate prevailing at the Company's Statement of Financial Position date. Gains or losses on translation of investments held at the year-end are accounted for in the Statement of Comprehensive Income through inclusion in total capital gains/losses on investments and is transferred to capital reserves. Gains or losses on the translation of overseas currency balances held at the year-end are also accounted for through the Statement of Comprehensive Income and are transferred to capital reserves.

 

Functional and presentation currency - For the purposes of the Financial Statements, the results and financial position of the Company is expressed in Sterling, which is the functional currency and the presentation currency of the Company.

 

Rates of exchange to sterling at 30 September were:

 

	2024	2023
Euro	1.2019	1.1528
US Dollar	1.3414	1.2206
Canadian Dollar	1.8121	1.6502

Transactions in overseas currency are translated at the exchange rate prevailing on the date of transaction.

The Company's investments are made in a number of currencies. However, the Board considers the Company's functional currency to be Sterling. In arriving at this conclusion, the Board considers that the shares of the Company are listed on the London Stock Exchange. The Company is regulated in the United Kingdom, principally having its shareholder base in the United Kingdom, pays dividends as well as expenses in Sterling.

(h) Cash and Cash Equivalents

Cash comprises bank balances and cash held by the Company. Cash equivalents comprise money-market funds, which are used by the Company to provide additional short-term liquidity. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(i) Debtors

Debtors are recognised initially at fair value. They are subsequently measured at amortised cost using the effective interest method, less the appropriate allowances for estimated irrecoverable amounts.

(j) Creditors

Creditors are recognised initially at fair value. They are subsequently stated at amortised cost using the effective interest method.

(k) Revolving Credit Facility

Revolving credit facility drawdowns are recognised initially at cost, being the fair value of the consideration received. They are subsequently stated at amortised cost using the effective interest method.

(l) Segmental Reporting

The Directors are of the opinion that the Company is engaged in a single segment of business activity, being investment business. Consequently, no business segmental analysis is provided.

(m) Judgements and Key Sources of Estimation Uncertainty

The preparation of Financial Statements requires the Company to make estimates and assumptions and exercise judgements in applying the accounting policies that affect the reported amounts of assets and liabilities at the date of the Financial Statements and the reported amounts of revenues and expenses arising during the year. Estimates and judgements are continually evaluated and based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The area where estimates and assumptions have the most significant effect on the amounts recognised in the Financial Statements is the determination of fair value of unquoted investments, as disclosed in Note 1(c).

 

2. Income

 

		Year to	Year to
		30 September 2024	30 September 2023
		£'000	£'000
	Dividends from investments	4,526	5,519
	Interest from investments	1,791	3,532
	Interest from cash balances	586	594
	Total income	6,903	9,645

 

3. Investment Management Fees

 

		Year to 30 September 2024			Year to 30 September 2023
		Revenue	Capital	Total	Revenue	Capital	Total
		£'000	£'000	£'000	£'000	£'000	£'000
	Investment management fee	571	10,841	11,412	561	10,652	11,213

 

The Manager of the Company is Patria Capital Partners LLP (formerly abrdn Capital Partners LLP). In order to comply with the Alternative Investment Fund Managers Directive, the Company appointed Patria Capital Partners LLP as its Alternative Investment Fund Manager from1 July 2014.

 

The investment management fee payable to the Manager is 0.95% per annum of the NAV of the Company. The investment management fee is allocated 95% to the realised capital reserve - gains/(losses) on disposal and 5% to the revenue account. The management agreement between the Company and the Manager is terminable by either party on 12 months' written notice.

 

Investment management fees due to the Manager as at 30 September 2024 amounted to £2,627,000 (30 September 2023: £3,943,000).

 

4. Administrative Expenses

 

		Year to	Year to
		30 September 2024	30 September 2023
		£'000	£'000
	Directors' fees	285	269
	Employers' national insurance	33	31
	Secretarial and administration fees	281	266
	Marketing fees	255	323
	Fees and subscriptions	116	99
	Auditor's remuneration	93	84
	Depositary fees	66	62
	Professional and consultancy fees	34	55
	Legal fees	6	7
	Other expenses	100	38
	Total	1,269	1,234

 

No non-audit services were provided by the Company auditor, BDO LLP, during the year to 30 September 2024. The Auditor's remuneration is reported net of VAT.

 

Irrecoverable VAT has been included under the relevant expense line.

 

The administration fee payable to IQ EQ Administration Services (UK) Ltd is adjusted annually in line with the retail price index. The administration agreement is terminable by the Company on three months' notice.

 

As of 29 April 2024, the secretarial fee is payable to GPMS. The secretarial fee payable to GPMS Corporate Secretary Limited is adjusted annually in line with the retail price index. Prior to this date, the secretarial fee was payable to abrdn Holdings Limited. The secretarial agreement is terminable by the Company on six months' notice.

 

The emoluments paid to the Directors during the year can be found in the Directors' Remuneration Report in the Annual Report.

 

5. Finance Costs

 

		Year to 30 September 2024			Year to 30 September 2023
		Revenue	Capital	Total	Revenue	Capital	Total
		£'000	£'000	£'000	£'000	£'000	£'000
	Revolving credit facility interest expense	385	6,640	7,025	215	3,604	3,819
	Revolving credit facility commitment fee	64	1,213	1,277	84	1,590	1,674
	Revolving credit facility arrangement fee	33	628	661	33	627	660
	Total	332	5,821	8,963	332	5,821	6,153

 

6. Taxation

 

						Year to	Year to
						30 September 2024	30 September 2023
						£'000	£'000
	Overseas withholding tax					1,315	584

 

(a) Analysis of the tax charge throughout the year

 

		Year to 30 September 2024			Year to 30 September 2023
		Revenue	Capital	Total	Revenue	Capital	Total
		£'000	£'000	£'000	£'000	£'000	£'000
	Profit before taxation	4,581	23,282	27,863	7,518	54,029	61,547

(b) Factors affecting the total tax charge for the year

The tax assessed for the year is different from the standard rate of corporation tax in the UK. The differences are explained below.

 

		Year to 30 September 2024			Year to 30 September 2023
		Revenue	Capital	Total	Revenue	Capital	Total
		£'000	£'000	£'000	£'000	£'000	£'000
	Profit multiplied by the effective rate of corporation tax in the UK - 25.0% (2023: 22.0%)	1,145	5,821	6,966	1,655	11,887	13,542
	Non-taxable capital gains on investments 1	-	(9,588)	(9,588)	-	(15,524)	(15,524)
	Non-taxable currency (gains)/losses	-	(1,063)	(1,063)	-	13	13
	Non-taxable income	(1,131)	-	(1,131)	(777)	-	(777)
	Overseas withholding tax	1,315	-	1,315	584	-	584
	Surplus management expenses and loan relationship deficits not relieved	-	4,816	4,816	-	2,746	2,746
	Total tax charge/(credit) for the year	1,329	(14)	1,315	1,462	(878)	584
	1 The Company carries on business as an investment trust company with respect to sections 1158-1159 of the Corporation Tax Act 2010. As such any capital gains are exempt from UK taxation.

 

(c) Factors that may affect future tax charges

At the year-end, there is a potential deferred tax asset of £16,052,787 (2023: £11,202,939) in relation to excess management expenses carried forward. The deferred tax asset is unrecognised at the year-end in line with the Company's stated accounting policy.

 

The Corporation Tax main rate for the years 1 April 2023 and 2024 was 25%. A revision to Corporation Tax was introduced in the Finance Bill 2021, which retained the main rate at 19% from 1 April 2022, followed by an increase to 25% from 1 April 2023. Deferred taxes at the Statement of Financial Position date have been measured at these enacted rates and reflected in these Financial Statements.

 

7. Dividend on Ordinary Shares

 

		Year to	Year to
		30 September 2024	30 September 2023
		£'000	£'000
	Amount recognised as a distribution to equity holders in the year:
	2023 third quarterly dividend of 4.00p (2022: 3.60p) per Ordinary Share paid on 27 October 2023 (2022: paid on 28 October 2022)	6,150	5,536
	2023 fourth quarterly dividend of 4.00p per Ordinary Share (2022: 3.60p) paid on 26 January 2024 (2022: paid on 27 January 2023)	6,150	5,536
	2024 first quarterly dividend of 4.20p (2023: 4.00p) per Ordinary Share paid on 26 April 2024 (2023: paid on 21 April 2023)	6,441	6,150
	2024 second quarterly dividend of 4.20p (2023: 4.00p) per Ordinary Share paid on 26 July 2024 (2023: paid on 28 July 2023)	6,438	6,150
	Total	25,179	23,372
Set out below are the total dividends paid and proposed in respect of the financial year, which is the basis on which the requirements of sections 1158-1159 of the Corporation Tax Act 2010 are considered. Of the total profit after taxation for the year of £26,548,000 (2023: £60,963,000), the total revenue and capital profits which are available for distribution by way of a dividend for the year is £65,791,000 (2023: £102,208,000).
		Year to	Year to
		30 September 2024	30 September 2023
		£'000	£'000
	2024 first quarterly dividend of 4.20p (2023: 4.00p) per Ordinary Share paid on 26 April 2024 (2023: paid on 21 April 2023)	6,441	6,150
	2024 second quarterly dividend of 4.20p (2023: 4.00p) per Ordinary Share paid on 26 July 2024 (2023: paid on 28 July 2023)	6,438	6,150
	2024 third quarterly dividend of 4.20p (2023: 4.00p) per Ordinary Share paid on 25 October 2024 (2023: paid on 27 October 2023)	6,421	6,150
	2024 fourth quarterly dividend of 4.20p per Ordinary Share (2023: 4.00p) paid on 24 January 2025 (2023: paid on 26 January 2024)	6,381	6,150
	Total	25,681	24,600

 

8. Earnings Per Share - Basic and Diluted

		Year to		Year to
		30 September 2024		30 September 2023
		p	£'000	p	£'000
	The net return per Ordinary Share is based on the following figures:
	Revenue net return	2.13	3,252	3.94	6,056
	Capital net return	15.25	23,296	35.71	54,907
	Total net return	17.38	26,548	39.65	60,963
	Weighted average number of Ordinary Share in issue excluding those held in treasury:		152,806,166		153,746,294

 

There are no diluting elements to the earnings per share calculation in 2024 (2023: none).

 

9. Investments

		Year to 30 September 2024	Year to 30 September 2023
		Total	Total
		£'000	£'000
	Fair value through profit or loss:
	Opening market value	1,261,995	1,192,380
	Opening investment holding gains	(304,198)	(346,062)
	Opening book cost	957,797	846,318
	Movements in the year:
	Additions at cost	157,648	189,446
	Secondary purchases	6,065	3,857
	Distribution of capital proceeds	(143,595)	(141,555)
	Secondary sales	(143,682)	(52,995)
		834,233	845,071
	Gains on disposal of underlying investments	82,804	112,726
	Closing book cost	917,037	957,797
	Closing investment holding gains	260,069	304,198
	Closing market value	1,177,106	1,261,995

 

		Year to 30 September 2024	Year to 30 September 2023
		Total £'000	Total £'000
	Gains on investments held at fair value through profit or loss based on historical costs.	82,804	112,726
	Gains recognised as unrealised in previous years in respect of distributed capital proceeds or disposal of investments.	(64,168)	(46,367)
	Gains on distribution of capital proceeds or disposal of investments based on the carrying value at the previous year end date	18,636	66,359
	Net movement in unrealised investment gains	20,390	4,503
	Total capital gains on investments held at fair value through profit or loss	38,675	70,862

 

Transaction costs

During the year, expenses were incurred in acquiring or disposing of investments. These have been expensed through capital and are included within capital gains on investments of £38,353,000 (2023: £70,562,000) in the Statement of Comprehensive Income. The total costs were as follows:

 

	Year to 30 September 2024	Year to 30 September 2023
	£'000	£'000
Transaction costs	322	300

 

10. Receivables

 

		30 September 2024	30 September 2023
		£'000	£'000
	Amounts falling due within one year:
	Investments receivable	129,996	30,040
	Prepayments	104	39
	Interest receivable	47	38
	Total	130,147	30,117

 

Investments receivable as at 30 September 2024 relate to sales proceeds due to the Company, receivable in three contractual payments with the first payment received in December 2024, the second in January 2025 and the final payment due in September 2025.

 

11. Payables

 

		30 September 2024	30 September 2023
		£'000	£'000
	Amounts falling due within one year:
	Management fee	2,627	3,943
	Accruals	998	888
	Secretarial and administration fee	79	191
	Total	3,704	5,022

 

12. Revolving Credit Facility

 

		30 September 2024	30 September 2023
		£'000	£'000
	Revolving credit facility	139,803	100,883

 

At 30 September 2024, the Company had a £300.0 million (30 September 2023: £300.0 million) committed, multicurrency syndicated revolving credit facility, of which £140.6 million (30 September 2023: £102.4 million) had been drawn down. The facility is provided by The Royal Bank of Scotland International Limited, Société Générale and State Street Bank International GmbH. The facility expires in December 2025.

 

The interest rate on the facility is calculated as the defined reference rate of the currency drawn plus 1.625% rising to 2.0% depending on the level of utilisation, whilst the commitment fee rate payable on non-utilisation is between 0.7% and 0.8% per annum based on the level of facility utilisation.

 

Inclusive of the revolving credit facility balance is £813,000 of unamortised revolving credit facility fees, which partially offsets the total amount of the facility balance drawn as at 30 September 2024 (2023: £1,475,000).

 

On 24 January 2025, the Company announced an expansion of the credit facility which increased from £300.0 million to £400.0 million with Banco Santander, S.A. and State Street Bank & Trust Company joining the syndicate of banks as new lenders alongside current providers The Royal Bank of Scotland International Limited (London Branch), Société Générale, London Branch and State Street Bank International GMBH.  NatWest Markets plc continues to act as facility agent and will now also act as security agent to the syndicate of banks.

 

The credit facility now matures on 3 February 2028 with options to extend for up to a further two years.

 

The margin on the Loan Facility is 2.6%, and the commitment fee payable on non-utilisation is between 0.8% and 0.9% per annum, depending on the level of utilisation. An annual fee of 0.35% is also payable.

 

Analysis of changes in net debt

	As at 30 September 2023 £'000	Cashflows £'000	Operational non-cash charges1	As at 30 September 2024 £'000
Cash and cash equivalents	9,436	19,839	(917)	28,358
Revolving credit facility	(100,883)	(43,142)	(4,221)	139,803
Net debt	(91,447)	(23,303)	(5,138)	168,161

¹ Other non-cash charges relate to foreign currency movements as well as the amortisation of capitalised arrangement fees which are included against the revolving credit facility balance.

 

13. Called-up Share Capital

 

		30 September 2024	30 September 2023
		£'000	£'000
	Issued and fully paid:
	Ordinary shares of 0.2p
	Opening balance of 153,746,294 (2023: 153,746,294) Ordinary Shares	307	307
	Closing balance of 152,806,166 (2023: 153,746,294) Ordinary Shares	307	307

The Company may buy back its own shares where it is judged to be beneficial to shareholders, taking into account the discount between the Company's net assets and the share price, and the supply and demand for the Company's shares in the open market.

 

The Company repurchased 940,128 (2023: none) of its own Ordinary Shares during the year ended 30 September 2024, which are held in treasury. Including shares held in treasury, the Company has a total number of 153,746,294 shares in issue.

 

14. Reserves

 

					Capital reserves
		Share	Special	Capital	Gains/	Revaluation	Revenue
		premium	reserve	redemption	(losses) on		reserve
		account		reserve	disposal
		£'000	£'000	£'000	£'000	£'000	£'000
	Opening balances at 1 October 2023	86,485	51,503	94	753,009	304,245	-
	Gains on disposal of investments	-	-	-	82,804	-	-
	Management fee charged to capital	-	-	-	(10,841)	-	-
	Finance costs charged to capital	-	-	-	(8,481)	-	-
	Transaction costs	-	-	-	(322)	-	-
	Tax relief on management fee and finance costs above	-	-	-	14	-	-
	Currency (losses) / gains	-	-	-	(635)	619	-
	Revaluation of investments	-	-	-	-	(41,864)	-
	Repurchase of shares into treasury				(4,909)
	Return after taxation	-	-	-	-	-	3,252
	Dividends during the year	-	-	-	(21,927)	-	(3,252)
	Closing balances at 30 September 2024	86,485	51,503	94	788,712	265,003	-

 

The revenue and capital reserve - gains/(losses) on disposal represent the amounts of the Company's reserve distributable by way of dividend.

 

15. Net Assets Per Equity Share

 

		As at 30 September 2024	As at 30 September 2023
	Basic and diluted:
	Ordinary shareholders' funds	£1,192,104,190	£1,195,643,000
	Number of Ordinary Shares in issue	153,746,294	153,746,294
	Number of Ordinary Shares in issue excluding those held in treasury	152,806,166	153,746,294
	Net asset value per ordinary share	780.1p	777.7p

 

The net assets per Ordinary Share and the ordinary shareholders' funds are calculated in accordance with the Company's Articles of Association.

 

There are no diluting elements to the net assets per equity share calculation in 2024 (2023: none).

 

16. Commitments and Contingent Liabilities

 

		30 September 2024	30 September 2023
		£'000	£'000
	Outstanding calls on investments	652,709	651,991

 

This represents commitments made to fund and direct investments interests remaining undrawn. The undrawn commitments will typically be paid by the Company to the various interests upon request of its general partner under the terms of the respective underlying agreement each investment.

 

17. Parent Undertaking, Related Party Transactions and Transactions with the Manager

The ultimate parent undertaking of the Company is Phoenix Group Holdings. The results for the year to 30 September 2024 are incorporated into the group Financial Statements of Phoenix Group Holdings, which will be available to download from the website: thephoenixgroup.com.

 

Phoenix Life Limited ('PLL'), which is 100% owned by Phoenix Group Holdings) and the Company have entered into a relationship agreement which provides that, for so long as PLL and its Associates exercise, or control the exercise, of 30% or more of the voting rights of the Company, PLL and its Associates will not seek to enter into any transaction or arrangement with the Company which is not conducted at arm's length and on normal commercial terms, take any action that would have the effect of preventing the Company from carrying on an independent business as its main activity or from complying with its obligations under the Listing Rules or propose or procure the proposal of any shareholder resolution which is intended or appears to be intended to circumvent the proper application of the Listing Rules. During the year ended 30 September 2024, PLL received dividends from the Company totalling £13,509,000 (2023: £12,521,000).

 

During the period ended 30 September 2024, the Manager charged management fees totalling £11,411,000 (2023: £11,213,000) to the Company in the normal course of business. The balance of management fees outstanding at 30 September 2024 was £2,627,000 (2023: £3,943,000).

 

abrdn Investment Management Limited, which shared had the same ultimate parent as the Manager during the period ended 30 September 2024, received fees for the provision of promotional activities of £34,000 (30 September 2023: £108,000) during the period. The balance of promotional activities outstanding at 30 September 2024 was £nil (2023: £89,000).

 

abrdn Holdings Limited, which had shared the same ultimate parent as the Manager during the period ended 30 September 2024, received fees for the provision of Company Secretarial services of £42,000 (30 September 2023: £81,000) during the period. The balance of secretarial fees outstanding at 30 September 2024 was £21,000 (2023: £154,000).

 

Further to the public announcement on 23 October 2023, abrdn plc as the former ultimate beneficial owner of the Manager completed the sale of its European Private Equity business to Nasdaq-listed Patria Investments on 29 April 2024. The announcement of and subsequent sale of the Manager of the Company has no impact on the Financial Statements.

 

Following the sale transaction, abrdn Holdings Limited no longer provides Company Secretarial services to the Company. These services, with effect from 29 April 2024, are provided by GPMS Corporate Secretary Limited, which shares the same ultimate parent as the Manager. GPMS Corporate Secretary Limited received fees for the provision of Company Secretarial services of £42,000 (2023: nil). The balance of secretarial fees outstanding at 30 September 2024 was £42,000 (2023: nil).

 

No other related party transactions were undertaken during the year ended 30 September 2024.

 

18. Risk Management, Financial Assets and Liabilities

 

Financial Assets and Liabilities

The Company's financial instruments comprise fund and other investments, money-market funds, cash balances, debtors and creditors that arise from its operations. The assets and liabilities are managed with the overall objective of achieving long-term total returns for shareholders.

 

Summary of Financial Assets and Financial Liabilities by Category

The carrying amounts of the Company's financial assets and financial liabilities, as recognised at the Statement of Financial Position date of the reporting periods under review, are categorised as follows:

 

 

		30 September 2024	30 September 2023
		£'000	£'000
	Financial assets
	Financial assets measured at fair value through profit or loss:
	Fixed asset investments - designated as such on initial recognition	1,177,106	1,261,995
	Financial assets measured at amortised cost:
	Investments receivable	129,996	30,040
	Money-market funds, cash and short-term deposits	28,358	9,436
		1,335,460	1,301,471
	Non-financial assets
	Other receivables	151	77
		151	77
	Financial Liabilities
	Measured at amortised cost:
	Current liabilities:
	Payables	3,704	5,022
	Revolving credit facility	139,803	100,883
		143,507	105,905

 

Assets/Liabilities Measured at Amortised Cost

The carrying value of the current assets and liabilities is deemed to be fair value due to the short-term nature of the instruments and/or the instruments bearing interest at the market rates.

 

Risk Management

The Directors manage investment risk principally through setting an investment policy and by contracting management of the Company's investments to an investment manager under terms which incorporate appropriate duties and restrictions, and by monitoring performance in relation to these. The Company's investments are in private equity funds, typically unquoted limited partnerships and co-investments. These are valued by their managers generally in line with the EVCA and the BVCA guidelines, which provide for a fair value basis of valuation. The funds may hold investments that have become quoted or the co-investment may become quoted and these will be valued at the appropriate listed price, subject to any discount for marketability restrictions.

 

As explained in the Company's investment policy, risk is spread by investing across a range of countries and industrial sectors, thereby reducing excessive exposure to particular areas. The Manager's investment review and monitoring process is used to identify and, where possible, reduce risk of loss of value in the Company's investments.

 

The Company's investing activities expose it to various types of risk that are associated with the financial instruments and markets in which it invests. The most important types of financial risk to which the Company is exposed are market risk, over-commitment risk, liquidity risk, credit risk and interest rate risk.

 

The nature and extent of the financial instruments outstanding at the Statement of Financial Position date and the risk management policies employed by the Company are discussed below.

 

Market Risk

a) Price Risk

The Company is at risk of the economic cycle impacting the listed financial markets and hence potentially affecting the pricing of new underlying investments, the valuation of existing underlying investments and the price and timing of exits. By having a diversified and rolling portfolio of investments the Company is well-placed to take advantage of economic cycles.

 

100% of the Company's investments are held at fair value. The valuation methodology employed by the managers of the unquoted investments may include the application of EBITDA ratios derived from listed companies with similar characteristics. Therefore, the value of the Company's portfolio is indirectly affected by price movements on listed financial exchanges. A 10% increase in the valuation of investments at 30 September 2024 would have increased the net assets attributable to the Company's shareholders and the total return for the year by £117,711,000 (2023: £126,995,000); a 10% change in the opposite direction would have decreased the net assets attributable to the Company's shareholders and the total return for the year by an equivalent amount. Due to the private nature of the underlying companies in which the Company's investments are invested, it is not possible for the Company to pinpoint the effect to the Company's net assets of changes to the EBITDA ratios of listed markets any more accurately.

 

b) Currency Risk

The Company makes fund and co-investment commitments in currencies other than Sterling and, accordingly, a significant proportion of its investments and cash balances are in currencies other than Sterling. In addition, the Company's syndicated revolving credit facility is a multicurrency facility. Therefore, the Company's NAV is sensitive to movements in foreign exchange rates.

 

The Manager monitors the Company's exposure to foreign currencies and reports to the Board on a regular basis. It is not the Company's policy to hedge foreign currency risk. It is expected that the majority of the Company's commitments and investments will be denominated in Euros. Accordingly, the majority of the Company's indebtedness will usually be held in that currency. No currency swaps or forwards were used during the year.

 

The table below sets out the Company's currency exposure.

 

		30 September 2024		30 September 2023
		Local	Sterling	Local	Sterling
		Currency	Equivalent	Currency	Equivalent
		'000	£'000	'000	£'000
	Fixed asset investments:
	Euro	1,033,478	859,906	1,105,059	958,569
	Sterling	65,406	65,406	67,425	67,425
	US Dollar	337,745	251,795	288,052	236,002
	Cash and cash equivalents:
	Euro	25,491	21,210	9,056	7,856
	Sterling	1,915	1,915	569	569
	US Dollar	7,018	5,232	1,232	1,009
	Canadian Dollar	3	1	3	2
	Investment receivable
	Euro	156,236	129,996	34,631	30,040
	Other receivables:
	Euro	34	28	26	23
	Sterling	105	105	42	42
	US Dollar	23	17	16	13
	Revolving credit facility:
	Euro	(168,022)	(139,803)	(116,300)	(100,883)
	Other creditors:
	Euro	(807)	(672)	(650)	(565)
	Sterling	(2,993)	(2,993)	(4,423)	(4,423)
	US Dollar	(53)	(39)	(43)	(35)
	Total		1,192,104		1,195,643
	Outstanding commitments:
	Euro	562,123	467,715	563,736	489,006
	Sterling	33,830	33,830	10,084	10,084
	US Dollar	202,764	151,164	186,623	152,901
	Total		652,709		651,991

 

c) Currency Sensitivity

During the year ended 30 September 2024, Sterling appreciated by 4.3% relative to the Euro (2023: appreciated 1.2%) and appreciated by 9.9% relative to the US Dollar (2023: appreciated 9.3%).

 

To highlight the sensitivity to currency movements, if the value of Sterling had weakened against both of the above currencies by 10% compared to the exchange rates at 30 September 2023, the capital gain for the year would have increased by £125,221,000 (2023: £125,617,000); a 10% change in the opposite direction would have decreased the capital gain for the year by £102,454,000 (2023: £102,777,000).

 

The calculations above are based on the portfolio valuation and cash and revolving credit facility balances as at the respective Statement of Financial Position dates and are not necessarily representative of the year as a whole.

 

Based on similar assumptions, the amount of outstanding commitments would have increased by £56,309,000 at the year-end (2023: £71,323,000) a 10% change in the opposite direction would have decreased the amount of outstanding commitments by £68,822,000 (2023: £58,355,000).

 

Liquidity Risk

The Company has significant investments in unquoted investments which are relatively illiquid. As a result, the Company may not be able to liquidate its investments quickly at an amount close to their fair value in order to meet its liquidity requirements, including the need to meet outstanding undrawn commitments. The Company manages its liquid investments to ensure sufficient cash is available to meet contractual commitments and also seeks to have cash available to meet other short-term financial needs. Short-term flexibility is achieved, where necessary, through the use of the syndicated revolving credit facility. Liquidity risk is monitored by the Manager on an ongoing basis and by the Board on a regular basis. Payables, as disclosed in Note 11, all fall due within one year and the revolving credit facility, as described in Note 12, has drawn £140,616,000 as at 30 September 2024 (2023: £102,358,000), with an amount of £159,384,000 (2023: £197,642,000) still available to be drawn.

 

Credit Risk

Credit risk is the exposure to loss from failure of a counterparty to deliver securities or cash for acquisitions or disposals of investments or to repay deposits. The Company places funds with authorised deposit takers from time to time and, therefore, is potentially at risk from the failure of any such institution. At the year-end, the Company's financial assets exposed to credit risk amounted to the following:

 

		30 September 2024	30 September 2023
		£'000	£'000
	Cash and cash equivalents	28,358	9,436
	Investment receivable	129,996	30,040
		158,354	39,476

 

The Company's cash is held by BNP Paribas Securities Services SA, which is rated A+ by Standard and Poor's. Should the credit quality or the financial position of the bank deteriorate significantly, the Manager would move the cash balances to another institution.

 

As at 30 September 2024, £129,996,000 of the investment receivable per Note 10 relate to future proceeds, which are due from the secondary sale of fund investments during the period. Under the terms of the transaction, the proceeds of sale are to be received in three contractual payments, the first two of which were received in December 2024 and January 2025 respectively, with the final payment due in September 2025. The Manager considers the credit risk associated with this balance to be in line with those arising from the normal course of business. To date, the buyer has met the payment profile outlined and agreed in the contractually binding sales and purchase agreement. The Manager continues to monitor market developments, which may affect this assessment.

 

Interest Rate Risk

The Company will be affected by interest rate changes as it holds some interest-bearing financial assets and liabilities, which are shown in the table below; however, the majority of its financial assets are investments in private equity investments, which are non-interest bearing. Interest rate movements may affect the level of income receivable on money-market funds and cash deposits and interest payable on the Company's variable rate borrowings. The possible effects on the cash flows that could arise as a result of changes in interest rates are taken into account when making investment and borrowing decisions. Derivative contracts are not used to hedge against any exposure to interest rate risk.

 

Interest Risk Profile

The interest rate risk profile of the portfolio of financial assets and liabilities at the Statement of Financial Position date was as follows:

 

		30 September 2024		30 September 2023
		Weighted average		Weighted average
		interest rate		interest rate
		%	£'000	%	£'000
	Floating rate
	Financial assets: cash and cash equivalents	3.05	28,358	2.72	9,436
	Financial liabilities: Revolving credit facility	5.58	139,803	4.49	100,883

 

The weighted average interest rate on the bank balances is based on the interest rate payable, weighted by the total value of the balances. The weighted average period for which interest rates are fixed on the bank balances is 31 days (2023: 31 days).

 

The weighted average interest rate on the revolving credit facility is based on the interest rate paid on the individual loan balances, weighted by the duration and value of each individual loan balance outstanding during the financial year.

 

Interest Rate Sensitivity

An increase of 1% in interest rates would have decreased the net assets attributable to the Company's shareholders by £1,258,000 (2023: £853,000). A decrease of 1% would have increased the net assets attributable to the Company's shareholders by £1,258,000 (2023: £853,000). The impact of interest rates on revenue is not material. The calculations are based on the interest paid and received during the year.

 

Capital Management Policies and Procedures

The Company's capital management objectives are:

 

·	to ensure that the Company will be able to continue as a going concern; and
·	to maximise the return to its equity shareholders through an appropriate balance of equity capital and debt.

 

As at the year-end, the Company had net debt of £112.3 million (2023: £92.8 million). The Company's maximum borrowing capacity, defined in its Articles of Association, is an amount equal to the aggregate of the amount paid up on the issued share capital of the Company and the amount standing to the credit of the reserves of the Company. However, it is expected that borrowings would not normally exceed 30% of the Company's net assets at the time of drawdown.

 

The Board monitors and reviews the broad structure of the Company's capital on an ongoing basis. This review includes the nature and planned level of gearing, which takes account of the Manager's views on the market 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 period. Any year-end positions are presented in the Statement of Financial Position.

 

The Company is subject to externally imposed capital requirements with respect to the obligation and ability to pay dividends by section 1159 of the Corporation Tax Act 2010 and by the Companies Act 2006, respectively.

 

19. Fair Value Hierarchy

 

FRS 102 requires an entity to classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following classifications:

 

·	Level 1: The unadjusted quoted price in an active market for identical assets or liabilities that the entity can access at the measurement date
·	Level 2: Inputs other than quoted prices included within Level 1 that are observable (i.e., developed using market data) for the asset or liability, either directly or indirectly.
·	Level 3: Inputs are unobservable (i.e., for which market data is unavailable) for the asset or liability.

 

 

The Company's financial assets and liabilities, measured at fair value in the Statement of Financial Position, are grouped into the following fair value hierarchy at 30 September 2024:

 

		Level 1	Level 2	Level 3	Total
	Financial assets at fair value through profit or loss	£'000	£'000	£'000	£'000
	Unquoted investments	-	-	1,177,106	1,177,106
	Net fair value	-	-	1,177,106	1,177,106
	As at 30 September 2023
		Level 1	Level 2	Level 3	Total
	Financial assets at fair value through profit or loss	£'000	£'000	£'000	£'000
	Unquoted investments	-	-	1,261,995	1,261,995
	Net fair value	-	-	1,261,995	1,261,995

 

Unquoted Investments

Unquoted investments are stated at the Directors' estimate of fair value and follow the recommendations of the EVCA and the BVCA. The estimate of fair value is normally the latest valuation placed on an investment by its manager as at the Statement of Financial Position date. The valuation policies used by the manager in undertaking that valuation will generally be in line with the joint publication from the EVCA and the BVCA, 'International Private Equity and Venture Capital Valuation guidelines'. Fair value can be calculated by the manager of the investment in a number of ways. In general, the managers with whom the Company invests adopt a valuation approach, which applies an appropriate comparable listed company multiple to a private company's earnings adjusted for marketability discounts where appropriate, or by reference to recent transactions. Where formal valuations are not completed as at the Statement of Financial Position date, the last available valuation from the manager is adjusted for any subsequent cash flows occurring between the valuation date and the Statement of Financial Position date. The Company's Manager may further adjust such valuations to reflect any changes in circumstances from the last manager's formal valuation date to arrive at the estimate of fair value.

 

ALTERNATIVE PERFORMANCE MEASURES

APMs are numerical measures of the Company's current, historical or future performance, financial position or cash flows, other than financial measures defined or specified in the applicable financial framework. The Company's applicable financial framework includes FRS 102 and the Association of Investment Companies ('AIC') SORP.

 

The APMs are considered by the Board and the Manager to be the most relevant basis for shareholders in assessing the overall performance of the Company and for comparing the performance of the Company to its peers, taking into account industry practice. Definitions and reconciliations to IFRS measures are provided in the main body of the report or in this Glossary of the Annual Report, where appropriate.

 

In selecting these APMs, the Directors considered the key objectives and expectations of typical investors in an investment trust such as PPET.

 

Annualised NAV Total Return

Annualised NAV total return is calculated as the return of the net asset value ('NAV') per share compounded on a quarterly basis, based on reported NAV per share from inception to 30 September 2024. NAV total return is inclusive of all dividends received since inception and assumes all dividends are reinvested at the time they are received and generate the same return as NAV per share during each reporting period.

 

Assuming dividends are not reinvested results in an annualised NAV total return of 10.7 % since inception.

 

Discount

The amount by which the market price per share is lower than the net asset value ('NAV') per share of an investment trust. The discount is normally expressed as a percentage of the NAV per share.

 

		As at 30 September 2024	As at 30 September 2023
Share price (p)	a	535.0	442.0
Net Asset Value per share (p)	b	780.1	777.7
Discount (%)	c = (b-a) / b	31.4	43.2

 

Dividend yield

The total dividend per Ordinary Share in respect of the financial year divided by the share price, expressed as a percentage, calculated at the year-end date of the Company.

 

		As at 30 September 2024	As at 30 September 2023
Dividend per share (p)	a	16.8	16.0
Share price (p)	b	535.0	442.0
Dividend yield (%)	c = a / b	3.1	3.6

 

Gearing

Gearing refers to the ratio of the Company's debt to its equity capital. The Company may borrow money to invest in additional investments for its portfolio.

 

NAV total return ('NAV TR')

NAV TR shows how the NAV has performed over a period of time in percentage terms, taking into account both capital returns and dividends paid to shareholders. This involves reinvesting the net dividend into the NAV at the end of the quarter in which the shares go ex-dividend. Returns are calculated to each quarter-end in the year and then the total return for the year is derived from the product of these individual returns.

 

NAV per share (p) as at 30 September 2023	a	777.7
NAV per share (p) as at 30 September 2024	b	780.1
Price Movement	c = (b/a) - 1	0.3%
Dividend Reinvestment1	d	2.1%
NAV Total return	e = c + d	2.4%

 

1 NAV TR assumes investing the dividend in the NAV of the Company on the date on which that dividend goes ex-dividend.

 

Ongoing charges ratio ('OCR')

The ongoing charges ratio is calculated as management fees and all other recurring operating expenses that are payable by the Company, excluding the costs of purchasing and selling investments, performance fees, finance costs, taxation, non-recurring costs, and the costs of any share buyback transactions, expressed as a percentage of the average NAV during the period.

 

The OCR previously included an allocation of the look-through expenses of the Company's underlying investments, excluding performance-related fees. However, in accordance with the AIC SORP, the Board agreed that it is not appropriate for PPET to include in its own cost disclosures, on a 'look through' or any other basis, all or part of any costs incurred by its underlying investments. This is in line with the approach adopted by PPET's peers.

 

The ongoing charges ratio has been calculated in accordance with the applicable guidance issued by the AIC.

 

		Year ended 30 September 2024 £'000	Year ended 30 September 2023 £'000
Investment management fee	a	11,412	11,213
Administrative expenses	b	1,269	1,234
Ongoing charges	c = a + b	12,681	12,447
Average net assets	d	1,200,147	1,175,937
Ongoing charges ratio	e = c / d	1.06%	1.06%1

 

¹ In the Annual Report to 30 September 2023, this was reported as the Total Expenses Ratio. The Ongoing Charges Ratio was reported as 2.84% and included an element of lock-through costs.

 

Over-commitment ratio

Outstanding commitments less cash and cash equivalents and the value of undrawn loan facilities divided by portfolio NAV.

 

		As at 30 September 2024 £000	As at 30 September 2023 £000
Undrawn Commitments	a	652,708	651,991
Less undrawn loan facility	b	(159,384)	(197,720)
Less cash and cash equivalents	c	(158,354)	(9,436)
Net outstanding commitments	d = a + b + c	334,970	444,835
Portfolio NAV	e	1,177,106	1,261,995
Over-commitment ratio	f = d / e	28.5%	35.2%

 

Share price total return

The theoretical return derived from reinvesting each dividend in additional shares in the Company on the day that the share price goes ex-dividend.

 

Date		Share price (p)
Share price (p) as at 30 September 2023	a	442.0
Share price (p) as at 30 September 2024	b	535.0
Price Movement (%)	c = (b / a) - 1	21.0%
Dividend Reinvestment (%)1	d	3.9%
Share price total return	e = c + d	24.9%

 

1 Share price total return assumes reinvesting the dividend in the share price of the Company on the date on which that dividend goes ex-dividend.

 

 

The financial information set out above does not constitute the Company's statutory accounts for the years ended 30 September 2024 or 2023 but is derived from those accounts. Statutory accounts for 2023 have been delivered to the registrar of companies, and those for 2024 will be delivered in due course. The auditor has reported on those accounts; their reports were (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006

 

The statutory accounts for the financial year ended 30 September 2024 have been approved by the Board and audited but will not be filed with the Registrar of Companies until after the Company's Annual General Meeting which will be held on 25 March 2025 at 12:30pm at 12 Hay Hill, Mayfair, London, W1J 8NR.

 

The Annual Report will be posted to shareholders shortly and copies are available from the Manager or from the Company's website (www.patriaprivateequitytrust.com).

 

 

For Patria Private Equity Trust plc

GPMS Corporate Secretary Limited, Company Secretary

 

For further information, please contact:
For Patria Private Equity Trust plc
Alan Gauld, Fund Manager	[email protected]
Investec Bank plc	+44 (0)20 7597 4000
Lucy Lewis
Tom Skinner
Denis Flanagan
SEC Newgate (For Media)
Sally Walton	+44 (0)20 3757 6872 [email protected]

 

* Neither the Company's website nor the content of any website accessible from hyperlinks on it (or any other website) is (or is deemed to be) incorporated into, or forms (or is deemed to form) part of this announcement.