Annual Report and
Financial Statements
Baillie Gifford
European Growth
Trust plc
30 September 2025
Notes
None of the views expressed in this document
should be construed as advice to buy or sell a
particular investment.
Investment trusts are UK public listed companies
and as such comply with the requirements of the
Financial Conduct Authority (‘FCA’). They are not
authorised or regulated by the FCA.
Baillie Gifford European Growth Trust plc currently
conducts its affairs, and intends to continue to
conduct its affairs, so that the Company’s ordinary
shares can qualify to be considered as a mainstream
investment product and can be recommended by
Independent Financial Advisers to ordinary retail
investors in accordance with the rules of the FCA in
relation to non-mainstream investment products.
This document is important and requires your
immediate attention.
If you reside in the UK and you are in any doubt as to
the action you should take, you should consult your
stockbroker, bank manager, solicitor, accountant
or other independent financial adviser authorised
under the Financial Services and Markets Act 2000
immediately. If you reside outwith the UK, you should
consult an appropriately authorised financial adviser.
Investor Disclosure Document
The UK Alternative Investment Fund Managers Regulations require
certain information to be made available to investors prior to their
investment in the Company. The Company’s Investor Disclosure
Document is available for viewing at bgeuropeangrowth.com
If you have sold or otherwise transferred all of your
holding in Baillie Gifford European Growth Trust
plc, please forward this document, together with
accompanying documents, but not your personalised
form of proxy, as soon as possible to the purchaser
or transferee, or to the stockbroker, bank or other
agent through whom the sale or transfer was or
is being effected for delivery to the purchaser or
transferee.
Cover image: Aurora Borealis over Tromsø
innorthern Norway.
01
Baillie Gifford European Growth Trust plc
Introduction
Financial highlights 02
Baillie Gifford – philosophy and process 04
Strategic report
Chairman’s statement 07
Managers’ report 11
Review of investments 18
One year summary 22
Five year summary 24
Ten year record 26
Business review 28
Baillie Gifford statement on stewardship 41
Environmental, social and governance engagement 42
Baillie Gifford – proxy voting 45
List of investments 46
Distribution of total assets 48
Governance report
Directors and management 50
Directors’ report 53
Corporate governance report 58
Audit Committee report 65
Directors’ remuneration report 68
Statement of Directors’ responsibilities 72
Financial report
Independent Auditor’s report 75
Income statement 82
Balance sheet 83
Statement of changes in equity 84
Cash flow statement 85
Notes to the Financial Statements 86
Shareholder information
Notice of Annual General Meeting 103
Further shareholder information 109
Communicating with shareholders 111
Third party data provider disclaimer 114
Sustainable Finance Disclosure Regulation 115
Glossary of terms and alternative performance measures 116
Company information 119
Contents
Introduction
Annual Report and Financial Statements 2025
02
Financial highlights
Year to 30 September 2025
Share price
*
14.5%
NAV (borrowings
at book value)
*
†
5.2%
NAV (borrowings
at fair value)
*
†
5.5%
Comparative
index
*
#
15.5%
* Alternative performance measure – see Glossary of terms and alternative performance measures on pages 116 to 118.
†
Key Performance Indicator.
#
The benchmark is the FTSE Europe ex UK Index (in sterling terms).
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 114.
Past performance is not a guide to future performance.
Baillie Gifford European Growth Trust
plc aims to achieve capital growth over
the long-term from a diversified portfolio
of European securities.
NAV, share price and benchmark total return
*
(figures rebased to 100 at 30 September 2025)
Discount to net asset value (borrowings at fair value)
*
(figures plotted on a weekly basis)
S
2025
S
2024
ONDJF MAM J
JA
●
Share price*
●
NAV*
†
●
Benchmark*
#
90
120
110
100
2025
2024
S
SO NDJFMAMJ
JA
●
Discount*
●
Average discount
(18%)
(15%)
(12%)
(9%)
(6%)
Total returns
Baillie Gifford European Growth Trust plc
03
Introduction
Annual Report and Financial Statements 2025
04
Baillie Gifford –
philosophy and process
Our philosophy
To generate remarkable returns over time we strongly
believe that our investment philosophy and process
need to break from convention. Since the inception
of our first European equities strategy in 1985 we
have been working on this very task. We have always
believed that being longer-term than most and being
truly active would tip the odds of outperforming in
ourfavour.
Now however, we also have a much greater
understanding of the hidden asymmetry in equity
markets. Wealth creation and outperformance are
not generated by lots of slightly better-than-average
companies; they are generated by a very small
number of special companies that go on to produce
huge returns over long periods of time. These are
the outliers we are looking for.
They endure and prosper thanks to attractive growth
opportunities and unique corporate cultures that
translate into strong competitive advantages. They
are mostly owned or managed by entrepreneurial
founders, families or other inside owners, who tend
to focus more on sustainability and protecting the
interests of employees and customers.
Our philosophy and process have evolved over time
to give ourselves the best chance of finding these
outliers, and to own them for the long-term. We
need to think in decades rather than quarters; we
need differentiated sources of insight; we need to
think about what might go right rather than wrong;
and we need to have the right corporate culture that
encourages and supports our way of thinking.
Long-term
We believe great businesses can be structurally
mispriced as the market often underestimates their
durability and attractiveness. At the same time, most
investors have a time horizon that is far too short to
fully appreciate the potential of outstanding
businesses; they are neither willing nor able to align
themselves with the timescale of achievement of
great businesses.
Capturing significant upside requires the adoption
ofa long-term mindset: we must think about
companies, their progress and opportunities, not in
months and quarters but in years and decades. We
must have the courage and conviction to own
businesses through thick and thin. While in
aggregate our average holding period will typically
be between five and ten years, implying a portfolio
turnover of 10–20%, we are likely to hold individual
companies for a much longer period.
Growth
We are looking for each company we invest in to have
the potential to at least double in value on a five year
view. Our analysis shows this is correlated with
earnings growth rather than a change in valuation. For
that reason, we focus on companies that have large,
structural growth opportunities, and that are capable
of reinvesting at high rates of return as a result of
strong competitive advantages.
Baillie Gifford European Growth Trust plc
05
Optimism
Thinking creatively and optimistically are critical
underpinnings if we are aiming to invest in Europe’s
outliers. We need to think about what can go right,
rather than what can go wrong in an investment
case. We need to be willing to embrace uncertainty
and recognise that we will make mistakes. We need
to recognise that returns in equity markets are
asymmetric, with the maximum loss capped to the
initial stake and the upside unbounded. In our
portfolios, the driving force behind returns is not the
occasional misstep, but rather the highly successful
investments. As humans, we are programmed to
dislike losses far more than we enjoy gains. However,
we know that stock market returns are highly
skewed, with overall returns dominated by a small
subset of outliers. We must guard against this
cognitive bias and remain resolute in our pursuit of
investing in Europe’s great growth companies.
Bottom-up approach
We believe investors spend too much time worrying
about top-down, macroeconomic considerations
which are highly unpredictable and outwith their
control. We are bottom-up stock pickers and
approach investing with the view to become a
long-term owner in a select number of fundamentally
attractive businesses. We devote our time and
energy to gaining a deep understanding of what
drives success in business in general, and in the
case of specific companies. We seek out
differentiated sources of information to enable
ustogain differentiated insights.
The Strategic report, which
includes pages 7 to 48 and
incorporates the Chairman’s
statement, has been prepared in
accordance with the Companies
Act 2006.
Strategic
report
07
Baillie Gifford European Growth Trust plc
Chairman’s
statement
Introduction
This is the first year of reporting since the
introduction of the four-year performance-
related tender offer. The broad rationale for this
was set out in last year’s Annual Report by my
predecessor as Chairman. The conditional tender
clearly encapsulates the Board’s expectations of
our Manager: we believe in Baillie Gifford’s ability
to identify and build a portfolio of companies
with long-term growth potential. We recognise
successful active investment requires patience
and the willingness to be different, but equally, we
recognise that all active managers have ultimately to
outperform benchmarks. Performance is discussed
in greater depth below and in the Manager’s Report,
however, there are signs, particularly in the second
half of the year, that performance is improving.
While broader indices have benefited from
a narrow concentration of performance in a
few large companies, the Company’s portfolio
continues to reflect Baillie Gifford’s conviction
in long-term, fundamental growth opportunities
across the continent. The Managers remain
focused on investing in exceptional businesses
that can compound value over many years, even
if this approach, at times, leads to periods of
underperformance. During the year, the Board
has with the Managers, looked at process around
portfolio construction and the Board is encouraged
by the resilience of the portfolio companies and by
signs of improving operational performance across
several core holdings.
David Barron
Chairman
Appointed to the
Board in 2023
and as Chairman
in 2025
Strategic report
Annual Report and Financial Statements 2025
08
We set out below the performance of the Company
since the significant macro shift referred to above.
For the sake of clear presentation, we take these
from 1 October 2022.
NAV Share Price
Benchmark
*
1 October 2022 –
30 September 2023
8.3% 8.6% 20.5%
1 October 2023 –
30 September 2024
12.1% 9.3% 15.3%
1 October 2024 –
30 September 2025
5.5% 14.5%
15.5%
It is encouraging that performance improved in
the second half of this reporting year. In addition,
as set out on page 30 of this Annual Report in
the discussion on Key Performance Indicators,
the Board considers peer group comparative
performance and over shorter periods, this too is
more competitive.
Private Companies
During the year, the Board has spent significant time
with the Fund Managers and Baillie Gifford’s Private
Companies team, in order to re-assess the rationale
for the Company to hold unquoted businesses within
a largely listed portfolio.
The Board concluded, following these most recent
discussions, that limited exposure to private
companies can provide access to distinct growth
opportunities and a source of differentiated returns.
Despite the significant setback in two investments,
Baillie Gifford’s network, expertise and resources
position them to successfully identify, execute and
manage such opportunities.
Private companies can be harder to realise and
may be viewed as complex. However, as a long-
term vehicle with structural advantages, we would
not wish to exclude this area of the market if that is
where the Managers believe they can add significant
value. The investment made in Tekever this year was
the first new private investment since 2023. Asat
the year-end, unquoted companies represented
13.6% of the portfolio, driven in large part by the
performance of Bending Spoons, that the Managers
highlight in their report.
The Board believes that good outcomes can be
achieved by using the advantages of the investment
trust structure: gearing, a meaningful exposure to
unlisted companies and a willingness to diverge
from the benchmark. Our active share is over 80%
and the turnover is 22.8%. Notwithstanding the
difficult performance record of recent years, we
continue to encourage the Managers to remain
consistent in their approach and to invest with
conviction in companies they believe are positioned
to outperform.
Performance
The net asset value per share (‘NAV’) total return
over the Company’s financial year was 5.5%
compared to a total return of 15.5% for the FTSE
Europe ex UK Index, in sterling terms.
In the second half of the year the NAV total return
was 12.6% compared to a total return of 11.6% for
the index.
The share price total return over the year was 14.5%
and so the discount to NAV of the Company’s shares
narrowed from 15.7% to 8.6%.
NAV Share Price
Benchmark
*
1 October 2024 –
31March 2025
(6.7%) 1.3% 3.5%
1 April 2025 –
30September 2025
12.6% 13.0%
11.6%
Since Baillie Gifford began managing the portfolio
in November 2019, the NAV total return has been
28.5% compared to a total return of 66.2% for the
FTSE Europe ex UK Index, in sterling terms. The
share price total return has been 27.8%, with the
discount widening slightly from 7.5% to 8.6%.
The Manager and the Board are focused on
re-building the performance record going forward.
In 2019, following Baillie Gifford’s appointment as
Managers, macro conditions were initially uniquely
favourable to Baillie Gifford’s style. The subsequent
macro environment presented significant challenges
to performance, amplified by certain stock-specific
developments and portfolio allocation decisions.
Since 2022, the Company has been operating
against a very different market environment where
the backdrop for growth companies has been far
less universally supportive.
* The benchmark is the FTSE Europe ex UK Index, in sterling terms.
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 114. All figures are stated on a total return basis. Total return
and discount are an alternative performance measures – see Glossary of terms and alternative performance measures on pages 116 to 118.
Past performance is not a guide to future performance.
09
Baillie Gifford European Growth Trust plc
Earnings and Dividend
Revenue per share for the year was 0.78p (0.72p
2024) and the Board is recommending a final
dividend of 0.72p per share (0.60p 2024). Subject to
shareholder approval at the Annual General Meeting,
the dividend will be paid on 13 February 2026 to
shareholders on the register on 9 January 2026.
Theex-dividend date will be 8 January 2026.
As noted in the Company’s 2019 Annual Report,
any dividend paid will be by way of a final dividend
and be the minimum required for the Company to
maintain its investment trust status.
Borrowings
The Company has two €30 million long-term debt
facilities: the first has a remaining duration of
15years and is priced at a fixed rate of 1.57% and
the other has over 10 years outstanding at a fixed
rate of 1.55%. The Company also has an undrawn
€30million overdraft facility with The Northern
Trust Company, which at present is capped at
€15million following Board agreement. At the year
end, the Company had net gearing of 14.0% of
shareholders’funds.
Share Buybacks, Issuance and Discount
As well as a focus on re-building the Company’s
performance track record, the Board is very aware of
the rating at which the shares of the Company trade.
Over the course of the Company’s financial year,
the share price moved from a 15.7% discount to
NAV to a 8.6% discount to NAV. During this period,
the Company bought back 27,060,412 shares at a
total cost of approximately £26.9m. This represents
approximately 7.7% of the issued share capital at
the start of the year. By way of comparison, the
equivalent figure last was 6.3m shares or 1.8% of
the Company’s issued share capital. The shares
repurchased by the Company are held in treasury
and are available to be reissued, at a premium, when
market conditions allow.
The Board will continue to operate its buyback policy
whilst ensuring that the integrity of the closed-ended
structure, that we believe has significant advantage,
is preserved. The Company is capitalised at over
£330m and has a gross portfolio of over £400m. The
shrinkage through buybacks does not unduly impact
our competitive expense ratio of 0.66%.
The competition for investor attention amongst
funds and investment trusts has never been greater.
Investment trusts need to remain relevant. We
believe by having a distinctive investment approach
and by utilising the structural advantages of an
investment trust, we can deliver the investment
performance and returns that underpin success and
lead to greater demand for the Company’s shares.
The Board is of the view that the Company should
retain the power to buy back shares during the year
and so, at the Annual General Meeting, is seeking
to renew the annual authority to repurchase up
to 14.99% of the shares in the Company in issue.
When buying back shares, the Board does not have
a formal discount target and is prepared to buy back
shares opportunistically and where it is accretive
toNAV.
The Company also has authority to issue new
shares and to reissue any shares held in treasury
for cash on a non-pre-emptive basis. Shares are
issued/reissued only at a premium to net asset
value, thereby enhancing net asset value per share
for existing shareholders. The Directors are, once
again, seeking 10% share issuance authority at
the Annual General Meeting. As with the buy back,
this authority would expire at the conclusion of the
Annual General Meeting to be held in 2027.
Annual General Meeting
The AGM will be held at 2.00pm on 4 February 2026
at One Moorgate Place, City of London EC2R 6EA.
Please see pages 103 to 108 that sets out the AGM
location and directions thereto. The Managers will
make a presentation and I look forward to meeting
shareholders who are able to attend.
To accurately reflect the views of shareholders of
the Company, the Board intends to hold the AGM
voting on a poll, rather than by a show of hands. This
will ensure an exact and definitive result. The Board
encourages all shareholders to exercise their votes
on the AGM resolutions by completing and submitting
the form of proxy enclosed with the Annual Report
to ensure that your votes are represented at the
meeting (whether or not you intend to attend in
person). Ifyouhold shares through a share platform
or other nominee, the Boardencourages you to
contact these organisations directly as soon as
possible to arrange for you to submit votes in
Strategic report
Annual Report and Financial Statements 2025
10
advance of the AGM. Alternatively,theAssociation
of Investment Companies’ (‘AIC’) website
theaic.co.uk/how-to-vote-your-shares has information
on how to vote your shares if you hold them via one
of the major platforms. The following link will also
take you through to the AIC website where there is
information on how your platform can help you attend
the AGM in person theaic.co.uk/aic/ready-to-invest/
shareholdervoting/attending-an-agm.
Should shareholders have questions for the Board or
the Managers or any queries as to how to vote, they
are welcome, as always, to submit them by email to
enquiries@bailliegifford.com or call 0800 917 2113.
Information on the resolutions can be found
on pages 55 and 56 of the Annual Report and
Financial Statements. The Directors consider that
all resolutions to be put to shareholders are in their
and the Company’s best interests as a whole and
recommend that shareholders vote in their favour.
Outlook
Even though the macro backdrop against which we
invest is unpredictable, we believe the Managers are
well-placed to identify dynamic, growing European
businesses that can prosper over the long-term in
industries where management can shape the destiny
of the business.
Baillie Gifford’s approach is avowedly long-term,
patient and different from many of the competition.
With good execution, the Board believes this
is a sound basis for successful active portfolio
management. During the year, the Managers have
improved the quality and breadth of the portfolio
whilst remaining consistent to this approach. Many
of the companies we own are delivering strong
operating performance and excellent results,
growing at attractive rates.
This gives us confidence that early signs of
performance improvement during the second half
ofthe year can be continued into next year.
David Barron
Chairman
8December 2025
11
Baillie Gifford European Growth Trust plc
Managers’
report
For a definition of terms see Glossary of terms and alternative performance measures on pages 116 to 118.
Past performance is not a guide to future performance.
Over the past financial year, the Company’s net
asset value (NAV) total return was 5.5%, compared
with a 15.5% return from the FTSE Europe ex
UK Index (in sterling terms). All of the relative
underperformance occurred in the first half of the
year, as discussed in the Interim Report. While this
outcome was disappointing, it was encouraging that
both NAV and share price total returns outperformed
the index in the second half of the year, by 1%
and 1.4% respectively. This improvement reflects
the steps taken to reposition the portfolio and to
broaden the range of growth companies we invest in.
Recent results have also benefited from improving
momentum, particularly among our private holdings
such as Bending Spoons.
Although the environment has been challenging
for growth investing – the European growth index
has underperformed its value counterpart for five
years – these results strengthen our conviction in
the portfolio’s underlying quality and our belief that
performance should continue to recover as market
conditions evolve. The macroeconomic outlook
for Europe is improving, and valuations seem to
us to be very attractive. In the absence of inflation
or interest rate shocks, we would expect that the
share prices of our portfolio companies will revert to
following fundamentals. We also expect that these
companies will continue to increase sales and profits
faster than the average company in Europe, giving
us confidence that we are moving past the trough of
our performance cycle.
Stephen Paice
Investment Manager
Chris Davies
Investment Manager
Strategic report
Annual Report and Financial Statements 2025
12
Market Environment and Positioning
If the pain trade in the US has been not owning the
“Magnificent Seven” tech companies, in Europe it
has been not owning Banks, and to a lesser extent,
defence companies. Banks have benefitted from
higher interest rates while defence companies have
benefitted from a renewed focus on geopolitical
safety. As domestic sectors, both have been seen
as safe havens from those seeking to avoid the
uncertainty of Trump’s tariffs. We do own Tekever,
a Portuguese Drone company, that should benefit
from NATO’s pledge to spend up to 5% of GDP on
defence and also the increasing role of unmanned
systems in modern warfare. However, we currently
hold no European banks and continue to believe
that, in aggregate, the sector offers limited long-
term opportunity. Many European banks are
structurally disadvantaged and trade at premium
valuations that do not, in our view, reflect their
longer-term challenges.
Volatility spiked in April after President Trump
announced broad new tariffs on his wryly named
‘Liberation Day’. Although the most punitive
proposals were later moderated, the episode
reignited concerns about trade, inflation, and global
growth. Risk appetite cooled, corporate guidance
turned cautious, and capital flowed into the
perceived safety of Europe’s domestic companies.
Meanwhile, the excitement around artificial
intelligence (AI) that buoyed parts of the US market
failed to generate a comparable lift in Europe.
For bottom-up growth investors, this confluence
– a benchmark led by sectors we choose not
to own, cyclical softness across industry, and a
market bias toward immediate evidence – formed
an unfavourable backdrop. There has been no
‘Liberation Day’ for European growth portfolios.
Nonetheless, our philosophy remains unchanged.
We aim to back exceptional businesses with
enduring advantages and the capacity to compound
value over years rather than months. The portfolio
is not managed to mirror the index. We accept that
there will be phases when other styles are rewarded.
Historically, our strongest long-term outcomes have
often followed periods when we were most out of
step with prevailing fashion, precisely when patience
and conviction are scarcest.
Looking ahead, we remain encouraged by the
structural forces supporting European growth.
Digitalisation and AI continue to reshape industries
from media to financial services. It is no coincidence
that our five largest holdings – Bending Spoons,
Prosus, Topicus.com, ASML, and Adyen – are all
technology companies that stand to benefit directly
from these transformative trends. While most
businesses will gain from these advances, these
firms should see their competitive moats widen and
profitability improve more than most. The energy
transition is also catalysing innovation in materials,
logistics, and industrial processes, while healthcare
is being transformed by data-rich diagnostics and
targeted therapies. In private markets, a growing
5 year Cumulative Total Return
MSCI Europe ex UK Growth vs Value
Sep-20
Dec-20
Mar-21
Jun-21
Sep-21
Dec-21
Mar-22
Jun-22
Sep-22
Dec-22
Mar-23
Jun-23
Sep-23
Dec-23
Mar-24
Jun-24
Sep-24
Dec-24
Mar-25
Jun-25
Sep-25
-20%
0%
20%
40%
60%
80%
100%
120%
Cumulative Total Return (GBP)
● MSCI Europe ex UK Growth
●
MSCI Europe ex UK Value
Source: Factset. The chart compares the MSCI Europe ex UK indices rather than the FTSE Europe ex UK Index (which is the Company’s benchmark).
13
Baillie Gifford European Growth Trust plc
cohort of founder-led European companies is
building valuable franchises away from public
market scrutiny. Much of tomorrow’s leadership is
being forged today, often behind closed doors, and
we intend to be constructive, long-term partners
in that process. In our view, it is only a matter of
time before innovation and structural growth are
rewarded again.
Performance Review
Several holdings delivered strong operational
progress that translated into meaningful valuation
gains over the period. The standout performer was
Bending Spoons, our largest private holding, which
generated a 258% return and now represents
approximately 10% of NAV. We also saw strong
performance from other holdings, including Spotify,
Ryanair, and Prosus.
Spotlight on Bending Spoons
Highlighting the largest and best-performing
company in any portfolio always carries some risk if
things don’t go as expected. But we believe in being
transparent, and since we view Bending Spoons as
a truly special business, we think it is a risk worth
taking. This Milan-based technology company
has become one of Europe’s most accomplished
software operators. Founded in 2013 by Luca Ferrari
and four friends, it acquires and operates digital
products, from mobile apps and SaaS platforms to
subscription tools, underpinned by a proprietary,
data-driven operating model.
The company’s success rests on two interlocking
pillars. The first is its disciplined acquisition strategy.
It typically makes just a few sizeable acquisitions
each year, which are integrated into a central
technology stack powered by internal AI systems
that automate analytics, monetisation, and parts of
product engineering. This unlocks pricing power,
and when combined with a rigorous approach to
efficiency, acquired businesses become much more
profitable with remarkable speed. These profits can
then be redeployed in further acquisitions, thus
driving a flywheel.
The second pillar is its distinctive culture, defined
by talent density, radical candour, and relentless
optimisation. Recruitment is exceptionally selective:
more than 600,000 applicants competed for
fewer than 300 roles last year, with only the most
capable joining what Ferrari calls the “A-team”.
Ithasbecome one of the most coveted destinations
in European technology. The ambition is simple and
clear: to keep doing the same things, but better,
compounding their advantage year after year.
Execution has been exceptional. Returns on
acquisitions have been consistently high, reflecting
both the firm’s technology-enabled operating model
and its ability to attract world-class talent. Unlike
conventional software roll-ups, Bending Spoons
focuses on fewer, larger acquisitions where post-
transaction transformation is meaningful. Ferrari
epitomises the firm’s ethos – engineering-led,
transparent, and humble – and remains aligned,
along with the other founders, with a significant
stake in the business.
In our view, Bending Spoons demonstrates that
Europe can build globally relevant, highly profitable
technology franchises outside public markets. It
is also important to note that our recent internal
review supports our belief that the company could
be worth a lot more in the future despite its positive
contribution to returns so far.
Other Positive Contributors
Spotify, the world’s largest audio-streaming platform
now serving roughly 700 million monthly users,
continued to exceed expectations. Management’s
focus on operational efficiency and measured price
increases helped lift margins. Even though most
of us now have higher monthly subscription fees,
user churn was minimal which is a great indication
of continued willingness-to-pay. The investment
case remains anchored in scale advantages, rapid
product innovation, and the optionality of new
verticals within audio and subscription services.
Ryanair also delivered an impressive year as travel
demand across Europe remained resilient. In the
June quarter alone, the airline reported a net profit
of €820 million, with average fares up 21% and unit
costs rising just 1%. Its enduring cost leadership,
prudent capacity management, and well-timed fuel
hedging delivered record profitability, while the
balance sheet remained rock-solid with net cash
of around €2 billion. Ryanair’s operational rigour
and disciplined capital allocation continue to set
the benchmark in the industry, and like Spotify, we
would expect pricing to be a key driver of increased
profits from here.
Strategic report
Annual Report and Financial Statements 2025
14
Prosus, the global consumer internet investor,
was another important contributor. After years of
market fixation on its Tencent stake, the company’s
non-Tencent e-commerce portfolio achieved a
significant milestone in generating positive free
cash flow for the first time. Profitability improved
across online classifieds, payments, and food
delivery, and new CEO Fabricio Bloisi articulated
credible medium-term goals, including a doubling
of e-commerce revenues by 2028. Share buybacks
also continued, which are aimed at further
narrowing the discount to NAV. Tencent, the largest
social media platform in China and the largest
gaming company in the world, will still drive most
of the performance from here, but it is encouraging
to see the rest of Prosus’ portfolio starting to
contribute positively.
These three companies have been in the portfolio
since we started managing it in 2019. While
operating in very different industries, they share
some common characteristics: they are managed
by extremely ambitious entrepreneurs that have
meaningful levels of ownership, they have dominant
market shares, their customers value their products
and services (yes, even Ryanair!), and they are
now at the stage of being able to monetise years
of investment. It has not been plain sailing though.
These companies have also suffered from periods
of share price weakness and volatility. However,
by remaining patient and focusing on their
fundamentals, we’ve been able to benefit from
improving momentum. This is what we expect to see
from many more companies in the portfolio in the
coming years.
Negative Contributors
Not all holdings advanced in tandem. Several
otherwise strong businesses faced cyclical
headwinds or valuation pressures, leading to weaker
share price performance.
Hypoport, the German fintech platform for mortgage
brokerage, was the largest detractor. The domestic
housing market remained subdued following the
sharp rise in interest rates and sentiment towards
the sector has been understandably cautious. While
Hypoport’s earnings began to recover in 2025, its
recovery was temporarily held back by lower activity
at one of its customers who had to deal with some
IT issues. From here though, we expect the housing
market to rebound, and for Hypoport to continue
winning market share.
IMCD, the specialty chemicals distributor, also
experienced a temporary slowdown. After years of
exceptional growth, customer destocking weighed
on demand, leading to only 2% organic revenue
growth in the first half of 2025 and mild margin
compression. In a normal environment it should
be able to grow organically around 5% and also
add the same on again from acquisitions given its
position as the natural consolidator in the industry.
For this type of growth profile, the decade-low
valuation multiple strikes us as extremely
goodvalue.
Soitec, the French producer of engineered
semiconductor substrates, underperformed as
its core markets – smartphones, automotive, and
internet of things (IoT) – softened. The company’s
recovery will depend on a broader cyclical upturn,
however the CEO has recently resigned and
following another profit warning, the investment
case is under review.
Novo Nordisk detracted following two profit
warnings, driven by supply constraints and
heightened competition from Eli Lilly’s Mounjaro/
Zepbound. Margin-dilutive exclusivity deals and
leadership turnover compounded investor unease.
Yet the fundamental picture remains robust: Novo
supplies over 60% of global GLP-1 volumes,
demand is rising rapidly, and its data continue to
reinforce a clear clinical and commercial edge. The
company’s significant investment programme should
alleviate supply bottlenecks and support future
growth. Despite near-term headwinds, Novo remains
a cornerstone European growth company with
pricing power, strong margins, and a long runway
forexpansion.
While the Company’s one-year results remain
disappointing relative to the benchmark, we are
encouraged by evidence of operational progress
across much of the portfolio. The relative shortfall
largely reflects our deliberate underweight exposure
to sectors – such as banks and energy – that
have limited alignment with our growth criteria.
We continue to focus on building a distinctive,
long-term portfolio of European growth businesses,
guided by fundamentals rather than fashion. The
tangible improvements seen at companies such
as Spotify and Prosus provide a solid foundation
for future returns. Periods like this test conviction,
but we remain steadfast in our belief that enduring
company fundamentals, not short-term rotations,
drive sustainable shareholder value.
15
Baillie Gifford European Growth Trust plc
Portfolio Activity
Portfolio turnover remained high in the second
half of the financial year as we identified new
opportunities and rebalanced towards holdings with
greater resilience and growth potential. This is most
evident in our relative sector positioning versus the
index shown below. A year ago, we were nearly 9%
overweight in Industrials and 7% underweight in
Health Care. Today, our exposure to Industrials is
closer to neutral, while Health Care has moved to a
2% overweight. To be clear, these changes primarily
reflect where we have found the most attractive
companies trading at the most mispriced valuations.
Relative Sector Bets vs Index
● 2024 Relative Weight
●
2025 Relative Weight
-20
-15
-10
-5
0
5
10
15
20
25
Technology Industrials Consumer
Discretionary
Real Estate Basic
Materials
Telecoms Energy Utilities Consumer
Staples
Health Care Financials
Source: Baillie Gifford / FTSE. The chart shows the relative weights vs FTSE Europe ex UK.
We initiated positions in five companies – Grupa
Kęty, Amplifon, Roche, Sandoz, and Tekever –
spanning industrials, healthcare, and defence
technology. Each shares the defining characteristics
we seek: underappreciated growth, strong and
improving competitive advantages, disciplined
management, and attractive entry valuations.
Grupa Kęty is a leading producer of aluminium
products and packaging. The company has
demonstrated a decade-long record of profitable
growth, delivering approximately 13% annual sales
growth and 17% operating profit growth while
maintaining consistently high returns on capital. Its
ongoing reinvestment programme continues to shift
the business mix toward higher-value segments.
Grupa Kęty also pursues selective acquisitions to
enhance its capabilities. Despite these strengths,
it remains under-researched outside its domestic
market. We were able to establish a position at
what we judged to be an undemanding valuation,
one that did not fully reflect the company’s quality
or long-term prospects. We believe steady demand
in construction and automotive, combined with
product-mix improvements, will support attractive
compounding returns.
Amplifon is the world’s largest hearing-care
retailer, operating through more than 10,000
points of sale. Growth has slowed in recent years
due to an unfavourable product cycle, prompting
a sharp pullback in the valuation. We viewed this
as a temporary dislocation rather than structural
weakness. As the upgrade cycle resumes and the
company continues to consolidate a fragmented
market, we expect both growth and margins to
recover. Demographic tailwinds, notably ageing
populations and greater awareness of hearing
health, underpin a compelling long-term demand
profile. Amplifon’s scale, brand strength, and cash
generation give it both the resilience and flexibility
to capitalise on these trends.
Roche is one of the world’s leading global
pharmaceutical companies. It generates more
than €10 billion in free cash flow annually and has
been investing consistently in an innovation-led
pipeline spanning oncology, immunology, and other
key therapeutic areas. While recent years brought
pipeline setbacks and patent expiries, we believe
the outlook is improving as the company continues
to revitalise. Management has tightened research
discipline and is deploying computational AI tools
more extensively in drug discovery and development.
Strategic report
Annual Report and Financial Statements 2025
16
Roche is also entering new therapeutic areas,
including obesity, hypertension and Alzheimer’s,
with multiple launches expected before 2030.
We see the market as undervaluing the breadth
and quality of Roche’s pipeline, as well as its
capital-allocationacumen.
Sandoz, which spun-out of Novartis in 2023, is
one of the world’s largest generics and biosimilars
companies. The business is transitioning toward
higher-margin products, notably biosimilars, which
are expected to drive most of its future growth.
A$400bn patent cliff in biologics provides a
long runway for opportunity. We believe Sandoz’s
pipeline, scale, and partnerships position it well to
gain share. With a low valuation multiple, it offers a
rare blend of defensiveness, cash generation, and
underappreciated growth.
We participated in a funding round for Tekever,
aprivate European defence-technology company
specialising in AI-enabled unmanned aerial
systems used in maritime surveillance, border
security, and other mission-critical applications.
Its technology is deployed by agencies such as
the European Maritime Safety Agency and the UK
Home Office, and has been used in active conflict
zones including Ukraine. After two decades of
disciplined development, the company raised
€70 million to scale production, in a round led
by Baillie Gifford alongside the NATO Innovation
Fund. Rising European defence spending and
the growing strategic importance of autonomous
intelligence and surveillance systems constitute
durable tailwinds. Tekever’s established customer
relationships and technical maturity provide a
credible path to scaling and maintaining its very
healthy level of profitability.
Sources of Funds
To fund these new investments, we sold three
holdings: VNV Global, Genmab, and Beijer Ref.
Limited transparency made assessment of VNV’s
underlying progress challenging, prompting a
redeployment of capital into companies where we
have clearer operational insight.
We also divested Genmab, the Danish biotech.
While it remains a leader in antibody therapeutics,
its revenue concentration in a few blockbuster
collaborations, notably Darzalex, presented an
asymmetric risk profile given the upcoming patent
expiration. Unfortunately, its next generation
Darzalex doesn’t look like it will be as successful as
we originally thought. We redeployed proceeds into
Roche, which offers broader exposure to healthcare
innovation at an appealing valuation.
Finally, we exited Beijer Ref, the Swedish distributor
of cooling systems. Following several years of strong
expansion and early signs of demand recovery, the
valuation had, in our view, already priced in much
of the cyclical upswing. We saw better risk-reward
potential in holdings where an inflection in growth
was less fully reflected in expectations.
Investing in Private Companies
Our private holdings, once a drag on performance,
became the main driver of returns this year,
delivering an exceptional 92% gain led by Bending
Spoons’ 258% rise. With an average weight of
9.3%, private investments accounted for nearly all
of the Company’s positive NAV movement. Since
2019, they have generated a cumulative return
of 141%, even after writing down Northvolt and
McMakler to zero, outperforming both peers and
our listed portfolio. As is typical in private markets, a
few exceptional successes drive most of the returns.
Of six investments made so far, one has been
outstanding, several are progressing, and two have
disappointed. This asymmetry is intrinsic to private
investing: a small number of winners can more than
offset occasional losses.
At year end, our four private holdings – Bending
Spoons (10% of NAV), sennder (2.9%), Tekever
(1.5%), and Flix (1.2%) – together represented
15.5% of net assets. Although our mandate allows
up to 20% in privates, this is a ceiling, not a target.
We invest selectively, deploying capital only where
opportunity, valuation, and risk adjusted return
align. Lessons from earlier experiences, particularly
Northvolt, have strengthened our process. We are
much more mindful of the time it takes to generate
positive cashflow and the levels of capital intensity.
Encouragingly, Bending Spoons and Tekever are
already profitable, sennder and Flix are approaching
breakeven, and they are all relatively asset light.
Baillie Gifford European Growth Trust plc
17
Our commitment to private investing reflects a
broader conviction: Europe’s most promising growth
companies increasingly remain private for longer,
with value creation front loaded before IPO. These
founder led, asset light businesses stand apart from
capital intensive incumbents, offering compelling
opportunity for patient investors. Our closed ended
structure and permanent capital allow us to embrace
this long term horizon, free from redemption
pressures. As a crossover investor, we can hopefully
identify exceptional companies early, back them
through late stage rounds, and continue supporting
them post IPO.
Outlook
The year highlighted a clear divide within the
portfolio: businesses capable of self-generated
growth through pricing power, innovation, or
scale – such as Spotify and Ryanair – versus those
temporarily constrained by cyclical headwinds in
housing, industrial demand, or inventory cycles.
As long-term investors, we view such divergences
as a natural part long-term and patient investing.
By backing structural growth rather than
chasing short-term trends, there will inevitably
be periods when relative performance lags a
value-drivenbenchmark.
Our focus remains firmly on fundamentals. Across
much of the portfolio, we see rising margins, robust
cash generation, and evidence of market-share
gains. These are indicators of intrinsic value creation
that, over time, should translate into stronger
returns. While macroeconomic headwinds from
inflation and geopolitics persist, the outlook appears
incrementally more stable. We do not manage to
macro forecasts, but we do consider scenarios
carefully, favouring companies with the capacity to
adapt across them.
Our task is unchanged: to maintain a high-quality
portfolio of European growth businesses capable
of compounding over the long term. With a broader
range of less correlated growth companies, the
renewed momentum in our private portfolio, and the
operational progress evident across key holdings,
we believe the Company is well positioned to deliver
attractive long-term returns.
We thank our shareholders for their continued
support and look forward to the year ahead with
both determination and optimism.
Stephen Paice
Chris Davies
Baillie Gifford
8 December 2025
Strategic report
Annual Report and Financial Statements 2025
18
Review of
investments
The Company’s ten
largest investments as at
30September 2025
Bending Spoons
Bending Spoons is a developer
and acquirer of digital consumer
applications. The company
leverages its shared set of tools to
use across different applications,
with the shared goal of maximising
long-term value creation while
simultaneously minimising customer
acquisition cost and improving the
product for consumers. Scaling
its current suite of applications
and strategically acquiring new
ones will be the key enabler of its
continuedsuccess.
Prosus
A global consumer technology
holding company that listed in
Europe in 2019. Its biggest and
most important asset is a stake in
Tencent, the founder-run, Chinese
social media and gaming giant. With
over 1.3bn monthly users and an
undermonetised platform, there are
ample opportunities for continued
profitable growth. We think Tencent
is mispriced, and as Prosus trades
at a significant discount to the
value of its assets, we think it’s even
moremispriced.
Geography Italy
Valuation at 30 September
2025 (£’000s)
35,298
% of net assets at
30September 2025
10.0
Valuation at 30 September
2024 (£’000s)
9,862
% of net assets at
30September 2024
2.7
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
–
Absolute performance (%)
*
257.9
Geography Netherlands
Valuation at 30 September
2025 (£’000s)
20,237
% of net assets at
30September 2025
5.7
Valuation at 30 September
2024 (£’000s)
23,328
% of net assets at
30September 2024
6.4
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
(10,349)
Absolute performance (%)
*
60.1
* Absolute performance (in sterling terms) has been calculated on a total return basis over the period 1 October 2024 to 30 September 2025. For the
definition of total return see Glossary of terms and alternative performance measures on pages 116 to 118.
19
Baillie Gifford European Growth Trust plc
Topicus.com
A serial acquirer in the vertical
market software space, buying
niche software companies in
the highly fragmented European
market. Internal cash generation
is strong thanks to the mission
critical nature of the software and
customer stickiness, which leads
to pricing power. This and the
presence of parent company and
major shareholder Constellation
Software – from which Topicus.com
was spun out in early 2021 –
increase the odds of smart capital
allocation and value creation for
many years to come.
ASML
Makes lithography machines
vital for the manufacture of
semiconductor chips. It is a crucial
enabler of Moore’s Law and has
an especially strong lead in the
most technologically advanced
extreme ultraviolet lithography
machines where it enjoys monopoly
status. Demand for smaller and
more computationally powerful
chips continues to grow strongly
with multiple drivers ranging from
artificial intelligence to internet of
things applications. This will require
more capital expenditure from
semiconductor fabs, resulting in a
highly favourable growth outlook.
Adyen
Adyen is a global payments
processing business, founded and
listed in the Netherlands. It solves
complexity in the payments stack,
allowing merchants to accept online
and in-person payments faster
and cheaper. It has grown rapidly
in recent years, securing business
from major customers like Shopify
and McDonald’s. We expect that
growth to continue for many years
to come given that it has barely
penetrated its addressable market.
© (ASML) All Rights Reserved
Geography Netherlands
Valuation at 30 September
2025 (£’000s)
17,016
% of net assets at
30September 2025
4.8
Valuation at 30 September
2024 (£’000s)
21,090
% of net assets at
30September 2024
5.8
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
(8,137)
Absolute performance (%)
*
13.7
Geography Netherlands
Valuation at 30 September
2025 (£’000s)
16,826
% of net assets at
30September 2025
4.8
Valuation at 30 September
2024 (£’000s)
15,666
% of net assets at
30September 2024
4.3
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
(966)
Absolute performance (%)
*
1 7. 7
Geography Netherlands
Valuation at 30 September
2025 (£’000s)
14,688
% of net assets at
30September 2025
4.2
Valuation at 30 September
2024 (£’000s)
15,294
% of net assets at
30September 2024
4.2
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
(930)
Absolute performance (%)
*
2.0
* Absolute performance (in sterling terms) has been calculated on a total return basis over the period 1 October 2024 to 30 September 2025. For the
definition of total return see Glossary of terms and alternative performance measures on pages 116 to 118.
Strategic report
Annual Report and Financial Statements 2025
20
Allegro.eu
Poland’s dominant ecommerce
platform. Online penetration of retail
remains relatively low in Poland, and
we believe Allegro will gain significant
share as it continues to broaden its
assortment and offers the best prices
on the market. It recently acquired Mall
Group, adding countries like Czechia
and almost doubling its addressable
market. Allegro’s position is driven
by powerful network effects, and its
ability to fight off competition has
been well-demonstrated, even against
almighty Amazon.
EQT
A Sweden-based but global private
equity firm. Asset allocators are
dedicating increasing portions of
their portfolios to private assets.
EQT is in a strong position to capture
a large share of these flows given
its global platform and impressive
investment track record. Meanwhile,
the company is seen as a ‘good
owner’, improving the firms it acquires
and is therefore more likely to appear
as an acquirer ofchoice.
Vend Marketplaces
A collection of online classifieds
marketplaces in the Nordics.
Powerful network effects have led
to its marketplaces, covering jobs,
real estate, used cars and more,
becoming dominant and hard to
displace. This dominance should
enable Vend Marketplaces to
capture an increasing proportion of
the transactions being made on its
platforms, leading to growth from
both pricing and volumes over the
long-term.
© Allegro
Geography Poland
Valuation at 30 September
2025 (£’000s)
13,263
% of net assets at
30September 2025
3.7
Valuation at 30 September
2024 (£’000s)
13,478
% of net assets at
30September 2024
3.7
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
(1,271)
Absolute performance (%)
*
7.7
Geography Sweden
Valuation at 30 September
2025 (£’000s)
12,986
% of net assets at
30September 2025
3.7
Valuation at 30 September
2024 (£’000s)
9,748
% of net assets at
30September 2024
2.7
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
3,119
Absolute performance (%)
*
1.9
Geography Norway
Valuation at 30 September
2025 (£'000s)
12,335
% of net assets at
30September 2025
3.5
Valuation at 30 September
2024 (£'000s)
17,971
% of net assets at
30September 2024
4.9
Net purchases/(sales) in
year to 30 September 2025
(£'000s)
(6,272)
Absolute performance ('%)* 12.1
* Absolute performance (in sterling terms) has been calculated on a total return basis over the period 1 October 2024 to 30 September 2025. For the
definition of total return see Glossary of terms and alternative performance measures on pages 116 to 118.
21
Baillie Gifford European Growth Trust plc
Roche Holding
Roche is a Swiss biopharmaceutical
company. It is emerging from a period
of pipeline setbacks with a refocused
and reinvigorated drug portfolio.
While consensus expectations are
low, the company’s deep early-
stage pipeline, which is the second
largest in the industry with 36novel
molecular entities, offers significant
unappreciated upside. Flagship
opportunities include Trontinemab,
Roche’s next-generation Alzheimer’s
therapy that leverages its proprietary
BrainShuttle
TM
technology to cross the
blood-brain barrier more effectively
than peers. If successful, this drug
could capture meaningful share in
what may become a $10–20bn+
global market. Complementing
its pharmaceutical strength is a
diagnostics division with global
scale and a potentially pivotal role in
Alzheimer’s disease diagnosis and
patient triage, anunderappreciated
ecosystem advantage.
Reply
Reply is an IT consultancy, well
positioned to capture long-term
digital transformation trends,
including cloud, IoT, and now,
GenAI. Its decentralised model
comprises 200+ autonomous
subsidiaries organised by domain
or technology (e.g., AWS, Azure),
enabling agility and technological
edge. These units operate with
real-time P&Ls and are incentivised
for profitability, fostering
entrepreneurial innovation. Domain-
specific expertise in GenAI is giving
Reply a first-mover edge, evident
in projects with Microsoft (Copilot),
Stellantis, and Volkswagen. Reply is
family-owned and operated with the
Rizzante family deeply embedded in
a technology-centric culture which
prizes innovation should keep it
durably successful.
Geography Switzerland
Valuation at 30 September
2025 (£’000s)
12,333
% of net assets at
30September 2025
3.5
Valuation at 30 September
2024 (£’000s)
–
% of net assets at
30September 2024
–
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
11,990
Absolute performance (%)
*
2.5
Geography Italy
Valuation at 30 September
2025 (£’000s)
12,072
% of net assets at
30September 2025
3.4
Valuation at 30 September
2024 (£’000s)
12,019
% of net assets at
30September 2024
3.3
Net purchases/(sales) in
year to 30 September 2025
(£’000s)
955
Absolute performance (%)
*
(5.4)
* Absolute performance (in sterling terms) has been calculated on a total return basis over the period 1 October 2024 to 30 September 2025. For the
definition of total return see Glossary of terms and alternative performance measures on pages 116 to 118.
Strategic report
Annual Report and Financial Statements 2025
22
One year
summary
The following information
illustrates how Baillie Gifford
European Growth Trust has
performed over the year to
30September 2025.
* Alternative performance measure – see Glossary of terms and alternative performance measures on pages 116 to 118.
†
Key Performance Indicator.
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 114.
Past performance is not a guide to future performance.
30 September
2025
30 September
2024 % change
Shareholders’ funds
(borrowings at book value)
£353.9m £366.4m
Net gearing* 14% 13%
Net asset value per ordinary share
(borrowings at book value)
109.0p 104.2p 4.6%
Net asset value per ordinary share
(borrowings at fair value)*
113.3p 108.0p 4.9%
Share price 103.5p 91.0p 13.7%
FTSE Europe ex UK Index
(in sterling terms)
12.0%
Ongoing charges*
†
0.66% 0.65%
Discount
(with borrowings at book value)*
5.0% 12.7%
Discount
(with borrowings at fair value)*
†
8.6% 15.7%
Revenue earnings per ordinary share 0.78p 0.72p 8.3%
Active share* 86% 88%
Dividends paid and payable in respect
of the year
0.72p 0.60p 20.0%
23
Baillie Gifford European Growth Trust plc
* Alternative performance measure – see Glossary of terms and alternative performance measures on pages 116 to 118.
†
Key performance indicator.
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 114.
Past performance is not a guide to future performance.
Year to 30 September 2025 2024
Total return (%)*
Net asset value per ordinary share
(borrowings at book value)
5.2% 14.5%
Net asset value per ordinary share
(borrowings at fair value)
†
5.5% 12.1%
Share price
†
14.5% 9.3%
FTSE Europe ex UK Index
(in sterling terms)
15.5% 15.3%
Year to 30 September 2025 2025 2024 2024
Year’s high and low High Low High Low
Net asset value
per ordinary share
(borrowings at
bookvalue)
112.97p 87.71p 114.70p 83.24p
Net asset value
per ordinary share
(borrowings at
fairvalue)*
117.19p 92.00p 118.28p 88.82p
Share price 108.00p 83.20p 101.00p 75.40p
Discount
(borrowings at
fairvalue)*
†
(6.5%) ( 1 7. 2%) (10.8%) (15.8%)
Year to 30 September 2025 2024
Net return per ordinary share
Revenue return 0.78p 0.72p
Capital return 4.03p 12.35p
Total return 4.81p 13.07p
Strategic report
Annual Report and Financial Statements 2025
24
(Discount)/premium* to NAV
(figures plotted on a monthly basis)
20252020 2021 2022 2023 2024
Years to 30 September
● (Discount)/premium
Source: LSEG/Baillie Gifford.
The (discount)/premium is the difference between Baillie Gifford European
Growth Trust's quoted share price and its underlying net asset value per
share expressed as a percentage of net asset value per share.
(20%)
(15%)
10%
5%
0%
(10%)
(5%)
* See Glossary of terms and alternative performance measures on pages 116 to 118.
†
With borrowings deducted at fair value.
#
The benchmark is the FTSE Europe ex UK Index (in sterling terms).
‡
See disclaimer on page 114.
Past performance is not a guide to future performance.
Five year total return* performance
(figures rebased to 100 at 30 September 2020, figures plotted
on a monthly basis)
20252020 2021 2022 2023 2024
Cumulative to 30 September
● NAV
†
● Share price ● Benchmark#
Source: LSEG/Baillie Gifford and relevant underlying index providers
‡
.
Dividends are reinvested.
50
250
200
150
100
Five year
summary
The following charts indicate
how an investment in
BaillieGifford European
GrowthTrust has performed
relative to its benchmark
andits underlying NAV
overthefive year period
to30September 2025.
25
Baillie Gifford European Growth Trust plc
20252021 2022 2023 2024
Years to 30 September
● NAV return
†
● Share price return
Source: LSEG/Baillie Gifford and relevant underlying index providers
‡
.
(40%)
(30%)
10%
0%
(10%)
(20%)
* See Glossary of terms and alternative performance measures on pages 116 to 118.
†
With borrowings deducted at fair value.
#
The benchmark is the FTSE Europe ex UK Index (in sterling terms).
‡
See disclaimer on page 114.
Past performance is not a guide to future performance.
Annual NAV and share price total returns*
(relative to the benchmark
#
total returns)
Annual NAV and share price total returns*
2025
2021
2022 2023 2024
Years to 30 September
● NAV return
†
● Share price return
Source: LSEG/Baillie Gifford and relevant underlying index providers
‡
.
(60%)
40%
20%
0%
(40%)
(20%)
● Benchmark#
Strategic report
Annual Report and Financial Statements 2025
26
Ten year
record
Source: LSEG/Baillie Gifford. See disclaimer on page 114.
* For a definition of terms see Glossary of terms and alternative performance measures on pages 116 to 118.
†
Alternative performance measure
#
Total operating costs divided by average net asset value. Baillie Gifford & Co Limited was appointed on 29 November 2019 and agreed to waive
its management fee for six months from the date of its appointment. Without the management fee waiver the ongoing charges ratio for the year to
30September 2020 would have been 0.66%. See Glossary of terms and alternative performance measures on pages 116 to 118.
‡
FTSE Europe ex UK Index (in sterling terms).
¶
Prior year figures restated for the ten for one share split on 1 February 2021.
Past performance is not a guide to future performance.
At 30 September 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015
Capital
Total assets (£’000) 406,207 416,275 379,350 362,957 613,010 469,587 373,857 426,974 440,200 360,875 312,239
Borrowings (£’000) 52,291 49,844 51,960 52,560 51,471 16,939 – 12,655 – 10,216 –
Shareholders’ funds (£’000) 353,916 366,431 327,390 310,397 561,539 452,648 373,857 414,319 440,200 350,659 312,239
NAV per share (book) (p)*
¶
109.0 104.2 91.4 86.5 154.0 125.0 92.9 100.4 104.8 83.4 74.2
NAV per share (fair) (p)*
†
113.3 108.0 96.7 91.9 154.5 125.0 92.9 100.4 104.8 83.4 74.2
Share price (p)
¶
103.5 91.0 83.6 79.5 152.4 122.0 81.0 90.8 92.0 72.3 6 7. 3
Discount (book) (%)*
†
5.0 12.7 8.5 8.1 1.0 2.4 12.8 9.6 12.3 13.3 9.3
Discount (fair) (%) 8.6 15.7 13.6 13.5 1.3 2.4 12.8 9.6 12.3 13.4 9.3
Revenue
Gross revenue (£’000) 4,063 4,013 3,912 4,313 3,256 2,597 14,523 13,775 12,591 10,357 9,540
Available for ordinary
shareholders (£’000)
2,662 2,547 9,625 2,861 1,533 1,569 12,605 11,461 10,853 8,003 6,708
Revenue earnings per
ordinary share (p)
¶
0.8 0.7 2.7 0.8 0.4 0.4 3.1 2.7 2.6 1.9 1.6
Ordinary dividends paid
and proposed per share
¶
0.72 0.6 0.4 0.7 0.3 0.3 3.1 2.7 2.1 1.6 1.4
Special dividends
per share (p)
¶
– – 2.2 – – – – – 0.1 0.6 0.2
Ongoing charges
ratio (%)
#†
0.7 0.6 0.6 0.6 0.7 0.4 0.6 0.6 0.6 0.6 0.6
Gearing
Net gearing (%)*
†
14.0 13.6 16.0 16.0 7. 0 4.0 0.0 3.0 – 3.0 –
Gross gearing (%)*
†
14.8 14.1 16.0 17. 0 9.0 4.0 0.0 3.0 – 3.0 –
Performance Total Returns
NAV (borrowings at fair
value) % change*
†
5.5 12.1 8.3 (40.4) 24.0 3 7. 5 (4.6) (2.1) 29.9 14.9 (5.5)
Share price % change*
†
14.5 9.3 8.6 (47.7) 25.2 54.2 (7.6) 1.2 32.2 9.8 (8.3)
Benchmark % change*
†
15.5 15.3 20.5 (15.3) 23.0 (0.3) 6.9 2.4 22.6 21.8 (1.8)
27
Baillie Gifford European Growth Trust plc
Source: LSEG and underlying data providers. See disclaimer on page 114.
* See Glossary of terms and alternative performance measures on pages 116 to 118.
†
FTSE Europe ex UK Index (in sterling terms).
Past performance is not a guide to future performance.
Cumulative performance (taking 2015 as 100)
At 30
September
Net asset
value per
share
Net asset
value total
return*
Share
price
Share price
total return* Benchmark
†
Benchmark
total return
†
Revenue
earnings
per ordinary
share
Dividends paid
and proposed
per ordinary
share
2015 100 100 100 100 100 100 100 100
2016 112 115 107 110 118 122 119 114
2017 141 149 137 145 140 149 161 150
2018 135 146 135 147 139 153 171 193
2019 125 139 120 136 143 163 194 221
2020 168 192 181 209 139 163 26 21
2021 207 238 226 262 167 200 26 21
2022 117 142 118 137 137 170 49 50
2023 123 153 124 149 161 204 168 29
2024 140 172 135 163 180 236 45 43
2025 147 181 154 186 201 272 49 51
Compound annual returns (%)
5 year (2.7) (1.1) (3.2) (2.3) 7. 6 10.8 13.3 19.1
10 year 3.9 6.1 4.4 6.4 7. 2 10.5 (6.9) (6.4)
Cumulative to 30 September
2025
2015 2017 2020 2022 20242016 20192018 2021 2023
● Share price total return
*
● NAV total return
*
● Benchmark total return
*†
0
350
300
150
100
50
250
200
Ten year total return performance
*
Strategic report
Annual Report and Financial Statements 2025
28
Business model
Business and status
Baillie Gifford European Growth Trust plc (‘the
Company’) is a public company limited by shares
and is incorporated in England. The Company is an
investment company within the meaning of section
833 of the Companies Act 2006 and carries on
business as an investment trust. Investment trusts
are UK public listed companies and their shares
are traded on the London Stock Exchange. They
invest in a portfolio of assets in order to spread risk.
The Company has a fixed share capital although,
subject to shareholder approval sought annually, it
may purchase its own shares or issue shares. The
price of the Company’s shares is determined, like
other listed shares, by supply and demand. The
Company has been approved as an investment trust
by HMRevenue & Customs subject to the Company
continuing to meet the eligibility conditions. The
Directors are of the opinion that the Company has
continued to conduct its affairs so as to enable
it to comply with the ongoing requirements of
section 1158 of the Corporation Tax Act 2010 and
the Investment Trust (Approved Company) (Tax)
Regulations 2011.
The Company is an Alternative Investment Fund
(‘AIF’) for the purposes of the UK Alternative
Investment Fund Managers Regulations.
Investment objective
To achieve capital growth over the long-term from
adiversified portfolio of European securities.
Investment policy
The Company is invested in a diversified portfolio
ofbetween 30 to 60 European companies.
The Company may not invest more than 10% of
totalassets in any one individual stock at the time
ofinvestment.
The Board recognises that investment in some
European countries can be riskier than in others.
Investment risks are diversified through holding a
wide range of securities in different countries and
industrial sectors. The Company has the ability to
invest in securities that are listed in countries which
are not included in the FTSE All-World European
ex UK indices, where these securities have a
meaningful connection with continental Europe.
The Board has the authority to hedge the Company’s
exposure to movements in the rate of exchange
of currencies, principally the euro, in which the
Company’s investments are denominated, against
sterling, its reporting currency.
Up to 20% of total assets, as measured at the time
of initial investment, can be invested in unlisted
investments.
Business
review
29
Baillie Gifford European Growth Trust plc
The level of gearing within the portfolio is agreed by
the Board and the absolute amount of any gearing
should not exceed 20% of net assets at time of
drawdown, excluding any unlisted investments inthe
calculation of net assets.
No more than 10% of the total assets of the
Company may be invested in other listed investment
companies (including investment trusts) except
in those that have stated that they will invest no
more than 15% of their total assets in other listed
investment companies. In this case, the limit is 15%.
The Managers’ compliance with the limits set out in
the investment policy is monitored by the Board and
the Alternative Investment Fund Manager (‘AIFM’).
Culture
As an externally managed investment company
with no employees, Baillie Gifford European Growth
Trust’s culture is expressed through its Board and
its third party service providers, in particular its
Managers, in their interactions with shareholders
and other stakeholders. The Board’s assessment of
its own interactions is described in its Section 172
Statement on pages 37 to 39, and the Baillie Gifford
statement on stewardship, which describes the
Managers’ culture of constructive engagement, is set
out on page 41.
Borrowings
At 30 September 2025 the Company had an
uncommitted €30 million bank overdraft credit
facility agreement with The Northern Trust Company
for the purpose of pursuing its investment objective.
At 30 September 2025, nil had been drawn down
(2024 – nil). At 30 September 2025 the Company
also had €30 million of long-term, fixed rate, senior,
unsecured privately placed loan notes, with a fixed
coupon of 1.57% to be repaid on 8 December 2040
and a further €30 million of long-term, fixed rate,
senior, unsecured privately placed loan notes with
a fixed coupon of 1.55% to be repaid on 24 June
2036. Further details of the Company’s borrowings
are set out in note 12 on page 93.
Strategic report
Annual Report and Financial Statements 2025
30
Performance
At each Board meeting, the Directors consider a number of performance measures to assess the Company’s
success in achieving its objectives. The performance measures below are to 30 September 2025.
* Alternative performance measure – see Glossary of terms and alternative performance measures on pages 116 to 118. Baillie Gifford & Co was
appointed on 29 November 2019.
Past performance is not a guide to future performance.
Key performance indicators
The Board uses key performance
indicators (‘KPIs’) to measure
the progress and performance
of the Company over time when
discharging its duties as set
out on page 59. These KPIs are
established industry measures.
The one, five and ten year records
of the KPIs can be found on
pages22 to 27. Further discussion
is included in the Chairman’s
statement on pages 07 to 10.
In addition to the above, the Board
considers peer group comparative
performance.
Across these measures, the Board
looks for relative outperformance
over the long term, while
remaining mindful that the nature
of the Investment Policy and the
growth characteristics of the
portfolio investments may entail
periods of underperformance over
the short and medium term.
Share price total return
relativeto the benchmark
*
The total return is the return to
shareholders after reinvesting the
netdividend on the date that the
share price goes ex-dividend.
-100
-80
-60
-40
-20
0
● Share price total return
1 year 5 years 10 yea
rs
3 years
-100
-80
-60
-40
-20
0
● NAV total return
1 year 5 years 10 years
3 years
Net asset value total return
relative to the benchmark
*
The total return is the return to
shareholders after reinvesting the
netdividend on the date that the
share price goes ex-dividend.
Share price
(discount)/premium
*
As stock markets and share prices
vary, an investment trust’s share price
is rarely the same as its NAV. When the
share price is lower than the NAV it is
said to be trading at a discount. If the
share price is higher than the NAV, this
situation is called a premium.
-15
-10
-5
0
● Average (discount)/premium
of NAV to share price
1 year 5 years 10 years
%
3 years
Ongoing charges ratio
*
The ongoing charges ratio is the
total recurring expenses (excluding
the Company’s cost of dealing in
investments and borrowing costs)
incurred by the Company as a
percentage of the daily average net
asset value. Without the management
fee waiver (see page 26) theongoing
charges ratio for 2020 would have
been 0.66%.
0.0
0.2
0.4
0.6
0.8
● Ongoing charges ratio
%
2015 2025
31
Baillie Gifford European Growth Trust plc
Viability statement
Having regard to provision 31 of the UK Corporate
Governance Code, the Directors have assessed the
prospects of the Company over a five year period.
The Directors continue to believe this period to be
appropriate as it reflects the Company’s longer
term investment strategy and to be a period during
which, in the absence of any adverse change to the
regulatory environment and to the tax treatment
afforded to UK investment trusts, they do not expect
there to be any significant change to the current
principal risks facing the Company nor to the
effectiveness of the controls employed to mitigate
those risks. Notwithstanding the performance-
related tender offer over the four years to
30September 2028 the Directors do not reasonably
envisage any change in strategy or any events which
would prevent the Company from operating over a
period of five years.
In considering the viability of the Company, the
Directors have conducted a robust assessment
of each of the principal and emerging risks
and uncertainties detailed on pages 32 to 36,
inparticular the impact of market risk where a
significant fall in European equity markets would
adversely impact the value of the investment
portfolio. The Directors have also considered the
Company’s leverage and liquidity in the context of
the loan notes repayable in 2036 and 2040, the
income and expenditure projections and the fact that
the majority (86%) of the Company’s investments
are readily realisable quoted equity securities which
can be sold to meet its liabilities if necessary, the
main liabilities currently being the loan notes.
Specific leverage and liquidity stress testing was
conducted during the year, including consideration
of the risk of further market volatility resulting from
increasing geopolitical tensions. The leverage stress
testing identified the impact on leverage in scenarios
where gross assets fall by 25% and 50%, reflecting
a range of market conditions that may adversely
impact the portfolio. The liquidity stress testing
identified the reduction in the value of assets that
can be liquidated within one month that would result
in the value of those assets falling below the value
of the borrowings. The stress testing did not indicate
any matters of concern.
In addition, all of the key operations required by
the Company are outsourced to third party service
providers and it is reasonably considered that
alternative providers could be engaged at relatively
short notice where necessary.
Based on the Company’s processes for monitoring
revenue projections and operating costs, share
price discount/premium, the Managers’ compliance
with the investment objective, asset allocation,
the portfolio risk profile, leverage, counterparty
exposure, liquidity risk, financial controls and the
Managers’ operational resilience, the Directors have
concluded that there is a reasonable expectation
that the Company will be able to continue in
operation and meet its liabilities as they fall due over
the next five years.
Strategic report
Annual Report and Financial Statements 2025
32
Principal and emerging risks
As explained on pages 62 and 63 there is an ongoing process for identifying, evaluating and managing
the risks faced by the Company. The Directors have undertaken a robust assessment of the principal
and emerging risks facing the Company, including those that would threaten the business model, future
performance, solvency or liquidity. A description of these risks and how they are being managed or
mitigated is set out below:
Investment
strategy risk
What is the risk?
Pursuit of an investment
strategy to fulfil the Company’s
objective which the market
perceives to be unattractive or
inappropriate, or the ineffective
implementation of an attractive
or appropriate strategy, may
lead to reduced returns for
shareholders and, as a result,
adecreased demand for the
Company’s shares. This may
lead to the Company’s shares
trading at a widening discount
to their net asset value.
How is it managed?
To mitigate this risk, the Board
regularly reviews and monitors
the Company’s objective and
investment policy and strategy,
the investment portfolio and
its performance, the level of
discount/premium to net asset
value at which the shares trade
and movements in the share
register and raises any matters
ofconcern with the Managers.
Rating and
change
Current assessment of risk
This risk is considered to
have increased. The market
appetite for growth investing
is considered to have
deteriorated. However, the
discount has reduced from
15.7% to 8.6% during the
year as the Company bought
back 27,060,412 shares.
Cyber
security risk
What is the risk?
A cyber attack on Baillie Gifford’s
network or that of a third party
service provider could impact
the confidentiality, integrity or
availability of data and systems.
Emerging technologies,
including AI and quantum
computing capabilities, may
introduce new, and increase
existing information security
risks that impact operations.
How is it managed?
To mitigate this risk, the Audit
Committee reviews Reports
on Internal Controls published
by Baillie Gifford and other
third party service providers.
Cyber security due diligence
is performed by Baillie Gifford
on third party service providers
which includes a review of crisis
management and business
continuity frameworks.
Rating and
change
Current assessment of risk
This risk is seen as increasing
due to the continuation
of geopolitical tensions
that could lead to more
cyber attacks. Emerging
technologies, including AI,
could potentially increase
information security risks. In
addition, service providers
operate a hybrid approach of
remote and office working,
thereby increasing the
potential of acyber security
threat.
Political and
associated
economic risk
What is the risk?
Political change in areas in
which the Company invests or
may invest may have financial
consequences for the Company.
How is it managed?
To mitigate this risk, developments
are closely monitored and
considered by the Board and
areregularly discussed at
Boardmeetings.
Rating and
change
Current assessment of risk
The prospect of market
volatility remains, given
continuing geopolitical
instability.
Decreasing RiskIncreasing Risk Stable Risk
Moderate RiskHigh Risk Low Risk
33
Baillie Gifford European Growth Trust plc
Financial
risk
What is the risk?
The Company’s assets consist
mainly of listed securities
(86.4%of the investment
portfolio) and its principal and
emerging financial risks are
therefore market related and
include market risk (comprising
currency risk, interest rate
risk and other price risk),
liquidity risk and credit risk.
An explanation of those risks
and how they are managed
is contained in note 19 to
the Financial Statements on
pages95 to 101.
How is it managed?
The Board has, in particular,
considered the impact of
heightened market volatility due
to macroeconomic factors such
as higher inflation and interest
rates and geopolitical concerns.
In order to oversee this risk, the
Board considers at each meeting
various metrics including regional
and industrial sector weightings,
top and bottom stock contributors
to performance along with sales
and purchases of investments.
Individual investments are
discussed with the portfolio
manager together with general
views on the investment markets
and sectors. A strategy session is
held annually.
Rating and
change
Current assessment of risk
The prospect of market
volatility remains, given
continuing geopolitical
instability.
Private
company
investment
risk
What is the risk?
The Company’s liquidity risk
could be increased by its
investment in private company
securities. These assets may
be more difficult to buy or
sell, so changes in their prices
may be greater than for listed
investments and their valuations
may be perceived to be more
volatile or out of date.
How is it managed?
To mitigate this risk, the Board
considers the private company
securities in the context of the
overall investment strategy and
provides guidance to the Managers
on the maximum exposure to
private company securities.
The investment policy limits the
amount which may be invested
in private company securities to
20% of the total assets of the
Company, measured at the time of
investment. The Managers have
a robust valuation methodology,
which is applied consistently.
In periods of market volatility,
the Managers’ Private Company
Valuations Group will perform
trigger analyses initial and, if
appropriate, revalue the relevant
investments. The valuations are
subject to review and challenge by
the Board every six months and
are subject to scrutiny annually by
the external Auditor.
Rating and
change
Current assessment of risk
One new private company
was purchased during the
period. At 30 September
2025, private company
investments comprised
13.5% of total assets.
Decreasing RiskIncreasing Risk Stable Risk
Moderate RiskHigh Risk Low Risk
Strategic report
Annual Report and Financial Statements 2025
34
Climate and
governance
risk
What is the risk?
Perceived problems on
environmental, social and
governance (‘ESG’) matters
in an investee company
could lead to that company’s
shares being less attractive to
investors, adversely affecting
its share price, in addition
to potential valuation issues
arising from any direct impact of
the failure to address the ESG
weakness on the operations or
management of the investee
company (for example in the
event of an industrial accident
or spillage). Repeated failure
by the Managers to identify
ESG weaknesses in investee
companies could lead to the
Company’s own shares being
less attractive to investors,
adversely affecting its own
share price.
How is it managed?
This is mitigated by the Managers’
strong ESG stewardship and
engagement policies which are
available to view on the Managers’
website, bailliegifford.com/esg,
and which have been reviewed and
endorsed by the Company, and
which have been fully integrated
into the investment process. Due
diligence includes assessment
of the risks inherent in climate
change (see page 64).
Rating and
change
Current assessment of risk
The Investment Manager
continues to employ strong
ESG stewardship and
engagement policies.
Discount
risk
What is the risk?
The discount/premium at
which the Company’s shares
trade relative to its net asset
value can change. The risk of a
widening discount is that it may
undermine investor confidence
in the Company.
How is it managed?
To manage this risk, the
Boardmonitors the level of
discount/premium at which the
shares trade and the Company
has authority to buy back its
existing shares, when deemed
by the Board to be in the best
interests of the Company and
itsshareholders.
Rating and
change
Current assessment of risk
The Company’s shares traded
at an average discount of
11.7% throughout the year
and the discount at the year
end was 8.6%. The Company
bought back 27,060,412
ordinary shares during
theyear. The Board has also
put in place a performance-
related tender offer as set out
on page 7.
Decreasing RiskIncreasing Risk Stable Risk
Moderate RiskHigh Risk Low Risk
35
Baillie Gifford European Growth Trust plc
Custody and
depositary
risk
What is the risk?
Safe custody of the Company’s
assets may be compromised
through control failures by the
Depositary, including breaches
of cyber security.
How is it managed?
To mitigate this risk, the Audit
Committee receives six-monthly
reports from the Depositary
confirming safe custody of the
Company’s assets held by the
Custodian. Cash and portfolio
holdings are independently
reconciled to the Custodian’s
records by the Managers who also
agree uncertificated private
portfolio holdings to confirmations
from investee companies. The
Custodian’s audited internal
controls reports are reviewed by
Baillie Gifford’s Business Risk
Department and a summary of the
key points is reported to the Audit
Committee and any concerns
investigated. In addition, the
existence of assets is subject to
annual external audit.
Rating and
change
Current assessment of risk
All control procedures are
working effectively.
Operational
risk
What is the risk?
Failure of Baillie Gifford’s
systems or those of other
third party service providers
could lead to an inability to
provide accurate reporting
and monitoring or a
misappropriation of assets.
How is it managed?
To mitigate this risk, Baillie Gifford
has a comprehensive business
continuity plan which facilitates
continued operation of the
business in the event of a service
disruption. The Audit Committee
reviews Baillie Gifford’s Report
on Internal Controls and reports
by other key third party providers
are reviewed by Baillie Gifford
on behalf of the Board and a
summary of the key points is
reported to the Audit Committee
and any concerns investigated.
The other key third party service
providers have not experienced
significant operational difficulties
affecting their respective services
to the Company.
Rating and
change
Current assessment of risk
All control procedures are
working effectively.
Decreasing RiskIncreasing Risk Stable Risk
Moderate RiskHigh Risk Low Risk
Strategic report
Annual Report and Financial Statements 2025
36
Leverage risk
What is the risk?
The Company may borrow
money for investment purposes
(sometimes known as ‘gearing’
or ‘leverage’). If the investments
fall in value, any borrowings
will magnify the extent of this
loss. If borrowing facilities are
not renewed, the Company
may have to sell investments
torepay borrowings.
How is it managed?
To mitigate this risk, all borrowings
require the prior approval of
the Board and leverage levels
are discussed by the Board and
Managers at every meeting.
Covenant levels are monitored
regularly. The majority of the
Company’s investments are in
quoted securities that are readily
realisable. Further information
on leverage can be found on
page113 and the Glossary of
terms and alternative performance
measures on pages 116 to 118.
Rating and
change
Current assessment of risk
The Company has in place
long term borrowings,
expiring in 2036 and 2040.
Regulatory
risk
What is the risk?
Failure to comply with
applicable legal and regulatory
requirements such as the
tax rules for investment trust
companies, the UK Listing
Rules and the Companies Act
could lead to suspension of the
Company’s Stock Exchange
listing, financial penalties, a
qualified audit report or the
Company being subject to tax
on capital gains. Changes to the
regulatory environment could
negatively impact the Company.
How is it managed?
To mitigate this risk,
BaillieGifford’s Business Risk,
Internal Audit and Compliance
Departments provide regular
reports to the Audit Committee
on Baillie Gifford’s monitoring
programmes. Major regulatory
change could impose
disproportionate compliance
burdens on the Company. In such
circumstances representation is
made to ensure that the special
circumstances of investment
trusts are recognised. Shareholder
documents and announcements,
including the Company’s
published Interim and Annual
Report and Financial Statements,
are subject to stringent review
processes and procedures are
in place to ensure adherence to
the Transparency Directive and
the Market Abuse Directive with
reference to inside information.
Rating and
change
Current assessment of risk
All control procedures are
working effectively. There
have been no material
regulatory changes that
have impacted the Company
during the year.
Emerging risks
As explained on pages 62 and 63, the Board has regular discussions on principal and emerging risks, including any risks which are not
an immediate threat but could arise in the longer term. The Board considers emerging risks at each Board meeting and discusses any
mitigations required.
Decreasing RiskIncreasing Risk Stable Risk
Moderate RiskHigh Risk Low Risk
37
Baillie Gifford European Growth Trust plc
Promoting the success of the Company
(section 172 statement)
Under section 172 of the Companies Act 2006,
the directors of a company must act in the way
they consider, in good faith, would be most likely
to promote the success of the company for the
benefit of its members as a whole, and in doing
so have regard (amongst other matters and to the
extent applicable) to: a) the likely consequences
of any decision in the long term, b) the interests
of the company’s employees, c) the need to
foster the company’s business relationships with
suppliers, customers and others, d) the impact of
the company’s operations on the community and
the environment, e) the desirability of the company
maintaining a reputation for high standards of
business conduct, and f) the need to act fairly as
between members of the company.
In this context, having regard to the Company being
an externally-managed investment company with
no employees, the Board considers the Company’s
key stakeholders to be: its existing and potential new
shareholders; its externally-appointed Managers
and Secretaries (Baillie Gifford); other professional
service providers (corporate broker, registrar,
Auditors and depositary); lenders; wider society and
the environment.
The Board considers that the interests of the
Company’s key stakeholders are aligned, in terms
of wishing to see the Company deliver sustainable
long-term growth, in line with the Company’s
stated objective and strategy, and meet the highest
standards of legal, regulatory, and commercial
conduct, with the differences between stakeholders
being merely a matter of emphasis on those
elements.
The Board’s methods for assessing the Company’s
progress in the context of its stakeholders’ interests
are set out below.
Stakeholder Why we engage How we engage and what we do
Shareholder Shareholders are, collectively, the Company’s
owners: providing them with a return for their
investment in accordance with the Company’s
investment policy and objective is the reason
for its existence.
The Board places great importance on communication
with shareholders. The Annual General Meeting provides
an opportunity for the Board and Managers to present to
shareholders on the Company’s performance, future plans
and prospects. It also allows shareholders the opportunity to
meet with the Board and Managers and raise questions and
concerns. The Chairman and Senior Independent Director
(‘SID’) are available to meet with shareholders as appropriate.
The Managers meet regularly with shareholders and their
representatives, reporting their views back to the Board.
Directors also attend certain shareholder presentations, in
order to gauge shareholder sentiment first hand. Shareholders
may also communicate with members of the Board at any time
by writing to them at the Company’s registered office or to the
Company’s broker. These communication opportunities help
inform the Board when considering how best to promote the
success of the Company for the benefit of all shareholders
over the long term.
Baillie Gifford –
Managers and
Secretaries
The Company’s Board has delegated the
management of the Company’s portfolio,
and the administration of the Company’s
operations including fulfilment of regulatory
and taxation reporting requirements, to Baillie
Gifford. Baillie Gifford is therefore responsible
for the substantial activities of the Company
and has the most immediate influence on
its conduct towards the other stakeholders,
subject to the oversight and strategic direction
provided by the Board.
The Board seeks to engage with its Managers and
Secretaries, and other service providers, in a collaborative
and collegiate manner, encouraging open and constructive
discussion and debate, while also ensuring that appropriate
and regular challenge is brought and evaluation conducted.
This approach aims to enhance service levels and strengthen
relationships with the Company’s providers, with a view
to ensuring the interests of the Company’s shareholders
are best served by keeping cost levels proportionate and
competitive, and by maintaining the highest standards of
business conduct.
Strategic report
Annual Report and Financial Statements 2025
38
Stakeholder Why we engage How we engage and what we do
Portfolio companies As all of the Company’s operations are
conducted by third party professional
providers, it is the companies held in its
investment portfolio which have the primary
real-world impact in terms of social and
environmental change, both positively and
negatively, as well as generating, through their
commercial success, the investment growth
sought by the Company’s shareholders.
The investee companies have an interest in
understanding their shareholders’ investment
rationale in order to assure themselves
that long-term business strategies will be
supported.
The Board is cognisant of the need to consider the impact
of the Company’s investment strategy and policy on wider
society and the environment. The Board considers that its
oversight of environmental, social and governance (‘ESG’)
matters is an important part of its responsibility to all
stakeholders. The Board’s review of the Managers includes
an assessment of their ESG approach and its application in
making investment decisions. The Board regularly reviews
Governance Engagement reports, which document the
Managers’ interactions with investee companies on ESG
matters (see pages 42 to 44).
Brokers The Company’s brokers provide an interface
between the Company’s Board and its
institutional shareholders.
The Company’s brokers attend each Board meeting, and
present a report at those meetings, in order to keep the
Board apprised of shareholder and wider market sentiment
regarding the Company. They also arrange forums for
shareholders to meet the Chairman, or other Directors,
outwith the normal general meeting cycle.
Registrars The Company’s registrars provide an interface
with those shareholders who hold the
Company’s shares directly.
The Company Secretaries liaise with the registrars to
ensure the frequency and accuracy of communications
to shareholders is appropriate, and monitor shareholder
correspondence to ensure that the level of service provided
by the registrars is acceptable. The Manager’s risk function
reviews the registrars’ internal controls report and reports on
the outcome of this review to the Audit Committee.
Auditor The Company’s Auditor has a responsibility to
provide an opinion on whether the Company’s
Financial Statements as a whole are free from
material misstatement, as set out in more
detail in the Auditor’s Report to the members
on page 75.
The Company’s Auditor meets with the Audit Committee, in
the absence of the Managers where deemed necessary, and
the Managers undertake to provide all information requested
by the Auditor in connection with the Company’s annual audit
promptly and to ensure that it is complete and accurate in
allrespects.
Depositary
andCustodian
The Depositary is responsible for the
safekeeping of the Company’s financial
instruments, as set out in more detail on
page54.
The Depositary provides the Audit Committee with a report
on its monitoring activities. The Board and Managers seek to
engage with the Depositary and Custodian in a collaborative
and collegiate manner, encouraging open and constructive
discussion and debate, while also ensuring that appropriate
and regular challenge is brought and evaluation conducted.
This approach aims to enhance service levels and strengthen
relationships with the Company’s providers, with a view to
ensuring the interests of the Company’s shareholders are
best served by keeping cost levels proportionate and
competitive, and by maintaining the highest standards of
business conduct.
Lenders Lenders such as holders of debt instruments
(debentures, bonds and private placement
loan notes) and banks providing fixed or
revolving credit facilities or overdrafts provide
the Company’s gearing and have an interest
in the Company’s ongoing financial health
andviability.
The Company’s legal advisers review all legal agreements
in connection with the Company’s debt arrangements
and advise the Board on the appropriateness of the terms
and covenants therein. The Managers and Secretaries
ensure that the frequency and accuracy of reporting on,
for example, covenant certification, is appropriate and
that correspondence from the lenders receives a prompt
response.
39
Baillie Gifford European Growth Trust plc
Stakeholder Why we engage How we engage and what we do
AIC/industry peers The Association of Investment Companies
(AIC) and the Company’s investment trust
industry peers have an interest in the
Company’s conduct and performance,
asadverse market sentiment towards one
investment trust can affect attitudes towards
the wider industry.
The Company is a member of the AIC, and the Directors and/
or the Managers and Secretaries (as appropriate) participate
in technical reviews, requests for feedback on proposed
legislation or regulatory developments, corporate governance
discussions and/or training.
Investment
platforms
Investment platforms provide an interface
with shareholders who invest in the
Companyindirectly.
The Managers liaise with the various investment platforms on
strategies for improving communications with the Company’s
shareholders who hold their shares via these platforms. Up-
to-date information about the Company, including monthly
commentary, recent portfolio information, performance
figures and an annual timetable of key dates is published
on the Company’s website, for the ease of reference of
suchshareholders.
Wider society and
the environment
No entity, corporate or otherwise, can exist
without having an influence on the society in
which it operates or utilising the planet’s
resources. Through its third-party relationships,
as noted above, the Company seeks to be a
positive influence and, in circumstances
where that is not possible, to mitigate its
negative impacts insofar as is possible.
The Board and Managers’ interactions with the various
stakeholders as noted above form the principal forms of
direct engagement with wider society and in respect of the
environment (commercial, financial, and in terms of planetary
health and resources).
The Board recognises the importance of maintaining
the interests of the Company and its stakeholders,
in aggregate, firmly front of mind in its key decision
making and Baillie Gifford & Co Limited, the
Company Secretaries, are at all times available to
the Board to ensure that suitable consideration is
given to the range of factors to which the Directors
should have regard. In addition to ensuring that the
Company’s stated investment objective was being
pursued, key decisions and actions during the year
which have required the Directors to have regard to
applicable section 172 factors include:
• The Board’s decision to declare a final dividend
of 0.60p per ordinary share for the year end
30September 2024, the minimum required forthe
Company to maintain its investment trust status;
• The buy back of 27,060,412 shares at a discount
enhancing the NAV for continuing shareholders;
• As noted in the Audit Committee Report on
page65, two Audit Committees during the period
were devoted to a review of the valuation of the
Company’s private companies. In addition, the Board
provided challenge during the year to the Managers
regarding the rationale for the Company to hold
private companies, their approach to investing in
private companies and the valuation methodologies
applied;and
• The Board conducted meetings with shareholders
during the year to seek their feedback and
understand their views. During the year the
Company hosted an Annual General Meeting
providing shareholders with the opportunity to
engage directly with the Board and the Managers.
A Q&A session was held allowing shareholders to
raise questions and receive detailed responses.
The Board encourages shareholders to attend the
Annual General Meeting in February 2026 (see the
Notice of AGM on pages 103 to 108). The Board
continues to utilise digital platforms, including
the Company website to disseminate timely
information and updates. The Board remains
committed to maintaining regular, open and
transparent communication with all shareholders.
Strategic report
Annual Report and Financial Statements 2025
40
Employees, human rights
andcommunityissues
The Board recognises the requirement to provide
information about employees, human rights
and community issues. As the Company has no
employees, all its Directors are non-executive
and all its functions are outsourced, there are no
disclosures to be made in respect of employees,
human rights and community issues.
Gender representation
At 30 September 2025, the Board comprises four
Directors, two male and two female. The Company
has no employees. The Board’s policy on diversity is
set out on pages 61 and 62.
Environmental, social and governance policy
Details of the Company’s policy on socially
responsible investment can be found under
Corporate governance and stewardship on page 64.
The Company considers that it does not fall within
the scope of the Modern Slavery Act 2015 and it
is not, therefore, obliged to make a slavery and
human trafficking statement. In any event, the
Company considers its supply chains to be of
low risk as its suppliers are typically professional
advisers. Astatement by the Managers under the
Act has been published on the Managers’ website at
bailliegifford.com.
The Strategic report, which includes pages 07 to 48
was approved by the Board of Directors and signed
on its behalf on 8 December 2025.
David Barron
Chairman
41
Baillie Gifford European Growth Trust plc
Baillie Gifford statement
on stewardship
management. While assessing alignment with
management often comes down to intangible factors
and an understanding built over time, we look for
clear evidence of alignment in everything from
capital allocation decisions in moments of stress
to the details of executive remuneration plans and
committed share ownership. We expect companies
to deepen alignment with us, rather than weaken it,
where the opportunity presents itself.
Governance fit for purpose
Corporate governance is a combination of structures
and behaviours; a careful balance between
systems, processes and people. Good governance
is the essential foundation for long-term company
success. We firmly believe that there is no single
governance model that delivers the best long-term
outcomes. We therefore strive to push back against
one-dimensional global governance principles in
favour of a deep understanding of each company
we invest in. We look, very simply, for structures,
people and processes which we think can maximise
the likelihood of long-term success. We expect to
trust the boards and management teams of the
companies we select, but demand accountability
ifthat trust is broken.
Sustainable business practices
A company’s ability to grow and generate value for
our clients relies on a network of interdependencies
between the company and the economy, society
and environment in which it operates. We expect
holdings to consider how their actions impact and
rely on these relationships. We believe long-term
success depends on maintaining a social licence
to operate and look for holdings to work within
the spirit and not just the letter of the laws and
regulations that govern them. Material factors should
be addressed at the board level as appropriate.
Baillie Gifford’s overarching ethos is that we are
‘Actual’ investors. That means we seek to invest
for the long term. Our role as an engaged owner
is core to our mission to be effective stewards
for our clients. As an active manager, we invest in
companies at different stages of their evolution
across many industries and geographies, and focus
on their unique circumstances and opportunities. Our
approach favours a small number of simple principles
rather than overly prescriptive policies. This helps
shape our interactions with holdings and ensures our
investment teams have the freedom and retain the
responsibility to act in clients’ best interests.
Where possible we consider all asset classes within
the framework of our stewardship activities. We seek
to apply the most appropriate ownership tools to
each holding in delivering our objectives.
Long-term value creation
We believe that companies that are run for the
long-term are more likely to be better investments
over our clients’ time horizons. We encourage our
holdings to be ambitious, focusing on long-term
value creation and capital deployment for growth.
We know events will not always run according to
plan. In these instances we expect management
to act deliberately and to provide appropriate
transparency. We think helping management to
resist short-term demands from shareholders often
protects returns. We regard it as our responsibility to
encourage holdings away from destructive financial
engineering towards activities that create genuine
value over the long-run. Our value will often be in
supporting management when others don’t.
Alignment in vision and practice
Alignment is at the heart of our stewardship
approach. We seek the fair and equitable treatment
of all shareholders alongside the interests of
Strategic report
Annual Report and Financial Statements 2025
42
Corporate governance and stewardship
The Company has given discretionary voting powers
to Baillie Gifford & Co. The Managers vote against
resolutions they consider may damage shareholders’
rights or economic interests and report their actions
to the Board.
The Company believes that it is in the shareholders’
interests to consider environmental, social and
governance (‘ESG’) factors when selecting and
retaining investments and has asked the Managers
to take these issues into account as long as the
investment objectives are not compromised.
TheManagers do not exclude companies from
their investment universe purely on the grounds
of ESG factors but adopt a positive engagement
approach whereby matters are discussed with
Environmental, social and
governance engagement
management with the aim of improving the relevant
policies andmanagement systems and enabling
the Managers toconsider how ESG factors could
impact long-term investment returns. The Managers’
statement of compliance with the UK Stewardship
Code can be found on the Managers’ website:
bailliegifford.com. The Managers’ policy has been
reviewed and endorsed by the Board.
By engaging with companies, the Managers seek
to build constructive relationships with them, to
better inform our investment activities and, where
necessary, effect change within our holdings,
ultimately with the goal of achieving better returns
for our shareholders. The graph belowshows the
engagements in the year to 30September 2025.
The examples on the following pages demonstrate our stewardship approach through constructive
ongoingengagement.
Engagement Themes
0
10
20
30
40
Environmental Social Governance
Number of engagements
43
Baillie Gifford European Growth Trust plc
ASML Holding N.V.
Objective
We had an update from ASML’s sustainability team
on the company’s progress against its climate-
related targets and its engagement with the wider
semiconductor value chain. For context, ASML
has ambitious decarbonisation goals, significant
influence over the energy-intensive semiconductor
manufacturing process, and its customers depend
on ASML to reduce the energy and water intensity
oflithography.
Discussion
ASML has progressed from the awareness-
raising stage to the implementation phase of its
climate targets. Customer demand remains a core
driver – 85per cent of customers cite climate as
important–but there is also a strong internal conviction
that pursuing these targets is the right course of action.
ASML has no plans to alter its commitments, though it
acknowledges potential difficulty in meeting its 2025
operational goal of achieving carbon neutrality. On
Scope 3 emissions, the company’s engagement with
customers centres on education and collaboration, with
notable progress seen at TSMC. The Semiconductor
Climate Consortium, which convenes stakeholders
across the value chain, provides a valuable platform
for collaboration in this respect. At the same time,
ASML continues to enhance the energy efficiency of
its systems and integrates customer feedback directly
into design roadmaps. Renewable energy procurement
remains the most significant challenge, particularly for
customers in Korea andTaiwan.
Outcome
ASML remains a climate leader within the
semiconductor value chain and continues to advance
its targets. While challenges persist, the company’s
commitment remains firm. We will continue to monitor
its progress and any material developments across the
value chain.
© eqroy – stock.adobe.com
Moncler S.p.A.
Objective
To assess the underpinnings of Moncler’s programme
of supply chain excellence, an issue of reputational
significance with implications for brand integrity.
Investigations by Italian authorities in 2024 found
sweatshop-like conditions in the supply chains of the
luxury fashion brands Dior and Armani. Subsequent
reports described these issues as systemic rather than
sporadic in the sector, and the authorities are continuing
investigations into the supply chains of other luxury
brands, although the names remain undisclosed. We
spoke with Moncler’s chief marketing and corporate
strategy officer and sustainability director to understand
how it navigates some of these reported challenges in
the supplychain.
Discussion
Most of Moncler’s iconic puffer jackets have long been
produced in Eastern Europe, including at its in-house
production facility in Romania. The Italian supply chain
is more integral to Moncler’s product diversification
as part of a year-round brand strategy. Its supply
chain audit processes appear robust, and in response
to the risks, it has increased the number of audits it
conducts in Italy. Supply chain audits are necessary
but not sufficient, however, to address labour rights
risks. Purchasing practices are also central to suppliers’
ability to uphold labour rights, and Moncler has
initiatives that demonstrate a sophisticated level of
awareness of the issue. We learned how purchasing
teams are assessed and incentivised according to
the vendor rating assessment of environmental and
social risks identified in the supply chain audit process.
Moncler’s emphasis on capacity-building, rather than
simply imposing top-down sustainability standards
on the supply chain, also represents best practice.
Examples include free access to health and safety
experts, training programs on international standards,
and support for investments in machinery.
Outcome
This engagement helped further our understanding
of Moncler’s supply chain sourcing practices. Their
maturity means they are well-insulated, albeit far
from immune, from the labour rights risks inherent to
outsourced manufacturing in their supply chain. There
were learnings that will inform future engagements with
other luxury holdings.
Strategic report
Annual Report and Financial Statements 2025
44
© Mojahid Mottakin – stock.adobe.com
Prosus N.V.
Objective
This call was to discuss updates to the executive
remuneration policy that Prosus presented to
shareholders last year. The chief executive officer’s
(CEO) $100m moonshot award remains the central
point of contention, due to concerns around pay-for-
performance alignment.
Discussion
The CEO’s (Fabricio Bloisi) $100m moonshot remains
intact, with some tweaks at the margins of the
incentive structure. The moonshot’s target of doubling
Prosus/Naspers’ market cap could theoretically be
triggered by Tencent’s performance alone, which
contributes the majority of Prosus’ NAV. However,
this is a historic capital allocation decision and an
asset that remains outside of management’s control.
We reiterated our request for the introduction of a
mechanism to mitigate the risk of windfall gains for
executives resulting from Tencent’s performance alone
i.e., a sliding clawback provision that reduces the
size of the award the more that Tencent’s share price
appreciation contributes to thetarget.
Outcome
Given that that the moonshot award put to
shareholders at the 2025 annual general meeting
(AGM) remained intact, and the company had
not been receptive to our requests, we continued
to oppose remuneration. Although we regard
the CEO in high regard, we remain unconvinced
regarding the appropriateness and efficacy of this
incentivestructure.
45
Baillie Gifford European Growth Trust plc
Baillie Gifford –
proxy voting
We believe that ‘active ownership’ of our clients’
holdings is as important as selecting the right
investments in the first instance. These guidelines
are aligned with our stewardship principles and
describe our approach to proxy voting and company
engagement, the key levers of active ownership,
often described as ‘stewardship’.
While these guidelines are intended to provide an
insight into how we approach voting on our clients’
behalf, it is important to note that we assess every
company individually. In voting, we will always
evaluate proposals on a case-by-case basis, based
on what we believe to be in the best long-term
interests of our clients, rather than rigidly applying
apolicy.
A broad cross-section of our investment staff
areinvolved in our ongoing work on stewardship.
In the same way that our investment approach is
based around empowered and independent teams,
our voting and engagement is led by the individual
investment teams. In keeping with our decentralised
and autonomous culture, our investment teams will,
on occasion, elect to vote differently on the same
general meeting resolutions. Where this happens,
we report accordingly in the proxy voting disclosure
on our website. We also have clear processes in
place to identify, prevent and manage potential
proxy voting related conflicts of interest to ensure
that in all cases the firm acts in the clients’ best
interest. Baillie Gifford’s firm-wide conflict of interest
disclosure is available on its website.
Prior to taking any voting action, we usually address
specific ESG concerns by engaging directly with the
company, using voting as an escalation mechanism if
we have not seen sufficient progress.
Company meeting record
Voting distribution
Number of meetings voted
with management
84%
Number of meetings with at least
one against, withhold or abstain
16%
Number of votes for 96%
Number of votes against 4%
Strategic report
Annual Report and Financial Statements 2025
46
Name
Geography
Business
2025
Value
£’000
2025
% of total
assets
Bending Spoons Italy Mobile application software developer
35,298 8.7
Prosus Netherlands Portfolio of online consumer companies 20,237 5.0
Topicus.com Netherlands Acquirer of vertical market software companies 17,016 4.2
ASML Netherlands Semiconductor equipment manufacturer 16,826 4.1
Adyen Netherlands Online payments platform 14,688 3.6
Allegro.eu Poland Ecommerce platform 13,263 3.3
EQT Sweden Investment firm, investing in equity, ventures,
infrastructure and real estate
12,986 3.2
Vend Marketplaces Norway Media and classifieds advertising platforms 12,335 3.0
Roche Holding* Switzerland Pharmaceuticals and diagnostics company 12,333 3.0
Reply Italy IT consulting and systems integration provider 12,072 3.0
Ryanair Ireland Low-cost airline 12,025 3.0
Novo Nordisk Denmark Pharmaceutical company 10,363 2.6
Spotify Sweden Online audio streaming service 10,244 2.5
Sandoz* Sweden Generics & biosimilars pharmaceutical company 10,215 2.5
Sennder Germany Freight forwarder focused on road logistics 10,167 2.5
Kingspan Ireland Building materials provider 9,430 2.3
Lonza Switzerland Contract development and manufacturing
organisation
9,288 2.3
DSV Denmark Freight forwarder 9,044 2.2
Royal Unibrew Denmark Alcoholic and non-alcoholic beverages 8,950 2.2
Camurus Sweden Develops and commercialises therapeutic
medications
8,218 2.0
Hypoport Germany FinTech platform 7,827 1.9
EXOR Netherlands Investment company specialising in industrials 7,795 1.9
LVMH France Luxury goods 7,647 1.9
Moncler Italy Manufactures luxury apparel product 7,504 1.8
Assa Abloy Sweden Developer, designer and manufacturer in access
solutions market
7,443 1.8
Dino Polska Poland Grocery store chain 6,953 1.7
ASM International Netherlands Semiconductor equipment manufacturer 6,699 1.6
Sartorius Stedim Biotech France Pharmaceutical and laboratory equipment provider 6,610 1.6
Grupa Kęty* Poland Aluminium-extrusion and architectural systems
producer
6,507 1.6
Röko* Sweden Investment company acquiring niche small-to-mid
businesses across multiple industries.
6,199 1.5
List of
investments
As at 30 September 2025
47
Baillie Gifford European Growth Trust plc
Name
Geography
Business
2025
Value
£’000
2025
% of total
assets
Kinnevik Sweden Investment company specialising in digital consumer
businesses
5,720 1.4
Nexans France Cable manufacturing company 5,609 1.4
Richemont Switzerland Owner of luxury goods companies 5,489 1.4
Tekever Holdings* Portugal Manufacturer of AI-driven unmanned aerial and
satellite systems for defence and surveillance.
5,233 1.3
Epiroc Sweden Mining and infrastructure equipment provider 5,213 1.3
Atlas Copco Sweden Industrial group 5,179 1.3
Edenred* France Payments and employee-benefits platform 5,025 1.2
IMCD Netherlands Speciality chemicals distributor 4,828 1.2
Instalco Sweden Serial acquirer of technical installation businesses 4,282 1.1
Avanza Bank Sweden Online investment platform 4,208 1.0
Flix Germany Long-distance bus and train provider 4,162 1.0
Amplifon* Italy Hearing-aid retail and related hearing-care services 4,153 1.0
Soitec France Manufactures engineered substrates for
semiconductor wafers
3,680 1.0
Tonies Germany Musical storybox toys for children 2,375 0.6
AutoStore Norway Warehouse automation and cubic storage systems 1,817 0.5
McMakler Germany Digital real estate broker – 0.0
Northvolt Sweden Battery developer and manufacturer – 0.0
Total investments 403,155 99.2
Net liquid assets 3,052 0.8
Total assets 406,207 100.0
Borrowings (52,291) (13.0)
Shareholders' funds 353,916 8 7. 0
Details of the ten largest investments are given on pages 18 to 21 along with comparative valuations.
Denotes unlisted investment (private company).
* New holdings bought during the year (Beijer Ref, CRISPR Therapeutics, Dassault Systemes, Eurofins, Genmab, Mettler Toledo, Vitec Software,
VNVGlobal and Wizz Air Holdings were sold during the period).
Strategic report
Annual Report and Financial Statements 2025
48
Distribution
of total assets
*
Sector 2025
Geographical 2025
1
2
3
4
6
5
7
8
9
10
* Total assets represents total net assets before deduction of borrowings.
3
4
5
7
2
6
1
Sector 2025
%
2024
%
1 Information Technology 26.1 26.2
2 Industrials 21.1 30.1
3 Health Care 15.1 10.1
4 Financials 12.8 13.5
5 Consumer Discretionary 10.6 11.9
6 Technology 9.6 4.4
7 Consumer Staples 3.9 2.2
8 Net liquid assets 0.8 0.6
9 Real Estate – 0.2
10 Consumer Services – 0.8
Geographical 2025
%
2024
%
1 Netherlands 21.6 23.9
2 Sweden 19.6 19.0
3 Italy 14.5 7.3
4 France 7.1 10.4
5 Denmark 7.0 8.8
6 Switzerland 6.7 5.5
7 Poland 6.6 4.1
8 Germany 6.0 7. 7
9 Ireland 5.3 7. 1
10 Norway 3.5 4.8
11 Portugal 1.3 –
12 Net liquid assets 0.8 0.6
13 Hungary – 0.8
Governance
report
This governance report, which includes
pages 50 to 73, outlines the Board’s
approach to the governance of your
Company. We believe that good governance
builds better outcomes and we are
committed to high standards of corporate
governance and transparency.
Governance report
Annual Report and Financial Statements 2025
50
Directors and
management
David Barron
Chairman
Appointed 2023
David Barron has spent 25 years working in the
investment management sector and until November
2019 was chief executive officer of Miton Group
PLC following six years with the firm. Prior to this he
was head of investment trusts at JP Morgan Asset
Management for more than ten years having joined
Robert Fleming in 1995. He is currently chairman of
the audit committee of BlackRock American Income
Trust plc. He was also a non-executive director of
Premier Miton Group PLC until 7 July 2023. He was
appointed a Director of the Company on 1 October
2023 and Chairman on 5February 2025.
Directors
Emma Davies
Director
Appointed 2021
Emma Davies (Senior Independent Director) is an
experienced investment professional who has spent
her career investing across global equity markets,
as well as in the property and private equity markets
in the UK. She has a sophisticated understanding
of ESG considerations, particularly with regard to
social and governance concerns. She is currently
the chief investment officer at Guy’s & St Thomas’
Foundation and is also a non-executive director and
chair of the audit and risk committee of Riverstone
Credit Opportunities Income Plc. She was appointed
aDirector of the Company in 2021.
51
Baillie Gifford European Growth Trust plc
Davina Curling
Director
Appointed 2024
Davina Curling has over 30 years of fund management
experience. She was managing director and head
of Pan European equities at Russell Investments.
Prior to that she was head of European equities at
F&C, ISIS and Royal & SunAlliance. Davina has also
held positions at Nikko Capital Management (UK)
and Kleinwort Benson and was previously senior
independent director of BlackRock Greater Europe
Investment Trust plc, retiring at the end of her tenure
in 2023. Davina is currently the senior independent
director of abrdn Asia Focus plc. She was appointed a
Director of the Company on 1November 2024.
Andrew Watkins was head of client relations, sales
and marketing for Invesco Perpetual’s listed
investment funds business until his retirement in
June 2017. He is currently chairman of Ashoka India
Equity Investment Trust plc and CT UK High Income
Trust plc, a director of Chelverton UK Dividend Trust
plc and Consistent Unit Trust Management Company
Limited. He was appointed a Director of the
Company in 2019 and Chairman of the Audit
Committee in 2024.
Andrew Watkins
Audit Committee
Chair
Appointed 2019
All of the Directors are members of the Audit Committee.
Governance report
Annual Report and Financial Statements 2025
52
Managers and secretaries
The Company has appointed Baillie Gifford & Co
Limited, a wholly owned subsidiary of Baillie Gifford
& Co, as its Alternative Investment Fund Managers
(‘AIFM’) and Company Secretary. Baillie Gifford &
Co Limited has delegated investment management
services to Baillie Gifford & Co. Baillie Gifford & Co
is an investment management firm formed in 1927
out of the legal firm Baillie Gifford, WS, which had
been involved in investment management since 1908.
Baillie Gifford is one of the largest investment
trust managers in the UK and currently manages
twelve closed-end investment companies. Baillie
Gifford also manages unit trusts and open ended
investment companies, together with investment
portfolios on behalf of pension funds, charities
and other institutional clients, both in the UK and
overseas. Funds under the management or advice
of Baillie Gifford totalled around £205billion as at
4December 2025. Basedin Edinburgh, it is one of
the leading privately owned investment management
firms in the UK, with 59partners and a staff of
around 1,640.
The Managers of Baillie Gifford European Growth
Trust are Stephen Paice and Chris Davies. Stephen
is Head of the European Equity Team and became
a partner of Baillie Gifford & Co on 1 April 2024.
Chrisis an Investment Manager in the European
Equity Team.
Baillie Gifford & Co and Baillie Gifford & Co Limited
are both authorised and regulated by the Financial
Conduct Authority.
53
Baillie Gifford European Growth Trust plc
The Directors present their
Reporttogether with the
audited Financial Statements
of the Company for the year to
30September 2025.
Directors’
report
Corporate governance
The Corporate governance report is set out on
pages58 to 64 and forms part of this Report.
Managers and Company Secretaries
Baillie Gifford & Co Limited, a wholly owned
subsidiary of Baillie Gifford & Co, was appointed
asthe Company’s Alternative Investment Fund
Manager (‘AIFM’) and Company Secretaries on
29November 2019. Baillie Gifford & Co Limited
has delegated portfolio management services to
Baillie Gifford & Co. Dealing activity and transaction
reporting has been further sub-delegated to
BaillieGifford Overseas Limited and Baillie Gifford
Asia (Hong Kong) Limited.
The Investment Management Agreement between
the AIFM and the Company sets out the matters over
which the Managers have authority in accordance
with the policies and directions of, and subject to
restrictions imposed by, the Board. The Investment
Management Agreement is terminable on not less
than three months’ notice or on shorter notice in
certain circumstances. Compensation would only be
payable if termination occurred prior to the expiry
of the notice period. The annual management fee
is 0.55% of the lower of (i) the Company’s market
capitalisation and (ii) the Company’s net asset
value (which shall include income), in either case
up to £500 million, and 0.50% of the amount of
the lower of the Company’s market capitalisation or
net asset value above £500 million, calculated and
payablequarterly.
Governance report
Annual Report and Financial Statements 2025
54
Careful consideration has been given by the Board
as to the basis on which the management fee is
charged. The Board considers that maintaining a
relatively low ongoing charges ratio is in the best
interests of the shareholders. The Board is also of
the view that calculating the fee with reference to
performance would be unlikely to exert a positive
influence over the long-term performance.
The Board considers the Company’s investment
management and secretarial arrangements on an
ongoing basis and a formal review is conducted
annually. The Board considered, amongst others,
the following topics in its review: the quality of the
personnel assigned to handle the Company’s affairs;
the investment process and the results achieved to
date; investment performance; the administrative
services provided by the Secretaries and the quality
of information provided; the marketing efforts
undertaken by the Managers; the relationship with
the Managers; and comparative peer group charges
and fees.
Following the most recent review, the Board
concluded that the continuing appointment of Baillie
Gifford & Co Limited as AIFM and the delegation of
investment management services to Baillie Gifford
& Co, on the terms agreed, is in the interests of
shareholders as a whole.
Depositary
In accordance with the Alternative Investment Fund
Managers Regulations, Northern Trust Investor
Services has been appointed as Depositary to
theCompany.
The Depositary’s responsibilities include cash
monitoring, safe keeping of the Company’s
financial instruments, verifying ownership and
maintaining a record of other assets and monitoring
the Company’s compliance with investment limits
and leverage requirements. Custody services are
provided by The Northern Trust Company (as a
delegate of the Depositary) (‘the Custodian’).
Directors
Information about the Directors, including their
relevant experience, can be found on pages 50
and51.
All Directors will retire at the Annual General
Meeting and offer themselves for re-election.
Following a formal performance evaluation, the
Chairman confirms that the Board considers that
their performance continues to be effective and
each remains committed to the Company. Their
contribution to the Board is greatly valued and the
Board recommends their re-election to shareholders.
Director indemnification and insurance
The Company has entered into qualifying third party
deeds of indemnity in favour of each of its Directors.
The deeds, which were in force during the year to
30 September 2025 and up to the date of approval
of this report, cover any liabilities that may arise to a
third party, other than the Company, for negligence,
default or breach of trust or duty. The Directors
are not indemnified in respect of liabilities to the
Company, any regulatory or criminal fines, any costs
incurred in connection with criminal proceedings in
which the Director is convicted or civil proceedings
brought by the Company in which judgement is
given against her or him. In addition, the indemnity
does not apply to any liability to the extent that it is
recovered from another person.
The Company maintains Directors’ and Officers’
liability insurance.
Conflicts of interest
Each Director submits a list of potential conflicts of
interest to the Board for consideration and approval
at each meeting. The Board considers these
carefully, taking into account the circumstances
surrounding them prior to authorisation. Having
considered the lists of potential conflicts there were
no situations which gave rise to a direct or indirect
interest of a Director which conflicted with the
interests of the Company.
Dividends
The Board recommends a final dividend of 0.72pper
ordinary share (2024 – 0.60p). Dividends will only be
paid to the extent needed to maintain the Company’s
investment trust status.
If approved by shareholders at the Annual General
Meeting, the recommended final dividend per
ordinary share will be paid on 13 February 2026
to shareholders on the register at the close of
business on 9January 2026. The ex-dividend
date is 8January 2026. The Company’s Registrar
offers aDividend Reinvestment Plan (see page 110)
and thefinal date for elections for this dividend is
23January 2026.
Share capital
Capital structure
The Company’s capital structure at 30 September
2025 consists of 402,443,690 ordinary shares
of 2.5p each (2024 – 402,443,690) of which
324,722,867 (2024 – 351,783,279) are allotted and
fully paid and 77,720,823 (2024 – 50,660,411) are
held in treasury.
55
Baillie Gifford European Growth Trust plc
There are no restrictions concerning the holding or
transfer of the Company’s ordinary shares and there
are no special rights attached to any of the shares.
Dividends
The ordinary shares carry a right to receive
dividends. Interim dividends are determined by the
Directors, whereas the proposed final dividend is
subject to shareholder approval.
Capital entitlement
On a winding up, after meeting the liabilities of the
Company, the surplus assets will be paid to ordinary
shareholders in proportion to their shareholdings.
Voting
Each ordinary shareholder present in person or by
proxy is entitled to one vote on a show of hands and,
on a poll, to one vote for every share held.
Information on the deadlines for proxy appointments
can be found on pages 106 to 108.
Major interests disclosed in the Company’s shares
The Company has received notifications in
accordance with the Financial Conduct Authority’s
Disclosure and Transparency Rule 5.1.2R of the
following interests in 3% or more of the voting rights
attached to the Company’s issued share capital.
Name
Number of
ordinary 2.5p
shares held at
30September
2025
% of
issue*
Allspring Global Investments Holdings 62,902,608 19.4%
City of London Investment
Management Company Ltd
42,671,214 13.1%
1607 Capital Partners LLC 36,417,693 11.2%
Investec Wealth & Investment Ltd 18,433,790 5.7%
Charles Stanley 17,973,280 5.5%
Saba Capital Management, L.P.
†
15,892,544 4.9%
* Ordinary shares in issue excluding treasury shares.
† Including shares held through Total Return Swaps.
During the period from 30 September 2025 to
4December 2025, the Company was notified
that Allspring Global Investments Holdings held
65,167,172 (21.2% of the shares in issue as at
4December 2025, City of London Investment
Management Company Ltd held 39,974,911 (13.0%
of the shares in issues as at 4 December 2025)
and the Company was advised that Saba Capital
Management, L.P no longer holds any voting rights
in the Company. There have been no other changes
to the major interests in the Company’s shares
intimated up to 4December 2025.
Analysis of Shareholders at 30 September
2025
Number of
shares held
2025
%
2024
Number of
shares held
2024
%
Institutions 166,295,985 51.2 161,776,710 46.0
Intermediaries/
Retail Savings
Platforms
124,202,962 38.3 156,559,705 44.5
Individuals 18,476,674 5.7 22,109,766 6.3
Marketmakers 15,747,246 4.8 11,337,098 3.2
324,722,867 100.0 351,783,279 100.0
Annual General Meeting
The details of this year’s AGM, including the
proposed resolutions and information on the
deadlines for proxy appointments, can be found on
pages 106 to 108. Shareholders who hold shares in
their own name on the main register will be provided
with a Form of Proxy. If you hold shares through a
share platform or other nominee, the Board would
encourage you to contact these organisations
directly as soon as possible to arrange for you to
vote at the AGM. The resolutions relating to the
renewal of the Directors’ authorities to issue and
buyback shares are explained in more detail below.
Authority to hold general meetings at shorter notice
Resolution 14, which is proposed as a special
resolution, seeks authority for the Directors to
convene general meetings of the Company, other
than Annual General Meetings (‘AGMs’), on a
minimum of 14 clear days’ notice. The notice period
for AGMs will remain at 21 clear days. The approval
will be effective until the Company’s next AGM,
atwhich it is intended that renewal will be sought.
The Directors will only call general meetings on
14clear days’ notice where they consider it in the
best interests of shareholders to do so and the
relevant matter requires to be dealt with expediently.
Share issuance authority
Resolution 11 in the Notice of Annual General Meeting
seeks to renew the Directors’ general authority to
issue shares up to an aggregate nominal amount of
£2,560,023. This amount represents one-third of
the Company’s total ordinary share capital currently
in issue and meets institutional guidelines. No issue
of ordinary shares will be made pursuant to the
authorisation of Resolution 11 which would effectively
alter the control of the Company without the prior
approval of shareholders in general meeting.
Governance report
Annual Report and Financial Statements 2025
56
Resolution 12, which is proposed as a special
resolution, seeks authority for the Directors to
issueshares or sell shares held in treasury on a
non pre-emptive basis for cash up to an aggregate
nominal amount of £768,007 (representing 10% of
the issued ordinary share capital of the Company as
at 4 December 2025). This authority will continue
until the conclusion of the Annual General Meeting
to be held in 2027 or on the expiry of 15 months
from the passing of the resolution, if earlier.
Such authorities will only be used to issue shares or
sell shares from treasury at a premium to NAV and
only when the Directors believe that it would be in
the best interests of the Company to do so.
During the year to 30 September 2025, no shares
(2024– no shares) were issued from treasury.
Market purchases of own shares
At the last Annual General Meeting the Company
was granted authority to purchase up to 52,140,104
ordinary shares (equivalent to 14.99% of its issued
share capital), such authority to expire at the 2026
Annual General Meeting. The Directors are seeking
shareholders’ approval at the Annual General
Meeting to renew the authority to make market
purchases of up to 14.99% of the Company’s
ordinary shares in issue (excluding treasury shares)
atthe date of passing of the resolution, such
authority to expire at the Annual General Meeting
of the Company to be held in 2027. Such purchases
will only be made at a discount to the prevailing NAV.
During the year to 30 September 2025, 27,060,412
shares (representing 7.7% of issued share capital
at 30September 2024) at a discount to net asset
value at a cost of £26,852,000 (2024 – 6,365,921
shares) were bought back under the buy-back
authority. Between 1 October and 4December 2025,
17,520,000 shares were bought back. 95,240,823
shares were held in treasury as at 4 December 2025
(representing 24% of the sharecapital).
The Company may hold bought-back shares in
treasury and then:
(i) sell such shares (or any of them) for cash (or its
equivalent under the Companies Act 2006); or
(ii) cancel the shares (or any of them).
Shares will only be resold from treasury at a
premium to NAV.
Treasury shares do not receive distributions and the
Company will not be entitled to exercise the voting
rights attaching to them.
In accordance with the Listing Rules, the maximum
price (excluding expenses) that may be paid on
the exercise of the authority must not exceed the
higherof:
(i) 5 per cent. above the average closing price
on the London Stock Exchange of an ordinary
share over the five business days immediately
preceding the date of purchase; and
(ii) the higher of the price of the last independent
trade and the highest current independent bid
on the London Stock Exchange.
The minimum price (exclusive of expenses) that
may be paid will be the nominal value of an ordinary
share. Purchases of ordinary shares will be made
within guidelines established, from time to time,
bythe Board. Your attention is drawn to Resolution
13 in the Notice of Annual General Meeting.
Thisauthority, if conferred, will only be exercised if
to do so would result in an increase in NAV for the
remaining shareholders and if it is considered in the
best interests of shareholders generally.
Recommendation
The Directors unanimously recommend you vote in
favour of the resolutions to be proposed at the Annual
General Meeting as it is their view that the resolutions
are in the best interests of shareholders as a whole.
Financial instruments
The Company’s financial instruments comprise its
investment portfolio, cash balances, borrowings
and debtors and creditors that arise directly from
its operations such as sales and purchases awaiting
settlement and accrued income. The financial risk
management objectives and policies arising from
its financial instruments and the exposure of the
Company to risk are disclosed in note 19 to the
Financial Statements.
57
Baillie Gifford European Growth Trust plc
Future developments of the Company
The outlook for the Company is set out in the
Chairman’s statement on pages 07 to 10 and in the
Managers report on pages 11 to 17.
Articles of Association
The Company’s Articles of Association may only be
amended by special resolution at a general meeting
of shareholders.
Disclosure of information to Auditor
The Directors confirm that, so far as each of
the Directors is aware, there is no relevant audit
information of which the Company’s Auditor is
unaware and the Directors have taken all the steps
that they might reasonably be expected to have
taken as Directors in order to make themselves
aware of any relevant audit information and to
establish that the Company’s Auditor is aware of
thatinformation.
Independent Auditor
The Auditor, BDO LLP, is willing to continue
in office, and in accordance with section 489
and section 491(1) of the Companies Act 2006,
resolutions concerning BDO LLP’s reappointment
and remuneration will be submitted to the Annual
General Meeting.
Post Balance Sheet events
The Directors confirm, up to 8December 2025, that
there have been no significant post Balance Sheet
events which require adjustment to the Financial
Statements.
Stakeholder engagement
Although the Company has no employees, trade
suppliers or customers, the Directors give regular
consideration to the need to foster the Company’s
business relationships with its stakeholders, in
particular with shareholders, its externally appointed
Managers, other professional service providers
and lenders. The effect of this consideration upon
the key decisions taken by the Company during
the financial year is set out in further detail in the
Strategic report on pages 37 to 39.
Greenhouse gas emissions and Streamlined
Energy & Carbon Reporting (‘SECR’)
All of the Company’s activities are outsourced
to third parties. The Company therefore has no
greenhouse gas emissions to report from its
operations, nor does it have responsibility for
any other emissions producing sources under
the Companies Act 2006 (Strategic Report and
Directors’ Reports) Regulations 2013. For the
same reasons as set out above, the Company
considers itself to be a low energy user under the
SECR regulations and has no energy and carbon
information to disclose.
Bribery Act
The Company has a zero tolerance policy towards
bribery and is committed to carrying out business
fairly, honestly and openly. The Managers also adopt
a zero tolerance approach and have policies and
procedures in place to prevent bribery.
Criminal Finances Act 2017
The Company has a commitment to zero tolerance
towards the criminal facilitation of tax evasion.
On behalf of the Board
David Barron
Chairman
8 December 2025
Governance report
Annual Report and Financial Statements 2025
58
Compliance
The FRC has confirmed that AIC member companies
who report against the AIC Code will be meeting
their obligations in relation to the UK Code. The
Board confirms that the Company has complied
throughout the year under review with the relevant
provisions of the UK Code and the recommendations
of the AIC Code except as follows:
• a Nomination Committee has not been
established. As the Board is comprised entirely
of non-executive Directors and is small in size, a
Nomination Committee is considered unnecessary.
• the Company has no executive Directors and
no employees and consequently does not have
a Remuneration Committee. The Directors’
Remuneration report on pages 68 to 71 provides
information on the remuneration arrangements
for the Directors of the Company. The Chairman
is available to engage with shareholders on issues
relating to Directors’ remuneration where required.
• given the small size of the Board and the fact that
all Directors are independent, the Company does
not have a Management Engagement Committee.
The Company’s management functions are
delegated to the AIFM, who has delegated the
management of the Company’s investment
portfolio to the Investment Manager, Baillie
Gifford & Co. The Board reviews at least annually
the performance of the AIFM, the terms of its
engagement and the continued appointment of
the AIFM. The Board also reviews the performance
of the Investment Manager.
• the Audit Committee comprises all Directors
of the Company. The Chairman is a member of
the Audit Committee as he was independent on
appointment.
Corporate
governance report
The Board is committed to
achieving and demonstrating
high standards of Corporate
Governance. This statement
outlines how the principles of the
2018 UK Corporate Governance
Code (the ‘UK Code’) which
can be found at frc.org.uk and
the relevant principles of the
Association of Investment
Companies (‘AIC’) Code of
Corporate Governance (the ‘AIC
Code’) published in 2019 were
applied throughout the financial
year. The AIC Code provides
a framework of best practice
for investment companies and
can befound at theaic.co.uk.
The Board is also mindful of
the updated UK Corporate
Governance Code 2024, the
majority of its provisions will
apply to the financial year ending
30September 2026.
59
Baillie Gifford European Growth Trust plc
The Board
The Board has overall responsibility for the
Company’s affairs. It has a number of matters
formally reserved for its approval including strategy,
investment policy, gearing, share buy-back and
issuance policy, treasury matters, dividend and
corporate governance policy. The Board seeks to
contribute to the delivery of the Company’s strategy
by engaging with the Managers in a collaborative
and collegiate manner with open and respectful
discussion and debate being encouraged, whilst
also ensuring that appropriate and regular challenge
is brought and evaluation is conducted. The Board
also reviews the Financial Statements, investment
transactions, revenue budgets and performance of
the Company. Full and timely information is provided
to the Board to enable it to function effectively and
to allow Directors to discharge their responsibilities.
As at 30 September 2025 the Board comprised
four Directors, all of whom are non-executive.
The Chairman is responsible for organising the
business of the Board, ensuring its effectiveness and
setting its agenda. The executive responsibility for
investment management has been delegated to the
Company’s Alternative Investment Fund Manager
(‘AIFM’), Baillie Gifford & Co Limited, and, in the
context of a Board comprising only non-executive
Directors, there is no chief executive officer. The
Senior Independent Director is Emma Davies.
The Directors believe that the Board has a balance
of skills and experience that enables it to provide
effective strategic leadership and proper governance
of the Company. Information about the Directors,
including their relevant experience, can be found
onpages 50 and 51.
There is an agreed procedure for Directors to seek
independent professional advice, if necessary,
attheCompany’s expense.
Appointments to the Board
The terms and conditions of Directors’ appointments
are set out in formal letters of appointment which are
available for inspection on request.
Under the provisions of the Company’s Articles
of Association, Directors are subject to election
by shareholders at the first AGM after their
appointment. Thereafter, at each AGM any Director
who has not stood for re-election at either of the
two preceding AGMs is required to retire and offer
themselves for re-election. In addition, one third
of the Directors eligible to retire by rotation shall
retire from office at each AGM. Beyond these
requirements, it has been agreed that all Directors
will seek annual re-election at the Company’s AGMs.
Independence of Directors
All the Directors are considered by the Board to
be independent of the Managers and free of any
business or other relationship which could interfere
with the exercise of their independent judgement.
The Directors recognise the importance of
succession planning for company boards and review
the Board’s composition annually. The Board is of
theview that length of service will not necessarily
compromise the independence or contribution of
directors of an investment trust company, where
continuity and experience can be a benefit to the
Board. The Board concurs with the view expressed in
the AIC Code that long-serving Directors should not
be prevented from being considered independent.
In accordance with the AIC Code of Corporate
Governance, all Directors are subject to annual
re-election. Following a formal performance
evaluation, the Board concluded that its members
continued to be independent in character and
judgement and their skills and experience added
significantly to the strength of the Board.
Governance report
Annual Report and Financial Statements 2025
60
BDO LLP
Auditor
Northern Trust
Investor Services
Limited
Depositary and
custodian
Peel Hunt LLP
Company broker
Board of Directors
Comprises independent
non-executive directors*
Chairman: David Barron
SeniorIndependent Director:
Emma Davies
Audit
Committee
Chair: Andrew Watkins
Purpose:
To provide oversight of:
• the financial reporting process;
• the audit process;
• the Company’s system of internal controls; and
• compliance with laws and regulations.
Nomination
Committee
Chair: David Barron
Purpose:
To oversee:
• Board recruitment;
• succession planning; and
• Board appraisals including identifying training
needs.
Third-party service providers
appointed by the Board
Dashed arrows indicate reporting lines
* The independent non executive directors are made up of David Barron, Emma Davies, Andrew Watkins and Davina Curling. Further details on their
experience and contribution to the Board can be found on pages 51 and 52.
Baillie Gifford & Co
Alternative Investment Fund
Manasgers and Company
Secretaries:
Baillie Gifford & Co Limited (wholly
owned subsidiary of Baillie Gifford & Co)
Dealing activity and transaction reporting:
Baillie Gifford Overseas Limited and
Baillie Gifford Asia (Hong Kong) Limited
Portfolio management:
Baillie Gifford & Co
Computershare
Investor Services
PLC
Registrar
61
Baillie Gifford European Growth Trust plc
Meetings
There is an annual cycle of Board meetings
whichisdesigned to address, in a systematic
way, overall strategy, review of investment policy,
investment performance, marketing, revenue
budgets, dividend policy and communication
with shareholders. The Board considers that it
meets sufficiently regularly to discharge its duties
effectively. The table below shows the attendance
record for the Board and Committee meetings held
during the year. The Annual General Meeting was
attended by all Directors serving at that date.
Directors’ attendance at meetings
Board
Audit
Committee
Number of meetings 5 4
David Barron 5 4
Davina Curling
#
5 4
Emma Davies 5 4
Andrew Watkins 5 4
Michael MacPhee
*
2 2
#
Appointed on 1 November 2024.
* Retired on 5 February 2025.
Policy on Chairman’s tenure
The Board’s policy is that the Chairman will serve for
no longer than nine years, other than in exceptional
circumstances for the benefit of the Company.
Performance evaluation
An appraisal of the Chairman, each Director and a
performance evaluation and review of the Board as
a whole and the Audit Committee was carried out
during the year. Each Director and the Chairman
responded to an evaluation questionnaire. The
Chairman’s appraisal was led by Emma Davies, the
Senior Independent Director. The appraisals and
evaluations considered, amongst other criteria,
the balance of skills of the Board, training and
development requirements, the contribution of
individual Directors and the overall effectiveness
of the Board and the Audit Committee. Following
this process it was concluded that there was a
diverse range of skills within the Board, and the
performance of each Director, the Chairman, the
Board and the Audit Committee continues to be
effective and that each Director and the Chairman
remain committed to the Company.
A review of the Chairman’s and the other Directors’
commitments was carried out and the Board is
satisfied that they are capable of devoting sufficient
time to the Company. There were no significant
changes to the Chairman’s other commitments
during the year.
Diversity
Appointments to the Board are made on merit with
due regard for the benefits of diversity including
gender, social and ethnic backgrounds, cognitive
and personal strengths. The priority in appointing
new Directors is to identify the candidate with the
best range of skills and experience to complement
existing Directors. Within the context of a small,
entirely non-executive Board, a single appointment
or retirement can have a significant impact on
percentage representation, and a limited number of
senior roles are available. The Board will endeavour
to comply with the UK Listing Rules diversity targets
more often than not but notes that an orderly
succession plan can, when implemented thoughtfully
and having regard to the best interests of the
Company and its shareholders, take a significant
period of time to develop and may result in periods
when the diversity targets are not met.
Board composition
In order to fulfil its obligations, the Board recognises
the importance of having a range of skilled and
experienced Directors, balancing the benefits of
length of service and knowledge of the Company
with the desirability of ensuring regular refreshment
of the Board. The Board reviews its composition
annually.
The following disclosures are provided in respect
of the UK Listing Rules targets that: i) 40% of a
board should be women; ii) at least one senior role
should be held by a woman; and iii) at least one
board member should be from a non-white ethnic
background, as defined by the Office of National
Statistics criteria.
As an externally managed investment company
with no chief executive officer or chief financial
officer, the roles which qualify as senior under FCA
guidance are Chair and Senior Independent Director
(‘SID’). The Board also considers Audit Committee
Chair to represent a senior role within this context.
The Board has resolved that the Company’s year
end date be the most appropriate date for disclosure
purposes.
Governance report
Annual Report and Financial Statements 2025
62
As at 30 September 2025, the Board did not comply
with the UK Listing Rule target with respect to ethnic
background but met the 40% target for women. The
Board considers that its small size is the principal
reason why the Listing Rule targets were not met.
The Board supports, and is ambitious to meet, all
the Listing Rule diversity targets and will continue
to review its size and composition both as part of its
refreshment cycle and more widely. There have been
no changes since 30 September 2025, data has
been collected on a self-reporting basis.
Gender identity Number %
Senior
roles
Men 2 50
1
Women 2 50
1
Prefer not to say – – –
* The Board Chairman and SID being senior positions in accordance with the UK
Listing Rules. The Board also considers the Audit Committee Chair to be a senior
position. The Audit Committee Chair is a man.
Ethnic background Number %
Senior
roles
White 4 100
2
Prefer not to say – – –
* The Board Chairman and SID, being senior positions in accordance with the UK
Listing Rules. The Board also considers the Audit Committee Chair to be a senior
position. The Audit Committee Chair’s ethnic background is White.
All recruitment for new Board members will be
external, through the use of an external recruitment
agency. The recruitment agency will be engaged
to undertake the selection of a list of suitable
candidates for consideration and approval by
the Board. The external recruitment agency will
be asked to put forward candidates with the
desired skillset and also with a diverse range of
backgrounds, cultures and identities. The Board
will take the Listing Rule diversity targets and any
other best practice matters into account when
determining the appropriateness of a candidate and
final appointment.
Induction and training
New directors are provided with an induction
programme which is tailored to the particular
circumstances of the appointee. Regular briefings
were provided during the year on industry and
regulatory matters. Directors receive other relevant
training as necessary.
Audit Committee
The report of the Audit Committee is set out on
pages 65 to 67.
Internal controls and risk management
The Directors acknowledge their responsibility
forthe Company’s risk management and
internal control systems and for reviewing their
effectiveness, including with regard to preparation
of the Company’s Annual Report and Financial
Statements. The systems are designed to manage
rather than eliminate the risk of failure to achieve
business objectives and can only provide reasonable
but not absolute assurance against material
misstatement or loss.
The Board confirms that there is an ongoing
process for identifying, evaluating and managing
the significant risks faced by the Company in
accordance with the FRC guidance ‘Guidance on
Risk Management, Internal Control and Related
Financial and Business Reporting’.
The practical measures in relation to the design,
implementation and maintenance of control policies
and procedures to safeguard the Company’s
assets and to manage its affairs properly, including
the maintenance of effective operational and
compliance controls have been delegated to the
Managers and Secretaries.
The Board oversees the functions delegated to the
Managers and Secretaries and the controls managed
by the AIFM in accordance with the UK Alternative
Investment Fund Managers Regulations (as detailed
below). Baillie Gifford & Co’s Internal Audit and
Compliance Departments and the AIFM’s permanent
risk function provide the Audit Committee with
regular reports on their monitoring programmes.
The reporting procedures for these departments
are defined and formalised within a service level
agreement. Baillie Gifford & Co conducts an annual
review of its system of internal controls which is
documented within an internal controls report which
complies with ISAE 3402 – Assurance Reports on
Internal Controls of Service Organisations made
available to Third Parties. This report is independently
reviewed by Baillie Gifford & Co’s Auditor and a copy
is submitted to the Audit Committee.
A report identifying the material risks faced by the
Company and the key controls employed to manage
these risks is reviewed by the Audit Committee.
These procedures ensure that consideration is given
regularly to the nature and extent of risks facing the
Company and that they are being actively monitored.
Where changes in risk have been identified during
the year they also provide a mechanism to assess
whether further action is required to manage
theserisks.
63
Baillie Gifford European Growth Trust plc
The Directors confirm that they have reviewed the
effectiveness of the Company’s risk management
and internal controls systems, which accord with the
FRC ‘Guidance on Risk Management, Internal Control
and Related Financial and Business Reporting’
and they have procedures in place toreview their
effectiveness on a regular basis. Nosignificant
weaknesses were identified in the year under review
and up to the date of this Annual Report.
The Board confirms that these procedures have
been in place throughout the Company’s financial
year and continue to be in place up to the date of
approval of this Annual Report.
To comply with the Alternative Investment Fund
Managers Regulations, Northern Trust Investor
Services acts as the Company’s Depositary and
Baillie Gifford & Co Limited as its AIFM.
The Depositary’s responsibilities include cash
monitoring, safe keeping of the Company’s financial
instruments, verifying ownership and maintaining
a record of other assets and monitoring the
Company’s compliance with investment limits and
leverage requirements. The Depositary is liable for
the loss of financial instruments held in custody.
The Company’s Custodian is The Northern Trust
Company. The Custodian prepares reports on its key
controls and safeguards which are independently
reviewed by KPMG LLP. The reports are reviewed
by Baillie Gifford’s Business Risk Department and a
summary of the key points is reported to the Audit
Committee and any concerns are investigated.
The Depositary provides the Audit Committee with a
report on its monitoring activities.
The AIFM has established a permanent risk
management function to ensure that effective risk
management policies and procedures are in place
and to monitor compliance with risk limits. The AIFM
has a risk management policy which covers the risks
associated with the management of the portfolio,
and the adequacy and effectiveness of this policy
is reviewed and approved at least annually. This
review includes the risk management processes and
systems and limits for each risk area.
The risk limits, which are set by the AIFM and
approved by the Board, take into account the
objectives, strategy and risk profile of the portfolio.
These limits, including leverage (see page 113), are
monitored and the sensitivity of the portfolio to key
risks is undertaken periodically as appropriate to
ascertain the impact of changes in key variables
in the portfolio. Exceptions from limits monitoring
and stress testing undertaken by Baillie Gifford’s
Business Risk Department are escalated to the AIFM
and reported to the Board along with any remedial
measures being taken.
Going concern
In accordance with the Financial Reporting Council’s
guidance on going concern and liquidity risk, the
Directors have undertaken a rigorous review of the
Company’s ability to continue as a going concern.
The Company’s principal and emerging risks are
market related. An explanation of these risks and
how they are managed is on pages 32 to 36 and
contained in note 19 to the Financial Statements.
The Board has, in particular, considered the
impact of heightened market volatility due to
macroeconomic and geopolitical concerns and has
conducted specific leverage and liquidity stress
testing but does not believe the Company’s going
concern status is affected.
The Company’s assets, which at present are mainly
investments in quoted securities which are readily
realisable, exceed its liabilities significantly. All
borrowings require the prior approval of the Board.
Gearing levels and compliance with borrowing
covenants are reviewed by the Board on a regular
basis. The Company has continued to comply
with the investment trust status requirements of
section 1158 of the Corporation Tax Act 2010 and
the Investment Trust (Approved Company) (Tax)
Regulations 2011.
The Company’s primary third party suppliers,
including its Managers and Secretaries, Custodian,
Depositary, Registrar, Auditor and Corporate
Broker, are not experiencing significant operational
difficulties affecting their respective services to the
Company.
Accordingly, the Financial Statements have been
prepared on the going concern basis as it is the
Directors’ opinion, having assessed the principal and
emerging risks and other matters, as set out in the
Viability Statement on page 31, that the Company
will continue in operational existence for a period of
at least 12 months from the date of approval of these
Financial Statements.
Governance report
Annual Report and Financial Statements 2025
64
Relations with shareholders
The Board places great importance on
communication with shareholders. The Company’s
Managers meet regularly with shareholders and
their representatives. The Chairman and Senior
Independent Director also meet shareholders
independently of the Managers and report
shareholders’ views to the Board. Shareholders
wishing to communicate with any members of
the Board may do so by writing to them at the
Company’s registered office or through the
Company’s broker, Peel Hunt LLP (see contact
details on page 119). All correspondence
addressed to the Chairman is dealt with directly
bytheChairman.
The Company’s Annual General Meeting provides
a further forum for communication with all
shareholders. The level of proxies lodged for each
resolution is announced at the meeting and is
published at bgeuropeangrowth.com subsequent
to the meeting. The notice period for the Annual
General Meeting is at least 21 clear days.
Shareholders and potential investors may obtain
up-to-date information from the Company’s page on
the Managers’ website at bgeuropeangrowth.com.
Corporate governance and stewardship
The Board believes that it is in the shareholders’
interests to consider environmental, social and
governance (‘ESG’) factors including climate change
when selecting and retaining investments and
has asked the Managers to take these issues into
account. The Managers do not exclude companies
from their investment universe purely on the grounds
of ESG factors but adopt a positive engagement
approach whereby matters are discussed with
management with the aim of improving the relevant
policies and management systems and enabling
the Managers to consider how ESG factors could
impact long-term investment returns. The Managers’
Statement of Compliance with the UK Stewardship
Code can be found on the Managers’ website:
bailliegifford.com.
The Company has given discretionary voting powers
to Baillie Gifford & Co. The Managers vote against
resolutions they consider may damage shareholders’
rights or economic interests and their actions are
reported at Board meetings.
Climate change
The Board recognises that climate change poses a
serious threat to our environment, our society and
to economies and companies around the globe.
Addressing the underlying causes is likely to result
in companies that are high emitters of carbon facing
greater societal and regulatory scrutiny and higher
costs to account for the true environmental impact
of their activities. The Managers’ pursuit of long-term
growth opportunities typically involves investment
in entrepreneurial, disruptive and technology-driven
businesses. These companies are often capital-light
with a low carbon footprint. The Managers believe
that carbon footprint metrics in isolation are
unhelpful – that some firms pollute more than others
is a mostly meaningless observation. An external
provider was engaged to map the carbon footprint
of the portfolio. This analysis shows that the carbon
intensity of Baillie Gifford European Growth Trust
is 34% less than the index (FTSE All-World Europe
ex UK Index) and is based on 80% of the value of
the Company’s portfolio which has either reported
or estimated S12 carbon emissions data and 80%
of the value of the Company’s portfolio which has
estimated S3 carbon emissions data.
Baillie Gifford’s Task Force on Climate-Related
Financial Disclosures (‘TCFD’) Climate Report
isavailable on the Managers’ Website at
bailliegifford.com. A Company specific TCFD climate
report is also available on the Company’s page of the
Managers’ website at bgeuropeangrowth.com. This
report is a means by which the portfolio’s carbon
footprint and exposure to climate risk are measured
and reported. Companies disclosing their emission
and communicating emissions plans will be a helpful
place from which to begin more useful discussions
with management teams, industry experts and
regulators. The Managers, Baillie Gifford & Co, are
signatories to the Carbon Disclosure Project and
are also members of the International Corporate
Governance Network.
On behalf of the Board
David Barron
Chairman
8 December 2025
65
Baillie Gifford European Growth Trust plc
The Audit Committee consists
of all Directors. The members
of the Committee consider that
they have the requisite financial
skills and experience to fulfil the
responsibilities of the Committee.
Andrew Watkins is the Chairman
of the Committee.
Audit
Committee report
The Committee’s authority and duties are clearly
defined within its written Terms of Reference which
are available on request from the Company and
on the Company’s page of the Managers’ website:
bgeuropeangrowth.com. The Terms of Reference
arereviewed annually.
The Committee’s effectiveness is reviewed on an
annual basis as part of the Board’s performance
evaluation process (see page 59).
At least once a year the Committee meets with the
external Auditor without any representative of the
Manager being present.
Main activities of the Commitee
The Committee met four times during the year,
with two of the meetings focussed on the review of
the Company’s private company valuations. Baillie
Gifford attended all meetings. Baillie Gifford &
Co’s Internal Audit and Compliance Departments
and the AIFM’s permanent risk function provided
reports on their monitoring programmes for the two
meetings focussed on governance and the approval
of the financial statements. BDO LLP attended
both of those meetings and held separate meetings
with the Audit Committee Chair in advance of both
Committee meetings. In addition, the external
auditor met with the Audit Committee Chair on an
ad-hoc basis to discuss matters pertinent to the
Committee as they arose.
The matters considered, monitored and reviewed
by the Committee during the course of the year
included the following:
• the results announcement and Annual and Interim
Reports;
• the Company’s accounting policies and practices
and the implementation of the Managers’ valuation
policy for investments in unquoted companies;
Governance report
Annual Report and Financial Statements 2025
66
• the regulatory changes impacting the Company;
• the fairness, balance and understandability of
the Annual Report and Financial Statements and
whether it provided the information necessary
for shareholders to assess the Company’s
performance, business model and strategy;
• the effectiveness of the Company’s internal
control environment;
• the appointment/reappointment, remuneration
and terms of engagement of the external Auditor;
• whether the audit services contract should be put
out to tender;
• the policy on the engagement of the external
Auditor to supply non-audit services;
• the independence and objectivity of the external
Auditor and the effectiveness of the audit process;
• the need for the Company to have its own internal
audit function;
• the internal controls reports and bridging letters
where appropriate received from the Managers
and other service providers including the
Custodian and the Registrar; and
• the arrangements in place within Baillie Gifford
& Co whereby its staff may, in confidence, raise
concerns about possible improprieties in matters
of financial reporting or other matters.
Internal audit
The Committee continues to believe that the
compliance and internal control systems and the
internal audit function in place within the Managers
provide sufficient assurance that a sound system
of internal control, which safeguards shareholders’
investment and the Company’s assets, is maintained.
An internal audit function, specific to the Company,
is therefore considered unnecessary.
The external Auditor has adopted a wholly
substantive approach to testing and therefore the
absence of an internal audit function has not had an
impact on audit procedures.
Financial reporting
The Committee considers that the most significant
issues likely to affect the Financial Statements are
the existence and valuation of investments, as they
represent 99.2% of total assets, and the accuracy
and completeness of income from investments.
The majority of the investments are in quoted
securities and market prices are readily available
from independent external pricing sources. The
Committee reviewed the Managers’ Report on
Internal Controls which details the controls in place
regarding recording and pricing of investments,
accurate recording of investment income and
the reconciliation of investment holdings to third
partydata.
The Managers agreed the prices of all the listed
investments at 30 September
2025
to external price
sources. The Committee reviewed the Managers’
valuation policy for investments in private companies
(as described on pages
86
and
87
) and approved
the valuation of the unlisted investments following a
detailed review of the valuation of the investments
and relevant challenge where appropriate. The listed
portfolio holdings were agreed by the Managers to
confirmations from the Company’s custodian. The
unlisted holdings were agreed by the Managers to
confirmations from the investee companies.
The Committee considered the factors, including
the impact of increasing geopolitical tensions, that
might affect the Company’s viability over a period
of five years and its ability to continue as a going
concern for at least twelve months from the date of
signing of the Financial Statements, together with
the reports from the Managers on the cash position
and cash flow projections of the Company, the
liquidity of the investment portfolio, compliance with
debt covenants, availability of borrowing facilities
and the Company’s ability to meet its obligations
as they fall due. The Committee also reviewed the
Viability Statement on page
31
and the statement
on Going Concern on page
63
including the impact
of increasing geopolitical tensions. Following this
assessment, the Committee recommended to the
Board the appropriateness of the Going Concern
basis in preparing the Financial Statements and
confirmed the accuracy of the Viability Statement
and statement on Going Concern.
The Managers and Auditor confirmed to the
Committee that they were not aware of any material
misstatements in the context of the Financial
Statements as a whole and that the Financial
Statements are in accordance with applicable law
and accounting standards.
67
Baillie Gifford European Growth Trust plc
Internal controls and risk management
The Committee reviewed the effectiveness of
the Company’s risk management and internal
controls systems as described on pages 62 and 63.
Nosignificant weaknesses were identified in the
year under review.
External Auditor
To fulfil its responsibility regarding the independence
and objectivity of the external Auditor, the
Committee reviewed:
• the audit plan for the year to 30 September 2025;
• a report from the Auditor describing its
arrangements to manage auditor independence
and received confirmation of its independence;
and
• the extent of non-audit services provided by the
external Auditor.
To assess the effectiveness of the external Auditor,
the Committee reviewed and considered:
• the Auditor’s fulfilment of the agreed audit plan;
• feedback from the Secretaries on the performance
of the audit team;
• the Audit Quality Inspection Report from the FRC;
and
• detailed discussion with audit personnel to
challenge audit processes and deliverables.
To fulfil its responsibility for oversight of the external
audit process the Committee considered and
reviewed:
• the Auditor’s engagement letter;
• the Auditor’s proposed audit strategy;
• the audit fee; and
• a report from the Auditor on the conclusion of
theaudit.
BDO LLP, has been engaged as the Company’s
Auditor since 2017. The audit partners responsible
for the audit are rotated at least every five years
in accordance with professional and regulatory
standards in order to protect independence and
objectivity and to provide fresh challenge to the
business. Chris Meyrick is the lead audit partner and
has held the role since January 2022.
BDO LLP has confirmed that it believes it is
independent within the meaning of regulatory and
professional requirements and that the objectivity of
the audit partner and staff is not impaired.
Having carried out the review process described
above, the Committee is satisfied that the Auditor
has remained independent and effective.
There are no contractual obligations restricting the
Committee’s choice of external Auditor.
Accountability and audit
The respective responsibilities of the Directors
and the Auditor in connection with the Financial
Statements are set out on pages 72 to 81.
On behalf of the Board
Andrew Watkins
Audit Committee Chairman
8 December 2025
Governance report
Annual Report and Financial Statements 2025
68
Directors’
remuneration report
Statement by the Chairman
The Directors’ Remuneration Policy is subject
toshareholder approval every three years or sooner
ifan alteration to the policy is proposed. The
Remuneration Policy, which is set out below, was
approved at the Annual General Meeting in February
2023 and no changes are proposed to the policy to
be approved at the Annual General Meeting to be
held in 2026. Directors’ fees were last increased on
1October 2023. The Board reviewed the level of fees
during the year and agreed that the Directors fees
would be increased, to £48,000 in relation to the
Chairman, £32,500 in relation to each non-executive
director and an additional payment of £8,000 in
relation to the Chair of the Audit Committee. The fee
increases would be effective from 1 October 2025,
being the start of the Company’s next financial year.
Directors’ remuneration policy
The Company follows the recommendation of
theAIC Code that Directors’ remuneration should
reflect their duties, responsibilities and the value
of their time spent on the Company’s affairs. The
Board’s policy is that the remuneration of the
Directors should reflect the experience of the Board
as a whole and be determined with reference to
comparable organisations and appointments.
The Board has set three levels of fees: one for the
Chairman, one for the other Directors, and an
additional fee that is paid to the Director who
chairsthe Audit Committee. Fees are reviewed
annually in accordance with the policy. The fee for
any new Director appointed will be determined on
the same basis.
Any views expressed by shareholders on the
fees being paid to Directors will be taken into
consideration by the Board when reviewing the
Directors’ Remuneration Policy and in the annual
review of Directors’ fees.
This report has been prepared in
accordance with the requirements
of the Companies Act 2006.
69
Baillie Gifford European Growth Trust plc
The Directors are not eligible for bonuses,
pensionbenefits, share options, long-term incentive
schemes or other benefits, as the Board does not
consider such arrangements or benefits necessary
or appropriate for non-executive Directors.
Under the Articles of Association, Directors are
entitled to be paid for all reasonable travel, hotel
and incidental expenses incurred in or about
the performance of their duties as Directors,
including expenses incurred in attending Board or
shareholdermeetings.
If any Director is called upon to perform extra or
special services of any kind, under the Articles of
Association, they shall be entitled to receive such
extra remuneration as the Board may decide in
addition to any remuneration they may be entitled
toreceive.
The Company does not enter into service contracts
with its Directors. Instead, the Company has a policy
of entering into a letter of appointment with each
of its Directors, copies of which are available on
request from the Company Secretary. It is intended
that the Company’s policy when determining the
duration of notice periods and termination payments
under the Directors’ letters of appointment will
bebased on prevailing best practice guidelines.
Under the Directors’ letters of appointment,
there isa notice period of one month and no
compensation is payable to a Director on leaving
office. No compensation is payable in the event of
atakeover bid.
The terms of their appointment provide that all
Directors shall retire and be subject to election at the
first Annual General Meeting after their appointment.
Thereafter, at each AGM any Director who has not
stood for appointment or re-election at either of
the two preceding AGMs is required to retire and
offer themselves for re-election. Beyond these
requirements, it has been agreed that all Directors
will seek annual re-election at the Company’s AGMs.
Limits on Directors’ remuneration
The fees for the non-executive Directors are
payable monthly in arrears and are determined
within the limit set out in the Company’s Articles of
Association which is currently £200,000 per annum
in aggregate. Any change to this limit requires
shareholder approval.
The fees paid in respect of the year ended
30September 2025 together with the expected fees
payable in respect of the year ending 30 September
2026 are set out in the table below. The fees payable
to the Directors in the subsequent financial years
will be determined following an annual review of the
Directors’ fees.
Expected
fees for
year ending
30 September
2026
£
Fees paid for
the year to
30 September
2025
£
Chairman’s fee 48,000 44,000
Non-executive Director’s fee 32,500 30,000
Additional fee for
the Chairman of the
Audit Committee
8,000 6,000
Total aggregate annual
fees that can be paid
to the Directors in any
year under the Directors’
Remuneration Policy, as
set out in the Company’s
Articles of Association
200,000 200,000
Governance report
Annual Report and Financial Statements 2025
70
Annual report on remuneration
An ordinary resolution for the approval of this report will be put to the members at the forthcoming
AnnualGeneral Meeting.
The law requires the Company’s Auditor to audit certain of the disclosures provided in this report.
Wheredisclosures have been audited, they are indicated as such. The Auditor’s opinion is included
intheIndependent Auditor’s report on pages 75 to 81.
Directors’ remuneration for the year (audited)
The Directors who served during the year received the following remuneration in the form of fees and
taxable benefits. This represents the entire remuneration paid to the Directors.
Name
2025
Fees
£
2025
Taxable
benefits*
£
2025
Total
£
2024
Fees
£
2024
Taxable
benefits*
£
2024
Total
£
David Barron
†
39,217 3,685 42,902 30,000 2,560 32,560
Davina Curling
#
27,500 2,769 30,269 – – –
Emma Davies 30,000 4,079 34,079 30,000 1,912 31,912
Andrew Watkins 36,000 1,465 37,465 34,231 3,099 37,330
Michael MacPhee
‡
15,217 368 15,585 44,000 1,839 45,839
Michael Woodward
¶
– – – 10,938 1,338 12,276
147,934 12,366 160,300 149,169 10,748 159,917
* Comprises expenses incurred by Directors in the course of travel to attend Board and Committee meetings held at the Company’s normal place of
business. These amounts have been grossed up for applicable income tax and national insurance.
†
Appointed as Chairman 5 February 2025.
#
Appointed 1 November 2024.
‡
Retired 5 February 2025.
¶
Retired 18 January 2024.
Annual percentage change in remuneration
This represents the annual percentage change in the entire remuneration paid to the Directors.
Name
% from
2024 to
2025
% from
2023 to
2024
% from
2022 to
2023
% from
2021 to
2022
% from
2020 to
2021
David Barron
*
32 – – – –
Davina Curling
†
– – – – –
Emma Davies
#
7 13 2 37 –
Andrew Watkins
‡
1 31 1 4 20
Michael MacPhee
¶
(66) 11 2 1 20
* Appointed to the Board 1 October 2023 and appointed as Chairman on 5 February 2025.
†
Appointed 1 November 2024.
#
Appointed 1 January 2021.
‡
Appointed 1 January 2019.
¶
Retired 5 February 2025.
71
Baillie Gifford European Growth Trust plc
Company performance
The following graph compares the share price
total return (assuming all dividends are reinvested)
to ordinary shareholders compared with the total
shareholder return on a notional investment made
up of shares in the component parts of the FTSE
Europe ex UK Index. This index was chosen for
comparison purposes as it is a widely used measure
of performance for European listed companies and
also the index against which the Company measures
its performance.
Performance graph
(figures rebased to 100 at 30 September 2015)
Cumulative to 30 September
20252015 2017 2019 2021 2023
● Baillie Gifford European
Growth Trust’s share price
Source: LSEG and relevant underlying index providers. See disclaimer
on page 114.
All figures are total returns (assuming net dividends are reinvested).
See Glossary of terms and alternative performance measures on pages 116
to 118.
● FTSE Europe ex UK Index
(in sterling terms)
0
300
150
100
50
250
200
Past performance is not a guide to future
performance.
Approval
The Directors’ Remuneration Report on pages68
to 71 was approved by the Board of Directors
andsigned on its behalf on 8December 2025.
David Barron
Chairman
Directors’ interests (audited)
The Directors at the end of the year under review,
and their interests in the Company, are shown in the
following table. There is no requirement under the
Company’s Articles of Association for Directors to
hold shares in the Company. There have been no
changes intimated in the Directors’ interests up to
4December 2025.
Name
Nature
of interest
Ordinary 2.5p
shares held at
30 September
2025
Ordinary 2.5p
shares held at
30 September
2024
David Barron Beneficial 20,600 –
Davina Curling* – – –
Emma Davies Beneficial 20,505 20,505
Andrew Watkins Beneficial 25,000 15,000
Michael MacPhee
†
Beneficial – 756,950
* Appointed 1 November 2024.
†
Retired 5 February 2025.
Statement of voting at Annual General Meeting
At the last Annual General Meeting, of the
proxy votes received in respect of the Directors’
Remuneration Report, 99.2% were in favour,
0.5%were against and votes withheld were 0.3%.
At the last Annual General Meeting at which the
Directors’ Remuneration Policy was considered
(February 2023), 99.2% of the proxy votes received
were in favour, 0.6% were against and 0.2% votes
were withheld.
Relative importance of spend on pay
The table below shows the actual expenditure (fees
and taxable benefits) during the year in relation
to Directors’ remuneration and distributions to
shareholders.
2025
£’000
2024
£’000
Change
%
Directors’ remuneration 160 160 –
Dividends 2,338 2,111 11
Share buy backs 26,852 6,001 347
Governance report
Annual Report and Financial Statements 2025
72
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the Company’s transactions and disclose
with reasonable accuracy at any time the financial
position of the Company and enable them to ensure
that the Financial Statements and the Directors’
remuneration report comply with the Companies
Act 2006. They are responsible for such internal
control as they determine is necessary to enable the
preparation of Financial Statements that are free
from material misstatement, whether due to fraud or
error, and are also responsible for safeguarding the
assets of the Company and to prevent and detect
fraud and other irregularities.
Under applicable laws and regulations, the Directors
are also responsible for preparing a Strategic report,
Directors’ report, Directors’ remuneration report and
Corporate governance statement that complies with
those laws and regulations.
In accordance with Disclosure Guidance and
Transparency Rule 4.1.14R, the Financial Statements
will form part of the annual financial report prepared
using the single electronic reporting format under
the TD ESEF Regulation. The Auditor’s report on
these Financial Statements provides no assurance
over the ESEF format.
The Directors are responsible for ensuring that the
Annual Report and 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 page of the Managers’ website
is the responsibility of the Directors. The Directors’
responsibility also extends to the ongoing integrity
of the Financial Statements contained therein.
The Directors have delegated responsibility to the
Managers for the maintenance and integrity of the
Company’s page of the Managers’ website.
The Directors are responsible for preparing
the Annual Report and Financial Statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare
Financial Statements for each financial year.
Underthat law they have elected to prepare the
Financial Statements in accordance with applicable
law and United Kingdom Accounting Standards,
comprising Financial Reporting Standard 102
‘TheFinancial Reporting Standard Applicable in
the UK and Republic of Ireland’ (FRS 102). 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 its profit or loss for that year. In
preparing these Financial Statements, the Directors
are required to:
• select suitable accounting policies and then apply
them consistently;
• state whether applicable United Kingdom
Accounting Standards, comprising FRS 102, have
been followed, subject to any material departures
disclosed and explained in the Financial
Statements;
• make judgements and accounting estimates that
are reasonable and prudent; and
• prepare the Financial Statements on the going
concern basis unless it is inappropriate to presume
that the Company will continue in business.
Statement of Directors’
responsibilities
in respect of the Annual Report and the Financial Statements
73
Baillie Gifford European Growth Trust plc
Responsibility Statement of the Directors
inrespect of the Annual Financial Report
We confirm that, to the best of our knowledge:
• the Financial Statements, prepared in accordance
with the applicable set of accounting standards,
give a true and fair view of the assets, liabilities,
financial position and net return of the Company;
• the Strategic Report includes a fair review of the
development and performance of the business
and the position of the Company, together with a
description of the principal risks and uncertainties
it faces; and
• the Annual Report and Financial Statements,
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.
On behalf of the Board
David Barron
8 December 2025
Financial
report
The Financial Statements for the
year to 30 September 2025 are
set out on pages 82 to 101 and
have been prepared in accordance
with FRS 102 ‘The Financial
Reporting Standard applicable in
the UK and Republic of Ireland’.
75
Baillie Gifford European Growth Trust plc
Independent
auditor’s report
to the members of Baillie Gifford European Growth Trust plc
Basis for opinion
We conducted our audit in accordance with
International Standards on Auditing (UK) (ISAs (UK))
and applicable law. Our responsibilities under those
standards are further described in the Auditor’s
responsibilities for the audit of the Financial
Statements section of our report. We believe that the
audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion. Our
audit opinion is consistent with our reporting to the
audit committee.
Independence
Following the recommendation of the Audit
Committee, we were appointed by the members on
24January 2017 to audit the Financial Statements
for the year ended 30September 2017 and
subsequent financial periods. The period of total
uninterrupted engagement including retenders and
reappointments is 9 years, covering the years ended
30September 2017 to 30September 2025. We
remain independent of the Company in accordance
with the ethical requirements that are relevant to our
audit of the Financial Statements in the UK,
including the FRC’s Ethical Standard as applied to
listed public interest entities, and we have fulfilled
our other ethical responsibilities in accordance with
these requirements. The non-audit services
prohibited by that standard were not provided to
theCompany.
Opinion on the Financial Statements
In our opinion the Financial Statements:
• give a true and fair view of the state of the
Company’s affairs as at 30 September 2025 and
of its profit for the year then ended;
• have been properly prepared in accordance with
United Kingdom Generally Accepted Accounting
Practice; and
• have been prepared in accordance with the
requirements of the Companies Act 2006.
We have audited the Financials Statements of Baillie
Gifford European Growth Trust plc (the ‘Company’)
for the year ended 30 September 2025 which
comprise the Income Statement, the Balance Sheet,
the Statement of Changes in Equity, the Cash Flow
Statement and notes to the Financial Statements,
including a summary of significant accounting
policies. The financial reporting framework that
has been applied in their preparation is applicable
law and United Kingdom Accounting Standards,
including Financial Reporting Standard 102, The
Financial Reporting Standard applicable in the UK
and Republic of Ireland (United Kingdom Generally
Accepted Accounting Practice).
Financial report
Annual Report and Financial Statements 2025
76
Overview
2025 2024
Key audit
matters
Valuation and ownership of listed
and unlisted investments
Materiality Company Financial Statements
asawhole
£3.5m (2024: £3.6m) based on 1%
(2024: 1%) of net assets
An overview of the scope of our audit
Our audit was scoped by obtaining an understanding
of the Company and its environment, including
the Company’s system of internal control, and
assessing the risks of material misstatement in the
Financial Statements. We also addressed the risk of
management override of internal controls, including
assessing whether there was evidence of bias by
the Directors that may have represented a risk of
materialmisstatement.
Key audit matters
Key audit matters are those matters that, in our
professional judgement, were of most significance in
our audit of the Financial Statements of the current
period and include the most significant assessed
risks of material misstatement (whether or not due to
fraud) that we identified, including those which had
the greatest effect on: the overall audit strategy, the
allocation of resources in the audit, and directing the
efforts of the engagement team. These matters were
addressed in the context of our audit of the Financial
Statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion
on these matters.
Conclusions relating to going concern
In auditing the Financial Statements, we have
concluded that the Directors’ use of the going
concern basis of accounting in the preparation of the
Financial Statements is appropriate. Our evaluation
of the Directors’ assessment of the Company’s
ability to continue to adopt the going concern basis
of accounting included:
• Evaluating the appropriateness of the Directors’
method of assessing the going concern in light of
economic and market conditions by reviewing the
information used by the Directors in completing
their assessment;
• Reviewing the loan agreements to identify the
covenants and assessing the likelihood of them
being breached based on the Directors’ forecasts
and our sensitivity analyses;
• Assessment of the availability of cash and the
liquidity of the investment portfolio in relation to
its ability to meet expected cash outflows over at
least the next twelve months; and
• Challenging the appropriateness of the Directors’
assumptions and judgements made with regards to
forecasts, including stress-testing forecasts which
included consideration of the covenant headroom.
Based on the work we have performed, we have
not identified any material uncertainties relating to
events or conditions that, individually or collectively,
may cast significant doubt on the Company’s
ability to continue as a going concern for a period
of at least twelve months from when the Financial
Statements are authorised for issue.
In relation to the Company’s reporting on how it has
applied the UK Corporate Governance Code, we
have nothing material to add or draw attention to in
relation to the Directors’ statement in the Financial
Statements about whether the Directors considered
it appropriate to adopt the going concern basis
ofaccounting.
Our responsibilities and the responsibilities of
the Directors with respect to going concern are
described in the relevant sections of this report.
77
Baillie Gifford European Growth Trust plc
Key audit matter How the scope of our audit addressed the key audit matter
Valuation and
ownership of listed and
unlisted investments
(Note 1 and 9)
We considered the valuation
and ownership of listed and
unlisted investments to be
the most important audit area
as investments represent the
most significant balance in
the Financial Statements and
underpin the principal activity
of the Company.
The investment portfolio at
the year-end comprised of
listed and unlisted equity
investments.
There is a risk that the
prices used for the listed
investments held by the
Company are not reflective of
fair value. We do not consider
the use of bid price as a
proxy for fair value of listed
investments to be subject
to significant estimation
uncertainty.
Significant judgment is
required in determining the
valuation methodology for
unlisted investments, and
their valuations are subject to
estimation uncertainty.
There is also a risk of error in
the recording of investment
holdings such that those
records do not appropriately
reflect the property of the
Company.
For these reasons and the
materiality to the Financial
Statements as a whole, the
valuation and ownership
of listed and unlisted
investments are considered
to be a key area of our overall
audit strategy and allocation
of our resources and hence a
Key Audit Matter.
We responded to this matter by testing the valuation and ownership of the
whole portfolio of listed and unlisted investments.
In relation to the listed investments, we performed the following procedures:
• Confirmed the year-end bid price was used by agreeing to externally
quoted prices;
• Assessed if there were contra indicators, such as liquidity considerations,
to suggest bid price is not the most appropriate indication of fair value by
considering the realisation period for individual holdings;
• Recalculated the valuation by multiplying the number of shares held per
the statement obtained from the custodian by the share price;
• Obtained direct confirmation of the number of shares held per equity
investment from the custodian regarding all investments held at the
balance sheet date; and
• Agreed the exchange rates used to independent sources.
In relation to the unlisted investments, we performed the following
procedures:
• Assessed the design and implementation of controls over the unlisted
investment valuations;
• Considered the appropriateness of the valuation methodology applied
by the AIFM under the International Private Equity and Venture Capital
Valuation IPEV’) Guidelines and applicable accounting standards;
• Reviewed the valuations prepared by Baillie Gifford & Co (‘the Manager’)
and challenged and corroborated the inputs to the valuation with
reference to management information on investee companies, market
data and our own understanding of the investee companies and assessed
the impact of the estimation uncertainty concerning these assumptions;
• Verified the exchange rates used to independent sources; and
• Agreed the holdings either to independently received third-party
confirmation from the custodian or confirmation from the underlying
investee companies, to confirm ownership.
For unlisted investments that were valued using calibrated price of recent
investment reviewed for changes, we performed the following:
• Verified the price of recent investment transaction to supporting
documentation;
• Considered whether the investment transaction was an arm’s length
transaction through reviewing the parties involved in the transaction
and checking whether or not they were already investors in the investee
company.
• Considered whether there were any indications that the price of recent
investment transaction was no longer representative of fair value
considering, inter alia, the current performance of the investee company
and the milestones and assumptions set out in the investment proposal;
and
• Considered whether the price of recent investment transaction is
supported by alternative valuation techniques as well as the time lapsed/
calibration since the investment round.
Financial report
Annual Report and Financial Statements 2025
78
Key audit matter How the scope of our audit addressed the key audit matter
For unlisted investments that were valued using a market approach
(multiples, industry valuation benchmarks and available market prices), we
performed the following:
• Challenged and corroborated the inputs to the valuation with reference
to management information of investee companies, market data and our
own understanding;
• Reviewed the historical Financial Statements and any recent management
information available to support assumptions about maintainable
revenues, earnings or cash flows used in the valuations;
• Considered the multiples applied and the discounts applied by reference
to observable quoted company market data;
• Challenged the consistency and appropriateness of adjustments made
to such market data in establishing the revenue, cash flow or earnings
multiple applied in arriving at the valuations adopted by considering the
individual performance of investee companies against plan and relative
to the peer group, the market and sector in which the investee company
operates and other factors as appropriate;
• For investments being valued using the benchmarking method, we have
considered the appropriateness of the benchmark index applied;
• For investments being valued using the benchmarking method, we have
also considered the consistency of the benchmark being applied; and
• Where an insolvency risk discount has been applied, we have considered the
reasonability of the discount for the applicable investment.
Where appropriate, we performed stress and reverse stress tests to determine
materiality of possible movements in selected inputs. We have also performed
scenario analysis, by developing our own point estimates and evaluating
acceptable ranges of valuations, where we considered that alternative input
assumptions could reasonably have been applied. We have considered the
overall impact of such scenarios on the portfolio of investments in determining
whether the valuations, as a whole, arereasonable.
Key observations:
Based on our procedures performed we did not identify any matters
to suggest the valuation or ownership of the listed and unlisted equity
investments was not appropriate.
Our application of materiality
We apply the concept of materiality both in planning
and performing our audit, and in evaluating the
effect of misstatements. We consider materiality to
be the magnitude by which misstatements, including
omissions, could influence the economic decisions
of reasonable users that are taken on the basis of the
Financial Statements.
In order to reduce to an appropriately low level
the probability that any misstatements exceed
materiality, we use a lower materiality level,
performance materiality, to determine the extent of
testing needed. Importantly, misstatements below
these levels will not necessarily be evaluated as
immaterial as we also take account of the nature
of identified misstatements, and the particular
circumstances of their occurrence, when evaluating
their effect on the Financial Statements as a whole.
Based on our professional judgement, we determined
materiality for the Financial Statements as a whole
and performance materiality as follows:
Company Financial Statements
2025 2024
Materiality £3.5 million £3.6 million
Basis for determining
materiality
1% of Net assets 1% of Net assets
Rationale for the
benchmark applied
As an investment trust, the net asset
value is the key measure of performance
for users of the Financial Statements
and reflects the fact that debt is present
in the Company.
Performance
materiality
£2.6 million £2.7 million
Basis for
determining
performance
materiality
75% of
materiality
75% of
materiality
Rationale for the
percentage applied
for performance
materiality
The level of performance materiality
applied was set after having considered
a number of factors including the
expected total value of known and
likely misstatements and the level of
transactions in the year.
79
Baillie Gifford European Growth Trust plc
Going
concern and
longer-term
viability
• The Directors’ statement with regards to the
appropriateness of adopting the going concern
basis of accounting and any material uncertainties
identified set out on page 63; and
• The Directors’ explanation as to their assessment
of the Company’s prospects, the period this
assessment covers and why the period is
appropriate set out on page 31.
Other Code
provisions
• Directors’ statement on fair, balanced and
understandable set out on page 73;
• Board’s confirmation that it has carried out a
robust assessment of the emerging and principal
risks set out on pages 32 to 36;
• The section of the annual report that describes
the review of effectiveness of risk management
and internal control systems set out on pages 62
and 63; and
• The section describing the work of the Audit
Committee set out on pages 65 and 66.
Other Companies Act 2006 reporting
Based on the responsibilities described below and
our work performed during the course of the audit,
we are required by the Companies Act 2006 and
ISAs (UK) to report on certain opinions and matters
as described below.
Strategic
report and
Directors’
report
In our opinion, based on the work undertaken in the
course of the audit:
• the information given in the Strategic report and
the Directors’ report for the financial year for
which the Financial Statements are prepared is
consistent with the Financial Statements; and
• the Strategic report and the Directors’ report have
been prepared in accordance with applicable legal
requirements.
In the light of the knowledge and understanding of
the Company and its environment obtained in the
course of the audit, we have not identified material
misstatements in the strategic report or the Directors’
report.
Directors’
remuneration
In our opinion, the part of the Directors’ remuneration
report to be audited has been properly prepared in
accordance with the Companies Act 2006.
Matters on
which we
are required
to report by
exception
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
• adequate accounting records have not been kept,
or returns adequate for our audit have not been
received from branches not visited by us; or
• the Financial Statements and the part of the
Directors’ remuneration report to be audited are
not in agreement with the accounting records and
returns; or
• certain disclosures of Directors’ remuneration
specified by law are not made; or
• we have not received all the information and
explanations we require for our audit.
Reporting threshold
We agreed with the Audit Committee that we would
report to them all individual audit differences in
excess of £170,000 (2024: £180,000). We also
agreed to report differences below this threshold
that, in our view, warranted reporting on qualitative
grounds.
Other information
The Directors are responsible for the other
information. The other information comprises the
information included in the Annual report other than
the Financial Statements and our Auditor’s report
thereon. Our opinion on the Financial Statements
does not cover the other information and, except to
the extent otherwise explicitly stated in our report,
we do not express any form of assurance conclusion
thereon. Our responsibility is to read the other
information and, in doing so, consider whether the
other information is materially inconsistent with the
Financial Statements or our knowledge obtained
in the course of the audit, or otherwise appears to
be materially misstated. If we identify such material
inconsistencies or apparent material misstatements,
we are required to determine whether this gives
rise to a material misstatement in the Financial
Statements themselves. If, based on the work we
have performed, we conclude that there is a material
misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Corporate governance statement
The UK Listing Rules require us to review the
Directors’ statement in relation to going concern,
longer-term viability and that part of the Corporate
Governance Statement relating to the Company’s
compliance with the provisions of the UK Corporate
Governance Code specified for our review.
Based on the work undertaken as part of our audit,
we have concluded that each of the following
elements of the Corporate Governance Statement is
materially consistent with the Financial Statements
or our knowledge obtained during the audit.
Financial report
Annual Report and Financial Statements 2025
80
Responsibilities of Directors
As explained more fully in the Statement of Directors’
Responsibilities, the Directors are responsible for
the preparation of the Financial Statements and for
being satisfied that they give a true and fair view, and
for such internal control as the Directors determine
is necessary to enable the preparation of Financial
Statements that are free from material misstatement,
whether due to fraud or error.
In preparing the Financial Statements, the Directors
are responsible for assessing the Company’s
ability to continue as a going concern, disclosing,
as applicable, matters related to going concern
and using the going concern basis of accounting
unless the Directors either intend to liquidate the
Company or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the
Financial Statements
Our objectives are to obtain reasonable assurance
about whether the Financial Statements as a whole
are free from material misstatement, whether due to
fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK)
will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the
aggregate, they could reasonably be expected to
influence the economic decisions of users taken on
the basis of these Financial Statements.
Extent to which the audit was capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of
non-compliance with laws and regulations. We
design procedures in line with our responsibilities,
outlined above, to detect material misstatements in
respect of irregularities, including fraud. The extent
to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
Non-compliance with laws and regulations
Based on:
• Our understanding of the Company and the
industry in which it operates;
• Discussion with the Investment Manager and those
charged with Governance (including the Audit
Committee); and
• Obtaining and understanding of the Company’s
policies and procedures regarding compliance
with laws and regulations
we considered the significant laws and regulations
to be Companies Act 2006, the FCA listing and DTR
rules, the principles of the AIC Code of Corporate
Governance, industry practice represented by the
AIC SORP, the applicable accounting framework,
and qualification as an Investment Trust under UK
tax legislation as any non-compliance of this would
lead to the Company losing various deductions and
exemptions from corporation tax.
Our procedures in respect of the above included:
• Agreement of the financial statement disclosures
to underlying supporting documentation;
• Enquiries of the Investment Manager and those
charged with Governance relating to the existence
of any non-compliance with laws and regulations;
• Reviewing minutes of meeting of those charged
with Governance throughout the period for
instances of non-compliance with laws and
regulations; and
• Reviewing the calculation in relation to Investment
Trust compliance to check that the Company was
meeting its requirements to retain their Investment
Trust Status.
Fraud
We assessed the susceptibility of the Financial
Statements to material misstatement including
fraud.
Our risk assessment procedures included:
• Enquiry with the Investment Manager and those
charged with Governance (including the Audit
Committee) regarding any known or suspected
instances of fraud;
• Obtaining an understanding of the Company’s
policies and procedures relating to:
– Detecting and responding to the risks of fraud;
and
– Internal controls established to mitigate risks
related to fraud.
• Review of minutes of meetings of those charged
with Governance for any known or suspected
instances of fraud; and
• Discussion amongst the engagement team as to
how and where fraud might occur in the Financial
Statements.
Based on our risk assessment, we considered
the areas most susceptible to be the valuation of
unlisted investments and management override
ofcontrols.
81
Baillie Gifford European Growth Trust plc
Our procedures in respect of the above included:
• In addressing the risk of the valuation of unlisted
investments, the procedures set out in the Key
Audit Matters section above;
• In addressing the risk of management override of
controls, we performed the following:
– Performed a review of estimates and
judgements applied by the Investment Manager
in the Financial Statements to assess their
appropriateness and the existence of any
systematic bias;
– Considered the opportunity and incentive to
manipulate accounting entries and target tested
relevant adjustments made in the period end
financial reporting process;
– Reviewed for significant transactions outside the
normal course of business; and
– Performed a review of unadjusted differences,
if any, for indications of bias or deliberate
misstatement.
We also communicated relevant identified laws
and regulations and potential fraud risks to all
engagement team members who were all deemed to
have appropriate competence and capabilities and
remained alert to any indications of fraud or non-
compliance with laws and regulations throughout
theaudit.
Our audit procedures were designed to respond
to risks of material misstatement in the Financial
Statements, recognising that the risk of not
detecting a material misstatement due to
fraud is higher than the risk of not detecting
one resulting from error, as fraud may involve
deliberate concealment by, for example, forgery,
misrepresentations or through collusion. There
are inherent limitations in the audit procedures
performed and the further removed non-compliance
with laws and regulations is from the events and
transactions reflected in the Financial Statements,
the less likely we are to become aware of it.
A further description of our responsibilities is
available on the Financial Reporting Council’s
website at: www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor’s report.
Use of our report
This report is made solely to the Company’s
members, as a body, in accordance with Chapter
3 of Part 16 of the Companies Act 2006. Our audit
work has been undertaken so that we might state
to the Company’s members those matters we are
required to state to them in an auditor’s report and
for no other purpose. To the fullest extent permitted
by law, we do not accept or assume responsibility to
anyone other than the Company and the Company’s
members as a body, for our audit work, for this
report, or for the opinions we have formed.
Chris Meyrick (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
London, UK
8 December 2025
BDO LLP is a limited liability partnership registered
in England and Wales (with registered number
OC305127).
Financial report
Annual Report and Financial Statements 2025
82
For the year ended 30 September
Notes
2025
Revenue
£’000
2025
Capital
£’000
2025
Total
£’000
2024
Revenue
£’000
2024
Capital
£’000
2024
Total
£’000
Gains on investments 9 – 18,082 18,082 – 43,968 43,968
Currency gains/(losses) 14 46 (2,251) (2,205) (51) 2,073 2,022
Income 2 4,063 – 4,063 4,013 – 4,013
Investment management fee 3 (355) (1,421) (1,776) (370) (1,477) (1,847)
Other administrative expenses 4 (626) – (626) (630) – (630)
Net return before finance costs
and taxation
3,128 14,410 17,538 2,962 44,564 47,526
Finance costs of borrowings 5 (161) (643) (804) (160) (640) (800)
Net return before taxation 2,967 13,767 16,734 2,802 43,924 46,726
Tax on ordinary activities
6
(305) – (305) (255) – (255)
Net return after taxation 2,662 13,767 16,429 2,547 43,924 46,471
Net return per ordinary share 7 0.78p 4.03p 4.81p 0.72p 12.35p 13.07p
The total column of this statement is the profit and loss account of the Company. The supplementary revenue and capital return columns are prepared
under guidance published by the Association of Investment Companies.
All revenue and capital items in this statement derive from continuing operations.
A Statement of Comprehensive Income is not required as all gains and losses of the Company have been reflected in the above statement.
The accompanying notes on pages 86 to 101 are an integral part of the Financial Statements.
Income
statement
83
Baillie Gifford European Growth Trust plc
As at 30 September As at 30 September
Notes
2025
£’000
2025
£’000
2024
£’000
2024
£’000
Fixed assets
Investments held at fair value through profit or loss 9 403,155 413,975
Current assets
Debtors 10 3,545 1,331
Cash at bank 19 2,807 1,856
6,352 3,187
Creditors
Amounts falling due within one year 11 (3,300) (887)
Net current assets 3,052 2,300
Total assets less current liabilities 406,207 416,275
Creditors
Amounts falling due after more than one year 12 (52,291) (49,844)
Net assets 353,916 366,431
Capital and reserves
Share capital 13 10,061 10,061
Share premium account 14 125,050 125,050
Capital redemption reserve 14 8,750 8,750
Capital reserve 14 201,053 214,138
Revenue reserve 14 9,002 8,432
Shareholders’ funds 353,916 366,431
Net asset value per ordinary share* (borrowings at book value) 15 109.0p 104.2p
Net asset value per ordinary share* (borrowings at fair value) 113.3p 108.0p
The Financial Statements of Baillie Gifford European Growth Trust plc (Company registration number
1055384) were approved and authorised for issue by the Board and were signed on 8 December 2025.
David Barron
Chairman
The accompanying notes on pages 86 to 101 are an integral part of the Financial Statements.
* See Glossary of terms and alternative performance measures on pages 116 to 118.
Balance
sheet
Financial report
Annual Report and Financial Statements 2025
84
For the year ended 30 September 2025
Notes
Share
capital
£’000
Share
premium
account
£’000
Capital
redemption
reserve
£’000
Capital
reserve
£’000
Revenue
reserve
£’000
Shareholders’
funds
£’000
Shareholders’ funds at 1 October 2024 10,061 125,050 8,750 214,138 8,432 366,431
Dividends paid during the year 8 – – – – (2,092) (2,092)
Shares bought back into treasury 13 – – – (26,852) – (26,852)
Net return aftertaxation 14 – – – 13,767 2,662 16,429
Shareholders’ funds at
30 September 2025
10,061 125,050 8,750 201,053 9,002 353,916
For the year ended 30 September 2024
Notes
Share
capital
£’000
Share
premium
account
£’000
Capital
redemption
reserve
£’000
Capital
reserve
£’000
Revenue
reserve
£’000
Shareholders’
funds
£’000
Shareholders’ funds at 1 October 2023 10,061 125,050 8,750 176,215 7,314 327,390
Dividends paid during the year 8 – – – – (1,429) (1,429)
Shares bought back into treasury 13 – – – (6,001) – (6,001)
Net return aftertaxation 14 – – – 43,924 2,547 46,471
Shareholders’ funds at
30 September 2024
10,061 125,050 8,750 214,138 8,432 366,431
The accompanying notes on pages 86 to 101 are an integral part of the Financial Statements.
Statement of
changes in equity
85
Baillie Gifford European Growth Trust plc
* Change in debtors is made up of changes in accrued income, prepaid expenses and taxation recoverable (excluding overseas withholding tax received
in the year) – see note 10. Change in creditors is made up of changes in other creditors and accruals – see note 11.
†
Cash from operations includes dividends received of £3,925,000 (2024 – £3,760,000) and interest received of £22,000 (2024 – £75,000).
#
Acquisitions of investments is made up of the current year purchases at cost (see note 9), plus opening purchases for subsequent settlement,
less closing purchases for subsequent settlement (see note 11). Disposals of investments is made up of the current year sales proceeds (see note 9),
plus opening investment sales awaiting settlement, less closing investment sales awaiting settlement (see note 10).
The accompanying notes on pages 86 to 101 are an integral part of the Financial Statements.
For the year ended 30 September
Notes
2025
£’000
2025
£’000
2024
£’000
2024
£’000
Cash flows from operating activities
Net return before taxation 16,734 46,726
Adjustments to reconcile company profit before tax to net cash
flow from operating activities
Net gains on investments (18,082) (43,968)
Currency losses/(gains) 2,251 (2,073)
Finance costs of borrowings 804 800
Other capital movements
Changes in debtors
*
(318) (149)
Changes in creditors
*
– 73
Taxation
Overseas withholding tax suffered (305) (255)
Overseas withholding tax reclaims received 268 240
Cash from operations
†
1,352 1,394
Interest paid (788) (804)
Net cash inflow from operating activities 564 590
Cash flows from investing activities
Acquisitions of investments
#
(95,425) (82,256)
Disposals of investments
#
124,261 90,091
Net cash inflow from investing activities 28,836 7,835
Cash flows from financing activities
Shares bought back into treasury (26,548) (5,998)
Equity dividends paid (2,092) (1,429)
Net cash outflow from financing activities (28,640) (7,427)
Increase in cash at bank 760 998
Exchange movements 191 (49)
Cash at bank at start of period 1,856 907
Cash at bank at end of period 2,807 1,856
Cash flow
statement
Financial report
Annual Report and Financial Statements 2025
86
01 Principal accounting policies
The Financial Statements for the year to 30 September2025
have been prepared in accordance with FRS 102 ‘The
Financial Reporting Standard applicable in the UK and
Republic of Ireland’ on the basis of the accounting policies
setout below which are consistent with those applied for
theyear ended 30 September 2024.
a. Basis of accounting
All of the Company’s operations are of a continuing
nature and the Financial Statements are prepared
on a going concern basis under the historical cost
convention, modified to include the revaluation of
fixed asset investments and on the assumption that
approval as an investment trust under section 1158
of the Corporation Tax Act 2010 and the Investment
Trust (Approved Company) (Tax) Regulations 2011 will
be retained. The Board has, in particular, considered
the impact of heightened market volatility due to
macroeconomic and geopolitical concerns, but does
not believe the Company’s going concern status is
affected. The Company’s assets, which at present
are mainly investments in quoted securities which are
readily realisable, exceed its liabilities significantly.
All borrowings require the prior approval of the
Board. Gearing levels and compliance with borrowing
covenants are reviewed by the Board on a regular
basis. The Company has continued to comply with the
investment trust status requirements of section 1158 of
the Corporation Tax Act 2010 and the Investment Trust
(Approved Company) (Tax) Regulations 2011.
The Company’s primary third party suppliers, including
its Managers and Secretaries, Custodian, Depositary,
Registrar, Auditor and Corporate Broker, are not
experiencing significant operational difficulties affecting
their respective services to the Company. Accordingly,
the Financial Statements have been prepared on the
going concern basis as it is the Directors’ opinion, having
assessed the principal and emerging risks and other
matters as set out in the Viability Statement on page 31,
that the Company will continue in operational existence
for a period of at least 12 months from the date of
approval of these Financial Statements.
The Financial Statements have been prepared in
accordance with the Companies Act 2006, applicable
UK Accounting Standards and with the AIC’s Statement
of Recommended Practice ‘Financial Statements of
Investment Trust Companies and Venture Capital Trusts’
issued in November 2014 and updated in July 2022.
In order to reflect better the activities of the Company
and in accordance with guidance issued by the AIC,
supplementary information which analyses the Income
statement between items of a revenue and capital nature
has been presented.
Financial assets and financial liabilities are recognised
inthe Company’s Balance sheet when it becomes aparty
to the contractual provisions of the instrument.
The Directors consider the Company’s functional
currency to be sterling as the entity is listed on a sterling
stock exchange in the UK, the Company’s share capital
and dividends paid are denominated in sterling, the
Company’s shareholders are predominantly based in the
UK and the Company and its Investment Manager, which
are subject to the UK’s regulatory environment, are also
UK based.
b. Significant accounting estimates and judgements
The preparation of the Financial Statements requires
the use of estimates, assumptions and judgements.
These estimates, assumptions and judgements
affect thereported amounts of assets and liabilities,
at the reporting date. While estimates are based on
best judgement using information and financial data
available,the actual outcome may differ from these
estimates. The key sources of estimation and uncertainty
relate to the assumptions used in the determination of the
fair value of the unlisted investments, which are detailed
in note 9 on page 91.
Judgements
The Directors consider that the preparation of
theFinancial Statements involves the following
keyjudgements:
i. the determination of the functional currency of the
Company as sterling (see rationale in 1(a) above); and
ii. the fair valuation of the unlisted investments.
The key judgements in the fair valuation process are:
i. the Managers’ determination of the appropriate
application of the International Private Equity and
Venture Capital Guidelines 2022 (IPEV Guidelines)
toeach unlisted investment; and
ii. the Directors’ consideration of whether each fair
value is appropriate following detailed review and
challenge. The judgement applied in the selection of
the methodology used for determining the fair value of
each unlisted investment can have a significant impact
upon the valuation.
Notes to the
Financial Statements
87
Baillie Gifford European Growth Trust plc
Estimates
The key estimate in the Financial Statements is the
determination of the fair value of the unlisted investments
by the Managers for consideration by the Directors. This
estimate is key as it significantly impacts the valuation of
the unlisted investments at the Balance Sheet date. The
fair valuation process involves estimation using subjective
inputs that are unobservable (for which market data is
unavailable). The main estimates involved in the selection
of the valuation process inputs are:
i. the selection of appropriate comparable companies
in order to derive revenue multiples and meaningful
relationships between enterprise value, revenue and
earnings growth. Comparable companies are chosen
onthe basis of their business characteristics and
growth patterns;
ii. the selection of a revenue metric (either historic
orforecast);
iii. the application of an appropriate discount factor
toreflect the reduced liquidity of unlisted companies
versus their listed peers;
iv. the estimation of the probability assigned to an
exitbeing through an initial public offering (‘IPO’)
oracompany sale;
v. the selection of an appropriate industry benchmark
index to assist with the valuation validation or the
application of valuation adjustments, particularly in the
absence of established earnings or closely comparable
peers; and
vi. the calculation of valuation adjustments derived from
milestone analysis (i.e. incorporating operational
success against the plan/forecasts of the business
intothe valuation), or to capture the risk of insolvency
events at a specific company.
c. Investments
The Company’s investments are classified as held at fair
value through profit and loss in accordance with sections
11 and 12 of FRS 102. Purchases and sales of investments
are recognised on a trade date basis. Expenses incidental
to the purchase and sale of investments are recognised
inthe Income Statement as capital items.
Investments are designated as held at fair value through
profit or loss on initial recognition and are measured at
subsequent reporting dates at fair value. The fair value
of listed security investments is bid price or last traded
price. Unlisted investments are valued at fair value by
the Directors following a detailed review and appropriate
challenge of the valuations proposed by the Managers.
The Managers’ unlisted investment policy applies
methodologies consistent with IPEV Guidelines. These
methodologies can be categorised as follows (a) market
approach (multiples, industry valuation benchmarks and
available market prices); (b) income approach (discounted
cash flows); and (c) replacement cost approach (net
assets). The valuation process recognises also, as
stated in the IPEV Guidelines, that the price of a recent
investment may be an appropriate starting point for
estimating fair value, however it should be evaluated
usingthe techniques described above.
d. Cash at bank
Cash at bank include cash in hand and deposits
repayable on demand. Deposits are repayable on demand
if they can be withdrawn at any time without notice and
without penalty or if they have a maturity orperiod of
notice of not more than one working day.
e. Income
i. Income from equity investments is brought into
account on the date on which the investments are
quoted ex-dividend or, where no ex-dividend date is
quoted, when the Company’s right to receive payment
is established.
ii. Special dividends are treated as repayments of capital
or income depending on the facts of each particular
case.
iii. Interest receivable/payable on bank deposits
isrecognised on an accruals basis.
iv. Overseas dividends include the taxes deducted
atsource.
v. If scrip is taken in lieu of dividends in cash, the net
amount of the cash dividend declared is credited to
the revenue account. Any excess in the value of the
shares received over the amount of the cash dividend
foregone is recognised as capital.
vi. Interest from fixed interest securities is recognised
onan effective yield basis.
f. Expenses
All expenses are accounted for on an accruals basis.
Expenses are charged through the revenue account
except:
i. where they relate directly to the acquisition or disposal
of an investment in which case they are recognised
as capital within losses/gains on investments. These
expenses are commonly referred to as transaction costs
and comprise brokerage commission and stamp duty.
Financial report
Annual Report and Financial Statements 2025
88
ii. where they relate directly to the buy-back/issuance of
shares, in which case they are added to the buy-back
cost or deducted from the share issuance proceeds.
The management fee is allocated 20% to revenue and
80% to capital in line with the Board’s expected long-
term split of revenue and capital return from the
Company’s investment portfolio. The Board reviews the
expense allocation policy on a yearly basis and considers
whether it remains appropriate.
g. Long term borrowings, overdrafts and finance costs
Unsecured loan notes and overdrafts are classified as
loans and are measured at amortised cost. They are
initially recorded at the par value of proceeds received
net of direct costs. Finance costs are accounted for on
an accruals basis and on an effective interest basis and
are allocated 20% to revenue and 80% to capital in
line with the Board’s expected long-term split of revenue
and capital return from the Company’s investment
portfolio. The Board reviews the expense allocation
policy on a yearly basis and considers whether it remains
appropriate.
h. Taxation
The taxation charge represents the sum of current
tax and the movement in the provision for deferred
taxation during the year. Current taxation represents
non-recoverable overseas taxes which is charged to the
revenue account where it relates to income received and
to capital where it relates to items of a capital nature.
Deferred taxation is provided on all timing differences
which have originated but not reversed by the Balance
Sheet date, calculated on a non-discounted basis at the
tax rates expected to apply when the timing differences
reverse, based on what has been enacted or substantively
enacted, relevant to the benefit or liability. Deferred tax
assets are recognised only to the extent that it is more
likely than not that there will be taxable profits from which
underlying timing differences can be deducted.
i. Dividend distributions
Final dividends are recognised in the year in which the
dividends are approved by the Company’s shareholders
ina General Meeting. Interim dividends are recognised in
the year in which they are paid.
j. Foreign currencies
Transactions involving foreign currencies are converted
at the rate ruling at the time of the transaction. Monetary
assets and liabilities and fixed asset investment in foreign
currencies are translated at the closing rates of exchange
at the Balance Sheet date. Any gain or loss arising from
a change in exchange rate subsequent to the date of the
transaction is included as an exchange gain or loss in the
Income Statement as capital or revenue as appropriate to
the transaction.
k. Capital reserve
Gains and losses on disposal of investments, changes in
the fair value of investments held, exchange differences
of a capital nature and the amount by which other assets
and liabilities valued at fair value differ from their book
cost are dealt with in the capital reserve. Purchases of
theCompany’s own shares are also funded from this
reserve. The nominal value of such shares is transferred
from share capital to the capital redemption reserve ifthe
shares are subsequently cancelled. 80% of management
fees and finance costs have been allocated to the capital
reserve. The capital reserve, to the extent it constitutes
realised profits, is distributable.
l. Share premium
The share premium reserve represents the excess of the
issue price over the nominal value of shares issued less
transaction costs incurred on the issue of the shares.
m. Capital redemption reserve
The nominal value of ordinary share capital purchased
and cancelled is transferred out of called-up share capital
and into the capital redemption reserve on the relevant
trade date.
n. Revenue reserve
The revenue profit or loss for the year is taken to or from
this reserve. The revenue reserve may be distributed by
way of a dividend.
o. Single segment reporting
The Company is engaged in a single segment of business,
being investment, consequently no business segmental
analysis is provided.
89
Baillie Gifford European Growth Trust plc
02 Income
2025
£’000
2024
£’000
Income from investments
Overseas dividends 4,018 3,818
Overseas interest 23 120
Other income
Interest 22 75
Total income 4,063 4,013
03 Investment management fee
2025
Revenue
£’000
2025
Capital
£’000
2025
Total
£’000
2024
Revenue
£’000
2024
Capital
£’000
2024
Total
£’000
Investment management fee 355 1,421 1,776 370 1,477 1,847
Details of the Investment Management Agreement are disclosed on pages 53 and 54. Baillie Gifford & Co Limited’s annual
management fee is 0.55% of the lower of (i) the Company’s market capitalisation and (ii) the Company’s net asset value (which
shall include income), in either case up to £500 million, and 0.50% of the amount of the lower of the Company’s market
capitalisation or net asset value above £500 million, calculated and payable quarterly.
04 Other administrative expenses
2025
£’000
2024
£’000
General administrative expenses 168 188
Directors’ fees (see Directors’ remuneration report on page 70) 148 149
Marketing* 100 95
Custody 92 77
Auditor’s remuneration – statutory audit of Company’s Annual Financial Statements 57
54
Depositary
37 38
Registrars 24 29
626 630
* The Company is part of a marketing programme which includes all the Investment Trusts managed by the Manager. The
marketing strategy has an ongoing objective to stimulate demand for the Company’s shares. The cost of this marketing strategy
is borne in partnership by the Company and the Manager. The Manager matches the Company’s marketing contribution and
provides the resource to manage and run the programme.
05 Finance costs
2025
Revenue
£’000
2025
Capital
£’000
2025
Total
£’000
2024
Revenue
£’000
2024
Capital
£’000
2024
Total
£’000
Overdraft arrangement fee 1 2 3 1 2 3
Loan notes interest 160 641 801 159 638 797
161 643 804 160 640 800
Financial report
Annual Report and Financial Statements 2025
90
06 Tax on ordinary activities
2025
Total
£’000
2024
Total
£’000
Analysis of charge in year
Overseas taxation 305 255
Tax charge 305 255
2025
£’000
2024
£’000
Factors affecting tax charge for year
The tax charge for the year is lower than the standard rate of corporation tax in the UK of 25%.
The differences are explained below:
Net revenue return before taxation 2,967 2,802
Net revenue return multiplied by the standard rate of corporation tax in the UK of 25%
(2024 – 25%)
742 701
Effects of:
Income not taxable (1,016) (942)
Overseas tax charge 305 255
Taxable losses in year not utilised 274 241
Revenue tax charge for the year 305 255
As an investment trust, the Company’s capital gains are not taxable.
Factors that may affect future tax charges
At 30 September 2025 the Company had unrelieved losses carried forward of £33,277,000 (2024 – £30,114,000) and had a
potential deferred tax asset of £8,319,000 (2024 – £7,529,000) on taxable losses which is available to be carried forward and
offset against future taxable profits. A deferred tax asset has not been recognised on these losses as it is considered unlikely that
the Company will make taxable revenue profits in the future and it is not liable to tax on its capital gains. The potential deferred
tax asset has been calculated using a corporation tax rate of 25% (2024 – 25%).
Due to the Company’s status as an investment trust, and the intention to continue meeting the conditions required to obtain
approval in the foreseeable future, the Company has not provided for deferred tax on any capital gains and losses arising
ontherevaluation or disposal of investments.
07 Net return per ordinary share
2025
Revenue
2025
Capital
2025
Total
2024
Revenue
2024
Capital
2024
Total
Net return per ordinary share 0.78p 4.03p 4.81p 0.72p 12.35p 13.07p
Revenue return per ordinary share is based on the net revenue return after taxation of £2,662,000 (2024 – £2,547,000), and on
341,427,285 (2024 – 355,716,719) ordinary shares, being the weighted average number of ordinary shares in issue during each year.
Capital return per ordinary share is based on the net capital gain for the financial year of £13,767,000 (2024 – £43,924,000), and
on 341,427,285 (2024 – 355,716,719) ordinary shares, being the weighted average number of ordinary shares in issue during
each year.
There are no dilutive or potentially dilutive shares in issue.
91
Baillie Gifford European Growth Trust plc
08 Ordinary dividends
2025 2024 2025
£’000
2024
£’000
Amounts recognised as distributions in the period:
Previous year’s final (paid 14 February 2025) 0.60p 0.40p 2,092 1,429
Also 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 section 1158 of the Corporation Tax Act 2010 are considered. The revenue available for distribution by way of
dividend for the year is £2,662,000 (2024 – £2,547,000).
2025 2024 2025
£’000
2024
£’000
Dividends paid and proposed in the period:
Proposed final dividend per ordinary share (payable13 February 2026) 0.72p 0.6p 2,338 2,111
09 Investments
As at 30 September 2025
Level 1
£’000
Level 2
£’000
Level 3
£’000
Total
£’000
Securities
Listed equities 348,295 – – 348,295
Unlisted equities – – 54,860 54,860
Total financial asset investments 348,295 – 54,860 403,155
As at 30 September 2024
Level 1
£’000
Level 2
£’000
Level 3
£’000
Total
£’000
Securities
Listed equities 390,500 – – 390,500
Unlisted equities – – 23,475 23,475
Total financial asset investments 390,500 – 23,475 413,975
Investments in securities are financial assets designated at fair value through profit or loss on initial recognition. In accordance
with FRS 102 the tables above provide an analysis of these investments based on the fair value hierarchy described below which
reflects the reliability and significance of the information used to measure their fair value.
Fair value hierarchy
The levels are determined by the lowest (that is the least reliable or least independently observable) level of input that is significant
to the fair value measurement for the individual investment in its entirety as follows:
Level 1 – using unadjusted quoted prices for identical instruments in an active market;
Level 2 – using inputs, other than quoted prices included within Level 1, that are directly or indirectly observable (based on market
data); and
Level 3 – using inputs that are unobservable (for which market data is unavailable).
The valuation techniques used by the Company are explained in the accounting policies on pages 86 and 87. A sensitivity analysis
by valuation technique of the unlisted securities is on pages 98 to 100.
Financial report
Annual Report and Financial Statements 2025
92
09 Investments (continued)
Listed
equities
£’000
Unlisted
equities
£’000
Total
£’000
Cost of investments held at 30 September 2024 332,291 30,470 362,761
Investment holding gains/(losses) at 30 September 2024 58,209 (6,995) 51,214
Value of investments held at 30 September 2024 390,500 23,475 413,975
Analysis of transactions made during the year:
Purchases at cost 91,950 5,820 97,770
Sales proceeds received (126,672) – (126,672)
Gains/(losses) on investments (7,483) 25,565 18,082
Value of investments held at 30 September 2025 348,295 54,860 403,155
Cost of investments held at 30 September 2025 307,868 36,290 344,158
Unrealised appreciation at 30 September 2025 40,427 18,570 58,997
Value of investments held at 30 September 2025 348,295 54,860 403,155
The purchases and sales proceeds figures above include transaction costs of £34,000 (2024 – £41,000) and £48,000 (2024 –
£35,000) respectively.
During the reporting period, the company converted its £1,964,000 sennder convertible loan notes into 518 Series D preferred
shares. This conversion was carried out according to the terms specified in the loan agreement.
Before the conversion, interest had accrued on these loan notes, amounting to £246,000. This interest was based on an annual
interest rate of 7.455%.
The conversion and accrued interest have been reflected in the financial statements, in unlisted investments and income respectively.
2025
£’000
2024
£’000
Net gains/(losses) on investments
Gains/(losses) on sales 10,298 (39,846)
Changes in investment holding gains 7,784 83,814
18,082 43,968
Details of significant holdings are noted below in accordance with the disclosure requirements of paragraph 82 of the AIC
Statement of Recommended Practice ‘Financial Statements of Investment Trust Companies and Venture Capital Trusts’ (updated
in July 2022), in relation to unlisted investments included in the ten largest holdings within the list of investments disclosed on
pages 46 and 47. As required, this disclosure includes turnover, pre tax profits and net assets attributable to investors as reported
within the most recently audited financial statements of the investee companies, where possible.
At 30 September
2025
Name Business
Latest
financial
statements
Proportion
of capital
owned
%
Book
cost
£’000
Market
value
£’000
Income
recognised
from
holding in
the period
£’000
Turnover
£’000
Pre-tax
profit/
(loss)
£’000
Net assets
attributable to
shareholders
£’000
Bending Spoons Mobile application
software developer
n/a 0.41 4,382 35,298 Nil Information not publicly available
*
At 30 September
2024
Name Business
Latest
financial
statements
Proportion
of capital
owned
%
Book
cost
£’000
Market
value
£’000
Income
recognised
from
holding in
the period
£’000
Turnover
£’000
Pre-tax
profit/
(loss)
£’000
Net assets
attributable to
shareholders
£’000
Bending Spoons Mobile application
software developer
n/a 0.44 4,382 9,862 Nil Information not publicly available
*
* Confidentiality agreements prevent the disclosure of this information.
93
Baillie Gifford European Growth Trust plc
10 Debtors
2025
£’000
2024
£’000
Accrued income and prepaid expenses 160 294
Taxation recoverable 961 1,024
Investment sales awaiting settlement 2,424 13
3,545 1,331
None of the above debtors are financial assets designated at fair value through profit or loss. The carrying amount of debtors
isareasonable approximation of fair value.
11 Creditors – amounts falling due within one year
2025
£’000
2024
£’000
Interest payable 237 226
Purchases for subsequent settlement
2,112 13
Share buy backs payable
306 2
Other creditors and accruals 645 646
3,300 887
None of the above creditors are financial liabilities held at fair value through profit or loss. Included in other creditors is £462,000
(2024– £440,000) in respect of the investment management fee.
The Company currently has a €30,000,000 bank overdraft credit facility agreement with The Northern Trust Company (the ‘Bank’)
for the purpose of pursuing its investment objective. As at 30 September 2025, nil had been drawn down (2024 – nil). The facility
is uncommitted. Interest is charged at 1.25% above the European Central Bank Main Financing Rate. The Board has currently
agreed to cap a drawdown under this facility at €15,000,000.
The maximum aggregate principal amount which may be outstanding under the facility at any time is the lower of €30,000,000
or 20% of the aggregated value of unencumbered assets acceptable to the Bank. The facility contains covenants preventing the
Company from creating any security interest over any assets of the Company held by the Bank or incurring any other financial
indebtedness without the express permission of the Bank. The Company is required to maintain its status as an investment trust
authorised by HMRC and to maintain the appointment of Northern Trust Investor Services as its Depositary. The facility also
demands automatic repayment in the event of an unremedied breach by the Company or should the Company become insolvent
or subject to insolvency, winding-up or administrative proceedings. There were no breaches of covenants during the year.
12 Creditors – amounts falling due after more than one year
2025
£’000
2024
£’000
Unsecured loan notes:
€30m 1.55% 24 June 2036 26,162 24,938
€30m 1.57% 8 December 2040 26,129 24,906
52,291 49,844
The Company has €30 million of long-term, fixed rate, senior, unsecured privately placed loan notes, with a fixed coupon of
1.57% to be repaid on 8 December 2040 and a further €30 million of long-term, fixed rate, senior, unsecured privately placed
loan notes with a fixed coupon of 1.55% to be repaid on 24 June 2036.
The main covenants which are tested monthly are: (i) Net tangible assets shall not fall below £200,000,000. (ii) Total borrowings
shall not exceed 30% of the Company’s adjusted assets (as defined by the loan agreement). (iii) The Company’s number of
holdings shall not fall below 30.
Financial report
Annual Report and Financial Statements 2025
94
13 Share capital
2025
Number
2025
£’000
2024
Number
2024
£’000
Allotted, called up and fully paid ordinary shares of 2.5p each 324,722,867 8,118 351,783,279 8,795
Treasury shares of 2.5p each 77,720,823 1,943 50,660,411 1,266
Total 402,443,690 10,061 402,443,690 10,061
The Company’s shareholder authority permits it to hold shares bought back in treasury. Under such authority, treasury shares
maybe subsequently either sold for cash (at a premium to net asset value per ordinary share) or cancelled. At 30 September
2025 the Company had authority to buy back 29,030,386 ordinary shares. During the year to 30 September 2025 no ordinary
shares (2024–nil) were bought back for cancellation and 27,060,412 (2024 – 6,365,921) ordinary shares were bought back into
treasury at a cost of £26,852,000 (2024 – £6,001,000). Under the provisions of the Company’s Articles of Association share
buy-backs are funded from the capital reserve. The Company has authority to allot shares under section 551 of the Companies
Act 2006. The Board has authorised use of this authority to issue new shares at a premium to net asset value per share in order
to enhance the net asset value per share for existing shareholders and improve the liquidity of the Company’s shares. During the
year to 30September 2025 no shares were issued (in the year to 30 September 2024 – no shares were issued).
14 Capital and reserves
Share
capital
£’000
Share
premium
account
£’000
Capital
redemption
reserve
£’000
Capital
reserve
– realised
£’000
Capital
reserve
– unrealised
£’000
Revenue
reserve
£’000
Shareholders’
funds
£’000
At 1 October 2024 10,061 125,050 8,750 159,855 54,283 8,432 366,431
Gains on investments – – – 10,299 7, 7 8 3 – 18,082
Investment management
fee charged to capital
– – – (1,421) – – (1,421)
Finance costs charged to capital – – – (643) – – (643)
Exchange differences – – – 191 (2,442) – (2,251)
Ordinary shares bought back
into treasury
– – – (26,852) – – (26,852)
Dividends paid in year – – – – – (2,092) (2,092)
Revenue return after taxation – – – – – 2,662 2,662
At 30 September 2025 10,061 125,050 8,750 141,429 59,624 9,002 353,916
The capital reserve includes unrealised gains of £58,998,000 (2024 – gains of £51,214,000) as disclosed in note 9 and unrealised
currency gains of £626,000 (2024 – gains of £3,069,000).
The revenue reserve of £9,002,000 (2024 – £8,432,000) and the capital reserve (to the extent it constituents realised profits) of
£141,429,000 (2024 – £159,860,000) are distributable.
15 Shareholders’ funds per ordinary share
2025 2024
Shareholders’ funds £353,916,000 £366,431,000
Number of ordinary shares in issue at the year end 324,722,867 351,783,279
Shareholders’ funds per ordinary share 109.0p 104.2p
The shareholders’ funds figures above have been calculated after deducting borrowings at book value, in accordance with the
provisions of FRS 102 and based on 324,722,867 (2024 – 351,783,279) ordinary shares, being the number of ordinary shares in
issue at the year end, excluding shares held in treasury. The net asset value figures shown on the Balance Sheet on page 83 have
been calculated after deducting borrowings at either book value or fair value. Reconciliations between shareholders’ funds and
both NAV measures are shown in the Glossary of terms and alternative performance measures on page 116. There are nodilutive
or potentially dilutive shares in issue.
95
Baillie Gifford European Growth Trust plc
16 Analysis of change in net debt
1 October
2024
£’000
Cash flows
£’000
Other non-cash
changes
£’000
Exchange
movement
£’000
30 September
2025
£’000
Cash at bank 1,856 760 – 191 2,807
Loans due in more than one year (49,844) – (5) (2,442) (52,291)
(47,988) 760 (5) (2,251) (49,484)
17 Contingent liabilities, guarantees and financial commitments
There were no contingent liabilities, guarantees or financial commitments at the year end (2024 – none).
18 Transactions with related parties and the managers and secretaries
The Directors’ fees for the year and interests in the Company’s shares at the end of the year are detailed in the Directors’
Remuneration Report on pages 70 and 71. The Directors’ Fees are included in note 4 on page 89. No Director has a contract
of service withthe Company. During the years reported, no Director was interested in any contract or other matter requiring
disclosure undersection 412 of the Companies Act 2006.
The Management fee due to Baillie Gifford & Co Limited is set out in note 3 on page 89 and the amount accrued at 30September2025
is set out in note 11 on page 93. Details of the Investment Management Agreement are set out on page 53.
The Company is part of a marketing programme which includes all the investment trusts managed by the Manager.
TheCompany’s marketing contribution, recharged by the Manager, was £100,000 (2024 – £95,000) as disclosed in note 4.
19 Financial instruments
The Company invests in equities for the long-term so as to achieve its investment objective of long-term capital growth with
theaim of providing a total return in excess of the FTSE Europe Ex UK Index. The Company borrows money when the Managers
have sufficient conviction that the assets funded by borrowed monies will generate a return in excess of the cost of borrowing.
In pursuing its investment objective, the Company is exposed to various types of risk that are associated with the financial
instruments and markets in which it invests and could result in a reduction in the Company’s net assets and/or a reduction
intheprofits available for dividend.
These risks are categorised here as market risk (comprising currency risk, interest rate risk and other price risk), liquidity risk
andcredit risk. The Board monitors closely the Company’s exposures to these risks but does so in order to reduce the likelihood
of a permanent loss of capital rather than to minimise short-term volatility.
The risk management policies and procedures outlined in this note have not changed substantially from the previous accountingyear.
Market risk
The fair value or future cash flows of a financial instrument or other investment held by the Company may fluctuate because
ofchanges in market prices. This market risk comprises three elements – currency risk, interest rate risk and market price risk.
The Board of Directors reviews and agrees policies for managing these risks and the Company’s Investment Manager assesses
theexposure to market risk when making individual investment decisions as well as monitoring the overall level of market risk across
the investment portfolio on an ongoing basis. Details of the Company’s investment portfolio are shown on pages 46and47.
Currency risk
The Company’s assets, liabilities and income are denominated in currencies other than sterling (the Company’s functional currency
and that in which it reports its results). Consequently, movements in exchange rates may affect the sterling valueofthose items. It is
not the Company’s policy to hedge foreign currency risk on a continuing basis but the Company may,and currently does through the
euro denominated unsecured loan notes, match overseas investments with foreign currencyborrowings.
The Investment Manager monitors the Company’s exposure to foreign currencies and reports to the Board on a regular basis.
The Investment Manager assesses the risk to the Company of the foreign currency exposure by considering the effect on the
Company’s net asset value and income of a movement in the rates of exchange to which the Company’s assets, liabilities,
incomeand expenses are exposed. However, the country in which a company is listed is not necessarily where it earns itsprofits.
The movement in exchange rates on overseas earnings may have a more significant impact upon a company’s valuation than
asimple translation of the currency in which the company is quoted.
Financial report
Annual Report and Financial Statements 2025
96
19 Financial instruments (continued)
Exposure to currency risk through asset allocation, which is calculated by reference to the currency in which the asset or
liabilityis quoted, is shown below.
At 30 September 2025
Investments
£’000
Cash and
deposits
£’000
Loan Notes
£’000
Debtors
and creditors
£’000
Net
exposure
£’000
Euro 209,890 1,113 (52,291) (1,780) 156,932
Swedish kroner 59,448 – – – 59,448
Swiss franc 37,324 – – 368 37,692
Danish krone 28,357 – – 137 28,494
Polish Zloty 26,724 – – 4 26,728
Canadian dollar 17,016 1,646 – – 18,662
Norwegian krone 14,152 – – – 14,152
US dollar 10,244 – – – 10,244
Total exposure to currency risk 403,155 2,759 (52,291) (1,271) 352,352
Sterling – 48 – (754) (706)
403,155 2,807 (52,291) (2,025) 351,646
At 30 September 2024
Investments
£’000
Cash and
deposits
£’000
Loan Notes
£’000
Debtors
and creditors
£’000
Net
exposure
£’000
Euro 213,552 1,803 (49,844) 597 166,108
Danish krone 67,298 – – – 67,298
US dollar 36,986 – – 95 37,081
Canadian dollar 21,090 – – – 21,090
Norwegian krone 20,019 – – – 20,019
Polish zloty 17,354 – – 33 17,387
Swiss franc 16,961 – – 321 17,282
US dollar 17,257 – – – 17,257
Total exposure to currency risk 410,517 1,803 (49,844) 1,046 363,522
Sterling 3,458 53 – (602) 2,909
413,975 1,856 (49,844) 444 366,431
Currency Risk Sensitivity
At 30 September 2025, if sterling had strengthened by 5% in relation to all currencies, with all other variables held constant,
totalnet assets and total return would have decreased by the amounts shown below. A 5% weakening of sterling against all
currencies, with all variables held constant, would have had an equal but opposite effect on the Financial Statement amounts.
Theanalysis is performed on the same basis for 2024.
2025
£’000
2024
£’000
Euro 7,847 8,305
Swedish kroner 2,972 3,365
Swiss franc 1,885 864
Danish krone 1,425 1,854
Polish zloty 1,336 869
Canadian dollar 933 1,055
Norwegian krone 708 1,001
US dollar 512 863
17,618 18,176
97
Baillie Gifford European Growth Trust plc
19 Financial instruments (continued)
Interest rate risk
Interest rate movements may affect the level of income receivable and payable on cash deposits and interest payable on variable
rate borrowings and the fair value of the Company’s fixed-rate borrowings. They may also impact upon the market value of the
Company’s investments as the effect of interest rate movements upon the earnings of a company may have a significant impact
upon the valuation of that company’s equity.
The possible effects on cash flows that could arise as a result of changes in interest rates are taken into account when making
investment decisions and when entering borrowing agreements.
The Board reviews on a regular basis the amount of investments in cash and the income receivable on cash deposits.
The Company has the ability to finance part of its activities through borrowings at approved levels. The amount of such
borrowings and the approved levels are monitored and reviewed regularly by the Board.
During the year to 30 September 2025, the majority of the Company’s assets were non-interest bearing.
Financial assets
Cash deposits generally comprise overnight call or short-term money market deposits and earn interest at floating rates based
onprevailing bank base rates.
Financial liabilities
The interest rate risk profile of the Company’s financial liabilities at 30 September is shown below:
2025
£’000
2024
£’000
Fixed rate – Euro denominated 52,291 49,844
Maturity profile
The maturity profile of the Company’s financial liabilities at 30 September was:
2025
Within
1 year
£’000
2025
Between
1 and 5 years
£’000
2025
More than
5 years
£’000
2024
Within
1 year
£’000
2024
Between
1 and 5 years
£’000
2024
More than
5 years
£’000
Repayment of loan notes – – 52,291 – – 49,844
Accumulated interest on
loan notes
817 3,268 6,911 779 3,268 7,7 3 9
817 3,268 59,202 779 3,268 57,583
Interest rate risk sensitivity
An increase of 1.0% in interest rates, with all other variables being held constant, would have increased the Company’s netassets
for the year to 30 September 2025 by £8,000 (year to 30 September 2024 – £16,000). A decrease of 1.0% would have had an
equal but opposite effect.
Other price risk
Changes in market prices other than those arising from interest rate risk or currency risk may also affect the value of the Company’s
net assets. The Company’s exposure to changes in market prices relates to the fixed asset investments as disclosed in note 8.
The Board manages the market price risks inherent in the investment portfolio by ensuring full and timely access to relevant
information from the Investment Manager. The Board meets regularly and at each meeting reviews investment performance,
theinvestment portfolio and the rationale for the current investment positioning to ensure consistency with the Company’s
objectives and investment policies. The portfolio does not seek to reproduce the index, investments are selected based upon
themerit of individual companies and therefore performance may well diverge from the comparative index.
Other price risk sensitivity – quoted
A full list of the Company’s investments is shown on pages 46 and 47. In addition, a geographical analysis of the portfolio and an
analysis of the investment portfolio by broad industrial or commercial sector are contained on page 48.
98.4% (2024 – 106.6%) of the Company’s net assets are invested in quoted equities. A 20% increase in quoted equity
valuations at 30 September 2025 would have increased total net assets and net return after taxation by £69,659,000 (2024
– £78,100,000). A decrease of 20% would have had an equal but opposite effect. The level of change is considered to be
reasonable based on observations of current market conditions.
Financial report
Annual Report and Financial Statements 2025
98
19 Financial instruments (continued)
Other price risk sensitivity – unlisted
15.5% (2024 – 6.4%) of the Company’s net assets are invested in unlisted investments. The fair valuation of the unlisted
investments is influenced by the estimates, assumptions and judgements made in the fair valuation process (see 1(b) on
pages86and 87). A sensitivity analysis is provided below which recognises that the valuation methodologies employed involve
subjectivity in their significant unobservable inputs and illustrates the sensitivity of the valuations to these inputs. The inputs
havebeen flexed by +/-10% with the exception of the Recent Transaction Price valuation approach as it does not involve
significant subjectivity. The table also provides the range of values for the key unobservable inputs.
As at 30
September 2025 Significant unobservable inputs*
Valuation
technique
Fair value of
investments
£’000
Key
unobservable
inputs
Other
unobservable
inputs
†
Range
Weighted
average
range
#
Sensitivity
%
Sensitivity to
changes
in significant
unobservable inputs
Market approach
using comparable
traded multiples
14,329 EV/NTM
revenue
multiple
a,b,c,d 1.53 –
2.57x
2.27x 10% If EV/LTM multiples
changed by +/-
10%, the fair value
would change
by £797,605 and
(£797,829)
‡
.
Transaction
implied
premiums/
(discounts)
g (14.3%) –
(5.5%)
(8.1%) 10% If the transaction
implied premium/
(discount) is
changed by +/-
10%, the fair value
would change
by £75,858 and
(£76,082).
Recent
transaction price
40,531 N/A a,b N/A N/A 10% If the recent
transaction price
changed by +/- 10%,
the fair value would
change by
+/-£523,403.
99
Baillie Gifford European Growth Trust plc
19 Financial Instruments (continued)
Other price risk sensitivity – unlisted (continued)
As at 30
September 2024 Significant unobservable inputs*
Valuation
technique
Fair value of
investments
£’000
Key
unobservable
inputs
Other
unobservable
inputs
†
Range
Weighted
average
range
#
Sensitivity
%
Sensitivity to
changes
in significant
unobservable inputs
Market approach
using comparable
traded multiples
5,873 EV/NTM
revenue
multiple
a,b,c,d N/A 6.5x 10% If EV/LTM multiples
changed by +/-
10%, the fair value
would change by
£621,066 and
(£623,742)
‡
.
Transaction
implied
premiums/
(discounts)
g N/A (55.7%) 10% If the transaction
implied premium/
(discount) is
changed by +/-
10%, the fair value
would change
by 955,457 and
(£919,070).
Benchmark
performance
2,695
Selection of
comparable
companies and
relevant indices
a,b,c,f (26.7)% –
5.9%
(5.8%) 10% If input comparable
company
performance
changed by +/-
10%, the fair value
would change by
£273,014 and
(£266,614).
Insolvency risk
discount
a,b N/A 90% 10% If the insolvency risk
discount changed
by +/-10%, the fair
value would change
by £971,539 and
(£965,139).
Recent
transaction price
*
14,907 N/A a,b N/A N/A 10% If the recent
transaction price
changed by +/-
10%, the fair value
would change by
+/-£1,490,764.
†
See explanation of significant unobservable inputs below (sections ‘a’ to ‘g’ as relevant).
#
Weighted average is calculated by reference to the fair value of holdings as at the respective year end. This therefore gives a clearer indication of
the typical multiple or adjustment being applied across the portfolio.
‡
Flexing the revenue figures by the same sensitivity would result in the same change in both directions.
* When marking to recent transactions, Baillie Gifford’s Valuation Team ensures that each deal has occurred on an arm’s-length basis. In doing so,
the team considers factors such as the investor mix, transaction size, and the company’s operational progress. Where these and other relevant
conditions are met, private valuations are updated to reflect the closing terms of the recent transactions
Significant unobservable inputs
The variable inputs applicable to each broad category of valuation basis will vary dependent on the particular circumstances
ofeach private company valuation. An explanation of each of the key variable inputs is provided below. The assumptions made
inthe production of the inputs are described in note 1(c) on page 87.
a. Application of valuation basis
Each investment is assessed independently, and the valuation basis applied will vary depending on the circumstances of each
investment. When an investment is pre-revenue, the focus of the valuation will be on assessing the recent transaction and the
achievement of key milestones since investment. Adjustments may also be made depending on the performance of comparable
benchmarks and companies. For those investments where a trading multiples approach can be taken, the methodology will
factor in revenue, earnings or net assets as appropriate for the investment, and where a suitable correlation can be identified
with the comparable companies then a regression analysis will be performed. Discounted cash flows will also be considered
where appropriate forecasts are available.
Financial report
Annual Report and Financial Statements 2025
100
19 Financial instruments (continued)
b. Probability estimation of liquidation events
The probability of a liquidation event such as a company sale, insolvency event, or alternatively an initial public offering (‘IPO’),
is a key variable input in the transaction-based and multiples-based valuation techniques. The probability of an IPO versus a
company sale istypically estimated from the outset to be 50:50 if there has been no indication by the company of pursuing
either of these routes. If the company has indicated an intention to IPO, the probability is increased accordingly to 75% and
if an IPO has become a certainty the probability is increased to 100%. Likewise, in a scenario where a company is pursuing
a trade sale the weightings will be adjusted accordingly in favour of a sale scenario, or in a situation where a company is
underperforming expectations significantly and therefore deemed very unlikely to pursue an IPO. Should there be a risk of
an insolvency event, then an appropriate discount may be applied and the ability to enforce liquidation protections will be
assessed based on the individual circumstances.
c. Selection of comparable companies
The selection of comparable companies is assessed individually for each investment at the point of investment, and the relevance
of the comparable companies is continually evaluated at each valuation. The key criteria used in selecting appropriate comparable
companies are the industry sector in which they operate, the geography of the company’s operations, the respective revenue
and earnings growth rates and the operating margins. Typically, between 4 and 10 comparable companies will be selected for
each investment, depending on how many relevant comparable companies are identified. The resultant revenue or earnings
multiples or share price movements derived will vary depending on the companies selected and the industries they operate in.
d. Estimated sustainable earnings
The selection of sustainable revenue or earnings will depend on whether the company is sustainably profitable or not, and
where it is not then revenues will be used in the valuation. The valuation approach will typically assess companies based on
the last twelve months of revenue or earnings, as they are the most recent available and therefore viewed as the most reliable.
Where a company has reliably forecasted earnings previously or there is a change in circumstance at the business which will
impact earnings going forward, then forward estimated revenue or earnings may be used instead.
Significant unobservable inputs (continued)
e. Application of illiquidity discount
The application of an illiquidity discount will be applied either through the calibration of a valuation against the most
recenttransaction, or by application of a specific discount. The discount applied where a calibration is not appropriate
istypically 10%, reflecting the fact that the majority of the investments held are substantial companies with some
secondarymarket activity.
f. Selection of appropriate benchmarks
The selection of appropriate benchmarks is assessed individually for each investment. The industry and geography of
each company are key inputs to the benchmark selection, with either one or two key indices or benchmarks being used for
comparison.
g. Transaction implied premium and discount
Where there is an implied company valuation available as a result of an external arm’s length transaction, the ongoing valuation
will be calibrated to this by deriving a company valuation with reference to the average multiple from a set of comparable
companies and comparing this to a transaction implied valuation, and could result in an implied premium or discount compared
to comparable companies at the point of transaction. This discount or premium will be considered in future valuations, and
may be reduced due to factors such as period of time since the transaction and company performance. Where a calibrated
approach is not appropriate, a discount for illiquidity will be applied as noted in (e) above.
Liquidity risk
This is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities. Liquidity risk
is not significant as the majority of the Company’s assets are in investments that are readily realisable. The Company’s holdings in
unlisted investments, which are not considered to be readily realisable, amounted to 15.5% of net assets at 30 September 2025
(6.4% of net assets at 30 September 2024).
The Company has the power to take out borrowings, which give it access to additional funding when required.
The maturity profile of the Company’s financial liabilities is on page 9 7.
101
Baillie Gifford European Growth Trust plc
19 Financial instruments (continued)
Credit risk
This is the risk that a failure of a counterparty to a transaction to discharge its obligations under that transaction could result
intheCompany suffering a loss. This risk is managed as follows:
• where the Investment Manager makes an investment in a bond or other security with credit risk, that credit risk is assessed
andthen compared to the prospective investment return of the security in question. The Board regularly receives information
from the Managers on the credit ratings of those bonds and other securities in which the Company has invested (if any);
• the Depositary is liable for the loss of financial instruments held in custody. The Depositary will ensure that any delegate
segregates the assets of the Company. The Depositary has delegated the custody function to The Northern Trust Company.
Bankruptcy or insolvency of the custodian may cause the Company’s rights with respect to securities held by the custodian
tobedelayed. The Investment Manager monitors the Company’s risk by reviewing the custodian’s internal control reports and
reporting its findings to the Board;
• investment transactions are carried out with a large number of brokers whose creditworthiness is reviewed by the Investment
Manager. Transactions are ordinarily undertaken on a delivery versus payment basis whereby the Company’s custodian ensures
that the counterparty to any transaction entered into by the Company has delivered on its obligations before any transfer
ofcash or securities away from the Company is completed;
• the creditworthiness of the counterparty to transactions involving derivatives, structured notes and other arrangements,
wherein the creditworthiness of the entity acting as broker or counterparty to the transaction is likely to be of sustained
interest, is subject to rigorous assessment by the Investment Manager; and
• cash is only held at banks that are regularly reviewed by the Investment Manager.
Credit risk exposure
The exposure to credit risk at 30 September was:
2025
£’000
2024
£’000
Cash at bank 2,807 1,856
Debtors 3,545 1,331
6,352 3,187
None of the Company’s financial assets are past due or impaired.
Fair value of financial assets and financial liabilities
The Directors are of the opinion that there is no difference between the amounts at which the financial assets and liabilities
oftheCompany are carried in the Balance Sheet and their fair values, with the exception of long term borrowings. The fair values
of the Company’s borrowings are shown below. The fair values of the loan notes are calculated by reference to corporate bonds
ofcomparable maturity and yield.
Unsecured loan notes:
2025
Book value
£’000
2025
Fair value
£’000
2024
Book value
£’000
2024
Fair value
£’000
€30m 1.55% 24 June 2036 26,162 20,730 24,938 19,465
€30m 1.57% 8 December 2040 26,129 17,715 24,906 16,960
52,291 38,445 49,844 36,425
Capital management
The objective of the Company is to maximise the total return to its equity shareholders through an appropriate capital structure.
Its borrowings are set out in note 12 on page 93. The Company does not have any externally imposed capital requirements other
than the covenants on its loan notes which are detailed in note 12. The capital of the Company is the ordinary share capital
asdetailed in note 13. It is managed in accordance with its investment policy in pursuit of its investment objective, both of which
are detailed on pages 28 and 29, and shares may be repurchased or issued as explained on page 93.
Shareholder
information
103
Baillie Gifford European Growth Trust plc
Notice of Annual
General Meeting
The Annual General Meeting of Baillie Gifford
European Growth Trust plc will be held at
OneMoorgate Place, City of London, EC2R 6EA
on Wednesday 4February 2026 at 2pm. You
will find directions to the venue by scanning the
QRcodeabove.
To accurately reflect the views of shareholders of the
Company, the Board intends to hold the AGM voting
on a poll.
The Board encourages all shareholders to submit
proxy voting forms as soon as possible and, in any
event, by no later than 2pm on 2 February 2026.
Should shareholders have questions for the
Boardorthe Managers or any queries as to how
tovote orhow to attend the meeting they are
welcome asalways to submit them by email to
enquiries@bailliegifford.com or call 0800 917 2113.
Baillie Gifford may record your call.
For details of how to vote your shares if held via a
platform please refer to theaic.co.uk/how-to-vote-
your-shares.
Moorgate
Moorgate
Copthall Ave
Throgmorton Ave
Finsbury
Moorgate
Circus
London Wall
London Wall
Basinghall Ave
One Moorgate Place
City of London
London
EC2R 6EA
Shareholder information
Annual Report and Financial Statements 2025
104
Notice is hereby given that an Annual General
Meeting of Baillie Gifford European Growth Trust plc
will be held at OneMoorgate Place, City of London,
EC2R 6EA, on Wednesday 4 February 2026, at2pm
for the following purposes.
To consider and, if thought fit, to pass the following
Resolutions as Ordinary Resolutions.
01. To receive and adopt the Financial Statements
of the Company for the year to 30 September
2025 with the Reports of the Directors and of
the Independent Auditor thereon.
02. To approve the Directors’ Remuneration Policy.
03. To approve the Directors’ Annual Report on
Remuneration for the year to 30 September 2025.
04 To declare a final dividend of 0.72p per ordinary
share.
05. To re-elect David Barron as a Director
oftheCompany.
06. To re-elect Davina Curling as a Director
oftheCompany.
07. To re-elect Andrew Watkins as a Director
oftheCompany.
08. To re-elect Emma Davies as a Director
oftheCompany.
09. To re-appoint BDO LLP as Independent
Auditor of the Company to hold office from the
conclusion of this meeting until the conclusion
of the next Annual General Meeting at which
the Financial Statements are laid before the
Company.
10. To authorise the Directors to determine the
remuneration of the Independent Auditor
oftheCompany.
11. That, in substitution for any existing authority,
but without prejudice to the exercise of any such
authority prior to the date hereof, the Directors
of the Company be and they are hereby
generally and unconditionally authorised in
accordance with section 551 of the Companies
Act 2006 (the ‘Act’) to exercise all the powers of
the Company to allot shares in the Company and
to grant rights to subscribe for or to convert any
security into shares in the Company (‘Securities’)
provided that such authority shall be limited to
the allotment of shares and the grant of rights
in respect of shares with an aggregate nominal
value of up to £2,560,023, such authority to
expire at the conclusion of the next Annual
General Meeting of the Company after the
passing of this resolution or on the expiry of
15 months from the passing of this resolution,
whichever is the earlier, unless previously
revoked, varied or extended by the Company in
a general meeting, save that the Company may
at any time prior to the expiry of this authority
make an offer or enter into an agreement which
would or might require Securities to be allotted
or granted after the expiry of such authority
and the Directors shall be entitled to allot or
grant Securities in pursuance of such an offer or
agreement as if such authority had not expired.
To consider and, if thought fit, to pass Resolutions
12, 13 and 14 as Special Resolutions.
12. That, subject to the passing of Resolution 11
above, and in substitution for any existing power
but without prejudice to the exercise of any such
power prior to the date hereof, the Directors of
the Company be and they are hereby generally
empowered, pursuant to sections 570 and 573
of the Companies Act 2006 (the ‘Act’), to allot
equity securities (within the meaning of section
560(1) of the Act), for cash pursuant to the
authority given by Resolution 11 above, and to
sell treasury shares for cash, as if section 561(1)
of the Act did not apply to any such allotment
orsale, provided that this power:
a. expires at the conclusion of the next Annual
General Meeting of the Company after
the passing of this Resolution or on the
expiry of 15 months from the passing of this
Resolution, whichever is the earlier, save that
the Company may, before such expiry, make
an offer or agreement which would or might
require equity securities to be allotted or
treasury shares to be sold after such expiry
and the Directors may allot equity securities or
sell treasury shares in pursuance of any such
offer or agreement as if the power conferred
hereby had not expired; and
105
Baillie Gifford European Growth Trust plc
b. shall be limited to the allotment of equity
securities or the sale of treasury shares up
to an aggregate nominal value of £768,007,
being approximately 10% of the nominal value
of the issued share capital of the Company, as
at 4 December 2025.
13. That, in substitution for any existing authority
but without prejudice to the exercise of any such
authority prior to the date hereof, the Company
be and is hereby generally and unconditionally
authorised, pursuant to and in accordance
with section 701 of the Companies Act 2006
(the ‘Act’) to make market purchases (within
the meaning of section 693(4) of the Act) of
fully paid ordinary shares of 2.5 pence each in
the capital of the Company (‘ordinary shares’)
(either for retention as treasury shares for
future reissue, resale, transfer or cancellation),
provided that:
a. the maximum aggregate number of ordinary
shares hereby authorised to be purchased
is 46,049,709, or, if less, the number
representing approximately 14.99% of
the issued ordinary share capital of the
Company as at the date of the passing of
this Resolution;
b. the minimum price (excluding expenses) which
may be paid for each ordinary share shall be
the nominal value of that share;
c. the maximum price (excluding expenses)
which may be paid for each ordinary share
shall not be more than the higher of:
i. 5 per cent above the average closing
price on the London Stock Exchange of
an ordinary share over the five business
days immediately preceding the date of
purchase; and
ii. the higher of the last independent trade and
the highest current independent bid on the
London Stock Exchange; and
d. unless previously varied, revoked or
renewed by the Company in a general
meeting, the authority hereby conferred
shall expire at the conclusion of the Annual
General Meeting of the Company to be held
in respect of the year ending 30 September
2026, save that the Company may, prior
to such expiry, enter into a contract to
purchase ordinary shares under such
authority which will or might be completed
or executed wholly or partly after the
expiration of such authority and may make a
purchase of ordinary shares pursuant to any
such contract.
14. That, the Company be and is hereby generally
and unconditionally authorised to hold general
meetings (other than Annual General Meetings)
on 14 clear days’ notice,such authority to expire
at the conclusion of the next Annual General
Meeting of the Company.
By order of the Board
Baillie Gifford & Co Limited
Company Secretaries
8 December 2025
Shareholder information
Annual Report and Financial Statements 2025
106
Notes
01. As a member you are entitled to appoint a proxy
or proxies to exercise all or any of your rights
to attend, speak and vote at the AGM. A proxy
need not be a member of the Company but
must attend the AGM to represent you. You may
appoint more than one proxy provided each
proxy is appointed to exercise rights attached to
different shares. You can only appoint a proxy
using the procedure set out in these notes and
the notes to the proxy form. You may not use
any electronic address provided either in this
notice or any related documents (including the
proxy form) to communicate with the Company
for any purpose other than those expressly
stated.
02. To be valid any proxy form or other instrument
appointing a proxy, together with any power
of attorney or other authority under which it
is signed or a certified copy thereof, must be
received by post or (during normal business
hours only) by hand at the Registrars of the
Company at Computershare Investor Services
PLC, The Pavilions, Bridgwater Road, Bristol,
BS99 6ZY or online at eproxyappointment.com
nolater than two days (excluding non-working
days) before the time of the meeting or any
adjourned meeting.
03. CREST members who wish to appoint a proxy
orproxies through the CREST electronic proxy
appointment service may do so by using the
procedures described in the CREST Manual
and/or by logging on to the website euroclear.
com/CREST. CREST personal members or other
CREST sponsored members, and those CREST
members who have appointed a voting service
provider(s), should refer to their CREST sponsor
or voting service provider(s), who will be able to
take the appropriateaction on their behalf.
04. In order for a proxy appointment or instruction
made using the CREST service to be valid, the
appropriate CREST message (a ‘CREST Proxy
Instruction’) must be properly authenticated in
accordance with Euroclear UK & International
Limited’s specifications, and must contain the
information required for such instruction, as
described in the CREST Manual. The message,
regardless of whether it constitutes the
appointment of a proxy or is an amendment to
the instruction given to a previously appointed
proxy must, in order to be valid, be transmitted
so as to be received by the Company’s registrar
(ID 3RA50) no later than two days (excluding
non-working days) before the time of the
meeting or any adjournment. For this purpose,
the time of receipt will be taken to be the time
(as determined by the timestamp applied to the
message by the CREST Application Host) from
which the Company’s registrar is able to retrieve
the message by enquiry to CREST in the manner
prescribed by CREST. After this time any change
of instructions to proxies appointed through
CREST should be communicated to the
appointee through other means.
05. CREST members and, where applicable, their
CREST sponsors, or voting service providers
should note that Euroclear UK & International
Limited does not make available special
procedures in CREST for any particular
message. Normal system timings and limitations
will, therefore, apply in relation to the input of
CREST Proxy Instructions. It is the responsibility
of the CREST member concerned to take (or, if
the CREST member is a CREST personal
member, or sponsored member, or has appointed
a voting service provider(s), to procure that his/
her CREST sponsor or voting service provider(s)
take(s)) such action as shall be necessary to
ensure that a message is transmitted by means
of the CREST system by any particular time.
Inthis connection, CREST members and, where
applicable, their CREST sponsors or voting
system providers are referred, in particular,
tothose sections of the CREST Manual
concerning practical limitations of the CREST
system and timings.
06. The Company may treat as invalid a CREST
Proxy Instruction in the circumstances set out
in Regulation 35(5)(a) of the Uncertificated
Securities Regulations 2001.
07. The return of a completed proxy form or
other instrument of proxy will not prevent
youattending the AGM and voting in person
ifyou wish.
08. Pursuant to Regulation 41 of the Uncertificated
Securities Regulations 2001 and section 311 of
the Companies Act 2006 the Company specifies
that to be entitled to attend and vote at the
Annual General Meeting (and for the purpose of
the determination by the Company of the votes
they may cast), shareholders must be registered
in the Register of Members of the Company
no later than two days (excluding non-working
days) prior to the commencement of the AGM or
any adjourned meeting. Changes to the Register
of Members after the relevant deadline shall
be disregarded in determining the rights of any
person to attend and vote at the meeting.
107
Baillie Gifford European Growth Trust plc
09. Any person to whom this notice is sent who is
a person nominated under section 146 of the
Companies Act 2006 to enjoy information rights
(a ‘Nominated Person’) may, under an agreement
between him/her and the shareholder by whom
he/she was nominated, have a right to be
appointed (or to have someone else appointed)
as a proxy for the Annual General Meeting.
If a Nominated Person has no such proxy
appointment right or does not wish to exercise
it,he/she may, under any such agreement, have
a right to give instructions to the shareholder as
to the exercise of voting rights.
10. The statement of the rights of shareholders in
relation to the appointment of proxies in Notes
1 and 2 above does not apply to Nominated
Persons. The rights described in those Notes
can only be exercised by shareholders of the
Company.
11. Under section 338 of the Companies Act 2006,
members meeting the qualification criteria set
out in note 14 below may, subject to certain
conditions, require the Company to circulate
to members notice of a resolution which may
properly be moved and is intended to be moved
at that meeting. The conditions are that:
a. the resolution must not, if passed,
be ineffective (whether by reason of
inconsistency with any enactment or the
Company’s constitution or otherwise);
b. the resolution must not be defamatory of any
person, frivolous or vexatious; and
c. the request:
i. may be in hard copy form or in electronic
form;
ii. must identify the resolution of which
notice is to be given by either setting out
the resolution in full or, if supporting a
resolution sent by another member, clearly
identifying the resolution which is being
supported;
iii. must be authenticated by the person or
persons making it; and
iv. must be received by the Company not later
than 24 December 2025.
12. Under section 338A of the Companies Act
2006, members meeting the qualification
criteria set out at note 14 below may require
the Company to include in the business to
be dealt with at the Annual General Meeting
a matter (other than a proposed resolution)
which may properly be included in the business
(amatter ofbusiness). The request must have
been received by the Company no later than
24December 2025. The conditions are that the
matter of business must not be defamatory of
any person, frivolous or vexatious.
The request must identify the matter of business
by either setting it out in full or, if supporting
a statement sent by another member, clearly
identify the matter of business which is being
supported. The request must be accompanied
by a statement setting out the grounds for the
request. Members seeking to do this should
write to the Company providing their full name
and address.
13. Under section 527 of the Companies Act 2006,
members meeting the qualification criteria set
out in note 14 below may require the Company
to publish, on its website, (without payment) a
statement (which is also passed to the Auditor)
setting out any matter relating to the audit of the
Company’s Financial Statements, including the
Auditor’s Report and the conduct of the audit.
Such requests must be made in writing and must
state your full name and address.
14. In order to be able to exercise the members’
rights in notes 11 to 13, the relevant request
must be made by:
a. members representing at least 5% of the
total voting rights of all the members who
have a right to vote on the resolution to
which the requests relate; or
b. at least 100 members who have a right to
vote on the resolution to which the requests
relate and hold shares in the Company on
which there has been paid up an average
sum, per member, of at least £100.
Such requests should be sent to the Company
at Calton Square, 1 Greenside Row, Edinburgh,
EH1 3AN. Electronic requests permitted under
section 338 (see note 11) should be sent to
enquiries@bailliegifford.com.
Shareholder information
Annual Report and Financial Statements 2025
108
15. Information regarding the Annual General
Meeting, including information required by
section 311A of the Companies Act 2006, is
available from the Company’s page of the
Managers’ website at bgeuropeangrowth.com.
16. As at 4December 2025 (being the last
practicable day prior to the publication of this
notice) the Company’s issued share capital
consisted of 307,202,867 ordinary shares,
carrying one vote each. Therefore, the total
voting rights in the Company as at 4December
2025 were 307,202,867 votes. Voting on the
resolutions will be conducted by way of a poll.
This will ensure an extact and definitive result.
17. Any person holding 3% or more of the total
voting rights of the Company who appoints a
person other than the Chairman of the meeting
as his/her proxy will need to ensure that both
he/she and his/her proxy comply with their
respective disclosure obligations under the
UKDisclosure and Transparency Rules.
18. No Director has a contract of service with
theCompany.
109
Baillie Gifford European Growth Trust plc
Baillie Gifford European Growth Trust is an
investment trust. Investment trusts offer
investors the following:
• participation in a diversified portfolio of shares;
• constant supervision by experienced professional
managers; and
• the Company is free from capital gains tax on
capital profits realised within its portfolio, although
investors are still liable for capital gains tax on
profits when selling their investment.
How to invest
The Company’s shares are traded on the London
Stock Exchange. They can be bought by placing an
order with a stockbroker, or by asking a professional
adviser to do so. If you are interested in investing
directly in Baillie Gifford European Growth Trust,
youcan do so online. There are a number of
companies offering real time online dealing services.
Find out more by visiting the investment trust pages
at bailliegifford.com.
Sources of further information on the
Company
The price of the Company’s shares is quoted daily
in the Financial Times and can also be found on
the Company’s page of the Managers’ website at
bgeuropeangrowth.com, Trustnet at trustnet.com
and on other financial websites. Company factsheets
are also available on the Baillie Gifford website
and are updated monthly. These are available from
BaillieGifford on request.
Baillie Gifford European Growth Trust
Identifiers
ISIN GB00BMC7T380
Sedol BMC7T38
Ticker BGEU
Legal Entity Identifier 213800QNN9EHZ4SC1R12
The ordinary shares of the Company are listed on
the London Stock Exchange.
Key dates
Ordinary shareholders normally receive one dividend
in respect of each financial year paid in February.
The Annual Report and Financial Statements are
normally issued in November/December and the
AGM is normally held in January/February.
Share register enquiries
Computershare Investor Services PLC maintains
theshare register on behalf of the Company. Inthe
event of queries regarding shares registered in
yourown name, please contact the Registrars on
0370 889 4086.
This helpline also offers an automated self-service
functionality (available 24 hours a day, 7 days a
week) which allows you to:
• hear the latest share price;
• confirm your current share holding balance; and
• order Change of Address, Dividend Bank Mandate
and Stock Transfer forms.
Further shareholder
information
Shareholder information
Annual Report and Financial Statements 2025
110
You can also check your holding on the Registrars’
website at investorcentre.co.uk. They also offer a
free, secure share management website service
which allows you to:
• view your share portfolio and see the latest market
price of your shares;
• calculate the total market price of each
shareholding;
• view price histories and trading graphs;
• change address details; and
• use online dealing services.
To take advantage of this service, please log in at
investorcentre.co.uk and enter your Shareholder
Reference Number and Company Code (this
information can be found on the last dividend
voucher or your share certificate).
Electronic proxy voting
If you hold stock in your own name you can choose
to vote by returning proxies electronically at
eproxyappointment.com.
If you have any questions about this service please
contact Computershare on 0370 889 4086.
Dividend Reinvestment Plan
Computershare operate a Dividend Reinvestment
Plan which can be used to buy additional shares
instead of receiving your dividend via cheque or into
your bank account. For further information log on to
investorcentre.co.uk and follow the instructions or
telephone 0370 889 4086.
CREST proxy voting
If you are a user of the CREST system (including
aCREST Personal Member), you may appoint
one or more proxies or give an instruction to a
proxy byhaving an appropriate CREST message
transmitted. For further information please refer
tothe CREST Manual.
111
Baillie Gifford European Growth Trust plc
Communicating
with shareholders
Trust magazine Baillie Gifford European Growth Trust web page at
bgeuropeangrowth.com
Trust magazine
Trust is the Baillie Gifford investment trust magazine
which is published twice a year. It provides an
insightto our investment approach by including
interviews with our fund managers, as well as
containing investment trust news, investment
features and articles about the trusts managed by
Baillie Gifford, including Baillie Gifford European
Growth Trust. Trust plays an important role in
helping to explain our products so that readers can
really understand them.
You can subscribe to Trust magazine or view a
digitalcopy at bailliegifford.com/trust
Suggestions and Questions
Any suggestions on how communications with
shareholders can be improved are welcomed, so
please contact the Baillie Gifford Client Relations
Team and give them your suggestions. They will also
be very happy to answer questions that you may
have about Baillie Gifford European Growth Trust.
Baillie Gifford European Growth Trust
ontheweb
Up-to-date information about Baillie Gifford
European Growth Trust is available on the
Company’s page of the Managers’ website at
bgeuropeangrowth.com. You will find full details of
the Company, including recent portfolio information
and performance figures.
Electronic communications from
theCompany
Shareholders now have the opportunity to be notified
by email when the Company’s Annual Reports,
Interim Reports and other formal communications
are available on the website, instead of receiving
printed copies by post. This has environmental
benefits in the reduction of paper, printing, energy
and water usage, as well as reducing costs to
theCompany.
If you have not already elected to receive electronic
communications from the Company and wish to do
so, please contact the Registrar using the details
shown on page 119. Please have your Shareholder
Reference Number to hand.
Shareholder information
Annual Report and Financial Statements 2025
112
Pushing rocks uphill: the case for
European equities in 2025 | Baillie
Gifford
by Thomas Hodges
Thomas Hodges Highlights European
Revival: Infrastructure Investments Propel
Nexans, Kingspan, ASML, and ASM Amid
Market Shifts.
Europe’s turning point
by Chris Davies
Chris Davies on Europe’s Economic Shift:
Defence Spending and Market Reforms
Open Growth Opportunities.
The Next Chapter
Baillie Gifford Trusts Look Ahead:
Managers Gather in Edinburgh to
Emphasize Private Investment and AI
Progress Amid Optimism.
Client relations team contact details
You can contact the Baillie Gifford Client Relations
Team by telephone, email or post:
Telephone: 0800 917 2113
Your call may be recorded for training or monitoring
purposes.
Email: enquiries@bailliegifford.com
Website: bailliegifford.com
Address:
Baillie Gifford Client Relations Team
Calton Square
1 Greenside Row
Edinburgh EH1 3AN
Please note that Baillie Gifford is not permitted
to give financial advice. If you would like advice,
please ask an authorised intermediary.
113
Baillie Gifford European Growth Trust plc
UK Alternative Investment Fund Managers
(‘AIFM’) Regulations
In accordance with the AIFM Regulations,
information in relation to the Company’s leverage
and the remuneration of the Company’s AIFM,
BaillieGifford & Co Limited, is required to be
madeavailable to investors.
AIFM Remuneration
In accordance with the Regulations, the AIFM
remuneration policy is available at bailliegifford.
com or on request (see contact details on page 119).
Thenumerical remuneration disclosures in respect
of the AIFM’s reporting period are available at
bailliegifford.com.
Leverage
The Company’s maximum and actual leverage
(seeGlossary of terms and alternative performance
measures on page 120) levels at 30 September 2025
are shown below:
Gross method
Commitment
method
Maximum limit 2.50:1 2.00:1
Actual 1.15:1 1.15:1
Automatic exchange of information
In order to fulfil its obligations under UK tax
legislation relating to the automatic exchange of
information, the Company is required to collect
and report certain information about certain
shareholders.
The legislation requires investment trust companies
to provide personal information to HMRC on certain
investors who purchase shares in investment
trusts. As an affected company, Baillie Gifford
European Growth Trust will have to provide
information annually to the local tax authority on
the tax residencies of a number of non-UK based
certificated shareholders and corporate entities.
Shareholders, excluding those whose shares are
held in CREST, who come on to the share register
will be sent a certification form for the purposes of
collecting this information.
For further information, please see HMRC’s
QuickGuide: Automatic Exchange of Information –
information for account holders
gov.uk/government/publications/exchange-of-
information-account-holders.
Shareholder information
Annual Report and Financial Statements 2025
114
Third party data
provider disclaimer
No third party data provider (‘Provider’) makes any
warranty, express or implied, as to the accuracy,
completeness or timeliness of the data contained
herewith nor as to the results to be obtained by
recipients of the data.
No Provider shall in any way be liable to any
recipient of the data for any inaccuracies, errors
or omissions in the index data included in this
document, regardless of cause, or for any damages
(whether direct or indirect) resulting therefrom. No
Provider has any obligation to update, modify or
amend the data or to otherwise notify a recipient
thereof in the event that any matter stated herein
changes or subsequently becomes inaccurate.
Without limiting the foregoing, no Provider shall have
any liability whatsoever to you, whether in contract
(including under an indemnity), in tort (including
negligence), under a warranty, under statute or
otherwise, in respect of any loss or damage suffered
by you as a result of or in connection with any
opinions, recommendations, forecasts, judgements,
or any other conclusions, or any course of action
determined, by you or any third party, whether or
not based on the content, information or materials
contained herein.
FTSE Index data
Source: London Stock Exchange Group plc and its
group undertakings (collectively, the ‘LSE Group’).
©LSE Group 2025. FTSE Russell is a trading name
of certain of the LSE Group companies. ‘FTSE®’
‘Russell®’, ‘FTSE Russell®, are trade marks of the
relevant LSE Group companies and are used by
anyother LSE Group company under license.
Allrights in the FTSE Russell indices or data
vest in the relevant LSE Group company which
owns the index or the data. Neither LSE Group
nor its licensors accept any liability for any errors
or omissions in the indices or data and no party
may rely on any indices or data contained in this
communication. No further distribution of data from
the LSE Group is permitted without the relevant
LSEGroup company’s express written consent.
TheLSE Group does not promote, sponsor or
endorse the content of this communication.
115
Baillie Gifford European Growth Trust plc
The EU Sustainable Finance Disclosure Regulation
(‘SFDR’) does not have a direct impact in the UK
due to Brexit, however, it applies to third-country
products marketed in the EU. As Baillie Gifford
European Growth Trust is marketed in the EU by the
AIFM, Baillie Gifford & Co Limited, via the National
Private Placement Regime (‘NPPR’) the following
disclosures have been provided to comply with the
high-level requirements of SFDR.
The AIFM has adopted Baillie Gifford & Co’s ESG
Principles and Guidelines as its policy on integration
of sustainability risks in investment decisions.
Baillie Gifford & Co believes that a company
cannot be financially sustainable in the long run if
its approach to business is fundamentally out of
line with changing societal expectations. It defines
‘sustainability’ as a deliberately broad concept which
encapsulates a company’s purpose, values, business
model, culture, and operating practices.
Baillie Gifford & Co’s approach to investment is
based on identifying and holding high quality growth
businesses that enjoy sustainable competitive
advantages in their marketplace. To do this it
looks beyond current financial performance,
undertaking proprietary research to build up an
in-depth knowledge of an individual company
and a view on its long-term prospects. This
includes the consideration of sustainability factors
(environmental, social and/or governance matters)
which it believes will positively or negatively
influence the financial returns of an investment.
Sustainable Finance Disclosure
Regulation (‘SFDR’) (unaudited)
The likely impact on the return of the portfolio
from a potential or actual material decline in the
value of investment due to the occurrence of
an environmental, social or governance event
or condition will vary and will depend on several
factors including but not limited to the type, extent,
complexity and duration of an event or condition,
prevailing market conditions and existence of any
mitigating factors. Whilst consideration is given to
sustainability matters, there are no restrictions on
the investment universe of the Company, unless
otherwise stated within in its Investment Objective
& Policy. Baillie Gifford & Co can invest in any
companies it believes could create beneficial
long-term returns for investors. However, this might
result in investments being made in companies
that ultimately cause a negative outcome for
the environment or society. More detail on the
Manager’sapproach to sustainability can be found
in the ESG Principles and Guidelines document,
available publicly on the Baillie Gifford website
bailliegifford.com and by scanning the QR code
below. The underlying investments do not take
into account the EU criteria for environmentally
sustainable economic activities established under
the EU Taxonomy Regulation.
Shareholder information
Annual Report and Financial Statements 2025
116
Glossary of terms and alternative
performance measures (‘APM’)
An alternative performance measure (‘APM’) is a financial measure of historical or future financial
performance, financial position, or cash flows, other than a financial measure defined or specified in the
applicable financial reporting framework. The APMs noted below are commonly used measures within the
investment trust industry and serve to improve comparability between investment trusts.
Total assets
This is the Company’s definition of Adjusted Total Assets, being the total value of all assets less current
liabilities, before deduction of all borrowings.
Shareholders’ funds
Shareholders’ funds is the value of all assets held less all liabilities, with borrowings deducted at book value.
Net asset value
Net Asset Value is the value of total assets less liabilities with borrowings deducted at either book value or
fair value as described below. The net asset value per share (NAV) is calculated by dividing this amount by
the number of ordinary shares in issue (excluding treasury shares).
Net asset value (borrowings at fair value) (APM)
Borrowings are valued at an estimate of market worth. The fair value of the Company’s loan notes is set out
in note 19 on page 101.
A reconciliation from shareholders’ funds (borrowings at book value) to net asset value after deducting
borrowings at fair value is provided below.
2025
£’000
2025
per share
2024
£’000
2024
per share
Shareholders’ funds (borrowings at book value) 353,916 109.0p 366,431 104.2p
Add: book value of borrowings 52,291 16.1p 49,844 14.2p
Less: fair value of borrowings (38,445) (11.8p) (36,425) (10.4p)
Net asset value (borrowings at fair value) 367,762 113.3p 379,850 108.0p
The per share figures above are based on 324,722,867 (2024 – 351,783,279) ordinary shares of 2.5p, being
the number of ordinary shares in issue at the year end.
Net liquid assets
Net liquid assets comprise current assets less current liabilities, excluding borrowings.
117
Baillie Gifford European Growth Trust plc
Discount/premium (APM)
As stockmarkets and share prices vary, an investment trust’s share price is rarely the same as its NAV.
Whenthe share price is lower than the NAV it is said to be trading at a discount. The size of the discount is
calculated by subtracting the NAV from the share price and is usually expressed as a percentage of the NAV.
If the share price is higher than the NAV, it is said to be trading at a premium.
2025
NAV (book)
2025
NAV (fair)
2024
NAV (book)
2024
NAV (fair)
Closing NAV 109.0p 113.3p
104.2p
108.0p
Closing share price 103.5p 103.5p 91.0p 91.0p
Discount 5.0% 8.6% 12.7% 15.7%
Total return (APM)
The total return is the return to shareholders after reinvesting the net dividend on the date that the share
price goes ex-dividend.
2025
NAV (fair)
2025
NAV (book)
2025
Share price
2024
NAV (fair)
2024
NAV (book)
2024
Share price
Closing NAV/share price (a) 113.3p 109.0p 103.5p
108.0p 104.2p
91.0p
Dividend adjustment
factor*
(b) 1.0058 1.0058 1.0068 1.0039 1.0040 1.0045
Adjusted closing NAV/share
price
(c) = (a) x (b) 113.9p 109.6p 104.2p 108.4p 104.6p 91.4p
Opening NAV/share price (d) 108.0p 104.2p 91.0p 96.7p 91.4p 83.6p
Total return (c) ÷ (d) -1 5.5% 5.2% 14.5% 12.1% 14.5% 9.3%
*
The dividend adjustment factor is calculated on the assumption that the final dividend of 0.6p (2024 – dividends of 0.4p) paid by the Company during
the year were reinvested into shares of the Company at the cum income NAV/share price, as appropriate, at the ex-dividend date.
The NAV(fair) total return for the period since Baillie Gifford began managing the portfolio in November 2019 can be calculated using the methodology
shown in the table above and an opening NAV of 93.7p, a dividend adjustment factor of 1.0615 and a closing NAV of 108.0p.
Shareholder information
Annual Report and Financial Statements 2025
118
Leverage (APM)
For the purposes of the Alternative Investment
Fund Managers (AIFM) Regulations, leverage is any
method which increases the Company’s exposure,
including the borrowing of cash and the use of
derivatives. It is expressed as a ratio between the
Company’s exposure and its net asset value and can
be calculated on a gross and a commitment method.
Under the gross method, exposure represents the
sum of the Company’s positions after the deduction
of sterling cash balances, without taking into
account any hedging and netting arrangements.
Under the commitment method, exposure is
calculated without the deduction of sterling cash
balances and after certain hedging and netting
positions are offset against each other.
Active share (APM)
Active share, a measure of how actively a portfolio
is managed, is the percentage of the portfolio that
differs from its comparative index. It is calculated by
deducting from 100 the percentage of the portfolio
that overlaps with the comparative index. An active
share of 100 indicates no overlap with the index and
an active share of zero indicates a portfolio that
tracks the index.
Ongoing charges (APM)
The total expenses (excluding borrowing costs) incurred by the Company as a percentage of the average
netasset value with borrowings at fair value. The ongoing charges have been calculated on the basis
prescribed by the Association of Investment Companies.
A reconciliation from the expenses detailed in the Income Statement on page 82 is provided below.
2025 2024
Investment management fee £1,776,000 £1,847,000
Other administrative expenses £626,000 £630,000
Total expenses (a) £2,402,000 £2,477,000
Average net asset value (with borrowings deducted at fair value) (b) £366,441,000 £383,617,000
Ongoing charges ((a) ÷ (b) expressed as a percentage) 0.66% 0.65%
Gearing (APM)
At its simplest, gearing is borrowing. Just like any other public company, an investment trust can borrow
money to invest in additional investments for its portfolio. The effect of the borrowing on shareholders’ funds
is called ‘gearing’. If the Company’s assets grow, shareholders’ funds grow proportionately more because the
debt remains the same. But if the value of the Company’s assets falls, the situation is reversed. Gearing can
therefore enhance performance in rising markets but can adversely impact performance in falling markets.
Net Gearing is the Company’s borrowings adjusted for cash at hand expressed as a percentage of
shareholders’ funds.
Gross gearing is the Company’s borrowings expressed as a percentage of shareholders’ funds.
2025
£’000
2024
£’000
Borrowings (at book value) (a) 52,291 49,844
Less: cash at hand (2,807) (1,856)
Adjusted borrowings (b) 49,484 47,988
Shareholders' funds (c) 353,916 366,431
Gross gearing ((a) ÷ (c) expressed as a percentage) 14.8% 13.6%
Net gearing ((b) ÷ (c) expressed as a percentage) 14.0% 13.1%
119
Baillie Gifford European Growth Trust plc
Directors
Chairman: D Barron
D Curling
E Davies
A Watkins
Alternative Investment Fund
Managers and Secretaries
Baillie Gifford & Co Limited
Calton Square
1 Greenside Row
Edinburgh
EH1 3AN
T: +44 (0)131 275 2000
bailliegifford.com
Registrar
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol BS99 6ZZ
T: +44 (0)370 889 4086
Depositary
Northern Trust Investor Services Limited
50 Bank Street
Canary Wharf
London E14 5NT
Company Broker
Peel Hunt LLP
7th Floor
100 Liverpool Street
London EC2M 2AT
Independent Auditor
BDO LLP
55 Baker Street
London W1U 7EU
Further information
Client Relations Team
Baillie Gifford & Co
Calton Square
1 Greenside Row
Edinburgh EH1 3AN
T: +44 (0)800 917 2113
enquiries@bailliegifford.com
Company details
bgeuropeangrowth.com
Company Registration No. 1055384
ISIN: GB00BMC7T380
Sedol: BMC7T38
Ticker: BGEU
Legal Entity Identifier:
213800QNN9EHZ4SC1R12
Company
information
Registered office
Baillie Gifford & Co
3 St Helen’s Place
London
EC3A 6AB
Calton Square, 1 Greenside Row, Edinburgh EH1 3AN
Telephone +44 (0)131 275 2000
bgeuropeangrowth.com