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Annual Report and Financial Statements
30 April 2025
Baillie Gifford
UK Growth
Trust plc
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Investor disclosure document
The UK Alternative Investment Fund Managers Regulations requires 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 bgukgrowthtrust.com.
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 UK 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 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 are in the United Kingdom or, if not, from another
appropriately authorised financial adviser.
If you have sold or otherwise transferred all of your holding in Baillie Gifford UK 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 of 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.
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Contents
Financial highlights 02
Strategic report
Chairman’s statement 05
Managers’ report 08
The managers’ core investment principles 11
Baillie Gifford’s stewardship principles 12
Baillie Gifford proxy voting 13
Environmental, social and governance engagement 15
Review of investments 18
List of investments 22
One year summary 24
Five year summary 25
Ten year record 26
Business review 28
Governance report
Directors and management 40
Directors’ report 42
Corporate governance report 47
Audit Committee report 55
Directors’ remuneration report 57
Statement of Directors’ responsibilities 61
Financial report
Independent auditor’s report 63
Income statement 71
Balance sheet 72
Statement of changes in equity 73
Cash flow statement 74
Notes to the financial statements 75
Shareholder information
Notice of Annual General Meeting 89
Further shareholder information 95
Communicating with shareholders 97
Glossary of terms and Alternative Performance Measures 100
Sustainable Finance Disclosure Regulation 103
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The principal investment objective of the Company is to achieve capital growth
predominantly from investment in UK equities, with the aim of providing a total
return in excess of the FTSE All-Share Index.
Financial highlights
Year to 30 April 2025
Total returns*
Share price
13.6%
NAV
7.1%
Benchmark
7.5%
Share price total return*
(figures rebased to 100 at 30 April 2024)
GRAPH
Discount*
(figures plotted at month end dates)
GRAPH
* Alternative performance measure - see Glossary of Terms and Alternative Performance Measures on pages 100 to 102.
† The benchmark is the FTSE All-Share Index.
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 99.
Past performance is not a guide to future performance.
PICTURE
An example of advertising that ran across print and digital media for Baillie Gifford UK Growth Trust
plc during May and June 2025.
Publishers included the Financial Times, The Telegraph and MoneyWeek.
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Strategic
report
The Strategic report, which includes pages 04 to 38 and incorporates the Chairman’s statement
has been prepared in accordance with the Companies Act 2006.
Chairman’s statement
Neil Rogan
Chairman
Appointed to the Board in 2024 and as Chairman in 2024
It has felt like one step forward and one step back this year. Relative performance was strong in the
first half of the year but poor in the second half. For the full year to 30 April 2025, NAV total return
was +7.1%%, slightly behind the FTSE All-Share Index total return of +7.5%. Your share price total
return was better at +13.6% as the discount narrowed from 15.3% to 10.5%. The portfolio had been
performing well until hitting an air pocket in February/March when the uncertainty caused globally by
President Trump’s tariff impositions and a simultaneous collapse in confidence in UK economic
growth hit UK equity returns and growth companies in particular. The performance attribution
numbers reveal that stock selection was the major culprit, with 4Imprint and Renishaw the largest
detractors.
Earnings and Dividend
For the year to 30 April 2025, the revenue return per share was 5.32p (2024 – 5.68p). The year-on-year
decrease was largely as a consequence of reduced dividends paid by 4Imprint and St James’ Place and
the sale of holdings in Rio Tinto and Hargreaves Lansdown. One of the advantages of our investment
trust structure is that we can recommend a final dividend of 5.70p per share to shareholders, payable on
12 September 2025. Accumulated Revenue Reserves at the year end of 13.6p per share are ample to
fund the difference, although the number of shares bought back since the year-end (dividends are not
paid on shares held in Treasury) means that we are unlikely to need to dip into these reserves this time.
The Company’s focus is on capital growth rather than income; shareholders should not expect a regular
or steady level of income to be paid by the Company.
Borrowings and Gearing
At present, the Company has a one-year £30 million rolling credit facility with Royal Bank of Scotland
International Limited. Drawn and invested gearing stood at 9% and 9% of shareholders’ funds as at the
Company’s year end compared to 6% and 5% respectively a year earlier. Over the financial year,
invested gearing ranged between 4% and 10%.
The Board sets the gearing parameters within which the portfolio managers operate. These are
reviewed at each board meeting but are subject to drawn gearing not representing more than 20% of
shareholders’ funds at time of drawdown.
Issuance, Buybacks and Treasury
The Board is keen that the Company’s shares do not trade at a double digit discount to their NAV.
Despite being more active in buying back shares over the last year, at points the share price discount
was wider than desired. Therefore, in January, the Board announced to the market that it had
determined to use buybacks with the aim of maintaining a single digit discount to the Company’s NAV
per share in normal market conditions. From 28 January 2025 to 30 April 2025, the Company’s
discount averaged 9.6% and has averaged 9.9% since the Company’s year-end.
Over the Company’s financial year, the discount averaged 13.1%, ranging between 8.5% and 16.5%,
ending the financial year at 10.5% compared to 15.3% a year earlier. The Company bought back into
treasury 17,403,697 shares, representing 11.9% of the Company’s issued share capital as at 30 April
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2024. Since the financial year end, a further 1,623,033 shares have been bought back. The Company
currently has 33,265,407 shares held in treasury.
The Company benefits from the flexibility of being able to issue new shares or to re-issue any shares
that might be held in treasury, when there is sufficient demand, at a premium to NAV as this helps to
improve trading liquidity and reduces ongoing costs by being asset accretive. As some shareholders
will have noticed, the rate and quantum of buybacks has increased over the course of 2025, meaning
that the Company has called a General Meeting for 3 July 2025 seeking shareholder approval to renew
the buyback authority earlier than would normally have been the case. Not doing so would likely mean
that the Company would run out of buyback authority prior to its next scheduled renewal (subject to
shareholder approval) request at the 3 September 2025 AGM. The Company will also seek to renew
the annual issuance authority at its upcoming AGM and this will supersede the authority, should it be
granted, of 3 July 2025. To avoid any dilution to existing shareholders, shares held in treasury and any
new shares would only be issued/re-issued at a premium to the NAV per share and after associated
costs.
Board Composition
As highlighted in my interim report, Ms Carolan Dobson stood down as Chairman in August 2024,
having served on the Board for nearly ten years. I would like to reiterate my thanks to her for her
contribution to the Company.
Following her retirement, Trust Associates, an external recruitment consultant, was engaged to support
the process to appoint a new board director, resulting in the appointment of Ms Seema Paterson from 2
January 2025. Ms Paterson is a qualified chartered accountant and has notable senior public and private
company experience. Her biography, along with that of the other directors, can be found on page 41 of
the Annual Report.
The appointment of Ms Paterson is to be approved by shareholders at the Company’s AGM in
September.
Annual General Meeting
The Company’s AGM is scheduled to take place at noon, Wednesday 3 September at 1 Moorgate
Place, City of London, London EC2R 6EA. Shareholders should note that this is not the same venue as
in 2024. The meeting will include a presentation by the portfolio managers on the prospects for UK
equities and the positioning of the portfolio. They and the Board will be available to answer any
questions. Light refreshments will be available and shareholders are welcome to bring a guest
with them.
Outlook
With US policy announcements almost daily, any outlook such as this will date quickly. So it will
focus on the long term drivers for BGUK.
BGUK is a portfolio of long-term growth investments in the UK stock market. The portfolio managers
have researched the investment companies thoroughly and have reviewed all of them in the past year to
assess suitability for retention. Measured by active risk, or deviation from the index, it is a very active
portfolio: Active share at 89.5% is very high compared to other UK investment trust companies and
OEICs. Portfolio turnover is lower than elsewhere as the Managers’ style is to take long-term
conviction positions. The portfolio managers cover the holdings in detail in their report but, overall, the
portfolio has an average PE ratio of 18.8 times for the current year and a future 3Y projected EPS
growth of 7.5%. It is unusual for a portfolio of growth companies to trade at levels this attractive.
In the last 12 months, the Board has been active in making BGUK a better proposition for investors.
Last year we introduced a 5-year performance conditional tender offer by which shareholders, if they
wish, will be able to sell their entire holding at NAV less 2% if the NAV total return over the 5 years to
30 April 2029 does not beat the FTSE All-Share Index. This makes the Company somewhat of an
each-way bet: If performance goes well, shareholders should be rewarded handsomely; if it does not,
then they will be able to sell their holding near to NAV. Recognising that 5 years is a long time for
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some shareholders to wait, we also introduced an additional continuation vote scheduled for September
2027.
In January this year, we announced that we would step up our buyback policy with the intention of
maintaining the discount in single figures in normal market conditions. Since then, conditions have
hardly been normal at all, but the discount has come in, to 10.5% at the year end and to 9.9% at the
time of writing.
All this comes while the Company still benefits from low fees: the management fee of 0.5% is low for
an active portfolio and the ongoing charges ratio of 0.71% stands up well against competitor funds both
closed-ended and open-ended. The ability to gear (or borrow to enhance returns) is another positive
factor. The amounts borrowed are managed day-to-day by the portfolio managers and are a good
reflection of their optimism about the underlying portfolio. Overall limits are set by the Board.
The Directors are all acutely aware that the Company remains in a recovery situation. We will continue
to do all we can to enhance shareholder returns. We know we need to demonstrate clear progress by the
time of the next continuation vote. But we also know that we are sitting on a Company of enormous
potential: The UK market as a whole is widely regarded as unusually cheap both by comparison with
its own history and with global markets. That alone is a case for optimism. If growth stocks start to
outperform, either because they are so cheap already or because UK economic growth accelerates from
its very low current levels, then the Baillie Gifford tailwind should be felt again. And if all this
coincides with investment trust discounts reverting to normal levels, then the case for BGUK is
compelling. Especially given the each-way bet of the 5-year 100% performance conditional tender
offer.
We look forward with confidence.
Update
Since 30 April to 10 June 2025, the Company’s share price and NAV total return have been 9.7% and
8.7% respectively versus 5.3% for the FTSE All-Share Index total return. A further 1,623,033 shares
have been bought back and the discount stands at 9.9%.
Neil Rogan
Chairman
12 June 2025
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Managers’ Report
After an encouraging period of performance in 2024, the opening months of 2025 were characterised
by significant volatility, driven by geopolitical tensions, inflationary concerns and cautious investor
sentiment. Investors, therefore, gravitated towards defensive, value-oriented sectors, while high-growth
stocks struggled despite strong fundamentals in many cases. We are disappointed to report that the
outperformance we noted in the interim report was erased in the second half of the Company’s
financial year, so that we ended marginally behind the index for the twelve months to 30 April 2025.
At the heart of this were some of the actions and comments from President Trump in regard to tariffs.
This could be an essay in itself, but for the purposes of this Managers’ Report it’s enough to say that
it’s difficult to assess the long-term implications of his actions and intentions. Indeed, even if some of
his proposals are moderated or reversed, it’s hard to think that there won’t be damage caused to trading
relationships. In the short term it has certainly shaken the confidence of consumers and also businesses.
Delaying investment or purchasing decisions given the uncertainty at an individual level might appear
understandable, but if aggregated and prolonged, this could prove damaging to short-term economic
prospects.
Closer to home, the new Labour Government has been unable, so far at least, to shake off its initial
faltering steps and the frankly uninspiring narrative has been made no easier with events outside their
control in the form of increasing concerns about the health of the global economy. With the domestic
economy still unable to break out of its low growth trajectory with higher business taxes looming,
consumer confidence has remained low, with cost-of-living pressures curbing discretionary spending.
The Chancellor’s Spring Statement did emphasise fiscal restraint but also lowered the UK growth
forecast from 2% to 1%. It’s important to remember that many of our businesses are only marginally
impacted by this but a fair number are seeing a tougher demand backdrop despite their long-term
strengths and growth potential.
Indeed, when discussing performance, what was striking in the period was the range of performance of
stocks within our concentrated portfolio of 37 companies (36 listed and 1 private). Normally, when
performance is close to the benchmark, one would reasonably imagine that most stocks would be
grouped in a tightish band around the index and there’d be a few outliers (good and bad) beyond that.
This wasn’t the case in this period. Instead, we saw a picture of extremes: for example the shares of the
six largest holdings in the portfolio at the year end: Games Workshop, Autotrader, Volution Group,
Experian, Wise and AJ Bell, all performed very well reflecting for the most part good underlying
operational performance in each of these very different businesses. There were a fair few others that
are smaller positions which also saw similar positive share price performance such as Just Group,
Moonpig and Rightmove. In contrast, Howden Joinery was the only one of our top ten holdings that
underperformed. However, there were also a notable number of other holdings in the portfolio that
performed extremely poorly. It’s here that we get to the heart of the matter as it helps explain the more
difficult performance of the second half because most of these stocks were economically sensitive
businesses such as 4imprint, Inchcape, Ashtead, Renishaw, Bodycote and Page Group. There were also
some company specific problems that hurt Diageo, Bunzl and Kainos.
The key debate for a long-term investor is whether a share price setback is indicative of something
going fundamentally wrong with the business or whether it is a temporary or cyclical issue. In all of the
above cases, we’ve carefully thought about this and for the most part other than some modest additions
and trims, we’ve largely stuck with the same positions. This is because we believe that these businesses
have the operational and balance sheet strength, alongside sensible management teams, to weather the
storms and come through in even better shape. For example, it will be no surprise to any reader that the
UK kitchen market has been a tough place in the last couple of years but while its short term financial
results are off their peak, Howdens Kitchens is outperforming the kitchen market and, crucially in our
view, still investing in its manufacturing, logistics, store refurbishment and new openings as well as
launching new product ranges. In our view, this is an example of a business having the conviction to do
the right things in tough times to position the business for an even brighter future when better times
return. In Howdens’ case, it is particularly laudable as, unlike some of our technology or ‘platform’
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investments, it does not earn particularly high profit margins, albeit it has the safety net of a very
strong balance sheet.
In terms of trading, we made no new purchases in the second half of the Company’s year. We did
decide to add to positions in Moonpig as we think the market is still underestimating the potential of
this online card retailer. We also added to 4imprint, a direct marketer of promotional products, where
the shares have been derated on US economic fears but where we think this tougher environment
actually allows its scale and superior management to lay the groundwork, as in previous downturns, to
strengthen their growth potential when the US economy recovers. On the other side, we sold out of the
insurer Hiscox, the miner Rio Tinto and modestly reduced positions in a few stocks such as Relx,
Games Workshop, Ashtead and Bunzl. While we have a high opinion of the management of Hiscox,
we have been disappointed by the lack of growth in its retail business while we simply felt with Rio
Tinto that the demand backdrop looked dull.
It should be emphasised that much of this selling activity was a result of the Company’s new buyback
policy that led to an acceleration of shares purchased in the second half of the Company’s year.
As managers we could simply have prorated sales across the whole portfolio but with the backing and
encouragement of the Board we have tried to apply a ‘competition for capital’ mindset and decided to
reduce or sell those investments either where we had a lower degree of conviction or in cases of Relx
and Games Workshop where we retain our enthusiasm, but acknowledged the shares have performed
very well and the valuation was more demanding. In a concentrated portfolio this seemed to us to be a
more logical step than potentially reducing holdings where we retain strong conviction. That said, at
the period end we were close to the lower end of our 35 – 65 range of companies so we can’t rule out a
slightly different approach in the future.
Outlook
The last few years have vividly demonstrated that ‘stuff happens’ far more frequently than any
model would predict. Whatever the reasons for that, the effect of appearing to live in a world
‘permanently in fast forward’ can be dizzying, disorientating, exciting and slightly alarming at times.
Trying to unpick this, the problem is often evaluating whether current concerns are transitory or
genuinely seismic. We’d humbly posit that far more fall into the former category than the market or
commentators would have you believe. However, it’s vital also to remember that for nimble, far
sighted management teams, uncertain times can be a source of great opportunity too. For us, it helps
immeasurably having the discipline of a clear investment framework of growth investing that allows us
to keep evaluating the fundamental quality of the portfolio and to search for new opportunities without
getting sucked into distractions. That we have continued to stick with most of the holdings over the
year is testament to a lot of time spent with businesses genuinely trying to evaluate their prospects.
While we are very aware that long term performance needs to improve, we remain highly encouraged
by the potential of the companies in the portfolio and remain optimistic about its future prospects.
Iain McCombie and Milena Mileva
Baillie Gifford & Co
12 June 2025
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The managers’ core investment principles
Investment philosophy
The following are the three core principles underpinning our investment philosophy. We have
a consistent, differentiated long-term investment approach to managing UK equities that should
stand investors in the Company in good stead:
Growth
We search for the few companies which have the potential to grow substantially and profitably
over many years. Whilst we have no insight into the short-term direction of a company’s share price,
we believe that, over the longer term, those companies which deliver above average growth in cash
flows will be rewarded with above average share price performance and that the power of
compounding is often under-appreciated by investors. Successful investments will benefit from a rising
share price and also from income accumulated over long periods of time.
Patience
Great growth companies are not built in a day. We firmly believe that investors need to be patient
to fully benefit from the scale of the potential. Our investment time horizon, therefore, spans decades
rather than quarters and our portfolio turnover is significantly below the UK industry average. This
patient, long-term approach affords a greater chance for the superior growth and competitive traits of
companies to emerge as the dominant influence on their share prices and allows compounding to work
in the investors’ favour.
Active investment management
It is our observation that too much attention is paid to the composition of market indices and active
managers should make meaningful investments in their best ideas regardless of the weightings of the
index. As a result, shareholders should expect the composition of the portfolio to be significantly
different from the benchmark and hence the outcome in returns (in both good and bad periods) will
also be significantly different from the benchmark. This differentiation is a necessary condition for
delivering superior returns over a long-term time horizon.
Portfolio construction flows from the investment beliefs stated above.
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Baillie Gifford’s stewardship principles
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.
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 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 if that
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.
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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 a policy.
A broad cross section of our investment staff are involved 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 our 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. Voting
activity and the reasons for any resolutions voted against in the period is disclosed on the Company
website and can be viewed at bgukgrowthtrust.com.
Company meeting record
PIE CHART
Voting distribution
PIE CHART
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Environmental, social and governance engagement
By engaging with companies, we 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 four following examples
demonstrate our stewardship approach through constructive, ongoing engagement.
Burberry
Objective
Following meetings with various members of the board last year relating to the unexpected change of
chief executive (CEO) to Josh Schulman, we joined a call with Gerry Murphy, chair, to receive an
update on how the CEO has settled in and on other management changes.
Discussion
We have met Mr Schulman a couple of times since his appointment and noted the clarity and
consistency of his messaging on his intentions for Burberry, which has been well-received. The chair
echoed this sentiment, highlighting the stability and clarity he has brought to the company. The focus is
now on successful execution which will take time to bear fruit. However, Mr Schulman has acted
swiftly and decisively in areas where changes can be made quickly such as marketing and building the
management team.
Significant management changes include the appointments of Jonathan Kiman as Chief Marketing
Officer and Paul Price as Chief Product Officer, both of whom are collaborating effectively with Josh
and Daniel Lee, the Chief Creative Officer. Board changes were also discussed, with Stella King
joining as a non-executive director (NED), bringing extensive luxury industry experience as former
President of Asia Pacific at Moncler. Meanwhile, NEDs Fabiola Raquel Arredondo de Vara and
Antoine Jean Bernard de Saint-Affrique will step down. Antoine’s departure is due to over-boarding
concerns, as he has taken on additional responsibilities elsewhere.
Outcome
Although it’s still early days, the meeting provided assurance about the new CEO’s leadership and the
dynamics of the new management team so far. We will continue to monitor the evolution of the board
and management, and success in executing the company’s strategy.
Prudential
Objective
We have met with Prudential several times over the past three months including two meetings with
Diane Guzman, the chief sustainability officer, and the environmental, social and governance (ESG)
team, as well as our annual meeting with chair Baroness Vadera. Chief executive (CEO) Anil
Wadhwani has now completed his second year with the company, so these meetings gave us a chance
to reflect on how the company’s strategy is developing, particularly from an ESG perspective.
Discussion
Share price performance has been a continued disappointment for Prudential and this is frustrating for
the team. With the low share price comes the temptation to conduct share buybacks, but chair Vadera
noted the importance of maintaining franchise value through continued investment, rather than purely
tracking the share price, a sentiment we fully agree with. Historic pressures to pay dividends have
resulted in underinvestment in various regions. However, Wadhwani is starting to address this, notably
in Indonesia and China, where he has emphasised the important presence on the ground beyond the
CITIC team (Prudential’s equal joint venture partner in China).
Another change under Wadhwani has been the recruitment of Guzman as head of sustainability. She
has led various environmental initiatives looking at the ‘Just Transition’ and how climate impact
should be considered in investments held in Asian markets. She is also increasingly interested in the
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link between climate change and health outcomes. Consequently, Prudential is sponsoring academic
research on this area to support commercial efforts in underwriting to link morbidity to climate related
diseases. Efforts in accessible insurance, which have been signalled in the company’s ‘Purpose
Statement’ are at a sandbox stage and Guzman is focused on proving their commercial viability. If such
products do prove to be viable, they could increase the target market which Prudential could work with
in many of its lower income geographies.
Outcomes
Share price performance may be disappointing, but we are pleased to see that the team are reinvesting
in the company and increasing their regional focus. There are many initiatives underway in the ESG
space, and it is important to recognise that a commercial focus underpins these – we think this gives
them the best chance of success. We look forward to seeing how a continued focus on long-term
opportunities plays out in the years to come.
Games Workshop
Objective
To assess the evolution of the board and management development plans.
Discussion
We had a call with the CEO, Kevin Rountree, who has been at Games Workshop for 26 years,
including a highly successful decade in his current role. This engagement followed our site visit to
Nottingham, that the CEO had been unable to attend. During the visit, we met with key members of
senior management, including the retiring CFO and her successor, Liz Harrison, an internal
appointment. This follow up call allowed us to provide feedback to the CEO about our visit, including
our support for the CFO appointment. We also met with key management team members below board
level, and we were keen to understand from Mr Rountree the steps being taken to develop their roles in
the business. We were pleased to hear that the CEO has been progressing with plans to widen their
responsibilities and extend their management experience. This progression is significant at Games
Workshop, where the culture has resulted in the long tenure of most employees. Developing the bench
strength below the board level would provide internal candidates should new board opportunities open.
This approach would most likely support the continuation of the company’s culture. We also discussed
the search for a new chair.
Outcome
Since our call Mark Lam, who has been the Senior Independent Director, has been appointed as chair.
Randal Casson, a non-executive, will succeed him as Senior Independent Director. We have now met
with Mr Lam and the two serving non-executives and are pleased that consideration is being given to
how best to develop the board to support the international ambitions of the company.
15
Review of Investments
A review of the Company’s ten largest investments as at 30 April 2025
Games Workshop
Miniature gaming company, known for its fantasy game, Warhammer. Its excellent competitive
position translates into strong pricing power and high margins. We believe its addressable market is
expanding as the hobby gains popularity in the US & Far East. It is also focused on monetising its deep
pool of intellectual property across the broader media space, as evidenced by its recent TV/film
partnership with Amazon.
Sector
Consumer Discretionary
Valuation at 30 April 2025
£21,376,000
% of total assets*
7.5
Valuation at 30 April 2024
£14,735,000
% of total assets*
4.9
Net purchases/(sales) in year to 30 April 2025
(£1,460,000)
Volution Group
Manufacturer of ventilation products which range from simple extractor fans to more complex heat
recovery solutions. Its products are very well-positioned to benefit from environmental regulation in
building and construction. For instance, its heat recovery ventilation solutions are already helping
customers to meet new energy efficiency building standards. This is a promising tailwind that could
boost organic growth for years to come.
Sector
Industrials
Valuation at 30 April 2025
£18,177,000
% of total assets*
6.4
Valuation at 30 April 2024
£13,946,000
% of total assets*
4.7
Net purchases/(sales) in year to 30 April 2025
–
Auto Trader Group
Dominant advertising portal for used cars in the UK. Through its large audience of UK car buyers and
the continuous development of its unparalleled automotive data assets, Auto Trader is becoming ever
more deeply embedded in the workflows of retailers. The company has significantly stepped up its
efforts to evolve from an advertising to a transactional platform, providing a superior buying
experience to consumers and helping retailers become more efficient.
Sector
Technology
Valuation at 30 April 2025
£18,103,000
% of total assets*
6.4
Valuation at 30 April 2024
£15,065,000
% of total assets*
5.0
Net purchases/(sales) in year to 30 April 2025
-
Experian
Credit analytics and data provider. It enables businesses to form an opinion on the creditworthiness of
potential customers and helps consumers to understand and improve their ability to borrow. It also
protects businesses and individual customers against fraud and identity theft. We see Experian as
exceptionally well-placed to benefit from the relentless trend towards the digitisation of all aspects of
both consumer and corporate life.
16
Sector
Industrials
Valuation at 30 April 2025
£15,255,000
% of total assets*
5.4
Valuation at 30 April 2024
£14,798,000
% of total assets*
4.9
Net purchases/(sales) in year to 30 April 2025
(£1,759,000)
Wise
Global FX transfer company. Having recognised that the process of transferring money abroad is
expensive, slow, opaque and inconvenient, Wise is on a mission to improve the process for both
individual consumers and businesses. Wise’s strong customer proposition provides the potential for a
long run way for continued market share gains in what is a large, global, cross-border market.
Sector
Industrials
Valuation at 30 April 2025
£13,331,000
% of total assets*
4.7
Valuation at 30 April 2024
£10,577,000
% of total assets*
3.5
Net purchases/(sales) in year to 30 April 2025
–
AJ Bell
One of the UK’s leading online investment platforms. As long-term savings in the UK shift from
corporate defined benefit schemes towards more self-directed defined contribution schemes, online
investment platforms should benefit. With its scale and competitive customer service and pricing,
AJ Bell stands out as one of the likely long-term winners.
Sector
Financials
Valuation at 30 April 2025
£12,445,000
% of total assets*
4.4
Valuation at 30 April 2024
£9,533,000
% of total assets*
3.2
Net purchases/(sales) in year to 30 April 2025
–
Howden Joinery
Manufacturer and supplier of kitchens to small builders/property developers in the UK. Its
decentralised, customer-centric business model has proved very successful and it is very well-
positioned to continue to take market share. It has a compelling customer proposition which combines
local depots in convenient locations, high stock-availability and good customer service. It also has a
long-term opportunity to replicate its successful model in the less mature French market.
Sector
Consumer discretionary
Valuation at 30 April 2025
£11,061,000
% of total assets*
3.9
Valuation at 30 April 2024
£12,600,000
% of total assets*
4.2
Net purchases/(sales) in year to 30 April 2025
–
Just Group
Provider of individual and bulk annuities. Just Group has successfully diversified from individual
annuities into the bulk market and has been a beneficiary of higher interest rates which have reduced
pension scheme liabilities and driven more pension schemes to ‘buy out’. We believe demand should
remain strong in this area for years to come and that Just Group will be a beneficiary.
17
Sector
Financials
Valuation at 30 April 2025
£11,010,000
% of total assets*
3.9
Valuation at 30 April 2024
£8,113,000
% of total assets*
2.7
Net purchases/(sales) in year to 30 April 2025
–
Softcat
Leading distributor of IT solutions. This is first and foremost a relationship business, and Softcat
differentiates itself through the quality of service provided by its highly engaged employees, who share
in the success of the business. Its business model and culture set it apart from its peers, and its scale
and investments in developing its capabilities add to a sustainable competitive advantage.
Sector
Technology
Valuation at 30 April 2025
£10,352,000
% of total assets*
3.6
Valuation at 30 April 2024
£9,720,000
% of total assets*
3.2
Net purchases/(sales) in year to 30 April 2025
–
St. James’s Place
The UK’s largest wealth manager. St James’s Place (SJP) is a beneficiary of the move to more self-
directed investment decisions for UK-based savers, most notably those saving for retirement. This
tailwind should persist for decades to come. SJP targets affluent customers, and controls its distribution
through selling via an experienced self-employed sales force whilst outsourcing the management of its
funds to third parties. This allows the company to capture more profit margin whilst delivering an
attractive proposition to customers, which is reflected in growing funds under management and high
levels of customer retention.
Sector
Financials
Valuation at 30 April 2025
£10,070,000
% of total assets*
3.5
Valuation at 30 April 2024
£4,668,000
% of total assets*
1.5
Net purchases/(sales) in year to 30 April 2025
–
18
List of investments
as at 30 April 2025
Name
Business
Fair value
£’000
% of total
assets
Consumer discretionary
Games Workshop
Toy manufacturer and retailer
21,376
7.5
Howden Joinery
Manufacturer and distributor of kitchens to trade
customers
11,061
3.9
Moonpig
Online greetings card and gifting platform
9,836
3.5
4imprint
Direct marketer of promotional merchandise
7,444
2.6
Inchcape
Car wholesaler and retailer
6,579
2.3
Burberry
Luxury goods retailer
2,891
1.0
59,187
20.8
Consumer staples
Diageo
International drinks company
5,948
2.1
Applied Nutrition
Producer of premium nutrition supplements
1,104
0.4
7,052
2.5
Financials
AJ Bell
UK wealth manager
12,445
4.4
Just Group
Provider of retirement income products and
services
11,010
3.9
St. James’s Place
UK wealth manager
10,070
3.5
Legal & General
Insurance and investment management company
9,143
3.2
Prudential
International life insurer
7,300
2.6
Lancashire Holdings
General insurance
6,804
2.4
IntegraFin
Provides platform services to financial clients
5,970
2.1
Molten Ventures
Technology focused venture capital firm
3,456
1.2
66,198
23.3
Healthcare
Genus
World leading animal genetics company
7,365
2.6
Creo Medical
Designer and manufacturer of medical
equipment
449
0.2
Oxford Nanopore
Novel DNA sequencing technology
368
0.1
8,182
2.9
Industrials
Volution Group
Supplier of ventilation products
18,177
6.4
Experian
Global provider of credit data and analytics
15,255
5.4
Wise
Online platform to send and receive money
13,331
4.7
Halma
Specialist engineer
8,840
3.1
Ashtead
Construction equipment rental company
5,759
2.0
Renishaw
World leading metrology company
5,716
2.0
Bunzl
Distributor of consumable products
5,475
1.9
Bodycote
Heat treatment and materials testing
4,425
1.6
PageGroup
Recruitment consultancy
2,937
1.0
FDM Group
Provider of professional services focusing on
information technology
1,757
0.6
81,672
28.7
Real estate
Rightmove
UK’s leading online property portal
7,846
2.7
Helical
Property developer
3,920
1.4
11,766
4.1
19
Name
Business
Fair value
£’000
% of total
assets
Technology
Auto Trader Group
Advertising portal for second hand cars in the
UK
18,103
6.4
Softcat
IT reseller and infrastructure solutions provider
10,352
3.6
Kainos Group
IT services and implementer
6,679
2.3
RELX
Professional publications and information
provider
6,448
2.3
Wayve Technologies Ltd
Series B Pref.
U
Developer of full autonomous driving systems
3,757
1.3
First Derivatives
IT consultant and software developer
3,561
1.3
48,900
17.2
Total Equities
282,957
99.5
Net Liquid Assets
1,480
0.5
Total Assets
284,437
100.0
U
Denotes unlisted (private company) investment.
20
One year summary
30 April 2025
30 April 2024
% change
Shareholders' funds
£260m
£283.2m
Net asset value per share
201.2p
193.0p
4.2
Share price
180.0p
163.5p
10.1
FTSE All-Share Index
3.7
Revenue earnings per ordinary share
5.32p
5.68p
(6.3)
Dividends paid and payable in respect of the year
5.70p
5.60p
1.8
Ongoing charges*
0.71%
0.70%
Discount*
(10.5%)
(15.3%)
Active share*
89%
87%
Investment gearing*
9%
5%
Year to 30 April
2025
2024
Total returns (%)*
Net asset value
7.1
0.6
Share price
13.6
(0.5)
FTSE All-Share Index
7.5
7.5
Year to 30 April
2025
2025
2024
2024
Year’s high and low
High
Low
High
Low
Net asset value per share
219.2p
175.2p
201.7p
165.6p
Share price
196.5p
158.5p
173.4p
141.8p
Discount*
(8.5%)
(16.5%)
(12.0%)
(16.6%)
30 April 2025
30 April 2024
Net return per ordinary share
Revenue
5.32p
5.68p
Capital
6.72p
(5.42p)
Total
12.04p
0.26p
For a definition of terms see Glossary of Terms and Alternative Performance Measures on pages 100 to 102.
* Alternative performance measure – see Glossary of Terms and Alternative Performance Measures on pages 100 to 102.
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 99.
Past performance is not a guide to future performance.
21
Five year summary
The following charts indicate how an investment in Baillie Gifford UK Growth Trust has
performed relative to its benchmark and its underlying net asset value over the five year period
to 30 April 2025.
Five year total return* performance
(figures rebased to 100 at 30 April 2020)
GRAPH
(Discount)/premium* to net asset value
(figures plotted on a monthly basis)
GRAPH
Annual change in net asset value and share price
GRAPH
Annual net asset value and share price total returns*
(relative to the benchmark† total returns)
GRAPH
* Alternative performance measure – see Glossary of Terms and Alternative Performance Measures on pages 100 to 102.
† The benchmark is the FTSE All-Share Index.
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 99.
Past performance is not a guide to future performance.
22
Ten year record
Capital
At
30 April
Total assets
£’000
Borrowings
£’000
Shareholders’
funds
£’000
Net asset
value per share
p
Share price
p
(Discount)/
premium *
%
2015
298,837
–
298,837
185.7
167.0
(10.1)
2016
274,880
–
274,880
171.4
152.9
(10.8)
2017
304,372
–
304,372
195.6
168.5
(13.9)
2018
324,252
12,000
312,252
207.5
187.5
(9.6)
2019
305,735
–
305,735
203.1
192.0
(5.5)
2020
263,659
–
263,659
175.2
161.5
(7.8)
2021
365,503
2,450
363,053
237.3
244.0
2.8
2022
309,383
6,450
302,933
197.4
174.2
(11.8)
2023
308,872
14,450
294,422
195.6
168.0
(14.1)
2024
299,503
16,350
283,153
193.0
163.5
(15.3)
2025
284,437
24,350
260,087
201.2
180.0
(10.5)
Revenue
Gearing ratios
Year to
30 April
Gross
revenue
£’000
Available
for ordinary
shareholders
£’000
Revenue
earnings per
ordinary
share
p
Dividends
paid and
proposed per
ordinary
share
p
Ongoing
charges
ratio *
%
Invested
gearing *
%
Drawn
gearing *
%
2015
10,372
9,475
5.89
6.00 †
0.47
(4)
–
2016
9,839
9,262
5.77
5.20
0.32
(2)
–
2017
10,069
9,248
5.83
5.40
0.62
(1)
–
2018
10,980
10,099
6.58
6.00
0.63
3
4
2019
8,658
7,710
5.12
4.45
0.51 #
(1)
–
2020
6,562
5,644
3.75
3.10
0.66
(1)
–
2021
5,297
4,351
2.88
2.42
0.65
–
1
2022
7,787
6,737
4.39
3.91
0.63
2
2
2023
7,260
6,145
4.05
3.60
0.70
3
5
2024
9,787
8,484
5.68
5.60
0.70
5
6
2025
8,893
7,468
5.32
5.70
0.71
9
9
Source: Baillie Gifford/LSEG. See disclaimer on page 99.
See Glossary of Terms and Alternative Performance Measures on pages 100 to 102.
* Alternative performance measure – see Glossary of Terms and Alternative Performance Measures on pages 100 to 102.
† Includes a special dividend of 1.00p per ordinary share.
# Baillie Gifford & Co Limited was appointed Manager in 2018 and agreed to waive the management fee for the year ended 30 April 2019
to the extent
of £732,000. Without the management fee waiver, the ongoing charges for the year to 30 April 2019 would have been 0.76%.
23
Cumulative Performance (taking 2015 as 100)
At
30 April
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
92
96
92
95
91
94
98
87
2017
105
112
101
108
105
113
99
90
2018
112
122
112
125
110
123
112
100
2019
109
123
115
131
108
126
87
74
2020
94
108
97
112
87
105
64
52
2021
128
148
146
172
106
132
49
40
2022
106
124
104
124
111
143
75
65
2023
105
126
101
122
114
152
69
60
2024
104
127
98
122
118
164
96
93
2025
108
135
108
138
122
176
90
95
Compound annual returns
5 year
2.8%
4.7%
2.2%
4.3%
7.1%
10.9%
7.2%
13.0%
10 year
0.8%
3.1%
0.8%
3.3%
2.0%
5.8%
(1.0%)
(0.5%)
Ten year total return* performance
GRAPH
Source: Baillie Gifford/LSEG and relevant underlying index providers. See disclaimer on page 99.
* Alternative performance measure – see Glossary of terms and Alternative Performance Measures on pages 100 to 102.
† FTSE All-Share Index.
Past performance is not a guide to future performance
24
Business review
Business model
Business and status
Baillie Gifford UK 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 HM Revenue & 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
The principal investment objective of the Company is to achieve capital growth predominantly from
investment in UK equities, with the aim of providing a total return in excess of the FTSE All-Share
Index.
Investment policy
The Company invests in a portfolio of between 35 and 65 companies selected for their potential to
provide, in aggregate, attractive returns relative to the total return of the FTSE All-Share Index.
The portfolio is invested primarily in listed equities but may also invest in unlisted investments,
including private companies, convertible securities, and equity-related derivatives.
On acquisition of any unlisted investment, the Company’s aggregate holding in unlisted investments
shall not exceed 10% of the total asset value of the Company.
The Company may also use derivatives for efficient portfolio management purposes.
The majority of investments are constituents of the FTSE 350 Index although constituents of other UK
FTSE indices may be held.
The Company is also permitted to make investments outside of the UK where these investments have a
meaningful connection with the UK.
The size of individual stock holdings depends on the Managers’ degree of conviction, not the stock’s
weight in any index.
The Company may not invest more than 15% of its total assets in any one single company measured at
the time of investment.
The maximum permitted investment in other listed investment companies (including investment trusts)
is 10% of total assets at the time of purchase unless such companies have a stated investment policy
not to invest more than 15% of their total assets in other listed investment companies, in which case the
limit is 15%.
The level of gearing within the portfolio is agreed by the Board and the absolute amount of any gearing
should not exceed 20% of the net asset value of the Company at the time of drawdown.
The Company can also hold up to 20% of total assets in cash or cash equivalents.
25
Key performance indicators
At each Board meeting, the Directors consider a number of performance measures to assess the
Company’s success in achieving its objectives. The Board uses key performance indicators
(KPIs) to measure the progress and performance of the Company over time when discharging its
duties. These KPIs are established industry measures.
Share price, net asset value and comparative index
†
total returns*
The total return is the return to shareholders after reinvesting the net dividend on the date that the share
price goes ex-dividend.
CHART
Share price (discount)/premium*
As stock markets and share prices vary, an investment trust’s share price is rarely the same as its net
asset value (NAV). When the share price is lower than the NAV per share it is said to be trading at a
discount. If the share price is higher than the NAV per share, this situation is called a premium.
CHART
Ongoing charges*#
Ongoing charges are 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.
CHART
The Board also has regard to the management fee and to 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.
Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 99.
* Alternative Performance Measure – see Glossary of terms and Alternative Performance Measures on pages 100 to 102.
† The benchmark is the FTSE All-Share Index.
# Baillie Gifford & Co Limited was appointed Manager in 2018 and agreed to waive the management fee for the year ended 30 April 2019
to the extent of £732,000. Without the management fee waiver, the ongoing charges for the year to 30 April 2019 would have been 0.76%.
Past performance is not a guide to future performance.
26
Borrowings
The Company has a one year £30 million unsecured revolving credit loan facility with The Royal Bank
of Scotland International Limited which is due to expire on 5 July 2025 and negotiations are underway
to replace this facility. At 30 April 2025, £24,350,000 had been drawn down (2024 – £16,350,000).
Further details of the Company’s borrowings are set out in note 11 on page 81.
Principal and emerging risks
As explained on pages 51 and 52 there is an ongoing process for identifying, evaluating and managing
the risks faced by the Company on a regular basis. The Directors have carried out a robust assessment
of the principal and emerging risks facing the Company, including those that would threaten its
business model, future performance, regulatory compliance, solvency or liquidity. A description of
these risks and how they are being managed or mitigated is set out below. There have been no
significant changes to the nature of the principal risks during the year. An upwards arrow, dash or
downwards arrow has been included to show if the risk level has increased, not changed or decreased
since it was reported in last year’s Annual Report and Financial Statements.
The Board considers heightened macroeconomic and geopolitical concerns to be factors which
exacerbate existing areas of risk as categorised and further explained below.
Financial
risk
What is the risk?
The Company’s assets
consist predominately of
listed securities and its
principal and emerging 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
18 on pages 83 to 87.
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. To
monitor and, where possible,
mitigate these risks the Board
considers at each meeting
various portfolio metrics
including individual stock
performance, the composition
and diversification of the
portfolio by sector, purchases
and sales of investments and
the top and bottom
contributors to performance.
The Managers provide
rationale for stock selection
decisions. A strategy meeting
is held annually.
Rating
and
change
─
Current assessment of risk
Risk level: High
This risk is unchanged and
remains high due to
high
levels of market volatility as
a result of heightened
geopolitical concerns and the
threat to trade from increased
protectionism.
Investment
strategy risk
What is the risk?
Pursuing 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, a decreased
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 raise any
matters of concern with the
Managers.
Rating
and
change
─
Current assessment of risk
Risk level: High
This risk remains high as the
market’s appetite for growth
stocks, typically held by the
Company, declined during
the recent period of
heightened macroeconomic
and geopolitical concern.
27
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
Board
monitors 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 its
shareholders.
Rating
and
change
─
Current assessment of risk
Risk level: High
The Company’s shares
continued to trade at a
discount. In the year to
30
April 2025, the
Company
bought back
17,403,697
shares. In January
2025, the Board determined
to use buybacks to endeavour
to maintain a s
ingle digit
discount, in normal
market
conditions.
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
Investment Manager 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
Investment Managers’
thorough ESG stewardship
and engagement policies,
which are available to view
on the Managers’ website:
bailliegifford.com and have
been reviewed and endorsed
by the Company, and are
fully integrated into the
investment process as well as
the extensive upfront and
ongoing due diligence which
the Investment Managers
undertake on each investee
company. This due diligence
includes assessment of the
risks inherent in climate
change (see page 54). The
Directors have considered the
impact of climate change on
the Financial Statements of
the Company and this is
included in note 1 to the
Financial Statements on page
75.
Rating
and
change
─
Current assessment of risk
Risk level: Moderate
The Investment Manager
continued to employ strong
ESG stewardship and
engagement policies.
28
Regulatory
risk
What is the risk?
Failure to comply with
applicable legal and
regulatory requirements such
as t
he tax rules for
investment companies, the
FCA 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, Baillie
Gifford’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 w
ith reference to
inside information.
Rating
and
change
─
Current assessment of risk
Risk level: Low
All control procedures were
working effectively and there
were no material regulatory
changes that have impacted
the Company during the year.
Custody and
d
epositary
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.
The
Custodian’s assured
internal controls reports are
r
eviewed 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
Risk level: Low
All control procedures were
working effectively.
29
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 or major disaster.
The Audit Committee
reviews Baillie Gifford’s
Report on Internal Controls
and the 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
Risk level: Low
All control procedures were
working effectively.
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 va
lue,
any borrowings will magnify
the impact of this loss. If
borrowing facilities are not
renewed, or loan covenants
are breached, the Company
may have to sell investments
to repay borrowings.
How is it managed?
To mitigate this risk, all
borrowing facilities 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
Company’s investments are
predominately in
listed
securities, at present, that
are
readil
y realisable.
Further
information on
leverage can be found on
page 99 and in the Glossary
of terms and Alternative
Performance Measures on
pages 100 to 102.
Rating
and
change
─
Current assessment of risk
Risk level: Low
The willingness of lenders to
initia
te and maintain lending
facilities has improved.
Current borrowings are well
below levels where loan
covenants may be breached.
The current one year, £30m
revolving credit facility
expires in July 2025 and
negotiations are underway to
replace this facility.
Political
risk
What is the risk?
Political change in areas in
which the Company invests
or may invest may have
practical consequences for
the Company.
How is it managed?
Political developments are
monitored and considered by
the Board. The Board
contin
ues to assess the
potential consequences for
the Company’s future
activities including those that
may arise from growing
protectionism. The Board
also remains watchful of
broader geopolitical tensions.
Rating
and
change
─
Current assessment of risk
Risk le
vel: High
This risk remains high as
governments and consumers
around the world continue to
assess the impact of
heightened geopolitical
tensions.
30
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.
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. Baillie Gifford’s
Business Risk Department
report to the Audit
Committee on the
effectiveness of information
security controls in place at
Baillie Gifford and its
business continuity
framework. 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
Risk level: Moderate
This risk remains moderate as
the continuation of
geopolitical tensions could
lead to 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 a
cyber security
threat.
Emerging
risks
As explained on pages 51 and 52, the Board has regular discussions on principal risks and uncertainties,
including any risks which are not an immediate threat but could arise in the longer term. The Board
considers that the key emerging risks arise from the interconnectedness of the global economy and the
related exposure of the investment portfolio to external and emerging threats such as the societal and
financial implications of an escalation of geopolitical tensions, cyber security risks including developing
AI and quantum computing capabilities, new coronavirus variants or similar public health threats. The
Board also notes that increased levels of government borrowing may result in an elevated level of
interest rates and/or
increased market volatility. This is mitigated by the Board discussing at each Board
meeting economic and geopolitical factors and how these might impact the Company. The Board also
considers the Investment Managers’ close links to the investee companies and their ability to ask
questions on contingency plans. The
Investment Managers believe the impact of such events may be to
slow the pace of growth rather than to invalidate the investment rationale over the long term. The
Managers monitor certain emerging risks and have established a group to manage the response to any
future events that might result in heightened levels of market vol
atility. Regular exercises are carried out
to test the Managers’ response to various scenarios.
↑ Increasing Risk ↓ Decreasing Risk ─ Stable Risk
31
Viability statement
Notwithstanding that the continuation of the Company is subject to approval by shareholders every five
years, with an additional continuation vote to be held in 2027 and the next regular vote in 2029, the
Directors have, in accordance with provision 31 of the UK Corporate Governance Code, 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. Furthermore, 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, including climate change, detailed on pages 30 to
33 and in particular the impact of market risk where a significant fall in UK equity markets would
adversely impact the value of the investment portfolio. The vast majority of the Company’s
investments are listed and readily realisable and can be sold to meet its liabilities as they fall due. The
Directors have also considered the Company’s leverage and liquidity in the context of the unsecured
revolving credit loan facility of £30 million expiring in July 2025, which had £24,350,000 drawn down
at 30 April 2025 and £24,350,000 drawn down as at 12 June 2025. Negotiations are underway to
replace this facility. Specific leverage and liquidity stress testing was conducted during the year,
including consideration of the risk of further market deterioration resulting from heightened
macroeconomic and geopolitical concerns. 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 subject to passing the continuation votes at the Annual General Meetings in 2027 and
2029.
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 and having regard to the Company being an externally-managed investment company
with no employees, the Board considers that the Company’s key stakeholders are its existing and
potential new shareholders, its externally-appointed managers (Baillie Gifford) and other professional
service providers (corporate broker, registrar, auditor and depositary), lenders, wider society and the
environment.
32
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
Shareholders
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.
Great importance is placed by the Board on
communication with
shareholders and the Annual
General Meeting provides the
key forum for the Board
and Managers to present to shareholders on the
performance of the Company and on the future
plans/prospects for the Company (see Notice of Meeting
on page 89). It also allows shareholders the opportunity
to meet with the Board and Managers and to raise
questions and concerns. The Chairman is available to
meet with shareholders as appropriate and the Managers
meet regularly with shareholders and their respective
representatives, reporting back on views to the Board.
Shareholders may also communicate with the Board at
any time by writing to them at the Company’s registered
office, writing to the Company’s broker or emailing the
Managers at enquiries@bailliegifford.com. 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 have
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.
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 Investment Manager includes an assessment of their
ESG approach and its application in making investment
decisions. The Board reviews Governance Engagement
reports, which document the Investment Manager’s
interactions with investee companies on ESG matters
(see pages 15 to 17). The portfolio managers regularly
report to the Board on discussions with portfolio
companies on operational and strategic matters.
33
Stakeholder
Why we engage
How we engage and what we do
Registrar
The Company’s registrars provide an
interface with those shareholders who
hold
the Company’s shares directly.
The Company Secretary liaises 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 registrar is acceptable. The Investment
Manager’s risk function reviews the registrar’s internal
controls report and reports on the outcome of this
review
to the Board.
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 pages 63 to 70.
The Company’s Auditor meets with the Audit
Commitee, 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 all
respects.
Brokers
The Company’s brokers provide an
interface between the Company’s
Board and its institutional
shareholders.
The Company’s brokers regularly attend Board
meetings, and provide reports to those meetings, in
order to keep the Board apprised of shareholder and
wider market sentiment regarding the Company. They
also arrange opportunities for shareholders to meet the
Chairman outside the normal general meeting cycle.
Depositary
and Custodian
The depositary is responsible for the
safekeeping of the Company’s
financial instruments, as set out in
more detail on page 52.
The Depositary provides the Audit Committee with a
report on its monitoring activities. The Investment
Manager’s Business Risk team reviews the relevant
Bank of New York Mellon internal controls report and
reports any relevant matters to the Audit Committee.
The Board exercises robust oversight of the Depositary
and Custodian. This approach aims to enhance service
levels and strengthen relationships, 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.
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,
as adverse 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 Investment Manager 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 Company indirectly.
The Investment Manager liaises with the various
investment platforms on strategies for improving
communications with the Company’s shareholders who
hold their shares via these platforms. An annual
timetable of key dates is published on the Company’s
website, for the ease of reference of such shareholders.
Further details on how to vote via an investment
platform can be found on pages 95 and 96.
Lenders
Lenders such as holders of debt
instruments (debentures and private
placement loan notes) and banks
providing fixed or revolving credit
facilities provide the Company’s
gearing and have an interest in the
Company’s ongoing financial health
and viability.
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.
34
Stakeholder
Why we engage
How we engage and what we do
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 Investment Manager’s 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 keeping the interests of the Company’s shareholders, and of
acting fairly between them, firmly front of mind in its key decision making and 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:
• In July 2024, the Company replaced its one year £30 million revolving credit facility with
The Royal Bank of Scotland International Limited with another £30 million revolving one year
credit facility with The Royal Bank of Scotland International Limited which provides the
Company a borrowing capacity in order to generate improved returns to shareholders through
the deployment of gearing;
• In June 2024, the Board announced the introduction of a one-off 100% performance conditional
tender offer, triggered if the Company’s net asset value total return over the 5-year period from
30 April 2024 to 30 April 2029 does not equal or exceed the total return on the FTSE All Share
Index. An additional continuation vote, to be held at the Company’s Annual General Meeting in
2027, was also announced.
• As part of the Board’s succession planning, the Board completed its recruitment process
and appointed Seema Paterson on 2 January 2025. This appointment is consistent with the AIC
Corporate Governance Code principle that a ‘successful company is led by an effective board,
whose role is to promote the long-term sustainable success of the company, generating value for
shareholders and contributing to wider society’; and
• In January 2025, the Board determined to use buybacks to endeavour to maintain a single digit
share price discount to the Company’s net asset value per share, in normal market conditions. To
ensure sufficient buyback authority to maintain a single digit discount, the Board, as a
precautionary measure, determined that a Circular be made ready to convene a standalone ad-
hoc General Meeting requesting shareholder approval to renew the buyback authority should the
existing authority be fully utilised prior to the next Annual General Meeting. During the year to
30 April 2025, £31.9 million of the Company’s own shares were bought back for treasury, for
subsequent reissue at a later date at or above net asset value.
Employees, human rights and community issues
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. Further information on the Company’s approach to environmental, social and
governance (‘ESG’) matters is provided on page 53.
Gender representation
The Board comprises five Directors, two female and three male. The Company has no employees. The
Board’s policy on diversity is set out on page 50.
35
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 53.
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.
A statement by the Managers under the Act has been published on the Managers’ website at
bailliegifford.com.
Future developments of the company
The outlook for the Company for the next 12 months is set out in the Chairman’s Statement on
pages 05 to 07 and the Managers’ Report on pages 08 to 10.
The Strategic Report, which includes pages 04 to 38 was approved by the Board of Directors and
signed on its behalf on 12 June 2025.
Neil Rogan
Chairman
36
Governance report
This Governance report, which includes pages 40 to 61 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.
Directors and management
Neil Rogan
Director
Appointed 2024
Neil Rogan was appointed a Director in 2024. He is chairman of Invesco Asia Trust plc and a director
of JPMorgan Global Growth & Income Trust plc. Prior to this, he was an investment manager with
Touche Remnant, Flemings and most recently Gartmore/Henderson where he was Head of Global
Equities. He was also previously the chairman of Murray Income Trust PLC and a director of The
Scottish Investment Trust PLC.
Andrew Westenberger
Director
Appointed 2017
Andrew Westenberger was appointed a Director in 2017 and became Chairman of the Audit
Committee in 2017. He is the chief financial officer of Hurst Point Group. Previously, he was chief
executive officer of Tysers Insurance Brokers, a leading independent specialist broker and risk
management firm. He was also group finance director of Brewin Dolphin Holdings PLC and Evolution
Group Plc, a non-executive director and trustee of the Chartered Institute of Securities and Investments
and held senior finance roles at Barclays Capital and Deutsche Bank. He is a Chartered Accountant.
Ruary Neill
Director
Appointed 2018
Ruary Neill was appointed a Director in 2018 and became Senior Independent Director in July 2021.
He is currently a director of JP Morgan Emerging Markets Investment Trust plc. Previously, he worked
in investment banking at UBS Investment Bank prior to which he spent several years in the financial
sector working in Asian Equity Markets for UBS Investment Bank and Schroder Securities.
Cathy Pitt
Director
Appointed 2021
Cathy Pitt was appointed a Director in 2021. She is a former Consultant Partner at international law
firm CMS and has over 20 years’ experience advising boards and asset managers on a broad range of
corporate matters. She is a non-executive director of Gresham House Energy Storage Fund plc and the
Association of Investment Companies.
Seema Paterson
Director
Appointed 2025
Seema Paterson was appointed a Director in 2025. She is currently chief financial officer and board
director of This Works Products Limited. She sits as Chair of the Audit Committee of CQS Natural
Resources Growth and Income plc and also serves on the board of Resurgo Trust, a youth employment
charity based in London. She previously worked in mergers and acquisitions at Société Générale and in
corporate finance at Collins Stewart. She is a Chartered Accountant.
37
Managers and secretaries
The Company has appointed Baillie Gifford & Co Limited, a wholly owned subsidiary of Baillie
Gifford & Co, as its Alternative Investment Fund Manager (‘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 has been involved in investment management since 1908.
Baillie Gifford is one of the largest investment trust managers in the UK and currently manages eleven
investment trusts. Baillie Gifford also manage a listed investment company 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 total around £209 billion. Based in Edinburgh, it is one of the leading privately owned
investment management firms in the UK, with 58 partners and a staff of around 1,700.
The Managers of Baillie Gifford UK Growth plc’s portfolio are Iain McCombie and Milena Mileva.
Iain and Milena are both partners at Baillie Gifford.
Baillie Gifford & Co and Baillie Gifford & Co Limited are both authorised and regulated by the
Financial Conduct Authority.
All of the Directors are members of the following Committees: Nomination, Remuneration and
Management Engagement. All Directors are members of the Audit Committee with the exception of
Neil Rogan, who stepped down from the Committee in June 2024.
38
Directors’ Report
The Directors present their Report together with the audited Financial Statements of the Company for
the year to 30 April 2025.
Corporate governance
The Corporate Governance Report is set out on pages 47 to 54 and forms part of this Report.
Managers and company secretaries
Baillie Gifford & Co Limited, a wholly owned subsidiary of Baillie Gifford & Co, has been appointed
as the Company’s Alternative Investment Fund Manager (‘AIFM’) and Company Secretary. Baillie
Gifford & Co Limited has delegated portfolio management services to Baillie Gifford & Co. Dealing
activity and transaction reporting has been further sub-delegated to Baillie Gifford 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 by the
Managers on not less than six months’ notice or on shorter notice in certain circumstances. With effect
from 6 June 2024, the Investment Management Agreement is terminable by the Company on not less
than three months’ notice or on shorter notice in certain circumstances. Prior to this, the Investment
Management Agreement was terminable by the Company on not less than six 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 0.5% of net assets, calculated
and payable quarterly.
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 shareholders.
Investment management
The Board considers the Company’s investment management arrangements on an ongoing basis and a
formal review is conducted annually by the Management Engagement Committee, most recently in
February 2025. The Management Engagement Committee considered, amongst others, the following
topics in its review:
• The quality of personnel assigned to handle the Company’s affairs
• The investment process and the results achieved to date
• Investment performance
• The marketing efforts undertaken by the Managers
• The relationship with the Managers
• Comparative peer group charges and fees
The Management Engagement Committee scored and assessed that the quality of personnel assigned to
the Company’s affairs is exceptionally strong, as is the commitment of Baillie Gifford to this Company
and its other investment trust clients. The relationship is strong for both sides and the management fee
is very competitive for a UK active equity vehicle. Performance over five years remains well behind
benchmark but has improved significantly since the Board undertook a “deep-dive” review a year ago
and we believe it has the potential to improve further. The one area in which the Board is looking for
an improvement over the next year is that we aim to see increased marketing, making the case for
BGUK specifically.
At this review the Management Engagement Committee concluded that the continuing appointment of
Baillie Gifford & Co Limited as AIFM, and the delegation of investment management services to
39
Baillie Gifford & Co and the further sub-delegation of dealing activity and transaction reporting to
Baillie Gifford Overseas Limited, on the terms agreed, is in the interests of the Company and
shareholders as a whole. This was subsequently approved by the Board.
Secretarial and administrative
The Board considers its company secretarial and administrative needs separately from its investment
management arrangements and considers, amongst others, the following:
• Timeliness and accuracy of information provided
• A sense of working for the Company rather than the Manager
• Ability to manage issues between meetings
• Direct and opportunity costs of an alternative
As some directors have had a poor experience of third party company secretaries separate from the
Investment Managers, as it would impose additional costs on the Company and as the existing
arrangements are working well, the Board considers employing Baillie Gifford & Co Limited as
company secretary is clearly in the interests of the Company and shareholders as a whole. This was
subsequently approved by the Board.
Depositary
In accordance with the Alternative Investment Fund Managers Regulations, The Bank of New York
Mellon (International) Limited has been appointed as Depositary to the Company. 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 custody function is also undertaken
by The Bank of New York Mellon (International) Limited (‘the Custodian’).
Directors
Information about the Directors, including their relevant experience, can be found on pages 40 and 41.
All the Directors, with the exception of Seema Paterson, will retire at the Annual General Meeting and
offer themselves for re-election. Seema Paterson will stand for election at the 2025 AGM. 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 April 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.
40
Dividend
The Board recommends a final dividend of 5.70p per ordinary share. No interim dividend was
declared. Dividends are paid by way of a single final payment.
If approved by shareholders at the Annual General Meeting, the recommended final dividend per
ordinary share will be paid on 12 September 2025 to shareholders on the register at the close of
business on 15 August 2025. The ex-dividend date is 14 August 2025.
Share capital
Capital structure
The Company’s capital structure at 30 April 2025 consists of 160,917,184 ordinary shares of 25p each
(2024 – 160,917,184) of which 129,274,810 (2024 – 146,678,507) were allotted and fully paid and
31,642,374 (2024 – 14,238,677) are held in treasury. 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.
Dividend
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 92 to 94.
Major interests in the company’s shares
The Company has received notifications in accordance with the Financial Conduct Authority’s
Disclosure and Transparency Rules of the following interests in the voting rights attached to the
Company’s issued share capital.
Name
No of ordinary
25p shares
held at
30 April 2025
% of
issue *
Hargreaves Lansdown (Nominees) Limited (direct)
18,591,683
14.4
City of London Investment Management Company Limited (indirect)
18,175,119
14.1
1607 Capital Partners, LLC (indirect)
13,019,690
10.1
Rathbone Investment Management Ltd and Rathbone Investment
Management International Ltd (combined, indirect)
11,140,955
8.6
Interactive Investor Services Nominees Limited (direct)
8,000,998
6.2
No changes to the major interests in the Company’s shares have been intimated between 1 May and 10 June 2025.
* Ordinary shares in issue excluding treasury shares.
Annual general meeting
Share issuance authority
At the last Annual General Meeting, the Directors were granted shareholders’ approval for a general
authority to allot shares and also an authority to issue shares or sell shares held in treasury on a non
pre-emptive basis (without first offering such shares to existing shareholders pro-rata to their existing
holdings). No shares were issued during the year (2024 – no shares were issued).
41
Both authorities expire at the forthcoming Annual General Meeting and the Directors are seeking
shareholders’ approval to renew them for a further year, as detailed below.
Resolution 11 in the Notice of Annual General Meeting seeks a general authority for the Directors to
allot shares up to an aggregate nominal amount of £3,191,294.25. This amount represents 10% of the
Company’s total ordinary share capital in issue at 10 June 2025 and meets institutional guidelines. This
authority will continue until the conclusion of the Annual General Meeting to be held in 2026 or on the
expiry of 15 months from the passing of the resolutions, if earlier.
Resolution 12, which is proposed as a special resolution, seeks authority for the Directors to
issue shares or sell shares held in treasury on a non pre-emptive basis for cash up to an aggregate
nominal amount of £3,191,294.25 (representing 10% of the issued ordinary share capital of the
Company as at 10 June 2025). This authority will only be used to issue shares or sell shares from
treasury at a premium to net asset value on the basis of debt valued at par value and only when the
Directors believe that it would be in the best interests of the Company to do so. This authority will
continue until the conclusion of the Annual General Meeting to be held in 2026 or on the expiry of 15
months from the passing of the resolutions, if earlier.
Market purchases of own shares
At the last Annual General Meeting the Company was granted authority to purchase up to 21,590,578
ordinary shares (equivalent to 14.99% of its issued share capital), such authority to expire at the 2025
Annual General Meeting. However, due to the level of buybacks in the period since the last Annual
General Meeting, see below for details, the Directors do not consider the existing authority sufficient
and have called a General Meeting for 3 July 2025 seeking shareholder approval to renew the buyback
authority earlier than would normally have been the case. Notwithstanding this, the Directors are
seeking shareholders’ approval at the Annual General Meeting to renew the authority to make market
purchases up to 19,135,001 ordinary shares representing approximately 14.99% of the Company’s
ordinary shares in issue at the date of passing of the resolution, such authority to replace the authority
granted at the General Meeting on 3 July 2025, subject to shareholder approval, and to expire at the
Annual General Meeting of the Company to be held in 2026.
17,403,697 shares (2024 – 3,841,977 shares) were bought back during the year under review and as at
30 April 2025 31,642,374 shares were held in treasury (2024 – 14,238,677). Between 1 May and 10
June 2025, the Company bought back 1,623,033 shares into treasury at a cost of £3,150,742.
33,265,407 shares were held in treasury as at 10 June 2025.
The share buy-back policy seeks to operate in the best interests of shareholders by taking into account
the relative level of the Company’s share price discount when compared with peer group trusts, the
absolute level of discount and the impact from share buy-back activity on the long-term liquidity of the
Company’s issued shares.
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).
All buy-backs will initially be held in treasury. Shares will only be resold from treasury at a premium
to net asset value per ordinary share.
The Company shall not be entitled to exercise the voting rights attaching to treasury shares.
In accordance with the Listing Rules of the Financial Conduct Authority, the maximum price
(excluding expenses) that may be paid on the exercise of the authority must not exceed 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. an amount equal to the higher of the price of the last independent trade of an Ordinary Share and
the highest current independent bid for an Ordinary Share on the trading venue where the
purchase is carried out.
42
The minimum price (exclusive of expenses) that may be paid will be 25p per share. Purchases of shares
will be made within guidelines established, from time to time, by the Board. Your attention is drawn to
Resolution 13 in the Notice of Annual General Meeting. This authority, if conferred, will only be
exercised if to do so would result in an increase in net asset value per ordinary share for the remaining
shareholders and if it is considered in the best interests of shareholders generally.
The Board continues to monitor the available buyback authority.
Financial instruments
The Company’s financial instruments comprise its investment portfolio, cash balances 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 18 to the Financial
Statements.
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 auditors
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 that information.
Independent auditor
The Auditor, Ernst & Young LLP, is willing to continue in office and in accordance with section 489
and section 491(1) of the Companies Act 2006, resolutions concerning their re-appointment and
remuneration will be submitted to the Annual General Meeting.
Post balance sheet events
At the last Annual General Meeting the Company was granted authority to purchase up to 21,590,578
ordinary shares (equivalent to 14.99% of its issued share capital), such authority to expire at the 2025
Annual General Meeting. However, due to the level of buybacks in the period since the last Annual
General Meeting the Directors do not consider the existing authority sufficient and have called a
General Meeting for 3 July 2025 seeking shareholder approval to renew the buyback authority earlier
than would normally have been the case.
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 04 to 38.
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’ Report)
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 therefore is not required to disclose energy and carbon
information.
43
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.
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.
On behalf of the Board
Neil Rogan
Chairman
12 June 2025
44
Corporate governance report
The Board is committed to achieving and demonstrating high standards of corporate governance. The
Association of Investment Companies (‘AIC’) Code of Corporate Governance (‘AIC Code’) provides a
framework of best practice for investment companies and can be found at theaic.co.uk. The Financial
Reporting Council (‘FRC’) has confirmed that AIC members who report in relation to the AIC Code,
as is the case with the Company, will be meeting their obligations in relation to the 2018 UK Corporate
Governance Code (‘UK Code’) which can be found at frc.org.uk.
Compliance
The Board confirms that the Company has complied throughout the year under review with the
relevant provisions of the Code and the recommendation of the AIC Code. The Code includes
provisions relating to the role of the chief executive, executive directors’ remuneration and the need for
an internal audit function. Given that the Company is an externally managed investment trust, the
Board considers these provisions are not relevant to the Company. The need for an internal audit
function specific to the Company has been addressed on page 55.
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. A separate session devoted to
strategy is held each year. 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.
The Board comprises five 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 Ruary
Neill.
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 on pages 40 and 41.
There is an agreed procedure for Directors to seek independent professional advice, if necessary, at the
Company’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, a Director appointed during the year is
required to retire and seek election by shareholders at the next Annual General Meeting. The Board has
agreed that all Directors will retire at each Annual General Meeting and, if appropriate, offer
themselves for re-election.
45
Board of Directors
Comprises independent
non-executive directors*
Chairman: Neil Rogan
Senior Independent
Director: Ruary Neill
Audit
Committee
Management
Engagement
Committee
Remuneration
Committee
Nomination
Committee
Chairman:
Andrew Westenberger
Purpose: The primary purpose
of the Company’s Audit
Committee is to provide
oversight of the financial
reporting process, the audit
process, the Company’s system
of internal controls and
compliance with laws and
regulations.
Chairman:
Neil Rogan
Purpose: The primary purpose
of the Management Engagement
Committee is to ensure that the
investment management,
administrative and company
secretarial services provided to
the Company remain appropriate
and competitive.
Chairman:
Ruary Neill
Purpose: The primary purpose
of the Remuneration Committee
is to review and make
recommendations to the Board
in respect of the level of
remuneration paid to Directors
within the limits approved by
shareholders.
Chairman:
Neil Rogan
Purpose: The main purpose of
the Nomination Committee is to
oversee Board recruitment and
succession planning as well as
Board appraisals including
identifying training needs.
Third-party service providers
appointed by the Board
Alternative Investment Fund Managers 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
Ernst & Young
LLP
Auditor
The Bank of
New York Mellon
(International) Limited
Depositary
Computershare
Investor Services
PLC
Registrar
Winterflood
Securities Ltd
Company broker
* The independent non-executive directors are made up of Neil Rogan, Ruary Neill, Andrew Westenberger, Cathy Pitt and Seema Paterson.
All Directors are members of the Management Engagement Committee, Remuneration Committee and Nomination Committee. All
Directors, with the exception of the Chairman of the Company, are members of the Audit Committee. Further details on their experience
can be found on pages 40 and 41.
46
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 composition annually. The Board is of the view 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.
Meetings
There is an annual cycle of Board meetings which is designed 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 core Board and
Committee meetings held during the year, excluding ancillary and sub-committee meetings. The
Annual General Meeting was attended by all the Directors.
Board
Audit
Committee
Nomination
Committee
Remuneration
Comittee
Management
Engagement
Committee
Number of meetings
4
2
1
1
1
Ruary Neill
4
2
1
1
1
Seema Paterson
†
1
–
1
1
1
Cathy Pitt
4
2
1
1
1
Neil Rogan*
4
1
1
1
1
Andrew Westenberger
4
2
1
1
1
* Neil Rogan stepped down as a member of the Audit Committee in June 2024 but attends by invitation.
† Seema Paterson did not attend all of the meetings during the year because she was appointed on 2 January 2025. She attended all of the
meetings held following her appointment and therefore attended all applicable meetings.
Nomination Committee
The Nomination Committee consists of all the Directors and Neil Rogan is the Chairman of the
Committee. The Committee meets on an annual basis and at such other times as may be required. The
Committee has written terms of reference which include reviewing the composition of the Board,
identifying and nominating new candidates for appointment to the Board, Board appraisal, succession
planning and training. The Committee also considers whether Directors should be recommended for re-
election by shareholders.
The Committee’s Terms of Reference are available on request from the Company and on the
Company’s page of the Managers’ website: bgukgrowthtrust.com.
During the year, the Committee engaged an external search consultancy, Trust Associates, to recruit a
new Director to join the Board. Seema Paterson was identified as the preferred candidate and was
appointed with effect from 2 January 2025. Trust Associates has no other connection with the
Company.
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
During the year, the Board appointed Cyclico, a firm which assists companies with the design and
execution of board evaluations, to facilitate an appraisal of the Chairman, each Director and a
47
performance evaluation and review of the Board as a whole and its Committees. Cyclico is an
independent company with no relationships with the Company or its Directors. Cyclico provided
questionnaires which were tailored to the specific needs of the Company. The questionnaires
addressed, amongst other issues:
• Investment strategy and performance and engagement with the Managers;
• Shareholder value, stakeholder engagement and interests, marketing and promotion;
• Board and Committee composition, dynamics and expertise; and
• Quality of Board documentation, administration and third party relationships.
Each Director and the Chairman completed the questionnaire, with Cyclico reviewing and reporting on
the results which were discussed at a meeting of the Nomination Committee. The Chairman’s appraisal
was led by Ruary Neill, the Senior Independent Director. The results indicated that the Board as a
whole was performing effectively. Areas of particular scrutiny and deliberation by the Board that were
assessed, included: the review of investment performance and the subsequent constructive engagement
with the Managers; the proposals for a performance-related tender offer in five years and an interim
continuation vote in three years; the effort to reduce the discount through more active use of share
buybacks; and the ongoing focus on the marketing efforts required to raise the Company’s profile and
stimulate demand.
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 its Committees 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 Nomination
Committee is satisfied that they are capable of devoting sufficient time to the Company.
There were no significant changes to the Chairman’s nor each Director’s other commitments during the
year.
Diversity policy
Appointments to the Board are made on merit with due regard for the benefits of diversity including
the requirements of the Listing Rules. The priority in appointing new Directors is to identify the
candidate with the best range of skills and experience to complement existing Directors.
The Board believes that maintaining a diversity of thought and experience on the Board and at an
operational level within Baillie Gifford represents the best way of discharging its responsibilities to
shareholders.
Board composition as at 30 April 2025
Sex
Number of
Board
Members
Percentage of
the Board
Number of
Senior
Positions
on the Board
Men
3
60
2
Women
2
40
–
Not specified/prefer not to say
–
–
–
* The Company only has two of the senior roles specified by the Listing Rules, that is the position of Chairman and SID. While the
Company considers the role of Audit Chairman to be a senior role, this is not reflected as a senior role in this table. The role of Audit
Committee Chairman is currently held
by a man.
48
Ethnicity
Number of
Board
Members
Percentage of
the Board
Number of
Senior
Positions
on the Board
White British or other White (including minority white
groups)
4
80
2
Asian/Asian British
1
20
–
Not specified/prefer not to say
–
–
–
* The Company only has two of the senior roles specified by the Listing Rules, that is the position of Chairman and SID. While the
Company considers the role of Audit Chairman to be a senior role, this is not reflected as a senior role in this table. The current Audit
Committee Chairman’s ethnic background
is White British.
Diversity of the board
The Directors consider Board composition in terms of the overall value the Board offers to
shareholders; this means that it seeks to ensure that (i) the Directors, between them, have diverse
expertise allowing them to bring an appropriate range of skills to the performance of their duties; and
(ii) the Directors represent a diverse range of backgrounds and characteristics, which enables a range of
perspectives to contribute to governance and decision-making.
The FCA Listing Rules on diversity and inclusion set out the targets which should be met as follows:
(i) at least 40% of individuals on a board should be women; (ii) at least one senior board position
should be held by a woman; and (iii) at least one individual on its board should be from a minority
ethnic background (as defined by the Office of National Statistics (ONS) criteria). As an externally
managed investment company with no chief executive officer (CEO) or chief financial officer (CFO),
the roles which qualify as senior under FCA guidance are the Chairman and Senior Independent
Director (SID). The Board considers the Audit Committee Chairman to be a senior role.
As shown in the Board composition tables, the Company met the targets on percentage of women and
ethnic diversity but did not meet the target in relation to women in senior roles.
The Board considers that its small size is the principal reason why the other 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.
All recruitment for new board members will be external, through the use of search agencies or
platforms. Recruitment consultants will be asked to put forward candidates with the desired skillset but
also with a diverse range of characteristics.
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.
Remuneration Committee
The Remuneration Committee consists of all Directors and Ruary Neill is the Chairman of the
Committee. The Remuneration Committee reviews and makes recommendations to the Board in
respect of the level of remuneration paid to Directors within the limits approved by shareholders. The
Company’s policy on remuneration is set out in the Directors’ Remuneration Report on pages 57 to 60.
The Committee’s Terms of Reference are available on request from the Company and on the
Company’s page of the Managers’ website: bgukgrowthtrust.com.
Management Engagement Committee
The role of the Management Engagement Committee is to ensure that the Manager remains suitable to
manage the portfolio, that the management contract is competitive and reasonable for shareholders, and
that the Company maintains appropriate administrative and company secretarial support. All Directors
49
are members of the Management Engagement Committee which is chaired by the Chairman of the
Board. The Board considers each member of the Committee to be independent.
To discharge its duties, the Committee met on one occasion during the year to consider: the
performance and suitability of the Manager; the terms and conditions of the AIFM Agreement,
including fees; and, the Committee’s Terms of Reference.
The Committee’s Terms of Reference are available on request from the Company and on the
Company’s page of the Managers’ website: bgukgrowthtrust.com.
Audit Committee
The report of the Audit Committee is set out on pages 55 to 56.
Internal controls and risk management
The Directors acknowledge their responsibility for the Company’s risk management and internal
control systems and for reviewing their effectiveness. 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 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 these risks.
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 to review
their effectiveness on a regular basis. No significant weaknesses were identified in the year under
review and up to the date of this 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 Report.
To comply with the Alternative Investment Fund Managers Regulations, The Bank of New York
Mellon (International) Limited 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
50
the loss of financial instruments held in custody. The Depositary will ensure that any delegate
segregates the assets of the Company. The Company’s Depositary also acts as the Company’s
Custodian. 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 99), 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 and include market risk, liquidity risk
and credit risk. An explanation of these risks and how they are managed is contained in note 18 to the
Financial Statements. The Board has, in particular, considered recent heightened geopolitical tensions
and conflicts and macroeconomic concerns, including increased inflation and interest rates. It has
reviewed specific leverage and liquidity stress testing but does not believe the Company’s going
concern status is affected. The Company’s assets, the vast majority of which are 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. Details of the Company’s one year loan facility with The Royal Bank of
Scotland International Limited which is due to be repaid in July 2025 are shown in note 11 on page 81.
Negotiations are underway to replace this facility. 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) Regulations 2011.
In accordance with the Company’s Articles of Association, shareholders have the right to vote on the
continuation of the Company every five years, the next regular vote being at the Annual General
Meeting to be held in 2029. In addition, the Board have implemented an additional, ad-hoc
continuation vote to be taken at the Annual General Meeting in 2027.
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 34 and revenue estimates prepared to 30 June 2026, that the Company will
continue in operational existence for a period of at least twelve months from the date of approval of
these Financial Statements.
Relations with shareholders
The Board places great importance on communication with shareholders. The Chairman meets
shareholders independently of the Managers and reports 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, Winterflood Investment Trusts (see
contact details on page 104). All correspondence addressed to the Chairman is dealt with directly by
the Chairman. The Company’s Managers also meet regularly with shareholders and their
representatives.
51
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 bgukgrowthtrust.com subsequent to the meeting. The notice period for the Annual
General Meeting is at least twenty working days. Shareholders and potential investors may obtain up-
to-date information on the Company from the Managers’ website at bgukgrowthtrust.com.
Corporate governance and stewardship
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. 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’ Stewardship Principles and examples of portfolio company engagement are set out on
pages 11 to 17 and the Statement of Compliance with the UK Stewardship Code can be found on the
Managers’ website: bailliegifford.com. The Managers’ approach has been reviewed and endorsed by
the Board.
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. The Board
reviews regular reports on voting and engages with the Managers on these matters.
Baillie Gifford & Co, the Company’s Managers, has considered the Sustainable Finance Disclosures
Regulation (‘SFDR’) and further details can be found on page 103.
The Managers, Baillie Gifford & Co, are signatories to the United Nations Principles for Responsible
Investment and are also members of the International Corporate Governance Network.
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 utilise data sourced
from a third-party provider to map the carbon footprint of the equity portfolio using the information to
prioritise engagement and understand what higher emitting companies are doing to manage climate risk
better. The carbon intensity of the Company’s portfolio is 84% lower than the Company’s benchmark
(FTSE All-Share). This analysis is based on 98% of the value of the Company’s equity portfolio which
reports on carbon emissions and other carbon related characteristics and is measured using data from
MSCI via the Factset platform.
Carbon intensity measures the carbon efficiency of the portfolio per unit of output and assesses the
portfolio’s exposure to carbon-intensive companies.
Baillie Gifford’s Task Force on Climate-Related Financial Disclosures (‘TCFD’) Climate Report
is available 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 bgukgrowthtrust.com.
The Managers, Baillie Gifford & Co, are signatories to the Carbon Disclosure Project.
On behalf of the Board
Neil Rogan
Chairman
12 June 2025
52
Audit Committee report
The Audit Committee consists of all independent Directors except for the Chairman of the Board, Neil
Rogan. The members of the Committee consider that they have the requisite financial skills and
experience to fulfil the responsibilities of the Committee. Andrew Westenberger, Chairman of the
Committee, is a Chartered Accountant. 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: bgukgrowthtrust.com. The Terms of Reference are
reviewed annually.
The Committee’s effectiveness is reviewed on an annual basis as part of the Board’s performance
evaluation process (see page 49).
At least once a year the Committee meets with the external Auditor without any representative of the
Manager being present.
Main activities of the committee
The Committee met twice during the year to 30 April 2025 and the external Auditor attended both
meetings. Baillie Gifford & Co’s Internal Audit and Compliance Departments and the AIFM’s
permanent risk function provided reports on their monitoring programmes for these meetings. The
external auditor also met with the Chairman of the Audit Committee separately twice during the year.
The matters considered, monitored and reviewed by the Committee during the course of the year
included the following:
• the results announcements and the Annual and Interim reports;
• the Company’s accounting policies and practices and the implementation of the Managers’
valuation policy for investments in unlisted (private) companies;
• 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/re-appointment, 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;
• internal controls reports received from the Managers and other service providers; 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 Investment 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.
53
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 99.5% 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 Baillie Gifford’s Report on Internal
Controls which details the controls in place regarding the recording and pricing of investments. The
Managers agreed the prices of all the listed investments at 30 April 2025 to external price sources and
the holdings were agreed to confirmations from the Company’s Custodian.
The Committee reviewed the Managers’ valuation approach for investments in unlisted companies
(as described on pages 75 and 76) and approved the valuation of the unlisted investment following
a detailed review of the valuation of the investment and relevant challenge where appropriate. The
Managers agreed the holding in certificated form to confirmations from the Company’s Custodian.
The Committee reviewed the Managers’ report on Internal Controls which details the controls in place
regarding completeness and accurate recording of investment income. The accounting treatment of
each special dividend received or receivable during the year was reviewed by the Managers.
The Managers 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.
Internal controls and risk management
The Committee reviewed the effectiveness of the Company’s risk management and internal controls
systems as described on pages 51 and 52. No significant 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 current year;
• a report from the Auditor describing their arrangements to manage auditor independence and
received confirmation of its independence; and
• the extent of non-audit services provided by the external Auditor. There were no non-audit fees
for the year to 30 April 2025.
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 on Ernst & Young LLP issued by the FRC’s Audit Quality
Review team; 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 the audit.
54
The audit partner responsible for the audit will be 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. Ms Mercer, the current partner, will continue as audit partner until the
conclusion of the 2025 audit. The year under audit represents Ms Mercer’s fifth year as audit partner.
Ernst & Young 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 for the purposes of this year’s audit.
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 61 to 70.
On behalf of the Board
Andrew Westenberger
Audit Committee Chairman
12 June 2025
55
Directors’ remuneration report
This report has been prepared in accordance with the requirements of the Companies Act 2006.
Statement by the Chairman
The Remuneration Committee reviewed the level of fees during the year and the Board agreed the
Committee’s recommendation that, with effect from 1 May 2025 the Directors’ fees should be
increased from £30,000 to £31,000, the fee for the Chairman of the Board should be increased from
£42,500 to £46,500, the additional fee for the Chairman of the Audit Committee should be increased
from £5,000 to £6,000 and the additional fee for the Senior Independent Director should remain
unchanged at £1,500. The increases in Directors’ fees reflect the Board’s policy to determine the level
of Director’s remuneration having regards to the time commitments, increased risks and
responsibilities of the role and the amounts payable to non-executive Directors in the industry
generally in order to ensure that remuneration levels do not deter candidates from applying for
potential positions on the Board. To that end independent research on the fee levels of Directors of peer
group companies, as well as industry norms, has been considered. The fees were last increased on
1 May 2023.
The Directors’ Remuneration Policy is subject to shareholder approval every three years or sooner if an
alteration to the policy is proposed. The Remuneration Policy was last approved at the Annual General
Meeting in September 2023 and no changes are proposed to the policy for the Annual General Meeting
to be held in 2025. Although there are no proposed changes to the Remuneration Policy, shareholders
should note that a resolution is being put before shareholders at the Company’s upcoming Annual
General Meeting seeking a change in the Company’s Articles of Association that would increase the
aggregate limit of Directors’ fees from £200,000 per annum to £250,000 per annum.
The £200,000 aggregate limit has been in place since the Company’s incorporation in January 1994.
During the past financial year, the Board has taken the decision to expand the number of Directors
sitting on the Board from four to five. Whilst noting that the proposed fee increases in Directors’ fees
from 1 May 2025 leaves the aggregated level of Directors’ fees within the £200,000 per annum limit,
the Board believes it prudent to bring forward a Resolution at the next Annual General Meeting to
amend the limit in the Company’s Articles of Association in order to have greater headroom and also
flexibility should there be further appointments to the Board that results in an increase in the number of
Directors, even if only for a temporary period.
Directors’ remuneration policy
The determination of the Directors’ fees is a matter considered by the Remuneration Committee and
recommended to the Board for adoption.
It is the Board’s policy to determine the level of Directors’ remuneration having regard to amounts
payable to non-executive Directors in the industry generally, the role that individual Directors fulfil in
respect of Board and Committee responsibilities, and time committed to the Company’s affairs, taking
into account the aggregate limit of fees set out in the Company’s Articles of Association.
This aggregate limit of Directors’ fees is currently set at £200,000 per annum and any increase in this
level requires approval by the Board and the Company’s shareholders. Shareholder approval is being
sought for an increase to £250,000 per annum at the 2025 Annual General Meeting, see resolution 14.
The Chairman of the Board, the Chairman of the Audit Committee and the Senior Independent
Director each receive fees at a higher rate than the other Directors to reflect their additional
responsibilities. Directors’ fees are set at a level to recruit and retain individuals of sufficient calibre,
with the level of knowledge, experience and expertise necessary to promote the success of the
Company in reaching its short and long-term strategic objectives.
The Board and its Committees exclusively comprise non-executive Directors. No Director past or
present has an entitlement to a Company pension, and the Company has not, and does not intend to
operate a share scheme for Directors or to award any share options or long-term performance
incentives to any Director. No Director has a service contract with the Company. However, Directors
56
have a letter of appointment. Directors do not receive exit payments and are not provided with any
compensation for loss of office. No other payments are made to Directors other than the reimbursement
of reasonable out-of-pocket expenses incurred in attending to the Company’s business.
The terms of Directors’ letters of appointment are available for inspection at the Company’s registered
office address during normal business hours and during the Annual General Meeting at the location of
such meeting.
The Board did not seek the views of shareholders in setting this Remuneration Policy. Any comments
on the Policy received from shareholders would be considered on a case-by-case basis. As the
Company does not have any employees, no employee pay and employment conditions were taken into
account when setting this Remuneration Policy and no employees were consulted in its construction.
Directors’ fees are reviewed annually and take into account research from third parties on the fee levels
of directors of peer group companies, as well as industry norms and factors affecting the time
commitment expected of the Directors. New Directors are subject to the provisions set out in this
Remuneration Policy.
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 by way of ordinary resolution.
Your attention is drawn to Resolution 14 in the Notice of Annual General Meeting on page 91, where
the Board seeks shareholder approval to increase the aggregate annual limit to £250,000, to enable the
Board to continue to attract candidates of suitable calibre and allow for overlap of tenure, improving its
capacity for succession planning.
The fees paid in respect of the year ended 30 April 2025 together with the expected fees payable in
respect of the year ending 30 April 2026 are set out in the following table. The fees payable to the
Directors in the subsequent financial years will be determined following an annual review of the
Directors’ fees.
Name
Expected
fees for year
ending
30 April 2026
£
Fees
as at
30 April 2025
£
Chairman's fee
46,500
42,500
Non-executive Director fee
31,000
30,000
Additional fee for Chair of the Audit Committee
6,000
5,000
Additional fee for Senior Independent Director
1,500
1,500
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
250,000
200,000
Annual report on remuneration
An ordinary resolution for the approval of this report will be put to the members at the forthcoming
Annual General Meeting.
The law requires the Company’s Auditor to audit certain disclosures provided in this report. Where
disclosures have been audited, they are indicated as such. The Auditor’s opinion is included in the
Independent Auditor’s Report on pages 63 to 70.
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, 98.2% were in favour, 0.3% were against and votes withheld were 1.5%. At the
last Annual General Meeting at which the Directors’ Remuneration Policy was considered (September
57
2023), 99.7% of the proxy votes received were in favour, 0.2% were against and 0.1% votes were
withheld.
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
£
Carolan Dobson
(retired 4 September 2024)
5,312
1,010
6,322
42,500
5,261
47,761
Ruary Neill
31,500
2,710
34,210
31,500
2,818
34,318
Seema Paterson
(appointed 2 January 2025)
9,891
382
10,273
n/a
n/a
n/a
Cathy Pitt
30,000
2,468
32,468
30,000
4,000
34,000
Neil Rogan
40,990
2,732
43,722
10,000
1,998
11,998
Andrew Westenberger
35,000
1,559
36,559
35,000
4,192
39,192
152,693
10,861
163,554
149,000
18,269
167,269
* Comprises expenses incurred by Directors in the course of travel to attend Board and Committee meetings held at the normal place of
business.
These amounts have been grossed up for applicable income tax and national insurance.
Annual Percentage Change in Remuneration
This represents the annual percentage change in the remuneration paid to the Directors.
Name
2025
fees
%
2025
taxable
benefits
%
2024
fees
%
2024
taxable
benefits
%
2023
fees
%
2023
taxable
benefits
%
2022
fees
%
2022
taxable
benefits
%
2021
fees
%
2021
taxable
benefits
%
Carolan Dobson
(retired 4 September
2024)
(87.5)
(80.8)
4.7
102.0
5.7
294.7
1.6
n/a
0.8
(100.0)
Ruary Neill
–
(3.8)
2.9
2.6
6.4
2,115.3
6.5
n/a
0.7
(100.0)
Seema Paterson
(appointed 2 January
2025)
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Cathy Pitt
(appointed 5 August
2021)
–
(38.3)
3.1
103.6
43.0
46.6
n/a
n/a
n/a
n/a
Neil Rogan
309.9
36.8
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Andrew
Westenberger
–
(62.8)
5.7
27.4
7.8
659.8
1.7
n/a
0.7
(100.0)
Where fees or taxable benefits for a Director were nil in the prior year, the year on year movement has
been noted as ‘n/a’. Due to Covid-19 restrictions, there was no travel for the financial year to 30 April
2021. In person Board and committee meetings resumed partway through the financial year to
30 April 2022.
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 have been no changes intimated in the Directors’ interests up to 12 June 2025.
58
Name
Nature of
interest
Ordinary 25p
shares held
at 30 April
2025
Ordinary 25p
shares held
at 30 April
2024
Ruary Neill
Beneficial
36,707
20,000
Seema Paterson (appointed 2 January 2025)
Beneficial
10,000
n/a
Cathy Pitt
Beneficial
16,487
5,362
Neil Rogan
Beneficial
84,861
15,328
Andrew Westenberger
Beneficial
20,000
20,000
Relative importance of spend on Pay
The table below shows the actual expenditure during the year in relation to Directors’ remuneration
and distributions to shareholders.
2025
£’000
2024
£’000
Change
%
Directors’ remuneration
164
167
(1.8%)
Dividends
8,111
5,410
49.9%
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 All-Share Index. This index was chosen for comparison
purposes as it is a widely used measure of performance for UK listed companies and also the index
against which the Company measures its performance.
Performance graph
(figures rebased to 100 at 30 April 2015)
GRAPH
Source: LSEG and relevant underlying index providers. See disclaimer on page 99.
All figures are total returns (assuming net dividends are reinvested). See Glossary of Terms and Alternative Performance Measures on
pages 100 to 102.
Past performance is not a guide to future performance.
Approval
The Directors’ remuneration report on pages 57 to 60 was approved by the Board of Directors
and signed on its behalf on 12 June 2025.
Ruary Neill
Remuneration Committee Chairman
59
Statement of Directors’ responsibilities
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. Under that
law they have elected to prepare the Financial Statements in accordance with applicable law and
United Kingdom Accounting Standards, comprising Financial Reporting Standard 102 the Financial
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.
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 have general authority for taking such
steps as are reasonably open to them to safeguard 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 that law and those regulations.
The Directors have delegated responsibility to the Managers for the maintenance and integrity of the
Company’s page of the Managers’ website. Legislation in the United Kingdom governing the
preparation and dissemination of Financial Statements may differ from legislation in other
jurisdictions.
Responsibility statement of the Directors in respect 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 issuer, together with a description of the principal risks and uncertainties
they face; 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
Neil Rogan
12 June 2025
60
Financial
Report
The Financial Statements for the year to 30 April 2025 are set out on pages 62 to 87 have been
prepared in accordance with FRS 102 ‘The Financial Reporting Standard applicable in the UK
and Republic of Ireland’.
Independent
auditor’s report
to the members of Baillie Gifford UK Growth Trust plc
Opinion
We have audited the financial statements of Baillie Gifford UK Growth Trust plc (‘the Company’) for
the year ended 30 April 2025 which comprise the Income Statement, the Balance Sheet, the Statement
of Changes in Equity, the Cash Flow Statement, and the related notes 1 to 20, 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 FRS 102 “The
Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom
Generally Accepted Accounting Practice).
In our opinion, the financial statements:
• give a true and fair view of the Company’s affairs as at 30 April 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.
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.
Independence
We are 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
public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Company
and we remain independent of the Company in conducting the audit.
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:
• Confirmation of our understanding of the Company’s going concern assessment process and
engaged with the Directors and the Company Secretary to determine if all key factors that we
have become aware of during our audit were considered in their assessment.
61
• Inspection of the Directors’ assessment of going concern, including the revenue forecast, for the
period to 30 June 2026 which is at least twelve months from the date these financial statements
were authorised for issue. In preparing the revenue forecast, the Company has concluded that it
is able to continue to meet its ongoing costs as they fall due.
• Review of the factors and assumptions, including the impact of the current economic
environment, as applied to the revenue forecast and the liquidity assessment of the investments.
We considered the appropriateness of the methods used to calculate the revenue forecast and the
liquidity assessment and determined, through testing of the methodology and calculations, that
the methods, inputs and assumptions utilised were appropriate to be able to make an assessment
for the Company.
• Assessment of the risk of breaching the debt covenants as a result of a reduction in the value of
the Company’s portfolio. We calculated the Company’s compliance with debt covenants and we
performed reverse stress testing in order to identify what factors would lead to the Company
breaching the financial covenants.
• Consideration of the mitigating factors included in the revenue forecasts that are within the
control of the Company. We reviewed the Company’s assessment of the liquidity of investments
held and evaluated the Company’s ability to sell those investments in order to cover working
capital requirements should revenue decline significantly.
• Review of the Company’s going concern disclosures included in the annual report in order to
assess that the disclosures were appropriate and in conformity with the reporting standards.
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 to 30 June 2026 which is at least twelve months
from when the financial statements are authorised for issue.
In relation to the Company’s ‘s reporting on how they have 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 of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are
described in the relevant sections of this report. However, because not all future events or conditions
can be predicted, this statement is not a guarantee as to the Company’s ability to continue as a going
concern.
Overview of our audit approach
Key audit matters
• Risk of incomplete or inaccurate revenue recognition,
including the classification of special dividends as
revenue or capital items in the Income Statement
•
Risk of incorrect valuation or ownership of the
investment portfolio
Materiality
• Overall materiality of £2.60m which represents 1% of
shareholders’ funds.
An overview of the scope of our audit
Tailoring the scope
Our assessment of audit risk, our evaluation of materiality and our allocation of performance
materiality determine our audit scope for the Company. This enables us to form an opinion on the
financial statements. We take into account size, risk profile, the organisation of the Company and
effectiveness of controls, the potential impact of climate change and changes in the business
environment when assessing the level of work to be performed. All audit work was performed directly
by the audit engagement team and our valuation specialists.
62
Climate change
Stakeholders are increasingly interested in how climate change will impact companies. The Company
has determined that the most significant future impacts from climate change on its operations will be
from how climate change could affect the Company’s investments and overall investment process.
These are explained on page 31 in the principal and emerging risk section. This disclosure forms part
of the “Other information,” rather than the audited financial statements. Our procedures on these
unaudited disclosures therefore consisted solely of considering whether they are materially inconsistent
with the financial statements or our knowledge obtained in the course of the audit or otherwise appear
to be materially misstated, in line with our responsibilities on “Other information”.
Our audit effort in considering climate change was focused on the adequacy of the Company’s
disclosures in the financial statements as set out in note 1(a) and conclusion there was no further
impact of climate change to be taken into account as in line with FRS 102 listed investments are valued
at fair value, which for the Company are quoted bid prices for investments in active markets at the
balance sheet date and therefore reflect market participants view of climate change risk. The unlisted
investment has been valued with reference to a recent purchase price adjusted for benchmark
performance (comparable companies) which reflect market participants view of climate change risk.
We also challenged the Directors’ considerations of climate change in their assessment of viability and
associated disclosures.
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. These matters included
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 our opinion thereon, and we do not provide a
separate opinion on these matters.
63
Risk
Our response to the risk
Key observations communicated to the
Audit Committee
Incomplete or inaccurate revenue
recognition, including the
classification of special dividends as
revenue or capital items in the
Income Statement
Refer to the Audit Committee Report
(pages
55 and 56); Accounting policies
(pages
75 to 77); and Note 2 of the
Financial Statements (page
77)
The total revenue for the year ended
30
April 2025 was £8.89m (2024:
£9.79m), consisting of dividend income
from listed equity investments.
The investment income receivable by
the Company during the year directly
affects the Company’s revenue return.
There is a risk of incomplete or
inaccurate recognition of revenue
through the failure to recognise proper
income entitlements or to apply an
appropriate accounting treatment.
In addition, the Directors may be
required to exercise judgment in
determining whether income receivable
in the form of special dividends should
be classified as ‘revenue’ or ‘capital’ in
the Income Statement.
We obtained an understanding of
Baillie Gifford’s processes and controls
surrounding revenue recognition by
performing walkthrough procedures.
For all dividends received and accrued,
we recalculated the dividend income by
multiplying the investment holdings at
the ex-dividend date, traced from the
accounting records, by the dividend per
share, which was agreed to an
independent data vendor. We also
agreed, for a sample of dividends
received and dividends accrued,
amounts to bank statements.
To test completeness of recorded
income, we tested that expected
dividends for each investee company
held during the year had been recorded
as income with reference to an external
source.
For all dividends accrued at the year
end, we reviewed the investee company
announcements to assess whether the
entitlement arose prior to 30 April
2025.
For all investments held during the
year, we inspected the type of
dividends paid with reference to an
external data source to identify those
which were special dividends. We
confirmed four special dividends,
amounting to £1.3m, were received
during the year. We tested all four
special dividends by recalculating the
amount received and assessing the
appropriateness of classification as
revenue by reviewing the underlying
circumstances of the special dividends
received.
The results of our procedures identified
no material misstatement in relation to
the risk of incomplete or inaccurate
revenue recognition, including the
classification of special dividends as
revenue or capital items in the Income
Statement.
64
Risk
Our response to the risk
Key observations communicated to the
Audit Committee
Incorrect valuation or ownership of
the investment portfolio
Refer to the Audit Committee Report
(pages
55 and 56); Accounting policies
(pages
75 to 77); and Note 9 of the
Financial Statements (pages
79 and 80)
The valuation of the investment
portfolio at 30 April 2025 was
£282.96m (2024:
£296.59m) consisting
of listed equities with an aggregate
value of £279.20m (2024: £293.25m)
and an unlisted equity investment
amounting to £3.76m (2024:
£3.34m).
The valuation of the assets held in the
investment portfolio is the key driver of
the Company’s net asset value and total
return. Incorrect investment pricing, or
failure to maintain proper legal title of
the investments held by the Company
could have a significant impact on the
portfolio valuation and the return
generated for shareholders.
The fair value of listed investments is
determined using quoted market bid
prices at close of business on the
reporting date.
The unlisted investment is valued at
fair value by the Directors following a
detailed review and appropriate
challenge of the valuations proposed by
the Investment Manager. The unlisted
investment policy applies
methodologies consistent with the
International Private Equity and
Venture Capital Valuation guidelines
(“IPEV”).
The valuation of the unlisted
investment, and the resultant impact on
the unrealised gains/(losses), is the area
requiring the most significant
judgement and estimation in the
preparation of the financial statements.
We obtained an understanding of the
Investment Manager’s processes and
controls surrounding investment
valuation and legal title, including an
understanding of the operation of the
Investment Manager’s Unlisted
Valuation Securities Group and the
Directors’ process for review of the
unlisted investment valuations, by
performing walkthrough procedures.
For all listed investments in the
portfolio, we compared the market
prices to an independent pricing vendor
and recalculated the investment
valuations as at the year end.
We inspected the stale price reports
produced by Baillie Gifford to identify
prices that have not changed and
verified whether the listed price is a
valid fair value. We did not identify
any listed investments with stale prices.
For the unlisted investment held as at
the year-end we utilised our specialist
valuations team to review and
challenge the valuation. This included:
• Reviewing the valuation papers
prepared by the Investment
Manager as at the year end;
• Assessing whether the valuation
has been performed in line with the
IPEV guidelines;
• Assessing whether the valuation
has been performed in accordance
with the accounting policy;
• Assessing the appropriateness of
the data inputs and challenging the
assumptions used to support the
valuations; and
• Assessing other facts and
circumstances, such as market
movement and comparative
company information, that have an
impact on the fair market value of
the unlisted investment.
• Determining an independent fair
value range for the valuation and
assessing whether Management’s
valuation is within this range.
We recalculated the unrealised
gains/losses on investments as at the
year-end using the book-cost
reconciliation.
We compared the Company’s
investment holdings as at 30 April 2025
to an independent confirmation
received directly from the Company’s
Custodian.
The results of our procedures identified
no material misstatement in relation to
the risk of incorrect valuation or
ownership of the investment portfolio.
65
Our application of materiality
We apply the concept of materiality in planning and performing the audit, in evaluating the effect of
identified misstatements on the audit and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably
be expected to influence the economic decisions of the users of the financial statements. Materiality
provides a basis for determining the nature and extent of our audit procedures.
We determined materiality for the Company to be £2.60 million (2024: £2.83 million), which is 1%
(2024: 1%) of shareholders’ funds. We believe that shareholders’ funds provides us with a materiality
aligned to the key measure of the Company’s performance.
Performance materiality
The application of materiality at the individual account or balance level. It is set at an amount to reduce
to an appropriately low level the probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality.
On the basis of our risk assessments, together with our assessment of the Company’s overall control
environment, our judgement was that performance materiality was 75% (2024: 75%) of our planning
materiality, namely £1.95m (2024: £2.12m). We have set performance materiality at this percentage
due to our experience of working with the Company that indicates a lower risk of material
misstatements, both corrected and uncorrected.
Given the importance of the distinction between revenue and capital for investment trusts, we have also
applied a separate testing threshold for the revenue column of the Income Statement of £0.37m (2024:
£0.42m), being 5% of the net revenue return on ordinary activities before taxation.
Reporting threshold
An amount below which identified misstatements are considered as being clearly trivial.
We agreed with the Audit Committee that we would report to them all uncorrected audit differences in
excess of £0.13m (2024: £0.14m), which is set at 5% of planning materiality, as well as differences
below that threshold that, in our view, warranted reporting on qualitative grounds.
We evaluate any uncorrected misstatements against both the quantitative measures of materiality
discussed above and in light of other relevant qualitative considerations in forming our opinion.
Other information
The other information comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. The Directors are responsible for the other information
contained within the annual report.
Our opinion on the financial statements does not cover the other information and, except to the extent
otherwise explicitly stated in this 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 the other information, we are required
to report that fact.
We have nothing to report in this regard.
66
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the Directors’ remuneration report to be audited has been properly prepared
in accordance with the Companies Act 2006.
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 Directors’ reports have been prepared in accordance with applicable
legal requirements;
Matters on which we are required to report by exception
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 Directors’
report.
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
Corporate Governance Statement
We have reviewed 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 by the UK Listing Rules.
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:
• Directors’ statement with regards to the appropriateness of adopting the going concern basis of
accounting and any material uncertainties identified set out on page 53;
• Directors’ explanation as to its assessment of the Company’s prospects, the period this
assessment covers and why the period is appropriate set out on page 34;
• Director’s statement on whether it has a reasonable expectation that the group will be able to
continue in operation and meets its liabilities set out on page 53;
• Directors’ statement on fair, balanced and understandable set out on page 61;
• Board’s confirmation that it has carried out a robust assessment of the emerging and principal
risks set out on pages 30 to 33;
• The section of the annual report that describes the review of effectiveness of risk management
and internal control systems set out on pages 51 and 52; and;
• The section describing the work of the audit committee set out on pages 55 and 56.
Responsibilities of directors
As explained more fully in the Directors’ responsibilities statement set out on page 61, 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
67
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.
Explanation as to what extent the audit was considered 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 irregularities, including fraud. 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 or
intentional misrepresentations, or through collusion. The extent to which our procedures are capable of
detecting irregularities, including fraud is detailed below.
However, the primary responsibility for the prevention and detection of fraud rests with both those
charged with governance of the Company and management.
• We obtained an understanding of the legal and regulatory frameworks that are applicable to the
Company and determined that the most significant are United Kingdom Generally Accepted
Accounting Practice, the Companies Act 2006, the Listing Rules, UK Corporate Governance
Code, the Association of Investment Companies’ Code and Statement of Recommended
Practice, Section 1158 of the Corporation Tax Act 2010 and The Companies (Miscellaneous
Reporting) Regulations 2018.
• We understood how the Company is complying with those frameworks through discussions with
the Audit Committee and Company Secretary and review of Board minutes and the Company’s
documented policies and procedures.
• We assessed the susceptibility of the Company’s financial statements to material misstatement,
including how fraud might occur by considering the key risks impacting the financial
statements. We identified a fraud risk with respect to the incomplete or inaccurate revenue
recognition through incorrect classification of special dividends as revenue or capital items in
the Income Statement and incorrect valuation of the unquoted investment and the resultant
impact on unrealised gains/(losses). Further discussion of our approach is set out in the section
on key audit matters above.
• Based on this understanding we designed our audit procedures to identify non-compliance with
such laws and regulations. Our procedures involved review of the reporting to the Directors with
respect to the application of the documented policies and procedures and review of the financial
statements to ensure compliance with the reporting requirements of the Company.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at https://www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor’s report.
68
Other matters we are required to address
Following the recommendation from the audit committee, we were appointed by the Company on 5
August 2020 to audit the financial statements for the year ending 30 April 2021 and subsequent
financial periods.
• The period of total uninterrupted engagement including previous renewals and reappointments is
five years, covering the years ending 30 April 2021 to 30 April 2025.
• The audit opinion is consistent with the additional report to the audit committee.
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.
Caroline Mercer (Senior statutory auditor)
for and on behalf of Ernst & Young LLP,
Statutory Auditor
Edinburgh
12 June 2025
69
Income statement
for the year ended 30 April 2025 (with comparatives for the year ended 30 April 2024)
For the year ended 30 April
Notes
2025
Revenue
£’000
2025
Capital
£’000
2025
Total
£’000
2024
Revenue
£’000
2024
Capital
£’000
2024
Total
£’000
Gains/(losses) on
investments
9
–
11,412
11,412
–
(6,288)
(6,288)
Currency losses
–
(48)
(48)
–
(93)
(93)
Income
2
8,893
–
8,893
9,787
–
9,787
Investment management
fee
3
(433)
(1,010)
(1,443)
(421)
(982)
(1,403)
Other administrative
expenses
4
(598)
–
(598)
(568)
–
(568)
Net return before finance
costs and taxation
7,862
10,354
18,216
8,798
(7,363)
1,435
Finance costs of
borrowings
5
(394)
(919)
(1,313)
(314)
(732)
(1,046)
Net return on ordinary
activities before taxation
7,468
9,435
16,903
8,484
(8,095)
389
Tax on ordinary activities
6
–
–
–
–
–
–
Net return of ordinary
activities after taxation
7,468
9,435
16,903
8,484
(8,095)
389
Net return per ordinary
share
7
5.32p
6.72p
12.04p
5.68p
(5.42p)
0.26p
Dividends declared in respect of the financial year ended 30 April 2025 amount to 5.70p (2024 –
5.60p). Further information on dividend distributions can be found in note 8 on page 79.
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 75 to 87 are an integral part of the Financial Statements.
70
Balance sheet
as at 30 April 2025 (with comparatives as at 30 April 2024)
As at 30 April
Notes
2025
£’000
2025
£’000
2024
£’000
2024
£’000
Fixed assets
Investments held at fair value through profit or
loss
9
282,957
296,590
Current assets
Debtors
10
1,776
2,242
Cash and cash equivalents
18
823
1,917
2,599
4,159
Creditors
Amounts falling due within one year
11
(25,469)
(17,596)
Net current liabilities
(22,870)
(13,437)
Net assets
260,087
283,153
Capital and reserves
Share capital
12
40,229
40,229
Share premium account
13
11,664
11,664
Capital redemption reserve
13
19,759
19,759
Warrant exercise reserve
13
417
417
Share purchase reserve
13
17,522
49,380
Capital reserve
13
152,943
143,508
Revenue reserve
13
17,553
18,196
Shareholders’ funds
260,087
283,153
Net asset value per ordinary share*
14
201.2p
193.0p
The Financial Statements of Baillie Gifford UK Growth Trust plc (Company registration number
2894077) were approved and authorised for issue by the Board and were signed on 12 June 2025.
Neil Rogan
Chairman
* See Glossary of Terms and Alternative Performance Measures on pages 100 to 102.
The accompanying notes on pages 75 to 87 are an integral part of the Financial Statements.
71
Statement of changes in equity
For the year ended 30 April 2025
Notes
Share
capital
£’000
Share
premium
account
£’000
Capital
redemption
reserve
£’000
Warrant
exercise
reserve
£’000
Share
purchase
reserve
£’000
Capital
reserve
£’000
Revenue
reserve
£’000
Shareholders’
funds
£’000
Shareholders’ funds at
1 May 2024
40,229
11,664
19,759
417
49,380
143,508
18,196
283,153
Ordinary shares bought
back into treasury
12
–
–
–
–
(31,858)
–
–
(31,858)
Dividends paid during the
year
8
–
–
–
–
–
–
(8,111)
(8,111)
Net return on ordinary
activities after taxation
7
–
–
–
–
–
9,435
7,468
16,903
Shareholders’ funds at
30 April 2025
40,229
11,664
19,759
417
17,522
152,943
17,553
260,087
For the year ended 30 April 2024
Notes
Share
capital
£’000
Share
premium
account
£’000
Capital
redemption
reserve
£’000
Warrant
exercise
reserve
£’000
Share
purchase
reserve
£’000
Capital
reserve
£’000
Revenue
reserve
£’000
Shareholders’
funds
£’000
Shareholders’ funds at
1 May 2023
40,229
11,664
19,759
417
55,628
151,603
15,122
294,422
Ordinary shares bought
back into treasury
12
–
–
–
–
(6,248)
–
–
(6,248)
Dividends paid during the
year
8
–
–
–
–
–
–
(5,410)
(5,410)
Net return on ordinary
activities after taxation
7
–
–
–
–
–
(8,095)
8,484
389
Shareholders’ funds at
30 April 2024
40,229
11,664
19,759
417
49,380
143,508
18,196
283,153
The accompanying notes on pages 75 to 87 are an integral part of the Financial Statements.
72
Cash flow statement
For the year ended 30 April 2025 (with comparatives for the year ended 30 April 2024)
Notes
2025
£’000
2025
£’000
2024
£’000
2024
£’000
Cash flows from operating activities
Net return on ordinary activities before taxation
16,903
389
Adjustments to reconcile company profit before tax to net cash flow from operating activities
Net (gains)/losses on investments
9
(11,412)
6,288
Currency losses
48
93
Finance costs of borrowings
1,313
1,046
Other capital movements
Changes in debtors
(126)
(171)
Changes in creditors
(96)
31
Cash from operations*
6,630
7,676
Interest paid
(1,284)
(897)
Net cash inflow from operating activities
5,346
6,779
Cash flows from investing activities
Acquisitions of investments
(7,944)
(24,185)
Disposals of investments
33,581
23,251
Net cash inflow/(outflow) from investing
activities
25,637
(934)
Cash flows from financing activities
Bank loan drawn down
8,000
1,900
Equity dividends paid
5
(8,111)
(5,410)
Ordinary shares bought back into treasury and
stamp duty thereon
12
(31,918)
(5,837)
Net cash outflow from financing activities
(32,029)
(9,347)
(Decrease) in cash and cash equivalents
(1,046)
(3,502)
Exchange movements
(48)
(93)
Cash and cash equivalents at start of year
15
1,917
5,512
Cash and cash equivalents at end of year
†
15
823
1,917
* Cash from operations includes dividends received of £8,693,000 (2024 – £9,539,000) and £82,000 deposit interest (2024 – £82,000).
† Cash and cash equivalents represents cash at bank and short-term deposits repayable on demand.
The accompanying notes on pages 75 to 87 are an integral part of the Financial Statements.
73
Notes to the Financial Statements
01 Significant accounting policies
The Financial Statements for the year to 30 April 2025 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 set out below which are consistent with those applied for the
year ended 30 April 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 at fair value through profit or loss 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 recent
heightened geopolitical tensions and conflicts and macroeconomic concerns, including
increased inflation and interest rates. It has reviewed the results of specific leverage and
liquidity stress testing, but does not believe the Company’s going concern status is
affected. The Company’s assets, which are primarily investments in quoted securities and
are readily realisable (Level 1) exceed its liabilities significantly and could be sold to
repay borrowings if required.
All borrowings require the prior approval of the Board. Gearing levels and compliance
with loan covenants are reviewed by the Board on a regular basis. The Royal Bank of
Scotland International Limited one year revolving credit facility which was due for
repayment in July 2024 was replaced with another The Royal Bank of Scotland
International Limited one year revolving credit facility as shown in note 11 on page 81.
Negotiations are underway to replace this facility.
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) Regulations 2011.
In accordance with the Company’s Articles of Association, shareholders have the right to
vote on the continuation of the Company every five years, the next regular vote being at
the Annual General Meeting to be held in 2029. In addition, the Board have implemented
an additional, ad-hoc continuation vote to be taken at the Annual General Meeting in
2027.
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 34, that the Company will continue
in operational existence until 30 June 2025, which is for a period of at least twelve
months from the date of approval of these Financial Statements.
The Financial Statements have been prepared in accordance with the Companies Act
2006, applicable United Kingdom 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 with
consequential amendments. In order to better reflect the activities of the Company and in
accordance with guidance issued by the AIC, supplementary information which analyses
the profit and loss account between items of a revenue and capital nature has been
presented in the Income statement.
Financial assets and financial liabilities are recognised in the Company’s Balance sheet
when it becomes a party to the contractual provisions of the instrument.
74
In preparing these Financial Statements the Directors have considered the impact of
climate change risk as a principal risk as set out on page 31. In line with FRS 102
investments are valued at fair value, which for the Company are quoted bid prices for
investments in active markets at the balance sheet date and therefore reflect market
participants view of climate change risk. The unlisted investment has been valued in
reference to a recent purchase price (see 1(b) below) which similarly reflects market
participants view of climate change risk.
The Directors consider the Company’s functional currency to be sterling as the
Company’s shareholders are predominantly based in the UK and the Company and its
investment manager, who are subject to the UK’s regulatory environment, are also UK
based.
The Company has only one material segment being that of an investment trust company
investing in a portfolio of long term investments.
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 the reported
amounts 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 investment.
Judgements
The Directors consider that the preparation of the Financial Statements involves the key
judgements in relation to the fair valuation of the unlisted investment.
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’) to each
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.
Estimates
The key estimate in the Financial Statements is the determination of the fair value of the
unlisted investment by the Managers for consideration by the Directors. This estimate is
key as it significantly impacts the valuation of the unlisted investment 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 to assist with the valuation
validation or the application of valuation adjustments. Comparable companies are
chosen on the basis of their business characteristics and growth patterns; and
ii. the estimation of the probability assigned to an exit being through an initial public
offering (‘IPO’) or a company sale.
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.
75
Purchases and sales of investments are recognised on a trade date basis.
Upon initial recognition investments in securities are recognised at fair value, which is
transaction value. Subsequently, investments are included at fair value which are quoted
bid prices for investments traded in active markets. Changes in the fair value of
investments and gains and losses on disposal are recognised as capital items in the
Income statement.
Unlisted investments are valued at fair value following a detailed review and appropriate
challenge of the valuations. The Managers’ unlisted investment policy applies
methodologies consistent with the International Private Equity and Venture Capital
Valuation guidelines (‘IPEV’). 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 using the techniques described above.
d. Cash and cash equivalents
Cash and cash equivalents 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 or period 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 is recognised on an accruals basis.
iv. 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.
f. Expenses
All expenses are accounted for on an accruals basis. Expenses are charged through the
revenue account except as follows:
i. Where they relate directly to the acquisition or disposal of an investment, in which
case they are charged to capital. These expenses are commonly referred to as
transaction costs and comprise brokerage commission and stamp duty.
ii. The management fee is allocated 30% to revenue and 70% to capital in line with
the Board’s expected long-term split of revenue and capital return from the
Company’s investment portfolio.
g. Borrowings and finance costs
Finance costs are accounted for on an accruals basis. Finance costs are allocated 30% to
revenue and 70% to capital in line with the Board’s expected long-term split of revenue
and capital return from the Company’s investment portfolio.
h. Deferred taxation
In accordance with FRS 102, deferred taxation is provided on all timing differences
which have originated but not reversed by the Balance sheet date, calculated on a non-
76
discounted basis at the tax rates expected to apply when the timing differences reverse,
based on what has been enacted or substantially 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. Value Added Tax (VAT)
Expenses are disclosed inclusive of the related irrecoverable VAT.
j. Dividend Distributions
Final dividends are recognised in the year in which the dividends are approved by the
Company’s shareholders.
k. Share premium account
The balance classified as share premium represents:
• the proceeds of sales of shares held in treasury in excess of the weighted average
purchase price paid by the Company to repurchase the shares; and
• the excess of the proceeds of issuance of new shares over the nominal value.
l. Capital redemption reserve
The nominal value of ordinary share capital repurchased and cancelled is transferred out
of the called-up share capital and into the capital redemption reserve.
m. Warrant exercise reserve
The premium arising on issue of shares where there were warrants attached was
apportioned between shares and warrants as part of shareholders’ funds on the basis of
the market values of the shares and warrants on the first day of dealing. The warrant
element was referred to as the warrant reserve. On exercise of these warrants, the
premium relating to the warrants exercised is transferred from the warrant reserve to a
warrant exercise reserve.
n. Share purchase reserve
The costs of repurchasing ordinary shares, including related stamp duty and transaction
costs, are taken directly to share purchase reserve. Share purchase transactions are
accounted for on a trade date basis.
o. 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. The sales proceeds of treasury shares reissued are treated as a realised profit up
to the amount of the weighted average purchase price of those shares and is transferred to
capital reserves.
p. 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.
77
02 Income
2025
£’000
2024
£’000
Income from investments
UK dividends
8,811
9,705
Other income
Deposit interest
82
82
Total income
8,893
9,787
Special dividends received in the year amounted to £1,303,000 (2024 – £1,491,000) with
£1,303,000 (2024 – £1,491,000) classified to revenue and nil (2024 – nil) classified to capital.
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
433
1,010
1,443
421
982
1,403
Details of the Investment Management Agreement are disclosed on page 42. Baillie Gifford &
Co Limited’s annual management fee is 0.5% of net asset value, calculated on a quarterly basis.
04 Other administrative expenses
2025
£’000
2024
£’000
General administrative expenses
201
187
Custody charges
21
22
Directors’ fees (see Directors’ remuneration report page 59)
153
149
Auditor’s remuneration for audit services*
64
62
Marketing
†
89
81
Depositary fees
33
33
Registrar fees
37
34
598
568
* Includes irrecoverable VAT of £11,000 (2024 – £10,000).
† 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 of borrowings
2025
Revenue
£’000
2025
Capital
£’000
2025
Total
£’000
2024
Revenue
£’000
2024
Capital
£’000
2024
Total
£’000
Interest on bank loan
394
919
1,313
314
732
1,046
78
06 Tax
2025
£’000
2024
£’000
Analysis of charge in year
Tax charge for the year
–
–
–
–
Factors affecting tax charge for year
The tax assessed for the year is lower than the standard rate of
corporation tax in the UK of 25% (2024
– 25%). The differences are
explained below:
Net return on ordinary activities before taxation
16,903
389
Net return on ordinary activities multiplied by the standard rate of
corporation tax in the UK of 25% (2024 – 25%)
4,226
97
Effects of:
Capital returns not taxable/allowable
(2,841)
1,595
Income not taxable
(2,188)
(2,403)
Taxable losses in year not utilised
803
711
Tax charge for the year
–
–
As an investment trust, the Company’s capital gains are not taxable.
Factors that may affect future tax charges
At 30 April 2025 the Company had surplus management expenses and losses on non-trading
loan relationships of £60,128,000 (2024 – £56,916,000) which have not been recognised as a
deferred tax asset. This is because the Company is not expected to generate taxable income in a
future period in excess of the deductible expenses of that future period and, accordingly, it is
unlikely that the Company will be able to reduce future tax liabilities through the use of existing
surplus expenses.
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 on the revaluation 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
5.32p
6.72p
12.04p
5.68p
(5.42p)
0.26p
Revenue return per ordinary share is based on the net revenue return on ordinary activities after
taxation of £7,468,000 (2024 – £8,484,000), and on 140,340,918 (2024 – 149,401,543) 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
£9,435,000 (2024 – net capital loss of £8,095,000), and on 140,340,918 (2024 – 149,401,543)
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.
79
08 Ordinary dividends
2025
2024
2025
£’000
2024
£’000
Amounts recognised as distributions in
the year:
Previous year’s final dividend
(paid 13 September 2024)
5.60p
3.60p
8,111
5,410
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
£7,468,000 (2024 – £8,484,000).
2025
2024
2025
£’000
2024
£’000
Dividends paid and payable in respect
of the year:
Proposed final dividend
(payable 12 September 2025)
5.70p
5.60p
7,369
8,214
09 Fixed assets – investments
Investments in securities are financial assets classified as held at fair value through profit or
loss. In accordance with Financial Reporting Standard 102, the following tables 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.
As at 30 April 2025
Level 1
£’000
Level2
£’000
Level 3
£’000
Total
£’000
Listed equities
279,200
–
–
279,200
Unlisted preference shares*
–
–
3,757
3,757
Total financial asset investments
279,200
–
3,757
282,957
As at 30 April 2024
Level 1
£’000
Level2
£’000
Level 3
£’000
Total
£’000
Listed equities
293,252
–
–
293,252
Unlisted preference shares*
–
–
3,338
3,338
Total financial asset investments
293,252
–
3,338
296,590
* The unlisted preference shares investment represents a holding in Wayve Technologies Ltd.
Fair value hierarchy
The fair value hierarchy used to analyse the basis on which the fair values of financial
instruments held at fair value through the profit and loss account are measured is described
below. Fair value measurements are categorised on the basis of the lowest level input that is
significant to the fair value measurement.
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 Company’s unlisted investment at 30 April 2025 was valued using the price of a recent
transaction adjusted for benchmark performance. A sensitivity analysis of the unlisted security’s
valuation, where applicable, is on pages 84 and 85.
80
Listed
securities
£’000
Unlisted
securities *
£’000
2025
total
£’000
2024
total
£’000
Cost of investments held at start of year
299,106
1,516
300,622
309,050
Investment holding losses at start of year
(5,854)
1,822
(4,032)
(6,514)
Value of investments held at start of
year
293,252
3,338
296,590
302,536
Analysis of transactions during the
year:
Purchases at cost
7,944
–
7,944
24,185
Sales – proceeds received
(32,989)
–
(32,989)
(23,843)
Gains/(losses) on investments
10,993
419
11,412
(6,288)
Value of investments held at end of
year
279,200
3,757
282,957
296,590
Cost of investments held at end of year
268,951
1,516
270,467
300,622
Investment holding gains/(losses) at end
of year
10,249
2,241
12,490
(4,032)
Fair value of investments held at end of
year
279,200
3,757
282,957
296,590
* The unlisted securities investment represents a holding in Wayve Technologies Ltd.
The Company received proceeds of £32,989,000 (2024 – £23,843,000) from investments sold in
the year. The book cost of these investments when they were purchased was £38,099,000 (2024
– £32,613,000). These investments have been revalued over time and until they were sold any
unrealised gains/losses were included in the fair value of the investments.
Transaction costs of £32,000 (2024 – £118,000) and £11,000 (2024 – £9,000) were suffered on
purchases and sales respectively.
2025
£’000
2024
£’000
Net (losses)/gains on investments classified as held at fair value
through profit or loss
Losses on sale
(5,110)
(8,770)
Changes in investment holding gains
16,522
2,482
11,412
(6,288)
10 Debtors
2025
£’000
2024
£’000
Amounts falling due within one year:
Accrued income and prepaid expenses
1,737
1,622
Investment sales awaiting settlement
–
592
Other debtors and prepayments
39
28
1,776
2,242
None of the above debtors are financial assets designated at fair value through profit or loss. The
carrying amount of debtors is a reasonable approximation of fair value.
11 Creditors – amounts falling due within one year
2025
£’000
2024
£’000
Bank loans
24,350
16,350
Share buybacks awaiting settlement
351
411
Other creditors and accruals
768
835
25,469
17,596
81
None of the above creditors are financial liabilities held at fair value through profit or loss.
Included in other creditors is £325,000 (2024 – £354,000) in respect of the investment
management fee.
At 30 April 2025, the Company had a one year £30 million unsecured revolving credit loan
facility with The Royal Bank of Scotland International Limited which expires in July 2025. At
30 April 2025, £24,350,000 was drawn down under this facility. At 30 April 2024, £16,350,000
was drawn down under a one year £30 million unsecured revolving credit loan facility with The
Royal Bank of Scotland International Limited which expired in July 2024.
The main covenant relating to the above loan is that total borrowings shall not exceed 30% of
adjusted portfolio value. There were no breaches of loan covenants during the year.
12 Share capital
2025
Number
2025
£’000
2024
Number
2024
£’000
Allotted, called up and fully paid ordinary
shares of 25p each
129,274,810
32,319
146,678,507
36,669
Treasury shares of 25p each
31,642,374
7,911
14,238,677
3,560
160,917,184
40,230
160,917,184
40,229
The Company’s shareholder authority permits it to hold shares bought back ‘in treasury’. Under
such authority, treasury shares may be subsequently either sold for cash (at a premium to net
asset value per ordinary share) or cancelled. At the Company’s Annual General Meeting held on
4 September 2024 the Company was granted authority to buy back 21,590,578 ordinary shares.
During the financial year to 30 April 2025, 17,403,697 shares were bought back into treasury at
a total cost of £31,858,000 (2024 – 3,841,977 shares were bought back into treasury at a total
cost of £6,248,000).
In the year to 30 April 2025, no shares were sold from treasury (2024 – no shares were sold
from treasury). At 30 April 2025 the Company had authority to issue or sell from treasury
14,604,350 ordinary shares.
13 Capital and reserves
Share
capital
£’000
Share
premium
account
£’000
Capital
redemptio
n
reserve
£’000
Warrant
exercise
reserve
£’000
Share
purchase
reserve
£’000
Capital
reserve
£’000
Revenue
reserve
£’000
Shareholders’
funds
£’000
At 1 May 2024
40,229
11,664
19,759
417
49,380
143,508
18,196
283,153
Gains on investments
–
–
–
–
–
11,412
–
11,412
Ordinary shares
bought back into
treasury
–
–
–
–
(31,858)
–
–
(31,858)
Investment
management fee
charged to capital
–
–
–
–
–
(1,010)
–
(1,010)
Finance costs of
borrowings charged to
capital
–
–
–
–
–
(919)
–
(919)
Other exchange
differences
–
–
–
–
–
(48)
–
(48)
Dividends paid in year
–
–
–
–
–
–
(8,111)
(8,111)
Revenue return on
ordinary activities after
taxation
–
–
–
–
–
–
7,468
7,468
At 30 April 2025
40,229
11,664
19,759
417
17,522
152,943
17,553
260,087
82
Share
capital
£’000
Share
premium
account
£’000
Capital
redemptio
n
reserve
£’000
Warrant
exercise
reserve
£’000
Share
purchase
reserve
£’000
Capital
reserve
£’000
Revenue
reserve
£’000
Shareholders’
funds
£’000
At 1 May 2023
40,229
11,664
19,759
417
55,628
151,603
15,122
294,422
Losses on investments
–
–
–
–
–
(6,288)
–
(6,288)
Ordinary shares
bought back into
treasury
–
–
–
–
(6,248)
–
–
(6,248)
Investment
management fee
charged to capital
–
–
–
–
–
(982)
–
(982)
Finance costs of
borrowings charged to
capital
–
–
–
–
–
(732)
–
(732)
Other exchange
differences
–
–
–
–
–
(93)
–
(93)
Dividends paid in year
–
–
–
–
–
–
(5,410)
(5,410)
Revenue return on
ordinary activities after
taxation
–
–
–
–
–
–
8,484
8,484
At 30 April 2024
40,229
11,664
19,759
417
49,380
143,508
18,196
283,153
The capital reserve includes investment holding gains of £12,489,000 (2024 – losses of
£4,032,000) as disclosed in note 9. The revenue reserve and the capital reserve (to the extent it
constitutes realised profits) are distributable.
14 Net asset value per ordinary share
2025
2024
2025
£’000
2024
£’000
Ordinary shares of 25p
201.2p
193.0p
260,087
283,153
Net asset value per ordinary share is based on the net assets as shown above and 129,274,810
(2024 – 146,678,507) ordinary shares, being the number of ordinary shares in issue at the year
end, excluding shares held in treasury.
15 Analysis of change in net debt
At 1 May
2024
£’000
Cash flows
£’000
Exchange
movement
£’000
At 30 April
2025
£’000
Cash and cash equivalents
1,917
(1,046)
(48)
823
Loans due within one year
(16,350)
(8,000)
–
(24,350)
(14,433)
(9,046)
(48)
(23,527)
At 1 May
2023
£’000
Cash flows
£’000
Exchange
movement
£’000
At 30 April
2024
£’000
Cash and cash equivalents
5,512
(3,502)
(93)
1,917
Loans due within one year
(14,450)
(1,900)
–
(16,350)
(8,938)
(5,402)
(93)
(14,433)
16 Contingent liabilities, guarantees and financial commitments
There were no contingent liabilities, guarantees or financial commitments at either year end.
17 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 57 to 60. No Director has a contract of
service with the Company. During the years reported, no Director was interested in any contract
or other matter requiring disclosure under section 412 of the Companies Act 2006.
83
The Management fee due to Baillie Gifford & Co Limited is set out in note 3 on page 77 and the
amount accrued at 30 April 2025 is set out in note 11 on page 81. Details of the Investment
Management Agreement are set out on page 42. With effect from 6 June 2024, the Investment
Management Agreement is terminable by the Company on not less than three months’ notice or
on shorter notice in certain circumstances. Prior to this, the Investment Management Agreement
was terminable by the Company on not less than six months’ notice or on shorter notice in
certain circumstances.
18 Financial instruments
The Company invests in equities for the long term so as to achieve its investment objective of
long-term capital growth with the aim of providing a total return in excess of the FTSE All-
Share Index. The Company borrows money when the Board and 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 either a reduction in the Company’s net assets or a reduction in the profits available for
dividend.
These risks are categorised here as market risk (comprising interest rate risk, market price risk
and currency risk), liquidity risk and credit 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 the short-term volatility.
The risk management policies and procedures outlined in this note have not changed
substantially from the previous accounting year.
Market risk
The fair value or future cash flows of a financial instrument or other investment held by the
Company may fluctuate because of changes in market prices. This market risk comprises three
elements – interest rate risk, market price risk and currency risk. The Board of Directors reviews
and agrees policies for managing these risks and the Company’s Investment Manager assesses
the exposure 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 18 to 23.
i. Interest rate risk
Interest rate movements may affect the level of income receivable on cash deposits and interest
payable on variable 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.
Cash generally comprises cash at bank, which can earn interest. 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.
The interest risk profile of the Company’s financial assets and financial liabilities and the
maturity profile of the undiscounted future cash flows in respect of the Company’s contractual
financial liabilities at 30 April are shown below:
84
2025
£’000
2024
£’000
The interest rate risk profile of the Company’s financial assets at 30
April 2025 was:
Cash
823
1,917
The interest rate risk profile of the Company’s financial liabilities at
30 April 2025 was:
Floating rate borrowings
24,350
16,350
All short term floating rate borrowings are stated at book cost which is considered to be equal to
their fair value given the facilities are revolving credit facilities.
Interest rate sensitivity
An increase of 100 basis points in interest rates, with all other variables held constant, would
have decreased the Company’s total net assets and total return on ordinary activities for the year
ended 30 April 2025 by £267,000 (2024 – £198,000). A decrease of 100 basis points would
have had an equal but opposite effect.
ii. Market 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 9.
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, the investment portfolio and the
rationale for the current investment positioning to ensure consistency with the Company’s
objectives and investment policies.
Other price risk sensitivity
A full list of the Company’s investments is shown on pages 22 and 23. There is a concentration
of exposure to the UK, though it should be noted that the Company’s investment may not be
entirely exposed to economic conditions in the UK, as many UK listed companies do much of
their business overseas. 107.3% (2024 – 103.6%) of the Company’s net assets are invested in
quoted equities. A 10% increase in quoted equity valuations at 30 April 2025 would have
increased total net assets by £27,920,000 (2024 – £29,325,000). A decrease of 10% would have
had an equal but opposite effect.
1.4% (2024 – 1.2%) of the Company’s net assets are invested in unlisted (private) company
investments. The fair valuation of the private company investment is influenced by the
estimates, assumptions and judgements made in the fair valuation process (see 1(b) on page 76).
Where applicable, 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.
Significant unobservable inputs*
At 30 April 2025
Valuation technique
Fair value
of investment
£’000
Significant
unobservable
inputs
Other
unobservable
inputs †
Range
Weighted
average
range
Sensitivity
%
Sensitivity to
changes in
significant
unobservable
inputs
Benchmark
performance
3,757
Selection
of
comparable
companies
and
relevant
indices
a,b,c,d
(31%)
to 71%
13%
10%
If input
comparable
company
performance
changed by
+/- 10%, the
fair value would
change by +/-
£375,652
85
Significant unobservable inputs*
At 30 April 2024
Valuation technique
Fair value
of investment
£’000
Significant
unobservable
inputs
Other
unobservable
inputs †
Range
Weighted
average
range
Sensitivity
%
Sensitivity to
changes in
significant
unobservable
inputs
Recent
transaction price
#
3,338
n/a
a,b
n/a
n/a
n/a
n/a
† See explanation for other unobservable inputs below (sections ‘a’ to ‘d’ as relevant).
# Whilst a recent transaction price may be the most appropriate basis for a valuation, it will be corroborated by other techniques
which factor in the unobservable inputs noted in the above table.
* Significant unobservable inputs
The variable inputs applicable to a broad category of valuation basis will vary dependent on the
particular circumstances of a private company valuation. An explanation of each of the relevant
key variable inputs is provided below.
(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.
(b) Probability estimation of liquidation events
The probability of a liquidation event such as a company sale, or alternatively the
probability of the shares being treated as common stock, such as in the event of an initial
public offering (‘IPO’), is a key variable input in the Transaction-based and Multiples-
based valuation techniques. The probability of a common stock equivalent (‘CSE’)
outcome versus a company sale is typically estimated from the outset to be 50:50 as no
one outcome is more likely than the other. 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. The Company typically invests in higher ranking preference shares which carry
more protection, and this can therefore influence the end valuation. Option pricing
models are used to corroborate the valuations where there has been more notable
company underperformance to ensure that the economic reality of the shares held by
Baillie Gifford UK Growth Trust remain appropriate.
(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.
86
(d) 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 where
applicable.
Currency risk
Certain of the Company’s assets, liabilities and income could be 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 value of those items. This is
not considered a material risk for the Company.
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 has the power to take out borrowings, which give it access to additional funding
when required. The Company’s borrowing facilities are detailed in note 11.
Maturity profile
The maturity profile of the Company’s financial liabilities due in less than one year at 30 April
was:
2025
£’000
2024
£’000
In less than one year
– repayment of loans
24,350
16,350
– accumulated interest
344
190
– share buybacks awaiting settlement
351
411
– other creditors and accruals
424
835
25,469
17,786
Credit risk
This is the risk that a failure of a counterparty to a transaction to discharge its obligations under
that transaction could result in the Company 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 and then compared to the prospective investment
return of the security in question;
• 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 Bank of New York Mellon
(International) Limited. Bankruptcy or insolvency of the Custodian may cause the
Company’s rights with respect to securities held by the Custodian to be delayed. 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 bank
ensures that the counterparty to any transaction entered into by the Company has
delivered on its obligations before any transfer of cash or securities away from the
Company is completed;
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• 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, are 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 April was:
2025
£’000
2024
£’000
Cash and cash equivalents
823
1,917
Accrued income and prepaid expenses
1,737
1,622
Investment sales awaiting settlement
–
592
Other debtors and prepayments
39
28
2,599
4,159
None of the Company’s financial assets are past due or impaired and the risk to the Company is
considered low.
Fair value of financial assets and financial liabilities
The Company’s investments are stated at fair value and the Directors are of the opinion that the
reported values of the Company’s other financial assets and liabilities approximate to fair value.
19 Capital management
The objectives of the Company are to ensure that it will continue as a going concern and to
maximise the capital return to its equity shareholders through an appropriate level of gearing. Its
borrowings are set out on note 11 on page 81. The Company does not have any externally
imposed capital requirements. The capital of the Company is the ordinary share capital as
detailed in note 12. It is managed in accordance with its investment policy in pursuit of its
investment objective, both of which are detailed on page 28, and shares may be repurchased or
issued as explained on pages 44 and 45.
20 Non-adjusting post balance sheet event
At the last Annual General Meeting the Company was granted authority to purchase up to
21,590,578 ordinary shares (equivalent to 14.99% of its issued share capital), such authority to
expire at the 2025 Annual General Meeting. However, due to the level of buybacks in the period
since the last Annual General Meeting the Directors do not consider the existing authority
sufficient and have called a General Meeting for 3 July 2025 seeking shareholder approval to
renew the buyback authority earlier than would normally have been the case.
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Shareholder information
Notice of Annual General Meeting
The Annual General Meeting of the Company will be held at the 1 Moorgate Place, City of London,
EC2R 6EA on Wednesday 3 September 2025, at 12.00 noon.
If you have any queries as to how to vote or how to attend the meeting, please call us on 0800 917
2113.
Baillie Gifford may record your call.
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 as has been customary.
The Board encourages all shareholders to submit proxy voting forms as soon as possible and, in any
event, by no later than 12.00 noon on 1 September 2025. We would encourage shareholders to monitor
the Company’s website at bgukgrowthtrust.com. 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. 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.
Notice is hereby given that an Annual General Meeting of Baillie Gifford UK Growth Trust plc will be
held at 1 Moorgate Place, City of London, EC2R 6EA on Wednesday 3 September 2025 at 12.00 noon
for the following purposes.
89
Ordinary business
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 April 2025
with the Reports of the Directors and of the Independent Auditor thereon.
02. To approve the Directors’ annual report on remuneration for the year to 30 April 2025.
03. To declare a final dividend of 5.70p per ordinary share.
04. To re-elect Neil Rogan as a Director
05. To re-elect Andrew Westenberger as a Director.
06. To re-elect Ruary Neill as a Director.
07. To re-elect Cathy Pitt as a Director.
08. To elect Seema Paterson as a Director.
09. To re-appoint Ernst & Young 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 of the
Company.
Special business
To consider and, if thought fit, to pass Resolutions 11 and 14 as Ordinary Resolutions and Resolutions
12 and 13 as Special Resolutions.
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 £3,191,294.25, 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.
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 or
sale, 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
90
b. shall be limited to the allotment of equity securities or the sale of treasury shares up to an
aggregate nominal value of 3,191,294.25, being approximately 10% of the nominal value
of the issued share capital of the Company, as at 10 June 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 25 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
19,135,001, 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 is 25
pence;
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. an amount equal to the higher of the price of the last independent trade of an
Ordinary Share and the highest current independent bid for an Ordinary Share on
the trading venue where the purchase is carried out; 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 April 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, for the purposes of and in accordance with Article 96 of the Company’s Articles of
Association and with effect from 3 September 2025, fees paid to Directors for their services as
Directors of the Company shall not exceed in the aggregate £250,000 per annum.
By order of the Board
Baillie Gifford & Co Limited
Managers and Secretaries
3 July 2025
91
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 circular and 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
eproxyappointment.com/Login no later than 2 days (excluding non-working days) before the
time of the meeting or any adjourned meeting.
03. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy
appointment service may do so by using the procedures described in the CREST Manual 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 appropriate action 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. In this
connection, CREST members and, where applicable, their CREST sponsors or voting system
providers are referred, in particular, to those sections of the CREST Manual concerning practical
limitations of the CREST system and timings.
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
you attending the AGM and voting in person if you 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
92
they may cast), shareholders must be registered in the Register of Members of the Company no
later than 2 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.
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 no later than 22 July 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 (a matter of business). The request must have been received by the
Company not later than 22 July 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.
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 bgukgrowthtrust.com.
93
16. Members have the right to have questions raised at the meeting in accordance with section 319A
of the Companies Act 2006.
17. Any corporation which is a member can appoint one or more corporate representatives who may
exercise on its behalf all of its powers as a member provided that they do not do so in relation to
the same shares.
18. As at 10 June 2025 (being the last practicable day prior to the publication of this notice) the
Company’s issued share capital consisted of 127,651,777 ordinary shares, carrying one vote
each. Therefore, the total voting rights in the Company as at 10 June 2025 were 127,651,777
votes. Voting on the resolutions will be conducted by way of a poll. This will ensure an exact
and definitive result.
19. 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 complies with their respective disclosure obligations under the UK
Disclosure and Transparency Rules.
20. No Director has a contract of service with the Company.
94
Further shareholder information
Baillie Gifford UK Growth Trust plc 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 UK Growth Trust plc, you can 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 shares is quoted daily in the Financial Times and can also be found on the Company’s
page of the Managers’ website at bgukgrowthtrust.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 Baillie Gifford on request.
Baillie Gifford UK Growth Trust share identifiers
ISIN GB0007913485
Sedol 0791348
Ticker BGUK
Legal Entity Identifier 549300XX386SYWX8XW22
The ordinary shares of the Company are listed on the London Stock Exchange and their price is shown
in the Financial Times.
Key dates
Ordinary shareholders normally receive one dividend in respect of each financial year paid in
September. The Annual Report and Financial Statements are normally issued in July and the AGM is
held in September.
Share register enquiries
Computershare Investor Services PLC maintains the share register on behalf of the Company.
In the event of queries regarding shares registered in your own name, please contact the Registrars on
0370 703 0025.
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 and Stock Transfer forms.
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;
95
• 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 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/Login.
If you have any questions about this service please contact Computershare on 0370 703 0025.
CREST proxy voting
If you are a user of the CREST system (including a CREST Personal Member), you may appoint one
or more proxies or give an instruction to a proxy by having an appropriate CREST message
transmitted. For further information please refer to the CREST Manual.
Voting via an Investment Platform
If you are a shareholder who holds shares via a platform, you should be able to exercise your right to
vote by contacting the platform provider directly. You can instruct the platform how to vote your
shares or ask to be appointed as a proxy in respect of your shareholding should you wish to attend,
speak and vote at the Annual General Meeting. Further guidance can be obtained from your platform
provider or the Association of Investment Companies at the aic.co.uk/how-to-vote-your-shares.
Analysis of shareholders at 30 April
2025
Number of
shares held
2025
%
2024
Number of
shares held
2024
%
Institutions
43,381,757
33.6
42,761,097
29.1
Intermediaries/Retail Savings Platforms
71,326,275
55.2
85,619,970
58.4
Individuals
5,864,991
4.5
7,337,614
5.0
Marketmakers
8,701,787
6.7
10,959,826
7.5
129,274,810
100.0
146,678,507
100.0
These Financial Statements have been approved by the Directors of Baillie Gifford UK Growth Trust
plc. Baillie Gifford only provides information about its products and does not provide investment
advice. The staff of Baillie Gifford and Baillie Gifford UK Growth’s Directors may hold shares in
Baillie Gifford UK Growth and may buy or sell such shares from time to time.
Cost-effective ways to buy and hold shares in Baillie Gifford UK Growth Trust
Information on how to invest in Baillie Gifford UK Growth Trust can be found at
bgukgrowthtrust.com.
96
Communicating with shareholders
Trust magazine
Trust is the Baillie Gifford investment trust magazine which is published twice a year. It provides an
insight to 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 UK Growth Trust plc. Trust plays an important role in helping to
explain our products so that readers can really understand them. For a copy of Trust, please contact the
Baillie Gifford Client Relations Team (see contact details opposite).
You can subscribe to Trust magazine or view a digital copy 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 UK Growth Trust.
UK Growth Trust on the Web
Up-to-date information about Baillie Gifford UK Growth Trust plc, is on the Baillie Gifford
UK Growth Trust plc pages of the Managers’ website at bgukgrowthtrust.com. You will find full
details of Baillie Gifford UK Growth Trust plc, including recent portfolio information and performance
figures.
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.
97
Insights
UK Growth: opportunities amid tariff turbulence
How adaptable firms in growth-driving sectors can prosper over the long term despite trade
restrictions.
UK Growth Trust: Investing in the UK’s best growth companies
The UK Growth Trust’s approach to finding innovative companies, managing discounts and
capitalising on long-term trends.
Private investor forum: growth on sale
Why it pays to keep faith in the company fundamentals.
98
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, Baillie Gifford & Co Limited, is required to be made available
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 104). The numerical remuneration disclosures in respect of the
AIFM’s reporting period are available at bailliegifford.com.
Leverage
The Company’s maximum and actual leverage levels (see Glossary of terms and Alternative
Performance Measures on pages 100 to 102) at 30 April 2025 are shown below:
Gross method
Commitment
method
Maximum limit
2.00:1
2.00:1
Actual
1.05:1
1.05:1
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 will require investment trust companies to provide personal information to HMRC on
certain investors who purchase shares in investment trusts. As an affected company, Baillie Gifford
UK Growth Trust plc 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 Quick Guide: Automatic Exchange of Information –
information for account holders gov.uk/government/publications/exchange-of-information-
account-holders.
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
London Stock Exchange Group plc and its group undertakings (collectively, the ‘LSE Group’). © LSE
Group 2024 FTSE Russell is a trading name of certain of the LSE Group companies. ‘FTSE®’
99
‘Russell®’, ‘FTSE Russell®’, is/are a trade mark(s) of the relevant LSE Group companies and is/are
used by any other LSE Group company under license. All rights in the FTSE Russell indexes 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 indexes or data and no party may rely
on any indexes or data contained in this communication. No further distribution of data from the LSE
Group is permitted without the relevant LSE Group company’s express written consent. The LSE
Group does not promote, sponsor or endorse the content of this communication.
100
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 held less all
liabilities (other than liabilities in the form of borrowings).
Net Asset Value
Net Asset Value (‘NAV’) is the value of total assets less liabilities (including borrowings). The NAV
per share is calculated by dividing this amount by the number of ordinary shares in issue (excluding
treasury shares).
Net Liquid Assets
Net liquid assets comprise current assets less current liabilities, excluding borrowings.
Discount/premium (‘APM’)
As stockmarkets 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 per share it is said to be trading at a discount. The size of
the discount is calculated by subtracting the share price from the NAV per share and is usually
expressed as a percentage of the NAV per share. If the share price is higher than the NAV per share, it
is said to be trading at a premium.
2025
2024
Closing NAV per share
201.2p
193.0p
Closing share price
180.0p
163.5p
Discount
(10.5%)
(15.3%)
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
2025
share price
2024
NAV
2024
share price
Closing NAV per share/share price
(a)
201.2p
180.0p
193.0p
163.5p
Dividend adjustment factor*
(b)
1.0275
1.0317
1.0197
1.0226
Adjusted closing NAV per
share/share price
(c = a x b)
206.7p
185.7p
196.8p
167.2p
Opening NAV per share/share
price
(d)
193.0p
163.5p
195.6p
168.0p
Total return
(c ÷ d)-1
7.1%
13.6%
0.6%
(0.5%)
* The dividend adjustment factor is calculated on the assumption that the dividend of 5.60p (2024 – 3.60p) paid by the Company during the
year were reinvested into shares of the Company at the cum income NAV per share/share price, as appropriate, at the ex-dividend date.
Ongoing charges (APM)
The total expenses (excluding borrowing costs) incurred by the Company as a percentage of the
average net asset 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 71 is provided below.
101
2025
2024
Investment management fee
£1,442,000
£1,403,000
Other administrative expenses
£598,000
£568,000
Total expenses
(a)
£2,040,000
£1,971,000
Average net asset value
(b)
£287,088,000
£280,829,000
Ongoing charges ((a) ÷ (b) expressed as a percentage)
0.71%
0.70%
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 the
shareholders’ assets is called ‘gearing’. If the Company’s assets grow, the shareholders’ assets 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.
Invested gearing is the Company’s borrowings adjusted for cash and cash equivalents expressed as a
percentage of shareholders’ funds.
2025
2024
Borrowings
£24,350,000
£16,350,000
Less: cash and cash equivalents
(£823,000)
(£1,917,000)
Adjusted borrowings
£23,527,000
£14,433,000
Shareholders’ funds
£260,087,000
£283,153,000
Invested gearing
9%
5%
Drawn gearing is the Company’s borrowings expressed as a percentage of shareholders’ funds.
2025
2024
Borrowings
£24,350,000
£16,350,000
Shareholders’ funds
£260,087,000
£283,153,000
Drawn gearing
9%
6%
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. The Company’s maximum and actual leverage as at the year end are set out
on page 99.
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.
Unlisted (Private) Company
An unlisted (private) company means a company whose shares are not available to the general public
for trading and not listed on a stock exchange.
102
Sustainable Finance Disclosure Regulation (‘SFDR’)
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 UK
Growth Trust plc 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 stewardship 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.
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’s approach to sustainability can be found in the stewardship 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.
103
Company
information
Directors
Chairman: Neil Rogan
Ruary Neill
Seema Paterson
Cathy Pitt
Andrew Westenberger
Company Broker
Winterflood Investment Trusts
Riverbank House
2 Swan Lane
London
EC4R 3GA
Company details
bgukgrowthtrust.com
Company Registration No. 2894077
ISIN: GB0007913485
Sedol: 0791348
Ticker: BGUK
Legal Entity Identifier:
549300XX386SYWX8XW22
Alternative Investment Fund Managers and
Company Secretaries
Baillie Gifford & Co Limited
Calton Square
1 Greenside Row
Edinburgh EH1 3AN
T: +44 (0)800 917 2113
bailliegifford.com
Independent Auditor
Ernst & Young LLP
Atria One
144 Morrison Street
Edinburgh
EH3 8EX
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
Registrar
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol BS99 6ZZ
T: +44 (0)370 703 0025
Depository
The Bank of New York Mellon
(International) Limited
160 Queen Victoria Street
London
EC4V 4LA
Registered Office
3 St Helen’s Place
London
EC3A 6AB
bgukgrowthtrust.com
Calton Square, 1 Greenside Row, Edinburgh EH1 3AN
Telephone +44 (0)131 275 2000