Miton UK MicroCap Trust plc

Report and Accounts for the

year ended 30 April 2024

A Trust accessing the inherent

vibrancy of the UK’s quoted

microcaps

Contents

Strategic Report

i Financial Performance

Indicators

ii Results for the Year to 30April

2024

6 Chairman’s Statement

10 Investment Manager’s Report

15 Business Model

16 Costs of Managing theTrust

17 Portfolio Information

19 Performance and Risks

24 Share Capital

25 s172 statement

28 Management and OtherMatters

Governance

30 Directors

31 Report of the Directors

34 Corporate Governance

Statement

41 Audit Committee Report

44 Directors’ Remuneration Report

48 Statement of Directors’

Responsibilities

49 Independent Auditor’s Report

Company Accounts

56 Income Statement

57 Statement of Changes inEquity

58 Balance Sheet

59 Statement of Cash Flows

60 Notes to the Financial

Statements

Shareholder Information

Redemption of Ordinary Shares

Shareholder Information

AIFMD Disclosures

85 Notice of Annual General

Meeting

92 Glossary

95 Contact Details of the Advisers

The Trust’s strategy intentionally

focuses on UK-quoted microcaps…

One of the better indicators of an asset’s future return potential is the

valuation at the time of investment. Academics highlight that, on

average, assets starting at low valuations tend to deliver better returns

than those starting on relatively high valuations.

The Price to Book ratio* is a popular measure of stock market valuation,

with low metrics implying low expectations. In the scatter chart below,

the horizontal axis denotes the Price to Book ratio of each individual

UK-quoted company, with its market capitalisation shown on the vertical

axis. A logarithmic scale has been used on the vertical axis so that the vast

numbers of quoted microcaps can be appreciated.

The following scatter chart of the UK stock market details the range of

market capitalisations versus their Price to Book ratio, as a measure of

investors’ expectations.

UK-quoted microcaps have been overlooked for many years, and many

were already standing on undemanding valuations when the Trust

was first launched in April 2015. Over recent years, their valuations have

moved to even lower levels. The chart above underlines the extremely

low levels of UK-quoted microcaps valuations at present; this implies that

UK-quoted microcaps should be set to deliver unusually strong returns

infuture.

Irrespective of valuation, UK-quoted microcaps tend to outperform all

other quoted companies, due to the ‘small company effect’. Hence,

UK-quoted microcaps are currently set to outperform for two reasons:

their unusually low valuations, and the smaller company effect that is

amplified within microcaps.

Source: Morningstar

UK listed companies: valuation versus size

0 5 10 15

Market Cap (£ million)

Price to Book ratio (x)

£1tn

£100bn

£10bn

£1bn

£100m

£10m

£1m

Investment universe for the Miton UK MicroCap Trust

Miton UK MicroCap Trust plc | Annual Report 2024

* Price to Book ratio deﬁned in full in the Glossary on page 93.

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Three charts that help set the full year returns in the context of the longer term returns of the Trust. Throughout

this report we refer to Adjusted Net Assets (“Adjusted NAV”) which is the Statutory Net Assets (“Statutory NAV”)

presented in the financial statements adjusted to exclude the fair value of the warrants held by the Trust. The fair

value of warrants is calculated by Black Scholes. See Note 12 Fair Value Hierarchy Level 3 investments on page 72.

Source: Morningstar

This chart details the Adjusted NAV and the daily

closing share price of the Company. Prior to the Brexit

referendum, the share prices of microcaps generally

appreciated and the Adjusted NAV of the Trust rose.

Since then, many asset allocators have scaled back

their UK weightings, given the continuing uncertainties

after Brexit, and this has led to fewer buyers of small cap

stocks. This trend has been more pronounced amongst

microcap stocks, although the prospects for quoted

microcaps are often less dependent on global growth

than larger quotedcompanies.

Revenue and dividend per share

Adjusted NAV versus share price versus Deutsche Numis Smaller Companies 1000 Index

Source: Company from 30/04/2016 to 30/04/2024

The revenue per share of the Trust was relatively

strong in the early years due to some higher yielding

holdings. After these companies were taken over, and

reflecting portfolio changes, the underlying dividend

income of the portfolio has been at a lower level and

often similar to the revenue costs each year.

Overall, it has always been anticipated that the major

part of the Trust’s longer term returns would come via

capital gain rather than through dividendincome.

Average unweighted market capitalisation comparison: MINI versus Deutsche Numis Large Cap Index,

Deutsche Numis Smaller Companies ex ICs Index and Deutsche Numis 1000 ex ICs Index

Source: Premier Miton, Deutsche Numis, based on a logarithmic scale

The Trust pursues a clearly differentiated strategy,

illustrated by the fact that the average unweighted

market capitalisation of the holdings within its

portfolio is £53m, which compares to an average of

£23.7bn for the Deutsche Numis Large Cap Index,

£415m for the Deutsche Numis Smaller Companies

ex Investment Companies Index and £179m for the

Deutsche Numis 1000 ex Investment Companies

Index. The Trust’s portfolio may therefore produce

different returns from those of the mainstream stock

market indices.

Deutsche Numis

Large Cap

Index

(£23.7bn)

Deutsche Numis

Smaller Companies

Index

(£415m)

Deutsche

Numis SC 1000

Index

(£179m)

MINI

(£53m)

£1m

£10m

£100m

£10bn

£1bn

£100bn

Period from

26 March 2015

to 30 April 2016

Year to

30 April 2017

Year to

30 April 2018

Year to

30 April 2019

Year to

30 April 2020

Year to

30 April 2021

Year to

30 April 2022

Year to

30 April 2023

Year to

30 April 2024

Revenue per share (H1)

Revenue per share (H2)

Final dividend per share

0.6

0.5

0.4

0.3

0.2

0.1

-0.1

-0.2

Deutsche Numis

SC 1000 Index

100

150

200

250

MINI Share price

MINI Adjusted NAV

Apr-15

Oct-15

Apr-16

Oct-16

Apr-17

Oct-17

Apr-18

Oct-18

Apr-19

Oct-19

Apr-20

Oct-20

Apr-21

Oct-21

Apr-22

Oct-22

Apr-23

Oct-23

Apr-24

Percent

i | Miton UK MicroCap Trust plc | Annual Report 2024

Financial Performance Indicators

ii | Miton UK MicroCap Trust plc | Annual Report 2024

•

Over the year, the Adjusted Net Asset Value (“Adjusted NAV”) fell from 64.20p on 30 April 2023 to 55.79p on

30 April 2024, a negative total return, including dividends reinvested, of 12.9%.

•

The Ordinary Share price fell from 59.50p at 30 April 2023 to 50.50p at 30 April 2024, a negative return of

14.9%. As at close of business on 10 July 2024, the closest date to this Report, the Adjusted NAV was 54.84p

and the share price was 51.75p.

•

The net Revenue return was a positive return of £74,000 this year, or 0.09p per share. This compares to a

positive return of £32,000 last year, or 0.03p per share.

•

The Company does not have a formal benchmark but, for comparison, it is intended that the returns on

the Deutsche Numis Smaller Companies 1000 Index and the Morningstar Investment Trust UK Smaller

Companies sector will be published in the monthly factsheet and in the Company’s annual and interim

reports. Its returns, however, may diverge from these comparators for a significant period.

Results for the Year

to 30 April 2024

Summary of Results

Year to

30 April

2024

Year to

30 April

2023

Total net assets attributable to equity shareholders including fair value of warrants (£000) 43,297 60,754

Statutory NAV including fair value of warrants* 56.29p 64.20p

Adjusted NAV per Ordinary Share* 55.79p 64.20p

Share price 50.50p 59.50p

Discount to Adjusted NAV* (9.48)% (7.32)%

Investment income £0.9m £0.8m

Revenue return per Ordinary Share* 0.09p 0.03p

Total return per Ordinary Share including value of warrants (9.17) (28.93)p

Ongoing charges

* 1.99% 1.72%

Ordinary Shares in issue 76,923,603 94,638,561

* Alternative Performance Measure (“APM”). Details are provided in the Glossary on page 92.

# The ongoing charges are calculated in accordance with AIC guidelines.

Annual Report 2024 | Miton UK MicroCap Trust plc | 01

Our objective

The Trust invests principally in a portfolio of smaller UK quoted companies, generally with market

capitalisations of less than £150m. The primary objective is to generate capital growth through selecting

stocks that are expected to generate plentiful surplus cash in the short to medium-term. As this comes

through and their share prices appreciate sharply, the Investment Manager tends to take profits, with the

capital reinvested in other promising microcaps standing on overlooked valuations. Given that a major part

of the Trust’s return is expected to comprise capital appreciation, the Trust’s annual dividend (if any) will be a

modest contributor to long-term returns.

The Miton UK Microcap Trust plc is an investment trust quoted on the London Stock Exchange under the

ticker code MINI. The Board, which consists of four independent Directors, appoints the Investment Manager

and oversees all aspects of the Trust.

The Board oversees the Trust’s strategy to ensure it has the potential to deliver an attractive investment return

for shareholders over the longer term. The Trust’s portfolio is distinct from others in that it principally invests in

UK-quoted microcap companies, which are defined as those with market capitalisations of less than £150m.

Over recent years, enthusiasm for passive indexation strategies has enhanced returns at the larger end of

the market capitalisation range. This pattern has overwhelmed the usual ‘smallcap effect’ and, unusually,

microcaps have underperformed since the Trust’s launch. Whilst there have been some periods when large

caps have outperformed in the past, the more consistent trend since 1955 has been the smaller the market

capitalisation, the greater the return. Hence, when the stock market pattern normalises again, there is scope

for the Trust to deliver very strong uncorrelated returns.

In the year to April 2024 the Trust’s microcap holdings have underperformed, and its returns as detailed in the

bar charts below have been outpaced by larger companies within the comparative indices. Over the year, the

Trust’s Adjusted NAV total return (including dividend income) fell by 12.9%, which compares with a total return

on the Deutsche Numis Smaller Companies 1000 Index (the aggregate return of the smallest 2% of the UK

stock market) of 7.2%. Between April 2015 when the Trust was launched, and April 2024, its NAV total return

was 16.2%, which compares with a Deutsche Numis Smaller Companies 1000 Index total return of 55.3%.

Miton UK MicroCap Trust plc

Reportand Accounts for the year ended 30 April 2024

Source: Morningstar

Total returns 12 months to 30 April 2024 Total returns since launch in April 2015

Percent

Deutsche

Numis

All Share

Index

Deutsche

Numis

SC 1000

Index

Deutsche

Numis

Alternative

Markets

Index

MINI

Adjusted NAV

Deutsche

Numis

Smaller

Companies

Index

-20

-10

7.5

2.0

7.2

-6.2

-12.9

-10

Percent

60.8

45.4

55.3

12.0

16.2

Deutsche

Numis

All Share

Index

Deutsche

Numis

SC 1000

Index

Deutsche

Numis

Alternative

Markets

Index

MINI

Adjusted NAV

Deutsche

Numis

Smaller

Companies

Index

-20

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Recently, the UK stock market has broken

out on the upside, which may signal a new

stock market trend…

Since 1999, the UK stock market has largely missed out on the rise in global stock markets.

For the past 25 years, stock market trends have principally been driven by globalisation. Specifically, the surge

of low-cost imports has offset local inflation, and hence recent decades were characterised by lower interest

rates and higher asset valuations.

These trends favoured companies with rapid growth ambitions, especially those which were relatively large.

As both are widely represented within the US stock market, it has greatly outperformed. Meanwhile the UK

stock market, characterised by slower-moving, capital-intensive businesses, along with numerous mid and

smallcaps, has not performed so well.

Now that the UK stock market has broken out on the upside, this may presage a new period of

higherreturns.

Over recent years, the political climate has driven a fragmentation of international relationships, which has

been a hindrance to global franchises.

More recently still, asset valuations have come under pressure, with the cost of capital and debt now being

more costly. In these conditions, capital intensive businesses with tangible assets will tend to be subject

to less competition. These trends favour many UK mainstream stock market-quoted businesses, and it is

noteworthy that, since 2000, the market itself has recently broken out of its trading range, on the upside.

Given that the UK stock market is at a low point in valuation terms, this new trend of UK outperformance

could be dramatic and perhaps persist for many years.

02 | Miton UK MicroCap Trust plc | Annual Report 2024

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Annual Report 2024 | Miton UK MicroCap Trust plc | 03

UK quoted microcaps tend to outperform and, given their recent period of weakness we believe they are

overdue a major performance catch-up.

Academic studies of past stock market data have found a consistent pattern where, on average, the smaller a

quoted company, the better its long-term returns. Generally, quoted microcaps typically deliver the best long-

term returns.

There are intervening periods when mainstream stocks have a phase of performance catch-up or are subject

to a series of high-profile takeovers. But, as these pass, the pattern typically reverts to the norm. Thus, given

the ubiquitous nature of the smallcap effect, after their recent underperformance, microcaps appear overdue

a major period of performance catch-up.

Whilst microcaps generally outperform, there are always a few that deliver exceptional returns several

years in a row.

Whilst most quoted companies generate yearly returns that are crowded around the median, there are

always a few that conspicuously disappoint, together with some standout winners that rise by a multiple of

their share price over a couple of years. Whilst there are some isolated large cap examples that appreciate by

a multiple of their share price over a year, these are rare. By contrast, there is normally a short list of microcaps

that achieve this level of return eachyear.

As the share prices of successful microcap businesses appreciate by multiples, the companies themselves

come to the attention of a wider range of institutional investors. Hence these exceptional returns can

sometimes persist for several years, as an increasingly wider range of investors include them in portfolios.

Overall, if the UK stock market has broken out on the upside, then in time it should be matched by a similar

break out of UK-quoted microcaps.

…then, in time, it should be matched by a

smiliar break out of UK-quoted microcaps.

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Any organisation that knowingly operates contrary to the interests of the wider public will, in time, find that

its social licence to operate suffers. Hence, well managed investment portfolios need to invest in companies

with an authentic sense of purpose, as well as those employing a successful commercial strategy.

Mainstream stocks have vast numbers of shareholders, so typically their executive directors only meet a

small proportion of them. Alongside their long list of shareholders, they are offered an extraordinarily wide

range of advice regarding their stance on corporate strategy and environmental, social and governance

issues. The bottom line is that institutional investors have little opportunity to gauge the authenticity of the

management team’s sense of purpose or to influence their corporate agenda significantly.

In contrast, there are far fewer institutional microcap investors, so most microcap management teams

are keen to meet them, even when they are not shareholders. Microcap investors, therefore, have a much

greater opportunity to gauge a company’s culture, even prior to investing. In addition, institutional holders

typically account for a substantial proportion of their equity, so when these holders express opinions they

often have a meaningful influence on how the management teams address issues, including those related to

environmental, social and governance policy.

Furthermore, when addressing

environmental, social and governance

issues…

04 | Miton UK MicroCap Trust plc | Annual Report 2024

Annual Report 2024 | Miton UK MicroCap Trust plc | 05

AIM-listed companies do issue formal reports covering non-financial metrics such as climate data or

gender diversity, although these are typically less comprehensive than the majors. Your Manager does

not find this a major handicap as many microcaps operate across a relatively specialist business area. In

addition, your Manager can compare the content of the sustainability reports with the detail of the senior

management’s actions gathered through one-to-one meetings. When variance is identified, it can imply a

lack ofauthenticity. As one example, your Manager meets many mining management teams who say they

start every meeting withsafety. And yet, in far too many cases, their safety data is not covered by the first slide

in their corporate presentation, nor is safety the first matter of substance in their annual report.

Generally, microcap leadership teams are smaller, and often more agile than the majors. Typically, this is

reflected in a stronger sense of corporate purpose and greater sense of motivation than in some larger

companies. For these reasons, when addressing environmental, social and governance issues, the Manager of

a portfolio of microcaps can stand at an advantage when compared to those investing in themajors.

…a UK microcap portfolio

has numerous advantages.

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Ashe Windham

Chairman

The report covers the full year to 30 April 2024, a

period which was, in football parlance, a game of two

halves. In the first half to end of October 2023, the

Trust’s Adjusted Net Asset Value (“Adjusted NAV”) fell

by 15.5%, from 64.20p to 54.10p. The second half saw

a tentative recovery with the Adjusted NAV rising by

3.1% to 55.79p. This somewhat anaemic return was

greatly outpaced by other indices, as local selling

was offset hardly at all by few corporate buybacks

within microcaps, and which led to UK-quoted

microcap valuations declining even further. Over

the period as a whole, therefore, the Trust’s Adjusted

NAV fell 12.9%, compared to a rise in the Deutsche

Numis Smaller Companies 1000 Index of 7.2%. The

vast majority of UK microcaps were already standing

on unusually low valuations even prior to their share

price weakness over this past year. The low average

Price to Book of holdings in the portfolio highlights

the value to be found in owning shares in the Trust.

Earnings and Dividends

Earnings for the year, after costs, were 0.09p

per share (2023: 0.03p) on the revenue account.

Earnings on the capital account consisted of

a loss of 9.26p per share (2023: loss of 28.96p).

Earnings on the revenue account remain

depressed as microcap companies seek to retain

cash rather than paying it out in dividends to

shareholders. As far as setting the dividend is

concerned, the Directors have always given the

Manager maximum flexibility to follow which

ever course is believed to lead to the best results

for our shareholders. As Directors, we regard

the dividend as a useful by-product of the

investment process but not a target in itself.

This year, your Board is recommending a final

dividend of 0.09p per ordinary share, reflecting

the revenue for the year. Subject to approval by

shareholders at the AGM, this will be paid on

25October 2024 to shareholders on the register

on27September2024.

Performance

With the dearth of buying interest in UK

microcaps over the last three years, marginal

sellers have dominated the direction of share

prices. Every excuse in the book has been rolled

out for why institutions and individuals should

not buy UK equities – a close Scottish referendum,

Brexit, four Prime Ministers in five years, the

UK’s lack of exposure to technology stocks, an

egregious 0.5% stamp duty on the purchase of

equities not paid by investors in other first world

stock markets, the sudden imposition of an

additional tax on North Sea oil producers, a major

land war in Europe and the ongoing conflict in the

Middle East. To add insult to injury, the investment

trust sector has been discriminated against by

the iniquitous double counting of fees such that

wealth managers find real difficulties explaining

why they should be buying closed end vehicles

for their clients, given the apparently high level

offees.

“ …it is hard to overstate the scale

of the current upside potential for

the Miton UK Microcap Trust in

absolute terms…”

Chairman’s Statement

06 | Miton UK MicroCap Trust plc | Annual Report 2024

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Annual Report 2024 | Miton UK MicroCap Trust plc | 07

Given the continuing mergers of wealth managers,

the barriers to liquidity are now so high that in

order to attract the selector’s eye, investment

trusts need to have market capitalisations of

£1bn+. There are precious few of those around.

The Association of Investment Companies (AIC)

is trying to get the Financial Conduct Authority

(FCA) to reverse the cost disclosure position but the

latter does not appear to grasp the urgency, whilst

the government seems unable to appreciate the

seriousness resulting from the UK falling from its

position as the premier global centre for finance.

Many large companies are voting with their feet,

seeking listings in the US, where valuations are far

higher and the climate more benign – even the

mighty Shell is contemplating such a move.

At the end of April, for example, it was reported that

Coutts & Co. was cutting its UK equity allocation by

almost £2bn from 33% to 2%, even below the UK’s

now feeble 3% weighting in global equity indices.

The consequence is that UK equities are almost

wholly unloved and, as at the end of April 2024, were

trading on 12x forward price earnings ratio vs the

world on 17x and the US on 21x, (source: Bloomberg).

The Price to Book ratios are even more extreme with

the UK on 1.6x, the world on 2.7x and the US on a

lofty 4.4x, whilst the UK also offers a meaningfully

higher dividend yield at 3.8% than both the US (1.4%)

and world markets (2.1%). I thought that the nadir

of selling of UK equities was reached a year ago but

I was sadly mistaken; as the chart below shows the

rate of selling has in fact accelerated. Capitalism

abhors a vacuum and the recent high and rising

level of corporate take overs of listed companies

demonstrates the value to be found in the UK. Canny

contrarians are buying UK equities at what appear to

be knock down prices.

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Net retail sales of UK Equity Funds

Source: The Investment Association

-15

-10

-5

£4.9bn

£2.7bn

(£5.4bn)

(£2.8bn)

(£4.8bn)

(£2.2bn)

(£3.2bn)

(£5.3bn)

(£11.9bn)

(£13.6bn)

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Investment £billion

(£2.7bn)

2013

Prospects

The last three years have been incredibly frustrating

for the management teams of numerous UK quoted

companies and for our shareholders. UK microcap

share prices have steadily declined, even whilst the

underlying companies have often continued to

deliver results in line with expectations.

Whilst this is disappointing, the Trust was set up

because quoted microcaps possess extraordinary

upside potential. When microcaps succeed,

sometimes their share prices can appreciate very

dramatically. We liken this to an option-value upside,

where the term of the option is open-ended, and its

cost comes almost for free, embedded within the

quoted microcap share price.

Currently the media is marvelling because Nvidia

has delivered an annualised return of 86% in sterling

terms over the last four years. And yet, the Trust’s

holding in Yü Group (a microcap exemplar), has

appreciated at an annualised rate over the same

period of 130%. In short, Yü Group’s share price has

risen some 27-fold, compared with Nvidia which has

risen 11-fold.

Chairman’s Statement continued

Furthermore, after Nvidia’s rise, it has moved up to

a high-expectation valuation (Price to Book of 51.8x),

whereas Yü Group is still on a modest valuation

– even now its Price to Book is only 6.2x. Thus, Yü

Group still retains bags more upside potential, even

in the short-term.

Microcap share prices generally have been

severely repressed over the last three years, so

these abnormally large upsides have been more

infrequent. To catch the discerning investor’s eye,

small stocks have to be exceptional. Yü Group is a

good example and is currently one of the multi-

baggers in the Company’s portfolio.

Hopefully, by the time that you read this, the green

shoots in UK equities which started emerging in

mid-April, will have blossomed into something more

substantial. The UK is now officially out of recession

and ‘animal spirits’ are evident. After largely flatlining

since 2000, the UK stock market has recently broken

out on the upside. Rather similar to the Japanese

stock market, we believe this is the start of a new

longer-term trend. In our view, the mainstream UK

stocks are now set to enter a period when they will

outperform their international comparators.

But the greatest upside potential has always lain

within UK-quoted microcaps – and they now are

starting from shockingly low valuations. Those that

succeed from here have the potential to perform so

much better than large caps. The old stock exchange

adage that ‘Elephants don’t gallop’ is normally the

rule. If the UK stock market itself may be starting

a long-term trend of outperformance, and if UK

microcaps outperform the UK majors as they have

done historically, then they are set to outperform

international comparatives.

In conclusion, it is hard to overstate the scale of the

current upside potential for the Miton UK Microcap

Trust in absolute terms, as well in the context of

other equities internationally.

Share Issuance

As the shares did not trade at a premium to the

prevailing Adjusted NAV during the year under

report, there were no opportunities to issue

shares. We will be seeking approval at the AGM

in September 2024 to renew this useful facility.

Issuing shares at a premium to Adjusted NAV is to

the benefit of all shareholders as it dilutes the fixed

charges which the Company bears and thus lowers

the Ongoing Charges Figure (“OCF”).

Share Redemption

Each year your Directors offer the facility for

shareholders to redeem their holdings in part or

whole, at or close to the prevailing Adjusted Net

Asset Value. The Directors are offering this facility

again this year and the timetable is laid out on

page 80 of this report. Should the redemption

be substantial, then the Directors may take the

decision to form a separate redemption pool, as we

did last year, and it may take a number of weeks, if

not months, to liquidate the pool carefully without

disadvantaging the remaining shareholders, or

indeed the exiting ones. Thanks to microcaps having

been out of favour for almost three years, the Trust

has suffered heavy redemptions over each of the

last two years, being 13.4% in 2022 and 18.7% in 2023.

We have in place an agreement with the Trust’s

managers, Premier Miton, that they will rebate their

ongoing management fee to the extent required

for the Trust to maintain an ongoing charges ratio

of no more than 2%. The Trust thus has the facility to

remain viable at a lower level of market capitalisation

than most investors would believe possible. It is also

worth noting that Premier Miton’s fee is based on

the Trust’s market capitalisation and not its Adjusted

NAV, which, when it is trading at a significant

discount, is of material benefit to shareholders.

Board Refreshment

Your Directors have a policy that a non-executive

Director should serve for no more than nine years,

from the date of first election. A well-structured

waterfall of directors’ retirements is always difficult

when coming after a company has been launched,

08 | Miton UK MicroCap Trust plc | Annual Report 2024

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Annual Report 2024 | Miton UK MicroCap Trust plc | 09

as directors should retire nine years after the first

election by shareholders. Davina Walter took over

from Peter Dicks as Senior Independent Director

on 1 May 2024. Louise Bonham will take over from

Peter on 1 September 2024 as Chair of the Audit

Committee, whilst Peter will be on hand to help with

the redemption process and with the interim results

until he retires from the Company at the end of

December 2024.

Environmental, Social and Governance (ESG) issues

Your Manager follows Premier Miton’s responsible

investing policy, which is to consider Environmental,

Social and Governance issues and actively to

engage in the investment process with investee

companies, in order to deliver improved outcomes

for all stakeholders and to take an active approach

to voting on company resolutions at annual general

meetings of investee companies. Premier Miton has

been a signatory of the UN Principles for Responsible

Investment since January 2020, an organisation

which encourages and supports its signatories

to incorporate ESG factors into investment and

ownership decisions. Premier Miton also adopts a

banned weapons exclusion and utilises third party

data to maintain a list of suchcompanies.

Change of Service Providers

As reported in the interim report, following due

process, evidenced by extensive due diligence and

interviews, on 4 March 2024, the Trust appointed

subsidiaries of Northern Trust as company secretary

and registered office, fund administrator and

depositary, resulting in considerable savings

forshareholders.

Annual General Meeting

The Annual General Meeting of the Trust will be

held at 11.30am on Tuesday 24 September 2024

at the offices of Stephenson Harwood, 1 Finsbury

Circus, London EC2M 7SH. Your Directors look

forward to this opportunity to meet shareholders

and especially retail investors, as there are few other

opportunities to engage with the latter. Aside from

the formal business of the AGM, Gervais Williams

and Martin Turner will give a presentation on the

Trust’s prospects and at the end of proceedings we

will be offering a sandwich lunch. We hope that as

many shareholders as possible will be able to attend

and would encourage those wishing to do so to

on the Trust’s website, www.mitonukmicrocaptrust.

com, in the preceding six weeks. There you will also

find additional details regarding the Trust including

factsheets and a range of regularly updated videos,

podcasts and articles.

In conclusion, as I wrote in my last report, the

Directors are grateful for your tolerance in holding

the Trust’s shares over what has been a fairly dismal

period and we are hopeful that your patience will be

amply rewarded in the not-too-distant future. Two

of your Directors added materially to their holdings

over the year, demonstrating their confidence in the

long term prospects for the Company.

Ashe Windham

Chairman

11 July 2024

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Which fund managers have day-to-day

responsibility for the Trust’s portfolio?

Since the launch of the Trust in April 2015, the day-

to-day management of the Trust’s portfolio has

consistently been carried out by Gervais Williams

and Martin Turner.

Gervais Williams

Gervais joined Miton in March 2011 and is Head of

Equities at Premier Miton. He has been an equity

fund manager since 1985, including 17 years at

Gartmore. He was named Fund Manager of the Year

by What Investment? in 2014. Gervais is President of

the Quoted Companies Alliance and a member of

the AIM Advisory Council.

Martin Turner

Martin joined Miton in May 2011. He and Gervais have

had a close working relationship since 2004, with

complementary expertise that led them to back a

series of successful companies. Martin qualified as

a Chartered Accountant with Arthur Anderson and

had senior roles and extensive experience at Merrill

Lynch and Collins Stewart.

What were the principal stock contributors and

detractors in the portfolio over the year to April 2024?

Over the last three years, including throughout the

year to April 2024, institutional investors have sought

to reduce their holdings of UK equities, so that

capital could be invested elsewhere. Hence, there

have been persistent sellers of microcap shares that

have often outnumbered the buyers, such that most

microcap share prices have fallen, even when their

prospects remained unchanged.

However, occasionally, the prospects of a quoted

microcap improve so significantly that even though

its share price might appreciate by many multiples,

its valuation still remains relatively modest. With

the overhang of quoted microcaps sellers, this

outcome has been somewhat more frequent than

usual this year. The best example in this period

was Yü Group, which appreciated three-fold over

the year to April 2024 and yet still stands on an

overlooked valuation. Whilst the Trust’s holding in

Yü Group was trimmed to keep its percentage of

the portfolio below 10%, it still appears to have an

unusually attractive risk/reward ratio at its current

share price. Serabi Gold, a gold mining company in

Brazil, was somewhat similar, having appreciated

by 130% over the year.

Given the generally unfavourable background,

the share prices of portfolio holdings that chose

to raise additional capital were often particularly

weak. A good example is CyanConnode, a market

leader in Indian smart meters. The Trust held this

in its portfolio because the Indian government is

tendering to install 250 million meters over the

coming years. In November 2023, the company

raised £2.5m to increase its component inventory,

anticipating that this would help it to win a larger

proportion of its tenders. Even though CyanConnode

has continued to meet market expectations, with the

additional share issuance, its share price fell 53% over

the year to April 2024. Whilst corporate prospects

may have been enhanced by raising additional

capital, the holding was the worst detractor in terms

of the Trust’s Adjusted NAV return this year.

Alongside, there are always a number of portfolio

holdings where prospects deteriorate, and which

are therefore sold from the portfolio, typically

crystalising losses. This year the most significant of

these were Cap-XX, Ethernity Networks, FireAngel,

Graft Polymer, MusicMagpie, Saietta and Velocys. In

addition, the management team of Accrol Group

recommended a takeover offer, even though it was

only at a modest premium to its share price. They

feared global competition setting up in the UK

would degrade their profitability.

In a normal year, when buyers and sellers of

microcap holdings are in balance, there will

always be a number of microcap share prices

that appreciate significantly. With microcap

transactions being out of balance, however, these

were comparatively scarce in the year under review.

In addition, even microcaps that excelled did not

necessarily appreciate in valuation as much as might

be expected. Even so, where valuations of individual

holdings moved well above others, these were sold,

Investment Manager’s Report

10 | Miton UK MicroCap Trust plc | Annual Report 2024

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giving the potential to reinvest capital in other stocks

standing on extremely overlooked valuations. For

this reason, positions in Corero Network Securities,

DX Group, Journeo, Oxford BioDyanmics, React

Group and Sureserve were sold during the year.

In summary, with the persistent sellers of microcap

shares over the year to April 2024, their share prices

have been unusually weak even when their prospects

remained unchanged. This is the principal reason why

the Adjusted NAV of the Trust fell 12.9% over theyear.

What are the main factors that have driven the

Trust’s returns since it ﬁrst listed in April 2015?

As highlighted in previous annual reports, the best

performing part of the UK stock market since 1955

(the start of the relevant data series) has been the

microcap sector.

When the investment universe is narrowed

further, solely to include microcaps standing on

undemanding valuations (typically determined

by low Price to Book ratios), the scale of their

outperformance is even more marked. With this

background in mind, the Trust’s portfolio principally

invests in UK-quoted microcaps standing on what

we consider to be overlooked valuations at the time

of purchase. When these microcaps succeed, their

share prices can appreciate by many multiples of the

purchase price.

The globalisation trend was already declining when

the Trust was set up in April 2015, and we anticipated

that it would gradually fade. Whilst economic trends

have indeed evolved as expected, governments

and central banks have been fearful of unwinding

the debt burden, so have adopted unconventional

policies to keep the prior stock market status quo in

place. This has led to perverse outcomes. Whereas

the smaller company effect is near-ubiquitous,

recent policy gymnastics have boosted megacap

outperformance dramatically. Although this pattern

is likely to prove unsustainable over time, it has

had the unwelcome side effect of making market

conditions for quoted microcaps increasingly hostile

since the Trust’s listing in April 2015.

Over recent years, the cost of raising additional

microcap capital has typically become far more

onerous, as investors have become increasingly

cautious about committing additional capital to

assets that continue to underperform. Thus, quoted

microcaps seeking to raise additional capital

have either contemplated issuing new shares at a

discount to their subnormal valuations or chosen

to live without additional capital. While issuing

additional capital typically enhances prospects,

many microcaps have preferred to grow at a slower

pace over recent years rather than issue heavily

dilutive new capital. Microcaps that have run out

of cash meanwhile have often been obliged to

raise new capital irrespective of its dilutive effect.

In these cases, the prospective returns for existing

shareholders will have been downgraded, other

than for those that invested additional capital and

therefore maintained their percentage ownership.

For these reasons, over the nine years since issue, the

share prices of many UK-quoted microcaps in the

Trust’s portfolio have suffered a valuation headwind,

even amongst those that were successful. Those that

disappointed have typically delivered poorer returns

than normal.

In spite of these severe microcap headwinds, the

Adjusted NAV of the Trust has nevertheless modestly

risen since inception in April 2015, and outperformed

the return of the Deutsche Numis Alternative Markets

Index. Whilst the portfolio does include a list of

holdings that have delivered poor returns, there are

many others that have generated excellent returns

despite the adverse microcap conditions. Further

up the market capitalisation scale, conditions have

typically been less hostile, which explains why the

returns of the comparative indices are generally

better than that of the Trust’s Adjusted NAV total

return. In addition, the returns of larger market

capitalisations stocks by definition have larger index

weightings, and hence skew the overall return of

the comparative indices further upwards when

theyoutperform.

Investment Manager’s Report continued

In the light of the substantial decline in the Trust’s

Adjusted NAV over the last three years, have its

longer-term prospects deteriorated?

The period of globalisation can be characterised

as favouring ‘bigness’, which may explain why the

US stock market has greatly outpaced others over

recent decades. During globalisation, the valuations

of other exchanges such as the UK have trailed

behind the US comparatives. This position is even

more extreme within UK-quoted microcaps, where

over the last three years valuations have fallen to

what we consider to be absurdly low levels.

Over the last decade or so however, the electorate

has come to distrust the compromises that come

with globalisation. This was evident as long ago as

2016 with the Brexit and Trump votes. Thereafter, the

logistics nightmares of the pandemic have made the

compromises that come with globalisation all the

more prominent, and electoral pressure for change

has become more persistent.

Beyond globalisation, policies such as reshoring

manufacturing, which tend to boost inflation, are

expected to lead to a much more challenging

economic outlook. Interestingly, we believe changes

like this favour companies funded with risk capital,

such as those listed on stock markets, over those

principally funded by debt, like private equities.

Total returns of the Trust and various comparative

indices since launch in April 2015

Quoted companies generating cash surpluses

(such as those that dominate the UK mainstream

stock market) now have the potential to outperform

greatly. In this context, we are not surprised that

this is the moment when the mainstream UK

stock market has broken out of its trading range

on the upside. This is all the more significant given

that it has done so at a time when numerous local

investors have been aggressively reducing their UK

equity weightings. Breakouts such as that of the

UK tend to bring in new participants from overseas,

boosting the outperformance trend further. As local

selling moderates and in time ceases, we anticipate

the new UK outperformance trend will accelerate

further and become persistent.

Furthermore, we also anticipate that market trends

will start to favour small cap stocks over large ones,

in which the UK exchange is better represented

than most other markets. Hence, far from being

worried about the Trust’s prospects deteriorating

after its recent underperformance, we believe its

upside potential is now even greater than before,

and more immediate. In part, this is due to UK-

quoted microcaps standing on absurdly low

valuations, but also because we anticipate that the

current political and geopolitical trends will favour

UK-quoted equities, and most particularly UK-

quoted microcaps in future.

Will institutional investors ever return to the UK

quoted microcap investment universe?

Inflationary pressures were benign during the period

of globalisation, and asset valuations in general

rose considerably. In addition, the opening up of

international trade also enhanced world growth,

so most businesses expanded. Overall, the returns

of many assets have been unusually strong during

globalisation.

As the favourable pattern persisted over decades,

stock market returns were routinely well above

inflation, and additional returns from smallcap

portfolios became apparently optional for

institutions. Indeed, institutions progressively

favoured concentrating capital in large and

Source: Morningstar

Percent

60.8

45.4

55.3

12.0

16.2

Deutsche

Numis

All Share

Index

Deutsche

Numis

SC 1000

Index

Deutsche

Numis

Alternative

Markets

Index

MINI

Adjusted NAV

Deutsche

Numis

Smaller

Companies

Index

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megacap equities because they came with

abundant market liquidity. Hence, although quoted

smallcaps may have outperformed the majors

during globalisation, the commercial returns from

all sorts of mainstream assets were so copious

that most institutional investors steadily reduced

their smallcap participation. The adverse pattern

has been most pronounced within the UK-quoted

microcap investment universe, where the vast

majority of capital is now provided by private

investors. Amongst institutional investors, even

those with dedicated UK smallcap strategies now

routinely disregard quoted companies below a

minimum market capitalisation, say, of £150m.

Recent elections have led to a Balkanisation of

international relationships, and globalisation is

now in retreat. There are fewer opportunities to sell

goods across all international geographies, which

constrains opportunity for many global businesses.

Furthermore, the reshoring of manufactured goods,

and greater immigration controls add to inflationary

pressures, and hence are also expected to reduce

asset valuations. The return on mainstream stock

markets by implication may be much poorer in

the future. Given that many quoted megacaps are

currently standing on incredibly high valuations,

many stock markets around the world may fail to

deliver a commercial return for many years.

Even if UK-quoted microcaps were to start

outperforming very substantially over the

coming quarters, we doubt that institutions

would immediately crowd into them. However,

if the mainstream indices were to fail to deliver a

commercial return for a long period, in time we do

expect institutional capital to be reallocated into

areas that are outperforming.

The smallcap investment universe is typically

defined as comprising the bottom ten percent of

market capitalisations of the overall stock market,

so an allocation from the large cap ninety percent,

into the smallcap ten percent tends to amplify

its performance. Furthermore, as microcaps are

typically defined as being the bottom two percent,

Number of quoted companies in the UK below and

above £150m market capitalisation

an allocation from the large and smallcap ninety-

eight percent into the microcap two percent can

be expected to have an even greater amplification

impact on performance. Alongside, as UK

mainstream companies have fallen to undemanding

valuations during globalisation, and UK-quoted

microcaps have fallen to absurdly low valuations, the

new outperformance trends have the potential to

persist in scale for years.

For all these reasons, we expect UK-quoted

microcaps to outperform greatly global large and

megacaps, in a new trend that is boosted further

by institutional capital being allocated increasingly

further down the market capitalisation range.

Even a tiny incremental allocation of institutional

capital would have a major impact on UK-quoted

microcap returns. And as the cost of microcap

capital becomes less onerous, we foresee they

will enhance their returns yet further through

share issuance. Over time, the more that quoted

microcaps outperform, the greater will be the

willingness of institutional capital to participate. We

anticipate something of a virtuous spiral from here,

with additional institutional capital allocations being

matched by an accelerating pattern of UK-quoted

microcap outperformance in a new trend that could

last for decades!

Number of companies

Below £150m Above £150m

100

200

300

400

500

600

£2,296bn

combined

market

capitalisation

£14bn

combined

market

capitalisation

Source: Premier Miton

What are the prospects for the Trust?

In the sections above, we outline why we believe

the current political and geopolitical trends are

now set to favour quoted equities and specifically

UK-quoted equities from here. In addition, we also

outline why we believe market trends will now start

to favour smallness over bigness. When these factors

are set in the context of UK-quoted microcaps that

are currently standing on unusually low valuations,

the reasoning for being upbeat about the Trust’s

prospects should beobvious.

Even after setting out these arguments however,

we believe that the full upside potential of the

Trust’s strategy is still not fully captured. The issue

is that investors’ expectations are currently framed

in the context of a stock market that has become

increasingly hostile towards UK-quoted microcaps.

Investors may gauge the ultimate upside potential of

the Trust with reference to the return from a holding

such as Yü Group, whose share price has appreciated

21-fold between first purchase in May/June 2020 and

the end of April 2024. This is twice as fast as that of

Nvidia for example (by far the best performing US-

listed member of the Magnificent Seven over that

period) and hence may be assumed to represent a

UK-quoted microcap at its best.

And yet, when UK-quoted microcap market

conditions are less hostile, microcaps like Yü Group

may have even greater upside potential. To repeat,

many UK-quoted microcaps currently stand on very

overlooked valuations. So, even after Yü Group’s

astronomical returns, for example, its Price to Book

ratio is still only 6.2x, whereas that of Nvidia is over

50x (even though it has delivered lesser, though still

stellar, returns). In short, without wishing to debate

the relative investment merits of Yü Group versus

Nvidia, we believe that if Yü Group’s share price were

to rise to a valuation that fairly reflects its prospects,

it would offer plenty of upside potential from here. As

it is, following its recent deal with Shell, YüGroup no

longer needs to commit tens of millions of pounds

in cash collateral when it hedges the energy price for

its customers. With Yü Group’s collateral constraints

now lifted, it can now take the brakes off its full

growth potential and hence a potential valuation

that fairly reflects its prospects may now be even

greater than it was a few monthsago.

The bottom line is that when UK-quoted market

conditions become less hostile, we anticipate that

the Trust’s returns have considerable potential. There

was a glimpse of its scale when, over only a fourteen-

month period, the Trust’s Adjusted NAV rose from

37.28p on 19March 2020 to 107.5p on 10 May 2021.

Now that the mainstream UK stock market has

broken out of its historic trading range on the

upside, we believe that local market conditions

are improving. Stock market breakouts tend to

bring in new participants from overseas, boosting

the outperformance trend further and help it

become embedded. When institutional capital

starts to be allocated further down the market

capitalisation range, market conditions within

UK-quoted microcaps will normalise again and

investors should start to recognise the full potential

of the Trust’s strategy. The key point is that even tiny

increments of institutional capital have the potential

to make a giant difference to UK-quoted microcaps

market conditions, and hence the scale of their

returnpotential.

In summary, the Trust’s strategy seeks to pick out

stocks that have the potential to appreciate by many

multiples of the original share price, and in our view

the prospects for the Trust’s UK-quoted microcap

strategy are now the best they have been for over

thirty years. Enough said.

Gervais Williams and Martin Turner

11 July 2024

Investment Manager’s Report continued

14 | Miton UK MicroCap Trust plc | Annual Report 2024

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Business Model

Business and status the Company

MINI was incorporated on 26 March 2015 and its

Ordinary Shares were listed at 50p on the London

Stock Exchange on 30 April 2015. It is registered

in England as a public limited company and is

an investment company in accordance with the

provisions of Sections 832 and 833 of the Companies

Act 2006.

The principal activity of the Company is to carry

on business as an investment trust. The Company

intends at all times to conduct its affairs so as to

enable it to qualify as an investment trust for the

purposes of Sections 1158/1159 of the Corporation Tax

Act 2010 (“S1158/1159”). The Directors do not envisage

any change in this activity for the foreseeable future.

The Company has been granted approval from HM

Revenue & Customs (“HMRC”) as an investment trust

under S1158/1159 and will continue to be treated as an

investment trust company, subject to there being no

serious breaches of the conditions for approval.

The principal conditions that must be met for

continuing approval by HMRC as an investment trust

are that the Company’s business should consist of

“investing in shares, land or other assets with the aim

of spreading investment risk and giving members

of the company the benefit of the results” and the

Company may only retain 15% of its investment

income. The Company must also not be a close

company. The Directors are of the opinion that

the Company has conducted its affairs for the year

ended 30 April 2024 so as to be able to continue to

qualify as an investment trust.

The Company’s status as an investment trust allows

it to obtain an exemption from paying taxes on the

profits made from the sale of its investments and

all other net capital gains. Investment trusts offer

a number of advantages for investors, including

access to investment opportunities that might not

be open to private investors and to professional stock

selection skills at lower cost, and the ability to hold

illiquid positions in uncertain market conditions.

Investment Policy

The Company’s full investment policy is set out on

page 81 and contains information on the policies

which the Company follows relating to asset

allocation, risk diversification and gearing, and

includes maximum exposures, where relevant.

The Company invests in a portfolio of UK quoted

companies with the objective of achieving capital

growth by investing in a portfolio of stocks that are

well placed to generate an attractive cash payback

from productivity improvements.

Investment trusts differ from some other forms

of collective funds in that they are set up as

independent corporations with their operations

overseen by a board which is separate from and

independent of the fund management group that

manages the capital.

In addition, they are listed, with their shares traded

on regulated exchanges – which, in our case, is the

London Stock Exchange.

The Company is a closed-ended company with

no day-to-day redemptions impacting the size

of the fund (excluding the annual redemption).

Shareholders are able to invest or exit the Company

through their broker/platform provider.

Running costs are deducted from the total assets

of the Company on a pro-forma basis so the

Adjusted NAV published each day is expressed

after costs. The figures below are the costs paid by

the Company over the year under review and are

expressed as a percentage of the average asset value

of the Company over the year to 30 April 2024 of

£49,077,000 (2023: £69,083,000).

The Investment Manager has agreed that, for so long

as it remains the Company’s investment manager,

it will rebate such part of any management fee

payable to it so as to help the Company maintain

an ongoing charges ratio of 2% or lower. In addition,

the Company also pays transaction charges

that

are levied when shares are bought or sold in the

portfolio. These are dealing commissions paid to

stockbrokers and stamp duty, a Government tax paid

on transactions (which is zero when dealing on the

AIM/Aquis exchanges).

The overall costs of the Company for the period were

2.07% This compares with the Company’s average

NAV total return since issue of 16.2% (after deduction

ofcosts).

A Summary of the Total Costs

Involved in Managing the Trust

1 The basic management fee payable to the AIFM is calculated at the rate of one-twelfth of 0.9% (1% prior to 1 September 2020) of the average market

capitalisation of the Company up to £100m, 0.8% per annum on the average market capitalisation above £100m, on the last business day of each calendar

month. The basic management fee accrues daily and is payable in arrears in respect of each calendar month. For the purpose of calculating the basic fee,

the‘adjusted market capitalisation’ of the Company is deﬁned as the average daily mid-market price for an Ordinary Share and C share (when in issue),

multiplied by the number of relevant shares in issue, excluding those held by the Company in treasury, on the last business day of the relevant month. In

addition to the basic management fee, and when the Redemption Pool is in existence, the AIFM is entitled to receive from the Company a fee calculated at the

rate of 0.9% (1% prior to 1 September 2020) of the NAV of the Redemption Pool on the last business day of the relevant calendar month.

2 The change in service providers, which took effect from 4 March 2024, will mean future expenses will fall in absolute terms.

3 Transactions conducted by the Company also involve some loss of value due to the dealing spread in stock exchange prices. Spreads range from less than 1%

in the most actively traded large cap stocks to more than 10% in the smallest, most infrequently traded stocks. The exact loss of value is difﬁcult to determine

precisely, but is normally less than half of the dealing spread at the time of the transaction. In a large percentage of the transactions, especially in the smallest

stocks, the stock is passed through from sizeable seller to sizeable buyer on a ‘put through’ basis with potentially no loss of value through the spread. During the

year under review, this cost is believed to be very modest in comparison to the Adjusted NAV.

2024

2023

Fund management fees

0.80 0.86

Administration costs, including

Company Secretarial fees

0.46 0.30

Directors/Auditor/Depositary/

Registrar/Custodian and

Stockbroker fees 0.53 0.38

All other direct costs, including

VAT on the fees above, plus

marketing, legal 0.20 0.18

Ongoing charges 1.99 1.72

16 | Miton UK MicroCap Trust plc | Annual Report 2024

2024

2023

Costs paid in

dealing commissions 0.08 0.05

Stamp duty, a Government tax

on transactions  0.01

Overall costs including

transaction charges 2.07 1.78

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Portfolio Information

as at 30 April 2024

Rank Company

Sector &

main activity

Valuation

£000

% of

net assets

1 Yü Group Utilities 3,967 9.2

2 MTI Wireless Edge Telecommunications 1,267 2.9

3 TruFin Financials 1,238 2.9

4 Serabi Gold Basic Materials 1,023 2.3

5 CyanConnode Holdings (including warrants) Telecommunications 889 2.0

6 Zephyr Energy (including warrants) Energy 859 2.0

7 Supreme Consumer Staples 834 1.9

8 Braemar Industrials 774 1.8

9 Concurrent Technologies Technology 743 1.7

10 UP Global Sourcing Holdings Consumer Discretionary 732 1.7

Top 10 investments 12,326 28.4

11 Frontier IP Group Industrials 705 1.6

12 Ingenta Technology 694 1.6

13 Zoo Digital Group Technology 691 1.6

14 STM Group Financials 659 1.5

15 Zinc Media Group Consumer Discretionary 645 1.5

16 Beeks Financial Cloud Technology 645 1.5

17 Amaroq Minerals Basic Materials 645 1.5

18 Andrada Mining Basic Materials 620 1.4

19 Marwyn Value Investors Financials 600 1.4

20 Capital Basic Materials 596 1.4

Top 20 investments 18,826 43.4

21 Savannah Resources Basic Materials 591 1.4

22 Record Financial Group Financials 570 1.3

23 Elemental Altus Royalties Basic Materials 508 1.2

24 Xeros Technology Industrials

507 1.2

25 CT Automotive Group Consumer Discretionary 506 1.2

26 Zotefoams Basic Materials 476 1.1

27 Van Elle Holdings Industrials 476 1.1

28 Mercia Asset Management Financials 467 1.1

29 Enteq Technologies Energy 465 1.1

30 Feedback Health Care 465 1.1

Top 30 investments 23,857 55.2

Balance held in equity instruments (including warrants) 17,435 40.3

Total equity investments 41,292 95.5

Listed Put Option

UKX – June 2024 5,900 Put 2 0.0

Other net current assets 2,003 4.5

Net assets 43,297 100.0

* Source: Reﬁnitiv. Based on historical yields and therefore not representative of future yields. Includes special dividends where known.

18 | Miton UK MicroCap Trust plc | Annual Report 2024

Portfolio exposure by sector (%)

10.2 10.0 4.5 4.0

2.8

1.9

5.9

Actual annual income by sector (%)

£43.30 million

£0.64 million

Net asset by asset allocation (%)

AIM/AQUIS

Exchanges

Main Market

Cash and

cash equivalents

International

Equities

FTSE 100 Option

Basic Materials

Technology

Financial Services

Industrials

Utilities

Energy

Consumer

Discretionary

Telecomms

Cash and cash

equivalents

Health Care

Consumer Staples

Real Estate

Financial Services

Industrials

Telecomms

Basic Materials

Consumer

Discretionary

Technology

Real Estate

Energy

Consumer Staples

Utilities

Health Care

£43.30 million

Source: Reﬁnitiv.

Portfolio as at 30 April 2024

The tables above set out how the portfolio’s capital

was deployed as at 30 April 2024. The data is shown

in terms of the classifications or the stock markets

on which the holdings are listed. UK smaller quoted

companies that are not listed on the Main Market

of the London Stock Exchange are normally quoted

on AIM. The AIM market is set up to meet the

requirements of smaller listed companies providing

them with the ability to raise funds. This also

provides liquidity for the acquisition and disposal

of shares. The Company additionally holds certain

shares on the Aquis Exchange, a regulated exchange.

The cash position provides the Company with £2.1m

of cash resources. This enables the Company to take

advantage of investments at opportune times.

The investment income above comprises the

income from the portfolio as included in the

Income Statement for the year ended 30 April 2024

attributable to the various sectors. The returns

of the Company are from Capital and Revenue.

Investments for the Company’s portfolio are

principally selected on their individual merits. As the

portfolio evolves, the Manager continuously reviews

the portfolio’s overall sector and index balance to

ensure that it remains in line with the underlying

conviction of the Investment Manager. The

Investment Policy is set out on page 81, and details

regarding risk factors and diversification, whilst other

policies are set out each year in the Annual Report.

17.4 15.6 12.5 9.1 6.1

10.2 9.1 4.6 4.3

3.8

1.3

4.832.9 16.2 7.2 5.6

15.6

4.5

1.2

0.0

78.7

Portfolio Information continued

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Annual Report 2024 | Miton UK MicroCap Trust plc | 19

The

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Performance and Risks

Key Performance Indicators

The Board reviews the Company’s performance by reference to a number of key performance indicators

(“KPIs”) and considers that the most relevant KPIs are those that communicate the financial performance and

strength of the Company as a whole. The Board and the Investment Manager monitor the following KPIs:

•

Adjusted NAV performance

Whilst the Trust does not have a formal

benchmark, its returns are routinely compared

with the performance of the peer group and the

Deutsche Numis Smaller Companies 1000 Index

to provide context. Over the year, the Adjusted

NAV total return of the Trust was (12.9)%, which

compares to 9.3% for the peer group and 7.2% for

the Deutsche Numis Smaller Companies 1000

Index. Since the Company’s listing in April 2015,

the Adjusted NAV total return was 16.2%, which

compares to 82.5% for the peer group and 55.3%

for the Deutsche Numis Smaller Companies 1000

Index. The Board believes that a UK investment

strategy that delivers returns that are not

especially closely correlated with the mainstream

UK indices offers diversification benefits to

shareholders.

•

Daily stock market trading volumes of the Trust

Over the year, the average daily volume of

the Company’s shares traded each day was

approximately 94,000 and, since IPO, an average

of approximately 234,000 shares have been traded

daily. This indicator tends to be elevated when

the Trust is outperforming, although it may be

assisted by clearing all the overhanging sellers in

the Trust each year at the time of the redemption.

Generally, new buyers like to know there aren’t

any major sellers that are potentially overhanging,

waiting toexit.

•

The discount/premium of the share price in

relation to the Adjusted NAV

At times, the number of shareholders looking to

transact in the Trust’s shares exceeds the market’s

daily liquidity. Imbalances like this are normally

cleared through stock market transactions over

a few weeks, but on occasion these imbalances

can become persistent leading the Trust’s share

price to diverge from the daily Adjusted NAV.

The Board believes that the existence of the

Trust’s redemption facility assists in keeping

this divergence to a minimum over the long

term. Although during the year under review

the Trust’s share price has traded 9.2% below its

daily Adjusted NAV on average, since launch this

discount has been maintained below 5%. The

Trust has an objective to keep this divergence to a

minimum. Over the year under review, the Trust’s

share price has traded on average 9.48% below its

dailyAdjusted NAV.

•

Ongoing charges

The ongoing charges on the Ordinary Shares

for the year to 30 April 2024 amounted to 1.99%

(30 April 2023: 1.72%) of total assets. Further

details are set out on page 93.

20 | Miton UK MicroCap Trust plc | Annual Report 2024

Performance and Risks continued

Principal Risks and Uncertainties

The Company is exposed to a variety of risks and uncertainties that could cause its asset price or the

income from the investment portfolio to reduce, possibly by a sizeable percentage in the most adverse

circumstances. The principal financial risks and the Company’s policies for managing these risks and the

policy and practice with regard to the portfolio are summarised in note 18 to the financial statements.

The Board, through delegation to the Audit and Management Engagement Committees, undertakes a

robust annual assessment and review of the principal risks facing the Company, together with a review of

any new and emerging risks which may have arisen during the year, including those that would threaten its

business model, future performance, solvency or liquidity. These risks are formalised within the Company’s

risk matrix. Information regarding the Company’s internal control and risk management procedures can be

found in the Corporate Governance Statement on pages 34 to 40.

Listed below is a summary of the principal and emerging risks identified by the Board and actions taken to

mitigate those risks.

Risk Mitigation

Investment and strategy

There can be no guarantee that the investment

objective of the Company will be achieved.

The Company will invest primarily in small

UK quoted or traded companies by market

capitalisation. Smaller companies can be expected,

in comparison to larger companies, to have less

mature businesses, a more restricted depth of

management and a higher risk profile.

These companies are normally traded less

frequently on the stock exchanges and, when

aggregated with holdings in other client funds

of the Investment Manager, the combined funds

may have a significant percentage ownership of

investee companies.

Many businesses are facing additional financial

challenges due to demand fluctuations, and/ or

additional cost of supply currently, due to the effects

of the Ukrainian war.

The Investment Manager has long experience of

managing portfolios of this nature, including dealing

in smaller capitalisation companies, and deploying

an approach that is designed to maximise the

chances of the investment objective being achieved

over longer-term time horizons. The Company is

reliant on its Investment Manager’s investment

process. The Board reviews and discusses the

investment approach at each Board meeting, and

if it isn’t satisfied, in extremis, it can appoint another

Investment Manager.

The Manager looks to mitigate the higher risk

profile of individual quoted smaller companies by

ensuring that the Company holds a well-diversified

portfolio, both by number of companies and areas of

operation. The Company’s diversified portfolio holds

some stocks where prospects have improved that

offset some others where they have deteriorated.

The Company is structured as a closed-ended fund,

which means that it is not subject to daily inflows

andoutflows of capital.

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Annual Report 2024 | Miton UK MicroCap Trust plc | 21

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Risk Mitigation

Reliance on third parties

The Company has no employees and is reliant on

the performance of third-party service providers.

Failure by the Investment Manager or any other

third-party service provider to perform in accordance

with the terms of their appointment could have

a material detrimental impact on the operation

of the Company. This could include failure of a

counterparty on whom the Company is reliant.

The Board monitors and receives reports on the

performance of its key service providers. In relation

to the risk of counterparty failure, the Board reviews

the controls report of the Depositary.

The Board may, in any event, terminate all key

contracts on normal commercial terms.

Loss of key personnel/fund managers

The Company depends on the diligence, skill,

judgement and business contacts of the Investment

Manager’s investment professionals and its future

success could depend on the continued service of

these individuals, particularly GervaisWilliams and

Martin Turner.

The Company may decide to terminate the

Management Agreement should both Gervais

Williams and Martin Turner cease to be employees of

the Management group and if they are not replaced

by a person/s who the Company considers to be of

equal or satisfactory standing within three months

of one or both of their departures.

Share price volatility and liquidity/marketability risk

The market price of the Ordinary Shares, as with

shares in all investment trusts, may fluctuate

independently of their underlying Adjusted NAV

and may trade at a discount or premium at different

times, depending on factors such as supply and

demand for the Ordinary Shares, market conditions

and general investor sentiment.

The Company may become too small to be attractive

to a wide audience, with lesser stock market liquidity

and a wider share price discount.

The consequences of the UK’s vote to leave the

EU continues to cause uncertainties for financial

markets, together with the Russia-Ukraine war and

the ongoing conflict in the Middle East.

The Company has in place an annual redemption

facility whereby shareholders can voluntarily tender

their shares. The Board monitors the relationship

between the share price and the Adjusted NAV. The

Company has powers to repurchase shares should

there be an imbalance in the supply and demand

leading to a persistent and excessive discount. The

Investment Manager and, on occasion, the Directors

maintain dialogue with shareholders through

regular face-to-face meetings.

22 | Miton UK MicroCap Trust plc | Annual Report 2024

Performance and Risks continued

Risk Mitigation

Costs of operation

As stated, the Company relies on external service

providers. Many of these are paid on a basis where

their fees are related to the size of the Company

(an“ad valorem” basis). Others are for fixed monetary

amounts. Therefore, if the Company were to

shrink, through redemptions, buybacks or asset

performance, the cost per share of running the

Company would increase. This could make it harder

to achieve the investment objective.

The Board monitors the costs of all service

providers. The Board is also committed to the

controlled growth of the Company which would

spread the fixed costs over a larger asset base. In

the event that the Company was to decrease in size

from its current level, the Board has capped the

total costs at no more than 2% of the aggregate

market capitalisation. The ongoing charges for the

year to 30 April 2024 amounted to 1.99% (30 April

2023: 1.72%).

Regulatory risk/change in tax status

The Company is subject to laws and regulations

enacted by national and local governments. Any

change in the law and regulation affecting the

Company may have a material adverse effect on the

ability of the Company to carry on its business and

successfully pursue its investment policy.

The Board receives regular updates from its

Secretary, Broker, industry representatives and

its Investment Manager on significant regulatory

changes that may impact the Company. The

Company’s ability to determine the shape of

regulatory or tax changes is limited and therefore

the Board aims to ensure that it is well informed and

prepared to respond to changes as they emerge.

Cyber Risk/IT Security

Errors, fraud or control failures by the Company’s key

service providers or loss of data through increasing

cyber threats or business continuity failure could

damage the Company’s reputation or investors’

interests or result in losses.

The Board receives regular control reports and cyber/

IT policies from all material service providers to

ensure that controls are in place including business

continuity and disaster recoveryarrangements.

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Annual Report 2024 | Miton UK MicroCap Trust plc | 23

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Risk Mitigation

The Company may be subject to legal action by others

The investment portfolio comprises the principal

assets of the Company, and is valued on their market

bid price along with its cash balances. One way to

realise a return for investors is to accept a takeover

offer, often at a premium to the market price. When

these transactions occur, the Company may be in

receipt of cash proceeds, that are then reinvested

in other equities. When the acquirers are US

companies, the Company is at risk that an acquirer

subsequently discovers that the commercial value of

the business acquired is not as anticipated, and may

try to reclaim some or all of the proceeds paid for the

acquisition from the vendors – which in our case is

the Company.

The Company would normally expect acquirers

to carry out their own due diligence on the

assets being acquired, and if there is subsequent

disappointment then to seek redress from

theiradvisers.

Major market event, climate change or geo-political risk

The Company is exposed to stock market volatility or

illiquidity as a result of a major market shock due to

a national or global crisis, geo-political developments

or the effects of climate change.

The impact of such risks, associated with the

portfolio or the Company itself, could result in

disruption to the operations of the Company

andlosses.

External risks over which the Company has no

control are always a risk. The Board is cognisant

of its reliance on the operations of the third-party

suppliers, including the Manager, to mitigate

risks arising from market events, climate change

and geo-political developments, such as a global

pandemic, Russia’s invasion of Ukraine and the

ongoing conflict in the Middle East.

The climate risk exposure is monitored by the

Manager and is not currently considered to be

financially material to the valuation of the Trust.

More information is available in the TCFD product

report which was published on 27 June 2024.

24 | Miton UK MicroCap Trust plc | Annual Report 2024

Share Capital

Share Issues

At the Annual General Meeting held on 26 September

2023, the Directors were granted the authority to allot

up to 9,464,000 Ordinary Shares (up to an aggregate

nominal amount of £9,464) on a non pre-emptive

basis. The Company put a new blocklisting facility into

place towards the end of the financial year ended 30

April 2020 and, during the year, issued no Ordinary

Shares under this blocklisting facility.

The Directors’ current authority to allot Ordinary

Shares is due to expire at the Company’s Annual

General Meeting to be held on 24 September

2024. Proposals for the renewal of the authority are

included within the Notice of AGM on page 85. Any

Ordinary Shares allotted under this authority will not

be issued at less than NAV.

Share Redemptions

Valid redemption requests were received under the

Company’s redemption facility for the 2November

2023 Redemption Point in relation to 17,714,958

Ordinary Shares, representing 18.7% of the

Company’s issued share capital.

Purchase of Own Shares

At the Annual General Meeting of the Company held

on 26 September 2023, the Directors were granted

the authority to buy back up to 14,186,320 Ordinary

Shares. No Ordinary Shares have been bought back

under this authority during the year under report.

The authority will expire at the forthcoming Annual

General Meeting, when a resolution for its renewal

will be proposed.

Treasury Shares

Shares bought back by the Company may, at the

Board’s discretion, be held in treasury, from where

they could be re-issued at a premium to Adjusted

NAV quickly and cost effectively. This provides

the Company with additional flexibility in the

management of its capital base. No shares were

purchased for, or held in, treasury during the year or

since the year end.

Issued Share Capital

As at the year end, there were 76,923,603 Ordinary

Shares and 50,000 Management shares in issue.

Further details of the Company’s share capital are set

out in note 4 to the financial statements on page66.

The rights attached to each share class are set out on

page 81.

There are no restrictions concerning the transfer

of securities in the Company or on voting rights;

no special rights with regard to control attached

to securities; no agreements between holders of

securities regarding their transfer known to the

Company; and no agreements which the Company

is party to that might affect its control following a

successful takeover bid.

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Annual Report 2024 | Miton UK MicroCap Trust plc | 25

S.172(1) Statement

Background

Directors have a duty (under section 172 of the

Companies Act 2006) to promote the success of

a company for the benefit of shareholders as a

whole. In doing so, a company must have regard

to other broader matters including the likely long

term consequences of any decision, and the need to

foster a company’s relationships with its employees,

suppliers, customers and others and to have

regard to their interests, the impact of a company

on the community and the environment, and the

desirability of maintaining a reputation for high

standards of business conduct.

Stakeholders

The Board seeks to understand the needs and

priorities of the Company’s stakeholders and these

are taken into account during all its discussions and

as part of its decision-making. In considering the

Company’s stakeholders, the Board has concluded

that, as the Company is an externally managed

investment trust and does not have any employees

or customers in the traditional sense, its key

stakeholders comprise its shareholders, suppliers

(comprising mainly its Investment Manager, third

party service providers and advisers), but they also

take account of the Company’s responsibilities to

regulators and to the environment and the wider

community. The section below discusses the actions

taken by the Company to ensure that the interests of

stakeholders are taken into account.

Shareholders

The Board is committed to maintaining open

channels of communication and to engage with

shareholders in a manner which they find most

meaningful, in order to gain an understanding of the

views of shareholders. These include:

Annual General Meeting – The Company

encourages the attendance of shareholders at

the Annual General Meeting. Shareholders have

the opportunity to meet the Directors and the

Investment Manager and to address questions to

them directly. There is typically a presentation on

the Company’s performance and on the future

outlook by the Investment Manager.

Publications – The Annual Report and Half-Year

results are made available on the Company’s

website and are circulated to those shareholders

requesting hard copies. These reports provide

shareholders with a clear understanding of the

Company’s portfolio and financial position. This

information is supplemented by a monthly

factsheet, which is available on the website.

Feedback and/or questions which the Company

receives from shareholders help the Company

evolve its reporting, aiming to render the reports

and updates transparent and understandable.

Shareholder concerns – In the event that

shareholders wish to raise issues or concerns with

the Directors, they are welcome to do so at any time

by writing to the Chairman at the registered office

or by emailing at mitonukmicrocap@ntrs.com. The

Senior Independent Director and other members

of the Board are also available to shareholders if

they have concerns that have not been addressed

through the normal channels.

Investor relations updates – At every Board

meeting, the Directors receive updates from the

Broker, Peel Hunt LLP, and from the Company

Secretary on the share trading activity, share price

performance, the Company’s share register and

investor relations.

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26 | Miton UK MicroCap Trust plc | Annual Report 2024

S.172(1) Statement continued

Other stakeholders

Investment Manager

Maintaining a close and constructive working

relationship with the Investment Manager (Premier

Miton) is crucial to the Board. The Investment

Manager’s performance is critical for the Company to

successfully achieve consistent, long-term returns in

line with its investment objective. The Board meets

with the Investment Manager on a regular basis,

both within and outside formal Board meetings, and

receives and discusses monthly reports and updates

with the Investment Manager when appropriate.

Further details on the relationship with the

Investment Manager can be found on page 35.

Suppliers

The Company relies on a diverse range of reputable

advisors for support in meeting its obligations.

The Board maintains regular contact with its key

external providers, namely the Administrator, the

Company Secretary, the Registrar, the Custodian

and the Broker, and receives regular reporting from

them, both through the Board and committee

meetings, as well as outside the regular meeting

cycle. Their advice, as well as their needs and views,

are regularly taken into account. The Management

Engagement Committee formally assesses the

performance of third party suppliers, their fees and

continuing appointment on an annual basis to

ensure that the key service providers continue to

function at an acceptable level and are appropriately

remunerated to deliver the expected level of service.

The Management Engagement Committee also

receives reports on the financial reporting control

environments in place at each service provider.

Regulators

The Company can only operate with the approval

of its regulators, who have a legitimate interest

in how the Company operates in the market and

treats its investors and shareholders. The Company

regularly considers the control environment in

place to ensure that it meets various regulatory and

statutory obligations.

Environment and Community

In light of the out-sourced nature of the Company’s

operations, the Company has very little direct impact

on the community or the environment. However, the

Investment Manager recognises that it can influence

an investee company’s approach to Environmental,

Social and Governance (“ESG”) matters and discusses

ESG matters with investee companies on a regular

basis. Further information about the Company’s

approach to environmental, human rights, social and

community issues are set out on page 29.

The above mechanisms for engaging with

stakeholders are kept under review by the Directors

and are discussed on a regular basis at Board

meetings to ensure that they remain effective.

Should shareholders or other stakeholders of the

Company wish to contact the Chairman, they can

do so by contacting the registered office of the

Company or by sending an email for the attention of

the Chairman at mitonukmicrocap@ntrs.com.

Decision-making

The Board considers the impact that any material

decision will have on all relevant stakeholders to

ensure that it is making a decision that promotes

the long-term success of the Company. By way of

illustration, decisions taken during the course of

the financial year related to the recommendation

of payment of a final dividend, the renewal of the

annual redemption facility and, after review, a

change in key service providers.

Annual Report 2024 | Miton UK MicroCap Trust plc | 27

Culture

The Company’s defined purpose is relatively

simple: it is to deliver our investment objective. The

culture of the Board promotes a desire for strong

governance and long-term investment, mindful of

the interests of all stakeholders. The Board believes

that, as an investment company with no employees,

this is best achieved by working in partnership with

its appointed Investment Manager.

The Directors agree that establishing and

maintaining a healthy corporate culture among the

Board and in its interaction with the Investment

Manager, shareholders and other stakeholders

will support the delivery of its purpose, values and

strategy. The Board seeks to promote a culture of

openness, debate and integrity through on-going

dialogue and engagement with its service providers,

principally the Investment Manager.

The Board strives to ensure that its culture is in

line with the Company’s purpose, values and

strategy. The Company has a number of policies

and procedures in place to assist with maintaining

a culture of good governance including those

relating to Diversity, Directors’ conflicts of interest

and Directors’ dealings in the Company’s shares. The

Board assesses and monitors compliance with these

policies as well as the general culture of the Board

through Board meetings and in particular during

the annual evaluation process which is undertaken

by each Director (for more information see the

performance evaluation section on page 37).

The Board seeks to appoint the appropriate service

providers and evaluates their remit, performance

and cost effectiveness on a regular basis as described

on page 26. The Board considers the culture of the

Investment Manager and other service providers,

including their policies, practices and behaviour,

through regular reporting from these stakeholders

and in particular during the annual review of

performance and the continuing appointment of all

service providers.

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28 | Miton UK MicroCap Trust plc | Annual Report 2024

Management, Social, Environmental

andDiversity Matters

continued

Management Arrangements

The Company’s investment manager is Premier

Portfolio Managers Limited (the “Investment

Manager”). The Investment Manager is responsible

for the management of the Company’s portfolio in

accordance with the Company’s investment policy

and the terms of the Management Agreement

dated 8 April 2015 and restated 20 October 2020.

The Board has appointed Premier Portfolio

Managers Limited as the alternative investment fund

manager (“AIFM”) of the Company.

Under the terms of the Management Agreement,

the Investment Manager is entitled to a

management fee together with reimbursement

of reasonable expenses incurred by it in the

performance of its duties. The management fee is

payable monthly in arrears and is at the rate of 0.9%

per annum where the market capitalisation is at or

below £100,000,000 and 0.8% thereafter, calculated

in respect of each calendar month, of the market

capitalisation at the relevant calculation date. In

addition to the basic management fee, and for so

long as a Redemption Pool (see page 80 for details)

is in existence, the Investment Manager is entitled

to receive from the Company a fee calculated at the

rate of 0.9% per annum of the net asset value of the

Redemption Pool on the last Business Day of the

relevant calendar month.

The Investment Manager has agreed that, for so long

as it remains the Company’s investment manager,

it will rebate such part of any management fee

payable to it so as to help the Company maintain an

ongoing charges ratio of 2% or lower.

In accordance with the Directors’ policy on the

allocation of expenses between income and capital,

in each financial year 75% of the management fee

payable is expected to be charged to capital and the

remaining 25% to income.

The Management Agreement is terminable by either

the Investment Manager or the Company giving to

the other not less than 12 months’ written notice.

The Management Agreement may be terminated

earlier by the Company with immediate effect on the

occurrence of certain events, including insolvency or

in the event of a material breach by the Investment

Manager of the Management Agreement which

is not remedied within thirty days of the receipt

of notice. The Company has given certain market

standard indemnities in favour of the Investment

Manager in respect of the Investment Manager’s

potential losses in carrying on its responsibilities

under the Management Agreement.

The Board appointed Northern Trust Investor

Services Limited as Depositary. The annual fee

(based on Adjusted NAV) for depositary services due

to Northern Trust Investor Services Limited is 0.01%

up to £500m and 0.008% above £500m, subject to a

minimum fee of £7,500.

Administrative Services are delegated by Premier

Portfolio Managers Limited (PPM) to Northern Trust

under an agreement dated 22 November 2023,

which may be terminated by either party on at least

six months’ prior written notice.

Annual Report 2024 | Miton UK MicroCap Trust plc | 29

Continuing Appointment of the InvestmentManager

The Board, through the Management Engagement

Committee, keeps the performance of the

Investment Manager under continual review and the

Management Engagement Committee conducts

an annual appraisal of the Investment Manager’s

performance, and makes a recommendation to the

Board about the continuing appointment of the

Investment Manager. It is the opinion of the Board

that the continuing appointment of the Investment

Manager is in the interests of shareholders as a

whole. The Board believes that the Investment

Manager has executed the investment strategy in

line with the Prospectus. The Directors also believe

that by paying the management fee calculated on a

market capitalisation basis, rather than a percentage

of assets basis, the interests of the Investment

Manager are more closely aligned with those

ofshareholders.

Environmental, Human Rights, Employee, Social

and Community Issues

The Company does not have any employees and the

Board consists entirely of non-executive Directors.

The day-to-day management of the business

is delegated to the Investment Manager. As an

investment trust. As such, the Company has no

environmental, human rights, social or community

policies. However, in carrying out its investment

activities and in relationships with suppliers, the

Company aims to conduct itself responsibly and

ethically. The Company has a zero tolerance policy

towards bribery and corruption and as such is

committed to carrying out its business fairly,

honestly and openly. Further information about the

Company’s relationships with its stakeholders is set

out in the s.172 Statement on pages 25 to 27.

Diversity

The Board of Directors of the Company comprises

two female and two male Directors. The Company’s

Diversity Policy acknowledges the benefits of all

aspects of increased diversity, including gender

and ethnic diversity, as well as diversity of thought

and perspective. The Board remains committed

to ensuring that the Company’s Directors bring a

wide range of skills, knowledge, experience and

backgrounds. The Board will always appoint the best

person for the job and will not discriminate on any

grounds including gender, race, ethnicity, religion,

sexual orientation, age or physical ability.

Approval

The Strategic Report has been approved by the

Board of Directors.

On behalf of the Board

Ashe Windham

Chairman

11 July 2024

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30 | Miton UK MicroCap Trust plc | Annual Report 2024

Directors

All the Directors are non-executive and are independent of the Investment Manager.

Ashe Windham, CVO – Chairman

Elected 29 September 2016

Following 11 years’ service in the British Army, Ashe joined Barclays de Zoete

Wedd (“BZW”) in 1987 as an institutional equities salesman and was appointed

a Director of BZW’s Equities Division in 1991. He joined Credit Suisse First Boston

in 1997 when they acquired BZW’s equities business. In 2004, he joined Man

Investments as Head of Internal Communications and in 2007 became Man

Group’s Global Head of Internal Communications. In June 2009 he resigned

from Man Group plc to set up a private family office, which he continues

to run. Ashe is the chairman of the Cancer & Pisces Trust and of The Kyle of

Sutherland Fisheries Trust, whilst he is also a non-executive director of EFG Asset

Management (UK) Limited and Chair of the Remuneration Committee.

Peter Dicks – Chairman of the

Audit Committee

Elected 29 September 2016

Peter was a founder director of

Abingworth plc in 1973, a venture

capital investment company,

mainly investing in the USA but

also in the UK, where he worked

from 1973 to 1991. Since then he

has been a non-executive director

or chairman of a number of

companies. He is on the Board

of Mercia Fund 1 General Partner

Limited and Averon Park Limited

and currently the chairman of

SVM Emerging Fund and Unicorn

Asset Management Limited.

Louise Bonham

Elected 26 September 2023

Louise has considerable

experience in the property,

banking and professional services

industries. Louise is CEO of MAPP,

a property services company and

has held a wide range of senior

appointments including at CBRE

and Cushman & Wakefield where

she was a member of the UK &

Ireland Executive Committee.

Previously, Louise held positions

at Deloitte and as an equities

analyst at Deutsche Bank. Louise

is a Chartered Accountant

and a Fellow of the Institute

of Chartered Accountants in

England and Wales.

Davina Walter

Elected 22 September 2021

Davina Walter is an experienced

investment professional. She

started her career at Cazenove &

Co where she spent more than

11years, ending up as the Head of

US equity research.

She then spent over 16 years as

an investment manager of both

large and small cap US equities,

most recently as a Managing

Director at Deutsche Asset

Management. She has been

actively involved with investment

trusts since 1985 and is Chairman

of abrdn Diversified Income and

Growth plc.

Annual Report 2024 | Miton UK MicroCap Trust plc | 31

Report of the Directors

The Directors present their report and the financial statements for the year ended 30 April 2024.

Directors

The Directors in office at the date of this Report and

the dates of their election are shown on page 30. In

accordance with the policy adopted by the Board, all

the Directors will retire and stand for re-election at

the Company’s forthcoming Annual General Meeting

(“AGM”).

Following consideration of the results of the

performance evaluation, the Board was assured that

the performance of all Directors continues to be

effective, that they bring extensive knowledge and

commercial experience to the Board, demonstrate a

range of valuable business, financial and investment

trust skills, that they continue to be effective and

their contribution supports the long-term success

of the Company and that they remain wholly

independent. The Board therefore recommends

that shareholders vote in favour of each Director’s

proposed election.

None of the Directors or any persons connected

with them had a material interest in the transactions

and arrangements of, or the agreement with, the

Investment Manager during the year.

Substantial Shareholdings

So far as is known to the Company by virtue of

notifications made to it pursuant to the Disclosure

Guidance and Transparency Rules, the following

persons held notifiable interests in the Company’s

voting rights as at 30 April 2024:

The Company has been informed of the following

notifiable interests between 30 April 2024 and the

date of this report.

It should be noted that these holdings may have

changed since notified to the Company and may

not therefore be wholly accurate statements of

actual holdings. However, notification of any change

is not required until the next applicable threshold

iscrossed.

Dividends

The Directors have recommended the payment of

a final dividend in respect of the year of 0.09 pence

per Ordinary Share, payable on 25 October 2024

to shareholders who appear on the register on

27September 2024. The ex-dividend date will be

26September 2024.

Future Developments

A review of the year and the outlook for the next year

are set out in the Investment Manager’s Report on

pages 10 to 14

Financial Risk Management

The principal financial risks and the Company’s

policies for managing these risks are set out in note

18 to the financial statements.

Corporate Governance

The Corporate Governance Statement on pages

34 to 40 forms part of the Report of the Directors.

It includes details of the qualifying third party

indemnity provisions and Directors’ and Officers’

liability insurance on page 36.

Number of

Ordinary

% of

voting rights

Rathbone Investment

Management Limited 15,219,330 19.79

Investec Wealth &

Investment Limited 9, 380,474 9.91

City of Bradford - Pension Fund 6,118,600 7.95

Wesleyan Assurance Society 4,448,200 5.78

CG Asset Management Ltd 3,878,927 5.04

Brewin Dolphin Limited 2,766,380 3.60

Charles Stanley Group plc 2,138,049 2.78

Number of

Ordinary

% of

voting rights

Rathbone Investment

Management Limited 13,841,714 17.99

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

32 | Miton UK MicroCap Trust plc | Annual Report 2024

Report of the Directors continued

Post Balance Sheet Events

Disclosures relating to post balance sheet events can

be found in the notes on page 79.

Going Concern

The Directors consider that it is appropriate to adopt

the going concern basis. Cashflow projections have

been reviewed and show that the Company has

sufficient funds to meet its contracted expenditure.

On the basis of the review and, as the majority of net

assets are securities which are traded on recognised

stock exchanges, after making enquiries, and bearing

in mind the nature of the Company’s business and

assets, the Directors consider that the Company

has adequate resources to continue in operational

existence for the foreseeable future. In arriving at this

conclusion, the Directors have carried out a robust

assessment of the principal and emerging risks set

out on pages 20 to 23 of this report, including the risks

arising from market volatility, the Russia-Ukraine war

and the ongoing conflict in the Middle East and their

impact on the liquidity of the portfolio and resultant

cashflow, along with the Company’s ability to meet

obligations as they fall due, its ability to raise finance

in the short and longer term and future prospects

and results. The Directors will assess the impact of

the Company’s annual redemption facility on its cash

reserves. Accordingly, the Directors have a reasonable

expectation that the Company has adequate

resources to continue in operational existence for a

period of at least 12 months from the date that these

financial statements were approved.

Viability Statement

In accordance with the AIC Code of Corporate

Governance, the Board has considered the prospects

for the Company.

The period assessed is the three years to April

2027. The Company is intended to be a long-term

investment vehicle. It was launched in 2015, and

due to the limitations and uncertainties inherent

in predicting market and political conditions,

the Directors have determined that three years

is the appropriate period over which to make

thisassessment.

As part of its assessment of the viability of the

Company, the Board has considered the principal

risks and uncertainties and the impact on the

Company’s portfolio of a significant fall in UK markets.

To provide this assessment, the Board has considered

the Company’s financial position and its ability to

liquidate its portfolio to meet its expenses or other

liabilities as they fall due:

•

the Company invests largely in companies listed

and traded on stock exchanges. These are actively

traded and, whilst perhaps less liquid than larger

quoted companies, the portfolio is well diversified

by both number of holdings and industry sector;

•

the expenses of the Company are predictable

and modest in comparison with the assets in the

portfolio. There are no commitments that would

change that position;

•

the Company has no employees; and

•

the Company has an annual redemption facility

whereby shareholders may request that their

shares are redeemed at NAV. The Board has

considered the possibility that shareholders

holding a significant percentage of the

Company’s shares request redemption. Firstly,

the Board has flexibility over the method and

date of redemption so can avoid disruption to the

overall operation of the Company in this situation.

Secondly, the Company has an arrangement

with the Investment Manager to rebate fees

should total costs exceed 2% of aggregate

market capitalisation, such that were there to be

significant redemption, or a significant fall in the

value of the portfolio, the expenses of operation

would be manageable. In addition, some of the

expenses vary in line with the size of the Company.

Annual Report 2024 | Miton UK MicroCap Trust plc | 33

In addition to considering the principal risks on

pages 20 to 23 and the financial position of the

Company as described above, the Board has also

considered the following further factors:

•

the continuing relevance of the Company’s

investment objective in the current environment

and the continued satisfactory performance of

theCompany;

•

the level of demand for the Company’s shares and

that since launch the Company has been able to

issue further shares;

•

the gearing policy of the Company; and

•

that regulation will not increase to such an extent

that the costs of running the Company become

uneconomic.

Accordingly, the Directors have formed the

reasonable expectation that the Company will be

able to continue in operation and meet its liabilities

as they fall due over the next three years, from the

balance sheet date.

Greenhouse Gas Emissions and Task Force on

Climate-related Financial Disclosures (TCFD)

The Company has no greenhouse gas emissions

to report from its operations, nor does it have

responsibility for any other emissions producing

sources under the Companies Act 2006 (Strategic

Report and Directors’ Report) Regulations 2013,

including those within its underlying investment

portfolio. There is no requirement for disclosures

under The Companies (Directors’ Report) and

Limited Liability Partnerships (Energy and Carbon

Report) Regulations 2018, implementing the UK

government’s policy on Streamlined Energy and

Carbon Reporting. Under Listing Rule 15.4.29(R), the

Company, as a closed-ended investment fund, is

currently exempt from complying with the TCFD.

However, as a regulated entity, PPM produces firm

and product level TCFD reports, including for this

Trust, which are published to its website and can be

found at https://www.mitonukmicrocaptrust.com/

documents/

Requirements of the Listing Rules

Listing Rule 9.8.4 requires the Company to include

specified information in a single identifiable section

of the Annual Report or a cross reference table

indicating where the information is set out. There

are no disclosures required in relation to Listing Rule

9.8.4.

Audit Information

Each of the Directors who held office at the date

of approval of the Report of the Directors confirms

that, so far as he/she is aware, there is no relevant

audit information of which the Company’s Auditor

is unaware; and that he/she has taken all the steps

that he/she ought to have taken as a Director to

make himself/herself aware of any relevant audit

information and to establish that the Company’s

Auditor is aware of that information.

Auditor

The Company’s auditor is BDO LLP. BDO LLP

has confirmed its willingness to continue to act

as the Company’s Auditor and resolutions for its

re-appointment and for the Audit Committee to

determine its remuneration will be proposed at the

forthcoming Annual General Meeting.

Annual General Meeting

The Company’s Annual General Meeting (AGM)

will be held on 24 September 2024 and the formal

Notice of the AGM can be found on page 85.

Assessment and Approval

The Board is of the opinion that this Annual

Report, 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.

The Report of the Directors has been approved by

the Board.

By order of the Board.

Northern Trust Secretarial Services (UK) Limited

Company Secretary

11 July 2024

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

34 | Miton UK MicroCap Trust plc | Annual Report 2024

Statement of Compliance

The Company is committed to maintaining high

standards of corporate governance. The Board of

the Company has considered the principles and

recommendations of the AIC Code of Corporate

Governance for Investment Companies (“AIC Code”)

by reference to the AIC Corporate Governance Guide

for Investment Companies (“AIC Guide”), both as

published in February 2019. The AIC Code, as explained

by the AIC Guide, addresses all the principles set

out in the UK Corporate Governance Code (“UK

Code”), as well as setting out additional principles

and recommendations on issues that are of specific

relevance to the Company as an investment company.

The Financial Reporting Council (“FRC”), the UK’s

independent regulator for corporate reporting

and governance responsible for the UK Code, has

endorsed the AIC Code and the AIC Guide. The terms

of the FRC’s endorsement mean that AIC members

who report against the AIC Code and the AIC Guide

meet fully their obligations under the UK Code and

the related disclosure requirements contained in the

Listing Rules.

In January 2024, the FRC published a revised

version of the UK Corporate Governance Code and

associated Corporate Governance Code Guidance.

The scope of the changes in the revised version has

been significantly scaled back from the proposals on

which the FRC originally consulted in 2023. The most

significant changes in this version of the Corporate

Governance Code are to the reporting requirements

in relation to internal controls in section 4, though

changes are being made throughout, including in

section 1 on outcomes-based reporting; section 3 on

diversity, inclusion and equality of opportunity; and

to the provisions on remuneration in section 5. The

revised Corporate Governance Code will apply to

financial years beginning on or after 1 January 2025.

However, companies will have an extra year to comply

with the new disclosure requirements in relation to

internal controls, with the revised Provision 29 applying

to financial years beginning on or after 1 January 2026.

The Board will review the changes to the Corporate

Governance Code and any corresponding changes

to the AIC Code (which have not yet been published)

during 2024 with a view to ensuring that it can report

on its compliance with effect from 1 January 2025 or

explain any areas of non-compliance.

The Company complies with the recommendations

of the AIC Code and the relevant provisions of the UK

Code, except as set out below.

The UK Code includes provisions relating to: the

role of the chief executive; executive directors’

remuneration; and the need for an internal audit

function. For the reasons set out in the AIC Guide

and as explained in the UK Code, the Board

considers these provisions are not relevant to

the position of the Company, being an externally

managed investment company. The Company does

not therefore comply with these provisions and has

not reported further in respect of them.

A copy of the AIC Code and the AIC Guide can be

obtained via the AIC website, www.theaic.co.uk.

A copy of the UK Code can be obtained at www.frc.

org.uk

The Board of Directors

The Board consists entirely of non-executive

Directors, who are independent of the Investment

Manager. The Company has no employees. No one

individual has unfettered powers of decisions made

by the Board.

The Board is accountable to shareholders for the

direction and control of all aspects of the Company’s

affairs, notwithstanding any delegation of

responsibilities to third parties. A detailed description

of the role of the Board and its relationship with the

Investment Manager are set out further below.

The names and responsibilities of the Directors,

together with their biographies and details of their

significant commitments, are set out on page 30.

The Directors possess a wide range of business and

financial expertise relevant to the leadership of the

Company, including the ability and willingness to

provide robust and objective challenge to the views

and assumptions of the Investment Manager and

other Directors. All of the Directors consider that

Corporate Governance Statement

This Corporate Governance Statement forms part of the Report of the Directors.

Annual Report 2024 | Miton UK MicroCap Trust plc | 35

they have sufficient time to devote to the Company’s

affairs and that they carry out their duties effectively.

No Director has a service contract with the Company,

nor are any such contracts proposed, each Director

having been appointed pursuant to a letter of

appointment entered into with the Company.

The Directors have chosen to follow the practice

of annual re-election by shareholders at the AGM.

The Directors’ appointments can be terminated

in accordance with the Articles and without

compensation. The Directors’ letters of appointment

are available for inspection at the Company’s

registered office and will be available at the Annual

General Meeting.

The appointment of any new Director will be made

on the basis of assessing the candidate’s merits,

measuring his or her skills and experience against

the criteria identified by the Board as being desirable

to complement the composition and qualification of

the Board. In accordance with the Board’s Diversity

Policy, the Board will consider all elements of

diversity when evaluating the skills, knowledge and

experience necessary to fill any Board vacancy. The

Board has established the following measurable

objectives for achieving diversity on the Board:

•

all Board appointments will be made on merit, in

the context of the skills, knowledge and experience

that are needed for the Board to be effective;

•

long lists of potential non-executive directors

should include diverse candidates of appropriate

merit; and

•

only executive search firms who have signed up to

the voluntary Code of Conduct on gender diversity

and best practice will be engaged.

The policy is reviewed on an annual basis.

The Board, or the Investment Manager upon

request of the Board, shall offer induction training

to new Directors about the Company, its key service

providers, the Director’s duties and obligations and

other matters as may be relevant from time to time.

Board Responsibilities and Relationship with the

Investment Manager

The main roles of the Board are to create value for

shareholders, provide leadership to the Company

and approve the Company’s strategic objectives.

Specific responsibilities in relation to investments

and the Investment Manager include:

Determining the Company’s investment policy

and strategy, promoting the long-term success of

the Company, generating value for shareholders

and contributing to wider society; determining the

Company’s gearing policy; monitoring the controls

of the Investment Manager, and reviewing the

investment activity, performance and contractual

arrangements with the Investment Manager. The

Board is also responsible for maintaining proper

internal controls and monitoring shareholders’

opinions and engaging with them effectively. The

Board has adopted a schedule of matters reserved

for decision by the Board reflecting the above

responsibilities and reviews this scheduleregularly.

The Company’s day-to-day functions have been

sub-contracted to a number of service providers,

each engaged under a separate legal agreement.

The management of the Company’s assets has been

delegated to the Investment Manager, Premier

Fund Managers Limited. The Investment Manager

has discretion to manage the Company’s assets in

accordance with the Company’s investment policy,

subject to the overall control and supervision of

theDirectors.

Premier Portfolio Managers Limited is appointed

as the Company’s AIFM for the purposes of the

Alternative Investment Fund Manager Directive

(“AIFMD”).

Premier Portfolio Managers Limited is appointed as

fund administrator. Fund administration services

have been delegated by Premier Portfolio Managers

Limited to Northern Trust Global Services SE.

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

36 | Miton UK MicroCap Trust plc | Annual Report 2024

Corporate Governance Statement continued

Chairman and Senior Independent Director

The Chairman, Ashe Windham, is responsible

for leadership of the Board and ensuring its

effectiveness. The Chairman sets the Board’s agenda,

ensuring a particular focus on the overall strategy

of the Company, and allows adequate time for

discussion of all agenda items. Ashe Windham was

considered to be independent on appointment

and is deemed by his fellow Board members (all

who are independent themselves) to continue

to be independent and to have no conflicting

relationships, in accordance with the criteria set out

in the AIC Code.

Davina Walter, was appointed as the Senior

Independent Director of the Company effective

1May 2024, replacing Peter Dicks. Davina provides

a channel for any shareholder concerns regarding

the Chairman and takes the lead in the annual

evaluation of the Chairman by the independent

Directors. The full responsibility of the Chairman and

Senior Independent Director as agreed by the Board

is set out on the Company’s website.

Board Operation

The Board holds regular Board meetings at least four

times a year, with additional meetings arranged as

necessary. The table below sets out the attendance

record of individual Directors at the scheduled Board

and Committee meetings held during the year

ended 30 April 2024.

This table provides details of scheduled meetings

held in the financial year and the attendance at

each meeting of each Director. From time to time,

the Board is required to hold meetings outside of

its planned schedule to consider topics that require

immediate attention or to approve ad-hoc matters

and transactions. There were additional ad-hoc Board

meetings held during the financial year related to

approval of the half year report andaccounts.

At each scheduled Board meeting, the Chairman

follows a formal agenda, circulated to the Directors

in advance by the Secretary. The Secretary and

Investment Manager regularly provide the Board

with relevant financial information, briefing notes

and papers in relation to changes in the Company’s

economic and financial environment, statutory

and regulatory changes and corporate governance

best practice. At each Board meeting, one or more

representatives from the Investment Manager

are in attendance to present verbal and written

reports covering the Company’s activity, portfolio

and investment performance over the preceding

period. Communication between the Board and the

Investment Manager and other service providers

is maintained between formal meetings. The

Board endeavours to provide support, robust and

objective challenge and a different perspective

to the Investment Manager, to help optimise the

performance of the Company. The Board and the

Investment Manager operate in a fully co-operative

and open environment. The Board has formalised

arrangements under which the Directors, in the

furtherance of their duties, may take independent

professional advice at the Company’s expense.

As permitted by its Articles of Association and

subject to the provisions of UK legislation, the

Company has granted a third-party indemnity to

each Director in respect of liabilities which they may

sustain or incur in connection with the discharge

of their duties as a Director. The indemnity also

Scheduled

Board meetings

Scheduled Audit

Committee meetings

Scheduled

Management

Engagement

Committee meetings

Scheduled

Nomination and

Remuneration

Committee meetings

Number

entitled to

attend

Number

attended

Number

entitled to

attend

Number

attended

Number

entitled to

attend

Number

attended

Number

entitled to

attend

Number

attended

Peter Dicks 4 4 2 2 1 1 1 1

Louise Bonham 4 4 2 2 1 1 1 1

Davina Walter 4 4 2 2 1 1 1 1

Ashe Windham 4 4 2 2 1 1 1 1

Annual Report 2024 | Miton UK MicroCap Trust plc | 37

covers reasonable legal and other defence expenses,

although these would have to be repaid in the event

of a conviction. Deeds of indemnity in favour of each

of the Directors were executed on behalf of the

Company on their appointment and remain in force

as at the date of signing of this Report. There are no

other qualifying third party indemnity provisions in

place. In addition, Directors are covered by Directors

and Officers’ liability insurance.

Board Committees

In order to enable the Directors to discharge their

duties, there are three Board committees, each with

written terms of reference. Committee membership

is set out on page 30 of this Report. Attendance at

meetings of the committees is restricted to members

and persons expressly invited to attend. The Chairman

of the Board acts as Chairman for the committees,

with the exception of the Audit Committee, which is

currently chaired by PeterDicks.

The Company Secretary acts as the Secretary to

eachcommittee.

The Terms of Reference of each committee are

available on the Company’s website at www.

mitonukmicrocaptrust.com/documents/.

Further details on the composition and role of

the Audit Committee and its activities during the

financial year can be found on pages 41 to 43.

Board Evaluation

The Directors recognise the value of continually

monitoring and enhancing the performance of

the Board and view the regular evaluation of the

Board, its Committees and individual Directors as

a means of obtaining valuable feedback on areas

fordevelopment.

In the year ended 30 April 2024, the Board

conducted an annual review of its performance

and that of the Chairman and individual Directors

by way of questionnaires, which addressed the

areas indicated by the AIC Code. In particular,

the questionnaires were designed to assess the

qualifications, independence, composition, diversity,

and performance of the Board, and the performance

of the Board’s Committee, the Chairman and

individual Directors. The questionnaires were

also intended to assess whether the focus of

Board meetings and the information provided

were appropriate and to identify any training and

development needs for individual Directors.

The Board concluded that the Board has effective

oversight of the management of the Company and

has the appropriate diversity of skills and experience

to safeguard shareholders’ interests. The review did

not identify any areas of concern.

Independence of Directors

In accordance with the AIC Code, the Board

evaluation included a review of the independence of

each individual Director and the Board as a whole.

Mr Dicks holds less than 0.5% of the issued share

capital of Premier Miton Group Plc, the parent

company of the Investment Manager. The Board

considers the holding to be immaterial and of no

impact to his independence.

None of the Directors has any significant

shareholdings in companies where the Company

has a notifiable stake or a holding which amounts to

more than 1% of the Company’s portfolio.

The Board is of the view that, having reviewed all

required factors, all Directors met, and continue

to meet, the independence criteria set out in the

AICCode.

The Board’s policy on diversity is to ensure that

the Directors on the Board have a broad range of

experience, skills and knowledge, with diversity of

thinking, background and perspective. Appointments

to the Board are made on merit against objective

criteria, having regard to the benefits of diversity and

the current and future needs of the business and the

other factors set out in the AIC Code.

Diversity, including, but not limited to, gender,

social background, ethnicity, age, sexual orientation,

disability and professional and industry specific

knowledge, is an important consideration in

ensuring that the Board and its committees have

the right balance of skills, experience, independence

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

38 | Miton UK MicroCap Trust plc | Annual Report 2024

Corporate Governance Statement continued

and knowledge necessary to discharge their

responsibilities. The Board notes the new FCA rules on

diversity and inclusion on company boards, namely,

that from accounting periods starting on or after

1April 2023:

a) At least 40% of individuals on the Board to

bewomen;

At least one senior Board position to be held by a

woman; and

At least one individual on the Board to be from a

minority ethnic background.

In accordance with Listing Rule 9 Annex 2.1, the

below tables, in prescribed format, show the gender

and ethnic background of the Directors at the date

of this Report.

The data in the above tables was collected through

self-reporting by the Directors.

As at 30 April 2024 the Board comprised of four

members. The gender breakdown is as follows:

2 (50% female); 2 (50% male). The ethnic diversity

target (that at least one individual on the Board is

from a minority ethnic background) has not been

met. Whilst the Board does not feel that it would

be appropriate to set targets as all appointments

must be made on merit, the Board supports the

recommendations for senior positions to be held

by female directors and ethnic representation

on the Board, and both of these factors are key

considerations in succession planning.

Election/Re-election of Directors

Under the Company’s Articles of Association,

Directors are required to retire at the first Annual

General Meeting following their appointment and

offer themselves for election.

Thereafter, Directors are required to retire from

office and stand for re-election at intervals of not

more than three years. The AIC Code and UK Code

recommend that all Directors should be subject to

annual re-election by shareholders. The Company

recognises this to be good corporate governance

and has therefore chosen to follow this practice. The

maximum length of service for any Director will be

nine years from first election. Exceptions could be

made in unusual circumstances, for example if the

Company were in the middle of a corporate action.

Conﬂicts of Interest

Under the Articles of Association of the Company,

the Board must consider and, if it sees fit, may

authorise situations where a Director has an interest

that conflicts, or may possibly conflict, with the

interests of the Company.

In line with the AIC code 2019, the Board has

established a formal system to consider authorising

such conflicts, whereby the Directors who have no

interest in the matter decide whether to authorise

the conflict and any conditions to be attached to

such authorisations.

Diversity Table

Number

Board

members

Percentage

on the Board

Number

senior

positions on

the Board

Men

50% 1

Women*

50% 1

Not speciﬁed/

prefer not to say — — —

* Davina Walter was appointed Senior Independent Director on 1 May 2024,

making one woman in a senior position.

Diversity Table

Number

Board

members

Percentage

on the Board

Number

senior

positions on

the Board

White British

or other White

(including

minority white

groups) 4

100% 2

Mixed/Multiple

Ethnic Groups — — —

Asian/Asian

British — — —

Black/African/

Caribbean/Black

British — — —

Other ethnic

group, including

Arab — — —

Not speciﬁed/

prefer not to say — — —

Annual Report 2024 | Miton UK MicroCap Trust plc | 39

Stewardship Responsibilities and the use of

VotingRights

As an externally-managed investment company,

the majority of the responsibilities of the Board in

relation to engagement with investee companies are

delegated to the Investment Manager.

The Board retains oversight of the investor

stewardship exercised on its behalf by reviewing

the Investment Manager’s stewardship and voting

policies, considering the regular updates on

engagement provided by the Investment Manager

and holding the Investment Manager to account.

The Investment Manager has published a statement

of compliance with the UK Stewardship Code, which

is available on its website at www.premiermiton.

com. The Board reviews this statement of

complianceannually.

Company Secretary

The Board has direct access to the advice and

services of the Secretary, Northern Trust Secretarial

Services (UK) Limited. The Secretary is responsible

for ensuring that Board and Committee procedures

are followed and that information and reports

are delivered to the Board on a timely basis. The

Secretary is also responsible for ensuring that

applicable regulations are complied with and the

statutory obligations of the Company are met.

Internal Controls and Risk Management Systems

The Board has overall responsibility for establishing

and maintaining the Company’s systems of internal

controls and risk management and the reliability

of the financial reporting process and for reviewing

their effectiveness.

The Directors have reviewed and considered the

guidance supplied by the FRC on Risk Management,

Internal Control, and Related Finance and

Business Reporting and an ongoing process has

been established for identifying, evaluating and

managing the risks faced by the Company. The

Board maintains a risk matrix, which consists of a

detailed risk and internal control assessment and

provides the basis for the Committee and the Board

to regularly monitor the effective operation of the

controls and to update the risk matrix when new

risks are identified. This process, together with key

procedures established with a view to providing

effective financial control, was in place during the

year under review and was in place at the date of

the signing of this Report. The risk management

process and Company’s systems of internal control

are designed to assist the Board in making better,

more informed decisions with a view to creating and

protecting shareholder value.

The internal control systems are designed to ensure

that proper accounting records are maintained,

that the financial information on which business

decisions are made and which are issued for

publication is reliable and that the assets of the

Company are safeguarded. The purpose of risk

management is to manage rather than eliminate

the risk of failure in achieving the Company’s

objectives and involves Directors exercising

judgement. It should be recognised that such

systems can only provide reasonable, not absolute,

assurance against material misstatement or loss.

Internal Controls Assessment

Regular risk assessments and reviews of internal

controls will be undertaken in the context of the

Company’s overall investment objective. The

Board, through the Committee, has identified risk

management controls in four key areas: corporate

strategy; compliance with laws and regulations and

disclosure; relationships with service providers; and

investment and business activities. In arriving at

its judgment of what risks the Company faces, the

Board has considered the Company’s operations in

the light of the following factors:

•

the nature and extent of risks which it regards

as acceptable for the Company to bear within its

overall business objective;

The

Company

Strategic

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Information

40 | Miton UK MicroCap Trust plc | Annual Report 2024

•

the threat of such risks becoming reality;

•

the Company’s ability to reduce the incidence and

impact of risk on its performance; and

•

the cost to the Company and benefits related

to the Company and third parties operating the

relevant controls.

The risk matrix, established and maintained by the

Company, is structured so as to allow the Board

to assess the risks against how those risks are

managed. The risks are assessed on the basis of the

likelihood of occurrence, the impact on the business

if they were to occur and the effectiveness of the

controls in place to mitigate them. The risk register is

reviewed at meetings of the Audit Committee and at

other times as necessary.

The Board also reviews information provided by

the Investment Manager and the Secretary on a

regularbasis.

Most functions for the day-to-day management of

the Company are sub-contracted to appropriately

qualified third parties, and the Board therefore

obtains regular assurances and information from

key third party suppliers, including the Investment

Manager, the Administrator and the Depositary,

regarding the internal systems and controls operated

in their organisations. In addition, each of the third

parties is requested to provide a copy of its report on

internal controls each year, which is reviewed by the

Management Engagement Committee.

The Board has carried out a review of the

effectiveness of the risk management and systems

of internal control as they have operated over the

year under review and up to the date of approval

of this Report. No significant failings or weaknesses

were identified from that review and there were no

matters arising which required further investigation.

Shareholder Relations

The Board is committed to ensuring there is open

and effective communication with the Company’s

shareholders and in order that the Directors

understand the views of major shareholders

on matters such as governance, strategy and

performance. Accordingly, both the Board and

the Investment Manager give a high priority to

shareholder engagement and the Chairman and

other Directors are available to enter into dialogue

with shareholders. The Investment Manager and the

Company’s Stockbroker, Peel Hunt LLP, maintain a

regular dialogue with major investors and provide

the Board with regular reports on feedback from

shareholders.

All shareholders are encouraged to attend, ask

questions and vote at the Company’s AGM to be held

on 24 September 2024. A presentation by the fund

managers of the Trust will be delivered following the

formal business of the AGM and will also be available

on the Company’s website following the meeting.

The Annual and Half-Yearly Reports of the Company

are prepared by the Board and its advisers to present

a full and readily understandable review of the

Company’s performance. Copies are released to the

London Stock Exchange, and the Annual Report is

dispatched to shareholders by mail. They are also

available from the Secretary or on the Company’s

website, www.mitonukmicrocaptrust. com/

documents/.

Corporate Governance Statement continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 41

Audit Committee Report

I am pleased to present the Audit Committee (the ‘Committee’) Report for the financial year ended 30 April 2024.

Composition and Operation of the Committee

Given the small size of the Board, it is deemed

both proportionate and practical for all Directors

to be on the Committee, including the Chairman

of the Company who is considered independent.

The Board considers that the members of the

Committee have the requisite skills and experience,

relevant to the sector, as a result of their involvement

in financial services, to fulfil the responsibilities of

theCommittee.

Under its terms of reference, the Committee

is required to meet twice a year to discuss the

publication of the Company’s financial statements.

Additional meetings are convened as necessary and

the Committee held one additional meeting during

the year for the purpose of receiving a presentation

from BDO on their report on the annual financial

report and reviewing the annual financial report.

Role of the Committee

The primary responsibilities of the Committee are:

•

to monitor the integrity of the financial

statements of the Company and review the

content of the Company’s half-year and annual

reports and any formal announcements regarding

its financial reporting issues and areas of

judgement contained within them;

•

to advise the Board on whether the content of the

annual report and accounts, taken as whole, is fair,

balanced and understandable and provides the

information necessary for shareholders to assess

the Company’s performance, business model and

strategy;

•

to monitor and keep under review the adequacy

and effectiveness of the Company’s internal

financial controls and risk management and

internal control systems;

•

to make recommendations to the Board in relation

to the selection, appointment, re-appointment or

removal of the external auditor, following a review

of their independence, objectivity, qualifications,

expertise and resources;

•

to approve the remuneration and terms of

engagement of the external auditor for audit and

non-audit services; and

•

to review the scope, findings and effectiveness of

the external audit process.

The Committee has direct access to the Company’s

external auditor, BDO LLP, and provides a forum

through which the external auditor reports to the

Board. Representatives of the external auditor attend

meetings of the Committee at least annually.

Principal Activities of the Committee during the Year

The Committee met three times during the year

under review and during those meetings it has:

•

reviewed the Company’s Annual Report for the

financial year ended 30 April 2023 and the related

results announcements and the Half-Yearly

Report to 31 October 2023;

•

received and discussed with the Auditor their

findings from the audit of the financial year

ended 30 April 2023 and the effectiveness of the

external audit process;

•

reviewed the effectiveness of the risk management

systems and internal controls of the Company and

related reports from the Investment Manager and

other third party providers; and

•

agreed the Auditor’s fees.

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42 | Miton UK MicroCap Trust plc | Annual Report 2024

Audit Committee Report continued

The Committee also met once post the year end to

review the Company’s Annual Report for the year

ended 30 April 2024.

Other matters reviewed by the Committees include:

•

The Committee’s terms of reference;

•

The Company’s risk matrix;

•

The Company’s policy on the supply of non-audit

services by external auditor; and

•

The whistleblowing policy of Premier Portfolio

Managers Limited.

The Committee receives a report on internal control

and compliance from the Investment Manager’s

Compliance officer on a six-monthly basis and

discusses this with the Investment Manager. The

Investment Manager has in place a compliance

monitoring plan for testing of controls as an

alternative to establishing a separate internal

auditfunction.

The Committee monitors and reviews the

effectiveness of the external audit process for

the Annual Report, including a detailed review

of the audit plan and the audit results report,

and makes recommendations to the Board on

the re-appointment, remuneration and terms of

engagement of the Auditor. Any concerns with the

effectiveness of the external audit process would be

reported to the Board. No concerns were raised in

respect of the year ended 30 April 2024.

Audit Fees and Non-Audit Services

An audit fee of £59,350 (exclusive of VAT) has been

agreed in respect of the audit for the financial year

ended 30 April 2024 (2023: £53,500 exclusive of VAT).

No non-audit services were provided in the financial

year ended 30 April 2024. The Committee has a

policy on the engagement of the Auditor to supply

non-audit services. All requests for services to be

provided by the external auditor are submitted to

the Committee in order to ensure that the scope

and nature of the proposed work does not affect the

Auditor’s independence or objectivity.

Independence and Objectivity of the Auditor

Following its review of the independence and

objectivity of the Auditor, the Committee has been

reassured that no conflicts have arisen during the

year. The Committee will, however, continue to

monitor the position.

Re-appointment of the Auditor

BDO LLP was appointed as Auditor in April 2020.

Following consideration of the performance of BDO

LLP, the service provided during the year and a

review of their value for money, the Committee has

recommended to the Board their re-appointment

as Auditor to the Company at the Company’s

forthcoming AGM.

BDO LLP has been Auditor to the Company since

April 2020 and Vanessa-Jayne Bradley has been the

audit partner since that time. Rotation of the audit

partner will take place every five years in accordance

with the FRC revised Ethical Standard 2016. Under

the FRC transitional arrangements, the Company

is required to re-tender, at the latest, by 2030. The

Company intends to re-tender within the timeframe

set by the FRC. Due to the short period of time

since the Auditor was appointed, it is not considered

appropriate to review the Auditor’s succession at

this point in time. The Committee will regularly

consider the level of fees and the independence and

objectivity of the Auditor.

Annual Report 2024 | Miton UK MicroCap Trust plc | 43

Signiﬁcant Audit Issues considered by theCommittee

Following discussion with the Investment Manager and Auditor, the Committee determined that the key

risks in relation to the Company’s financial statements and how they were addressed were:

Risk Mitigation

Incomplete or inaccurate revenue recognition

The recognition of income is undertaken in

accordance with the stated accounting policies of

the Company.

The Directors review the Company’s income,

revenue forecasts and the sensitivity of the revenue

account to falls in income. Particular attention is

paid to any special dividends that the Company

mayreceive.

The valuation and ownership of the investment portfolio

The Company’s investments have been valued

in accordance with the accounting policies, as

disclosed in note 11 to the financial statements.

The great majority of investments are in quoted

securities in active markets, are considered to be

liquid and have been categorised as Level 1 and 2

within the IFRS 13 fair value hierarchy. These are

disclosed in note 12 to the financial statements.

The portfolio holdings and their pricing is reviewed

and verified by the Investment Manager on a

regular basis and management accounts, including

a full portfolio listing, are prepared for each Board

meeting. The Company uses the services of an

independent Depositary (Northern Trust Investor

Services Limited) to hold the assets of the Company.

The Depositary checks the consistency of its records

with those of the Investment Manager on a monthly

basis and reports to the Board on an annual basis.

Maintenance of investment trust status

There is a risk of failure to maintain investment trust

status in accordance with s1158/1159 which would

have a significant impact on the Company as a

result of the potential capital gains tax payable.

The Investment Manager and Administrator have

reported to the Audit Committee to confirm

continuing compliance with the requirements for

maintaining investment trust status.

Peter Dicks

Audit Committee Chairman

11 July 2024

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44 | Miton UK MicroCap Trust plc | Annual Report 2024

Directors’ Remuneration Report

The Board has prepared this report in accordance

with the requirements of the Large and Medium-

Sized Companies and Groups (Accounts and

Reports) (Amendment) Regulations 2013. An

ordinary resolution for the approval of the Directors’

Remuneration Report will be put to shareholders

at the forthcoming AGM. The law requires the

Company’s Auditor to audit certain of the disclosures

provided. Where disclosures have been audited,

they are indicated as such. The Auditor’s opinion is

included in the Independent Auditor’s Report on

pages 49 to 55.

Statement from the Chairman

Given the size of the Board, it is not considered

appropriate for the Company to have a separate

remuneration committee and the functions of

this committee are therefore delegated to a joint

Nomination and Remuneration Committee. All

Directors are members of this Committee which is

chaired by the Chairman, Ashe Windham. The Board

consists entirely of independent non-executive

Directors and the Company has no employees. We

have not, therefore, reported on those aspects of

remuneration that relate to executive directors.

Directors’ fees for the year ended 30 April 2024 are

set out on page 45.

Directors’ Remuneration Policy

This Remuneration policy was last approved

by shareholders at the Company’s AGM held in

September 2022. As a binding vote on the policy is

necessary every three years, an ordinary resolution

to approve the policy will be put to shareholders at

the AGM in 2025. The Remuneration policy is set

outbelow.

The level of remuneration has been set in order to

attract individuals of a calibre appropriate to the

future development of the Company and to reflect

the specific circumstances of the Company, the

duties and responsibilities of the Directors and

the value and amount of time committed to the

Company’s affairs.

The fees for the Directors are determined within the

limits (not to exceed £500,000 per year in aggregate)

set out in the Company’s Articles of Association,

or any greater sum that may be determined by an

ordinary resolution of the Company. The Chairman

does not participate in any discussions relating to his

own fee, which is determined by the independent

Directors. Directors are not eligible for bonuses,

share options or long- term incentive schemes or

other performance related benefits as the Board

does not believe that this is appropriate for non-

executivedirectors.

The fees for the Directors will be increased annually,

effective from the first day of the Company’s

financial year, by the rate of the Consumer Price

Index prevailing at that time.

Under the Company’s Remuneration Policy, the fees

for the Directors increase annually, effective from

the first day of the Company’s financial year, by the

rate of the Consumer Price Index prevailing at that

time. For FY2024, with March 2023 CPI reaching

10.1%, the Directors unanimously agreed not to

accept an increase in fees. However, it is not practical

to forego pay increases each year as the Company

would fall behind peers and be unable to attract

sufficiently skilled and experienced new directors, and

accordingly for the financial year 2025, the Directors’

fees will increase in line with the Remuneration Policy.

Under the Company’s Articles of Association, if

any Director is called upon to perform extra or

special services of any kind, he/she shall be entitled

to receive such sum as the Board may think fit

for expenses, and also such remuneration as the

Board may think fit, either as a fixed sum or as

a percentage of profits or otherwise, and such

remuneration may, as the Board shall determine, be

either in addition to or in substitution for any other

remuneration he may be entitled toreceive.

Directors are entitled to be paid all reasonable

expenses properly incurred in attending Board,

Committee or shareholder meetings or otherwise

in or with a view to the performance of their duties.

There are no amounts set aside or accrued by the

Company to provide pension, retirement or similar

benefits to the Directors.

Annual Report 2024 | Miton UK MicroCap Trust plc | 45

Component Director

Rate as at

1 May 2024

Rate as at

1 May 2023

Purpose of

Remuneration

Annual Fee Chairman £39,800 £38,400 Commitment as Chairman

Annual Fee Non-executive Directors £28,500 £27,500 Commitment as a non-executive Director

Additional Fee Audit Committee Chairman £4,200 £5,500 For additional responsibilities and time commitment

Additional Fee Senior Independent Director £1,500

Included as

part of Audit

Chair fees

in2023

For additional responsibilities and time commitment

Additional Fee All Directors N/A N/A

For extra or special services performed in their role

as a Director

Expenses All Directors N/A N/A

No ﬁxed rate. Reimbursement of expenses incurred

in the performance of duties as a Director

Year ended

30 April 2024

Year ended

30 April 2023

Fixed fees

Expenses

Total

Fixed fees

Expenses

Total

Louise Bonham

27, 500 — 27,500 10,436 — 10,436

Peter Dicks 33,000 — 33,000 33,000 — 33,000

Jan Etherden

— — — 17,205 — 17,205

Davina Walter 27,500 — 27.500 27,500 — 27.500

Ashe Windham 38,400 — 38,400 38,400 — 38,400

126,400 — 126,400 126,541 — 126,541

 Appointed on 15 December 2022

Resigned on 15 December 2022

The Company’s policy is for the Chairman of the Board to be paid a higher fee than the other Directors to reﬂect the more onerous role

The Company’s Articles of Association limit the total aggregate annual fees that can be paid to £500,000

The Company’s policy is for the Senior Independent Director and Chairman of the Audit Committee to be paid a higher fee than other Directors to reﬂect the

more onerous role

Additional fees would only be paid in exceptional circumstances in relation to the performance of extra or special services

Fees for any new Director appointed will be on the above basis. Fees payable in respect of subsequent periods

will be determined following an annual review. Any views expressed by shareholders on the fees being paid to

Directors will be taken into consideration by the Board.

It is the Board’s policy that Directors do not have service contracts, but Directors are provided with a letter of

appointment as a non-executive Director. The terms of their appointment provide that Directors shall retire

and be subject to election at the first Annual General Meeting after their appointment. Compensation will not

be made upon early termination of appointment.

Directors’ Fees for the Year (audited)

The remuneration paid to the Directors for the years ending 30 April 2024 and 30 April 2023 is set out in the

single total figure table below:

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46 | Miton UK MicroCap Trust plc | Annual Report 2024

Directors’ Remuneration Report continued

Annual Percentage Change in Directors’ Remuneration

The following table sets out the annual percentage change in Directors’ fees for the previous three years to

30 April 2024.

Percentage

change from

2023 to 2024

Percentage

change from

2022 to 2023

Percentage

change from

2021 to 2022

Louise Bonham

0% N/A N/A

Peter Dicks 0% 4.6% 1.5%

Jan Etherden

— N/A 1.5%

Davina Walter 0% 30.5% 100.0%

Ashe Windham 0% 22.6% 13.1%

 Appointed on 15 December 2022

Resigned on 15 December 2022

Company Performance

The Company does not have a specific benchmark

against which performance is measured. The graph

opposite compares the total return (assuming all

dividends are reinvested) to holders of Ordinary

Shares since they were first admitted to the Official

List of the Financial Conduct Authority, compared

to the total shareholder return of the Deutsche

Numis Smaller Companies 1000 Index, which is the

closest broad index against which to measure the

Company’s performance.

Adjusted NAV versus Deutsche Numis SC 1000 Index

Source: Morningstar

Deutsche Numis SC 1000 Index

100

150

200

250

Apr-15

Oct-15

Apr-16

Oct-16

Apr-17

Oct-17

Apr-18

Oct-18

Apr-19

Oct-19

Apr-20

Oct-20

Apr-21

Oct-21

Apr-22

Oct-22

Apr-23

Oct-23

Apr-24

Percent

MINI Adjusted NAV

Annual Report 2024 | Miton UK MicroCap Trust plc | 47

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Shareholder

Information

The table below shows the proportion of the

Company’s income spent on pay.

30 April

2024

£000

30 April

2023

£000

Change

Total remuneration paid

to Directors 126 127 (0.8)

Investment Management fee 392 597 (34.3)

Distribution to shareholders:

– dividends 142 142 —

– share buyback/

redemption 9,439 10,507 (10.2)

Note: The items listed in the table above are as required by the Large and

Medium-sized Companies and Groups (Accounts and Reports) (Amendment)

Regulations 2073 ss.20 with the exception of the investment management

fee, which has been included because the Directors believe it will help

shareholders’ understanding of the relative importance of the spend on

pay The ﬁgures for this measure are the same as those shown in note 6 to

the ﬁnancial statements. The amounts spent on the redemption of shares

are included in line with the GC700 and Investor Group guidance, as this

is considered a signiﬁcant payment. The ﬁgures for this measure are the

same as those shown in the Statement of Changes in Equity and Cash

FlowStatement.

Directors’ Beneﬁcial and Family Interests (audited)

There is no requirement under the Company’s

Articles of Association or the terms of their

appointment for Directors to hold shares in the

Company. The interests of the Directors and their

families in the Ordinary Shares of the Company as

at 30 April 2024 are set out below:

Number of

Ordinary

Shares as at

30 April 2024

Number of

Ordinary

Shares as at

30 April 2023

Peter Dicks

1, 067,928

468,150

Louise Bonham

50,400

48,800

Ashe Windham

310,000

225,000

Davina Walter

33,228

There have been no further changes to the

Directors’ share interests between 30 April 2024 and

the date of this Report.

Voting at the Annual General Meeting

The Directors’ Remuneration Report for the year

ended 30 April 2023 was approved by shareholders at

the AGM held on 26 September 2023. The Directors

Remuneration Policy was approved by shareholders

at the 2022 AGM. The votes cast for each were

asfollows:

Directors’

Remuneration Report

(2023 AGM results)

Directors’

Remuneration Policy

(2022 AGM results)

Number

of votes

% of

votes

cast

Number

of votes

% of

votes

cast

For 39,726,218 99.58 38,324,504 99.61

Against 167,153 0.42 150,778 0.39

Total votes cast 39,893,371 38,475,282

Number of votes

withheld 107,930 78,354

Approval

The Directors’ Remuneration Report was approved

by the Board on 11 July 2024.

On behalf of the Board

Ashe Windham

Chairman

11 July 2024

48 | Miton UK MicroCap Trust plc | Annual Report 2024

The Directors are responsible for preparing the

annual report and the financial statements in

accordance with applicable law and regulations.

Company law and UK adopted international

accounting standards require the Directors to

prepare financial statements for each financial year.

Under that law the Directors have elected to prepare

the Company’s financial statements in accordance

with UK adopted international accounting standards.

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 group and company and of the profit or

loss for the company for that period.

In preparing these financial statements, the

Directors are required to:

•

Select suitable accounting policies and then apply

them consistently;

•

Make judgments and accounting estimates that

are reasonable and prudent;

•

State whether they have been prepared in

accordance with UK adopted international

accounting standards, subject to any material

departures disclosed and explained in the

financial statements;

•

Prepare the financial statements on the going

concern basis unless it is inappropriate to

presume that the company will continue in

business;

•

Prepare a Director’s report, a Strategic report and

a Director’s remuneration report which comply

with the requirements of the Companies Act

2006.

The Directors are responsible for keeping adequate

accounting records that are sufficient to show and

explain the Company’s transactions and disclose

with reasonable accuracy at any time the financial

position of the Company and enable them to ensure

that the financial statements comply with the

Companies Act 2006.

They are also responsible for safeguarding the assets

of the Company and hence for taking reasonable

steps for the prevention and detection of fraud and

other irregularities.

The Directors are responsible for ensuring that the

annual report and accounts, taken as a whole, are

fair, balanced, and understandable and provide the

information necessary for shareholders to assess the

group’s performance, business model and strategy.

Website publication

The Directors are responsible for ensuring the

annual report and the financial statements are made

available on its website. Financial statements are

published on the Company’s website in accordance

with legislation in the United Kingdom governing

the preparation and dissemination of financial

statements, which may vary from legislation in

other jurisdictions. The maintenance and integrity

of the Company’s website is the responsibility of the

Directors. The Directors’ responsibility also extends

to the ongoing integrity of the financial statements

contained therein.

The Directors confirm to the best of their knowledge:

•

The financial statements have been prepared

in accordance with UK adopted international

accounting standards in conformity with the

requirements of the Companies Act 2006 and

give a true and fair view of the assets, liabilities,

financial position and profit and loss of the group.

•

The annual report includes a fair review of the

development and performance of the business

and the financial position of the Company,

together with a description of the principal risks

and uncertainties that they face.

On behalf of the Board

Ashe Windham

Chairman

11 July 2024

Statement of Directors’ Responsibilities

Annual Report 2024 | Miton UK MicroCap Trust plc | 49

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Opinion on the ﬁnancial statements

In our opinion the financial statements:

•

give a true and fair view of the state of the

Company’s affairs as at 30 April 2024 and of its loss

for the year then ended;

•

have been properly prepared in accordance with

UK adopted international accounting standards;

and

•

have been prepared in accordance with the

requirements of the Companies Act 2006.

We have audited the financial statements of Miton

UK Microcap Trust plc (the “Company”) for the year

ended 30 April 2024 which comprise the Income

Statement, the Statement of Changes in Equity, the

Balance Sheet, the Statement of Cash Flows and

the notes to the financial statements, including

a summary of material accounting policies. The

financial reporting framework that has been

applied in their preparation is applicable law and UK

adopted international accounting standards.

Basis for opinion

We conducted our audit in accordance with

International Standards on Auditing (UK) (ISAs

(UK)) and applicable law. Our responsibilities

under those standards are further described in the

Auditor’s responsibilities for the audit of the financial

statements section of our report. We believe that the

audit evidence we have obtained is sufficient and

appropriate to provide a basis for our opinion. Our

audit opinion is consistent with the additional report

to the audit committee.

Independence

Following the recommendation of the audit

committee, we were appointed formally by the

members at the Annual General Meeting on

on 22 September 2020 to audit the financial

statements for the year ended 30 April 2020 and

subsequent financial periods. The period of total

uninterrupted engagement including retenders

and reappointments is 5 years, covering the years

ended 30 April 2020 to 30 April 2024. We remain

independent of the Company in accordance with

the ethical requirements that are relevant to our

audit of the financial statements in the UK, including

the FRC’s Ethical Standard as applied to listed public

interest entities, and we have fulfilled our other

ethical responsibilities in accordance with these

requirements. The non-audit services prohibited by

that standard were not provided to the Company.

Conclusions relating to going concern

In auditing the financial statements, we have

concluded that the Directors’ use of the going

concern basis of accounting in the preparation of the

financial statements is appropriate. Our evaluation

of the Directors’ assessment of the Company’s ability

to continue to adopt the going concern basis of

accounting included:

•

Evaluating the appropriateness of the Directors’

method of assessing the going concern in light of

economic and market conditions by reviewing the

information used by the Directors in completing

their assessment;

•

Assessing the appropriateness of the Directors’

assumptions and judgements made by

comparing the prior year forecasted costs to the

actual costs incurred to check that the projected

costs are reasonable;

•

Assessing the projected management fees for

the year to check that they are in line with the

current assets under management levels and

the projected market growth forecasts for the

following year;

•

Assessing the appropriateness of the Directors’

assumptions and judgements made in

their base case and stress tested forecasts

including consideration of the available cash

resources relative to forecast expenditure and

commitments; and

•

Challenging the Directors’ assumptions and

judgements made in their forecasts including

performing an independent analysis of the

liquidity of the portfolio.

Independent Auditor’s Report to the members of

Miton UK Microcap Trust plc

50 | Miton UK MicroCap Trust plc | Annual Report 2024

Independent Auditor’s Report to the members of

Miton UK Microcap Trust plc

continued

Based on the work we have performed, we have not identified any material uncertainties relating to

events or conditions that, individually or collectively, may cast significant doubt on the Company’s ability to

continue as a going concern for a period of at least twelve months from when the financial statements are

authorised for issue.

In relation to the Company’s reporting on how it has applied the UK Corporate Governance Code, we

have nothing material to add or draw attention to in relation to the Directors’ statement in the financial

statements about whether the Directors considered it appropriate to adopt the going concern basis of

accounting.

Our responsibilities and the responsibilities of the Directors with respect to going concern are described in

the relevant sections of this report.

Overview 2024 2023

Key audit matters

Valuation and ownership of investments

 

Materiality Company ﬁnancial statements as a whole

£0.4m (2023: £0.6m) based on 1% (2023: 1%) of net assets

An overview of the scope of our audit

Our audit was scoped by obtaining an understanding of the Company and its environment, including

the Company’s system of internal control, and assessing the risks of material misstatement in the

financial statements. We also addressed the risk of management override of internal controls, including

assessing whether there was evidence of bias by the Directors that may have represented a risk of material

misstatement.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our

audit of the financial statements of the current period and include the most significant assessed risks of

material misstatement (whether or not due to fraud) that we identified, including those which had the

greatest effect on: the overall audit strategy, the allocation of resources in the audit, and directing the

efforts of the engagement team. These matters were addressed in the context of our audit of the financial

statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on

these matters.

Annual Report 2024 | Miton UK MicroCap Trust plc | 51

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Key audit matter How the scope of our audit addressed the key auditmatter

Valuation and ownership of investments

(Notes 1, 11 and 12)

The investment portfolio at the year-end comprised of quoted

equity investments and a small number of unquoted investments

(warrants).

We considered the valuation and ownership of investments to be a

significant audit area as investments represent the most significant

balance in the financial statements and underpin the principal

activity of the entity.

There is a risk that the bid price used as a proxy for fair value of

investments held at the reporting date is inappropriate. Given the

nature of the portfolio is such that it comprises mostly of listed

level 1 investments, we do not consider the use of bid price to be

subject to significant estimation uncertainty. There is however an

element of subjectivity in relation to the valuation of the unquoted

investments (warrants).

There is also a risk of error in the recording of investment holdings

such that those recordings do not appropriately reflect the property

of the Company.

For these reasons and the materiality to the financial statements

as a whole, they are considered to be a key area of our overall

audit strategy and allocation of our resources and hence a Key

Audit Matter.

We responded to this matter by testing the valuation and

ownership of the whole portfolio of quoted investments. We

performed the following procedures:

•

Confirmed the year-end bid price was used by agreeing to

externally quoted prices;

•

Assessed if there were contra indicators, such as liquidity

considerations, to suggest bid price is not the most appropriate

indication of fair value by considering the realisation period for

individual holdings;

•

Recalculated the valuation by multiplying the number of shares

held per the statement obtained from the custodian by the

valuation per share; and

•

Obtained direct confirmation of the number of shares held per

equity investment from the custodian regarding all investments

held at the balance sheet date.

For all warrants held at the year end, we performed the following

procedures:

•

Considered the appropriateness of the valuation methodology

against the International Private Equity and Venture Capital

Valuation (“IPEV”) Guidelines and applicable accounting

standards;

•

Re-performed the calculation of the investment valuation

using a valuation model and compared to the Investment

Managers valuation;

•

Where appropriate, performed a sensitivity analysis where

reasonable alternative assumptions could exist; and

•

Obtained direct confirmation of the number of warrants held

from the custodian.

Key observations:

Based on our procedures performed we did not identify any

matters to suggest the valuation or ownership of the investments

was not appropriate.

Our application of materiality

We apply the concept of materiality both in planning and performing our audit, and in evaluating the

effect of misstatements. We consider materiality to be the magnitude by which misstatements, including

omissions, could influence the economic decisions of reasonable users that are taken on the basis of the

financial statements.

52 | Miton UK MicroCap Trust plc | Annual Report 2024

Independent Auditor’s Report to the members of

Miton UK Microcap Trust plc

continued

In order to reduce to an appropriately low level the probability that any misstatements exceed materiality,

we use a lower materiality level, performance materiality, to determine the extent of testing needed.

Importantly, misstatements below these levels will not necessarily be evaluated as immaterial as we also take

account of the nature of identified misstatements, and the particular circumstances of their occurrence,

when evaluating their effect on the financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole

and performance materiality as follows:

Company ﬁnancial statements

2024

£m

2023

£m

Materiality 0.4 0.6

Basis for determining materiality 1% of net assets

Rationale for the benchmark applied

As an investment trust, the net asset value is the key measure of

performance for users of the financial statements.

Performance materiality 0.3 0.5

Basis for determining performance materiality 75% of materiality

Rationale for the percentage applied for

performancemateriality

The level of performance materiality applied was set after having

considered a number of factors including the expected total value of

known and likely misstatements and the level of transactions in the year.

Reporting threshold

We agreed with the Audit Committee that we would

report to them all individual audit differences in

excess of £21,000 (2023: £30,000). We also agreed to

report differences below this threshold that, in our

view, warranted reporting on qualitative grounds.

Other information

The Directors are responsible for the other

information. The other information comprises

the information included in the Report and

Accounts other than the financial statements

and our auditor’s report thereon. Our opinion on

the financial statements does not cover the other

information and, except to the extent otherwise

explicitly stated in our report, we do not express

any form of assurance conclusion thereon. Our

responsibility is to read the other information

and, in doing so, consider whether the other

information is materially inconsistent with the

financial statements, or our knowledge obtained

in the course of the audit, or otherwise appears to

be materially misstated. If we identify such material

inconsistencies or apparent material misstatements,

we are required to determine whether this gives

rise to a material misstatement in the financial

statements themselves. If, based on the work we

have performed, we conclude that there is a material

misstatement of this other information, we are

required to report that fact.

We have nothing to report in this regard.

Annual Report 2024 | Miton UK MicroCap Trust plc | 53

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Corporate governance statement

The Listing Rules require us to review the Directors’ statement in relation to going concern, longer-term

viability and that part of the Corporate Governance Statement relating to the Company’s compliance with

the provisions of the UK Corporate Governance Code specified for our review.

Based on the work undertaken as part of our audit, we have concluded that each of the following elements

of the Corporate Governance Statement is materially consistent with the financial statements, or our

knowledge obtained during the audit.

Going concern and longer-term viability

•

The Directors’ statement with regards to the appropriateness of

adopting the going concern basis of accounting and any material

uncertainties identiﬁed; and

•

The Directors’ explanation as to their assessment of the Company’s

prospects, the period this assessment covers and why the period is

appropriate.

Other Code provisions

•

Directors’ statement on fair, balanced and understandable;

•

Board’s conﬁrmation that it has carried out a robust assessment of the

emerging and principal risks;

•

The section of the annual report that describes the review of

effectiveness of risk management and internal control systems; and

•

The section describing the work of the Audit Committee.

Other Companies Act 2006 reporting

Based on the responsibilities described below and our work performed during the course of the audit, we are

required by the Companies Act 2006 and ISAs (UK) to report on certain opinions and matters as described below.

Strategic report and Directors’ report In our opinion, based on the work undertaken in the course of the audit:

•

the information given in the Strategic report and the Directors’ report

for the ﬁnancial year for which the ﬁnancial statements are prepared is

consistent with the ﬁnancial statements; and

•

the Strategic report and the Directors’ report have been prepared in

accordance with applicable legal requirements.

In the light of the knowledge and understanding of the Company and its

environment obtained in the course of the audit, we have not identiﬁed

material misstatements in the strategic report or the Directors’ report.

Directors’ remuneration In our opinion, the part of the Directors’ remuneration report to be audited

has been properly prepared in accordance with the Companies Act 2006.

Matters on which we are required to report by exception We have nothing to report in respect of the following matters in relation

to which the Companies Act 2006 requires us to report to you if, in our

opinion:

•

adequate accounting records have not been kept, or returns adequate

for our audit have not been received from branches not visited by us;

•

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.

54 | Miton UK MicroCap Trust plc | Annual Report 2024

Independent Auditor’s Report to the members of

Miton UK Microcap Trust plc

continued

Responsibilities of Directors

As explained more fully in the Statement of Directors

Responsibilities, the Directors are responsible for

the preparation of the financial statements and

for being satisfied that they give a true and fair

view, and for such internal control as the Directors

determine is necessary to enable the preparation

of financial statements that are free from material

misstatement, whether due to fraud or error.

In preparing the financial statements, the Directors

are responsible for assessing the Company’s ability

to continue as a going concern, disclosing, as

applicable, matters related to going concern and

using the going concern basis of accounting unless

the Directors either intend to liquidate the Company

or to cease operations, or have no realistic alternative

but to do so.

Auditor’s responsibilities for the audit of the

ﬁnancial statements

Our objectives are to obtain reasonable assurance

about whether the financial statements as a whole

are free from material misstatement, whether due

to fraud or error, and to issue an auditor’s report

that includes our opinion. Reasonable assurance is

a high level of assurance but is not a guarantee that

an audit conducted in accordance with ISAs (UK)

will always detect a material misstatement when it

exists. Misstatements can arise from fraud or error

and are considered material if, individually or in the

aggregate, they could reasonably be expected to

influence the economic decisions of users taken on

the basis of these financial statements.

Extent to which the audit was capable of detecting

irregularities, including fraud

Irregularities, including fraud, are instances of

non-compliance with laws and regulations. We

design procedures in line with our responsibilities,

outlined above, to detect material misstatements in

respect of irregularities, including fraud. The extent

to which our procedures are capable of detecting

irregularities, including fraud is detailed below:

Non-compliance with laws and regulations

Based on:

•

Our understanding of the Company and the

industry in which it operates;

•

Discussion with the Investment Manager,

the Administrator and those charged with

governance; and

•

Obtaining and understanding of the Company’s

policies and procedures regarding compliance

with laws and regulations.

We considered the significant laws and regulations

to be Companies Act 2006, the FCA listing and DTR

rules, the principles of the AIC Code of Corporate

Governance, industry practice represented by the

AIC SORP, the applicable accounting framework,

and qualification as an Investment Trust under UK

tax legislation as any non-compliance of this would

lead to the Company losing various deductions and

exemptions from corporation tax.

Our procedures in respect of the above included:

•

Agreement of the financial statement disclosures

to underlying supporting documentation;

•

Enquiries of management and those charged

with governance relating to the existence of any

non-compliance with laws and regulations;

•

Reviewing minutes of meeting of those charged

with governance throughout the period for

instances of non-compliance with laws and

regulations; and

•

Reviewing the calculation in relation to

Investment Trust compliance to check that the

Company was meeting its requirements to retain

their Investment Trust Status. This included a

review of other qualitative factors and ensuring

compliance with these.

Annual Report 2024 | Miton UK MicroCap Trust plc | 55

Fraud

We assessed the susceptibility of the financial

statement to material misstatement including fraud.

Our risk assessment procedures included:

•

Enquiry with the Investment Manager, the

Administrator and those charged with governance

regarding any known or suspected instances of

fraud;

•

Review of minutes of meetings of those charged

with governance for any known or suspected

instances of fraud; and

•

Discussion amongst the engagement team as to

how and where fraud might occur in the financial

statements.

Based on our risk assessment, we considered the

areas most susceptible to be management override

of controls.

Our procedures in respect of the above included:

•

In addressing the risk of management override of

control, we:

•

Performed a review of estimates and

judgements applied by management in

the financial statements to assess their

appropriateness and the existence of any

systematic bias;

•

Considered the opportunity and incentive to

manipulate accounting entries and target

tested relevant adjustments made in the period

end financial reporting process;

•

Reviewed for significant transactions outside

the normal course of business; and

•

Performed a review of unadjusted audit

differences, if any, for indications of bias or

deliberate misstatement.

We also communicated relevant identified laws

and regulations and potential fraud risks to all

engagement team members, who were deemed to

have the appropriate competence and capabilities

and remained alert to any indications of fraud

or non-compliance with laws and regulations

throughout the audit.

Our audit procedures were designed to

respond to risks of material misstatement in the

financial statements, recognising that the risk

of not detecting a material misstatement due

to fraud is higher than the risk of not detecting

one resulting from error, as fraud may involve

deliberate concealment by, for example, forgery,

misrepresentations or through collusion. There

are inherent limitations in the audit procedures

performed and the further removed non-compliance

with laws and regulations is from the events and

transactions reflected in the financial statements,

the less likely we are to become aware of it.

A further description of our responsibilities is

available on the Financial Reporting Council’s

website at: www.frc.org.uk/auditorsresponsibilities.

This description forms part of our auditor’s report.

Use of our report

This report is made solely to the Company’s

members, as a body, in accordance with Chapter

3 of Part 16 of the Companies Act 2006. Our audit

work has been undertaken so that we might state

to the Company’s members those matters we are

required to state to them in an auditor’s report and

for no other purpose. To the fullest extent permitted

by law, we do not accept or assume responsibility to

anyone other than the Company and the Company’s

members as a body, for our audit work, for this

report, or for the opinions we have formed.

Vanessa-Jayne Bradley

Senior Statutory Auditor

For and on behalf of BDO LLP, Statutory Auditor

London, UK

11 July 2024

BDO LLP is a limited liability partnership registered

in England and Wales (with registered number

OC305127).

The

Company

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Company

Accounts

Shareholder

Information

56 | Miton UK MicroCap Trust plc | Annual Report 2024

Income Statement

of the Company for the year ended 30 April 2024

Year ended

30 April 2024

Year ended

30 April 2023

Company Notes

Revenue

return

£000

Capital

return

£000

Total

£000

Revenue

return

£000

Capital

return

£000

Total

£000

Losses on investments held at fair value through proﬁt or loss 11 — (7,272) (7,272) — (26,765) (26,765)

Losses on derivatives held at fair value through proﬁt or loss 13 — (351) (351) — (852) (852)

(Losses)/gains on foreign exchange — (11) (11) 2 — 2

Income 2 855 — 855 873 — 873

Management fee 6 (97) (295) (392) (149) (448) (597)

Other expenses 7 (672) — (672) (676) — (676)

Return/(loss) on ordinary activities before ﬁnance costs

and taxation

86 (7,929) (7,843) 50 (28,065) (28,015)

Finance costs 8 — (21) (21) — (39) (39)

Return/(loss) on ordinary activities before taxation 86 (7,950) (7,864) 50 (28,104) (28,054)

Taxation 9 (12) — (12) (18) — (18)

Return/(loss) on ordinary activities after taxation 74 (7,950) (7,876) 32 (28,104) (28,072)

Return/(loss) per Ordinary Share – basic and diluted (pence) 3 0.09 (9.26) (9.17) 0.03 (28.96) (28.93)

The total column of this statement is the Income Statement of the Company prepared in accordance

with UK International Accounting Standards in conformity with the requirements of UK IFRS. The

supplementary revenue return and capital return columns are presented in accordance with the Statement

of Recommended Practice issued by the Association of Investment Companies (“AIC SORP”).

All revenue and capital items in the above statement derive from continuing operations. No operations were

acquired or discontinued during the year.

There is no other comprehensive income and, therefore, the return on ordinary activities after taxation is both

the profit and the total comprehensive income.

The notes on pages 60 to 79 form part of these financial statements.

Annual Report 2024 | Miton UK MicroCap Trust plc | 57

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Statement of Changes in Equity

of the Company for the year ended 30 April 2024

For the year ended 30 April 2024 Notes

capital

£000

Capital

redemption

reserve

£000

premium

account

£000

Special

reserve

£000

Capital

reserve

£000

Revenue

reserve

£000

Total

£000

As at 30 April 2023 145 79 672 51,039 8,697 122 60,754

Total comprehensive income:

(Loss)/return on ordinary activities after taxation — — — — (7,950) 74 (7,876)

Transactions with shareholders recorded

directly to equity

Redemption of Ordinary Shares — — — (9,439) — — (9,439)

Cancellation of shares 4 (18) 18 — — — — —

Equity dividends paid 10 — — — (20) — (122) (142)

As at 30 April 2024 127 97 672 41,580 747 74 43,297

For the year ended 30 April 2023 Notes

capital

£000

Capital

redemption

reserve

£000

premium

account

£000

Special

reserve

£000

Capital

reserve

£000

Revenue

reserve

£000

Total

£000

As at 30 April 2022 160 64 672 61,546 36,801 232 99,475

Total comprehensive income:

(Loss)/return on ordinary activities after

taxation

— — — — (28,104) 32 (28,072)

Transactions with shareholders recorded

directly to equity

Redemption of Ordinary Shares — — — (10,507) — — (10,507)

Cancellation of shares 4 (15) 15 —

— — — —

Equity dividends paid 10 — — — — — (142) (142)

As at 30 April 2023 145 79 672 51,039 8,697 122 60,754

The notes on pages 60 to 79 form part of these financial statements.

58 | Miton UK MicroCap Trust plc | Annual Report 2024

Balance Sheet

of the Company as at 30 April 2024

Notes

30 April

2024

£000

30 April

2023

£000

Non-current assets:

Investments held at fair value through proﬁt or loss 12 41,292 56,068

Current assets:

Derivative instruments 13 2 169

Trade and other receivables 14 77 217

Cash at bank and cash equivalents 2,099 4,590

2,178 4,976

Liabilities:

Trade and other payables 15 173 290

Net current assets 2,005 4,686

Net assets 43,297 60,754

Capital and reserves

Share capital 4 127 145

Capital redemption reserve 97 79

Share premium account 672 672

Special reserve 41,580 51,039

Capital reserve 747 8,697

Revenue reserve 74 122

Shareholders’ funds 43,297 60,754

pence pence

Net asset value per Ordinary Share – basic and diluted 5 56.29 64.20

These financial statements were approved and authorised for issue by the Board of Miton UK MicroCap

Trustplc on 11 July 2024 and were signed on its behalf by:

Ashe Windham

Chairman

11 July 2024

Company No: 09511015

The notes on pages 60 to 79 form part of these financial statements.

Annual Report 2024 | Miton UK MicroCap Trust plc | 59

Statement of Cash Flows

of the Company for the year ended 30 April 2024

30 April

2024

£000

30 April

2023

£000

Operating activities:

Net loss before taxation (7,864) (28,054)

Loss on investments and derivatives held at fair value through proﬁt or loss 7,623 27,617

Decrease in trade and other receivables 23 39

Increase/(decrease) in trade and other payables 11 (13)

Amortisation of ﬁnance costs 21 33

Withholding tax paid (12) (18)

Net cash outﬂow from operating activities (198) (396)

Investing activities:

Purchase of investments (16,464) (15,404)

Purchase of derivative investments (195) (911)

Sale of investments 23,957 27,498

Sale of derivative instruments 11 691

Net cash inﬂow from investing activities 7,309 11,874

Financing activities:

Redemption/repurchase of Ordinary Shares (9,439) (10,507)

Equity dividends paid (142) (142)

Finance costs paid (21) (33)

Net cash outﬂow from ﬁnancing activities (9,602) (10,682)

(Decrease)/increase in cash and cash equivalents (2,491) 796

Reconciliation of net cash ﬂow movement in funds:

Cash and cash equivalents at the start of the year 4,590 3,794

Net cash (outﬂow)/inﬂow from cash and cash equivalents (2,491) 796

Cash at the end of the year 2,099 4,590

Cash and cash equivalents

Comprise the following:

Cash at bank 2,099 4,590

2,099 4,590

The notes on pages 60 to 79 form part of these financial statements.

The

Company

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Company

Accounts

Shareholder

Information

60 | Miton UK MicroCap Trust plc | Annual Report 2024

Notes to the Financial Statements continued

1. Accounting Policies

Miton UK MicroCap Trust plc is a company

incorporated and registered in England and Wales.

The principal activity of the Company is that of an

investment trust company within the meaning of

Sections 1158/1159 of the Corporation Tax Act 2010.

The financial statements of the Company have

been prepared in accordance with UK International

Accounting Standards. The financial statements

have also been prepared in accordance with the AIC

SORP for the financial statements of investment

trust companies and venture capital trusts.

Basis of Preparation

In order to better reflect the activities of an

investment trust company and in accordance

with guidance issued by the AIC, supplementary

information which analyses the Income Statement

between items of a revenue and capital nature has

been prepared alongside the Income Statement.

The financial statements are presented in Sterling,

which is the Company’s functional currency as the

UK is the primary environment in which it operates,

rounded to the nearest £1,000, except where

otherwise indicated.

Going Concern

The financial statements have been prepared on a

going concern basis and on the basis that approval

as an investment trust company will continue to

be met. The Directors have made an assessment

of the Company’s ability to continue as a going

concern based on detailed profit & loss and cash

flow forecasts. These forecasts have been ‘stressed’

for inflation, as well as a severe but plausible and

sudden downturn in market conditions under which

it is assumed that the investment portfolio will lose

50% of its value. Even under this extreme ‘stress’

scenario, the Company has adequate resources

to continue in operational existence for a period

of at least 12 months from the date when these

financial statements were approved. The Directors

also regularly assess the resilience of key third-party

service providers, most notably the Investment

Manager and Fund Administrator. The Directors do

not have any concerns about the financial viability

of the Company’s third-party service providers.

In making their assessment, the Directors have

considered the likely impacts of international and

economic uncertainties on the Company, operations

and the investment portfolio. These include, but are

not limited to, another global event similar to the

COVID-19 pandemic, the war in Ukraine, political

and economic instability in the UK, supply shortages

and inflationary pressures. The Directors noted that

the Company, with the current cash balance and

holding a portfolio of liquid listed investments, is

able to meet the obligations of the Company as they

falldue.

The Investment Manager assesses the exposure to

risk when making each investment decision and the

performance of the portfolio on a daily basis.

The current cash balance enables the Company

to meet any funding requirements and finance

future additional investments. The Company is a

closed-ended fund, where assets are not required

to be liquidated to meet day-to-day redemptions.

Furthermore, the Directors are not aware of any

material uncertainties that may cast significant

doubt on the Company’s ability to continue as

a going concern, having taken into account the

liquidity of the Company’s investment portfolio

and the Company’s financial position in respect of

its cash flows, borrowing facilities and investment

commitments (of which there are none of

significance). Therefore, the financial statements

have been prepared on a going concern basis.

Segmental Reporting

The Directors are of the opinion that the Company

is engaged in a single segment of business, being

investment business. The Company primarily invests

in companies listed in the UK.

Annual Report 2024 | Miton UK MicroCap Trust plc | 61

Accounting Developments

In the year under review, the Company has applied

amendments to IFRS issued by the IASB adopted

in conformity with UK IFRS. These include annual

improvements to IFRS, changes in standards,

legislative and regulatory amendments, changes

in disclosure and presentation requirements. This

incorporated:

•

Disclosure of Accounting Policies (Amendments

to IAS 1 and IFRS Practice Statement 2);

•

Initial application of IFRS 17 and IFRS 9 –

Comparative Information (Amendments to IFRS17);

•

Definition of Accounting Estimates (Amendments

to IAS 8); and

•

Deferred Tax Related to Assets and Liabilities

Arising from a Single Transaction –Amendments

to IAS 12 Income Taxes; and

•

Classification of liabilities as current or non-

current (Amendments to IAS 1)

The adoption of the changes to accounting standards

has had no material impact on these or prior years’

financial statements. There are amendments to IAS/

IFRS that will apply from 1 May 2024 as follows:

•

Non-current liabilities with Covenants

(Amendments to IAS 1).

•

Supplier Finance Arrangements (Amendments to

IAS 7 and IFRS 7)

•

Lease Liability in a Sale and Leaseback

(Amendments to IFRS 16)

Amendments to IAS/IFRS applicable from 1 May 2025

are:

•

Presentation and Disclosures in Financial

Statements (IFRS 18)

•

Subsidiaries without Public Accountability:

Disclosures (IFRS 19)

The Directors do not anticipate the adoption of

these will have a material impact on the financial

statements in current or future years.

Critical Accounting Judgments and Key Sources

of Estimation Uncertainty

The preparation of financial statements in

conformity with UK International Accounting

Standards requires management to make

judgements, estimates and assumptions that

affect the application of policies and the reported

amounts in the Balance Sheet, the Income

Statement and the disclosure of contingent

assets and liabilities at the date of the financial

statements. The estimates and associated

assumptions are based on historical experience

and various other factors that are believed to be

reasonable under the circumstances, the results of

which form the basis of making judgements about

carrying values of assets and liabilities that are not

readily apparent from other sources. Actual results

may differ from these estimates.

The areas requiring judgement and estimation in

the preparation of the financial statements are:

recognising and classifying unusual or special

dividends received as either revenue or capital in

nature; the valuation of warrants; and allocation of

expenses between capital and income and setting of

the level of dividends paid and proposed.

The estimates and underlying assumptions

are reviewed on an ongoing basis. Revisions to

accounting estimates are recognised in the period

in which the estimate is revised if the revision affects

only that period, or in the period of the revision and

future period if the revision affects both current and

future periods.

Investments

The Company’s business is investing in financial

assets with a view to profiting from their total

return in the form of income and capital growth.

This portfolio of investments is managed and its

performance evaluated on a fair value basis, in

accordance with a documented investment strategy,

and information about the portfolio is provided

internally on that basis to the Company’s Board

ofDirectors.

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

62 | Miton UK MicroCap Trust plc | Annual Report 2024

Notes to the Financial Statements continued

Upon initial recognition the Company designates

the investments ‘at fair value through profit or

loss’. They are included initially at fair value, which

is taken to be their cost (excluding expenses

incidental to the acquisition which are written off

in the Income Statement, and allocated to ‘capital’

at the time of acquisition). When a purchase or

sale is made under a contract, the terms of which

require delivery within the time-frame of the

relevant market, the investments concerned are

recognised or derecognised on the trade date.

Subsequent to initial recognition, investments are

valued at fair value through profit or loss. For listed

and quoted investments this is deemed to be bid

market prices or closing prices for Stock Exchange

Electronic Trading Service – quotes and crosses

(“SETSqx”). Changes in fair value of investments

are recognised in the income Statement as a

capital item. On disposal, realised gains and losses

are also recognised in the income Statement as

capitalitems.

Warrants give the Company the right, but not the

obligation, to buy common ordinary shares in an

investee company at a fixed price for a predefined

time period. The fair value is determined by the

Manager through use of models including Black

Scholes and discounted cashflows, using available

observable inputs of the warrant: the exercise share

price of the investee company, the expiration period

plus other factors including the prevailing interest

rate and associated risks.

All investments for which fair value is measured or

disclosed in the financial statements are categorised

within the fair value hierarchy in note 12.

Foreign Currency

Transactions denominated in foreign currencies

are converted to Sterling at the actual exchange

rate as at the date of the transaction. Monetary

assets and liabilities and assets carried at fair value

denominated in foreign currencies at the year end

are reported at the rate of exchange at the Balance

Sheet date. Any gain or loss arising from a change

in exchange rate subsequent to the date of the

transaction is included as an exchange gain or

loss in the capital reserve or the revenue account

depending on whether the gain or loss is of a capital

or revenue nature.

Derivatives

Derivatives, including Index Put Options, which

are listed investments, are classified as financial

instruments at fair value through profit or loss.

Derivatives are initially recorded at cost (being

premium paid to purchase the option) and

subsequently valued at fair value and included in

current assets/liabilities. Derivatives are derecognised

when the contract expires or on the trade date when

the contract is sold.

Changes in the fair value of derivative instruments

are recognised as they arise in the capital column of

the Income Statement. The fair value is calculated

by a broker using models with inputs from market

prices. On disposal or expiration, realised gains and

losses are also recognised in the income statement

as capital items.

Cash and Cash Equivalents

For the purposes of the Balance Sheet, cash

comprises cash in hand. Cash equivalents are short-

term, highly liquid investments that are readily

convertible to known amounts of cash and which are

subject to insignificant risk of changes in value.

For the purpose of the Statement of Cash Flows,

cash and cash equivalents consist of cash and cash

equivalents as defined above.

Annual Report 2024 | Miton UK MicroCap Trust plc | 63

Trade and Other Receivables

Trade and other receivables are measured, where

applicable, at amortised cost and as reduced by

appropriate allowance for expected irrecoverable

amounts.

Trade Payables and Short-term Borrowings

Trade payables and short-term borrowings are

measured at amortised costs.

Income

Dividends receivable on quoted equity shares are

taken to revenue on an ex-dividend basis. Dividends

receivable on equity shares where no ex-dividend

date is quoted are brought into account when the

Company’s right to receive payment is established.

Fixed returns on non-equity shares are recognised

on a time-apportioned basis.

Dividends from overseas companies are shown gross

of any non-recoverable withholding taxes, which are

presented separately in the Income Statement.

Special dividends are taken to revenue or capital

account depending on their nature.

When the Company has elected to receive scrip

dividends in the form of additional shares rather

than in cash, the amount of the cash dividend

forgone is recognised as income. Any excess in

the value of the cash dividend is recognised in the

capital column.

All other income is allocated on a time-apportioned

accruals basis.

Expenses and Finance Costs

All expenses and finance costs are accounted for

on an accruals basis. On the basis of the Board’s

expected long-term split of total returns the Company

charges 75% (2023: 75%) of its management fee and

100% (2023: 100%) of finance costs to capital.

Expenses incurred directly in relation to arranging

debt finance are amortised over the term of the

finance. Finance charges incurred and amortised are

charged to capital (2023: 100%) and included in the

capital column of the Income Statement. Expenses

incurred directly in relation to issuance of shares are

charged to share premium.

Expenses incurred in the maintenance of capital,

redemption and cancellation of shares are charged

to the special reserve through the Statement of

Changes in Equity.

Taxation

Deferred tax is provided using the liability method on

temporary differences between the tax bases of assets

and liabilities and their carrying amounts for financial

reporting purposes at the reporting date based on tax

rates that are expected to apply in the period when

the liability is settled or the asset is realised. Deferred

tax assets are only recognised if it is considered more

likely than not that there will be suitable profits from

which the future reversal of temporary differences

can be deducted. In line with the recommendations

of the AIC SORP, the allocation method used to

calculate the tax relief on expenses charged to capital

is the “marginal” basis. Under this basis, if taxable

income is capable of being offset entirely by expenses

charged through the revenue account, then no tax

relief is transferred to the capital account.

The charge for taxation is based on the net revenue

for the year and takes into account taxation deferred

or accelerated because of temporary differences

between the treatment of certain items for

accounting and taxation purposes. The actual charge

for taxation in the Income Statement relates to

irrecoverable withholding tax on overseas dividends

received during the year.

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

64 | Miton UK MicroCap Trust plc | Annual Report 2024

Notes to the Financial Statements continued

Dividends Payable to Shareholders

Dividends to shareholders are recognised as a

liability in the period in which they are paid or

approved in general meetings and are taken to the

Statement of Changes in Equity. Dividends declared

and approved by the Company after the Balance

Sheet date have not been recognised as a liability of

the Company at the Balance Sheet date.

Share Capital

The Company is a closed-ended investment

company with an unlimited life. As defined in the

Articles of Association, redemption of Ordinary

Shares is at the sole discretion of the Directors,

therefore the Ordinary Shares have been classified as

equity.

The issuance, acquisition and resale of Ordinary

Shares are accounted for as equity transactions

and no gain or loss is recognised in the Income

Statement. This is a reserve forming part of the non-

distributable reserves.

Share Premium

The share premium account represents the

accumulated premium paid for shares issued in

previous periods above their nominal value less issue

expenses. This is a reserve forming part of the non-

distributable reserves. The following items are taken

to this reserve:

•

Costs associated with the issue of shares; and

•

Premium on the issue of shares.

Special reserve

The special reserve was created by the cancellation

of the share premium account and is distributable.

This reserve may be used for:

•

Redemption of shares by way of the annual

redemption facility;

•

Costs relating to the capital structure of the

Company;

•

Cancellation of shares; and

•

Share buy backs and dividends.

Capital Reserve

The following are taken to the capital reserve

through the capital column in the statement of

comprehensive income:

•

Gains and losses on the disposal of investments

and derivatives;

•

Increase and decrease in the valuation of

investments held at the year end;

•

Exchange differences of a capital nature; and

•

Expenses, together with the related taxation

effect, allocated to this reserve in accordance with

the above accounting policies.

Capital Redemption Reserve

The capital redemption reserve represents non-

distributable reserves that arise from the purchase

and cancellation of shares.

Revenue Reserve

The revenue reserve represents the surplus of

accumulated profits and is distributable by the way

of dividends.

Annual Report 2024 | Miton UK MicroCap Trust plc | 65

2. Income

Year ended

30 April

2024

£000

Year ended

30 April

2023

£000

Income from investments:

UK Dividends 412 490

Non-UK dividend income 199 281

UK REIT dividends 29 33

640 804

Other income:

Bank deposit interest 214 66

Exchange gains — 2

Other income 1 3

Total 855 875

3. Return per Ordinary Share

Returns per Ordinary Share are based on the weighted average number of shares in issue during the year.

Basic and diluted return per share are the same as there are no dilutive elements on share capital.

Year ended

30 April 2024

Year ended

30 April 2023

Net proﬁt (£000) Revenue Capital Total Revenue Capital Total

Continuation shareholders (£000) 69 (2,993) (2,924) 54 (27,365) (27,311)

Redemption shareholders (£000) 5 (4,957) (4,952) (22) (739) (761)

74 (7,950) (7,876) 32 (28,104) (28,072)

Weighted average number of shares

in issue

85,902,417 97,041,026

Return per share (pence) 0.09 (9.26) (9.17) 0.03 (28.96) (28.93)

During the prior year the allocation of the return per Ordinary Share is allocated as follows:

Return per Ordinary Share

pence pence pence Weighted average

Continuation shareholders 0.08 (3.48) (3.40) 85,902,417

Redemption shareholders 0.01 (5.77) (5.76) 17,714,958

The 50,000 Management shares do not participate in the returns of the Company.

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

66 | Miton UK MicroCap Trust plc | Annual Report 2024

Notes to the Financial Statements continued

4. Share Capital

Year ended

30 April 2024

Year ended

30 April 2023

Number £000 £000 £000

Ordinary Shares of £0.001 each

Opening balance 94,638,561 95 109,253,560 110

Redemptions (17,714,958) (18) (14,614,999) (15)

76,923,603 77 94,638,561 95

Year ended

30 April 2024

Year ended

30 April 2023

Number £000 Number £000

Management shares of £1 each 50,000 50 50,000 50

The rights attached to each share class are set out on page 81 of this report.

Shares Issued

There were no shares issued during the year (2023: no shares were issued during the year).

Redemption of Ordinary Shares

The Company has a redemption facility through which shareholders are entitled to request the redemption

of all or part of their holding of Ordinary Shares on an annual basis. As set out in the Articles of Association, the

Board may, at its absolute discretion, elect not to operate the annual redemption facility in whole or in part. It

is anticipated that the next redemption point for shareholders will be in November 2024. The Board retains the

discretion to further amend this timetable. Accordingly, the Ordinary Shares have been classified as equity.

2023 Redemption

The total number of Ordinary Shares in respect of which valid redemption requests were received for the

2 November 2023 Redemption Point was 17,714,958 Ordinary Shares (representing 18.7185% of the issued

share capital (the “Redemption”)). The Board resolved to effect the Redemption using the redemption pool

method set out in the Company’s Articles, pursuant to which the Company notionally divided its assets and

liabilities into two pools, the Redemption Pool and the Continuing Pool, with the returns attributable to

the respective Redemption and Continuing shareholders. The 17,714,958 Ordinary Shares over which valid

redemption requests were made have been cancelled with effect from 2 November 2023; former holders of

the Redemption Shares are now creditors of the Company.

The assets of the Redemption Pool have been realised. The Redemption Price per Ordinary Share equals the

aggregate cash received by the Company upon the realisation of the Redemption Pool, after deducting the

costs of the redemption, and a pro-rata share of the costs and expenses of the Company not attributable

to a particular pool, divided by the number of Redemption Shares. On that basis, the Redemption Price for

the 2 November 2023 Redemption Point is 53.28 pence per redeemed Ordinary Share with a total payment

of £9,439,000. The capital losses and expenses associated with the operation of the Redemption Pool (the

“redemption loss”) are a component of the Return of the Company as stated in the Income Statement. The

Redemption shareholders received the value of the Redemption Pool upon liquidation. The redemption loss

to Redemption shareholders from the performance of the Redemption Pool amounted to £4,952,000.

Annual Report 2024 | Miton UK MicroCap Trust plc | 67

Management Shares

50,000 Management shares with a nominal value of £1 each were allotted to Miton Trust Managers Limited

on the date of incorporation. These shares have been fully paid up. The Management shares are non-voting

and non-redeemable and, upon a winding-up or on a return of capital of the Company, shall only receive the

fixed amount of capital paid up on such shares and shall confer no right to any surplus capital or assets of

theCompany.

5. Net Asset Values

The NAVs per Ordinary Share and the net assets attributable at the year end were as follows:

Year ended

30 April 2024

Year ended

30 April 2023

NAV per

pence

Net assets

attributable

£000

NAV per

pence

Net assets

attributable

£000

Basic and diluted 56.29 43,297 64.20 60,754

NAV per Ordinary Share is based on net assets at the year end and 76,923,603 Ordinary Shares (2023:

94,638,561), being the number of Ordinary Shares in issue at the year end.

NAV of £1.00 per Management share is based on net assets at the year end of £50,000 (2023: £50,000) and

attributable to 50,000 Management shares at the year end. The shareholders have no right to any surplus

capital or assets of the Company.

6. Management Fee

The basic management fee payable to the AIFM is calculated at the rate of one-twelfth of 0.9% (2023:

0.9%) of the average market capitalisation of the Company up to £100m, 0.8% per annum on the average

market capitalisation above £100m (2023: 0.8%), on the last business day of each calendar month. The

basic management fee accrues daily and is payable in arrears in respect of each calendar month. For the

purpose of calculating the basic fee, the ‘adjusted market capitalisation’ of the Company is defined as the

average daily midmarket price for an Ordinary Share and C share (when in issue), multiplied by the number

of relevant shares in issue, excluding those held by the Company in treasury, on the last business day of the

relevantmonth.

In addition to the basic management fee, and when the Redemption Pool is in existence, the AIFM is entitled

to receive from the Company a fee calculated at the rate of 0.9% (1% prior to 1 September 2020) of the net

asset value of the Redemption Pool on the last Business Day of the relevant calendar month.

The AIFM has agreed that, for so long as it remains the Company’s Investment Manager, it will not charge

such part of any management fee payable to it so that the Company can maintain an ongoing charges ratio

of 2% or lower. The ongoing charges ratio for the year is 1.99% (2023: 1.72%) for the Ordinary Shares, and as

such is below 2%. In accordance with the Directors’ policy on the allocation of expenses between income and

capital, in each financial year 75% of the management fee payable is expected to be charged to capital and

the remaining 25% to income.

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

68 | Miton UK MicroCap Trust plc | Annual Report 2024

Notes to the Financial Statements continued

6. Management Fee continued

Year ended

30 April 2024

Year ended

30 April 2023

Revenue

£000

Capital

£000

Total

£000

Revenue

£000

Capital

£000

Total

£000

Basic and diluted 97 295 392 149 448 597

At 30 April 2024, an amount of £63,000 (2023: £41,000) was outstanding and due to Premier Portfolio

Managers Limited in respect of management fees.

7. Other Expenses

Year ended

30 April

2024

£000

Year ended

30 April

2023

£000

Directors’ fees 126 127

Audit remuneration 59 56

Secretarial services 83 69

Administrator services 141 136

Registrar’s fees 18 17

Custodian fees 13 19

Depository fees 13 18

Advisory and professional fees 104 115

Printing and postage 6 10

Research fee

12 11

Directors’ insurance 9 15

Other expenses 13 14

Irrecoverable VAT 58 56

Miscellaneous 17 13

Total 672 676

Contribution to Investment Manager’s research budget

During the years ended 30 April 2024 and 30 April 2023, the Auditor’s remuneration related to audit

servicesonly.

8. Finance Costs

Year ended

30 April 2024

Year ended

30 April 2023

Revenue

£000

Capital

£000

Total

£000

Revenue

£000

Capital

£000

Total

£000

Revolving credit facility

£5m revolving loan facility arrangement fee — 5 5 — 6 6

£5m revolving loan facility non-utilisation fee — 16 16 — 33 33

— 21 21 — 39 39

Annual Report 2024 | Miton UK MicroCap Trust plc | 69

Revolving credit facility

The Company entered into a revolving credit facility (the “facility”) on 25 February 2021 for £5m arranged by

NatWest Markets Plc (previously known as The Royal Bank of Scotland plc), and the lender The Royal Bank of

Scotland International Limited, London branch.

The Company cancelled the facility on 23 October 2023 without penalty. No amounts had been drawn on the

facility. A commitment fee of 0.65% on undrawn balances was chargeable.

9. Taxation

a) Analysis of tax charge in the year:

Year to

30 April 2024

Year to

30 April 2023

Revenue

£000

Capital

£000

Total

£000

Revenue

£000

Capital

£000

Total

£000

UK corporation tax — — — — — —

Overseas tax not recoverable* 12 — 12 18 — 18

12 — 12 18 — 18

* Tax deducted on payment of overseas dividends by local tax authorities.

b) The tax assessed for the year is the standard rate of corporation tax in the United Kingdom aggregated

for the ﬁnancial year of 25.0% (2023: 19.5%). The differences are explained below:

Year to

30 April 2024

Year to

30 April 2023

Revenue

£000

Capital

£000

Total

£000

Revenue

£000

Capital

£000

Total

£000

Net return before taxation 86 (7,950) (7,864) 50 (28,104) (28,054)

Theoretical tax at UK corporation tax rate of

25.0% (2023: 19.5%)

22 (1,988) (1,966) 10 (5,480) (5,470)

Effects of:

UK dividends that are not taxable (103) — (103) (96) – (96)

Overseas dividends that are not taxable (50) — (50) (55) – (55)

Non-taxable investment losses — 1,906 1,906 – 5,385 5,385

Overseas taxation suffered 12 — 12 18 – 18

Unrelieved excess expenses 131 82 213 141 95 236

Actual current tax charge 12 — 12 18 — 18

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

70 | Miton UK MicroCap Trust plc | Annual Report 2024

9. Taxation continued

Factors that may affect future tax charges

As at 30 April 2024, based on current estimates and including the accumulation of net allowable losses, the

Company had unrelieved losses of £11,488,758 (2023: £10,648,712) that are available to offset future taxable

revenue. A deferred tax asset of £2,872,190 (2023: £2,662,178), based on the effective tax rate of 25%, has not

been recognised because the Company is not expected to generate sufficient taxable income in future

periods in excess of the available deductible expenses and accordingly, the Company is unlikely to be able to

reduce future tax liabilities through the use of existing surplus losses.

10. Dividends

30 April 2024 30 April 2023

Amounts recognised as distributions to equity holders in the year. £000 pence £000 pence

In respect of the previous year:

Final dividend 142 0.15 142 0.15

142 0.15 142 0.15

The Directors have recommended a final dividend in respect of the year ended 30 April 2024 of 0.09p (2023:

0.15p) per Ordinary Share payable on 25 October 2024 to all shareholders on the register at close of business

on 27 September 2024. The ex-dividend date will be 26 September 2024.

11. Investments

30 April

2024

£000

30 April

2023

£000

Investment portfolio summary:

Opening book cost 75,539 91,876

Opening unrealised (losses)/gains (19,471) 2,946

Analysis of transactions made in the year

Opening fair value 56,068 94,822

Movements in the year:

Purchases at cost 16,336 15,532

Sales – proceeds (23,840) (27,521)

Movement in investment holding losses (7,272) (26,765)

Closing fair value 41,292 56,068

Closing book cost 60,283 75,539

Closing unrealised losses (18,991) (19,471)

Closing fair value 41,292 56,068

Transaction costs:

Costs on acquisitions 15 10

Costs on disposals 22 30

37 40

Notes to the Financial Statements continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 71

The Company received £23,840,000 (2023: £27,521,000) from investments sold in the year. The book cost of

these investments when they were purchased was £31,592,000 (2023: £31,869,000). These investments have

been revalued over time and until they were sold any unrealised gains or losses were included in the fair value

of the investments.

A list of the largest portfolio holdings by their fair value is shown on page 17.

12. Fair Value Hierarchy

Financial assets of the Company are carried in the Balance Sheet at their fair value or approximation of

fair value. The fair value is the amount at which the asset could be sold in an ordinary transaction between

market participants, at the measurement date, other than a forced or liquidation sale. The Company

measures fair values using the following hierarchy that reflects the significance of the inputs used in making

the measurements.

Categorisation within the hierarchy has been determined on the basis of the lowest level input that is

significant to the fair value measurement of the relevant asset as follows:

Level 1 – valued using quoted prices, unadjusted in active markets for identical assets and liabilities

Level 2

– valued by reference to valuation techniques using observable inputs for the asset or liability other

than quoted prices included in level 1

Level 3

– valued by reference to valuation techniques using inputs that are not based on observable market

data for the asset or liability

Assessing the significance of a particular input requires judgement, considering factors specific to the asset or

liability. Financial assets are transferred at the point in which a change of circumstances occur.

The table below sets out the fair value measurement of financial assets and liabilities in accordance with the

fair value hierarchy.

Level 1

£000

Level 2

£000

Level 3

£000

Total

£000

Financial assets at fair value through proﬁt or loss at 30 April 2024

Equity investments 40,911 — 381 41,292

Derivative contracts — 2 — 2

40,911 2 381 41,294

Level 1

£000

Level 2

£000

Level 3

£000

Total

£000

Financial assets at fair value through proﬁt or loss at 30 April 2023

Equity investments 55,801 128 139 56,068

Derivative contracts — 169 — 169

55,801 297 139 56,237

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

72 | Miton UK MicroCap Trust plc | Annual Report 2024

12. Fair Value Hierarchy continued

The Level 2 investments are at values calculated using observable inputs. The fair value of warrants is

determined by the Manager through use of models using available observable inputs of the warrant: the

exercise share price of the investee company, the expiration period plus other factors including the prevailing

interest rate and associated risks.

Fair value of level 3 movements – ﬁnancial assets

As at

30 April

2024

Level 3

£000

As at

30 April

2023

Level 3

£000

Opening fair value investments 139 479

Transfer from Level 1 to Level 3 90 58

Transfer from Level 2 to Level 3 — 86

Transfer from Level 3 to Level 1 (94) (557)

Movement in unrealised 246 73

Closing fair value of Level 3 investments 381 139

Investments classified within Level 3 consist of equities, warrants and options. As observable prices are

not available for these investments, the Manager has used valuation techniques to derive the fair value.

The Level3 valuations are reviewed on a regular basis by the Manager. The Manager considers the

appropriateness of the valuation model inputs, as well as the valuation result using various valuation methods

and techniques generally recognised as standard. In selecting the most appropriate valuation model the

Manager performs back testing and considers which model’s results have historically aligned most closely to

actual market transactions. The fair value of Level 3 investments is based on discounted anticipated future

cash returns, taking account of available information, the consideration of liquidity, credit and market risk

factors, and adjusts the valuation model as deemed necessary.

The transfers between Level 3 and Level 1 consist of equities that have been suspended and/or readmitted

after suspension on the relevant stock exchange. Where the stock is readmitted, it is fair valued using quoted

prices, unadjusted in an active market and transferred to Level 1. Where it is suspended, it is transferred to

Level 3 with the appropriate valuation technique applied with consideration of the rationale for suspension

and other relevant information.

Other Financial Assets and Liabilities

For all other financial assets and liabilities, the carrying value is an approximation of fair value, including: trade

and other receivables; cash and cash equivalents and trade and other payables.

Notes to the Financial Statements continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 73

13. Derivative Contracts

Listed Put Options at fair value through proﬁt or loss at 30 April 2024

As at

30 April

2024

£000

As at

30 April

2023

£000

Opening book cost 911 2,070

Opening option holding losses (742) (1,269)

Total options designated at fair value 169 801

Listed Put Options at fair value through proﬁt or loss at 30 April 2024

30 April

2024

£000

30 April

2023

£000

Analysis of option movements

Opening fair value 169 801

Movements in the period:

Purchases at cost 195 911

Sales – proceeds (11) (691)

Movement in holding losses (351) (852)

Closing fair value 2 169

Closing book cost 158 911

Closing unrealised losses (156) (742)

Closing fair value 2 169

Year ended

30 April

2024

£000

Year ended

30 April

2023

£000

Transaction costs:

Costs on acquisitions 1 1

Costs on disposals — 2

1 3

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

74 | Miton UK MicroCap Trust plc | Annual Report 2024

13. Derivative Contracts continued

Derivative contracts serve as components of the Company’s investment strategy and are utilised primarily to

structure and hedge investments to enhance performance and reduce risk of the Company (the Company

does not designate any derivative as hedging instrument for hedge accounting purposes). The derivative

contracts that the Company may hold from time to time or issue include: index-linked notes, contracts for

differences, covered options and other equity-related instruments.

The Company’s investment objective set limits on investments in derivatives. The Investment Manager

closely monitors the Company’s exposure under derivative contracts and any use of derivatives for

investment purposes will be made on the basis of the same principles of risk spreading and diversification

that apply to the Company’s direct investments. The Company will not enter into uncovered short positions.

14. Trade and Other Receivables

30 April

2024

£000

30 April

2023

£000

Amount due from brokers — 117

Dividends receivable 42 48

Prepayment and other debtors 30 50

Taxation recoverable 5 2

77 217

15. Trade and Other Payables

30 April

2024

£000

30 April

2023

£000

Amount due to brokers — 128

Other creditors 173 162

173 290

Notes to the Financial Statements continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 75

16. Capital Management Policies

The Company’s capital management objectives are:

•

To ensure that it will be able to continue as a going concern; and

•

To maximise the income and capital return over the long term to its equity shareholders through an

appropriate balance of equity capital and debt.

As stated in the investment policy, the Company has authority to borrow up to 15% of net asset value through

a mixture of bank facilities and certain derivative instruments. There were no borrowings as at 30 April 2024

or throughout the year (2023: nil). Also, as a public company, the minimum share capital is £50,000.

The Company’s capital at 30 April 2024 comprised:

30 April

2024

£000

30 April

2023

£000

Current liabilities:

Trade and other payables 173 290

Equity:

Equity share capital 127 145

Retained earnings and other reserves 43,170 60,609

Total shareholders’ funds 43,297 60,754

Debt as a % of net assets 0.00% 0.00%

The Board, with the assistance of the Investment Manager, monitors and reviews the broad structure of the

Company’s capital on an ongoing basis. This review includes:

•

the planned level of gearing, which takes into account the Investment Manager’s view of the market;

•

the buy back of shares for cancellations or treasury, which takes account of the difference between the

NAV per share and the share price (i.e the level of share price discount or premium);

•

new issues of equity shares; and

•

the extent to which revenue in excess of that which is required to be distributed should be retained.

The Company’s objectives, policies and processes for managing capital have remained unchanged since

itslaunch.

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

76 | Miton UK MicroCap Trust plc | Annual Report 2024

17. Reserves

Ordinary Shares to 30 April 2024

Capital

redemption

reserve

£000

premium

account

£000

Special

reserve*

£000

Capital

reserve

realised*

£000

Capital

reserve

unrealised*

£000

Revenue

reserve*

£000

Opening balance 79 672 51,039 28,907 (20,210) 122

Redemption of Ordinary Shares — — (9,439) — — —

Cancellation of shares 18 — — — — —

Net loss on realisation of investments and derivatives — — — (8,700) — —

Unrealised gain realised in the year — — — — 1,066 —

Management fee charged to capital — — — (295) — —

Finance costs charged to capital — — — (21) — —

Equity dividends paid — — (20) — — (122)

Revenue return on ordinary activities after tax — — — — — 74

Closing balance 97 672 41,580 19,891 (19,144) 74

* At 30 April 2024, the distributable reserves of the Company comprised of £42,022,000 (2023: £59,858,000).

Ordinary Shares to 30 April 2023

Capital

redemption

reserve

£000

premium

account

£000

Special

reserve*

£000

Capital

reserve

realised*

£000

Capital

reserve

unrealised*

£000

Revenue

reserve*

£000

Opening balance 64 672 61,546 35,121 1,680 232

Redemption of Ordinary Shares — — (10,507) — — —

Cancellation of shares 15 —

— — — —

Net loss on realisation of investments and derivatives — — — (5,727) — —

Unrealised losses realised in the year — — — — (21,890) —

Management fee charged to capital — — — (448) — —

Finance costs charged to capital — — — (39) — —

Equity dividends paid — — — — — (142)

Revenue return on ordinary activities after tax — — — — — 32

Closing balance 79 672 51,039 28,907 (20,210) 122

Notes to the Financial Statements continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 77

18. Analysis of Financial Assets and Liabilities

Investment Objective and Policy

The Company’s investment objective and policy are detailed on pages 81 and 82.

The Company’s financial instruments can comprise:

•

Shares and debt securities held in accordance with the Company’s investment objective and policies;

•

Derivative instruments for efficient portfolio management, gearing and investment purposes; and

•

Cash, liquid resources and short-term debtors and creditors that arise from its operations.

The risks identified arising from the Company’s financial instruments are market risk (which comprises

market price risk, interest rate risk and foreign currency exposure risk), liquidity risk and credit and

counterparty risk. The Company may enter into derivative contracts to manage risk. The Board reviews and

agrees on policies for managing each of these risks, which are summarised below.

These policies have remained unchanged since the beginning of the accounting period.

Market Risk

Market risk arises mainly from uncertainty about future prices of financial instruments used in the

Company’s business. It represents the potential loss the Company might suffer through holding market

positions by way of price movements, interest rate movements and exchange rate movements. The

Investment Manager assesses the exposure to market risk when making each investment decision and these

risks are monitored by the Investment Manager on a regular basis and the Board at quarterly meetings with

the InvestmentManager.

Market price risk

Market price risk (i.e. changes in market prices other than those arising from currency risk or interest rate risk)

may affect the value of investments.

The Board manages the risks inherent in the investment portfolio by ensuring full and timely reporting of

relevant information from the Investment Manager. Investment performance and exposure are reviewed at

each Board meeting.

The Company’s exposure to changes in market prices as at 30 April 2024 on its equity and listed Put index

option investments held at fair value through profit or loss was £41,294,000 (30 April 2023: £56,237,000).

The portfolio is managed with an awareness of the effects of adverse price movements through detailed and

continuing analysis with the objective of maximising overall returns to Shareholders. If the fair value of the

Company’s investments at the year end increased or decreased by 10%, then it would have had an impact on

the Company’s capital return through (losses)/gains on investments held at fair value, impacting profit/(loss)

and the NAV, by £4,129,000 (2023: £5,624,000).

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

78 | Miton UK MicroCap Trust plc | Annual Report 2024

18. Analysis of Financial Assets and Liabilities continued

Interest rate risk

Interest rate movements may affect the level of income receivable on cash deposits. The Company’s financial

assets and liabilities, excluding short-term debtors and creditors, may include investment in fixed interest

securities, such as UK corporate debt stock, whose fair value may be affected by movements in interest rates.

The majority of the Company’s financial assets and liabilities, however, are non-interest bearing. As a result,

the Company’s financial assets and liabilities are not subject to significant amounts of risk due to fluctuations

in the prevailing levels of market interest rates. There was no exposure to interest bearing liabilities during

the year ended 30 April 2024 (2023: nil).

The possible effects on the fair value and cash flows that could arise as a result of changes in interest rates

are taken into account when making investment decisions. The Board imposes borrowing limits to ensure

gearing levels are appropriate to market conditions.

The interest rate profile of the Company (excluding short-term debtors and creditors) was as follows:

30 April

2024

Floating rate

£000

30 April

2023

Floating rate

£000

Assets and liabilities:

Cash and cash equivalents 2,099 4,590

2,099 4,590

If the above level of cash was maintained for a year, a 1% increase in interest rates would increase the revenue

return and net assets by £21,000 (2023: £46,000). If there was a fall of 1% in interest rates, it would potentially

impact the Company by reducing interest and turning positive interest to negative interest. The total effect

would be a revenue reduction/cost increase and decrease in net assets of £21,000 (2023: £46,000).

Foreign currency risk

Although the Company’s performance is measured in Sterling, a proportion of the Company’s assets may be

either denominated in other currencies or in investments with currency exposure. Any income denominated

in a foreign currency is converted into Sterling upon receipt. At the Balance Sheet date, all the Company’s

assets were denominated in Sterling and accordingly the only currency exposure the Company has is through

the trading activities of its investee companies.

Liquidity Risk

The Company’s liquidity risk is managed on a daily basis by the Investment Manager in accordance with

established policies and procedures in place. The Investment Manager reviews daily forward-looking cash

reports which project cash obligations. These reports allow it to manage its obligations. A maturity analysis is

not presented as the Investment Manager does not consider this to be a material risk.

Notes to the Financial Statements continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 79

Credit and Counterparty Risk

Credit risk is the risk of financial loss to the Company if the contractual party to a financial instrument fails to

meet its contractual obligations.

The maximum exposure to credit risk as at 30 April 2024 was £2,178,000 (2023: £4,976,000). The calculation is

based on the Company’s credit risk exposure as at 30 April 2024 and this may not be representative for the

whole year.

The Company’s quoted investments are held on its behalf by The Northern Trust (“NT”), acting as the

Company’s custodian. Bankruptcy or insolvency of the custodian may cause the Company’s rights with

respect to securities held by the custodian to be delayed. The Board monitors the Company’s risk by

reviewing the custodian’s internal controls report.

Where the Investment Manager makes an investment in a bond, corporate or otherwise, the credit rating of

the issuer is taken into account so as to minimise the risk to the Company of default.

The Company’s cash balances are held on its behalf by NT. The Board monitor the credit worthiness of NT,

currently rated at AA- (Standard & Poors), Aa2 (Moody’s and AA (Fitch Ratings) for Long Term Deposit/Debt.

The exposure of cash held at Northern Trust as at 30 April 2024 was £2,099,000 (2023: £4,590,00). The cash

balances will fluctuate throughout the year and the Board will monitor theexposure.

Investment transactions are carried out with a 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.

Cash is only held at banks that have been identified by the Board as reputable and of high credit quality.

None of the Company’s assets are past due or impaired.

19. Related Parties

Fees paid to the Company’s Directors are disclosed in the Report on Directors Remuneration on page 45. At

the year end, £nil was outstanding due to Directors (2023: £nil).

Details of the Management fee payable to Premier Portfolio Managers Limited pursuant to the Investment

Management Agreement are set out in the Strategic Report on page 28. Amounts paid and payable are set

out in Note 6.

20. Post Balance Sheet Events

There were no Post Balance Sheet Events.

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Notes to the Financial Statements continued

80 | Miton UK MicroCap Trust plc | Annual Report 2024

Redemption of Ordinary Shares

The Company has a voluntary redemption facility

through which shareholders are entitled to request

the redemption of all or part of their holding of

Ordinary Shares on an annual basis. For the year

ended 30 April 2024 the Redemption Point for

Ordinary Shares will be in accordance with the

adjacent timetable.

Shareholders submitting valid requests for the

redemption of Ordinary Shares will have their

shares redeemed at the Redemption Price. The

Directors may elect, at their absolute discretion, to

calculate the Redemption Price applying on any

redemption point by reference to the Dealing Value

per Ordinary Share or by reference to a separate

RedemptionPool*.

The Board may, at its absolute discretion, elect not to

operate the annual redemption facility on any given

Redemption Point, or to decline in whole or part any

redemption request, although the Board does not

generally expect to exercise this discretion, save in

the interests of shareholders as a whole.

A redemption of Ordinary Shares may be subject

to either income tax and/or capital gains tax. In

particular, private shareholders that sell their shares

via the redemption mechanism could find they

are subject to income tax on the gains made on

the redeemed shares rather than the more usual

capital gains tax on the sale of their shares in the

market. However, individual circumstances do

vary, so shareholders who are in any doubt about

the redemption or the action that should be taken

should consult their stockbroker, accountant, tax

adviser or other independent financial adviser.

The relevant dates for the November 2024

Redemption Point are:

1 October 2024 Latest date for receipt

of redemption requests

and certificates for

certificated shares

3.00pm on

1 October 2024

Latest date and time for

receipt of redemption

requests and settled

TFE (Transfer to

Escrow) instructions for

uncertificated shares via

CREST

5.00pm on

5 November 2024

Redemption Point

By 5 November 2024 Company to notify

Redemption Price and

dispatch redemption

monies; or

If the redemption is

funded by way of a

Redemption Pool, the

Company will notify the

Redemption Price and

dispatch of redemption

monies as soon as

practicable.

Full details of the redemption facility are set out in

the Company’s Articles of Association or are available

from the Secretary.

* The pool of cash, assets and liabilities to be created by the Directors in respect

of a particular redemption point and allocated to the Ordinary Shares which

are the subject of redemption requests for that redemption point. The assets

of the Redemption Pool will be liquidated and the Redemption Price per

Ordinary Share will equal the aggregate cash received by the Company

upon the realisation of the Redemption Pool, after deducting the costs of

the redemption, which will be borne by the relevant pool, an adjustment for

any attributable unsettled liabilities and a pro-rata share of the costs and

expenses of the Company not attributable to a particular pool, divided by the

number of Redemption Shares, as set out in the Articles.

Annual Report 2024 | Miton UK MicroCap Trust plc | 81

Miton UK MicroCap Trust plc was incorporated on

26March 2015 and its Ordinary Shares were admitted

to the premium segment of the Official List and

to trading on the London Stock Exchange’s main

market for listed securities on 30 April 2015.

Capital Structure

At the year end, the Company’s share capital

consisted of Ordinary Shares of £0.001 each

(“Ordinary Shares”) and non-voting management

shares of £1 each (“Management shares”). From time

to time, the Company may issue C shares of £0.01

each (“C shares”).

The Company’s shares have the following rights:

Voting: Ordinary Shares and C shares have equal

voting rights. At shareholder meetings, members

present in person or by proxy have one vote on a

show of hands and on a poll have one vote for each

share held.

Management shares are non-voting unless no other

shares are in issue at that time.

Dividends: the assets of the Ordinary Shares and

C shares are separate and each class is entitled to

dividends declared on their respective asset pool.

The management shares are entitled to receive, in

priority to the holders of any other class of shares, a

fixed cumulative dividend equal to 0.01% per annum

on the nominal value.

Capital: if there are any C shares in issue, the

surplus capital and assets of the Company shall on

a winding-up or on a return of capital, be applied

amongst the existing Ordinary Shareholders and the

Management shareholders pro rata according to the

nominal capital paid up on their holdings, having

first deducted therefrom an amount equivalent to

the assets and liabilities relating to the C shares,

which amount shall be applied amongst the C

shareholders pro rata according to the nominal

capital paid up on their holdings of C shares.

When there are no C shares in issue, any surplus

shall be divided amongst the Ordinary Shareholders

and Management shareholders pro rata according

to the nominal capital paid up on their holdings of

Ordinary Shares and Management shares.

In each instance, the holders of the Management

shares shall only receive an amount up to the

capital paid up on such Management shares and

the Management shares shall not confer the right

to participate in any surplus remaining following

payment of such amount.

As at the date of this Report, there are 76,923,603

Ordinary Shares in issue, none of which are held in

treasury, and 50,000 Management shares.

The Company has a redemption facility through

which shareholders are entitled to request the

redemption of all or part of their holding of

Ordinary Shares on an annual basis. The Board

may, at its absolute discretion, elect not to operate

the annual redemption facility in whole or in part,

although it has indicated that it is minded to

approve all requests.

Details of the redemption facility are set out on

page 80.

Investment Objective

The investment objective of the Company is to

provide shareholders with capital growth over the

long-term.

Investment Policy

The Company invests primarily in the smallest

companies, measured by their market capitalisation,

quoted or traded on an exchange in the United

Kingdom at the time of investment. It is likely that

the majority of the microcap companies held in the

Company’s portfolio will be quoted on AIM and will

typically have a market capitalisation of less than

£150 million at the time of investment. The Company

may also invest in debt, warrants or convertible

instruments issued by such companies and may

invest in, or underwrite, future equity issues by

suchcompanies.

Shareholder Information

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

82 | Miton UK MicroCap Trust plc | Annual Report 2024

The Company may utilise derivative instruments

including index-linked notes, contracts for

differences, covered options and other equity

related derivative instruments for efficient portfolio

management, gearing and investment purposes.

Any use of derivatives for investment purposes

will be made on the basis of the same principles

of risk spreading and diversification that apply to

the Company’s direct investments, as described

below. The Company will not enter into uncovered

shortpositions.

If companies in the portfolio achieve organic

growth or grow through corporate activity such

as acquisitions, and consequently have a market

capitalisation that would place them outside the

investable universe, the Investment Manager will not

be obliged to sell those holdings, but the proportion

of the portfolio in such companies will be carefully

monitored by the Investment Manager and the

Board so that the overall investment policy to invest

in the smallest quoted or traded companies is not

materially altered.

The Company’s portfolio is expected to be diversified

by industry and market of activity. No single holding

will represent more than 15% of Gross Assets at

the time of investment and, when fully invested,

the portfolio is expected to have over 120 holding

although there is no guarantee that will be the case

and it may contain a lesser number of holdings at

any time.

The Company will have the flexibility to invest up

to 10% of its Gross Assets at the time of investment

in unquoted or untraded companies, or in any one

unquoted or untraded company.

The Company will invest no more than 10% of

Gross Assets at the time of investment in other

investment funds.

Borrowing

The Company may deploy borrowing to enhance

long-term capital growth. Gearing will be deployed

flexibly up to 15% of the Net Asset Value, at the time

of borrowing. In the event this limit is breached

as a result of market movements, and the Board

considers that borrowing should be reduced, the

Investment Manager shall be permitted to realise

investments in an orderly manner so as not to

prejudice shareholders.

No material change will be made to the investment

policy without the approval of shareholders by

ordinary resolution.

Share Dealing

Shares can be traded through a stockbroker or share

trading platform.

Share Prices

The Company’s shares are listed on the London

Stock Exchange.

Share Register Enquiries

The register for the Ordinary Shares is maintained

by Link Group. In the event of queries regarding

your holding, please contact the Registrar on

0371 664 0300. Calls are charged at the standard

geographic rate and will vary by provider. Calls

outside the United Kingdom will be charged at

the applicable international rate. Email Link at

enquiries@linkgroup.co.uk. Changes of name and/or

address must be notified in writing to the Registrar:

Link Group, The Registry, 10th Floor, Central Square,

29WellingtonStreet, Leeds LS1 4DL.

Current Share Capital and Net Asset Value

Information

Ordinary £0.001 shares: 76,923,603

SEDOL Number: BWFGQ08

ISIN Number: GB00BWFGQ085

The Company releases its net asset value per share to

the London Stock Exchange daily.

Shareholder Information continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 83

Annual and Half-Yearly Reports

Copies of the Annual and Half-Yearly Reports are

available from the Secretary on telephone number

0207 982 1073 and are available on the Company’s

website:

www.mitonukmicrocaptrust.com

Investment Manager: Premier Portfolio

ManagersLimited

The Company’s Investment Manager is Premier

Portfolio Managers Limited, a wholly-owned

subsidiary of Premier Miton Group plc (“Premier

Miton”). Premier Miton is quoted on the AIM market

for smaller and growing companies.

As at 31 March 2024, Premier Miton had total funds

under management of approximately £10.7 billion.

Members of the fund management team invest in

their own funds and are significant shareholders

in Premier Miton. Investor updates in the form

of monthly factsheets are available from the

Investment Manager’s website:

www.premiermiton.com

Association of Investment Companies

The Company is a member of the Association of

Investment Companies.

Financial Calendar

30 April 2024 Year end

July 2024 Announcement of 2024

annual results

24 September 2024 Annual General Meeting

31 October 2024 Half-year end

5 November 2024 Redemption Point

December 2024 Announcement of 2024

half-yearly results

30 April 2025 Year end

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

Retail Investors advised by IFAs

The Company currently conducts its affairs so

that the shares issued by the Company can be

recommended by IFAs to ordinary retail investors

in accordance with the Financial Conduct Authority

(“FCA”) rules in relation to non-mainstream

investment products and intends to continue to do

so for the foreseeable future. The shares are excluded

from the FCA’s restrictions which apply to non-

mainstream investment products because they are

shares in an investment trust.

84 | Miton UK MicroCap Trust plc | Annual Report 2024

Alternative Investment Fund Managers’ Directive

Disclosures

The provisions of the Alternative Investment Fund

Managers Directive (“AIFMD”) took effect on 22 July

2014. That legislation requires the AIFM to establish

and maintain remuneration policies for its staff

which are consistent with and promote sound and

effective risk management.

Pre-Investment Disclosures

The AIFM is required to make certain disclosures

available to investors in accordance with the AIFMD.

Those disclosures that are required to be made pre-

investment can be found at:

www.mitonukmicrocaptrust.com/documents.

AIFMD Leverage Limits

The maximum level of leverage which the

Investment Manager may employ on behalf of the

Company and the levels as at 30 April 2024 are set

out below. A figure of 100% means that the exposure

is equal to the net asset value and the AIF has no

leverage.

Leverage exposure

Maximum

gross

leverage

Maximum

commitment

Maximum level 200% 200%

Actual level 100% 100%

Remuneration Disclosure

Premier Portfolio Managers Limited (the ‘AIFM’) is

part of a larger group of companies within which

remuneration policies are the responsibility of a

Remuneration Committee comprised entirely

of non-executive Directors. That committee has

established a remuneration policy which sets out

a framework for determining the level of fixed

and variable remuneration of staff, including

maintaining an appropriate balance between

thetwo.

Arrangements for variable remuneration within the

group are calculated primarily by reference to the

performance of each individual and the profitability

of the relevant business unit. The policies are

designed to reward long-term performance and

long term profitability.

Within the group, all staff are employed by the

parent company with none employed directly by

the AIFM. The costs of a number of individuals are

allocated between the entities within the group

based on the expected amount of time devoted

toeach.

The total remuneration of those individuals who are

fully or partly involved in the activities of the AIFM in

relation to Alternative Investment Funds, including

the Company (“AIFs”), including those whose time

is allocated between group entities, for the financial

year ending 30 September 2023, is analysed below:

Fixed Remuneration £5,021,933

Variable Remuneration £2,298,473

Total £7,320,406

Weighted FTE Headcount 53

The table below provides an alternative analysis of

the remuneration data.

Aggregate remuneration of:

Signiﬁcant Inﬂuence Functions £2,588,863

Senior Management Functions £223,783

Other staff £4,507,759

Total £7,320,405

The staff members included in the above analysis

support all the funds managed by the AIFM. It is

not considered feasible or useful to attempt to

apportion these figures to individual AIFs.

The AIFM’s management has reviewed the general

principles of the remuneration policy and its

application in the last year which has resulted in no

material changes to the policy.

Alternative Investment Fund Managers’

Directive Disclosures

Annual Report 2024 | Miton UK MicroCap Trust plc | 85

NOTICE IS HEREBY GIVEN that the ninth ANNUAL GENERAL MEETING of Miton UK MicroCap Trust plc

(the “Company”) will be held on 24 September 2024 at 11.30am at the offices of Stephenson Harwood LLP,

1Finsbury Circus, London EC2M 7SH to consider and vote on the Resolutions below.

Resolutions 1 to 10 (inclusive) will be proposed as Ordinary Resolutions and Resolutions 11 to 13 (inclusive) will

be proposed as Special Resolutions.

Ordinary Resolutions

1. To receive and adopt the Strategic Report, Reports of the Directors and Auditor and the audited

financial statements for the year ended 30 April 2024.

2. To receive and approve the Directors’ Remuneration Report for the year ended 30 April 2024.

3. To re-elect Louise Bonham as a Director of the Company.

4. To re-elect Peter Dicks as a Director of the Company.

5. To re-elect Davina Walter as a Director of the Company.

6. To re-elect Ashe Windham as a Director of the Company.

7. To re-appoint BDO LLP as Auditor of the Company to hold office from the conclusion of the meeting

until the conclusion of the next meeting at which financial statements are laid before the Company.

8. To authorise the Audit Committee to determine the remuneration of the Auditor of the Company.

9. To declare a final dividend of 0.09p pence per Ordinary Share for the year ended 30 April 2024.

10. THAT: The Directors be and are hereby generally and unconditionally authorised in accordance with

Section 551 of the Companies Act 2006 (“the Act”) to exercise all the powers of the Company to allot

Ordinary Shares in the capital of the Company up to an aggregate nominal value of £7,692 (being

approximately 10% of the issued Ordinary Share capital of the Company at the date of this Notice), such

authority to expire at the conclusion of the Annual General Meeting of the Company to be held in 2025

(unless previously renewed, varied or revoked by the Company in general meeting) (the “Section 551

period”), but so that the Company may, at any time prior to the expiry of the Section 551 period, make

offers or agreements which would or might require the allotment of shares in pursuance of such offers

or agreements as if the authority had not expired.

Notice of Annual General Meeting

The

Company

Strategic

Report Governance

Company

Accounts

Shareholder

Information

86 | Miton UK MicroCap Trust plc | Annual Report 2024

Notice of Annual General Meeting continued

Special Resolutions

11. THAT: Subject to the passing of Resolution 10, the Directors be and they are hereby empowered,

in accordance with Sections 570 and 573 of the Act, to allot Ordinary Shares and to sell Ordinary

Shares from treasury for cash pursuant to the authority referred to in Resolution 10 as if

Section 561(1) of the Act did not apply to any such allotment or sale, such power to expire at the

conclusion of the Annual General Meeting of the Company to be held in 2025 (unless previously

renewed, varied or revoked by the Company in general meeting) save that the Company may,

at any time prior to the expiry of such power, make an offer or enter into an agreement which

would or might require Ordinary Shares to be allotted or sold from treasury equity securities in

pursuance of such an offer or agreement as if such power had not expired.

12. THAT: The Company is hereby generally and unconditionally authorised in accordance with

Section 701 of the Act to make market purchases (within the meaning of Section 693(4) of

the Act) of Ordinary Shares of £0.001 each in the capital of the Company (“Ordinary Shares”)

providedthat:

(i) the maximum number of Ordinary Shares hereby authorised to be purchased is 11,530,848

(representing 14.99% of the Ordinary Shares in issue at the date of this Notice);

(ii) the minimum price which may be paid for each Ordinary Share is £0.001;

(iii) the maximum price which may be paid for each Ordinary Share shall not be more than the

higher of: (i) an amount equal to 105% of the average of the middle market quotations of Ordinary

Shares taken from the Daily Official List of the London Stock Exchange for the five business days

immediately preceding the day on which the contract of purchase is made; and (ii) the higher

of the price of the last independent trade in the Ordinary Shares and the highest then current

independent bid for the Ordinary Shares on the London Stock Exchange;

(iv) this authority will (unless previously renewed, varied or revoked by the Company in general

meeting) expire at the conclusion of the Annual General Meeting of the Company to be held

in2025;

(v) the Company may make a contract of purchase for Ordinary Shares under this authority before

this authority expires which will or may be executed wholly or partly after its expiration; and

(vi) any Ordinary Shares bought back under the authority hereby granted may, at the discretion of

the Directors, be cancelled or held in treasury and if held in treasury may be resold from treasury

or cancelled at the discretion of the Directors.

13. THAT: A general meeting other than an annual general meeting may be called on not less than

14clear days’ notice.

By order of the Board

Northern Trust Secretarial Services (UK) Limited

Registered Office: 50 Bank Street, London E14 5NT

11 July 2024

Annual Report 2024 | Miton UK MicroCap Trust plc | 87

Administrative Notes in Connection with the Annual General Meeting

1. Attending the Annual General Meeting in person

If you wish to attend the Annual General Meeting in person, you should arrive at the venue for the

Annual General Meeting in good time to allow your attendance to be registered. It is advisable to have

some form of identification with you as you may be asked to provide evidence of your identity to the

Company’s registrar, Link Group (the “Registrar”), prior to being admitted to the Annual General Meeting.

2. Appointment of proxies

Members are entitled to appoint one or more proxies to exercise all or any of their rights to attend,

speak and vote at the Annual General Meeting. A proxy need not be a member of the Company but

must attend the Annual General Meeting to represent a member. To be validly appointed, a proxy

must be appointed using the procedures set out in these notes. If members wish their proxy to speak

on their behalf at the meeting, members will need to appoint their own choice of proxy (not the

Chairman of the Annual General Meeting) and give their instructions directly to them.

Members can only appoint more than one proxy where each proxy is appointed to exercise rights

attached to different shares. Members cannot appoint more than one proxy to exercise the rights

attached to the same share(s). If a member wishes to appoint more than one proxy, they should

log on to https://investorcentre.linkgroup.co.uk/Login/Login or contact the Registrar by email at

shareholderenquiries@linkgroup.co.uk or by telephone on 0371 664 0300. Calls are charged at the

standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged

at the applicable international rate. Lines are open between 09:00 – 17:30, Monday to Friday excluding

public holidays in England and Wales.

A member may instruct their proxy to abstain from voting on any resolution to be considered at the

Annual General Meeting by marking the ‘Vote Withheld’ option when appointing their proxy. It should

be noted that a vote withheld is not a vote in law and will not be counted in the calculation of the

proportion of votes ‘For’ or ‘Against’ the resolution.

The appointment of a proxy will not prevent a member from attending the Annual General Meeting

and voting in person if they wish. A member present in person or by proxy shall have one vote on a

show of hands and on a poll every member present in person or by proxy shall have one vote for every

share of which he/she is the holder.

A person who is not a member of the Company but who has been nominated by a member to enjoy

information rights does not have a right to appoint any proxies under the procedures set out in these

notes and should read note 9 below.

The

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Company

Accounts

Shareholder

Information

88 | Miton UK MicroCap Trust plc | Annual Report 2024

Administrative Notes in Connection with the Annual General Meeting continued

3. Appointment of a proxy online

Members can appoint a proxy online via the Link Investor Centre app or at: https://investorcentre.

linkgroup.co.uk/Login/Login. In order to appoint a proxy using this website, members will need their

Investor Code, which they can find on their share certificate. If you need help with voting online, please

contact our Registrar, Link Group, on 0371 664 0300, or email Link at shareholderenquiries@linkgroup.

co.uk. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the

United Kingdom will be charged at the applicable international rate. Lines are open between 09:00

– 17:30, Monday to Friday excluding public holidays in England and Wales. Members must appoint a

proxy using the website no later than 48 hours before the time of the Annual General Meeting or any

adjournment of that meeting.

Link Investor Centre is a free app for smartphone and tablet provided by Link Group (the Company’s

registrar). It allows you to securely manage and monitor your shareholdings in real time, take part in

online voting, keep your details up to date, access a range of information including payment history

and much more. The app is available to download on both the Apple App Store and Google Play, or by

scanning the relevant QR code below. Alternatively, you may access the Link Investor Centre via a web

browser at: https://investorcentre.linkgroup.co.uk/Login/Login.

4. Appointment of proxy using Proxymity

If you are an institutional investor you may also be able to appoint a proxy electronically via the

Proxymity platform, a process which has been agreed by the Company and approved by the

Registrar. For further information regarding Proxymity, please go to www.proxymity.io. Your proxy

must be lodged by 11:30am on 20 September 2024 in order to be considered valid or, if the meeting

is adjourned, by the time which is 48 hours before the time of the adjourned meeting. Before you

can appoint a proxy via this process you will need to have agreed to Proxymity’s associated terms and

conditions. It is important that you read these carefully as you will be bound by them and they will

govern the electronic appointment of your proxy. An electronic proxy appointment via the Proxymity

platform may be revoked completely by sending an authenticated message via the platform

instructing the removal of your proxy vote.

5. Appointment of a proxy using a Form of Proxy

You may request a hard copy form of proxy directly from the Registrar by emailing at

shareholderenquiries@linkgroup.co.uk or by telephone on 0371 664 0300. To be valid, a Form of Proxy

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 by the Registrar at Link Group, PXS 1, Central Square, 29 Wellington Street, Leeds,

LS1 4DL no later than 48 hours before the time of the Annual General Meeting or any adjournment of

that meeting.

Notice of Annual General Meeting continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 89

Administrative Notes in Connection with the Annual General Meeting continued

6. Appointment of a proxy through CREST

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 by

logging on to the following website: www.euroclear.com. 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.

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

Registrar Link Group (ID RA10) no later than 48 hours before the time of the Annual General Meeting

or any adjournment of that meeting. For this purpose, the time of receipt will be taken to be the

time (as determined by the timestamp applied to the message by the CREST Application Host) from

which the 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.

CREST members and, where applicable, their CREST sponsors or voting service provider(s) 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 their 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.

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 (as amended).

Unless otherwise indicated on the Form of Proxy, CREST, Proxymity or any other electronic voting

instruction, the proxy will vote as they think fit or, at their discretion, withhold from voting.

7. Appointment of proxy by joint holders

In the case of joint holders, where more than one of the joint holders purports to appoint one or

more proxies, only the purported appointment submitted by the most senior holder will be accepted.

Seniority shall be determined by the order in which the names of the joint holders stand in the

Company’s register of members in respect of the joint holding.

The

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Accounts

Shareholder

Information

90 | Miton UK MicroCap Trust plc | Annual Report 2024

Administrative Notes in Connection with the Annual General Meeting continued

8. Corporate representatives

Any corporation which is a member can appoint one or more corporate representatives. Members

can only appoint more than one corporate representative where each corporate representative is

appointed to exercise rights attached to different shares. Members cannot appoint more than one

corporate representative to exercise the rights attached to the same share(s).

9. Entitlement to attend and vote

To be entitled to attend and vote at the Annual General Meeting (and for the purpose of determining

the votes they may cast), members must be registered in the Company’s register of members at close

of business on 20 September 2024 (or, if the Annual General Meeting is adjourned, at close of business

on the day two days prior to the adjourned meeting). Changes to the register of members after the

relevant deadline will be disregarded in determining the rights of any person to attend and vote at the

Annual General Meeting.

10. Nominated persons

Any person to whom this notice is sent who is a person nominated under section 146 of the Companies

Act 2006 (the “Act”) to enjoy information rights (a “Nominated Person”) may, under an agreement

between them and the member by whom they were 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, they may, under any such agreement, have

a right to give instructions to the member as to the exercise of voting rights.

11. Website giving information regarding the Annual General Meeting

Information regarding the Annual General Meeting, including information required by section 311A of

the Act, and a copy of this Notice of Annual General Meeting is available from the Company’s website

at www.mitonukmicrocaptrust.com/

12. Audit concerns

Members should note that it is possible that, pursuant to requests made by members of the Company

under section 527 of the Act, the Company may be required to publish on a website a statement

setting out any matter relating to: (a) the audit of the Company’s accounts (including the auditors’

report and the conduct of the audit) that are to be laid before the Annual General Meeting; or (b) any

circumstance connected with the auditors of the Company ceasing to hold office since the previous

meeting at which annual accounts and reports were laid in accordance with section 437 of the Act.

The Company may not require the members requesting any such website publication to pay its

expenses in complying with sections 527 or 528 of the Act. Where the Company is required to place a

statement on a website under section 527 of the Act, it must forward the statement to the Company’s

auditors not later than the time when it makes the statement available on the website. The business

which may be dealt with at the Annual General Meeting includes any statement that the Company

has been required under section 527 of the Act to publish on a website.

Notice of Annual General Meeting continued

Annual Report 2024 | Miton UK MicroCap Trust plc | 91

Administrative Notes in Connection with the Annual General Meeting continued

13. Voting rights

As at 10 July 2024 (being the latest practicable date prior to the publication of this Notice) the

Company’s issued share capital consisted of 76,923,603 Ordinary Shares, carrying one vote each, and

50,000 management shares of £1 each. The total number of voting rights in the Company is 76,923,603.

14. Notiﬁcation of shareholdings

Any person holding 3% or more of the total voting rights of the Company who appoints a person other

than the Chairman of the Annual General Meeting as their proxy will need to ensure that both they,

and their proxy, comply with their respective disclosure obligations under the Disclosure Guidance and

Transparency Rules.

15. Members’ right to require circulation of resolution

To be proposed at the Annual General Meeting Members meeting the threshold requirements set

out in the Act have the right to: (a) require the Company to give notice of any resolution which can

properly be, and is to be, moved at the Annual General Meeting pursuant to section 338 of the Act;

and/or (b) include a matter in the business to be dealt with at the Annual General Meeting, pursuant to

section 338A of the Act.

16. Further questions and communication

Under section 319A of the Act, the Company must cause to be answered any question relating to the

business being dealt with at the Annual General Meeting put by a member attending the meeting

unless answering the question would interfere unduly with the preparation for the meeting or involve

the disclosure of confidential information, or the answer has already been given on a website in the

form of an answer to a question, or it is undesirable in the interests of the Company or the good order

of the meeting that the question be answered.

Members may not use any electronic address or fax number provided in this Notice or in any related

documents to communicate with the Company for any purpose other than those expressly stated.

17. Documents available for inspection

Copies of the Letters of Appointment of the Non-Executive Directors of the Company will be available

for inspection at the registered office of the Company during normal business hours on any weekday

(Saturdays, Sundays and English public holidays excepted) from the date of this Notice until the

conclusion of the Annual General Meeting and on the date of the Annual General Meeting at the

location of the meeting from 11.15am until the conclusion of the Annual General Meeting.

The

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92 | Miton UK MicroCap Trust plc | Annual Report 2024

at a discount. The size of the discount is calculated

by subtracting the share price from the Adjusted

NAV per share and is usually expressed as a

percentage of the Adjusted NAV per share. If the

share price is higher than the Adjusted NAV per

share, this situation is called apremium.

Discount Calculation Page

30 April

2024

30 April

2023

Closing Adjusted NAV

per share (pence) ii 55.79 64.20 (a)

Closing share price

(pence) ii 50.50 59.50 (b)

Discount

(c=((a-b)/a)*100) (9.48%) (7.32%) (c)

Dividend Yield

The annual dividend expressed as a percentage of

the mid-market share price.

Financial Conduct Authority (“FCA”)

This regulator oversees the fund management

industry, including the operation of the Company.

Financial Reporting Council (“FRC”)

The FRC regulates UK auditors and provides

guidance to accountants with the aim of promoting

better transparency and integrity in the annual

reports of quoted businesses.

FTSE 100 Put Option

A FTSE 100 Put Option is a type of derivative contract

in which the underlying value is based on the level of

the FTSE 100 index.

Gearing

Gearing refers the ratio of the Company’s debt to its

equity capital. The Company may borrow money to

invest in additional investments for its portfolio. If

the Company’s assets grow, the shareholders’ assets

grow proportionately because the debt remains the

same. 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.

Growth Stock

A stock where the earnings are expected to grow

at an above-average rate, leading to a faster than

average growing share price. Growth stocks do not

usually pay a significant dividend.

Glossary

Alternative Investment Market (“AIM”)

MINI’s shares are traded on the London Stock

Exchange, although most the stocks held in

the Company’s portfolio are quoted on the AIM

exchange. AIM is owned by the London Stock

Exchange and was principally set up to meet the

funding needs of smaller, growing companies.

Alternative Performance Measure (“APM”)

An APM is a numerical measure of the Company’s

current, historical or future financial performance,

financial position or cash flows, other than a financial

measure defined or specified in the applicable

financial framework.

Annual General Meeting (“AGM”)

All public companies have an AGM every year,

and this is the opportunity for the shareholders

to confirm their approval of the annual accounts,

the annual dividend and the appointment of the

Directors and Auditors. It is also a good time for

shareholders to meet the non-executive Directors.

The Company’s AGM is on 24 September 2024. The

Notice of Meeting can be found on pages 85 to 91.

Deutsche Numis Indices

Deutsche Numis provides a range of indices covering

the entire UK equity market.

The Deutsche Numis Smaller Companies Index

or DNSCI targets the bottom 10% of the main UK

market by value.

The Deutsche Numis Smaller Companies 1000 Index

targets the bottom 2% of the main UK market (XIC)

by value.

The Deutsche Numis Large Cap Index targets the

top 80% of the UK main list by value.

The Deutsche Numis Alternative Markets Index covers

all companies listed on qualifying alternative markets.

The Deutsche Numis All Share Index contains all fully

listed stocks plus all stocks listed on AIM.

Discount/Premium

If the share price of an investment trust is lower than

the NAV or Adjusted NAV per share, the shares are

said to be trading

Annual Report 2024 | Miton UK MicroCap Trust plc | 93

Key Performance Indicators (“KPIs”)

KPIs are a short list of corporate attributes that are

used to assess general progress of the business and

are outlined in this Report on page 19.

Investment Association (“IA”)

The IA is the trade body that represents UK

investment managers. Premier Miton Group plc is

amember.

Northern Trust Secretarial Services (UK) Limited

(“NTSSL”)

NTSSL is the Company Secretary for the Company.

Net Asset Value per Ordinary Share or Statutory

NAV (“NAV”) or Adjusted Net Asset Value per

Ordinary Share (“Adjusted NAV”)

The NAV is shareholders’ funds expressed as an

amount per individual share. Shareholders’ funds are

the total value of all of the Company’s assets, at their

current market value, having deducted all liabilities

and prior charges at their par value, or at their asset

value as appropriate. The NAV per share is calculated

by dividing the shareholders’ funds by the number

of Ordinary Shares in issue excluding treasury shares.

The Adjusted NAV is the Statutory NAV presented in

the financial statements adjusted to exclude the fair

value of warrants held by the Trust. The fair value of

warrants is calculated by Black Scholes. See Note 12

Fair Value Hierarchy Level 3 investments on page 72.

Ongoing Charges

As recommended by the AIC in its guidance,

ongoing charges are the Company’s annualised

revenue and capital expenses (excluding finance

costs and certain non-recurring items) expressed as

a percentage of the average monthly net assets of

the Company during the year.

Ongoing Charges

Calculation Page

30 April

2024

30 April

2023

Management fee 67 392 597

Other administrative expenses 68 672 676

Less non recurring fees (87) (86)

Total management fee and

other administrative expenses

(annualised) 977 1,187 (a)

Average net assets in the year 49,079 69,083 (b)

Ongoing charges (c=a/b)*100 1.99% 1.72% (c)

Peer Group

The Company is part of the AIC’s UK Smaller

Companies sector whose members invest at least

80% of their assets in UK Smaller Companies.

As at 30 June 2024, the following were constituents

of this peer group:

•

Aberforth Smaller Companies Ord

•

Aberforth Split Level Income Ord

•

abrdn UK Smaller Companies Growth Ord

•

Athelney Trust Ord

•

BlackRock Smaller Companies Ord

•

BlackRock Throgmorton Trust Ord

•

Crystal Amber Ord

•

Downing Strategic Micro-Cap Inv. Ord

•

Henderson Smaller Companies Ord

•

Invesco Perpetual UK Smaller Ord

•

JPMorgan UK Small Cap Growth & Income

•

Marwyn Value Investors Ord

•

Miton UK Microcap Ord

•

Montanaro UK Smaller Companies Ord

•

Odyssean Investment Trust Ord

•

Onward Opportunities Ord

•

Oryx International Growth Ord

•

Rights & Issues Investment Trust Ord

•

River and Mercantile UK Micro Cap Ord

•

Rockwood Strategic Ord

•

Strategic Equity Capital Ord

•

SVM UK Emerging Ord

•

Worsley Investors Ord

Price to Book Ratio

The price to book ratio is a valuation measure which

divides a company’s share price by its asset value

per share. Lower values can imply that a company

is either an overlooked opportunity or a poorly

performing business, Higher values may suggest

a company is overvalued, unless its returns are

sustainably high.

The

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Shareholder

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94 | Miton UK MicroCap Trust plc | Annual Report 2024

Redemption Pool

In the event that the Board elects to calculate the

Redemption Price through the use of a Redemption

Pool, the pool of cash, assets and liabilities to be

created by the Directors in respect of a particular

Redemption Point and allocated to the Ordinary

Shares which are the subject of Redemption

Requests for that Redemption Point.

Senior Independent Director (“SID”)

The SID is a non-executive director who can be

contacted by investors to discuss a matter of

governance when it concerns the Chairman and the

normal practice cannot be followed. The Company’s

SID is Davina Walter.

Tap Issue

A tap issue is a procedure that allows the Company

to issue new shares at the current market value

when the share price is at a premium to NAV. The

Company is authorised to issue up to 10% of its

share capital without the need for an open offer.

This enables the Company to invest in attractive

investment opportunities and to issue new shares on

a flexible and cost-effective basis.

Total Assets

Total assets include investments, cash, current

assets and all other assets. An asset is an economic

resource, being anything tangible or intangible that

can be owned or controlled to produce value and to

produce positive economic value. Assets represent

the value of ownership that can be converted

into cash. The total assets less all liabilities will be

equivalent to total shareholders’ funds.

Total Return – NAV and Share Price Returns

Total return statistics enable the investor to make

performance comparisons between investment

trusts with different dividend policies. The Total

Return measures the combined effect of any

dividends paid, together with the rise or fall in the

share price or NAV or Adjusted NAV.

Glossary continued

This is calculated by the movement in the share

price or NAV plus the dividends paid by the

Company assuming these are re-invested in the

Company at the prevailing NAV.

Adjusted NAV

Total Return Page

30 April

2024

30 April

2023

Closing Adjusted NAV per

share (pence) ii 55.79 64.20

Add back ﬁnal dividend

for the year ended 30April

2023 (2022) (pence) 70 0.15 0.15

Closing Adjusted NAV

(pence) 55.94 64.35 (a)

Opening Adjusted NAV per

share (pence) ii 64.20 91.05 (b)

NAV total return

(c = (a-b)/b) (%) (12.9%) (29.3%) (c)

Share Price

Total Return Page

30 April

2024

30 April

2023

Closing share price (pence) ii 50.50 59.50

Add back ﬁnal dividend

for the year ended 30April

2023 (2022) (pence) 70 0.15 0.15

Adjusted closing

share price (pence) 50.65 59.65 (a)

Opening share price

(pence) ii 59.50 86.50 (b)

Share price total

return unadjusted

(c = (a-b)/b) (%) (15.1%) (31.0%) (c)

Share price total return

adjusted (%) (14.9%) (31.1%)*

* Based on NAV/share price movements and dividends being reinvested at

the relevant cum dividend NAV/share price during the period. Where the

dividend is invested and the NAV/share price falls, this will further reduce the

return or, if it rises, any increase will be greater. The source is Morningstar who

have calculated the return on an industry comparative basis.

Yield Stock

Yield stocks pay above-average dividends to

shareholders. If the dividend grows, and the yield

on the share remains constant, the share price will

increase. Companies which grow their dividends

faster than average are capable of delivering faster

share price growth.

Annual Report 2024 | Miton UK MicroCap Trust plc | 95

Investment Manager

Premier Fund Managers Limited

Eastgate Court

High Street

Guildford

Surrey GU1 3DE

Telephone: 01483 306 090

www.premiermiton.com

Authorised and regulated by the Financial Conduct

Authority

Alternative Investment Fund Manager

Premier Portfolio Managers Limited

Eastgate Court

High Street

Guildford

Surrey GU1 3DE

Telephone: 01483 306 090

www.premiermiton.com

Authorised and regulated by the Financial Conduct

Authority

Company website

www.mitonukmicrocaptrust.com

Secretary and Registered Ofﬁce

Northern Trust Secretarial Services (UK) Limited

50 Bank Street

Canary Wharf

London E14 5NT

Telephone: +44 (0) 207 982 2000

Depositary and Custodian

Northern Trust Investor Services Limited

50 Bank Street

Canary Wharf

London E14 5NT

Authorised by the Prudential Regulation Authority

(“PRA”) and regulated by the FCA and PRA

Company Administrator*

Northern Trust Global Services SE

50 Bank Street

Canary Wharf

London E14 5NT

* Certain administrative functions have been delegated to Northern Trust

Global Services SE by Premier Portfolio Managers Limited.

Registrar and Transfer Ofﬁce

Link Group

The Registry

Central Square

29 Wellington Street

Leeds LS1 4DL

Telephone: 0371 664 0300

(Calls are charged at the standard geographic

rate and will vary by provider. Calls outside the

United Kingdom will be charged at the applicable

international rate)

Email: enquiries@linkgroup.co.uk

Website: www.linkassetservices.com

Auditor

BDO LLP

55 Baker Street

London W1U 7EU

Solicitor

Stephenson Harwood LLP

1 Finsbury Circus

London EC2M 7SH

Stockbroker

Peel Hunt LLP

100 Liverpool Street

London EC2M 2AT

Contact Details of Advisers

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96 | Miton UK MicroCap Trust plc | Annual Report 2024

Notes

Shareholder warning

Many companies are aware that their shareholders have received unsolicited phone calls or

correspondence concerning investment matters. These calls typically come from fraudsters operating in

‘boiler rooms’ offering investors shares that often turn out to be worthless or non-existent, or an inflated

price for shares they own. While high profits are promised, those who buy or sell shares in this way usually

lose their money. These fraudsters can be very persistent and extremely persuasive. Shareholders are

therefore advised to be very wary of any unsolicited advice, offers to buy shares at a discount or offers of

free company reports.

It is very unlikely that either the Company or the Company’s Registrar would make unsolicited telephone

calls to shareholders and that any such calls would relate only to official documentation already circulated

to shareholders and never in respect of investment ‘advice’.

If you have been contacted by an unauthorised firm regarding your shares, you can report this using the

FCA helpline on 0800 111 6768 or by using the share fraud reporting form at:

www.fca.org.uk/consumers/scams.

Eastgate Court

High Street

Guildford GU1 3DE

Source: Morningstar from 30/04/2015 to 30/04/2024.

Company performance since launch on 30 April 2015

100

150

200

250

Apr-15

Oct-15

Apr-16

Oct-16

Apr-17

Oct-17

Apr-18

Oct-18

Apr-19

Oct-19

Apr-20

Oct-20

Apr-21

Oct-21

Apr-22

Oct-22

Apr-23

Oct-23

Apr-24

Percent

Deutsche Numis

SC 1000 Index

MINI Share price

MINI Adjusted NAV