Pacific Assets Trust plc – Annual Report for the Year Ended 31 January 2026

LONDON STOCK EXCHANGE ANNOUNCEMENT

Pacific Assets Trust plc

(the «Company»)

Annual Results for the Year Ended 31 January 2026

The statements below are extracted from the Company’s annual report for the year
ended 31 January 2026 (the «Annual Report»).  The Annual Report, which includes
the notice of the Company’s forthcoming annual general meeting, will be
submitted to the Financial Conduct Authority today and will shortly be available
in full, unedited text for inspection on the National Storage Mechanism («NSM»):
https://data.fca.org.uk/#/nsm/nationalstoragemechanism

The Annual Report will be posted to shareholders on 8 May 2026. Members of the
public may obtain copies by writing to Frostrow Capital LLP, 25 Southampton
Buildings, London WC2A 1AL or from the Company’s website at www.pacific
-assets.com where up to date information on the Company, including daily NAV,
share prices and fact sheets, can also be found.

Frostrow Capital LLP, Company Secretary

0203 709 8734

1 May 2026

Company Performance

Performance Summary

As at As at
31 January 31 January
2026 2025
Shareholders’ funds £470.8m £503.4m
Market capitalisation £423.9m £431.7m

One year to One year to
31 January 31 January
Performance 2026 2025
Net asset value per share total 0.0% 9.7%
return1 2
Share price total return1 2 5.1% 3.7%
MSCI All Country Asia ex Japan 28.6% 22.3%
Index (total return, sterling
adjusted)1
Average discount of share price to 11.4% 11.5%
net asset value per share1 2
Ongoing charges2 1.1% 1.1%
Revenue return per share 5.6p 5.4p
Dividend per share 5.7p 4.9p

1 Source: Morningstar

2 Alternative Performance Measure

Chair’s Statement

Introduction and Results

The Company’s NAV total return for the year ended 31 January 2026 was 0.0%,
significantly lagging the 28.6% rise in the MSCI AC Asia ex Japan Index (total
return, sterling adjusted). This disappointing outcome places the Company at the
bottom of its peer group over most longer time periods and remains a central
concern for the Board.

The past year has been a difficult one for the Company. In August, Stewart
Investors announced the resignation of David Gait and two other senior portfolio
managers from the investment team. In October, the Board announced three
strategic initiatives benefitting the Company’s shareholders which comprised a
reduction in the portfolio management fee, the introduction of a performance
-related tender offer for up to 25% of the Company’s issued share capital and a
reinforced commitment to buying back shares to help reduce the discount to net
asset value («NAV») at which the Company’s shares trade.

In November, First Sentier Group informed the Board of its decision to close the
Stewart Investors business, with portfolio management responsibilities
transitioning to its affiliate investment team, FSSA Investment Managers
(«FSSA»). Although both teams share a similar investment philosophy and
approach, the Board concluded that such a material change warranted a broader
reassessment of the Company’s future. After consulting major shareholders, the
Board launched a strategic review on 11December 2025 to evaluate the full range
of options for the Company’s future, including proposals from alternative
investment managers (FSSA among them) and potential combination candidates.

As the transition to FSSA occurred only in the final months of the financial
year, their ability to reposition the portfolio was necessarily limited. In
light of the ongoing strategic review, the Board also instructed FSSA to
restrict portfolio turnover to a maximum of 20%. With only modest scope for
adjustments, the Portfolio Manager has made incremental reallocations, adding
selectively to Chinese and Southeast Asian holdings and reducing certain
cyclical exposures in India.

Economic and market conditions across the region were uneven. China saw a modest
uplift due to selective policy support, yet structural challenges in the
property market, local government finances and consumer sentiment persisted.
India continued to grow at one of the fastest rates globally, supported by
resilient domestic demand, but equity valuations in several sectors normalised
after a prolonged period of outperformance. Meanwhile, Taiwan and South Korea
benefited disproportionately from a surge in demand for advanced semiconductors
and AI related hardware, resulting in one of the most concentrated market
rallies in recent years. In this environment where performance was dominated by
a narrow group of technology led markets, quality companies across India and
Southeast Asia (core areas of the portfolio) were largely overlooked despite
solid fundamentals.

Despite these challenging conditions, FSSA continued to identify compelling
bottom up opportunities across China, India, Indonesia, the Philippines and
Taiwan. The limited adjustments undertaken during the transition emphasised
companies with stronger cash generation and more durable long term growth
prospects and have increased the liquidity of the portfolio.

While the investment strategy has historically demonstrated resilience in more
volatile or falling markets, as seen in 2023, it has struggled during the
sharply rising conditions of the past two years.

The Board recognises that the Company’s longer term performance record has
deteriorated relative to its peers and understands that shareholders expect
meaningful improvement. The aim of the strategic review, therefore, is to
identify the course of action that will best serve shareholders over the long
term.

Strategic Review

As mentioned above, in December your Board initiated a strategic review of the
future of the Company. The Board has considered a range of possible options
including retaining the existing manager, appointing a new external, third-party
manager and entering into a combination with another investment trust. The Board
was pleased that the Company received interest from a large number of high
-quality management groups, including FSSA, which have been evaluated by the
Board with the assistance of the corporate stockbroker, Investec Bank plc. The
review is nearing completion and the Board expects to make an announcement
within the next few weeks.

The Board wishes to acknowledge both the professionalism of the outgoing team at
Stewart Investors and the constructive engagement of FSSA during a period of
considerable operational and market complexity.

Share price performance

The Company’s share price total return for the year was 5.1%, benefitting from
the share price discount narrowing relative to the NAV total return. The shares
traded at an average discount of 11.4% (2025: 11.5%), and the Company
repurchased 6.3 million shares over the year, at a cost of £22.5 million, and at
an average discount of 11.8%. Buybacks were paused once the strategic review was
announced, but increased interest from certain investors has provided some
natural discount management since that time.

The Sales, Marketing and Communications Committee made good progress on planned
marketing initiatives; however, much of the activity has been necessarily
deferred pending the outcome of the strategic review.

Dividend

The Company generated a revenue return of 5.6p per share during the year (2025:
5.4p per share) and, as a result, the Board recommends to shareholders the
payment of a final dividend to ensure the Company complies with the investment
trust rules regarding distributable income.

Subject to shareholder approval at the AGM, a final dividend of 5.7p per share
will be paid on 10July2026 to shareholders on the register on 12 June 2026. The
associated ex-dividend date will be 11June 2026.

The Board

Having served on the Board for just over nine years now, Robert Talbut intended
to retire from the Board at the AGM in July. However, at the Board’s request,
Robert has agreed to remain on the Board until the outcome of the strategic
review has been implemented, to ensure continuity and stability during the
process. The Board is grateful for his commitment and support.

The Annual General Meeting

As noted above, the Board shortly expects to announce the conclusion of its
strategic review and looks forward to discussing the outcome with shareholders
over the coming weeks and months. One such opportunity will be at our annual
general meeting («AGM») to be held at 10.30am on Tuesday, 7July2026, at Dashwood
House, 69 Old Broad St, London EC2M 1QS.

The Board strongly encourages shareholders to register their proxy voting
instructions online in advance of the AGM. Registering your proxy voting
instructions in advance will not restrict shareholders from attending and voting
at the meeting in person should they wish to do so. The Board recommends that
shareholders vote in favour of all the resolutions set out in the Notice of AGM
as each of the directors intends to do in respect of their own holdings.

Outlook

Overall, Asia remains well positioned over the long run, supported by favourable
demographics, the continued expansion of the region’s digital economy, and
increasing participation in global technology and innovation supply chains.
However, the near term environment is likely to be characterised by greater
dispersion of returns across markets and sectors, reinforcing the importance for
investors of selectivity, discipline and attention to underlying fundamentals.

FSSA provide further comment in their report.

Andrew Impey
Chair

30 April 2026

Investment Portfolio

as at 31 January 2026

Company Country Sector Value % Total

£’000 Assets
Samsung South Korea Information Technology 31,512 6.7%
Electronics
Oversea-Chinese Singapore Financials 17,734 3.8%
Banking Corp
Airtac Taiwan Industrials 16,156 3.4%
International
Taiwan Taiwan Information Technology 15,701 3.3%
Semiconductor
Manufacturing
Jardine Matheson Hong Kong Industrials 14,658 3.1%
Alibaba China Consumer Discretionary 14,479 3.1%
Hoya Japan Health Care 14,166 3.0%
DFI Retail Hong Kong Consumer Staples 13,991 3.0%
Tencent China Communication Services 11,486 2.4%
Kotak Mahindra India Financials 11,474 2.4%
Bank
Top 10 161,357 34.2%
Investments
Shenzhen Inovance China Industrials 11,410 2.4%
Technology
Techtronic Hong Kong Industrials 11,144 2.3%
Industries
Mahindra & India Consumer Discretionary 10,976 2.3%
Mahindra
Midea China Consumer Discretionary 10,421 2.2%
AIA Hong Kong Financials 10,282 2.2%
Ayala Philippines Industrials 10,270 2.2%
Voltronic Power Taiwan Industrials 10,118 2.1%
Technology
Sheng Siong Singapore Consumer Staples 9,893 2.1%
Bank OCBC Nisp Indonesia Financials 9,328 2.0%
Trip.com China Consumer Discretionary 9,113 1.9%
Top 20 264,312 55.9%
Investments
Tube Investments India Consumer Discretionary 8,846 1.9%
of India
Elgi Equipments India Industrials 8,704 1.8%
Philippine Seven Philippines Consumer Staples 8,351 1.8%
Cholamandalam India Financials 8,184 1.7%
Financial
Dongguan Yiheda China Industrials 7,991 1.7%
Automation
Shanthi Gears India Industrials 7,920 1.7%
Mani Japan Health Care 7,447 1.6%
Sundaram Finance India Financials 7,435 1.6%
SF Holding China Industrials 7,397 1.6%
Triveni Turbine India Industrials 7,255 1.5%
Top 30 343,842 72.8%
Investments

Company Country Sector Value % Total

£’000 Assets
HDFC Bank India Financials 6,425 1.4%
ViTrox Corp Malaysia Information Technology 6,352 1.3%
Delta Taiwan Information Technology 6,044 1.3%
Electronics
Bajaj Auto India Consumer Discretionary 6,031 1.3%
Kasikornbank Thailand Financials 5,879 1.2%
MediaTek Taiwan Information Technology 5,828 1.2%
Chroma ATE Taiwan Information Technology 5,589 1.2%
Tech Mahindra India Information Technology 5,357 1.1%
Glodon China Information Technology 5,032 1.1%
Marico India Consumer Staples 4,924 1.0%
Top 40 401,303 84.9%
Investments
Shenzhen
Mindray Bio
-Medical
Electronics China Health Care 4,682 1.0%
CG Power & India Industrials 4,605 1.0%
Industrial
Solutions
Centre Testing China Industrials 4,578 1.0%
International
Aavas India Financials 4,366 0.9%
Financiers Ltd
Bank Central Indonesia Financials 4,270 0.9%
Asia
Info Edge India India Communication Services 4,151 0.9%
Selamat Indonesia Consumer Discretionary 3,968 0.8%
Sempurna
Sea Singapore Consumer Discretionary 3,844 0.8%
Godrej Consumer India Consumer Staples 3,842 0.8%
Products
Vitasoy Hong Kong Consumer Staples 3,752 0.8%
International
Top 50 443,361 93.8%
Investments
SM Investments Philippines Industrials 3,648 0.8%
Humanica Thailand Industrials 3,141 0.7%
BDO Unibank Philippines Financials 2,967 0.6%
Silergy Taiwan Information Technology 2,780 0.6%
Bajaj Holdings India Financials 2,666 0.6%
& Investment
Bank of the Philippines Financials 2,450 0.5%
Philippine
Islands
SF Holding China Industrials 2,420 0.5%
FPT Vietnam Information Technology 2,403 0.5%
Yifeng Pharmacy China Consumer Staples 2,027 0.4%
Chain
Kalbe Farma Indonesia Health Care 2,019 0.4%
Marico Bangladesh Consumer Staples 1,900 0.4%
Bangladesh
Tarsons India Health Care 771 0.2%
Products
Total 472,553 100.0%
Investments

Portfolio Manager’s Review

In November 2025, First Sentier Group («FSG») announced a strategic transition
of Stewart Investors’ («SI») investment management responsibilities to its
affiliate investment team, FSSA Investment Managers («FSSA»). FSSA have managed
the Company’s portfolio since 14November2025.

Over the year to 31 January 2026, the net asset value total return of the
Company was 0.0%. The MSCI AC Asia ex-Japan Index, measured on a net, total
return, sterling adjusted basis (the «Index») rallied, returning 28.6% over the
same period. Part of the underperformance stems from the Company’s positioning
in India, as holdings which are good quality but expensive were derated.
However, we believe there are still good opportunities for active managers to
add value with a disciplined, research-driven approach. Although India has been
out of favour, we remain excited about the long-term investment opportunities in
this market, with growth being underpinned by growing levels of urbanisation,
favourable demographics, rising middle class consumption and a strong digital
infrastructure push.

Another reason for the relative underperformance was the level of market
concentration in a few stocks and themes – around two-thirds of the total return
of the Index was driven by technology and Artificial Intelligence («AI»)-related
companies. Outside of these sectors, many high-quality businesses – particularly
in Southeast Asia, India and China’s traditional sectors – have not performed
despite solid earnings growth, improving governance and attractive valuations.

In particular, Korean and Taiwanese chipmakers have seen valuations expand
rapidly on the future promise of AI. Taiwan Semiconductor Manufacturing
(«TSMC»), Samsung Electronics, and SK Hynix – all related to the AI theme – now
comprise almost a quarter of the Index’s weight. On a country level, TSMC now
commands a staggering 59% of MSCI Taiwan, up from 24% at the end of 2015.
Samsung Electronics and SK Hynix together represent more than 50% of MSCI Korea,
compared to just 23% adecade ago.1 This underscores the outsized role of a
handful of firms in shaping regional returns.

With everything seemingly about AI, we believe it is critical to remain
disciplined in our investment approach and focused on quality. Momentum phases
tend to favour companies with eye-catching narratives rather than those with
solid balance sheets or dependable earnings. Yet far from weakening the case for
quality investing, such episodes strengthen it.

Global research2 shows that high-quality companies are consistently underpriced,
as the market routinely underestimates their future returns. Low-quality
companies are consistently overpriced, as over-optimistic analysts generate
larger forecast errors. Crucially, the mispricing of quality is not random. The
research identifies a «price of quality» that fluctuates over time. It is
typically lowest during speculative booms – such as the late 1990s technology
surge or the run up to the financial crisis – when investors place less emphasis
on fundamental strength and more on market narratives.

When the price of quality becomes unusually compressed, subsequent returns from
quality strategies tend to rise. In effect, weak periods for quality often lay
the groundwork for future outperformance.

1Source; FactSet, as at 30 January 2026

2Clifford S. Asness, Andrea Frazzini & Lasse Heje Pedersen (2018), Quality minus
junk, Review of Accounting Studies (2019), 24:34-112

The recurring lesson from more than half a century of data is that quality
investing succeeds not because markets are always rational, but because they
frequently are not. Periods in which quality appears to lag – particularly when
speculative assets dominate the headlines – are often the prelude to its
strongest returns.

Positioning for growth opportunities across Asia

As benchmark-agnostic investors, we pay little attention to index compositions
or returns. We focus instead on generating absolute returns for our clients in
the long run. Our track record, when viewed through the lens of the market
environment, shows that our portfolios tend to perform better in «normal»
markets (-15% to +15% 1-year rolling returns) and bear markets (more than 15%
decline), than in steeply rising markets (defined as over 15% 1-year rolling
returns).

Through our bottom-up research, we own dominant industry leaders that have
exposure to AI like TSMC and Tencent, but we remain sceptical about many
expensive and cyclical AI-related companies in Asia. Beyond technology, we have
positioned the portfolio to tap into the long-term growth opportunities across
Asia. One example is Bank of the Philippine Islands («BPI»), the second largest
bank in the Philippines with roughly 15% market share in loans and 13% in
deposits. BPI operates with one of the leanest cost structures in the Philippine
banking sector, supported by its scale, automation and relatively higher
productivity per branch. It is majority-owned by Ayala Corporation, one of the
Philippines’ most established and influential business groups. As a result, it
has many of Ayala’s associated qualities: astrong governance framework, a
measured growth strategy and operational professionalism.

Although Southeast Asia appears to be unloved by investors, we believe the
opportunity here is sizeable. The Philippines is one of the most under
-penetrated banking markets in Asia relative to its economic size and
demographics. With a population of ~114 million and a GDP of US$505 billion, it
is among Southeast Asia’s larger economies, yet its household credit-to-GDP
remains closer to frontier market levels. Webelieve BPI should compound earnings
steadily in the years to come.

We have also been significant and constructive shareholders of various Jardine
Matheson («JM») group companies. The Hong Kong-based group has sprawling
business interests across Asia, including real estate, supermarkets, hotels and
automotives. JM has been reinventing itself and we expect changes to accelerate
in the coming years.

The new externally appointed CEOs at subsidiary companies DFI, Mandarin Oriental
and Hongkong Land have begun to focus on the most attractive parts of their
businesses, while exiting non-core ventures to improve returns on invested
capital and return cash to shareholders where appropriate. Improving total
shareholder return is the new mantra for the group.

More needs to be done to shift the group back towards a growth pathway, but we
expect changes to accelerate in the coming years. Lincoln Pan has joined as JM’s
CEO, taking over from John Witt who retired from the company. Pan joins from
private equity group PAG and is the first external taipan at the group. This is
significant and an indication of the changing culture at the group.

In India, there have been few opportunities on a bottom-up basis over the past
couple of years, as valuations across the board were quite expensive. However,
as earnings have grown, valuations have become more attractive, and we are
beginning to find more ideas at the margin. For instance, we own HDFC Bank, a
high-quality private bank. Over the long term, it has been gaining share at the
expense of state-owned banks, but in recent times it has been derated on
concerns about near-term income pressure and slower loans growth. We believe
this is now behind us.

At Kotak Mahindra Bank («KMB»), we also note signs of improvement across
different areas of the business. It has grown its savings accounts; credit costs
have been declining; and the cost/income ratio is showing signs of improvement
due to the bank’s investments into digitisation and automation. For a business
that should continue to compound at a mid-teens rate – we believe the current
valuation makes the risk-reward look attractive.

Contributors

The largest contributor to performance over the period was Samsung Electronics,
a leading manufacturer of memory and semiconductor chips. In recent years,
Samsung’s foundry business has been a major point of investor concern, which
culminated in significant losses in the first half of 2025. These losses were
exacerbated by one-time charges related to US export controls to China. The
company has since undertaken a strategic shift from a «capacity-first» to a
«customer-first» model, which appears to be bearing fruit. The shares rose
during the quarter, as Samsung continued to benefit from surging AI-related
demand for its high-bandwidth memory chips as well as tightness in traditional
DRAM (Dynamic Random Access Memory) demand-supply. Strong results from US
chipmaker Micron reinforced expectations of a sustained memory upcycle into
2026. With the turnaround in its foundry business and a strong legacy memory
business, we believe the risk-reward looks favourable.

Delta Electronics, a leading power supply company in Taiwan, was the second
largest contributor to performance. AI-related demand has been «very strong», as
the trend of higher power intensity continues. As the technology leader, Delta
is collaborating with clients to develop new products, which provides a first
-mover advantage whenever there’s an upgrade. There are also discussions about
high voltage direct current («HVDC») power, which should add incremental value
(though it is hard to quantify at this stage). On the other hand, due to strong
demand for AI, there are bottlenecks developing in memory, grid power, chip-on
-wafer-on-substrate («CoWoS»), water and skilled technicians. A slowdown in AI
growth could have a knock-on effect at Delta. We have been reducing our position
size due to rich valuation and very high expectations.

The third largest contributor to performance was DFI Retail, a leading pan-Asian
retailing group with a dominant market position across various segments,
including drug stores, supermarkets, convenience stores, IKEA and Maxim’s (a
joint venture catering and restaurants business). After years of lacklustre
performance, DFI – and the broader Jardine group – has redoubled efforts to grow
the business, and to improve operational efficiencies and returns on capital
while optimising capital allocation. Improving total shareholder return is the
new mantra for the group, and there are now clear signs of improvement. We
believe margins could improve still further and lead to underlying profit
growth.

Detractors

Voltronic Power has had a challenging year and was the largest detractor from
returns. Around a third of its uninterruptible power supply («UPS») sales goes
to the US and was subject to higher tariffs after «Liberation Day», while its
inverter business – which has been hit by weak demand and competition – appears
to be challenged. While the UPS business should normalise sometime in the
future, we assume lower growth for the inverter business. On the other hand,
given the share price has halved over 2025 (from a high base), we believe the
current valuation seems attractive overall.

Tube Investments of India, an engineering group which makes precision steel
tubes for cars, bicycles and other industrial purposes, was the second biggest
detractor due to sluggish business performance and rising competition in the
electric vehicle («EV») space. Despite its early mover advantage, Tube has
struggled to maintain market share. It plans to arrest these challenges by
increasing the number of dealership partners and entering new sub-segments in EV
battery packs. On a positive note, the core business is stable with robust
returns on capital employed, and it generates healthy free cash flow which is
being invested in new businesses with high returns potential. In this endeavour,
we are backing the management, particularly Vellayan Subbiah (executive
chairman), who has an exceptional track record and has created tremendous value
for shareholders.

The third largest detractor was Philippine Seven, operator of 7-11 stores, which
declined after reporting weak earnings results. Same store sales growth has been
weak due to the exit of the Philippine offshore gaming operators («POGOs»),
which were banned in mid-2024. However, the group continues to expand its lead
in terms of store count, and its network is increasingly extending beyond Metro
Manila and into harder-to-reach areas. It has also built an extensive network of
more than 20 distribution centres to cater to company-owned and franchised
stores across the country. At current valuations we believe the risk-reward
looks compelling.

Significant transactions

Given the significant overlap in SI’s and FSSA’s investment philosophy and
portfolios, we know all the holdings well. As part of the transition, we made a
few changes to tilt the portfolio towards companies with stronger cash
generation, higher returns and better long-term growth prospects. In general, we
are adding to holdings in China, where we have found leading businesses like
Tencent, with strong moats and attractive growth at reasonable valuations. We
are reducing exposure to India, mainly in cyclical businesses like Tube
Investments of India, where valuations are expensive, and Motilal Oswal, where
we have lower conviction as the growth outlook has deteriorated.

Below, we highlight a few of the key additions and disposals since the
transition to FSSA.

New investments

Tencent Holdings is the largest social media network and online gaming company
in China, with growing businesses in online advertising, cloud services, e
-payments/e-commerce and overseas gaming. Tencent has created an ecosystem of
businesses which are unrivalled and should continue growing over the medium
term. It has continued to develop new functions within WeChat (such as Video
Accounts and Mini Shops), which should slowly improve monetisation and enhance
the quality of the franchise. AtFSSA, we have been shareholders of Tencent since
2005 and have consistently found the management to be effective long-term
stewards of the business. In recent times, we have been impressed by Tencent’s
AI strategy and its disciplined approach to technology investments, which aligns
with our conservative view on AI capex spending.

Kotak Mahindra Bank («KMB») is one of India’s leading financial services
companies – it has consistently improved the strength of its deposit franchise
and maintained better asset quality than peers through the business cycle. While
the founder, Uday Kotak, has stepped down from his managing director/CEO role
due to the central bank’s limits on leadership terms, he remains closely
involved as a board director and should ensure that the bank’s risk awareness
and long-term thinking is maintained. Meanwhile, the new CEO (Ashok Vaswani)
aspires to grow the business further by focusing on consumer banking and
digitisation. We expect to see a growing trend of formalised financial savings,
benefiting KMB’s insurance, mutual funds and asset management businesses.

Bank Central Asia («BCA») is a leading private bank in Indonesia with 11% loan
market share and 17% market share in low-cost deposits (i.e. current accounts
and savings accounts, or «CASA»). We like the bank’s conservative culture and
solid management, backed by a stable and long-term owner in the Hartono family.
BCA’s moat in transaction banking has created a large pool of low-cost deposits
for the bank which is hard to replicate. BCA then lends sensibly to good
borrowers and earns a healthy return on equity («ROE»), averaging over 20% over
the past 10 years. It has the lowest credit loss ratio and lowest leverage
amongst Indonesian banks. In addition, BCA was early to invest in digitisation
in Indonesia, which has since accelerated its customer acquisition. BCA remains
very profitable, and we believe it has the ability to compound book value at
high rates without taking on too much risk. Low credit penetration and household
debt in Indonesia should provide a favourable backdrop for continued growth.

Disposals

Naver, the South Korean technology platform, was sold on strength to consolidate
the portfolio into higher conviction ideas. While the shares have bounced due to
excitement around Korea and AI, we believe the business faces structural
headwinds in terms of slowing e-commerce growth, and we have been concerned
about their lack of financial discipline in the past.

Motilal Oswal Financial Services is a non-bank financial company («NBFC») in
India. We sold out of alower conviction holding to raise cash for better ideas
elsewhere.

Milkyway Intelligent Supply Chain is a chemical materials logistics company in
China. We sold out of the position on concerns about leverage and poor cash
generation.

Looking forward

We are optimistic on the outlook for the Asia Pacific region, with several signs
pointing to a sustained period of Asian equity outperformance. With a rising
share of global GDP growth, Asia should continue to benefit from the shift
towards higher value services-led growth, digital transformation and the ongoing
financialisation across the region. Valuations look attractive in comparison to
developed markets like the US, while low ownership of Asian equities in global
portfolios provides a good backdrop for absolute returns as global liquidity
flows eastwards.

As markets broaden out their focus from their narrow focus on AI, we believe
quality businesses owned in the portfolio should do well. The Company’s holdings
are characterised by strong competitive advantages, and they have historically
managed to preserve margins and profitability through the cycles. We are
confident that their strong fundamentals will translate into attractive
shareholder returns in the long run. Current portfolio valuations, at 17x
forward price-to-earnings, remain attractive – as they have been over the last
couple of years, while the free cash flow yield of 5.3% is at a historic high as
companies are returning more cash to shareholders. Looking forward, we expect
earnings to compound at a low-to-mid teens rate with circa 20% average returns
on equity, which looks attractive and reasonable to us.

FSSA Investment Managers
Portfolio Manager

30 April 2026

Key Performance Indicators («KPIs»)

The Board of Directors reviews performance against the following KPIs. As
explained in the Half Year Report, the Board decided to retire the Company’s UK
inflation-linked performance objective and instead use a market-based comparator
to measure the Portfolio Manager’s performance. The first KPI has been updated
to reflect this. The remaining KPIs are unchanged from the prior year.

· NAV total return against the MSCI All Country Asia ex Japan Index (the
«Index»)*^
· NAV per share total return against the peer group*^
· Average discount/premium of share price to NAV per share over the year^
· Ongoing charges ratio^

* Calculated on an annual basis and measured over three to five years.

^ Alternative Performance Measure.

NAV per share total return – Index

The Directors regard the Company’s net asset value total return as being the
overall measure of value generated by the Portfolio Manager over the long term.
Total return reflects both the net asset value growth of the Company and the
dividends paid to shareholders.

During the year under review, the NAV per share total return was 0.0%
underperforming the Index by 28.6% (2025: NAV per share total return of 9.7%,
underperforming the Index by 12.6%). Over the past three years, the annualised
NAV per share total return was 2.7%, underperforming the Index by 9.4%. Over
five years, the annualised NAV per share total return was 4.5%, in line with the
Index.

A full description of performance during the year under review is contained in
the Portfolio Manager’s Review.

NAV total return – peer group

The Board also monitors the Company’s performance against its peer group of the
three other investment trusts in the AIC Asia Pacific sector and an exchange
traded fund which tracks the MSCI AC Asia ex Japan Index.

Over the one, three and five years ended 31 January 2026, the Company ranked
5th, 5th and 4th, respectively, in its peer group.

Average discount/premium of share price to NAV per share

The Board believes that the principal drivers of an investment trust’s share
price discount or premium over the long term are investment performance and a
proactive marketing strategy. However, there can be volatility in the discount
or premium during the year. Therefore, the Board takes powers each year to buy
back and issue shares with a view to limiting the volatility of the share price
discount or premium, in normal market conditions.

During the year under review no new shares were issued by the Company. The
Company repurchased 6,325,879 shares during the year, at a total cost of £22.5
million, and at an average discount of 11.8%. The Board keeps the level of the
discount under close review. Please refer to the Chair’s Statement for further
information.

Average discount of share price to NAV per share*^ during the year ended

31 January 202631 January 2025

11.4%                            11.5%

Peer group averagePeer group average

discount 9.0%discount 10.8%

* Source: Morningstar.

^ Alternative Performance Measure.

Ongoing charges ratio

Ongoing charges represent the costs that the Company can reasonably expect to
pay from one year to the next, under normal circumstances. The Board continues
to be conscious of expenses and seeks to maintain a sensible balance between
high quality service and costs.

The Board therefore considers the ongoing charges ratio to be a KPI and reviews
the figure both in absolute terms and in relation to the Company’s peers.

Ongoing charges ratio^

31 January 202631 January 2025

1.1%1.1%

Peer group average 0.9%Peer group average 0.9%

^ Alternative Performance Measure.

During the year the Board agreed with the Portfolio Manager a new portfolio
management fee which will have the effect of lowering the ongoing charges ratio
to 1.0% in the first full year. The Board believes that the Company’s relatively
low turnover, and the absence of any costs associated with gearing, will mean
that the Company’s overall running costs – should these costs be factored into
the calculation – are not necessarily as high as some other investment vehicles.
It should also be noted that the Company does not have a performance fee.
Performance fees are not included in the peer group average ongoing charges
ratio.

Risk Management

The Board is responsible for managing the risks faced by the Company. Through
delegation to the Audit Committee, the Board has established procedures to
manage risk, to review the Company’s internal control framework and to establish
the level and nature of the principal risks the Company is prepared to accept in
order to achieve its long-term strategic objective. The Board, meeting as the
Audit Committee, has carried out a robust assessment of the principal and
emerging risks facing the Company with the assistance of the AIFM. A process has
been established to identify and assess risks, their likelihood and the possible
severity of their impact.

These principal risks are set out below with a high-level summary of their
management through mitigation and arrows to indicate any change in assessment
during the year. The risks faced by the Company have been categorised under
three headings as follows:

· Investment and financial risks
· Strategic risks
· Operational risks

Strategic Review Risk

The Board launched a strategic review towards the end of the year following
changes to the Company’s portfolio management arrangements during the year. The
Board considers that this process has heightened the Company’s overall risk
environment, introducing uncertainty regarding the Company’s future structure,
investment approach and management arrangements. This uncertainty may influence
market sentiment and contribute to volatility in the share price and discount.
The review has also necessitated a pause in the Company’s marketing activities,
and the Portfolio Manager has been asked to limit portfolio turnover while the
process is ongoing. The eventual outcome of the review may not align with the
preferences of all shareholders. The Board continues to monitor these risks and
will maintain open communication with stakeholders throughout the process.

A summary of these risks and their mitigation is set out below:

Principal Mitigation Change in risk assessment
Risks and
Uncertainties over the last financial year
Investment
and Financial
Risks
Market and Unchanged
Foreign
Exchange Risk
The Company’s To an extent,
portfolio is this risk is
exposed to accepted as
fluctuations being
in market inherent to
prices (from the Company’s
both activities.
individual However, the
security Board has set
prices and limits in the
foreign investment
exchange policy which
rates) in the ensure that
regions and the portfolio
sectors in is
which it diversified,
invests. reducing the
Emerging risks
markets in associated
the Asia with
Pacific individual
region, in stocks and
which the markets.
portfolio Compliance
companies with the
operate, are investment
expected to objective and
be more policy limits
volatile than is monitored
developed daily by
markets. Frostrow and
the Portfolio
Manager and
reported to
the Board
monthly. The
Portfolio
Manager
reports at
each Board
meeting on
the
performance
of the
Company’s
portfolio,
including the
impact of
wider market
trends and
events.

As part of
its review of
the viability
of the
Company, the
Board also
considers the
sensitivity
of the
Company to
changes in
market prices
and foreign
exchange
rates (see
note 14), how
the portfolio
would perform
during a
market
crisis, and
the ability
of the
Company to
liquidate its
portfolio if
the need
arose.
Further
details are
included in
the Going
Concern and
Viability
Statements.
Investment
Performance
Increased
Investment To manage
performance this risk,
may not the Board:
achieve the
Company’s · reviews
investment and
objective. challenges
The Portfolio reports from
Manager’s the Portfolio
investment Manager,
strategy and which cover
approach is portfolio
expected to composition,
lead to asset
performance allocation,
that will concentration
deviate from and
that of both performance
market at each Board
indices and meeting;
other · reviews
investment investment
companies performance
investing in over the long
the Asia term against
Pacific the Company’s
Region. performance
objective and
peer group;
· monitors
the Portfolio
Manager’s
performance
against set
KPIs; and
· formally
reviews the
Portfolio
Manager’s
appointment,
including
their
performance,
service
levels and
contractual
arrangements,
each year.
The Board
increased the
investment
performance
risk rating
during the
year in light
of the
Company’s
short and
medium term
performance.
InDecember
2025, the
Board
initiated a
full
strategic
review, as
described in
the Chair’s
Statement.

Principal Risks Mitigation Change in assessment of risk over the last
and financial year
Uncertainties
Strategic Risks
Geopolitical
Risk
Increased
Geopolitical The Board
events may have regularly
an adverse discusses
impact on the global
Company’s geopolitical
performance by issues and
causing general
exchange rate economic
volatility, conditions and
changes in tax developments.
or regulatory
environments, a Political
reduced changes in
investment recent years,
universe and/or particularly in
a fall in the US and Asia
market prices. Pacific region
and more
recently in the
Middle East, as
well as Ukraine
and
EasternEurope,
have increased
uncertainty and
volatility in
financial
markets.
TheBoard
discusses such
developments
and how they
may impact
decision making
with the
Portfolio
Manager. In
light of recent
events in Iran,
the Board
considers that
this risk has
increased.
Climate Change Unchanged
Risk
The Board is The Board
cognisant of regularly
risks arising reviews global
from climate environmental,
change and the geopolitical
impact climate and economic
change events developments
could have on with the
portfolio Portfolio
companies and Manager and the
their implications of
operations, as these risks and
well as on events on
service portfolio
providers to construction
the Company. and the
Company’s
operations.
Given the
Portfolio
Manager’s focus
on
sustainability,
the Board
considers the
portfolio to be
relatively well
positioned in
this regard.
Black Swan Risk Unchanged
A significant The Board
unpredictable monitors
event (e.g. a emerging risks
pandemic/war/clo and the
sure of a major robustness of
shipping route) the Portfolio
could lead to Manager and
increased other service
market providers’
volatility, and business
in a worst-case continuity
scenario, major plans.
global trade
and supply The Portfolio
chain breakdown Manager’s
resulting in investment
significant approach
volatility/decli includes a
nes in market focus on
prices. The sustainability
Company’s and
service stewardship,
providers and which
their emphasises
operational quality
systems may investments
also be with strong
affected. balance sheets,
a proven track
record in
previous
crises, and the
protection of
shareholders’
funds, leaving
them relatively
well positioned
to deal with
unforeseen
events.

All of the
Company’s
service
providers are
required to
have business
continuity /
disaster
recovery
policies and
test them at
least annually.
Service
providers
provide updates
on contingency
plans for
coping with
major
disruption to
their
operations.
Principal Risks Mitigation Change in assessment of risk over the last
and financial year
Uncertainties
Key Persons Increased
Risk
There is a risk The Board
that the team manages this
responsible for risk by:
managing the
Company’s · receiving
portfolio may regular reports
leave their from the
employment or Portfolio
may be Manager,
prevented from including any
undertaking significant
their duties. changes in the
make-up of the
portfolio
management
team;
· meeting the
wider team
supporting the
designated lead
manager, atboth
Board meetings
and at the
Portfolio
Manager’s
offices; and
· delegating
to the
Engagement &
Remuneration
Committee
responsibility
to perform an
annual review
of the service
received from
the Portfolio
Manager,
including,
inter alia, the
team supporting
the lead
manager and
their
succession
planning.

In light of the
changes made by
First Sentier
Group to the
Company’s
portfolio
management
arrangements
during the
year, the Board
recognised that
this risk had
increased
materially.
Share Price Increased
Risk
The Company is In managing
exposed to the this risk the
risk, Board:
particularly if
the investment · reviews the
strategy and Company’s
approach are investment
unsuccessful, objective and
that the policy, and the
Company Portfolio
underperforms Manager’s
its peer group, investment
fails to approach, in
achieve its relation to
Performance investment
Objective and performance,
becomes market and
unattractive to economic
shareholders, conditions and
resulting in a the performance
widening of the of the
share price Company’s
discount to the peers;
NAV per share. · regularly
discusses the
Company’s
future
development and
strategy;
· undertakes
a regular
review of the
level of the
share price
discount/premium
to the NAV per
share and
considers ways
in which share
price
performance may
beenhanced,
including the
effectiveness
of marketing,
share issuance
and share
buybacks, where
appropriate;
and
· reviews an
analysis of the
shareholder
register at
each Board
meeting and is
kept informed
of shareholder
sentiment.

In view of the
Company’s
performance,
the changes to
the portfolio
management
team, and
ongoing
developments in
the investment
trust sector,
the Board
considered that
this risk had
increased
during the
year. As a
result, the
Board launched
a strategic
review as
described in
the Chair’s
Statement.
Principal Risks Mitigation Change in risk assessment over the last
and financial year
Uncertainties
Operational
Risk
Operational Increased
Risk
As an To manage these
externally risks the
managed Board:
investment
trust, the ·
Company is periodically
reliant on the visits all key
systems of its service
service providers to
providers for gain a better
dealing, trade understanding
processing, of their
administration, control
financial environment,
andother and the
functions. If processes in
such systems place to
were to fail or mitigate any
be disrupted disruptive
(including, for events;
example, as a · receives a
result of cyber monthly report
-crime or a from Frostrow,
pandemic) this which includes,
could lead to a inter alia,
failure to confirmation of
comply with compliance with
applicable applicable laws
laws, and
regulations and regulations;
governance · reviews
requirements internal
and/or to a control reports
financial loss. and key
policies of its
Credit risk service
arising from providers,
the use of including
counterparties disaster
forms part of recover
this risk. If a procedures and
counterparty business
were to fail, continuity
the Company plans;
could be · maintains a
adversely risk matrix
affected with details of
through either the risks to
delay in which the
settlement or Company is
loss of assets. exposed, the
approach to
managing those
risks, the key
controls relied
upon and the
frequency of
the controls
operation;
· receives
updates on
pending changes
to the
regulatory and
legal
environment and
progress
towards the
Company’s
compliance with
such changes;
· has
considered the
increased risk
of cyber
-attacks and
received
reports and
assurance from
the Company’s
service
providers
regarding the
information
security
controls
inplace;
· has
reviewed the
arrangements
(including sub
-custodial
arrangements)
and services
provided by the
Custodian to
ensure that the
security of the
Company’s
custodial
assets is
maintained; and
· reviews the
Portfolio
Manager’s
approved list
of
counterparties,
the process for
monitoring and
adding to the
approved
counterparty
list, and the
Company’s use
of those
counterparties.

Under the terms
of the contract
with J.P.
Morgan Chase
Bank, the
Company’s
investments are
required to be
segregated from
J.P. Morgan
Chase Bank’s
own assets.

Further
information on
credit risk and
other financial
risks can be
found in note
14.

The Board
considered that
the risk of
operational
disruption had
increased
during the year
as a result of
the strategic
review
initiated by
the Board.

Emerging Risks

Emerging risks are discussed as part of the risk review process. The Board has
identified the following emerging risk:

As well as offering investment opportunities, the development and exploitation
of technological breakthroughs, such as artificial intelligence, may challenge
and damage the addressable market, revenue and operations of portfolio companies
to the extent that they no longer offer the promise of returns consistent with
the Company’s investment objective.

Going Concern

As set out in more detail in the Chairman’s Statement, the Board is in the
process of completing a strategic review of the Company’s future. The possible
outcomes of the strategic review represent a material uncertainty which may cast
significant doubt on the Company’s ability to continue as a going concern.
Notwithstanding this material uncertainty, the Board has concluded that it
remains appropriate to prepare the financial statements on a going concern
basis. In reaching this conclusion, the Board has come to the view that, as the
Board has not yet reached a decision and the Company is considered solvent in
all other regards, going concern remains the most appropriate basis for
preparation of the financial statements.

The Board has also considered the Company’s portfolio, investment activity, cash
balances and revenue forecasts, and a detailed assessment of the Company’s
ability to meet its liabilities as they fall due, including stress tests which
modelled the effects of substantial falls in portfolio valuations and liquidity
constraints on the Company’s NAV, cash flows and expenses. Further details of
the stress tests and scenarios considered can be found in the Audit Committee
Report and Notes 1 and 14 to the financial statements. Based on the information
available to the Directors at the date of this report, the Directors are
satisfied that the Company has adequate financial resources to continue in
operation for at least the next 12 months from the date of signing this report.

Viability Statement

Notwithstanding the material uncertainty posed by the strategic review, the
Directors have carefully assessed the Company’s financial position and prospects
as well as the principal risks facing the Company and expect that, if the
Company is to continue in its current form, it would be able to continue in
operation and meet its liabilities as they fall due over the next three
financial years. The Board chose a three year horizon to align with the
performance-related tender offer introduced during the year.

To make this assessment and in reaching this conclusion, the Audit Committee
considered the Company’s financial position and its ability to liquidate its
portfolio and meet its liabilities as they fall due and notes the following:

· The portfolio is comprised of investments traded on major international
stock exchanges. Based on historic analysis, it is estimated that approximately
90% of the current portfolio could be liquidated within two weeks (based on
current market volumes with 20% participation);
· The Audit Committee has considered the viability of the Company under
various scenarios, including periods of acute stock market and economic
volatility. In view of the results of these stress tests, the Board has
concluded that it would expect to be able to ensure the financial stability of
the Company through the benefits of having a diversified portfolio of listed and
realisable assets. Further details of the stress tests can be found in Note 1 to
the financial statements;
· With a forecast ongoing charges ratio of 1.0%, the expenses of the Company
are predictable and modest in comparison with the assets and there are no
capital commitments currently foreseen which would alter that position;
· The Board has noted that the Company has consistently retained levels of
cash that are significantly higher than its annual operating expenses;
· The Company has no employees, only non-executive Directors. Consequently it
does not have redundancy or other employment related liabilities or
responsibilities; and
· The closed ended nature of the Company means that, unlike open ended funds,
it does not need to realise investments when shareholders wish to sell their
shares.

By order of the Board

Frostrow Capital LLP
Company Secretary

30 April 2026

Statement of Directors’ Responsibilities

The Directors are responsible for preparing the Annual Report and the financial
statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each
financial year. Under that law they are required to prepare the financial
statements in accordance with United Kingdom Generally Accepted Accounting
Practice, including FRS 102 `The Financial Reporting Standard applicable in the
UK and the Republic of Ireland’.

Under company law, the Directors must not approve the financial statements
unless they are satisfied that they give a true and fair view of the state of
affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the Directors are required to:

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

The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company’s transactions and disclose with
reasonable accuracy at any time the financial position of the Company and enable
them to ensure that the financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the Company and hence
for taking reasonable steps for the prevention and detection of fraud and other
irregularities. The Directors are responsible for ensuring that the Annual
Report and financial statements, taken as a whole, are fair, balanced, and
understandable and provide the information necessary for shareholders to assess
the Company’s performance, business model and strategy.

Under applicable law and regulations, the Directors are also responsible for
preparing a Strategic Report, Directors’ Report, Directors’ Remuneration Report
and Corporate Governance Statement which comply with that law and those
regulations.

The Directors are responsible for ensuring the Annual Report and the financial
statements are made available on the Company’s website, which is maintained by
the Portfolio Manager. 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.

Disclosure of Information to the Auditor

The Directors who held office at the date of approval of this report confirm
that, so far as they are each aware, there is no relevant audit information of
which the Company’s auditor is unaware; and each Director has taken all the
steps that he/she might reasonably be expected 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.

Responsibility Statement of the Directors in respect of the Annual Financial
Report

We confirm that to the best of our knowledge:

· the financial statements, prepared in accordance with the applicable set of
accounting standards, give a true and fair view of the assets, liabilities,
financial position and the return of the Company for the year ended 31 January
2026; and
· the Annual Report includes a fair review of the development and performance
of the business and the financial position of the Company, together with a
description of the principal risks and uncertainties that they face.

We consider the 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.

On behalf of the Board

Andrew Impey
Chair

30 April 2026

Income Statement

for the year ended 31 January 2026

Year ended 31 January 2026 Year ended 31 January 2025
Revenue Capital Total Revenue Capital Total
Notes £’000 £’000 £’000 £’000 £’000 £’000
(Losses)/gains 8 – (9,914) (9,914) – 49,989 49,989
on investments
Exchange – (685) (685) – (414) (414)
differences
Income 2 9,912 – 9,912 9,687 – 9,687
Portfolio
management
and AIFM fees 3 (1,068) (3,204) (4,272) (1,211) (3,634) (4,845)
Other expenses 4 (1,194) – (1,194)) (863) – (863)
Return/(loss) 7,650 (13,803) (6,153) 7,613 45,941 53,554
before
taxation
Taxation 5 (1,074) 2,863 1,789 (1,049) (7,684) (8,733)
Return/(loss) 6,576 (10,940) (4,364) 6,564 38,257 44,821
after taxation
Return/(loss) 7 5.6 (9.3) (3.7) 5.4 31.7 37.1
per share (p)

The Total column of this statement represents the Company’s Income Statement.
The Revenue and Capital columns are supplementary to this and are prepared under
guidance published by the Association of Investment Companies.

All revenue and capital items in the Income Statement derive from continuing
operations.

The Company had no recognised gains or losses other than those shown above and
therefore no separate Statement of Other Comprehensive Income has been
presented.

The accompanying notes are an integral part of these statements.

Statement of Changes in Equity

for the year ended 31 January 2026

Ordinary Capital
share Share redemption Special Capital Revenue
capital premium reserve reserve reserve reserve
Total
Note £’000 £’000 £’000 £’000 £’000 £’000
£’000
At 31 15,120 8,811 1,648 14,572 415,270 9,398
464,819
January 2024
Return after – – – – 38,257 6,564
44,821
taxation
Repurchase (46) – 46 – (1,361) –
(1,361)
of own
shares for
cancellation
Ordinary 6 – – – – – (4,838)
(4,838)
dividends
paid
At 31 15,074 8,811 1,694 14,572 452,166 11,124
503,441
January 2025
(Loss)/Return – – – – (10,940) 6,576
(4,364)

after
taxation
Repurchase (791) – 791 – (22,498) –
(22,498)
of own
shares for
cancellation
Ordinary 6 – – – – – (5,805)
(5,805)
dividends
paid
At 31 14,283 8,811 2,485 14,572 418,728 11,895
470,774
January 2026

The accompanying notes are an integral part of these statements.

Statement of Financial Position

as at 31 January 2026

2026 2025
Notes £’000 £’000 £’000 £’000
Fixed assets
Investments 8 472,553 510,203
Current assets
Debtors 9 261 1,252
Cash 4,838 8,028
5,099 9,280
Creditors (amounts 10 (1,455) (2,397)
falling due within one
year)
Net current assets 3,644 6,883
Total assets less 476,197 517,086
current liabilities
Creditors (amounts
falling due after one
year)
Provision for 11 (5,423) (13,645)
liabilities
Net assets 470,774 503,441
Capital and reserves
Called up share capital 12 14,283 15,074
Share premium account 8,811 8,811
Capital redemption 15 2,485 1,694
reserve
Special reserve 15 14,572 14,572
Capital reserve 15 418,728 452,166
Revenue reserve 15 11,895 11,124
Equity shareholders’ 470,774 503,441
funds
Net asset value per 13 412.0p 417.5p
Ordinary Share (p)

The financial statements were approved and authorised for issue by the Board of
Directors on 30 April 2026 and signed on its behalf by:

Andrew Impey

Chair

The accompanying notes are an integral part of these statements.

Pacific Assets Trust Public Limited Company – Company Registration Number:
SC091052 (Registered in Scotland)

Notes to the Financial Statements

1. Accounting Policies

A summary of the principal accounting policies adopted is set out below or as
appropriate within the relevant note to the financial statements.

(a) Basis of Accounting

These financial statements have been prepared under UK Company Law, FRS 102 `The
Financial Reporting Standard applicable in the UK and Ireland’, and in
accordance with guidelines set out in the Statement of Recommended Practice
(«SORP»), published in July 2022, for Investment Trust Companies and Venture
Capital Trusts issued by the Association of Investment Companies, the historical
cost convention, as modified by the valuation of investments at fair value
through profit or loss.

The Company has taken advantage of the exemption from preparing a Cash Flow
Statement under FRS102, as it is an investment fund whose investments are
substantially highly liquid, carried at fair (market) value and provides a
statement of changes in equity.

The Board is of the opinion that the Company is engaged in a single segment of
business, namely investing in accordance with the Investment Objective, and
consequently no segmental analysis is provided.

Going concern

The Directors are required to make an assessment of the Company’s ability to
continue as a going concern and have concluded that the Company has adequate
resources to continue in operational existence for at least 12 months from the
date these financial statements were approved.

In making this assessment, the Directors have considered a wide variety of
emerging and current risks to the Company, as well as the mitigation strategies
that are in place. The Board has also reviewed stress-testing and scenario
analyses prepared by the AIFM. The stress tests and scenario analyses considered
the effect of various downturns, based on historic bear markets, on the asset
value and expenses of the Company. The tests modelled the impact of decreases of
up to and over 80% on the value of the investment portfolio and decreases in
current market liquidity of up to 80%.

These tests are carried out as an arithmetic exercise, which can apply equally
to any set of circumstances in which asset value and income are significantly
impaired. It was concluded that even in an extreme downside scenario, the
Company would be able to continue to meet its liabilities as they fell due.
Whilst the economic future is uncertain, the opinion of the Directors is that
there is no foreseeable downside scenario that would threaten the Company’s
ability to continue to meet its liabilities as they fall due.

Based on the information available to the Directors at the time of this report,
including the results of the stress tests and scenario analyses, and having
taken account of the liquidity of the investment portfolio, the Company’s cash
flow and borrowing position (the Company is not currently geared), the Directors
are satisfied that the Company has adequate financial resources to continue in
operation for at least 12months from the date of signing these financial
statements and that, accordingly, it is appropriate to adopt the going concern
basis.

The Board is in the process of carrying out a strategic review of the Company’s
future. The possible outcomes of the strategic review represent a material
uncertainty which may cast significant doubt on the Company’s ability to
continue as a going concern. Notwithstanding this material uncertainty, the
Board has concluded that it remains appropriate to continue to prepare the
financial statements on a going concern basis. In reaching this conclusion, the
Board has come to the view that, as the Board has not yet reached a decision and
the Company is considered solvent in all other regards, going concern remains
the most appropriate basis for preparation of the financial statements. The
financial statements do not include any adjustments that would be necessary if
the Company were unable to continue as a going concern.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of the financial statements involves judgement in determining
the functional currency; however, there are no significant judgements or key
sources of estimation uncertainty requiring disclosure under FRS 102.

The Company’s investments are made in foreign currencies, however the Board
considers the Company’s functional currency to be sterling. In arriving at this
conclusion, the Board considered that the shares of the Company are listed on
the London Stock Exchange, it is incorporated in the United Kingdom and pays
dividends and expenses in sterling.

Presentation of the Income Statement

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

(b) Foreign Currencies

Transactions denominated in foreign currencies are translated into sterling at
the exchange rates on the date of the transaction. Monetary assets and
liabilities denominated in foreign currencies are translated at the rate ruling
at the date of the Statement of Financial Position. Profits or losses on the
translation of foreign currency balances, whether realised or unrealised, are
taken to the capital or revenue column of the Income Statement, depending on
whether the gain or loss is of a capital or revenue nature.

All values are rounded to the nearest thousand pounds (£’000) except where
otherwise indicated.

(c) Cash

Cash is defined as cash at bank and cash equivalents that are readily
convertible to known amounts of cash and subject to insignificant risk of
changes in value.

2. Income

2026 2025
£’000 £’000
Overseas dividends 9,763 9,469
Interest income 149 218
9,912 9,687

Dividends receivable are recognised on the ex-dividend date. Where no ex
-dividend date is quoted, dividends are recognised when the Company’s right to
receive payment is established. Overseas dividends are gross of withholding tax.

Where the Company has elected to receive its dividends in the form of additional
shares rather than cash the amount of cash foregone is recognised in the revenue
column with any excess above this recognised in the capital column.

3. Portfolio Management and AIFM Fees

2026 2025
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Portfolio management fee 939 2,818 3,757 1,075 3,227 4,302
AIFM fee 129 386 515 136 407 543
1,068 3,204 4,272 1,211 3,634 4,845

Frostrow’s AIFM fee is for risk management, corporate management, company
secretarial and administrative services. Further information regarding FSI’s and
Frostrow’s fees can be found on pages 40 and 41 of the Annual Report.

All expenses and interest are accounted for on an accruals basis. Expenses and
interest are charged to the Income Statement as revenue items except where
incurred in connection with the maintenance or enhancement of the value of the
Company’s assets and taking account of the expected long-term returns, when they
are split as follows:

    Portfolio Management and AIFM fees payable have been allocated 25% to
revenue and 75% to capital.

    Transaction costs incurred on the purchase and sale of investments are
taken to the Income Statement as a capital item, within gains on investments
held at fair value through profit or loss.

4. Other Expenses

2026 2025

£’000 £’000
Directors’ fees 209 215
Employers NIC on directors’ remuneration 16 16
Auditor’s remuneration for annual audit 51 48
Depository fees 59 70
Custody fees 172 195
Registrar fees 42 28
Broker fees 263 45
Listing fees 26 25
Legal and professional fees 57 26
Other expenses 299 195
Total expenses 1,194 863

For accounting policy, see note 3.

5. Taxation

(a) Analysis of (Credit)/Charge in the Year

2026 2025
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Overseas taxation 1,211 – 1,211 1,224 – 1,224
Indian capital gains (137) (2,863) (3,000) (175) 7,684 7,509
tax (credit)/charge
1,074 (2,863) (1,789) 1,049 7,684 8,733

Overseas tax arose as a result of irrecoverable withholding tax on overseas
dividends.

As an investment trust, the Company is generally not subject to UK tax on
capital gains. However, Indian capital gains tax arises on capital gains on the
sale of Indian securities at a rate of 20% on short-term capital gains (defined
as those where the security was held for less than a year) and 12.5% on long
-term capital gains. £7,949,000 of the provision for Indian capital gains (see
note 11) was reversed (2025: £2,439,000 increase) due to the fall in unrealised
long-term capital gains on securities still held. This reversal was offset by
£4,949,000 (2025: £5,070,000) relating to capital gains tax paid on disposals
during the year.

(b) Reconciliation of Tax (Credit)/Charge

The UK corporation tax rate was 25.0% for the year (2025: 25.0%). The tax
assessed for the year is lower than the corporation tax rate. The differences
are explained below.

2026 2025
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Total 7,650 (13,803) (6,153) 7,613 45,941 53,554
return/(loss)
on
ordinary
activities
before
tax
Corporation 1,913 (3,451) (1,538) 1,903 11,486 13,389
tax
charged/(credit
ed) at 25.0%
(2025: 25.0%)
Effects of:
Losses/(gains)
on investment
not subject to
UK corporation – 2,821 2,821 – (12,291) (12,291)
tax
Non-taxable – (171) (171) – (103) (103)
exchange
differences
Unutilised 528 801 1,329 464 908 1,372
management
expenses
Income not (2,441) – (2,441) (2,367) – (2,367)
subject to
corporation
tax
Indian capital (137) (2,863) (3,000) (175) 7,684 7,509
gains tax
(credit)/charge
(see note
5a)
Overseas 1,211 – 1,211 1,224 – 1,224
taxation
Tax 1,074 (2,863) (1,789) 1,049 7,684 8,733
charge/(credit)
for the
year

As at 31 January 2026 the Company had unutilised management expenses and other
reliefs for taxation purposes of £73,780,000 (2025: £68,461,000). It is not
anticipated that these will be utilised in the foreseeable future and as such no
related deferred tax asset has been recognised.

The tax effect of different items of income/gain and expenditure/loss is
allocated between capital and revenue as set out in this note. The standard rate
of corporation tax is applied to taxable net revenue. Any adjustment resulting
from relief for overseas tax is allocated to the revenue reserve.

Deferred tax is recognised in respect of all timing differences that have
originated but not reversed at the Statement of Financial Position date where
transactions or events that result in an obligation to pay more, or right to pay
less, tax in future have occurred at the Statement of Financial Position date.
This is subject to deferred tax assets only being recognised if it is considered
more likely than not that there will be suitable profits from which the future
reversal of the underlying timing differences can be deducted. Timing
differences are differences arising between the Company’s taxable profits and
its results as stated in the accounts which are capable of reversal in one or
more subsequent periods. Deferred tax is measured without discounting and based
on enacted tax rates. Due to the Company’s status as an investment trust, and
the intention to meet the conditions required to obtain approval under Section
1158 of the Corporation Tax Act 2010, the Company has not provided for deferred
UK tax on any capital gains and losses arising on the revaluation or disposal of
investments.

Deferred tax has been provided for on capital gains arising on Indian securities
as noted in 5(a) above.

6. Dividends

Amounts recognised as distributable to shareholders for the year ended 31
January 2026, were as follows:

2026 2025

£’000 £’000
Final dividend paid for the year 5,805 –
ended 31 January 2025 of 4.9p per
share
Final dividend paid for the year – 4,838
ended 31 January 2024 of 4.0p per
share

In respect of the year ended 31 January 2026, a final dividend of 5.7p per share
has been proposed. Details of the ex-dividend and payment dates are provided in
the Chair’s Statement.

The Board’s current policy is to pay dividends only out of revenue reserves.
Therefore the amount available for distribution as at 31 January 2026 is
£11,895,000 (2025: £11,124,000).

The dividends payable in respect of both the current and the previous financial
year, which meet the requirements of Section 1158 CTA 2010, are set out below:

2026 2025

£’000 £’000
Revenue available for 6,576 6,564
distribution by way of dividend
for the year
Final dividend of 5.7p per share (6,513) (5,805)
(2025: final dividend of 4.9p)
Transfer to revenue reserves 63 759

Dividends paid by the Company on its shares are recognised in the financial
statements in the year in which they are paid and are shown in the Statement of
Changes in Equity.

7. Return per Share

The return per share is as follows:

2026 2025
Revenue Capital Total Revenue Capital Total
pence pence pence pence pence pence
Basic 5.6 (9.3) (3.7) 5.4 31.7 37.1

The total return per share is based on the total loss attributable to
shareholders of £4,364,000 (2025: return of £44,821,000).

The revenue return per share is based on the net revenue return attributable to
shareholders of £6,576,000 (2025: £6,564,000).

The capital return per share is based on the net capital loss attributable to
shareholders of £10,940,000 (2025: return of £38,257,000).

The total return, revenue return and the capital return per share are based on
the weighted average number of shares in issue during the year of 117,285,517
(2025: 120,899,602).

The calculations of the returns per Ordinary Share have been carried out in
accordance with IAS 33 Earnings per Share.

8. Investments

2026 2025

£’000 £’000
Investments
Opening cost 372,632 352,944
Opening investment holding gains 137,571 117,165
Opening Valuation 510,203 470,109
Purchases at cost 180,175 123,228
Disposal proceeds (207,911) (133,123)
(Losses)/gains on investments (9,914) 49,989
Valuation at end of year 472,553 510,203
Cost at 31 January 394,742 372,632
Investment holding gains at 31 January 77,811 137,571
Valuation at 31 January 472,553 510,203

The Company received £207,911,000 (2025: £133,123,000) from investments sold in
the year. The book cost of these investments when they were purchased was
£158,065,000 (2025: £103,540,000). These investments have been revalued over
time and until they were sold any unrealised gains/losses were included in the
fair value of the investments.

During the year the Company incurred transaction costs on purchases of £234,000
(2025: £155,000) and transaction costs on sales of £464,000 (2025: £263,000).

Valuation of Investments

Investments are measured initially and at subsequent reporting dates at fair
value. Purchases and sales are recognised on the trade date when a contract
exists whose terms require delivery within the time frame established by the
market concerned. For quoted securities fair value is either bid price or last
traded price, depending on the convention of the exchange on which the
investment is listed. Changes in fair value and gains or losses on disposal are
included in the Income Statement as a capital item.

In addition, for financial reporting purposes, fair value measurements are
categorised into a fair value hierarchy based on the degree to which the inputs
to the fair value measurements are observable and the significance of the inputs
to the fair value measurement in its entirety, which are described as follows:

Level 1 – Quoted prices in active markets.

Level 2 – Inputs other than quoted prices included within Level 1 that are
observable (i.e. developed using market data), either directly or indirectly.

Level 3 – Inputs are unobservable (i.e. for which market data is unavailable).

All investments are in equity shares and have been classified as Level 1 (2025:
All Level 1).

9. Debtors

2026 2025

£’000 £’000
Amounts due from brokers – 1,008
Accrued income 162 179
Other debtors 99 65
261 1,252

10. Creditors: Amounts Falling Due Within One Year

2026 2025

£’000 £’000
Amounts due to brokers – 781
Portfolio management fee 877 1,081
AIFM fee 129 135
Other creditors 449 400
1,455 2,397

11. Provisions for Liabilities

2026 2025

£’000 £’000
Deferred taxation on unrealised 5,423 13,645
capital gains on Indian
securities

See note 5 for further details and accounting policy.

12. Share Capital

2026 2025

£’000 £’000
Allotted and fully paid:
114,262,507 Ordinary shares of 12.5p each (2025: 120,588,386) 14,283 15,074

During the current and prior year, no Ordinary shares were issued. 6,325,879
(2025: 370,000) Ordinary shares were bought back for cancellation.

The capital of the Company is managed in accordance with its investment policy
which is detailed in the Strategic Report.

The Company does not have any externally imposed capital requirements.

13. Net Asset Value Per Share

The net asset value per share of 412.0p (2025: 417.5p) is calculated on net
assets of £470,774,000 (2025: £503,441,000) divided by 114,262,507 (2025:
120,588,386) shares, being the number of shares in issue at the year end.

14. Financial Instruments

The Company’s financial instruments comprise its investment portfolio, cash
balances, and debtors and creditors that arise directly from its operations. As
an investment trust, the Company holds an investment portfolio of financial
assets in pursuit of its investment objective.

Fixed asset investments (see note 8) are valued at fair value in accordance with
the Company’s accounting policies. The fair value of all other financial assets
and liabilities is represented by their carrying value in the Statement of
Financial Position.

The main risks that the Company faces arising from its financial instruments
are:

(i)      market risk, including:

–         other price risk, being the risk that the value of investments will
fluctuate as a result of changes in market prices;

–         interest rate risk, being the risk that the future cash flows of a
financial instrument will fluctuate because of changes in interest rates;

–         foreign currency risk, being the risk that the value of financial
assets and liabilities will fluctuate because of movements in currency rates;

(ii)     credit risk, being the risk that a counterparty to a financial
instrument will fail to discharge an obligation or commitment that it has
entered into with the Company; and

(iii)   liquidity risk, being the risk that the Company will not be able to meet
its liabilities when they fall due. This may arise should the Company not be
able to liquidate its investments. Under normal market trading volumes, the
majority of the investment portfolio could be realised within a week.

Other price risk

The management of other price risk is part of the portfolio management process
and is typical of equity investment. The investment portfolio is managed with an
awareness of the effects of adverse price movements through detailed and
continuing analysis with an objective of maximising overall returns to
shareholders. Although derivatives are not currently employed, they may be used
from time to time, with prior Board approval, to hedge specific market risk or
gain exposure to a specific market.

If the investment portfolio valuation rose or fell by 10% at 31 January, the
impact on the net asset value would have been £47.3 million (2025: £51.0
million). The calculations are based on the investment portfolio valuation as at
the respective Statement of Financial Position dates and are not necessarily
representative of the year as a whole.

Interest rate risk

Floating rate

When the Company retains cash balances the majority of the cash is held in
overnight call accounts. The benchmark rate which determines the interest
payments received on cash balances is the bank base rate for the relevant
currency for each deposit.

Foreign currency risk

The Company invests in overseas securities and holds foreign currency cash
balances which give rise to currency risks. Foreign currency risks are managed
alongside other market risks as part of the management of the investment
portfolio. It is currently not the Company’s policy to hedge this risk on a
continuing basis but it can do so from time to time.

Foreign currency exposure:

2026 2025
Investments Cash Debtors Creditors/ Investments Cash Debtors
Creditors/
Provisions
Provisions
£’000 £’000 £’000 £’000 £’000 £’000 £’000
£’000
Indian 113,932 5 63 – 208,458 437 1,061
(13,942)
rupee
Hong Kong 62,677 22 – – 17,927 – –
–
dollar
New 62,215 39 6 – 80,473 – –
–
Taiwanese
dollar
Chinese 53,538 – – – 53,787 – –
–
renminbi
US dollar 32,493 5 – – 6,508 434 –
–
Korean won 31,512 – 94 – 27,060 – 74
–
Singapore 27,626 10 – – 27,286 485 –
–
dollar
Philippine 25,223 – – – 20,251 – –
(484)
peso
Indonesian 22,049 – – – 27,224 – 15
–
rupiah
Japanese 21,612 – – – 23,279 – 29
–
yen
Thai baht 9,020 – – – 9,672 – –
–
Malaysian 6,352 – – – 5,585 – –
–
ringgit
Vietnamese 2,404 – – – – – –
–
dong
Bangladesh 1,900 – – – 2,693 – –
–
taka
Euro – 8 – – – 8 –
–
Total 472,553 89 163 – 510,203 1,364 1,179
(14,426)

At 31 January 2026 the Company had £4,749,000 of sterling cash balances (2025:
£7,096,000).

During the year sterling weakened 9.8% (2025: weakened by 1.1%) against all of
the currencies in the investment portfolio (weighted for exposure at 31
January). If the value of sterling had strengthened against each of the
currencies in the portfolio by 20%, the impact on the net asset value would have
been negative £43.0 million (2025: negative £46.4 million). If the value of
sterling had weakened against each of the currencies in the investment portfolio
by 20%, the impact on the net asset value would have been positive £52.5 million
(2025: positive £56.7 million). The calculations are based on the investment
portfolio valuation and cash balances as at the year end and are not necessarily
representative of the year as a whole.

Credit risk

Credit risk is the risk that a counterparty to a financial instrument will fail
to discharge an obligation or commitment that it has entered into with the
Company. The Portfolio Manager has in place a monitoring procedure in respect of
counterparty risk which is reviewed on an ongoing basis. The carrying amounts of
financial assets best represents the maximum credit risk exposure at the
Statement of Financial Position date, and the main exposure to credit risk is
via the Custodian which is responsible for the safeguarding of the Company’s
investments and cash balances.

At the reporting date, the Company’s financial assets exposed to credit risk
amounted to the following:

2026 2025

£’000 £’000
Cash 4,838 8,028
Debtors 261 1,252
5,099 9,280

All the assets of the Company which are traded on a recognised exchange are held
by J.P. Morgan Chase Bank, the Custodian. Bankruptcy or insolvency of the
Custodian may cause the Company’s rights with respect to securities held by the
Custodian to be delayed or limited. The Board monitors the Company’s risk as
described in the Strategic Report.

The credit risk on cash is controlled through the use of counterparties or banks
with high credit ratings (rated AA or higher), assigned by international credit
rating agencies. Cash is currently held at JP Morgan Chase Bank. Bankruptcy or
insolvency of such financial institutions may cause the Company’s ability to
access cash placed on deposit to be delayed, limited or lost.

Liquidity risk

The Company’s liquidity risk is managed on an ongoing basis by the Portfolio
Manager. Substantially all of the Company’s portfolio would be realisable within
two weeks under normal market conditions. There may be circumstances where
market liquidity is lower than normal. Stress tests have been performed to
understand how long the portfolio would take to realise in such situations. The
Board is comfortable that in such a situation the Company would be able to meet
its liabilities as they fall due.

Capital management policies and procedures

The Company’s capital management objectives are to ensure that it will be able
to continue as a going concern and to maximise the return to its equity
shareholders.

The Company’s policy on gearing and leverage is set out on page 16 of the Annual
Report. The Company had no gearing or leverage during the current or prior year.

The capital structure of the Company consists of the equity share capital,
retained earnings and other reserves as shown in the Statement of Financial
Position.

The Board, with the assistance of the AIFM and the Portfolio Manager, monitors
and reviews the broad structure of the Company’s capital on an ongoing basis.
This includes a review of:

    the need to buy back equity shares, either for cancellation or to hold in
treasury, in light of any share price discount to net asset value per share in
accordance with the Company’s share buy back policy;

    the need for new issues of equity shares, including issues from treasury;
and

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

The Company’s objectives, policies and processes for managing capital are
unchanged from the prior year.

15. Reserves

Capital redemption reserve

This reserve arises when ordinary shares are redeemed by the Company and
subsequently cancelled, at which point the amount equal to the par value of the
ordinary share capital is transferred from the ordinary share capital to the
Capital Redemption Reserve.

Special reserve

The Special Reserve arose following court approval in February 1999 to transfer
£24.2 million from the share premium account.

Capital reserve

The following are accounted for in this reserve: gains and losses on the
disposal of investments; changes in the fair value of investments; and expenses
and finance costs, together with the related taxation effect, charged to capital
in accordance with note 5.

Revenue reserve

The Revenue Reserve reflects all income and expenses that are recognised in the
revenue column of the Income Statement.

Distributable reserves

The Revenue, Special and Capital Reserves are distributable. It is the Board’s
current policy to pay dividends only from the revenue reserve.

16. Related Party Transactions and Transactions with the Managers

The following are considered to be related parties:

    Frostrow Capital LLP (under the Listing Rules only)

    First Sentier Investors (UK) IM Limited (under the Listing Rules only)

    The Directors of the Company.

Details of the relationship between the Company and Frostrow Capital LLP, the
Company’s AIFM, are disclosed on page 41 of the Annual Report. During the year
ended 31 January 2026, Frostrow earned £515,000 (2024: £543,000) in respect of
company management fees, of which £129,000 (2025: 135,000) was outstanding at
the year end.

The Company employs First Sentier Investors (UK) IM Limited as its Portfolio
Manager. Details of this arrangement are disclosed on page 40 of the Annual
Report. During the year ended 31 January 2026, First Sentier earned £3,757,000
(2025: £4,302,000) in respect of portfolio management fees, of which £877,000
(2025: £1,081,000) was outstanding at the year end.

All material related party transactions have been disclosed in notes 3 and 4.
Details of the remuneration and the shareholdings of all Directors can be found
on page 52 of the Annual Report.

The figures and financial information for 2025 are extracted from the published
Annual Report for the year ended 31 January 2025 and do not constitute the
statutory accounts for that year. The Annual Report for the year ended 31
January 2025 has been delivered to the Registrar of Companies and included the
Independent Auditor’s Report which was unqualified and did not contain a
statement under either section 498(2) or section 498(3) of the Companies Act
2006.

The figures and financial information for 2026 are extracted from the Annual
Report and financial statements for the year ended 31 January 2026 and do not
constitute the statutory accounts for the year.  The Annual Report for the year
ended 31 January 2026 includes the Independent Auditor’s Report which is
unqualified and does not contain a statement under either section 498(2) or
section 498(3) of the Companies Act 2006.  The Annual Report and financial
statements for the year ended 31 January 2026 have not yet been delivered to the
Registrar of Companies.

ANNOUNCEMENT ENDS

Neither the contents of the Company’s website nor the contents of any website
accessible from hyperlinks on the Company’s website (or any other website) is
incorporated into, or forms part of, this announcement.

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