Schroders Capital Global Innovation Trust plc - INOV H2 2025 Earnings Report

Schroders Capital Global Innovation Trust plc - INOV EPS Results

• Actual EPS: -GBX 0.24
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Schroders Capital Global Innovation Trust plc - INOV Revenue Results

• Actual Revenue: $0.21 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Schroders Capital Global Innovation Trust plc - INOV Announcement Details

• Quarter: H2 2025
• Date: 4/2/2026
• Time: N/A
• Conference Call Date: Tuesday, March 31, 2026
• Conference Call Time: 2:00AM ET

Schroder UK Public Private Trust plc specializes in investments in startups, midsize, middle market and large stage, early stage and mature stage investments. The fund primarily invests in the healthcare, financials, industrials, technology, consumer goods, telecommunications, basic materials, and biotechnology sector. It seeks to invest in quoted and unquoted companies. It primarily invests in companies incorporated in the United Kingdom or traded on a London Stock Exchange market but can invest in Europe, United States and Asia other countries. The fund seeks to become a significant shareholder in the portfolio companies.

Schroders Capital Global Innovation Trust plc - INOV H2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: The company's NAV per share rose 11.5% to GBP 0.2223 for the year and the share price climbed 38.2%, reflecting strong mark-to-market performance in 2025.
• Positive Sentiment: Under the agreed managed wind‑down the company returned about GBP 37m in 2025 via repurchases and plans to return a further GBP 18m in H1 2026.
• Positive Sentiment: Several high‑value realizations materially helped returns, notably the sale of Araris (>$400m upfront, >8x multiple and further milestones), the Anthos and Securiti transactions, and an uplift from Revolut’s GBP 75bn up‑round.
• Negative Sentiment: The portfolio is highly concentrated in private equity (98%) with mostly minority, illiquid stakes, and management now says they do not expect material additional realizations before 2028, limiting near‑term liquidity.
• Neutral Sentiment: The fund ended 2025 with ~GBP 24m cash (north of GBP 30m after a subsequent realization) while reserving ~GBP 13m to support portfolio follow‑ons and operating costs under the wind‑down plan.

Presentation

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

Hello, ladies and gentlemen. Thank you for joining us today for the investment update for the Schroders Capital Global Innovation Trust annual report and accounts for 2025. My name is Harry Raikes, and I'm Co-Portfolio Manager of the fund, here to give you an update on the fund, the portfolio, and the year 2025. To get started, I'm gonna cover four broad areas, covering a few marks in terms of headline things for 2025. We'll then go in on the financial performance for the year, some updates on some of the companies in the portfolio and their key developments. Then finally, the outlook on the fund, and some expectations for 2026 and beyond.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

Firstly, on the introduction, the company reported a NAV per share of GBP 0.2223 as of 31 December 2025. That's an increase of 11.5% relative to the same time last year. I wanted to remind shareholders that following the shareholder approval of the discontinuation resolution in February, the company has proceeded with the implementation of its managed wind down. During the course of last year, the company returned GBP 37 million to shareholders via the repurchase and cancellation of shares, an increase from GBP 30 million.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

As you'll see contained in the annual report and accounts, which I would encourage shareholders to look through in their own time and is available on the Schroders website, that the Board has announced the anticipation to return another GBP 18 million of capital to shareholders over the first half of 2026. The other thing I wanted to remind shareholders about is really the principles of the managed wind down that was agreed last year. These were the three key tenets that we mentioned at that time and are core components of the revised investment policy and objective. Firstly, to maximize exit value. Our focus as manager is on maintaining or increasing the value of the portfolio and not pursuing short-term, value destructive opportunities.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

Related to that, our focus is on supporting, not forcing exit events with the companies in the portfolio. The portfolio is made up of minority investments, so non-controlling stakes in a lot of these companies that are not freely tradable as unquoted investments. We have to work with those companies in order to achieve liquidity events. Finally, prudent reserving. As a portfolio with many early stage companies, we are managing the cash balance of the fund to ensure the portfolio remains in a strong position. We have sufficient capital to support those companies through further financing needs to protect the fund's position, but also reserve for the ongoing operating costs and potential unforeseen circumstances that may affect the portfolio overall. Into financial performance for 2025.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

During the course of the year, as I mentioned, the NAV per share increased by 11.5%, from GBP 0.1994 per share to GBP 0.2223. Over that same time period, the share price increased by 38.2% from GBP 0.11 to GBP 0.152 per share. The right of this slide also gives the overview in terms of the total NAV. Shareholders will notice the decline in the overall NAV between Q2 and Q3 2025, and this relates to the repurchase and cancellation of shares that I mentioned in the introduction, which was just over GBP 37 million returned, resulting in the NAV overall declining from GBP 162.4 million to GBP 141.2 million.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

This slide gives a snapshot of that performance relative to performance in previous years. To frame the performance over last year, we also wanted to give you an overview of the performance since the shift towards a managed wind down. We've provided that here since Q3 of 2024, so encapsulating an additional quarter at the end of 2024. At that time, the total value of investments in the portfolio stood at GBP 136.9 million. Since that time, we've made GBP 6 million of follow-on investments in the existing portfolio and achieved a GBP 14.8 million fair value gain in those investments, but also realized GBP 40 million from the value of the portfolio. Overall, delivering just over a 10% return in that period and realizing just under 30% of that starting NAV.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

We think this is very good performance over that period. The second slide then breaks this down in terms of what that means for the cash balance of the fund. That is obviously important for the capital we then have available to return to shareholders through the managed wind down plan. Over the course of the year since Q3 2024, we made the investments and realizations that I described on the previous slide and repurchased GBP 38.2 million, being the combination of earlier share buybacks and then the GBP 37 million tender offer that was completed in July 2025.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

Effectively, the full amount that we realized through the portfolio was returned to investors, leaving us with GBP 24 million at the end of the year. Now to go in just a bit more on the portfolio. Firstly, on investment activity over the course of the year, and you'll note that on, versus the previous slide, this is purely focused on financial and calendar year 2025. We realized just under GBP 36 million from within the portfolio. We made no new investments, and that is fully aligned with the managed wind down plan agreed with shareholders. We made follow-on investments in existing companies in the portfolio of GBP 5 million.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

That primarily related to existing commitments that the fund had in several of the life sciences portfolio companies, and included a relatively meaningful conversion of a convertible loan in Araris, which is a company we exited during the year, that I'll go into a lot more detail in a later slide. On the portfolio side, we had various sale events and some encouraging uplifted valuations for several of the companies. I'll come into several of these marked with a star in subsequent slides. We had the sale of Araris to Taiho Pharmaceutical. We had a significant strategic investment into AI Company Two. AI Company Two, we don't disclose the name here due to confidentiality, but that is a company operating in the artificial intelligence space.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

We had the sale of Securiti AI to Veeam Software, the sale of Anthos Therapeutics to Novartis, and we had the uplifted funding round of Revolut, and we also had an uplifted funding round for AI Company One, another artificial intelligence company in the portfolio. On the negative side, we had markdowns to the valuation of AgroStar, to reflect the terms of its latest financing. We also had down valuations to companies including Ada Health, Genomix and Federated Wireless to reflect both the latest developments within those companies, but also broader market context around those businesses. This slide gives an overview of the attribution analysis for the performance of the portfolio over the 2025 period. The...

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

As I said, the net asset value, the decline from GBP 162.4 million down to GBP 141.2 million, reflecting the repurchase of shares over that period. Actually the portfolio at an underlying level was up GBP 17 million in terms of the fair value gains on the portfolio, and that was principally driven by Araris Biotech, the exit that I'll talk about in more detail within the life sciences sub-strategy. We also had positive contributions from the growth and venture portfolios, and then a small negative contribution from the public investment in Autolus Therapeutics. This slide gives an overview of the portfolio at the year-end. A few things to draw out on this page. First, that the two largest holdings by some margin now are Atom Bank and Revolut.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

On the right of the page here, the portfolio is now highly concentrated in private equity. 98% of the portfolio is in private equity, with one remaining holding on the public equity side, which is Autolus Therapeutics. Finally, the bottom of the table on the left-hand side of this page, we have GBP 24 million in cash, which I will talk to you later in the context of planned further capital return to shareholders. A quick update in terms of some of the investments made by Schroders Capital, since we started making new investments within this portfolio in 2021. Over that period, we've completed 19 investments that are split across the growth, venture and life sciences sub-strategies.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

The most important events to call out within this portfolio that reiterate some of the things I mentioned earlier is the partial exit of AI Company Two, the sale of Securiti AI to Veeam Software that I'll come to in more detail, the substantial realization of Araris Biotech at north of 8x multiple of the capital that we invest in that company, and then finally, also the sale of Anthos Therapeutics.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

This portfolio overall is marked at just over 30% more than the amount we had invested within it, having returned in terms of the percentage of the amount back from those investments as a percentage of the amount we had originally invested now standing at 48%, which is very strong in the context of investments made since the 2021 period relative to other portfolios that we also manage. I'm now gonna go into a bit more detail on four of these key companies within the portfolio that have had major events during the course of 2025. The first of those, as I've mentioned, is a company called Araris Biotech.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

This is a business that is developing next generation antibody drug conjugates to treat cancer, powerful biopharmaceuticals that are designed to deliver toxic drugs specifically to the cancer cells that save healthy tissue within the body, and they're currently developing two clinical candidates for the treatment of breast cancer, non-small cell lung cancer, and also ovarian cancer. This is a company we invested in back in Q3 of 2022, a company based in Switzerland. This is a business that we backed based on the very strong potential that we saw in both the science and the clinical proof that they'd already demonstrated, but also, the excitement about this, area of pharma development, more broadly.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

During the course of 2025 in Q1, we announced the sale of this company to Taiho Pharmaceutical, where the company was sold for an overall amount of $400 million upfront, with $740 million in milestone payments that may be due to us in the coming years based on specific milestone triggers. This has generated over an 8x multiple of the capital that we invested with the potential subject to successful completion of those milestones that would increase in time, and hence why there is still a small remaining value for this holding within the portfolio. The second company that I'll mention that was also a sale during 2025 is Anthos Therapeutics. This is a company developing therapeutics for patients with cardiovascular disease.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

This was also an investment from 2022, a U.S. company, that we invested in alongside Blackstone Life Sciences, and they are developing a treatment for one of the most common heart rhythm disorders. The company, during the course of 2025, was acquired by Novartis for an upfront payment of $925 million, with the potential for additional regulatory and sales-based milestone payments of just over $2 billion. That's achieved a 1.4x multiple on the capital we've invested to date, with the potential through those additional milestone payments, if those are successful, that the multiple will rise to closer to 3x the amount that we had originally invested. The third company, that's also a partial exit for 2025, is Securiti AI.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

This is an investment from Q4 of 2024, so relatively recent and within the venture strategy of the overall portfolio. It's a U.S. company that is developing a data platform for managing of privacy, security, governance, and compliance services of data within enterprise organizations. We backed this company because it had an exceptional founder, had a very strong position in the market given its unique capabilities, providing an end-to-end solution for its customers, and also the mission-critical nature of the software that they're providing in terms of data sovereignty and control. We're also investing alongside a close partner of ours, Mayfield Fund. This was an investment that was partially sold. The company itself was sold to Veeam Software for $1.75 billion in October of last year.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

Part of the consideration for that sale was paid in cash and hence an exit proceeds received by this fund. Also we received stock issued in Veeam Software, the acquirer that now remains in the portfolio, with the plan for that to be realized over the course of the managed wind down process. As a result, this position is now marked at just over a 2x multiple of the capital that we had originally invested. Finally, by no means least, Revolut, which is a highly disruptive U.K.-founded and headquartered global neobank and the second-largest holding in the fund now. The company announced its FY 2025 results earlier in March of this year, 2026. The company has been growing exceptionally strongly.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

They grew retail customers 30% to GBP 68 million. They increased revenues 46% to GBP 4.5 billion. They generated GBP 1.7 billion in profit before tax, while also progressing to secure their U.K. banking license and filing their U.S. banking application. The culmination of all of that great progress at an underlying level resulted in the company raising a substantial up round at a GBP 75 billion valuation, which resulted in this holding being marked up in the portfolio and now very firmly in the position of the second-largest holding overall. Finally, on outlook, as mentioned, our focus as managers is very much on returning capital to shareholders in a timely and efficient manner.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

The Board has announced in the annual report the intention to return an additional GBP 18 million of capital to be paid out through the first half of this year. This has been enabled through both the GBP 24 million of cash and money market funds held in the fund at the end of 2025, but also the realization of Bluewater Bio, a holding within the Salica Environmental Technologies Fund, that places the fund's overall cash balance and money market funds balance at north of GBP 30 million, and making this distribution or capital return possible, while allowing the fund to also hold GBP 13 million of reserves for investments and other operating expenses. It's important to mention the key reason why we hold these reserves.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

These reserves are to support the existing portfolio, avoid dilution in the ownership of those companies, if required, in order to protect the economic value held in this fund. To mitigate unforeseen challenges that might result from potential market downturns or periods of underperformance, noting that a number of the holdings in this fund are loss-making early stage companies. Lastly, and this is something that we've learned a lot through our management of this vehicle since 2019, that it's important for investors to have confidence in the fund and its ability to stand behind its portfolio, and therefore, these reserves are particularly important. Finally, I wanted to mention that the Board anticipates that capital will be returned to shareholders by successive tender offers, although other forms of capital return may be considered in time.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

It's expected that these tenders will be undertaken annually with the possibility of further ad hoc tender offers during the year based on the accumulation of cash from realizations within the portfolio. This is something that we as manager and also the Board are very focused on delivering for shareholders. Finally, a few concluding remarks on the fund. Firstly, a reminder that this is a portfolio of minority equity investments in companies where there is no liquid market for our ownership interests. That means that the exit events of these companies are not within our direct control as the portfolio manager of this fund.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

We have to work with the companies and the management teams and Boards in order to position those companies for potential exit events, and that's the work that we continue to pursue on your behalf. Secondly, that exits as and when they do materialize are likely to come from the combination of trade sales and IPOs. As I've described through some of the transactions that have happened during the course of 2025, there may be various forms to these types of transactions, including earn-outs and milestone-based payments that although exit events may be achieved, the timing of the capital coming back to this fund may take a longer period of time, and that's something that we're continually assessing aligned with the managed wind down strategy.

[Harry Raikes, Co-Portfolio Manager at Schroders Capital]

Finally, our latest expectations based on the portfolio and current market conditions is that we do not foresee material realizations within the portfolio until 2028 at this point in time. I'd like to thank shareholders for taking the time to listen to this update. I hope you found it informative. We would always welcome any feedback you have, so please do respond to any communication or get in contact with your Schroders representative. Finally, thank you very much.

Participants

Analysts

• Harry Raikes, Co-Portfolio Manager at Schroders Capital