Buy
Sell
Share Name Share Symbol Market Type Share ISIN Share Description
Cc Japan Income & Growth Trust Plc LSE:CCJI London Ordinary Share GB00BYSRMH16 ORD GBP0.01
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  1.00 0.68% 147.50 146.00 148.50 166,379 16:35:10
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 8.6 7.6 5.0 29.3 199

CC Japan Income & Growth Trust PLC Annual Financial Report

26/02/2021 7:00am

UK Regulatory (RNS & others)


Cc Japan Income & Growth (LSE:CCJI)
Historical Stock Chart


From Feb 2021 to Apr 2021

Click Here for more Cc Japan Income & Growth Charts.

TIDMCCJI

RNS Number : 4288Q

CC Japan Income & Growth Trust PLC

26 February 2021

CC JAPAN INCOME & GROWTH TRUST PLC

LEI: 549300FZANMYIORK1K98

ANNUAL FINANCIAL REPORT ANNOUNCEMENT

INVESTMENT OBJECTIVE

The investment objective of the CC Japan Income & Growth Trust Plc (the "Company") is to provide Shareholders with dividend income combined with capital growth, mainly through investment in equities listed or quoted in Japan.

FINANCIAL INFORMATION

 
                                               As at         As at 
                                          31 October    31 October 
                                                2020          2019 
--------------------------------------  ------------  ------------ 
 Net assets (millions)                      GBP184.4      GBP214.1 
--------------------------------------  ------------  ------------ 
 Net asset value ("NAV") per Ordinary 
  Share ("Share")(1)                          136.8p        158.9p 
--------------------------------------  ------------  ------------ 
 Share price                                  119.5p        150.0p 
--------------------------------------  ------------  ------------ 
 Share price discount to NAV(2)                12.6%          5.6% 
--------------------------------------  ------------  ------------ 
 Ongoing charges(2)                            1.04%         1.06% 
--------------------------------------  ------------  ------------ 
 Gearing (net)(2)                              20.7%         21.7% 
--------------------------------------  ------------  ------------ 
 

(1) Measured on a cum income basis.

(2) This is an Alternative Performance Measure ("APM"). Definitions of APMs used in this report, together with how these measures have been calculated are disclosed in the Annual Report.

PERFORMANCE SUMMARY

 
                                                            For the year to               For the year to 
                                                                 31 October                    31 October 
                                                                       2020                          2019 
                                                                % change(1)                   % change(1) 
----------------------------------------------------  ---------------------  ---------------------------- 
 NAV ex-income total return per Share(2)                             -11.2%                         +9.6% 
----------------------------------------------------  ---------------------  ---------------------------- 
 NAV cum-income total return per Share(2)                            -11.1%                         +9.9% 
----------------------------------------------------  ---------------------  ---------------------------- 
 Share price total return(2)                                         -17.3%                         +0.7% 
----------------------------------------------------  ---------------------  ---------------------------- 
 Tokyo Stock Exchange Price Index 
  ("Topix") total return                                              +0.3%                         +7.2% 
----------------------------------------------------  ---------------------  ---------------------------- 
 Revenue return per Share                                             5.04p                         5.26p 
----------------------------------------------------  ---------------------  ---------------------------- 
 Dividends per Share: 
----------------------------------------------------  ---------------------  ---------------------------- 
 First interim dividend                                               1.40p                         1.40p 
----------------------------------------------------  ---------------------  ---------------------------- 
 Second interim/final dividend                                        3.20p                         3.10p 
----------------------------------------------------  ---------------------  ---------------------------- 
 Total dividends per Share for the 
  year                                                                4.60p                         4.50p 
----------------------------------------------------  ---------------------  ---------------------------- 
 (1) Total returns are stated in GBP sterling, including dividends reinvested. 
  (2) These are APMs. 
  Source: Coupland Cardiff Asset Management LLP - The Company's Factsheet 
  October 2020.                                     Period   Year to   Year to   Year to   Year to 
                                           to       Oct       Oct       Oct       Oct 
                                          Oct      2017      2018      2019      2020 
                                        2016* 
  ---------------------------------  --------  --------  --------  --------  -------- 
   Share price                        122.40p   152.00p   153.00p   150.00p   119.50p 
  ---------------------------------  --------  --------  --------  --------  -------- 
   Share price total return            +23.5%    +27.2%     +2.8%     +0.7%    -17.3% 
  ---------------------------------  --------  --------  --------  --------  -------- 
   NAV per Share                      123.90p   146.00p   148.60p   158.90p   136.80p 
  ---------------------------------  --------  --------  --------  --------  -------- 
   NAV (cum-income) total return 
    per Share                          +24.9%    +20.7%     +4.1%     +9.9%    -11.1% 
  ---------------------------------  --------  --------  --------  --------  -------- 
   Topix Index total return in GBP 
    sterling                           +32.7%    +10.1%     -0.4%     +7.2%     +0.3% 
  ---------------------------------  --------  --------  --------  --------  -------- 
   Revenue return per Share             3.60p     4.06p     4.55p     5.26p     5.04p 
  ---------------------------------  --------  --------  --------  --------  -------- 
   Dividends per Share                  3.00p     3.45p     3.75p     4.50p     4.60p 
  ---------------------------------  --------  --------  --------  --------  -------- 
 
  *Period from the Company's launch on 15 December 2015 to 31 October 2016 
 
 

CHAIRMAN'S STATEMENT

Performance

I am bound to report to fellow Shareholders that your Company has had a difficult year with the progressive investment performance of the first four and a half years since listing in December 2015 derailed by the global COVID-19 pandemic. Over the financial year to 31 October 2020, and measured by total return, the Company's cum-income NAV returned -11.1% in sterling terms, while the Tokyo Stock Exchange Price Index ("Topix") was fractionally positive at +0.3%. The share price, again measured by total return to include dividends, paid over the period, fell by 17.3%. Since inception to 31 October 2020, the Company has recorded a +52.0% sterling NAV total return, while the Topix total return was +59.0%. Over the same period, the share price rose +35.6%, again measured by total return in sterling, including aggregate distributions of 16.1p per share by way of dividends paid to Shareholders.

Our mandate reflects an investment style that, while seeking total return, looks to identify value and yield opportunities and took a battering as markets fell off a cliff during February 2020. This was exacerbated by our structural gearing during the sell off. Adding insult to injury, the portfolio underperformed the immediate bounce as massive co-ordinated global government fiscal and central bank monetary stimulus favoured a rerating of a narrow range of growth stocks focussed on the virtual economy, technology, media and healthcare. These growth companies tend not to pay dividends and consequently fail to score on our Investment Manager's radar. Poor relative and absolute performance saw our share price discount to NAV widen significantly during the year. The Board is wary of buying back shares in this environment, which could be viewed as cosmetic signalling with little efficacy. The Board believes that investment performance and the growth and level of dividend income are paramount in driving the share price rating.

Post Balance Sheet Event - Subscription Shares - a recovery route to potentially grow the Company

When COVID-19 struck, markets fell precipitously, with the Company's share price and NAV declining by 29% and 22%, respectively, through February and March 2020. The Board determined that this represented an opportunity to try and turn this collapse to Shareholders' advantage. The challenge was to find a way to compensate loyal and patient Shareholders for this period of poor performance, whilst not losing sight of the vision to grow the Company, particularly as the prospects for the Japanese stock market remain attractive. The Board and Investment Manager concur in believing that the Japanese economy is poised to be a strong beneficiary of global reflation.

Consequently, on 26th November 2020, the Company announced that it was considering issuing Transferable Subscription Shares ("TSS") as a free 1 for 5 bonus to existing Shareholders. This announcement allowed for wide consultation across a broad spectrum of Shareholders which gave the Board confidence to proceed with the proposals. Accordingly, a Prospectus was published on 22nd January 2021 and a General Meeting was held on 15th February 2021. 99.95% of Shareholders voting approved the requisite Special Resolution including changes to the Articles of Association. Thus, the Company has now issued 26,946,122 TSS to qualifying shareholders on the Register as at 6.00 pm on 15th February 2021. The Subscription Price of GBP1.61 was determined at the close of business on 15th February 2021 and announced on the 16th February 2021. The TSS were admitted to trading on 18th the February 2021 with the ticker CCJS and were quoted at 6p at the close of business on the 19th February 2021.

The TSS may be exercised on quarterly basis with the first exercise date on 31 May 2021 at the Subscription Price and subsequently on the last business day of August, November and February each year until the Subscription rights expire on 28th February 2023. Full details are given in the Prospectus published on 22nd January 2021 and available for reference on the Company's website www. ccjapanincomeandgrowthtrust.com.

Effectively, the TSS gives existing Shareholders a free option into post-COVID-19 Japanese recovery. The Japanese authorities have handled the pandemic competently compared to other countries, including the recent outbreak. It is not unreasonable to expect that a return to pre-COVID-19 normality as a realistic prospect. Forecast corporate earnings are steadily being revised up as Japanese stock analysts, notably conservative, are looking through to the financial years ending 2022 and 2023 forecasting a strong recovery.

The Board appreciates that the bonus TSS have little immediate value. Nevertheless, there is considerable potential upside for TSS holders. Providing that investment performance rebounds: the market value of the TSS should increase. If the share price exceeds the TSS exercise price, this will present an opportunity for TSS holders to either exercise their entitlements into new Ordinary Shares, or to sell their TSS in the market. If all the TSS are exercised, the Company would raise over GBP40 million. Effectively, this represents a deferred rights issue and unlike secondary or tap issues is structured on a pre-emptive basis. A successful outcome would improve market liquidity in the Ordinary Shares, spread costs and potentially attract new investors. If the recovery falters and the portfolio fails to regain its former traction, there is a risk that the TSS could lapse with no monetary value. However, as the TSS are issued for free, existing Shareholders will not lose money.

The overall cost to the Company of the TSS scheme is modest when assessed against the potential benefits. In the investment trust market, where scale matters, increasing the size of the Company is one of your Board's priorities.

Income & Dividend

The revenue account has held up well despite immediate pressures on the Japanese economy where GDP fell 7.8% in the March - June 2020 quarter following a near 10% decline in the two previous quarters. Despite this, we still recorded earnings per share of 5.04p in the year to 31 October 2020, albeit a fall from 5.26p in the previous year. Dislocation from global lockdowns impacted trade and effectively shut down hospitality and tourism, culminating in the postponement of the 2020 Olympics. Tourism has been a significant driver of demand in recent years. We were caught where the portfolio had 14.3% exposure to REITS and a further 12.9% in consumer and service businesses going into the COVID-19 crisis; all previously stable premium dividend payers which cancelled or cut their distributions. Elsewhere, while companies slashed earnings guidance in the pandemic, the dividend picture has been relatively stable with aggregate dividends remarkably now forecast to be flat in the current Japanese financial year to 31 March 2021. Renewed dividend growth is expected in the year to 31 March 2022 and the picture is reasonably healthy, in sharp contrast to other developed markets, notably the UK and Europe, where dividend cancellations and cuts have been severe.

Corporate Japan is cash rich, which augurs well for improving dividend growth as boards and the regulators strive to improve capital efficiency. Improvements in governance and stewardship codes continue to underwrite a more general commitment to stability of dividends and improving pay-out ratios. Those investors looking for equity income should continue to look to Japan. The main risk to the income account is the yen/ GBP cross rate. Shareholders should be aware that we have a currency hedging policy not to hedge, so the level of revenue is potentially at risk from a strengthening of sterling. Conversely, a weaker yen would stimulate Japanese corporate earnings and should boost the portfolio income steam.

The Board declared a second interim dividend of 3.20p per Ordinary Share to be paid on 5th March 2021 to Shareholders on the register as at 5th February 2021. This makes a full year distribution of 4.60p per Ordinary Share (2019: 4.50p). This represents a 2.2% increase on last year's level of distribution, fully covered by revenue. This is the fifth consecutive year of dividend growth for the Company.

Marketing and Shareholder engagement

The Company has retained the services of Kepler to improve distribution to retail investors, particularly through the medium of platforms. Cornerstone acts as our Public Relations agent and continues to develop the Company's media profile. Our website was redesigned during the year to be more user-friendly. Our Investment Manager, Coupland Cardiff Asset Management LLP, has recently employed further senior sales staff, while Peel Hunt, our Brokers, have also broadened their sales coverage with new hires. The Board is conscious that marketing is an integral component of the investment proposition and the Subscription Share issue has given me an opportunity to engage directly with most of our larger Shareholders.

Board constitution

Mark Smith has served as a Director since our listing in 2015 but will not stand for re-election at this year's forthcoming Annual General Meeting. Mark has a full-time senior role at Waverton Investment Management and finds that his duties conflict with the time that he has to devote to his responsibilities as a Director. On behalf of the Board and Shareholders I would like to thank Mark for his service and contribution to the Company.

Annual General Meeting ("AGM")

The Board has been closely monitoring the evolving COVID-19 situation and the safety and security Shareholders and of the Company's service providers is paramount. In compliance with the 'Stay at Home Measures' passed into law in England and Wales on 6 January 2021, the AGM on 26 March 2021 will take place as a closed meeting. Shareholders (other than those required to form the quorum for the AGM) therefore cannot attend the meeting.

There will be an opportunity to ask questions in advance of the AGM. If Shareholders have a question relating to the business of the AGM, they should send it by email to ukfundcosec@PraxisIFM.com. To the extent that it is appropriate to do so, the Company will respond to any questions received in a Q&A which will be posted on the Company's website www.ccjapanincomeandgrowthtrust.com in advance of the AGM. Shareholders should appoint the 'Chair of the meeting' to act as their proxy as any other named person will not be permitted to attend the meeting. Further details on the appointment of a proxy are included in the Notice of AGM.

Outlook

Any return to pre-COVID-19 normality should provide a more fertile investment playing field for our Investment Manager.

Since the Company's year end we have already seen some style rotation back into value and yield, and away from growth stocks, with strong recovery of both our NAV (+12.4%) and share price (+16.3%) as at 31 January 2021, excluding the dividend payable on 5th March 2021.

Markets have already taken succour from the successful development and impending distribution of a range of COVID- 19 vaccines, together with the Biden victory in the US elections; China's economy is picking up smartly, providing stimulus to Japanese exports (20% of their total). With increased focus on security of supply chains in a tariff-ridden, increasingly protectionist world, Japan is an attractive proposition, offering world class industrial solutions in many fields, such as automation and robotics. Critically, Japan also has a stable domestic political environment; the transition of the premiership to Prime Minister Yoshihide Suga after Prime Minister Shinzo Abe's resignation was achieved seamlessly. The new Prime Minister is committed to continuing Abe's legacy reform initiatives and although his and the LDP's popularity has waned, opposition, led by the impressive Mayor of Tokyo, Yuriko Koike, appears to offer a credible alternative in this year's elections due by 22 October 2021, should she decide to stand. Governance is on an improving trend with younger more independent managements buying into better practices boding well for ESG compliance. The Government has launched successive fiscal programmes with a third package worth 30 trillion yen (US $294 billion) to boost spending, critical in the run up to this year's rescheduled Olympics although there is considerable concern that these may be cancelled.

Of course, risks remain, particularly in the area of strained US/China relations. It remains to be seen how the Biden administration approaches diplomatic relations with China, although it appears that an initial improvement is the restoration of communications between Washington and Beijing. China has become more resolute in its foreign policy and there is a strong containment lobby in the Pentagon, so much diplomacy will be required to prevent relations deteriorating further.

The valuation metrics for the Japanese market appear cheap and it is remarkable that foreign investors are so underweight and have actually sold in monetary terms all of the stock they have bought since Shinzo Abe was appointed Prime Minister in 2013. Japanese household savings are still prepared to take foreign exchange risks by buying offshore premium yield products at the expense of ignoring income yield available in their own domestic market. When Warren Buffett took 5% stakes (with options to double the Berkshire Hathaway holding) in five leading trading companies in September 2020, collectively they yielded 4%. This served as a prelude to a return of positive foreign investment flow. M&A activity is also becoming more prevalent as Shareholder activism and private equity funds are targeting asset and cash rich underperforming companies.

The prospects for Japanese investment returns look promising, conditional on the level of global economic demand and a resumption of domestic spending including the reopening of hospitality, travel and tourism. The Board has every confidence that Richard Aston and the team at Coupland Cardiff Asset Management LLP ("CCAM") can get back on track after facing unprecedented challenges last year.

Keeping in touch

Up to date information including the Investment Manager's monthly factsheets can be found on the Company's website www.ccjapanincomeandgrowthtrust.com .

Harry Wells

Chairman

25 February 2021

INVESTMENT MANAGER'S REPORT

Portfolio Review

The COVID-19 pandemic has had a dramatic and well documented impact on the global economy during 2020 and prompted central banks and governments to unleash extraordinary monetary and fiscal stimulus in response. Global equity markets have consequently experienced one of the shortest, sharpest downturns but also the swiftest recovery on record as investors have sought to contend with the near term implications of the healthcare crisis and the longer term risks and opportunities.

The unparalleled nature of the crisis and the reactive corrective measures created a unique and unpredictable set of circumstances. The dispersion in operational performance between different industries has been pronounced and reflected in stock market trends worldwide as they first fell and then rebounded. Many companies in sectors such as financials or industrials have seen share prices fall substantially and have experienced a valuation de-rating, while some in the field of information technology, e-commerce and healthcare have been identified as beneficiaries, with share prices reaching new highs.

These trends had a negative impact on the performance of the Company in the twelve month reporting period and this has undermined the positive record since launch. The portfolio is constructed on the basis of bottom-up analysis and the attributes of the individual companies. However, this does result in inherent, but known, biases. At the beginning of the year the Company held exposure towards some cyclical companies, selected financials, real estate and beneficiaries of discretionary spending on leisure and travel, all consistent with the analysis of the respective companies and their prospects identified at that time. The severe measures imposed to counter the spread of the virus hit many of these industries particularly hard.

For example, the Tokyo Stock Exchange Real Estate Investment Trust ("REIT") Index fell from 2107 to 1100 in less than 10 trading days in March 2020. The impact of the rapid decline of valuations of this asset class has had the greatest negative impact on the returns of the Company during our last financial year. Notably the impact on Japan Hotel REIT and Invincible Investment, two significant long term holdings in the Company's portfolio, was more severe than even the aggregate index as their accommodation facilities were forced, in effect, to suspend operations, creating unforeseen and unprecedented challenges to their businesses. The exposure in the office segment, through Invesco Office REIT, Star Asia Investment and MC-UBS MidCity Investment, were also significant detractors from performance as office workers were encouraged to avoid commuting.

The impact of restrictions on face-to-face meetings and place-to-place movement has been dramatic and affected hitherto robust businesses. The share price performance of the cosmetics manufacturers Kao, Pola Orbis and Noevir has suffered as demand has been disrupted by the disappearance of tourists and a tendency for lower consumption in an environment where people go out less and frequently wear masks.

The challenges to companies such as Bridgestone, Tsubaki Nakashima and Canon following the closure of production facilities across the globe and the dislocation of consumer demand resulted in uncertainties and hurdles that threatened commitments to a stable shareholder policy. In some cases, the need to manage liquidity and conserve resources took precedence over shareholder returns and resulted in dividend cuts. However, in stark contrast to their international peers who were forced to cut or restrict dividend payments at the request of governments or regulators, Japanese banks and insurance companies were allowed to grow their shareholder returns during the year and demonstrate the opportunity for further growth despite the headwinds they currently face. These stocks have not yet been rewarded for this and suffered de-ratings comparable to the international peer group.

The rapidly evolving developments and outlook prompted swift action in the portfolio, with turnover rising to levels much higher than in previous years. Our visits to Japan before the global spread of the virus highlighted some possible risks and resulted in the sale of a number of holdings which we believed to be most exposed at the time. These included Canon, Resona Holdings and Mabuchi Motor. This was followed by the sales of Pola Orbis, Komatsu, Tokyo Century Leasing, Daiwa House and Bridgestone as the full implications of the international lockdowns became apparent. The primary aim of this portfolio restructuring was to focus on companies more resilient in the face of the changing consumer behaviour and business practices, while taking into consideration the widely varying valuations as equity markets remained volatile.

New positions were established in GLP-REIT, whose portfolio of state-of-the art logistics facilities, are benefitting from the upturn in e-commerce demand, Hoya, the leading optical technology company; Japan Exchange Group, operator of the Tokyo Stock Exchange, Denso, a leading auto parts manufacturer; Fujitsu, the restructuring electronics group; Nitto Denko, manufacturer of components and chemicals used in the production of electronic devices; Technopro, outsourced engineering employment services; Dip, job advertisement for part time workers and Aoyama Zaisan Networks, whose services include inheritance tax solutions. While a diverse list, these companies have all demonstrated their clear commitment to shareholders with favourable dividend or share buyback announcements in the last few months and these new holdings have contributed positively to performance.

In these very challenging markets, some of the long term holdings fared well. Technology suppliers Tokyo Electron and Shin-Etsu Chemical were major positives along with Shoei, where demand for motorcycle helmets has experienced a notable increase from the work from home trend in many countries. West Holdings, which is engaged in the design, manufacture and operation of solar energy generation facilities, was the best performer in the portfolio and greatest single contributor to performance in the last twelve months. This company is likely to be a major beneficiary of Prime Minster Suga's ambitious goal of achieving a carbon neutral economy by 2050.

The positives, while significant in number, were not sufficient to offset the large negative contribution from the concentrated holdings whose business performance and share prices have been dramatically impacted by the COVID-19 crisis.

Despite the challenges faced in the last few months, the investment strategy has been and will remain consistent. The new holdings identified all have the focus on consistent shareholder return which we believe remains a key consideration for long term investors. Some of the fallers will be stronger and better positioned when we return to a more normal environment. We believe we will be rewarded for our patience in continuing to hold our positions in Kao, Noevir and Nippon Parking Development with stable or rising dividends in the near term and a full recovery of revenues, profit and dividend growth in the medium term. In other cases, the decision to sell, as painful as it was, was the correct one, given the tougher post-COVID-19 environment and the better opportunities we have identified elsewhere.

Outlook

Many newspaper column inches were dedicated to Prime Minister Abe's decision to resign his position on health grounds in August 2020. This raised questions as to whether 'Abenomics' will survive or undergo a change of tack under the new Prime Minister Yoshihide Suga. Our view has been that the policies and initiatives of Prime Minister Abe will long outlast his tenure as leader. To name but a few: lower corporate tax rates, increase in employment, the Stewardship Code, the Corporate Governance Code, the rejigging of the Government Pension Investment Fund ("GPIF") and the overhauling of duty free and visa rules which launched a tourist boom in Japan, all policies that will survive on the basis of the widespread support they enjoy, and the tangible benefits experienced since their introduction. Consistency has become even more likely given that his successor was a close associate of the former Prime Minister during his leadership and has been an architect of some of the policies. Suganomics is consequently likely to differ from Abenomics only in name.

Even with the cyclical downturn created by the COVID-19 pandemic, we believe the structural changes which have resulted in steady underlying improvements in corporate governance are continuing. The proposed buyout of NTT DoCoMo (Japan's largest listed subsidiary) by parent company Nippon Telegraph and Telephone, is one example of significant changes to corporate ownership, all driven by the objective of improving both capital efficiency and business prospects (there are over 600 companies listed on TOPIX that have a controlling listed shareholder - approx. 17% of the market). With a further review of the Corporate Governance Code scheduled for the spring 2021 and the restructuring of the Tokyo Stock Exchange primary indices expected in April 2022 look set to continue.

2020 has presented a considerable challenge to our strategic objectives despite firm evidence that the underlying premise of strengthening corporate governance is very much intact. Consequently, we believe that Japanese equities continue to offer an attractive opportunity for investors looking for total shareholder return. Despite the temporary downturn, the recent commitment to shareholder returns from the majority of Japanese companies stands in stark contrast to their previous behaviour during periods of operational weakness and compares favourably to other parts of the world where dividend cuts have been severe. The more cautious approach to balance sheet management and previous levels of lower distribution compared to other international developed markets have afforded most Japanese companies greater latitude when faced with this tough economic reality. This has delivered much of the more robust shareholder return profile we had expected.

However, the nature of this present crisis has been an unfortunate surprise, with many unique and unprecedented aspects undermining the performance of the Company in the early part of this year and reversing the gains since inception of the Company. Whilst the outlook undoubtedly remains uncertain and different to what seemed likely at the beginning of the year, the core philosophy of investing in high quality, well managed and reasonably priced companies with longer term growth prospects should continue to benefit Shareholders. The goal remains to deliver a rising level of dividend distribution which reflects the attractive overall financial standing of Japanese companies amidst the improving corporate governance environment, while capturing capital growth that, in normal circumstances, can be expected to accompany this.

Richard Aston

Coupland Cardiff Asset Management LLP

25 February 2021

INVESTMENT POLICY, RESULTS AND OTHER INFORMATION

Investment policy

The Company intends to invest in equities listed or quoted in Japan. The Company may also invest in exchange traded funds in order to gain exposure to such equities. Investment in exchange traded funds shall be limited to not more than 20 per cent. of Gross Assets at the time of investment. The Company may also invest in listed Japanese real estate investment trusts ("J-REITs").

The Company may enter into long only contracts for difference or equity swaps for gearing and efficient portfolio management purposes.

No single holding (including any derivative instrument) will represent more than 10 per cent. of Gross Assets at the time of investment and, when fully invested, the portfolio is expected to have between 30 to 40 holdings, although there is no guarantee that this will be the case and it may contain a lesser or greater number of holdings at any time.

The Company will have the flexibility to invest up to 10 per cent. of its Gross Assets at the time of investment in unquoted or untraded companies.

The Company will not be constrained by any index benchmark in its asset allocation.

Borrowing policy

The Company may use borrowings for settlement of transactions, to meet on-going expenses and may be geared through borrowings and/or by entering into long only contracts for difference or equity swaps that have the effect of gearing the Company's portfolio to seek to enhance performance. The aggregate of borrowings and long only contracts for difference and equity swap exposure will not exceed 25 per cent. of Net Asset Value at the time of drawdown of the relevant borrowings or entering into the relevant transaction, as appropriate, although the Company's normal policy will be to utilise and maintain gearing to a lower limit of 20 per cent. of Net Asset Value at the time of drawdown of the relevant borrowings or entering into the relevant transaction, as appropriate. It is expected that any borrowings entered into will principally be denominated in Yen.

Hedging policy

The Company does not currently intend to enter into any arrangements to hedge its underlying currency exposure to investment denominated in yen, although the Investment Manager and the Board may review this from time to time.

Results and dividend

The Company's revenue return after tax for the financial year amounted to GBP6,796,000 (2019: GBP7,003,000). In July 2020, the Company paid an interim dividend of 1.40p (2019: 1.40p) per Ordinary Share. On 14 January 2021 the Directors declared a second interim dividend for the year ended 31 October 2020 of 3.20p (2019: 3.10p) per Ordinary Share, which will be paid on 5 March 2021 to Shareholders on the register at 5 February 2021. The Company made this dividend declaration earlier than last year due to the planned issue of Subscription Shares, as announced on 26 November 2020. Therefore, the total dividend in respect of the financial year to 31 October 2020 will be 4.60p (2019: 4.50p) per Ordinary Share.

The Company made a capital loss after tax of GBP30,499,000 (2019: capital gain of GBP12,735,000). Therefore, the total loss after tax for the year was GBP23,703,000 (2019: profit of GBP19,738,000).

Key performance indicators ("KPIs")

The Board measures the Company's success in attaining its investment objective by reference to the following KPIs:

(i) Long term capital growth

The Board considers the Company's Net Asset Value ("NAV") total return figures to be the best indicator of performance over time and this therefore is the main indicator of performance used by the Board. The NAV total return for the year to 31 October 2020 was -11.1% (2019: +9.9%) and the NAV total return from the Company's inception in December 2015 to 31 October 2020 was +52.0% (2019: +69.7%).

The Chairman's Statement incorporates a review of the highlights during the year. The Investment Manager's Report gives details on investments made during the year and how performance has been achieved.

(ii) Revenue return per Share and dividends

The Company's revenue return per Ordinary Share based on the weighted average number of shares in issue during the year was 5.04p (2019: 5.26p). The Company's proposed total dividend payable in respect of the year ended 31 October 2020, including an interim dividend of 1.40p per Ordinary Share paid on 24 July 2020 and a second interim dividend of 3.20p payable on 5 March 2021, is 4.60p (2019: 4.50p) per Ordinary Share.

(iii) Discount/premium to NAV

The discount/premium relative to the NAV per share represented by the share price is closely monitored by the Board. The share price closed at a 12.6% discount to the NAV as at 31 October 2020 (2019: 5.6% discount). This is addressed in the Chairman's Statement.

(iv) Control of the level of ongoing charges

The Board monitors the Company's operating costs carefully and growing the Company offers many benefits, since not all costs scale with assets under management. This is reflected in the continued reduction of the Company's ongoing charges ratio. Based on the Company's average net assets for the year ended 31 October 2020, the Company's ongoing charges figure calculated in accordance with the AIC methodology was 1.04% (2019: 1.06%).

Other information

Modern slavery disclosure

Due to the nature of the Company's business, being a company that does not offer goods or services to consumers, the Board considers that it is not within the scope of modern slavery. The Board considers the Company's supply chains, dealing predominately with professional advisers and service providers in the financial service industry, to be a low risk issue.

Greenhouse Gas Emissions and Streamlined Energy and Carbon Reporting ("SECR")

The Company has no employees, physical assets, property or operations of its own, does not provide goods or services and does not have its own customers. It follows that the Company has little to no direct environmental impact. In consequence, the Company has limited greenhouse gas emissions to report from its operations aside from Directors' travel to board meetings, nor does it have responsibility for any other sources of emissions under the Companies Act 2006 (Strategic Report and Directors' Reports) Regulations 2013. As the Company has no material operations and therefore has little energy use, it falls below the threshold to produce an energy and carbon report. The Company's ESG policy is contained in the Annual Report.

Employees

The Company has no employees. As at 31 October 2020, the Company had five Directors, comprising four male (80%) and one female (20%). The Board's policy on diversity is contained in the Corporate Governance Report in the Annual Report.

Anti-bribery and corruption

It is the Company's policy to conduct all of its business in an honest and ethical manner. The Company takes a zero-tolerance approach to bribery, corruption and tax evasion and is committed to acting professionally, fairly and with integrity in all its business dealings and relationships wherever it operates. Taking account of the nature of the Company's business and operations, the Board has adopted policies and procedures that allow it to have reasonable assurance that persons associated with the Company are prevented from engaging in bribery or corruption for and on behalf of the Company.

Prevention of the facilitation of Tax Evasion

In response to the implementation of the Criminal Finances Act 2017, the Board has adopted a zero-tolerance approach to the criminal facilitation of tax evasion.

Viability statement

The Directors have assessed the viability of the Company for the period to 31 October 2025 (the "'Period") taking into account the long term nature of the Company's investment strategy and the principal risks and emerging risks. The Board has chosen a five year period to assess the Company's viability because of the expected long term nature of equity investment, the Manager's holding period and the fact that the investment objective is unlikely to change significantly over this period. Based on this assessment, the Directors have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the Period.

Notwithstanding the foregoing, the continuation of the Company is subject to approval by Shareholders at the Annual General Meeting to be held in 2022, and if passed, every three years thereafter.

In their assessment of the prospects of the Company, the Directors have considered each of the principal and emerging risks and uncertainties and the liquidity and solvency of the Company. The Directors have considered the Company's income and expenditure projections and the fact that the Company's investments comprise readily realisable securities which could, if necessary, be sold to meet the Company's funding requirements. Portfolio activity and market developments are discussed at quarterly Board meetings. The internal control framework of the Company is subject to a formal review on at least an annual basis.

The Directors do not expect there to be any material increase in the annual ongoing charges of the Company over the Period. The Company's income from investments and cash realisable from the sale of its investments provide substantial cover to the Company's operating expenses, and any other costs likely to be faced by the Company over the Period of their assessment.

The Chairman's Statement and Investment Manager's Report present a positive long term investment case for Japanese equities, which also underpins the Company's viability for the Period.

This assessment has included a detailed review of the issues arising from the COVID-19 pandemic as discussed in the Chairman's Statement, the Investment Manager's Report and in the Principal and emerging risks and uncertainties.

Outlook

The outlook for the Company is discussed in the Chairman's Statement.

Strategic Report

The Strategic Report was approved by the Board of Directors on 25 February 2021.

RISK AND RISK MANAGEMENT

Principal and emerging risks and uncertainties

The Board is responsible for the management of risks faced by the Company and delegates this role to the Audit and Risk Committee. The Audit and Risk Committee carries out, at least annually, a robust assessment of principal and emerging risks and uncertainties and monitors the risks on an ongoing basis. The Committee has a dynamic risk management register in place to help identify key risks in the business and oversee the effectiveness of internal controls and processes.

The risk management register and associated risk heat map provide a visual reflection of the Company's identified principal and emerging risks. These fall into four categories; strategic and business risk, financial risk, operational risk, and regulatory and compliance risk. The Committee considers both the impact and the probability of each risk occurring and ensures appropriate controls are in place to reduce risk to an acceptable level.

During the year, the Committee were particularly concerned with the risks posed by the COVID-19 pandemic which has had a significant impact in all risk categories. In addition to implementing more regular reviews of investment performance with the Investment Manager, the Committee requested and received assurances from its key service providers that they would be able to maintain high standards of service whilst working remotely. Further information on how the Committee has considered COVID-19 when assessing its effect on the Company's ability to operate as a going concern and the Company's longer-term viability can be found in the Annual Report.

The principal and emerging risks, together with a summary of the processes and internal controls used to manage and mitigate risks where possible are outlined below.

 
 Principal Risks                              Mitigation 
 Poor investment performance                  The Investment Manager has a well-defined 
  The Company's investment performance         investment strategy and process which 
  depends on the Investment Manager's          is regularly and rigorously reviewed 
  ability to identify successful               by the Board. The Board monitors the 
  investments in accordance with               Company's investment performance against 
  the Company's investment policy.             its peer group over a range of periods. 
                                               Whilst the Company does not have a benchmark, 
                                               the Board measures performance for reference 
                                               purposes against the Topix and High Yield 
                                               Indices. At each meeting, the Board discusses 
                                               the Japanese investment environment. 
                                               The Manager reports on the composition 
                                               of the portfolio, any recent sales and 
                                               purchases, and expectations of dividend 
                                               income. 
                                               The Company's investment policy states 
                                               that no single holding will represent 
                                               more than 10 per cent. of the Company's 
                                               Gross Assets at the time of investment 
                                               and the portfolio has between 30 and 
                                               40 holdings. 
                                               An investment management contract is 
                                               in place which defines the duties and 
                                               responsibilities of the Investment Manager. 
                                               Safeguards include the provision to terminate 
                                               the Management Agreement with 6 months' 
                                               notice and in line with AIC guidance, 
                                               the Investment Manager's appointment 
                                               is considered on an annual basis. 
                                             ------------------------------------------------- 
 Currency Risk                                The currency risk is explained to shareholders 
  The Company's investments are                in the prospectus and the annual and 
  denominated in Japanese yen.                 interim reports. The Board regularly 
  Changes in the Yen / Sterling                reviews the level of foreign currency 
  exchange rate may impact returns             exposure and monitors forecast revenues. 
  and lead to a devaluation of                 The revenue forecast presented to the 
  the Company's assets. Income                 board includes a yen sensitivity analysis. 
  is received from investee companies          The Company's policy is not to hedge 
  in Yen. Exchange rate fluctuations           against any foreign currency and income 
  could impact distributable income            received from investee companies is translated 
  available for dividends.                     into sterling on receipt. 
                                               The Company has built up a revenue reserve 
                                               and the Board regularly reviews the net 
                                               income available for distribution using 
                                               the Investment Manager's sensitivity 
                                               analysis of revenue estimates. 
                                             ------------------------------------------------- 
 Share price does not reflect                 The Board closely monitors the Company's 
  underlying net asset value ("NAV")           share price relative to NAV and the Company's 
  The market value of the Company's            discount / premium relative to their 
  shares can fluctuate and may                 peer group, and recognises the importance 
  not always reflect their underlying          that investors attach to the ordinary 
  value. Returns achieved are                  shares not trading at a significant discount 
  reliant primarily upon the performance       or premium to the prevailing NAV. 
  of the Company's portfolio and               Should the shares trade at a significant 
  the Company may experience fluctuations      discount to the prevailing NAV, the Board 
  in its operating results due                 could consider whether the Company should 
  to a number of factors. Such                 purchase its own ordinary shares, pursuant 
  variability may lead to volatility           to the general authority renewed at each 
  in the trading price of the                  AGM. 
  Company's shares, in excess                  Conversely the Board will issue new Ordinary 
  of levels acceptable to the                  Shares should the shares trade at a premium 
  Board or shareholders.                       to their prevailing NAV, pursuant to 
                                               the general authority renewed at each 
                                               AGM. 
                                               Extensive marketing is carried out by 
                                               the Company's Investment Manager, Broker 
                                               and a specialist PR company. An investment 
                                               research consultant is engaged to provide 
                                               independent research for retail shareholders. 
                                               Subsequent to the year end, a Special 
                                               Resolution was approved to issue 26,946,122 
                                               Subscription Shares as a 1 for 5 Bonus 
                                               Issue. The Board was also granted the 
                                               authority to repurchase up to 14.99% 
                                               of the issued Subscription Share capital. 
                                             ------------------------------------------------- 
 Market Risk                                   The Directors acknowledge that market 
  Changes in the investment, economic           risk is inherent in the investment process. 
  or political conditions in Japan,             The Company maintains a diversified portfolio 
  and / or in the countries in                  of quoted investments. The Board has 
  which the Company's investee                  imposed guidelines within its investment 
  companies operate could substantially         policy to limit exposure to individual 
  and adversely affect the Company's            holdings and limits the level of gearing. 
  prospects.                                    Further information on financial instruments 
  In addition to changing economic              and risk can be found in note 16 to the 
  factors such as interest rates,               Financial Statements. 
  employment, industry conditions               In addition to regular market updates 
  and competition, unpredictable                from the Investment Manager and reports 
  factors such natural disasters,               at Board meetings, the Board convenes 
  earthquakes and diplomatic events             more often during periods of extreme 
  may impact market risk. Geopolitical          volatility, for example during the COVID-19 
  instability in the region may                 pandemic. 
  threaten global economic growth               The impact on the portfolio from Brexit 
  and, consequently, companies                  and other geopolitical changes including 
  in the portfolio.                             the trade war between the US and China 
                                                are monitored and discussed regularly 
                                                at Board meetings. Market risk also arises 
                                                from uncertainty about the future prices 
                                                of the Company's Japanese equity investments, 
                                                geopolitical and natural disasters. While 
                                                it is difficult to quantify the impact 
                                                of such changes, it is not anticipated 
                                                that they will fundamentally affect the 
                                                business of the Company or make the investment 
                                                case for Japanese equities any less desirable. 
                                                The longer-term effects of the COVID 
                                                -19 pandemic, including the unprecedented 
                                                levels of fiscal stimulus and global 
                                                travel restrictions are unknown. However, 
                                                the Board is encouraged by the scope 
                                                for recovery as Japan emerges from the 
                                                pandemic. 
                                             ------------------------------------------------- 
 Key Person Risk                              The Board meets regularly with other 
  The Company depends on the diligence,        members of the wider team employed by 
  skill and judgment of the Investment         the Investment Manager. The strength 
  Manager's investment professionals           and depth of the investment management 
  and the information and ideas                team provides comfort that there is not 
  they generate during the normal              over-reliance on one person with alternative 
  course of their activities.                  portfolio managers available to act if 
  The Company's future success                 needed. 
  depends on the continued service 
  of key personnel. The departure 
  of any of these individuals 
  without adequate replacement 
  may have a material adverse 
  effect on the Company's business 
  prospects and results of operations. 
-------------------------------------------  ------------------------------------------------- 
 Excess leverage                              An ability to gear is a unique advantage 
  The Company may use borrowings               of closed-end companies and structural 
  to seek to enhance investment                gearing is a clearly stipulated component 
  returns. While this has the                  of the Company's investment policy and 
  potential to enhance investment              is highlighted in shareholder communications. 
  returns in rising markets, in                Gearing is monitored and strict restrictions 
  falling markets the impact could             on borrowings are imposed: gearing continues 
  be detrimental to performance.               to operate within a pre-agreed limit 
                                               of 25% of NAV. 
                                             ------------------------------------------------- 
 Cyber Risk                                   Service providers report on cyber risk 
  The Company's service providers              mitigation and management at least annually, 
  are exposed to the risk of cyber-attacks.    which includes confirmation of business 
  Cyber-attacks could lead to                  continuity capability in the event of 
  disruption to or failure of                  a cyber-attack. Penetration testing is 
  systems and processes provided               carried out by the Investment Manager 
  by the Investment Manager and                and key service providers at least annually. 
  other key service providers, 
  creating an unexpected event 
  and/or adverse impact on the 
  portfolio or personnel. 
                                             ------------------------------------------------- 
 Underperforming key service                  The Board has appointed an experienced 
  providers                                    independent professional Depositary, 
  The Company's service providers              Custodian and Administrator. 
  including the Depositary, the                All key service providers produce annual 
  Custodian and the Administrator              internal control reports for review by 
  could fail to provide accurate               the Audit and Risk Committee. These reviews 
  timely information to the Board.             include consideration of their business 
  External events, such as cyber-crime,        continuity plans and the associated cyber 
  natural disasters or pandemics               security risks. 
  may mean service providers are 
  unable to meet their contractual 
  obligations. 
                                             ------------------------------------------------- 
 Emerging risk 
                                             ------------------------------------------------- 
 Business Interruption due to                 Each service provider has business continuity 
  COVID-19                                     policies and procedures in place to ensure 
  Failure in services provided                 that they are able to meet the Company's 
  by key service providers, meaning            needs and all significant breaches are 
  information is not processed                 escalated to the Board. 
  correctly or in a timely manner,             Due to the COVID-19 pandemic and the 
  resulting in regulatory investigation        restrictions on gatherings and travel 
  or financial loss, failure of                introduced by the UK Government, the 
  trade settlement, or potential               Audit and Risk Committee requested assurances 
  loss of investment trust status              from the Company's key service providers 
                                               that business continuity plans had been 
                                               enacted where necessary, with service 
                                               providers enabling remote working arrangements. 
                                               This provided a satisfactory level of 
                                               assurance that there had not been, and 
                                               there was no expectation of any disruption 
                                               to service quality. The Company has a 
                                               business continuity plan in place. 
                                               Details of the Directors assessment of 
                                               the going concern status of the Company, 
                                               which considered the adequacy of the 
                                               Company's resources and the impacts of 
                                               the COVID-19 pandemic, are given in the 
                                               Directors' Report of the Annual Report. 
                                             ------------------------------------------------- 
 

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

Company law requires the Directors to prepare financial statements for each financial year. Under that law, the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice, including FRS 102 which is The Financial Reporting Standard applicable to the UK and Republic of Ireland and applicable law. 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 as at the end of the year and of the net return for the year. In preparing these financial statements, the Directors are required to:

   --    select suitable accounting policies and then apply them consistently; 
   --    make judgements and estimates, which are reasonable and prudent; 

-- state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

-- prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and which 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 Company Reports and Accounts are published on its website at www.ccjapanincomeandgrowthtrust.com which is maintained by the Company's Investment Manager. The work carried out by the auditors does not involve consideration of the maintenance and integrity of this website and, accordingly, the auditor accepts no responsibility for any changes that have occurred to the financial statements since being initially presented on the website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Directors' confirmation statement

The Directors each confirm to the best of their knowledge that:

(a) the financial statements, prepared in accordance with applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and profit of the Company; and

(b) this Annual Report includes a fair review of the development and performance of the business and position of the Company, together with a description of the principal risks and uncertainties that it faces.

Having taken advice from the Audit and Risk Committee, the Directors consider that the Annual Report and financial statements taken as a whole is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Company's performance, business model and strategy.

For and on behalf of the Board

Harry Wells

Director

25 February 2021

FINANCIAL STATEMENTS

INCOME STATEMENT

FOR THE YEARED 31 OCTOBER 2020

 
                                          Year ended 31 October          Year ended 31 October 
                                                   2020                           2019 
                                      Revenue    Capital      Total   Revenue   Capital     Total 
                               Note   GBP'000    GBP'000    GBP'000   GBP'000   GBP'000   GBP'000 
----------------------------  -----  --------  ---------  ---------  --------  --------  -------- 
 (Losses)/gains on 
  investments                   3           -   (29,495)   (29,495)         -    14,207    14,207 
 Currency gains/(losses)                    -        302        302         -     (124)     (124) 
 Income                         4       8,553          -      8,553     8,671         -     8,671 
 Investment management 
  fee                           5       (285)    (1,140)    (1,425)     (293)   (1,173)   (1,466) 
 Other expenses                 6       (556)          -      (556)     (434)         -     (434) 
 Return on ordinary 
  activities before 
  finance costs and 
  taxation                              7,712   (30,333)   (22,621)     7,944    12,910    20,854 
 Finance costs                  7        (63)      (166)      (229)      (74)     (175)     (249) 
 Return on ordinary 
  activities before 
  taxation                              7,649   (30,499)   (22,850)     7,870    12,735    20,605 
 Taxation                       8       (853)          -      (853)     (867)         -     (867) 
 Return on ordinary 
  activities after taxation             6,796   (30,499)   (23,703)     7,003    12,735    19,738 
----------------------------  -----  --------  ---------             --------  --------  -------- 
 Return per Ordinary 
  Share                         13      5.04p   (22.64)p   (17.60)p     5.26p     9.57p    14.83p 
----------------------------  -----  --------  ---------  ---------  --------  --------  -------- 
 
 The total column of the Income Statement is the profit and loss account 
  of the Company. All revenue and capital items in the above statement 
  derive from continuing operations. 
 
 Both the supplementary revenue and capital columns are prepared under 
  guidance from the Association of Investment Companies. There is no other 
  comprehensive income and therefore the return for the year is also the 
  total comprehensive income for the year. 
 
 The notes form part of these financial statements. 
 
 

STATEMENT OF FINANCIAL POSITION

AT 31 OCTOBER 2020

 
                                                              31 October         31 October 
                                                                    2020               2019 
                                                     Note        GBP'000            GBP'000 
--------------------------------------------------  -----  -------------  ----------------- 
 Fixed assets 
 Investments at fair value through profit 
  or loss                                             3          180,927            211,240 
--------------------------------------------------  -----  -------------  ----------------- 
 
 Current assets 
 Cash and cash equivalents                                         2,463              2,472 
 Cash collateral paid in respect of contracts 
  for difference ("CFDs")                                             41                 16 
 Amounts due in respect of CFDs                                    3,014              3,258 
 Other debtors                                        10           3,100              2,571 
                                                                   8,618              8,317 
--------------------------------------------------  -----  -------------  ----------------- 
 Creditors: amounts falling due within 
  one year 
 Amounts payable in respect of CFDs                              (4,969)            (5,140) 
 Other creditors                                      11           (216)              (291) 
                                                                 (5,185)            (5,431) 
--------------------------------------------------  -----  -------------  ----------------- 
 Net current assets                                                3,433              2,886 
--------------------------------------------------  -----  -------------  ----------------- 
 Total assets less current liabilities                           184,360            214,126 
--------------------------------------------------  -----  -------------  ----------------- 
 Net assets                                                      184,360            214,126 
--------------------------------------------------  -----  -------------  ----------------- 
 Capital and reserves 
 Share capital                                        12           1,348              1,348 
 Share premium                                                    98,437             98,437 
 Special reserve                                                  64,671             64,671 
 Capital reserve 
   -Revaluation gains on investment held 
    at year end                                       3           14,746             26,156 
   -Other capital reserves                                       (1,578)             17,511 
 Revenue reserve                                                   6,736              6,003 
 Total Shareholders' funds                                       184,360            214,126 
--------------------------------------------------  -----  -------------  ----------------- 
 NAV per share - Ordinary Shares (pence)              14         136.84p            158.93p 
--------------------------------------------------  -----  -------------  ----------------- 
 
 Approved by the Board of Directors and authorised for issue on 25 February 
  2021 and signed on their behalf by: 
 
 Harry Wells 
 Director 
 
 CC Japan Income & Growth Trust plc is incorporated in England and 
  Wales with registration number 9845783. 
 
 
 

The notes form part of these financial statements.

STATEMENT OF CHANGES IN EQUITY

FOR THE YEARED 31 OCTOBER 2020

 
                                         Share      Share    Special    Capital    Revenue 
                                       capital    premium    reserve    reserve    reserve      Total 
                               Note    GBP'000    GBP'000    GBP'000    GBP'000    GBP'000    GBP'000 
----------------------------  -----  ---------  ---------  ---------  ---------  ---------  --------- 
 Balance at 1 November 
  2019                                   1,348     98,437     64,671     43,667      6,003    214,126 
 Return on ordinary 
  activities after taxation                  -          -          -   (30,499)      6,796   (23,703) 
 Dividends paid                 9            -          -          -          -    (6,063)    (6,063) 
 Balance at 31 October 
  2020                                   1,348     98,437     64,671     13,168      6,736    184,360 
----------------------------  -----  ---------  ---------  ---------  ---------  ---------  --------- 
                               There were no Ordinary Shares issued or share buybacks during the year 
                                                                               ended 31 October 2020. 
 For the year ended 31 October 
  2019 
                                         Share      Share    Special    Capital    Revenue 
                                       capital    premium    reserve    reserve    reserve      Total 
                               Note    GBP'000    GBP'000    GBP'000    GBP'000    GBP'000    GBP'000 
----------------------------  -----  ---------  ---------  ---------  ---------  ---------  --------- 
 Balance at 1 November 
  2018                                   1,285     89,911     64,671     30,932      4,116    190,915 
 Return on ordinary 
  activities after taxation                  -          -          -     12,735      7,003     19,738 
 Dividends paid                 9            -          -          -          -    (5,116)    (5,116) 
 Issue of Ordinary 
  Shares                        12          63      8,665          -          -          -      8,728 
 Ordinary Shares issue 
  costs                                      -      (139)          -          -          -      (139) 
 Balance at 31 October 
  2019                                   1,348     98,437     64,671     43,667      6,003    214,126 
----------------------------  -----  ---------  ---------  ---------  ---------  ---------  --------- 
 
 The Company's distributable reserves consist of the Special reserve, 
  Revenue reserve and Capital reserve attributable to realised profits. 
 The notes form part of these financial statements. 
 
 

STATEMENT OF CASH FLOWS

FOR THE YEARED 31 OCTOBER 2020

 
                                                         Year ended    Year ended 
                                                         31 October    31 October 
                                                               2020          2019 
                                                            GBP'000       GBP'000 
-----------------------------------------------------  ------------  ------------ 
 Operating activities cash flows 
 Return on ordinary activities before finance 
  costs and taxation*                                      (22,621)        20,854 
 Adjustment for: 
 Losses/(gains) on investments                               23,290      (12,932) 
 CFD transactions                                                48         (857) 
 Increase in other debtors                                    (380)         (168) 
 (Decrease)/increase in other creditors                        (75)            65 
 Tax withheld on overseas income                              (853)         (867) 
                                                       ------------  ------------ 
 Net cash flow (used in)/from operating activities            (591)         6,095 
-----------------------------------------------------  ------------  ------------ 
 Investing activities cash flows 
 Purchases of investments                                  (92,584)      (38,854) 
 Proceeds from sales of investments                          99,458        30,373 
 Net cash flow from/(used in) investing activities            6,874       (8,481) 
-----------------------------------------------------  ------------  ------------ 
 Financing activities cash flows 
 Issue of Ordinary Share capital                                  -         8,728 
 Payment of Ordinary Share issue costs                            -         (139) 
 Equity dividends paid                                      (6,063)       (5,116) 
 Finance costs paid                                           (229)         (248) 
 Net cash (used in)/flow from financing activities          (6,292)         3,225 
 (Decrease)/increase in cash and cash equivalents               (9)           839 
                                                       ------------  ------------ 
 Cash and cash equivalents at the beginning 
  of the year                                                 2,472         1,633 
 Cash and cash equivalents at the end of the 
  year                                                        2,463         2,472 
-----------------------------------------------------  ------------  ------------ 
 * Cash inflow from dividends was GBP7,396,000 
  (2019: GBP8,506,000). 
  The notes form part of these financial statements. 
 
 

NOTES TO THE ACCOUNTS

 
 1. GENERAL INFORMATION 
 
 CC Japan Income & Growth Trust plc (the "Company") was incorporated 
  in England and Wales on 28 October 2015 with registered number 9845783, 
  as a closed-ended investment company. The Company commenced its operations 
  on 15 December 2015. The Company carries on business as an investment 
  trust within the meaning of Chapter 4 of Part 24 of the Corporation 
  Tax Act 2010. 
 
 The Company's investment objective is to provide Shareholders with dividend 
  income combined with capital growth, mainly through investment in equities 
  listed or quoted in Japan. 
 
 The Company's shares were admitted to the Official List of the Financial 
  Conduct Authority with a premium listing on 15 December 2015. On the 
  same day, trading of the Ordinary Shares commenced on the London Stock 
  Exchange. 
 The Company's registered office is 1st Floor, Senator House, 85 Queen 
  Victoria Street, London, EC4V 4AB. 
 
 2. ACCOUNTING POLICIES 
 The principal accounting policies followed by the Company are set out 
  below: 
 
 (a) Basis of accounting 
 The financial statements have been prepared in accordance with FRS 102 
  ("the Financial Reporting Standard applicable in the UK and Republic 
  of Ireland" issued by the Financial Reporting Council), with the Statement 
  of Recommended Practice "Financial Statements of Investment Trust Companies 
  and Venture Capital Trusts" (issued in October 2019) and the Companies 
  Act 2006. The financial statements have been prepared on the historical 
  cost basis except for the modification to a fair value basis for certain 
  financial instruments as specified in the accounting policies below. 
 They have also been prepared on the assumption that approval as an investment 
  trust will continue to be granted. 
 The financial statements have been prepared on a going concern basis. 
  In forming this opinion, the directors have considered any potential 
  impact of the COVID-19 pandemic on the going concern and viability of 
  the Company. In making their assessment, the Directors have reviewed 
  income and expense projections and the liquidity of the investment portfolio, 
  and considered the mitigation measures which key service providers, 
  including the Manager, have in place to maintain operational resilience 
  particularly in light of COVID-19. 
 The financial statements have been presented in GBP sterling (GBP), 
  which is also the functional currency as this is the currency of the 
  primary economic environment in which the Company operates. The Board 
  having regard to the currency of the Company's share capital and the 
  predominant currency in which it pays distributions, expenses and its 
  shareholders operate, has determined that sterling is the functional 
  currency. Sterling is also the currency in which the financial statements 
  are presented. 
 (b) Investments 
 As the Company's business is investing in financial assets with a view 
  to profiting from their total return in the form of increases in fair 
  value, financial assets are designated as held at fair value through 
  profit or loss in accordance with FRS 102 Section 11: 'Basic Financial 
  Instruments', and Section 12: 'Other Financial Instruments'. The Company 
  manages and evaluates the performance of these investments on a fair 
  value basis in accordance with its investment strategy, and information 
  about the investments is provided on this basis to the Board of Directors. 
 Upon initial recognition investments are designated by the Company "at 
  fair value through profit or loss". They are accounted for on the date 
  they are traded and are included initially at fair value which is taken 
  to be their cost. Subsequently investments are valued at fair value 
  which is the bid market price for listed investments. 
 
 Changes in the fair value of investments held at fair value through 
  profit or loss and gains or losses on disposal are included in the capital 
  column of the income statement within "gains on investments held at 
  fair value". 
 
  (c) Derivatives 
 Derivatives comprise Contracts for Difference ("CFD"), which are held 
  at fair value by reference to the underlying market value of the corresponding 
  security. Where the fair value is positive the CFD is presented as a 
  current asset, and where the fair value is negative the CFD is presented 
  as a current liability. Gains or losses on these derivative transactions 
  are recognised in the Income Statement. They are recognised as capital 
  and are shown in the capital column of the Income Statement if they 
  are of a capital nature and are recognised as revenue and shown in the 
  revenue column of the Income Statement if they are of a revenue nature. 
  To the extent that any gains or losses are of a mixed revenue and capital 
  nature, they are apportioned between revenue and capital accordingly. 
 
 (d) Foreign currency 
 Transactions denominated in foreign currencies including dividends are 
  translated into sterling at actual exchange rates as at the date of 
  the transaction. Assets and liabilities denominated in foreign currencies 
  at the year end are reported at the rates of exchange prevailing at 
  the year end. Foreign exchange movements on investments and derivatives 
  are included in the Income Statement within gains on investments. Any 
  other gain or loss is included as an exchange gain or loss to capital 
  or revenue in the Income Statement as appropriate. 
 
 (e) Income 
 Investment income has been accounted for on an ex-dividend basis or 
  when the Company's right to the income is established. Special dividends 
  are credited to capital or revenue in the Income Statement, according 
  to the circumstances surrounding the payment of the dividend. Overseas 
  dividends are included gross of withholding tax recoverable. 
 Interest receivable on deposits is accounted for on an accrual basis. 
 
 (f) Dividend payable 
 Interim dividends are recognised when the Company pays the dividend. 
  Final dividends are recognised in the period in which they are approved 
  by the shareholders. This year a second interim dividend is being paid 
  in substitution for the final dividend. 
 
 (g) Expenses 
 All expenses are accounted for on an accruals basis and are charged 
  as follows: 
 
  -- the basic investment management fee is charged 20% to revenue and 
  80% to capital; 
  -- CFD finance costs are charged 20% to revenue and 80% to capital; 
  -- investment transactions costs are allocated to capital; and 
  -- other expenses are charged wholly to revenue. 
 
   (h) Taxation 
 The tax expense represents the sum of the tax currently payable and 
  deferred tax. The tax currently payable is based on the taxable profit 
  for the year. Taxable profit differs from net profit as reported in 
  the income statement because it excludes items of income or expenses 
  that are taxable or deductible in other years and it further excludes 
  items that are never taxable or deductible. The Company's liability 
  for current tax is calculated using tax rates that were applicable at 
  the financial reporting date. 
 Where expenses are allocated between capital and revenue any tax relief 
  in respect of the expenses is allocated between capital and revenue 
  returns on the marginal basis using the Company's effective rate of 
  corporation taxation for the relevant accounting period. 
 Deferred taxation is recognised in respect of all timing differences 
  that have originated but not reversed at the financial reporting date, 
  where transactions or events that result in an obligation to pay more 
  tax in the future or right to pay less tax in the future have occurred 
  at the financial reporting 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 
  timing differences can be deducted. Deferred tax assets and liabilities 
  are measured at the rates applicable to the legal jurisdictions in which 
  they arise. 
 
 (i) Other receivables and other payables 
 Other receivables and other payables do not carry any interest and are 
  short term in nature and are accordingly stated at their nominal value. 
 
 (j) Segmental reporting 
 The Directors are of the opinion that the Company is engaged in a single 
  segment of business being that of an investment trust as disclosed in 
  note 1. 
 
 (k) Estimates and assumptions 
 The preparation of financial statements requires the Directors to make 
  estimates and assumptions that affect items reported in the Statement 
  of financial position and Income Statement and the disclosure of contingent 
  assets and liabilities at the date of the financial statements. Although 
  these estimates are based on management's best knowledge of current 
  facts, circumstances and, to some extent, future events and actions, 
  the Company's actual results may ultimately differ from those estimates, 
  possibly significantly. 
 
 There have not been any instances requiring any significant estimates 
  or judgements in the year. 
 
 (l) Cash and cash equivalents 
 Cash comprises cash and demand deposits. Cash equivalents, include bank 
  overdrafts, and short-term, highly liquid investments that are readily 
  convertible to known amounts of cash, are subject to insignificant risks 
  of changes in value, and are held for the purpose of meeting short-term 
  cash commitments rather than for investment or other purposes. 
 
 
 3. INVESTMENTS 
 
 (a) Summary of valuation 
                                                               As at 31      As at 31 
                                                                October       October 
                                                                   2020          2019 
                                                                GBP'000       GBP'000 
-------------------------------------------------------    ------------  ------------ 
 Investments listed on a recognised 
  overseas investment exchange                                  180,927       211,240 
---------------------------------------------------------                ------------ 
                                                                180,927       211,240 
  -------------------------------------------------------  ------------  ------------ 
 (b) Movements 
 In the year ended 31 October 
  2020 
                                                                   2020          2019 
                                                                GBP'000       GBP'000 
-------------------------------------------------------    ------------  ------------ 
 Book cost at the beginning of 
  the year                                                      185,084       174,262 
 Revaluation gains on investments held at beginning 
  of the year                                                    26,156        15,157 
---------------------------------------------------------  ------------  ------------ 
 Valuation at beginning of the 
  year                                                          211,240       189,419 
---------------------------------------------------------  ------------  ------------ 
 Purchases at cost                                               92,584        38,854 
 Sales: 
 - proceeds                                                    (99,607)      (29,965) 
 - (losses)/gains on investment holdings 
  sold during the year                                         (11,880)         1,933 
 Movements in revaluation (losses)/gains on investment 
  held at year end                                             (11,410)        10,999 
---------------------------------------------------------  ------------  ------------ 
 Valuation at end of the year                                   180,927       211,240 
---------------------------------------------------------  ------------  ------------ 
 
 Book cost at end of the year                                   166,181       185,084 
 Revaluation gains on investment 
  held at year end                                               14,746        26,156 
                                                           ------------  ------------ 
 Valuation at end of the year                                   180,927       211,240 
---------------------------------------------------------  ------------  ------------ 
 
 Transaction costs on investment purchases for the year ended 31 October 
  2020 amounted to GBP45,000 (2019: GBP19,000) and on investment sales 
  for the year amounted to GBP48,000 (2019: GBP15,000). 
 
 (c) (Losses)/gains on investments 
                                                             Year ended    Year ended 
                                                             31 October    31 October 
                                                                   2020          2019 
                                                                GBP'000       GBP'000 
-------------------------------------------------------    ------------  ------------ 
 (Losses)/gains on non-derivative investment holdings 
  sold during the year                                         (11,880)         1,933 
 Movements in revaluation (losses)/gains on investment 
  held at year end                                             (11,410)        10,999 
 Other capital losses                                              (31)          (24) 
 Total (losses)/gains on non-derivative investments 
  held at fair value                                           (23,321)        12,908 
---------------------------------------------------------  ------------  ------------ 
 Realised losses on CFD assets 
  and liabilities                                               (6,101)         (231) 
 Unrealised (losses)/gains on CFD assets 
  and liabilities                                                  (73)         1,530 
                                                                         ------------ 
 Total (losses)/gains on investments held at fair 
  value                                                        (29,495)        14,207 
---------------------------------------------------------  ------------  ------------ 
 
 
 4. INCOME 
 
                                      Year ended 31      Year ended 31 
                                       October 2020       October 2019 
                                            GBP'000            GBP'000 
--------------------------------  -----------------  ----------------- 
 Income from investments: 
 Overseas dividends                           8,553              8,670 
 Deposit interest                                 -                  1 
                                  -----------------  ----------------- 
  Total                                       8,553              8,671 
--------------------------------  -----------------  ----------------- 
 Overseas dividend income is translated into sterling on receipt. 
 
 
 5. INVESTMENT MANAGEMENT FEE 
 
                                            Year ended 31      Year ended 31 
                                             October 2020       October 2019 
                                                  GBP'000            GBP'000 
--------------------------------------  -----------------  ----------------- 
 Basic fee: 
 20% charged to revenue                               285                293 
 80% charged to capital                             1,140              1,173 
                                        -----------------  ----------------- 
 Total                                              1,425              1,466 
--------------------------------------  -----------------  ----------------- 
 
 The Investment Manager is entitled to receive a management fee payable 
  monthly in arrears and is at the rate of one-twelfth of 0.75% of Net 
  Asset Value per calendar month. There is no performance fee payable 
  to the Investment Manager. 
 
 
 6. OTHER EXPENSES 
 
                                                Year ended 31     Year ended 31 
                                                 October 2020      October 2019 
                                                      GBP'000           GBP'000 
-------------------------------------------  ----------------  ---------------- 
 Secretarial services                                      48                58 
 Administration and other expenses                        326               382 
 Auditor's remuneration - statutory                        38                36 
 Directors' fees                                          144               141 
 VAT recovered - Revenue*                                   -             (183) 
 Other expenses - Revenue                                 556               434 
-------------------------------------------  ----------------  ---------------- 
 
 * Other expenses for the year ended 31 October 2019 include a credit 
  of GBP183,000 of VAT recovered on the Company's expenses since inception 
  to 31 October 2019. 
 
 
 7. FINANCE COSTS 
 
                                              Year ended 31   Year ended 31 
                                               October 2020    October 2019 
                                                    GBP'000         GBP'000 
-------------------------------------------  --------------  -------------- 
 Interest paid - 100% charged to revenue                 21              30 
 CFD finance cost and structuring fee - 
  20% charged to revenue                                 41              43 
 Structuring fees - 20% charged to revenue                1               1 
                                             --------------  -------------- 
                                                         63              74 
-------------------------------------------  --------------  -------------- 
 CFD finance cost and structuring fee - 
  80% charged to capital                                164             171 
 Structuring fees - 80% charged to capital                2               4 
                                             --------------  -------------- 
                                                        166             175 
-------------------------------------------  --------------  -------------- 
 Total finance costs                                    229             249 
-------------------------------------------  --------------  -------------- 
 
 
 8. TAXATION 
 
                                               Year ended 31 October         Year ended 31 October 
                                                                2020                          2019 
                                       Revenue    Capital      Total   Revenue   Capital     Total 
                                       GBP'000    GBP'000    GBP'000   GBP'000   GBP'000   GBP'000 
------------------------------------  --------  ---------  ---------  --------  --------  -------- 
 (a) Analysis of tax charge in 
  the year: 
 Overseas withholding tax                  853          -        853       867         -       867 
                                      --------  ---------  ---------  --------  -------- 
 Total tax charge for the year 
  (see note 8 (b))                         853          -        853       867         -       867 
------------------------------------  --------  ---------  ---------  --------  --------  -------- 
 
 (b) Factors affecting the tax charge for the year: 
 The Company's effective tax rate for the year is 19.00% (2019: 19.00%), 
  which is same as the standard rate of corporation tax in the UK for a 
  large company currently at 19.00% (2019: 19.00%). 
 
 The differences are explained 
  below: 
                                               Year ended 31 October         Year ended 31 October 
                                                                2020                          2019 
                                       Revenue    Capital      Total   Revenue   Capital     Total 
                                       GBP'000    GBP'000    GBP'000   GBP'000   GBP'000   GBP'000 
------------------------------------  --------  ---------  ---------  --------  --------  -------- 
 Total return before taxation            7,649   (30,499)   (22,850)     7,870    12,735    20,605 
------------------------------------  --------  ---------  ---------  --------  --------  -------- 
 UK corporation tax at 19.00% 
  (2019: 19.00%)                         1,453    (5,795)    (4,342)     1,495     2,420     3,915 
 Effects of: 
 Overseas withholding tax suffered         853          -        853       867         -       867 
 Non-taxable overseas dividends        (1,625)          -    (1,625)   (1,647)         -   (1,647) 
 Capital losses/(gains) not subject 
  to tax                                     -      5,547      5,547         -   (2,676)   (2,676) 
 Finance costs not tax deductible           12         32         44        14        33        47 
 Movement in unutilised management 
  expenses                                 160        216        376       138       223       361 
 Total tax charge                          853          -        853       867         -       867 
------------------------------------  --------  ---------  ---------  --------  --------  -------- 
 
 The Company is not liable to tax on capital gains due to its status as 
  an investment trust. The company has an unrecognised deferred tax asset 
  of GBP562,000 (2019: GBP431,000) based on the long term prospective corporation 
  tax rate of 19% (2019: 19%). This asset has accumulated because deductible 
  expenses exceeded taxable income for the year ended 31 October 2020. 
  No asset has been recognised in the accounts because, given the composition 
  of the Company's portfolio, it is not likely that this asset will be 
  utilised in the foreseeable future. 
 
 
 9. DIVID 
 
 (i). Dividends paid during the financial year 
                                          Year ended 31 October     Year ended 31 October 
                                                           2020                      2019 
-------------------------------------  ------------------------  ------------------------ 
 Final dividend - year ended 
  31 October 2019 
  of 3.10p (2018: 2.50p)                                  4,177                     3,230 
-------------------------------------  --------------  --------  -------------  --------- 
 Interim dividend - year ended 31 October 
  2020 
  of 1.40p (2019: 1.40p)                                  1,886                     1,886 
 Total                                                    6,063                     5,116 
-------------------------------------  --------------  --------  -------------  --------- 
 
 (ii). The dividend relating to the year ended 31 October 2020, which 
  is the basis on which the requirements of Section 1159 of the Corporation 
  Tax Act 2010 are considered is detailed below: 
 
                                         Year ended 31 October     Year ended 31 October 
                                                  2020                      2019 
                                            Pence per                Pence per 
                                             Ordinary                 Ordinary 
                                                share   GBP'000          share    GBP'000 
-------------------------------------  --------------  --------  -------------  --------- 
 Interim dividend                               1.40p     1,886          1.40p      1,886 
 Second interim dividend / final 
  dividend*                                     3.20p     4,311          3.10p      4,177 
                                       --------------  --------  -------------  --------- 
                                                4.60p     6,197          4.50p      6,063 
-------------------------------------  --------------  --------  -------------  --------- 
 
 *Not included as a liability in the year ended 31 October 2020 accounts. 
 
 The Directors have declared a second interim dividend for the financial 
  year ended 31 October 2020 of 3.20p per Ordinary Share. The dividend 
  will be paid on 5 March 2021 to Shareholders on the register at the 
  close of business on 5 February 2021. This year a second interim dividend 
  is being paid in substitution for the final dividend. 
 
 
 10. OTHER DEBTORS 
 
                                      As at 31 October   As at 31 October 
                                                  2020               2019 
                                               GBP'000            GBP'000 
-----------------------------------  -----------------  ----------------- 
 Accrued income                                  2,860              2,556 
 Sales for settlement                              149                  - 
 VAT receivable                                     48                  - 
 Prepayments and other receivables                  43                 15 
                                     -----------------  ----------------- 
                                                 3,100              2,571 
-----------------------------------  -----------------  ----------------- 
 
 
 11. OTHER CREDITORS 
 
                                         As at 31 October   As at 31 October 
                                                     2020               2019 
                                                  GBP'000            GBP'000 
--------------------------------------  -----------------  ----------------- 
 Amounts falling due within one year: 
 Accrued finance costs                                  8                  8 
 Accrued expenses                                     208                283 
--------------------------------------  -----------------  ----------------- 
                                                      216                291 
--------------------------------------  -----------------  ----------------- 
 
 
 12. SHARE CAPITAL 
 
 Share capital represents the nominal value of shares that have been 
  issued. The share premium includes any premiums received on issue of 
  share capital. Any transaction costs associated with the issuing of 
  shares are deducted from share premium. 
 
                                                           As at 31 October              As at 31 October 
                                                                 2020                           2019 
                                                       No of shares       GBP'000     No of shares      GBP'000 
--------------------------------------------------  ---------------  ------------  ---------------  ----------- 
 Allotted, issued & fully paid: 
 Ordinary Shares of 1p 
 Opening balance                                        134,730,610         1,348      128,451,781        1,285 
 Ordinary Shares of 1p issued                                     -             -        6,278,829           63 
                                                    ---------------                ---------------  ----------- 
 Closing balance                                        134,730,610         1,348      134,730,610        1,348 
--------------------------------------------------  ---------------  ------------  ---------------  ----------- 
 
 During the year under review, no Ordinary Shares of 1p each were issued 
  (2019: 6,278,829 Ordinary Shares of 1p each were issued at prices ranging 
  from 138.3p to 144.1p and the total amount raised was GBP8,278,000). 
 
 13. RETURN PER ORDINARY SHARE 
 
 Total return per Ordinary Share is based on the loss on ordinary activities, 
  including income, for the period after taxation of GBP23,703,000 (2019: 
  profit of GBP19,738,000). 
 
 Based on the weighted average number of Ordinary Shares in issue for 
  the year to 31 October 2020 of 134,730,610 (2019: 133,109,302), the 
  returns per Ordinary Share were as follows: 
 
                                          As at 31 October 2020                   As at 31 October 2019 
                                  Revenue        Capital            Total      Revenue     Capital      Total 
------------------------------  ---------  -------------  ---------------  -----------  ----------  --------- 
 Return per Ordinary Share          5.04p       (22.64)p         (17.60)p        5.26p       9.57p     14.83p 
------------------------------  ---------  -------------  ---------------  -----------  ----------  --------- 
 
 
 
 14. NET ASSET VALUE PER SHARE 
 
 Total shareholders' funds and the net asset value ("NAV") per share 
  attributable to the Ordinary Shareholders at the period end calculated 
  in accordance with the Articles of Association were as follows: 
 
                                        As at 31 October     As at 31 October 
                                                    2020                 2019 
 
 Net Asset Value (GBP'000)                       184,360              214,126 
-----------------------------------  -------------------  ------------------- 
 Ordinary Shares in issue                    134,730,610          134,730,610 
-----------------------------------  -------------------  ------------------- 
 NAV per Ordinary Share                          136.84p              158.93p 
-----------------------------------  -------------------  ------------------- 
 
 
 15. RELATED PARTY TRANSACTIONS 
 
 Transactions with the Investment Manager and the Alternative Investment 
  Fund Investment Manager ("AIFM") 
 The Company provides additional information concerning its relationship 
  with the Investment Manager and AIFM, CCAM. The fees for the period 
  are disclosed in note 5 and amounts outstanding at the year ended 31 
  October 2020 were GBP116,000 (2019: GBP136,000). 
 
 Research purchasing agreement 
 MiFID II treats investment research provided by brokers and independent 
  research providers as a form of "inducement" to investment managers 
  and requires research to be paid separately from execution costs. In 
  the past, the costs of broker research were primarily borne by the Company 
  as part of execution costs through dealing commissions paid to brokers. 
  With effect from 3 January 2018, this practice has changed, as brokers 
  subject to MiFID II are now required to price, and charge for, research 
  separately from execution costs. Equally, the new rules require the 
  Investment Manager, as an investment manager, to ensure that the research 
  costs borne by the Company are paid for through a designated research 
  payment account ("RPA") funded by direct research charges to the Investment 
  Manager's clients, including the Company. 
 
 The research charge for the year 1 January 2020 to 31 December 2020, 
  as agreed between the Investment Manager and the Company, was GBP30,000 
  (31 December 2019: GBP29,000). The research charge for the year 1 January 
  2021 to 31 December 2021, as budgeted by the Investment Manager, is 
  GBP28,000. 
 
 Directors' fees and shareholdings 
 The Directors' fees and shareholdings are disclosed in the Directors' 
  Remuneration Implementation Report in the Annual Report . 
 
 
 16. FINANCIAL INSTRUMENTS AND CAPITAL DISCLOSURES 
 Risk Management Policies and Procedures 
 As an investment trust the Company invests in equities and equity related 
  derivatives for the long-term so as to secure its investment objective. 
  In pursuing its investment objective, the Company is exposed to a variety 
  of risks that could result in either a reduction in the Company's net 
  assets or a reduction of the profits available for dividends. 
 These risks include market risk (comprising currency risk, interest 
  rate risk, and other price risk), liquidity risk, leverage risk and 
  credit risk, and the Directors' approach to the management of them are 
  set out as follows. 
 The objectives, policies and processes for managing the risks, and the 
  methods used to measure the risks, are set out below. 
 
 (a) Market Risk 
 Economic conditions 
 Changes in economic conditions in Japan (for example, interest rates 
  and rates of inflation, industry conditions, competition, political 
  and diplomatic events and other factors) and in the countries in which 
  the Company's investee companies operate could substantially and adversely 
  affect the Company's prospects. The Company is subject to concentration 
  risk as it only invests in Japanese companies but has diversified investments 
  across the different sectors in the Japanese market. 
 Sectoral diversification 
 The Company has no limits on the amount it may invest in any sector. 
  This may lead to the Company having significant concentrated exposure 
  to portfolio companies in certain business sectors from time to time. 
 Concentration of investments in any one sector may result in greater 
  volatility in the value of the Company's investments and consequently 
  its NAV and may materially and adversely affect the performance of the 
  Company and returns to Shareholders. 
 Unquoted companies 
 The Company may invest in unquoted companies from time to time. Such 
  investments, by their nature, involve a higher degree of valuation and 
  performance uncertainties and liquidity risks than investments in listed 
  and quoted securities and they may be more difficult to realise. 
 
   Management of market risk 
 The Company is invested in a diversified portfolio of investments. The 
  Company's investment policy states that no single holding (including 
  any derivative instrument) will represent more than 10% of the Company's 
  Gross Assets at the time of investment and, when fully invested, the 
  portfolio is expected to have between 30 to 40 holdings although there 
  is no guarantee that this will be the case and it may contain a lesser 
  or greater number of holdings at any time. A maximum of 10% of the Company's 
  Gross Assets at the time of investment may be invested in unquoted or 
  untraded companies at time of investment. 
 The Investment Manager's approach will in most cases achieve diversification 
  across a number of sectors as shown in the Holdings in Portfolio in 
  the Annual Report. 
 
 (b) Currency risk 
 The majority of the Company's assets will be denominated in a currency 
  other than sterling (predominantly in yen) and changes in the exchange 
  rate between sterling and yen may lead to a depreciation of the value 
  of the Company's assets as expressed in sterling and may reduce the 
  returns to the Company from its investments and, therefore, negatively 
  impact the level of dividends paid to shareholders. 
 Management of currency risk 
 The Investment Manager monitors the currency risk of the Company's portfolio 
  on a regular basis. Foreign currency exposure is regularly reported 
  to the Board by the Investment Manager. The Company does not currently 
  intend to enter into any arrangements to hedge its underlying currency 
  exposure to investment denominated in yen, although the Investment Manager 
  and the Board will keep this approach under regular review. 
 Foreign currency exposures 
 An analysis of the Company's equity investments and CFD that are priced 
  in a foreign currency is: 
                                                                          As at 31        As at 31 
                                                                           October         October 
                                                                              2020            2019 
                                                                           GBP'000         GBP'000 
-------------------------------------------------  ---------  ---------  ---------  -------------- 
 Equity Investments: yen                                                   180,927         211,240 
 Receivables (due from brokers, 
  dividends, and other income 
  receivable)                                                                3,100           2,571 
 CFD: yen (absolute exposure)                                               36,183          42,247 
 Cash: yen                                                                 (1,535)         (1,174) 
                                                                         ---------  -------------- 
 Total                                                                     218,675         254,884 
-------------------------------------------------  ---------  ---------  ---------  -------------- 
 
   Foreign currency sensitivity 
 If the Japanese yen had appreciated or depreciated by 10% as at 31 October 
  2020 then the value of the portfolio as at that date would have increased 
  or decreased as shown below: 
                                                    Increase   Decrease   Increase        Decrease 
                                                     in Fair    in Fair    in Fair         in Fair 
                                                       Value      Value      Value           Value 
                                                    As at 31   As at 31   As at 31        As at 31 
                                                     October    October    October         October 
                                                        2020       2020       2019            2019 
                                                     GBP'000    GBP'000    GBP'000         GBP'000 
-------------------------------------------------  ---------  ---------  ---------  -------------- 
 Impact on capital return - increase/(decrease)       21,868   (21,868)     25,488        (25,488) 
 Total return/(loss) after taxation 
  -                                                   21,868   (21,868)     25,488        (25,488) 
-------------------------------------------------  ---------  ---------  ---------  -------------- 
 
 
 

(c) Leverage risk

 
 Derivative instruments 
 The Company may utilise long only CFDs or equity swaps for gearing and 
  efficient portfolio management purposes. Leverage may be generated through 
  the use of CFDs or equity swaps. Such financial instruments inherently 
  contain much greater leverage than a non-margined purchase of the underlying 
  security or instrument. This is due to the fact that, generally, only 
  a very small portion (and in some cases none) of the value of the underlying 
  security or instrument is required to be paid in order to make such 
  leveraged investments. As a result of any leverage employed by the Company, 
  small changes in the value of the underlying assets may cause a relatively 
  large change in the Net Asset Value of the Company. Many such financial 
  instruments are subject to variation or other interim margin requirements, 
  which may force premature liquidation of investment positions. 
 Borrowing risk 
 The Company may use borrowings to seek to enhance investment returns. 
  While the use of borrowings can enhance the total return on the Ordinary 
  Shares where the return on the Company's underlying assets is rising 
  and exceeds the cost of borrowing, it will have the opposite effect 
  where the return on the Company's underlying assets is rising at a lower 
  rate than the cost of borrowing or falling, further reducing the total 
  return on the Ordinary Shares. As a result, the use of borrowings by 
  the Company may increase the volatility of the Net Asset Value per Ordinary 
  Share. 
 Any reduction in the value of the Company's investments may lead to 
  a correspondingly greater percentage reduction in its Net Asset Value 
  (which is likely to adversely affect the price of an Ordinary Share). 
  Any reduction in the number of Ordinary Shares in issue (for example, 
  as a result of buy backs) will, in the absence of a corresponding reduction 
  in borrowings, result in an increase in the Company's level of gearing. 
 To the extent that a fall in the value of the Company's investments 
  causes gearing to rise to a level that is not consistent with the Company's 
  gearing policy or borrowing limits, the Company may have to sell investments 
  in order to reduce borrowings, which may give rise to a significant 
  loss of value compared to the book value of the investments, as well 
  as a reduction in income from investments. 
 Management of leverage risk 
 The aggregate of borrowings and long only CFD and equity swap exposure 
  will not exceed 25% of Net Asset Value at the time of drawdown of the 
  relevant borrowings or entering into the relevant transaction, as appropriate, 
  although the Company's normal policy will be to utilise and maintain 
  gearing to a lower limit of 20% of Net Asset Value at the time of drawdown 
  of the relevant borrowings or entering into the relevant transaction, 
  as appropriate. It is expected that any borrowings entered into will 
  principally be denominated in yen. 
 The Company's level of gearing as at 31 October 2020 is disclosed in 
  the Alternative Performance Measures section. 
 
 (d) Interest rate risk 
 The Company is exposed to interest rate risk specifically through its 
  cash holdings, the interest payable on the 
  overdraft facility and on positions within the CFD portfolio. Interest 
  rate movements may affect the level of income receivable/payable from 
  any cash at bank and on deposits and overdraft facilities. The effect 
  of interest rate changes on the earnings of the companies held within 
  the portfolio may have a significant impact on the valuation of the 
  Company's investments. Movements in interest rates will also have an 
  impact on the valuation of the CFD derivative contracts. Interest receivable 
  on cash balances or paid on overdrafts is at fixed rate. 
 Management of interest rate 
  risk 
 The possible effects on Fair Value and cash flows that could arise as 
  a result of changes in interest rates are taken into account when making 
  investment decisions. Derivative contracts are not used to hedge against 
  the exposure to interest rate risk. 
 
   Interest income earned on deposits and paid on overdraft by the Company 
   is primarily derived from fixed interest rates, as such do not have 
   a material exposure to interest rate risk. 
 
   The bank overdraft is an integral part of cash management and the Company 
   has a legal right of off set and has the intention to settle this at 
   net. 
 Interest rate exposure 
 The exposure at 31 October 2020 of financial assets and liabilities 
  to interest rate risk is shown by reference to floating interest rates 
  - when the interest rate is due to be reset. No sensitivity analysis 
  is shown as the exposure to interest rate risk is not material in relation 
  to the Company's finance cost and investments in CFDs. 
                                                                                   As at 31         As at 31 
                                                                                    October          October 
                                                                                   2020 due         2019 due 
                                                                                 within one       within one 
                                                                                       year             year 
                                                                                    GBP'000          GBP'000 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 Exposure to floating interest rates: CFD derivative 
  contract - (absolute exposure)                                                     36,183           42,247 
 Collateral in respect of CFDs                                                           41               16 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 
   (e) Credit risk 
   Credit risk is the possibility of a loss to the Company due to the failure 
   of the counterparty to a transaction discharging its obligations under 
   that transaction. 
 
   Cash and other assets held by the Depositary 
   The cash and other assets held by the Depositary or its sub-custodians 
   are subject to counterparty credit risk as the Company's access to its 
   cash could be delayed should the counterparties become insolvent or 
   bankrupt. 
 
   Derivative instruments 
   The Company's holdings in CFD contracts present counterparty credit 
   risks, with the risk of the counter party (Morgan Stanley & Co International 
   plc) defaulting. 
 
   Management of credit risk 
 Cash and other assets held by 
  the Depositary 
 Cash and other assets that are required to be held in custody will be 
  held by the depositary or its sub-custodians. Cash and other assets 
  may not be treated as segregated assets and will therefore not be segregated 
  from any custodian's own assets in the event of the insolvency of a 
  custodian. Cash held with any custodian will not be treated as client 
  money subject to the rules of the Financial Conduct Authority ('FCA') 
  and may be used by a custodian in the course of its own business. The 
  Company will therefore be subject to the creditworthiness of its custodians. 
  In the event of the insolvency of a custodian, the Company will rank 
  as a general creditor in relation thereto and may not be able to recover 
  such cash in full, or at all. The Company has appointed Northern Trust 
  Global Services SE as its depositary. The credit rating of Northern 
  Trust was reviewed at time of appointment and will be reviewed on a 
  regular basis by the Investment Manager and/or the Board. The Fitch's 
  credit rating of Northern Trust is BBB. 
 Derivative instruments 
 Where the Company utilises CFDs or equity swaps, it is likely to take 
  a credit risk with regard to the parties with whom it trades and may 
  also bear the risk of settlement default. These risks may differ materially 
  from those entailed in exchange-traded transactions that generally are 
  backed by clearing organisation guarantees, daily marking-to-market 
  and settlement, and segregation and minimum capital requirements applicable 
  to intermediaries. Transactions entered into directly between counterparties 
  generally do not benefit from such protections and expose the parties 
  to the risk of counterparty default. CFD contracts generally require 
  variation margins and the counterparty credit risk is monitored by the 
  Investment Manager. 
 
 The Investment Manager monitors the Company's exposure to its counterparties 
  on a regular basis and the position is reviewed by the Directors at 
  Board meetings. Investment transactions are carried out with a number 
  of brokers, whose credit-standing is reviewed periodically by the Investment 
  Manager, and limits are set on the amount that may be due from any one 
  broker. 
 Other risks to the Company are detailed in the Company's prospectus 
  dated 22 January 2021. 
 In summary, the exposure to credit risk as at 31 October 2020 was as 
  follows: 
                                                                                   As at 31         As at 31 
                                                                                    October          October 
                                                                              2020 3 months    2019 3 months 
                                                                                    or less          or less 
                                                                                    GBP'000          GBP'000 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 Cash at bank                                                                         2,463            2,472 
 Amounts due in respect of CFDs                                                       3,014            3,258 
 Collateral paid in respect of 
  CFDs                                                                                   41               16 
 Debtors                                                                              3,100            2,571 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
  Total                                                                               8,618            8,317 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 None of the above assets or liabilities were impaired or past due but 
  not impaired. 
 
 (f) Other Price Risk 
 Other price risk is the risk that the fair value or future cash flows 
  of a financial instrument will fluctuate because of changes in market 
  prices (other than those arising from interest rate risk or currency 
  risk), whether those changes are caused by factors specific to the individual 
  financial instrument or its issuer, or factors affecting similar financial 
  instruments traded in the market. 
 
   The Company is exposed to market price risk arising from its equity 
   investments and its exposure to the positions within the CFD portfolio. 
   The movements in the prices of these investments result in movements 
   in the performance of the Company. 
 The Company's exposure to other changes in market prices at 31 October 
  2020 on its equity investments was GBP180,927,000 (2019: GBP211,240,000). 
 In addition, the Company's gross market exposure to these price changes 
  through its CFD portfolio was GBP36,183,000 through long positions (2019: 
  GBP44,129,000). 
 The Company uses CFDs as part of its investment policy. These instruments 
  can be highly volatile and potentially expose investors to a higher 
  risk of loss. The low initial margin deposits normally required to establish 
  a position in such instruments permit a high degree of leverage. As 
  a result, a relatively small movement in the price of a contract may 
  result in a profit or loss which is high in proportion to the value 
  of the net exposures in the underlying CFD positions. In addition, daily 
  limits on price fluctuations and speculative position limits on exchanges 
  may prevent prompt liquidation of positions resulting in potentially 
  greater losses. 
 The Company limits the gross market exposure, and therefore the leverage, 
  of this strategy to approximately 200% of the Company's net assets. 
  The CFDs utilised have a linear performance to referenced stocks quoted 
  on exchanges and therefore have the same volatility profile to the underlying 
  stocks. 
 Market exposures to derivative contracts are disclosed below. 
 
   The Company's exposure to CFDs is the aggregate of long CFD Positions. 
   The gross and net market exposure is the 
   same as the Company does not hold Short CFD Positions. 
 
   Exposures are monitored daily by the Investment Manager. The Company's 
   Board also reviews exposures regularly. 
 The gross underlying exposures within the CFD portfolio as at 31 October 
  2020 were: 
                                                     As at 31 October 2020             As at 31 October 2019 
                                                                  % of net                          % of net 
                                                     GBP'000        assets          GBP'000           assets 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 CFDs - gross exposure                                36,183        19.63%           42,247           19.73% 
 CFDs - net exposure                                  36,183        19.63%           42,247           19.73% 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 The Board of Directors manages the market price risks inherent in the 
  investment portfolio by ensuring full and timely access to relevant 
  information from the Investment Manager. The Board meets regularly and 
  at each meeting reviews investment performance. The Board monitors the 
  Investment Manager's compliance with the Company's objective. 
 Concentration of exposure to 
  other price risk 
 A sector breakdown of the portfolio is contained in the Portfolio disclosed 
  in the Annual Report. 
 Other price risk sensitivity 
 The following table illustrates the sensitivity of the profit after 
  taxation for the period to an increase or decrease of 10% in the fair 
  values of the Company's equities and CFDs. This level of change is considered 
  to be reasonably possible based on observation of current market conditions. 
  The sensitivity analysis is based on the notional exposure of the Company's 
  equities investments and long CFDs. 
                                                    As at 31 October 2020         As at 31 October 2019 
                                                    Increase      Decrease         Increase         Decrease 
                                                     in Fair       in Fair          in Fair          in Fair 
                                                       Value         Value            Value            Value 
                                                     GBP'000       GBP'000          GBP'000          GBP'000 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 Impact on capital return - increase/(decrease)       21,906      (21,906)           25,537         (25,537) 
 Return after taxation - increase/(decrease)          21,906      (21,906)           25,537         (25,537) 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 
   (g) Liquidity Risk 
 The securities of small-to-medium-sized (by market capitalisation) companies 
  may have a more limited secondary market than the securities of larger 
  companies. Accordingly, it may be more difficult to effect sales of 
  such securities at an advantageous time or without a substantial drop 
  in price than securities of a company with a large market capitalisation 
  and broad trading market. In addition, securities of small-to-medium-sized 
  companies may have greater price volatility as they can be more vulnerable 
  to adverse market factors such as unfavourable economic reports. 
 Management of liquidity risks 
 The Company's Investment Manager monitors the liquidity of the Company's 
  portfolio on a regular basis. 
 Liquidity risk exposure 
 The undiscounted gross cash outflows of the financial liabilities as 
  at 31 October 2020, based on the earliest date on which payment can 
  be required, were as follows: 
                                                                                   As at 31         As at 31 
                                                                                    October          October 
                                                                                       2020             2019 
                                                                                  less than        less than 
                                                                                   3 months         3 months 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 Amounts payable in respect of 
  CFDs                                                                                4,969            5,140 
 Other payables                                                                         216              291 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
  Total                                                                               5,185            5,431 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 
   The Company is exposed to liquidity risks from the leverage employed 
   through exposure to long only CFD positions. However, timely sale of 
   trading positions can be impaired by many factors including decreased 
   trading volume and increased price volatility. As a result, the Company 
   could experience difficulties in disposing of assets to satisfy liquidity 
   demands. Liquidity risk is minimised by holding sufficient liquid investments 
   which can be readily realised to meet liquidity demands. The Company's 
   liquidity risk is managed on a daily basis by the Investment Manager 
   in accordance with established policies and procedures in place. 
 
 (h) Fair Value Measurements of Financial Assets and Financial Liabilities 
 The financial assets and liabilities are either carried in the balance 
  sheet at their Fair Value, or the balance sheet amount is a reasonable 
  approximation of Fair Value (due from brokers, dividends receivable, 
  accrued income, due to brokers, accruals and cash and cash equivalents). 
 The valuation techniques for investments and derivatives used by the 
  Company are explained in the accounting policies notes 2 (b and c). 
 The table below sets out Fair Value measurements using Fair Value Hierarchy. 
                                                     Level 1       Level 2          Level 3            Total 
  As at 31 October 2020                              GBP'000       GBP'000          GBP'000          GBP'000 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 Assets: 
 Equity investments                                  180,927             -                -          180,927 
 CFDs - Fair Value gains                                   -         3,014                -            3,014 
 Liabilities: 
 CFDs - Fair Value losses                                  -       (4,969)                -          (4,969) 
------------------------------------------------  ----------  ------------  --------------- 
 Total                                               180,927       (1,955)                -          178,972 
------------------------------------------------  ----------  ------------  ---------------  --------------- 
 
                                                     Level 1       Level 2          Level 3              Total 
  As at 31 October 2019                              GBP'000       GBP'000          GBP'000            GBP'000 
------------------------------------------------  ----------  ------------  ---------------  ----------------- 
 Assets: 
 Equity investments                                  211,240             -                -            211,240 
 CFDs- Fair Value gains                                    -         3,258                -              3,258 
 Liabilities: 
 CFDs - Fair Value losses                                  -       (5,140)                -            (5,140) 
------------------------------------------------  ----------  ------------  ---------------  ----------------- 
 Total                                               211,240       (1,882)                -            209,358 
------------------------------------------------  ----------  ------------  ---------------  ----------------- 
 There were no transfers between levels during the year (2019: same). 
 
  Categorisation within the hierarchy has been determined on the basis 
  of the lowest level input that is significant to the Fair Value measurement 
  of the relevant asset as follows: 
 Level 1 - valued using quoted prices in active markets for identical 
  assets. 
 Level 2 - valued by reference to valuation techniques using observable 
  inputs including quoted prices. 
 Level 3 - valued by reference to valuation techniques using inputs that 
  are not based on observable market data. (there are no Level 3 investments 
  as at 31 October 2020 (2019: nil). 
 (i) Capital Management Policies and Procedures 
 The Company's capital management objectives are: 
 - to ensure that the Company will be able to continue as a going concern; 
  and 
 - to provide dividend income combined with capital growth, mainly through 
  investment in equities listed or quoted in Japan and by utilising the 
  leverage effect of CFDs. 
 The key performance indicators are contained in the strategic report 
  in the Annual Report . 
 The Company is subject to several externally imposed capital requirements: 
 - As a public company, the Company has to have a minimum share capital 
  of GBP50,000. 
 - In order to be able to pay dividends out of profits available for distribution 
  by way of dividends, the Company has to be able to meet one of the two 
  capital restriction tests imposed on investment companies by company 
  law. 
 The Company's capital at 31 October 2020 comprises called up share capital 
  and reserves totalling GBP184,360,000 (2019: GBP214,126,000). 
 The Board regularly monitors, and has complied with, the externally imposed 
  capital requirements. 
 
 

17. SUBSEQUENT EVENTS

On 22 January 2021, the Company published a prospectus (the "Prospectus") setting out details of the proposed Bonus Issue and convening a general meeting to consider a resolution to allow the Company to implement a Bonus Issue, including the adoption of New Articles. Amendments to the Company's articles of association provide for the rights of the Subscription Shares and obtain authority to allot the Subscription Shares.

The Special Resolution put forward at the General Meeting held on 15 February 2021 to approve the 1 for 5 Bonus Issue of Subscription Shares was passed.

On 16 February 2021, the Board announced a Subscription Price of 161 pence, payable on exercise of each Subscription Share. The Board also announced the allotment of 26,946,122 Subscription Shares pursuant to the terms of the Bonus Issue.

Following admission of the Subscription Shares on 18 February 2021 there were 134,730,610 Ordinary Shares and 26,946,122 Subscription Shares in issue.

ALTERNATIVE PERFORMANCE MEASURES ("APM")

Discount (APM)

The amount, expressed as a percentage, by which the share price is less than the Net Asset Value per share.

 
 As at 31 October 2020 
---------------------------------  -----------  ---------------  ----------  --------- 
 NAV per Ordinary Share (pence)                        a                         136.8 
 Share price (pence)                                   b                         119.5 
 Discount                                         (b÷a)-1                   12.6% 
---------------------------------  -----------  ---------------  ----------  --------- 
 
 
   As at 31 October 2019 
--------------------------------  -----------  ---------------  -----------  --------- 
 NAV per Ordinary Share(pence)                        a                          158.9 
 Share price(pence)                                   b                          150.0 
 Discount                                        (b÷a)-1                     5.6% 
---------------------------------------------  ---------------  -----------  --------- 
 
 
 

Gearing (APM)

A way to magnify income and capital returns, but which can also magnify losses. A bank loan is a common method of gearing.

 
 As at 31 October 2020                                                             GBP'000 
---------------------------------  -----------  ------------------  -----------  --------- 
 CFD notional market value (note 
  16)                                                    a                          36,183 
 Non-base cash borrowings*                               b                           1,893 
 NAV                                                     c                         184,360 
 Gearing (net)                                       ((a+b)/c)                       20.7% 
----------------------------------------------  ------------------  -----------  --------- 
 
 As at 31 October 2019                                                               GBP'000 
----------------------------------  -----------  ------------------  ----------  ----------- 
 CFD notional market value (note 
  16)                                                     a                           42,247 
 Non-base cash borrowings*                                b                            2,864 
 NAV                                                      c                          214,126 
 Gearing (net)                                     ((a+b) ÷c)                     21.1% 
----------------------------------  -----------  ------------------  ----------  ----------- 
 
 
 

*Overdraft cash balance in JPY with Northern Trust.

Leverage (APM) An alternative word for "Gearing".

Under AIFMD, leverage is any method by which the exposure of an AIF is increased through borrowing of cash or securities or leverage embedded in derivative positions.

Under AIFMD, leverage is broadly similar to gearing, but is expressed as a ratio between the assets (excluding borrowings) and the net assets (after taking account of borrowing). Under the gross method, exposure represents the sum of the Company's positions after deduction of cash balances, without taking account of any hedging or netting arrangements. Under the commitment method, exposure is calculated without the deduction of cash balances and after certain hedging and netting positions are offset against each other.

 
                                                Gross   Commitment 
 As at 31 October 2020                        GBP'000      GBP'000 
----------------------------   -----------  ---------  ----------- 
 Security market value               a        180,927      180,927 
 CFD notional market value           b         36,183       36,183 
 Cash and cash equivalents*          c          1,385        2,653 
 NAV                                 d        184,360      184,360 
 Leverage                        (a+b+c)/d       119%         119% 
-----------------------------   ----------  ---------  ----------- 
 
 
                                                        Gross   Commitment 
 As at 31 October 2019                                GBP'000      GBP'000 
------------------------------------   -----------  ---------  ----------- 
 Security market value                       a        211,240      211,240 
 CFD notional market value                   b         42,247       42,247 
 Cash and cash equivalents*                  c          4,554        2,488 
 NAV                                         d        214,126      214,126 
-------------------------------------   ----------  ---------  ----------- 
 Leverage                                (a+b+c)/d       121%         120% 
-------------------------------------   ----------  ---------  ----------- 
 * Calculation under the commitment 
  method. 
--------------------------------------------------  ---------  ----------- 
 
 

Ongoing charges (APM)

A measure, expressed as a percentage of average net assets, of the regular, recurring annual costs of running an investment company.

 
 Year end 31 October 2020 
-------------------------------------  -----------  -------------  ----------  ------------ 
 Average NAV                                              a                     190,442,282 
 Annualised expenses                                      b                       1,981,000 
 Ongoing charges                                      (b÷a)                      1.04% 
-------------------------------------  -----------  -------------  ----------  ------------ 
 
 Year end 31 October 2019 
------------------------------------  -----------  -------------  -----------  ------------ 
 Average NAV                                             a                      195,678,342 
 Annualised expenses*                                    b                        2,083,000 
 Ongoing charges                                     (b÷a)                       1.06% 
------------------------------------  -----------  -------------  -----------  ------------ 
 
 
 

Total return (APM)

A measure of performance that takes into account both income and capital returns.

 
 Year end 31 October 2020                                    Share price        NAV 
--------------------------------  -----------  -----------  ------------  --------- 
 Opening at 1 November 2019 (in 
  pence)                               a                           150.0      158.9 
 Closing at 31 October 2020 (in 
  pence)                               b                           119.5      136.8 
 Price movement (b÷a)-1           c                          -20.3%     -13.9% 
 Dividend reinvestment                 d                            3.0%       2.7% 
 Total return                        (c+d)                        -17.3%     -11.2% 
--------------------------------  -----------  -----------  ------------  --------- 
 
 Year end 31 October 2019                                    Share price          NAV 
---------------------------------  -----------  ----------  ------------  ----------- 
 Opening at 1 November 2018 (in 
  pence)                                a                          153.0        148.6 
 Closing at 31 October 2019 (in 
  pence)                                b                          150.0        158.9 
 Price movement (b÷a)-1            c                          -2.0%         6.9% 
 Dividend reinvestment                  d                           2.7%         3.0% 
 Total return                         (c+d)                         0.7%         9.9% 
---------------------------------  -----------  ----------  ------------  ----------- 
 
 
 

ANNUAL GENERAL MEETING

The Annual General Meeting will be held at 12 noon on 26 March 2021. As a result of the COVID-19 pandemic and associated UK Government guidance, physical attendance at the AGM will not be possible. The AGM will be held virtually via video conference as the safety of Shareholders and of the Company's service providers is the Board's primary concern.

26 February 2021

Secretary and registered office:

PraxisIFM Fund Services (UK) Limited

1st Floor, Senator House

85 Queen Victoria Street

London

EC4V 4AB

For further information contact:

PraxisIFM Fund Services (UK) Limited

Tel: 020 4513 9260

END

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

FR DKPBDDBKBKBB

(END) Dow Jones Newswires

February 26, 2021 02:00 ET (07:00 GMT)

1 Year Cc Japan Income & Growth Chart

1 Year Cc Japan Income & Growth Chart

1 Month Cc Japan Income & Growth Chart

1 Month Cc Japan Income & Growth Chart
ADVFN Advertorial
Your Recent History
LSE
CCJI
Cc Japan I..
Register now to watch these stocks streaming on the ADVFN Monitor.

Monitor lets you view up to 110 of your favourite stocks at once and is completely free to use.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:gb D:20210419 19:44:14