The Monks Investment Trust PLC (MNKS)
Legal Entity Identifier: 213800MRI1JTUKG5AF64
Results for the year to 30 April 2026
| NAV (borrowings at fair value)* | 29.3% |
| NAV (borrowings at par)* | 29.4% |
| Share Price* | 35.6% |
| Index† | 31.0% |
* Alternative Performance Measure – see Glossary of terms and Alternative Performance Measures at the end of this announcement.
† Comparative index: FTSE World Index (in sterling terms).
The following is extracted from the Annual Report and Financial Statements of the Company for the year ended 30 April 2026 which was approved by the Board on 30 June 2026. All page references below refer to the Annual Report and Financial Statements which will be made available on the Company’s website.
Chairman’s Statement
Performance
Global equity markets delivered strong returns over the year to 30 April 2026, despite ongoing macroeconomic and geopolitical uncertainty. Market leadership broadened beyond the narrow group of mega-cap technology companies that had dominated returns in prior years, while continued investment in artificial intelligence infrastructure and applications remained an important driver of corporate earnings and investor sentiment.
Against this backdrop, Monks delivered a strong absolute return. During the year to 30 April 2026, the net asset value (‘NAV’) total return, with borrowings calculated at fair value, was 29.3% and the share price total return was 35.6%. Over the same period, the FTSE World Index return was 31.0%. The share price discount to NAV narrowed materially during the period, ending the year at 5.7% on a fair value basis compared to 10.1% at the prior year end.
The Board recognises that performance over shorter periods can vary significantly given the Company’s long-term growth approach. However, we are encouraged by the portfolio’s recovery and by the operational and strategic progress made by many of the underlying holdings during the year.
Capital allocation and discount
The Board continued to prioritise active discount management during the year. The Company’s shares traded at a discount to net asset value throughout the period, although the discount narrowed significantly as market sentiment improved and the Board maintained an active buyback programme.
During the financial year, the Company repurchased 30.2 million shares at a total cost of £432.6 million (26.5 million shares at a cost of £321.1 million in 2025). These repurchases represented 16.1% of the issued share capital at the start of the period. This reflects the Board’s commitment to the discount objective. At the year end, shares in issue totalled 157.5 million, with 95.7 million shares held in treasury.
The Board continues to believe that share buybacks are an effective capital allocation tool when the shares trade at a meaningful discount to NAV. Buybacks enhance NAV per share for ongoing shareholders while also supporting liquidity in the Company’s shares.
The Board aims to maintain the discount in mid-single digits, in normal market conditions.
Borrowings and gearing
The Company’s investment trust structure allows the use of gearing in pursuit of enhanced long-term returns. The Board’s strategic borrowing target remains 10%, with effective gearing expected to be maintained within a range of minus 15% to plus 15%.
At the year end, net gearing stood at 8.5% and gross gearing at 8.9%. The Company had £50 million drawn under its £100 million revolving credit facility with The Royal Bank of Scotland International. In addition, the Company continues to benefit from long-term structural borrowings in sterling, euro and yen, secured at attractive rates in prior years.
The Board and Managers continue to believe that a diversified borrowing structure provides both flexibility and resilience over the long term.
Management expenses
Monks remains highly competitive on costs, and the Board continues to believe that maintaining a low ongoing charges ratio is an important contributor to long-term shareholder returns. The total ongoing charges ratio for the year to 30 April 2026 was 0.44% (0.43% to 30 April 2025).
Earnings and dividend
Monks invests with the aim of maximising capital growth rather than income. The Board’s policy remains to pay the minimum dividend necessary to maintain the Company’s investment trust status. All costs are charged to the Revenue Account and retained earnings are reinvested into the portfolio.
The Board is recommending that a single final dividend of 0.9p be paid, compared to 0.5p last year, to ensure that the amount retained for the year does not exceed that permissible.
Subject to shareholder approval at the Annual General Meeting, the dividend will be paid on 15 September 2026 to shareholders on the register at the close of business on 7 August 2026. The ex-dividend date will be 6 August 2026.
The Board
As they reach the end of their tenures, Professor Sir Nigel Shadbolt and Belinda Richards will be retiring from the Board at the conclusion of the forthcoming Annual General Meeting. Given the rise in the importance of AI and of world trade tensions, it is hard to imagine two better-qualified directors to have helped steer the Company over the last few years. Nigel’s deep expertise in AI has informed both our engagement with the Managers and, through his presentations at Board meetings, the Board’s collective understanding of where the technology is heading. Belinda’s experience across financial services and businesses engaged in global trade has been similarly valuable, particularly as tariffs and the terms-of-trade environment have moved to the centre of investor concerns. The Board thanks them both for their contribution.
It is a tribute to Karl Sternberg, my predecessor as Chair, that the succession process has been smooth, with David Ballance and Richard Curling joining last year, allowing an overlap with Nigel and Belinda. This is the first annual report under my chairmanship, and I would like to take the opportunity to record the Board’s thanks to Karl for his leadership of the Company during his time as Chair, for the rigour he brought to Board oversight and for setting in motion the deeper manager review whose conclusions are reflected in this report.
Stacey Parrinder-Johnson has taken over my responsibilities as chair of the Nomination Committee, which allows me to focus on other aspects of your Company’s activities. The Board remains focused on maintaining an appropriate balance of continuity, diversity of thought and relevant investment trust experience.
Manager Review
Spencer Adair, as previously announced, retired at the end of March this year. The Board would like to thank Spencer for his contribution to the Company over many years and wish him well for what comes next. Michael Taylor became co-manager on 1 April 2026, joining Helen Xiong and Malcolm MacColl.
As per my predecessor’s comments in the Annual Report of last year, and my comments in the Interim Report, your Board engaged with the Managers over a number of sessions for a deeper dive than the usual manager review.
Firstly, and perhaps most importantly, the manager transition was smooth, with the team having all worked together over a number of years in Baillie Gifford’s wider Global Alpha strategy.
Secondly, there is no fundamental change to our underlying strategy. Monks offers investors exposure to global growth, with a balance between different styles of growth – stalwarts, rapid and cyclical growth. And as importantly, culture and process, investment approach and philosophy remain unchanged.
Thirdly there is a balance between patient investing and responding to markets or news headlines. The seeds for some of the investments the Company is now harvesting were planted years ago. It is often easy from the outside to suggest that a fund manager responds to the ‘hot idea’ of the season, month, week or day. Having sat in fund manager seats, I know what the pressure is like.
At the risk of dragging in my more trading orientated background, please indulge me in quoting Jesse Livermore, perhaps one of the greatest traders who ever lived:
‘Money is made by sitting, not trading’
And
‘Just remember, without discipline, a clear strategy, and a concise plan, the speculator will fall into all the emotional pitfalls of the market – jump from one stock to another, hold a losing position too long, and cut out of a winner too soon, for no reason other than fear of losing profit.’
In many ways, the above two quotes summarise the conclusions of our deep dive and the ambition of both the Board and the Managers for the investment process – we must combine patient long-term investing with the discipline to exit when the time comes.
Two examples illustrate this patient, disciplined approach, anchored in a clear strategy and a concise plan. As mentioned earlier, Nigel has been researching AI since the 1970s. He has presented or discussed AI on a number of occasions at Board meetings, with the Managers also present. In parallel, the Managers have been undertaking considerable work of their own in the area. Thus our current exposure to the AI segment of the market is not a flash in the pan driven by current news headlines, but built over a few years by a disciplined investment process and a long-term view on what AI might deliver.
A similar pattern has been followed by our exposure to another company which is now a name in the news: Space Exploration Technologies, or SpaceX as it is commonly known. This is also an interesting case study because we have both direct exposure and indirect. This indirect exposure to private companies, via Schiehallion, provides us with access and understanding to the unlisted sector that we might otherwise not have. As high growth companies stay private for longer, this is an important consideration.
In both cases, the investment process builds confidence in the longer term outcome and enables the Company to ‘sit’ with positions.
Discipline cuts two ways: ‘the long term’ is never an excuse; if the Managers lose confidence in an investee company or feel the original hypothesis has weakened, or there are better prospects for our capital elsewhere, then their discipline requires the position is exited.
There are elements in the above that we have all been keen to tighten up – ‘clear strategy’, ‘concise plan’, ‘discipline’ – but the Board was pleased at the willingness of the Managers to engage on all these points; the underlying building blocks are, and have been, in place.
One example of this in practice has been the increased focus on valuation discipline, with the Managers now reporting regularly to the Board on positions they have trimmed or exited due to valuation overstretch.
An important element that Karl referred to previously is market dynamics. One aspect of this is that constant news coverage and, as has been illustrated during the recent conflict between the US and Iran, market sentiment, can swing tremendously in minutes, let alone days or weeks. The wisdom of Jesse Livermore’s words (written about a century ago) on having a clear plan for every position are perhaps more relevant today than ever, else, every investor risks being shaken out of positions by emotions. However, this does not mean one sits immovably if there is (what is known in macro and quantitative investing circles as) a regime change – the difficulty, perhaps more than ever, is distinguishing between short term sentiment swings and more fundamental issues. Valuation discipline is one of a number of means by which we protect our downside.
We hope investors will share our ambition – we aim to deliver you exposure to diversified forms of global growth.
Outlook
In the last year, global equity returns have not been as concentrated in the Mag-7 stocks as they were in recent years. We hope this broader dispersion in returns will play to our strategy’s strengths.
I would be remiss not to mention the clouds on the horizon. The world has contained the impact of the change in tariffs and the terms-of-trade shock with relatively little immediate disruption, and the sudden rise in the oil price has been absorbed remarkably well so far. But the consequences of all of this will take months, or indeed years, to play out. To give but one example, disruption of fertiliser supply from the Arabian Gulf will affect crop yields, farmers and ultimately consumers globally into 2027. Repairs to the liquefied natural gas trains damaged in the recent conflict could, on some estimates, take five years.
Indeed, this macro backdrop reinforces the case for active stock selection over passive exposure to mega-cap concentration and, equally, the case for global diversification over a single sector or region.
Annual General Meeting
The Annual General Meeting will be held on Friday, 4 September 2026 at One Moorgate Place, City of London, EC2R 6EA at 11.30am. We look forward to welcoming our shareholders there.
The Board intends to hold the AGM voting on a poll, so encourages all shareholders to exercise their votes at the AGM by completing and submitting a form of proxy. We recommend that shareholders monitor the Company’s website at monksinvestmenttrust.co.uk where any updates regarding the meeting will be posted. Market announcements will also be made in the event of any change to the scheduled arrangements.
Should shareholders have questions for the Board or the Managers, or any queries as to how to vote, they are welcome as always to submit them by email to enquiries@bailliegifford.com or call 0800 917 2113. For shareholders investing through a platform, the AIC guidance on how to vote shares in advance or obtain the documentation necessary to vote in person at the AGM, may be of assistance: theaic.co.uk/how-to-vote-your-shares.
Randeep Grewal
Chairman
30 June 2026