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Baillie Gifford US Growth Trust - Final Results

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Baillie Gifford US Growth Trust plc

Results for the year ended 31 May 2020

During the financial year to 31 May 2020, the Company's share price and net asset value returned 46.5% and 44.2% respectively. This compares with a total return of 15.0% for the S&P 500 Index total return* (in sterling terms).

  • Lockdowns introduced to slow the spread of the virus have disrupted regular patterns of demand.
  • Most of the Company's holdings have been beneficiaries of these shifts, although some have been on the wrong side of them.
  • New listed holdings include video-conferencing company Zoom, telemedicine company Teladoc, and three enterprise software companies, Workday, Twilio and Cloudflare
  • Eight additional unlisted investments were made, and two existing unlisted holdings went public.
  • At 31 May 2020, the Company held 17 unlisted investments, comprising approximately 12% of total assets.

Baillie Gifford US Growth Trust plc seeks to invest predominantly in listed and unlisted US companies which the Company believes have the potential to grow substantially faster than the average company, and to hold onto them for long periods of time, in order to produce long term capital growth.

You can find up to date performance information about Baillie Gifford US Growth on the US Growth Trust page of the Managers' website at 

Baillie Gifford US Growth Trust is managed by Baillie Gifford, the Edinburgh based fund management group with around £280 billion under management and advice in active equity and bond portfolios for clients in the UK and throughout the world (as at 1 September 2020).

Investment Trusts are UK public limited companies and are not authorised or regulated by the Financial Conduct Authority.

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

Past performance is not a guide to future performance.  The value of an investment and any income from it is not guaranteed and may go down as well as up and investors may not get back the amount invested.  This is because the share price is determined by the changing conditions in the relevant stock markets in which the Company invests and by the supply and demand for the Company's shares.

3 September 2020

The following is the Preliminary Results Announcement for the year to 31 May 2020 which was approved by the Board on 2 September 2020.

Chairman's Statement

It is with pleasure that I present the Annual Report for Baillie Gifford US Growth Trust plc ('the Company') for the year to 31 May 2020. During the period, we witnessed the spread of the Covid-19 pandemic, with equity markets experiencing their most significant falls for a decade in March 2020, before recovering in the following


The Board is pleased to be able to report that our Managers have moved seamlessly to working remotely and that both portfolio management and all regulatory and administrative tasks have continued uninterrupted. The Managers continue to stick to their long-term investment approach and are focused on identifying the exceptional growth companies in America.

During the financial year to 31 May 2020, the Company's share price and net asset value returned 46.5% and 44.2% respectively. This compares with a total return of 15.0% for the S&P 500 Index * (in sterling terms). Over the period from 23 March 2018 (launch date and first trade date), the Company's share price and net asset value returned 88.1% and 85.7% respectively compared to a total return of 40.6% for the S&P 500 Index (in sterling terms).

The Board is encouraged by the net asset value total return that the Managers have been able to deliver over the period since launch. However, we would ask shareholders to judge performance over periods of five years or more. Further information about the Company's portfolio performance is covered by our portfolio managers, Gary Robinson and Helen Xiong, in their Managers' Review.

Share Issuance and Buy-backs

The Company's shares have continued to consistently trade at a premium to their net asset value and the Company has issued a further 31,965,000 shares in the year to 31 May 2020 at an average premium to net asset value of approximately 3%, raising further proceeds of £48.1 million.

At 31 May 2020 we had authority, which was granted at the initial launch, to issue a further 738.2 million shares. This authority expires in March 2023.

The Company also has authority to buy-back shares. The buy-back facility was sought to allow the Company to buy-back its own shares when the discount is substantial in absolute terms and relative to its peers. The Company will be seeking to renew the buy-back authority at the forthcoming Annual General Meeting.


On 1 August 2018, the Company entered into a five year US$25 million revolving credit facility with ING Bank N.V., London Branch. The facility is available to be used to fund purchases of securities as and when suitable opportunities arise. As at 31 May 2020 US$18 million (31 May 2019 - US$15 million) had been drawn down under the facility.

Earnings and Dividend

The Company's priority is to generate capital growth over the long term. The Company therefore has no dividend target and will not seek to provide shareholders with a level of dividend. The net revenue return per share for the year to 31 May 2020 was a negative 1.05p (period to 31 May 2019, a negative 1.09p). As the revenue account is again running at a deficit, the Board is recommending that no final dividend be paid. Should the level of underlying income increase in future years, the Board will seek to distribute the minimum permissible to maintain investment trust status by way of a final dividend.

Unlisted Investments

As at the Company's year end, the portfolio weighting in unlisted investments stood at 12.2% of total assets, invested in seventeen holdings (2019 - 10.8% invested in eleven holdings). There were eight new purchases in the year and two stocks, Peloton Interactive and Slack Technologies, listed. There is commentary on the new holdings in the Managers' Review and Review of Investments below.

Since the year end further investment has been made in Away (JRSK), Ginkgo Bioworks, Indigo Agriculture, Space Exploration Technologies and Tanium, and a new holding acquired, Epic Games.

Your portfolio managers remain alert to further special and high potential opportunities not widely accessible through public markets.

Annual General Meeting

The Annual General Meeting of the Company has been scheduled to be held at Baillie Gifford's offices in Edinburgh at 9.30am on Friday, 9 October 2020 but, given the ongoing uncertainty around when public health concerns will abate, the Board will continue to monitor developments and may decide to prohibit shareholders

from attending in person. Accordingly, the Board encourages all shareholders to exercise their votes at the AGM by completing and submitting a form of proxy. We would encourage shareholders to monitor the Company's website at where any updates will be posted and market announcements will also be made, as appropriate. 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 or call 0800 917 2112.

Information on the resolutions can be found on page 58 of the Annual Report and Financial Statements. The Directors consider that all resolutions to be put to shareholders are in their and the Company's best interests as a whole and recommend that shareholders vote in their favour.


This year the Company is once again required to comment on the potential material impact of Brexit on its future prospects. Notwithstanding the UK's departure from the European Union on 31 January 2020, little has changed over the year. The Board has reconsidered the uncertainties surrounding Brexit and can see no scenario that it believes would affect the going concern status or viability of the Company. As the vast majority of the Company's

assets are denominated in US dollars, the Company's greatest exposure to any potential impact from Brexit is through fluctuations in the exchange rate at which the value of its assets are converted into sterling (the Company's functional currency and that in which it reports its results).


The last 12 months have been extraordinary ones for investors in the US stock market and it seems probable that the next 12 could be equally turbulent. At the time of writing, it seems probable that we are at the dawn of a significant global recession and ongoing market volatility is to be expected. In that context, it is comforting to note that as long-term investors in exceptional growth companies, many of the organisations in which we are invested have thrived during the period. As the digital transformation that has been accelerated by the Covid-19 pandemic continues, the portfolio should be well positioned to benefit in the long term. All that being the case, the Board and the Managers remain confident in our outlook.