MATE.L Regulatory News (MATE)

LONDON STOCK EXCHANGE ANNOUNCEMENT

JPMORGAN MULTI-ASSET GROWTH & INCOME PLC

UNAUDITED HALF YEAR RESULTS FOR THE SIX MONTHS ENDED31ST AUGUST 2023

CHAIRMAN'S STATEMENT

Introduction

The objective of the Company is to generate income and capital growth through a multi-asset strategy, while seeking to maintain lower levels of volatility than an equity portfolio. Our commitment to this objective is underpinned by the Company's progressive distribution policy (adopted on 1st March 2021) which aims to increase the dividend in line with the UK's annual Consumer Price Index from the initial distribution level of 4p per share per annum set at launch in 2018.

Portfolio Performance

During the half year to 31st August 2023, the Company recorded a positive total return of 1.6% on its opening net asset value, an underperformance of 1.4% compared to the Company's Reference Index. The Company recorded a negative share price total return to shareholders of 2.6% as the discount to net asset value widened over the period. Although the underperformance is disappointing it should be noted that the Company's Reference Index is a total return of 6.0% per annum measured over a rolling five year period. Therefore, unlike a typical benchmark, it is not a relative index and is unaffected by the market movements experienced during this reporting period.

Despite numerous interest rate rises in the first half of 2023 a significant slowdown in the global economy has yet to emerge. Equity markets, particularly in the US, have responded positively to the declines in inflation that have emerged in most leading global economies.

For further details regarding the management of the Company's portfolio please see the Investment Managers' Report.

Discount Management

The Board recognises that it is in the interests of shareholders to maintain a share price as close as possible to the net asset value per share. The Board utilises share buybacks to address imbalances in supply of and demand for the Company's shares in the market, when it believes it is in the interests of all shareholders and subject to normal market conditions. During this six month reporting period, the Board utilised their authority to buyback shares in the Company to manage the discount and bought back 3,250,000 shares at an average discount of 5.5%. The discount commenced the period under review at -0.4% but moved wider to close on 31st August 2023 at -4.6%. The widening of the Company's discount reflects the increasing discounts currently experienced across the wider investment trust industry. The Company's share price on 10th October 2023 (the last practical date before printing this document), was 89.0p per share, with a discount to net asset value of -3.9%

Revenue and Distributions

During the half year to 31st August 2023, the Company's net return of revenue and capital after taxation was £946,000 (2022: net loss after taxation: £5,442,000). In the period up to the filing of this half year report, the Board has declared two interim distributions of 1.2p per share in respect of the Company's year ending 29th February 2024. As detailed in my previous Chairman's Statement included in the Company's annual report and financial statements, the Board's expectation is to pay a total distribution of 4.8p per share for the year ending 29th February 2024. This represents an increase of 9.1% on the 2023 distribution and an increase of 20.0% since the distribution policy was adopted on 1st March 2021. This fulfils the Board's aim to help protect shareholders' distribution income from inflation. A further two distributions are expected to be paid to shareholders in February and May 2024 in respect of the year ending 29th February 2024.

Gearing

The Company may use gearing, in the form of borrowings and derivatives, to seek to enhance returns over the long term. During the period the Company had no bank loans/facilities or structured debt, but did use derivatives to enhance portfolio returns and for efficient portfolio management. The level of the Company's cash position at 31st August 2023 was 7.3%, (28th February 2023: 4.8%), reflecting an increase in the net cash position of the Company during this reporting period. See page 29 of the Company's half year report and financial statements for further details and definition of Gearing.

Outlook

Central Banks in the world's leading economies have so far managed to successfully increase interest rates without provoking a widescale global recession. How long this balancing act can be maintained is uncertain and there remain significant concerns about the outlook for the global economy. These include the continuing conflict in Ukraine which compounds the inflationary pressure on global commodities, increasing US/China tensions and the challenges of successful adoption of artificial intelligence.

The Board has confidence in the Investment Managers' ability to navigate these difficult markets. The JPMorgan Multi-Asset Team have substantial resources and experience to draw upon and the Investment Managers have the freedom and expertise to allocate across a wide range of asset classes. The investment trust structure is conducive to a long-term investment outlook and the Company's progressive dividend policy, which aims to match the long term trajectory of CPI, should provide some reassurance to shareholders in the current environment of high levels of inflation.

Sarah MacAulay

Chairman 12th October 2023

INVESTMENT MANAGER'S REPORT

Introduction

In this report, we review the Company's investment performance for the six-month period to 31st August 2023. This was a period when markets became increasingly hopeful that visible signs of moderating inflation could give central banks room to pause, or even lower policy rates, while deferring the onset of recession as labour markets still stood strong. We examine how the Company's diversified portfolio has performed against this market backdrop, how positioning has evolved through the period and our views looking forward.

Setting the scene - our investment approach

We seek to achieve the best risk-adjusted returns by investing in a globally diversified portfolio that includes company shares, bonds and other assets. Our aim is to construct an actively managed, balanced portfolio which is flexible with respect to asset class and geography. This flexibility allows us to take advantage of the best opportunities to deliver an attractive total return to our shareholders. We look to generate this through a research-based approach, positioning assets in line with our medium to long-term view of markets and leveraging the expertise of active managers in portfolio construction.

Market review: Increasing confidence in a soft landing supported a broad rally in global equities driven by slowing inflation and resilient economic data in the U.S.

2023 started on an optimistic note as markets rallied against a backdrop of recession risk fading in Europe, the re-opening of China's economy and market hopes of an imminent end to major central bank's tightening cycle. However, banking turmoil in the U.S. and Europe dominated headlines in March and unsettled markets, triggered by the failure of Silicon Valley Bank (SVB); the second largest bank failure in U.S. history reflecting inadequate liquidity and insolvency issues. The first quarter of the year finished somewhat calmer following several packages from the Treasury, Federal Reserve (Fed) and Federal Deposit Insurance Corporation (FDIC) and buyouts of banks such as SVB and Credit Suisse. Global equity markets posted positive returns in March as fears of a broader contagion ultimately lessened and the market instead focused on the potential for a more dovish shift by the Federal Reserve.

Global equity markets continued to advance in April as economic data releases indicated that the financial sector stress appeared relatively contained. However, risk assets lost momentum in May as the U.S. debt ceiling negotiations caused concern, China's economic recovery faltered, and Germany slipped into technical recession. Global fixed income returns were negative in May as the market's shift to a less dovish outlook for the fed funds rate weighed on both credit and government bonds. Resilient economic data in the U.S. in June pushed back the timeline for an anticipated downturn while corporate governance reforms in Japan rekindled investors' interest in its equities. Both the U.S. and Eurozone CPI eased, leading markets to price in the higher probability of a soft landing. In contrast, UK core inflation rose to the highest level since March 1992 which prompted the Bank of England to further raise its policy rate. The equity rally broadened in July on the back of resilient U.S. GDP data and corporate profits, moderating inflation in the U.S. and Europe, and emerging policy support in China. However, volatility again returned to the markets in August, as overall, an increase in long-term rates in the U.S., weak macroeconomic data in China and deteriorating activity levels in Europe weighed on global stock markets. In bond markets, the increase in U.S. treasuries issuance along with Fitch's downgrade of U.S. debt pushed the long-term yields higher and weighed on the bond market returns.

How has the Company performed over the six-month period under review?

The Company delivered a positive return on net assets of 1.6% but lagged the company's Reference Index which returned 3.0% over the period. The portfolio's developed equity exposure provided the largest positive contribution to return. Our position in China A Shares disappointed against a backdrop of weaker than anticipated post-Covid recovery. We significantly increased the Company's duration profile through 2023, which has proved a challenge in a volatile environment for bond yields but should benefit the portfolio in the environment of declining inflation that we see ahead and when traditional correlations reassert themselves.

Portfolio review

In terms of positioning over the period, while equity levels increased, they remained at levels below the long-term average, reflecting a degree of caution given potential risks. For equities, stock selection is undertaken by our in-house International Equity Group and we tilt regional positioning to reflect our latest views. We implement this via the use of index futures. This approach enables us to maintain positions in high conviction stocks whilst adjusting regional exposure to reflect our favoured markets. Over the period, we added to the US, Europe and Japan and scaled back exposure to the UK and emerging markets. The U.S. market has displayed remarkable resilience this year powered by robust consumer spending and a strong labour market. We added to Japanese equities in June given improved prospects for corporate profits and valuation expansion. We scaled back our exposure to emerging market equities through the period, driven by our fading conviction in the China re-opening theme, and fully redeemed our position in China A Shares in August. We also remain underweight U.S. small caps as we think those companies are likely to come under pressure in a higher rate environment.

Within fixed income, we increased the duration of the portfolio, selectively adding exposure at attractive levels though the period, primarily in the US treasury market and more recently via German government bonds. We increased our allocation to both corporate credit and emerging market local currency debt in the summer. As the probability of a deep recession started to recede in July, we added to our high yield exposure and reduced our Japanese government bond short position by half as pressure on the Bank of Japan to adjust yield curve control measures lessened.

In our bespoke equity portfolio, performance was positive, albeit it lagged broad equity markets as measured by the MSCI World hedging to GBP index. At a sector level, the largest contributors to performance were stock selection in media and an underweight position in insurance. Detractors included stock selection in technology - semi & hardware and banks. The largest sector changes over the period were an increase in exposure to insurance and utilities and a reduction in automobiles & auto part and transportation. At the end of August, the portfolio was most overweight the financial services, technology - semi & hardware and media sectors, while it was most underweight the consumer staples, industrial cyclical and automobiles & auto part sectors. At-a regional level, the portfolio was overweight emerging markets and underweight Japan and the United States.

We placed a redemption order for our Infrastructure Investment Fund holding given the lower conviction levels in the strategy in the current market environment.

Outlook

Market sentiment remains cautious as recession risks continue to be modestly elevated. Our base case sees further moderation of inflation and economic growth, but also acknowledges the underlying resilience of the U.S. economy. This leads us to favour investments in bond markets with an attractive yield and relative value trades within markets rather than bold directional calls, although we believe that rates will move lower once it becomes clear that central banks will no longer need to continue increasing interest rates. Therefore, current yields support holding moderate levels of interest sensitivity in our fixed income allocation and we see diversification potential in the UK and Europe, where growth is slower, and in Australia where interest rates are lower. In equity markets, we have a bias towards the better earnings and cash flow outlook in the U.S. and Japan compared with Europe and the emerging markets.

Katy Thorneycroft

Gareth Witcomb

Investment Managers 12th October 2023

INTERIM MANAGEMENT REPORT

The Company is required to make the following disclosures in its Half Year Report:

Principal Risks and Uncertainties

The principal risks and uncertainties faced by the Company fall into five broad categories: investment and strategy; accounting, legal and regulatory; corporate governance and shareholder relations; operational; and financial, including the risk of geopolitical events, climate change, global pandemics and artificial intelligence (AI). Information on each of these areas is given in the Company's Strategic Report within the Annual Report and Financial Statements for the period ended 28th February 2023.

Related Parties Transactions

During the first six months of the current financial year, no transactions with related parties have taken place which have materially affected the financial position or the performance of the Company during the period.

Going Concern

The Directors believe, having considered the Company's investment objectives, risk management policies, capital management policies and procedures, nature of the portfolio and expenditure projections, and the economic and operational impact of Russia's invasion of Ukraine and Covid-19 that the Company has adequate resources, an appropriate financial structure and suitable management arrangements in place to continue in operational existence for the foreseeable future and, more specifically, that there are no material uncertainties relating to the Company that would prevent its ability to continue in operational existence for at least 12 months from the date of the approval of this interim financial report. For these reasons, they consider there is reasonable evidence to continue to adopt the going concern basis in preparing the accounts.

Directors' Responsibilities

The Board of Directors confirms that, to the best of its knowledge:

(i) the condensed set of financial statements contained within the half yearly financial report has been prepared in accordance with FRS104 'Interim Financial Reporting' and gives a true and fair view of the assets, liabilities, financial position and net return of the Company as required by the UK Listing Authority Disclosure and Transparency Rules ('DTR') 4.2.4R; and

(ii) the interim management report includes a fair review of the information required by DTR 4.2.7R and 4.2.8R.

In order to provide these confirmations, and in preparing these financial statements, the Directors are required to:

? select suitable accounting policies and then apply them consistently;

? make judgements and accounting estimates that are reasonable and prudent;

? state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

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

and the Directors confirm that they have done so.

For and on behalf of the Board

Sarah MacAulay

Chairman 12th October 2023

CONDENSED STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 31st August 2023

All revenue and capital items in the above statement derive from continuing operations.

The 'Total' column of this statement is the profit and loss account of the Company and the 'Revenue' and 'Capital' columns represent supplementary information prepared under guidance issued by the Association of Investment Companies.

The net return/(loss) after taxation represents the profit/(loss) for the period and also the total comprehensive income.

CONDENSED STATEMENT OF CHANGES IN EQUITY

1 These reserves form the distributable reserve of the Company and may be used to fund distributions to investors.

CONDENSED STATEMENT OF FINANCIAL POSITION

At 31st August 2023

CONDENSED STATEMENT OF CASH FLOWS

For the six months ended 31st August 2023

1 The presentation of the Cash Flow Statement, as permitted under FRS 102, has been changed so as to present the reconciliation of 'net return/(loss) before finance costs and taxation' to 'net cash inflow from operating activities' on the face of the Cash Flow Statement. Previously, this was shown by way of note. Other than consequential changes in presentation of the certain cash flow items, there is no change to the cash flows as presented in previous periods.

Analysis of change in net debt

CONDENSED NOTES TO THE FINANCIAL STATEMENTS

For the six months ended 31st August 2023

1. Financial statements

The information contained within the Condensed financial statements for this half year report has not been audited or reviewed by the Company's auditors.

The figures and financial information for the year ended 28th February 2023 are extracted from the latest published financial statements of the Company and do not constitute statutory accounts for that year. Those financial statements have been delivered to the Registrar of Companies and including the report of the auditors which was unqualified and did not contain a statement under either section 498(2) or 498(3) of the Companies Act 2006.

2. Accounting policies

The financial statements have been prepared in accordance with the Companies Act 2006, FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' of the United Kingdom Generally Accepted Accounting Practice ('UK GAAP') and with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' (the 'SORP') issued by the Association of Investment Companies in July 2022.

FRS 104, 'Interim Financial Reporting', issued by the Financial Reporting Council ('FRC') in March 2015 has been applied in preparing this condensed set of financial statements for the six months ended 31st August 2023.

All of the Company's operations are of a continuing nature.

The accounting policies applied to this condensed set of financial statements are consistent with those applied in the financial statements for the year ended 28th February 2023.

3. Management fee

Due to an administrative error in the calculation of the management fees, the Company over paid the management fee to the Manager for the period 2nd July 2018 to 30th June 2023 by £97,000. This amount has been adjusted against the management fee of £114,000 shown in the Condensed Statement of Comprehensive Income for the period ended 31st August 2023, and no restatement has been made to prior periods in this respect. The overpayment was in respect of the excess management fee paid to the Manager for the investment in the IIF UK LP 1 fund, which should have been deducted from the management fee payable by the Company during that period.

4. Return/(loss) per share

5. Distributions paid

All distributions paid and declared in the period/year are and will be funded from the revenue, capital and special reserves.

A second interim dividend of 1.20p per share, amounting to £904,000 has been declared payable on 3rd November 2023 in respect of the year ending 29th February 2024.

JPMORGAN FUNDS LIMITED

12th October 2023

For further information, please contact:

Paul Winship

For and on behalf of

JPMorgan Funds Limited

0800 20 40 20

END

A copy of the half year report will shortly be submitted to the FCA's National Storage Mechanism and will be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism 

The half year report will also shortly be available on the Company's website at www. www.jpmmultiassetgrowthandincome.co.uk where up to date information on the Company, including daily NAV and share prices, factsheets and portfolio information can also be found.

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