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Schroder UK Public Private Trust plc

Announcement of Net Asset Value as of 31 March 2022

Schroder UK Public Private Trust plc (the "Company") today announces its net asset value ("NAV") as of 31 March 2022.

Summary

· NAV of 39.57p per share as of 31 March 2022, a decrease of 17.7% relative to the NAV as of 31 December 2021 (48.08p per share).

· The largest detractor from performance was Oxford Nanopore which declined 43% in line with its broader market comparables, despite good underlying progress and material upgrades to its forward revenue guidance.

· During the quarter, the Company completed the sale of Seedrs receiving cash proceeds of £12.0 million.

· Further progress was achieved in repositioning the portfolio with the eighth and ninth new investments in leading private businesses, Back Market and Epsilogen.

Introduction

Economic backdrop

Interest rate expectations accelerated at the start of the quarter as a result of elevated price inflation caused by Russia's invasion of Ukraine. In turn, the potential for recession in coming quarters increased. Against this backdrop, the equity markets saw a marked rotation into large cap defensive stocks, notably commodity producers, and out of mid-cap and growth stocks - in particular those not currently generating positive cashflow.

Portfolio composition and valuation reviews

As of 31 December 2021, the Company had 35 portfolio holdings1 including 11 quoted holdings and 24 unquoted holdings. During the period, the number and composition of holdings was impacted by the following events:

· New investment in Back Market (incorporated as Jung S.A.S).

· New investment in Epsilogen Ltd ("Epsilogen")

· Sale of Seedrs Ltd ("Seedrs")

As of 31 March 2022, the Company ended the period with 36 holdings1 including 11 quoted holdings and 25 unquoted holdings. All the Company's quoted holdings were valued using unadjusted quoted prices. For the unquoted holdings, the Alternative Investment Fund Manager ("AIFM") considered any material 'triggering' events since the last valuation assessment as of 31 December 2021 and as such conducted four valuation reviews to determine the fair value of the portfolio as of 31 March 2022.

1 Excluding 9 holdings with no value.

Recent developments

On 6 June 2022, the Company announced that the Board of Directors of Rutherford Health plc ("Rutherford"), a private oncology provider based in the UK and a portfolio company, has resolved to take steps to wind-up the company and appoint the official receiver as liquidator. The Company's holding in Rutherford was valued at £22.8 million as at 31 March 2022. As it is uncertain if the liquidation process will result in proceeds for the Company, the Company's AIFM will write-off the book value of the holding effective as at 6 June 2022, the date of the announcement of the initiation of the winding-up of Rutherford Health plc. The write-off will reduce the Company's NAV per share by 2.5p.

Financial Performance

Source: AIFM as of 31 March 2022.

The NAV as of 31 March 2022 was £359.6 million or 39.57p per share reflecting a decrease of 17.7% compared with the NAV as of 31 December 2021.

The quarterly NAV return of -17.7% comprised:

· Quoted holdings: -19.1%

· Unquoted holdings: +1.2%

· Foreign exchange: +0.6%

· Costs and other movements: -0.4%

Portfolio

The Company's quoted holdings saw a decline in value of 34.3% contributing -19.1% to the quarterly change in NAV. The most significant detractor from performance in Q1 was Oxford Nanopore which declined by 43% over the period, reducing NAV per share by 7.7p. Factors affecting the stock included a broader sectoral rotation from growth to value stocks, and fears of a potential stock overhang following the expiry of the post-IPO lockup period at the end of March. From an operational perspective the company continued to enhance its technology offering and expanded its commercialisation capabilities, and at its full year results in March it made material upgrades to its forward revenue guidance.

The two other material detractors in the quoted portfolio were IDEX Biometrics and Immunocore which declined by 40% and 13% respectively. Both companies continued to deliver on their commercial plans. IDEX announced the first commercial launch of bank cards utilising its biosensor technology and expects at least another 10 launches over the course of 2022. Immunocore received FDA approval for its lead therapeutic, a landmark which also provided evidence of effectiveness for Immunocore's wider platform. However, neither company is currently profitable, and both were impacted by the wider market rotation from growth to value. We made a partial realisation of our position in Immunocore during the quarter.

The Company's unquoted holdings saw an increase in value of 2.7% contributing +1.2% to the quarterly change in NAV. The only material change was an uplift in the valuation of BenevolentAI to account for progress in its business combination with Odyssey Acquisition S.A. ("Odyssey"), a Euronext Amsterdam-listed investment company, which completed after the period end. The AIFM increased the valuation of the holding by £7.2 million from £28.5 million as of 31 December 2021 to £35.7 million as of 31 March 2022. After the first day of trading on 25th April 2022, the value of the Company's holding was £39.6 million (€47.1 million) reflecting a further fair value increase of £3.9 million from 31 March 2022. Assuming sufficient secondary market liquidity, BenevolentAI will henceforth be valued using its unadjusted quoted price which will be reflected in the Company's daily indicative unaudited NAV per share.

Foreign Exchange

During the quarter, the fair value of investments denominated in the United States Dollar (USD), Euro (EUR), Norwegian Krone (NOK), Swiss Franc (CHF) and Australian Dollar (AUD) benefited from the depreciation in the relative value of the British pound sterling (GBP). Overall, changes in foreign exchange rates contributed +0.6% to the quarterly decrease in NAV.

Cash, debt, and net current assets

As of 31 March 2022, the Company held £5.3 million in cash with the bank overdraft undrawn.

Investment Activity

Realisations

During the quarter, the Company made one full realisation and two partial realisations totalling £23.6 million.

In March 2022, the Company completed the sale of its holding in Seedrs Limited ("Seedrs") to a global institutional investment management firm receiving cash proceeds of £12.0 million. For further information on the transaction, investors can refer to the original announcement made by the Company on the 1st December 2021.

The Portfolio Manager also trimmed two of the Company's quoted holdings to fund new investments in private companies and repayment of the bank overdraft.

New Investments

During the quarter, the Company made two new private equity investments totalling £11.5 million.

Back Market

In January 2022, the Company invested €12.0 million (£10.0 million) in leading renewed electronics marketplace, Back Market (incorporated as Jung S.A.S.), as part of its $510 million Series E funding round. The round was led by Sprints Capital, together with Eurazeo Growth, Aglaé Ventures, General Atlantic, and Generation Investment Management. The Company invested alongside its co-investment partner, Sprints Capital, via a single asset fund, Sprints Capital Ellison LP.

Launched in 2014, Back Market is the leading dedicated renewed technology marketplace. The company brings high-quality professionally refurbished electronic devices and appliances to customers in 16 countries including the United Kingdom, the United States, France, Germany, Italy, Spain, Belgium, Austria, the Netherlands, and more recently, Portugal, Japan, Finland, Ireland, Greece, Slovakia, and Sweden. The Series E round underpins Back Market's ambitious vision and allows the company to build on its position as the leading marketplace exclusively dedicated to the sale of expertly refurbished electronics. Back Market is determined to make circular technology mainstream by delivering an experience even better than buying new.

Epsilogen

In March 2022, the Company committed £3.0 million to leading immunoglobulin E ("IgE") antibodies developer, Epsilogen, as part of its £30.75 million Series B funding round. The round was led by a new investor, Novartis Venture Fund, and joined by new investors 3B Future Health Fund, British Patient Capital, and Caribou Property. The new syndicate joins founding Series A investor Epidarex Capital and Series A investor ALSA Ventures both of whom also committed further capital in the Series B fundraising.

Epsilogen is a global leader in the development of immunoglobulin E (IgE) antibodies to treat cancer. IgE's natural function is to provide immunological defence against certain parasites. This functionality makes it an ideal treatment of solid tumours due to its strong potency, enhanced tumour access and long tissue half-life. Epsilogen's lead product candidate, MOv18 IgE, is the first therapeutic IgE antibody to enter the clinic and encouraging data from a phase I trial demonstrated MOv18 IgE to be safe and well tolerated with early signs of clinical activity also seen. Epsilogen is also developing a proprietary IGEGTM antibody platform combining elements from both IgE and IgG antibodies into novel and proprietary antibody molecules with enhanced functionality.

As of 31 March 2022, the Company had invested £1.5 million of its total commitment of £3.0 million with the undrawn amount (£1.5 million) expected to be called in two subsequent tranches in the first quarter of 2023 and in the first quarter of 2024.

Follow-on Investments

During the quarter, the Company made follow-on commitments totalling £1.6 million.

In the second quarter, the Company committed £1.5 million to Rutherford as part of a £4.5 million fundraise to extend its runway while in the process of securing long-term funding. The new commitment was structured in two equal size tranches with the first tranche drawn immediately and the second tranche, subject to certain conditions and at the discretion of the Company, potentially to be drawn in June 2022. As some of those conditions were not met, the second tranche of £0.75 million was not drawn and the Company will not make any further investments into Rutherford. Since Schroders Investment Management plc assumed the portfolio management of the Company in December 2019, a total of £3.75 million of bridge funding has been invested into Rutherford as part of a restructuring plan which included the recruitment of a new leadership team in an effort to preserve some value of the significant historical investment made by the Company into Rutherford. While the new leadership team vigorously pursued multiple options over the last months to save the business, it could ultimately not correct the inherited severe underlying challenges in the business.

Top 10

The Company's top 10 holdings as of 31 March 2022 compared with the respective holding as of 31 December 2021.

Source: AIFM as of 31 March 2022.

Outlook

There remains considerable global uncertainty currently with a variety of headwinds emerging since the start of the year. These include the Ukraine war which has tragic consequences from a human perspective but is also having a significant economic impact. There are material secondary consequences from increases in the costs of energy, labour and agricultural commodities. We are also seeing a further lockdown in China because of the re-emergence of Covid and this continues to exacerbate supply chain disruptions that have plagued the global economy for the last two years. We continue to envisage that public markets will be more volatile in the near term as markets adjust to changing conditions, and this may also have an impact on the pace of activity in private markets.

The Company continues to be well placed to capitalise on new investment opportunities in both public and private equity markets, and in keeping with our recent announcement to shareholders, the proposed expansion of our investment remit to a global one will enable the Company to invest into the best opportunities, when viewed on a risk return basis, no matter where they are in the world, which enhances and deepens our opportunity set and leverages the global capabilities and access that Schroders benefits from.

As indicated in the Chairman's Statement in the annual report, the board has begun to purchase the Company's own shares for cancellation. Since 9 May 2022, the Company has bought back a total of 250,000 shares, all of which will be cancelled, and the board will continue to utilise the buyback authorities given by shareholders at the Annual General Meeting to purchase shares.

We are encouraged by the Portfolio's progress over the period with two new investments in exciting Private Companies in addition to one realisation and two partial realisations. However, we do not downplay the macroeconomic challenges highlighted above, and there are still several stock specific situations in the inherited portfolio where we continue to focus our time to maximise return potential. That said, the Company is now in a far more stable position with capital available to continue to make investments as we continue to rebalance the portfolio. We are excited about the prospects for the future now that the hard work put in by the team since taking over management of the Company is beginning to bear fruit.

Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. The securities shown above are for illustrative purposes only and are not to be considered a recommendation to buy or sell.

Enquiries:

Schroder Investment Management Limited