TIDMRMII TIDMTTM

RNS Number : 8151I

RM Infrastructure Income PLC

21 April 2022

RM INFRASTRUCTURE INCOME PLC

(the "Company" or "RMII")

FINAL RESULTS

CONTINUED DIVERSIFICATION THROUGH REFRESHED INVESTMENT FOCUS

STABLE RETURNS FOR INVESTORS ALONGSIDE TANGIBLE BENEFITS FOR PEOPLE AND PLANET

RMII, the investment trust specialising in secured debt investments, announces its results for the year ended 31 December 2021.

Operational highlights

- Diversified portfolio with gross assets of GBP130.8 million invested across 34 loans, 12 sectors and 16 sub-sectors

- RM Funds further accreditation by the British Business Bank as an accredited lender for the RLS with RMII as a funding partner

- Portfolio benefits from enhanced credit quality with 25.5% invested into partially government guaranteed Coronavirus Business Interruption Loan Scheme (CBILS) and Recovery Loan Scheme (RLS)

- Portfolio credit metrics improved over the year as measured by the proportion of senior loans and CBILS / RLS vs. junior debt totalling 60.2% vs. 46% as at the year ended 31 December 2020

   -      Exposure to target social and environmental infrastructure sectors now 50.8% of NAV 

- New loans and further drawdowns from existing facilities totalled GBP29.7 million during the year with repayments & divestments totalling GBP39.7 million

- The Good Economy published its first full Impact Assessment Report for RMII. Key findings include:

o Weighted average portfolio impact score rose from 18.56 as at July 2021 to 22.4 as at March 2022

o Loans within the RMII portfolio have supported the creation of 1,115 jobs

o 99% invested outside of London compared to the industry average of 65%

Financial Highlights

- 6.5 pence dividend for full year continuing track record of having met or exceeded dividend target since IPO (total dividend distributions since IPO totalling 30.725 pence per ordinary share)

   -      Dividend fully covered by earnings 1.01 times 
   -      NAV total return for the year 7.6% 
 
                                   Year ended 31    Year ended 31 
                                    December 2021    December 2020 
 Gross asset value (GBP'000)       GBP130,821       GBP132,822 
                                  ---------------  --------------- 
 NAV per Ordinary Share (pence)    94.41p           93.26p 
                                  ---------------  --------------- 
 Ordinary Share price (pence)      95.00p           87.00p 
                                  ---------------  --------------- 
 Ordinary Share price premium 
  to NAV                           0.6%             (6.7%) 
                                  ---------------  --------------- 
 Total return - Ordinary Share 
  NAV and dividends                +7.6%            +3.1% 
                                  ---------------  --------------- 
 

Outlook

- Strengthened commitment to investing in Social & Environmental Infrastructure sectors with high quality pipeline transaction

- Legal claim ongoing to recover costs associated with cladding replacement and loss of income to date within wholly owned student accommodation asset in Coventry

- Ongoing reduction of watchlist through successful outcomes - releasing further valuation adjustments as those loans are marked back to par. Provisions totalling GBP4.3 million or c.3.6 pence per ordinary share

- Well-placed to offer fixed income returns with limited exposure to interest rate risk due to the short duration and high-yielding nature of the portfolio (weighted average life of the loan book reduced to 2.23 years vs. 3.04 years as at the year ended 31 December 2020 and weighted average yield of 8.54%)

- Enhanced partnership with The Good Economy to provide reputable third-party assurance for ESG & Impact reporting

Norman Crighton, Chairman of RMII, commented:

"The Board is pleased to report a strong performance for the year. Providing support to underserved UK companies who make positive contributions to society underpins all that we do. We are pleased with the progress made in further aligning our portfolio to our target social & environmental infrastructure sectors, which are both strongly aligned with UN SDG goals. Through our partnership with The Good Economy and our active ESG engagement with management teams, we remain confident we can deliver triple bottom line returns to our investors: stable economic returns combined with a tangible positive impact for people and planet.

The challenges facing the global environment are widely reported, particularly the crisis in Ukraine where our thoughts remain with all those impacted. Alongside having no exposure to Russia or Ukraine, we have a defensive investment focus uncorrelated to global equity markets and hold a clear focus on real assets with limited duration exposure. We therefore have every confidence the portfolio is well-positioned to navigate this uncertainty and will continue to deliver for our investors. We look forward to 2022 with optimism and remain focused on getting back to trading a premium to NAV. With a strong pipeline and through our collective expertise, we firmly believe the best days remain ahead for RMII."

Investor webinar

An investor webinar will be held this afternoon at 2.00 pm, hosted by James Robson (Chief Investment Officer, RM Funds) and Thomas Le Grix De La Salle (Co-Portfolio & Investment Manager, RM Funds). If you would like to join the webinar, please contact Tulchan for more details.

For further information, please contact:

 
 RM Funds - Investment Manager 
  James Robson 
  Thomas Le Grix De La Salle 
  Pietro Nicholls                                    0131 603 7060 
 Singer Capital Markets Advisory LLP - Financial 
  Adviser and Broker 
  James Maxwell 
  Asha Chotai                                        020 7496 3000 
 Peel Hunt LLP - Financial Adviser and Broker 
  Luke Simpson 
  Liz Yong                                           020 7418 8900 
 Tulchan Communications LLP - Financial PR           0207 353 4200 
  Elizabeth Snow                                      RMII@tulchangroup.com 
  Oliver Norgate 
 Sanne Fund Services (UK) Limited - Administrator 
  and Company Secretary 
  Brian Smith 
  Ciara McKillop                                     020 3327 9720 
 

ANNUAL REPORT AND ACCOUNTS

For the year ended 31 December 2021

About us

RM Infrastructure Income plc ("RMII" or the "Company") aims to generate attractive and regular dividends through investment in secured debt instruments of UK Small and Medium sized Enterprises ("SMEs") and mid-market corporates including any loan, promissory notes, lease, bond, or preference share (such debt instruments, as further described in the Annual Report, being "Loans") sourced or originated by RM Capital Markets Limited (the "Investment Manager") with a degree of inflation protection through index-linked returns where appropriate.

PORTFOLIO AT A GLANCE

Operational highlights

> Diversified portfolio with gross assets of GBP130.8 million invested across 34 loans and one wholly owned asset, across 12 sectors and 16 sub-sectors

> RM Funds further accreditation by the British Business Bank as an accredited lender for the RLS with RMII as a funding partner

> 25.5% of the portfolio invested into partially government guaranteed CBILS & RLS eligible loans

> Approximately 50.6% of the portfolio NAV is invested into Social & Environmental Infrastructure sectors with a strong pipeline and expectation that allocations to these areas in 2022 will further increase as the portfolios maturing investments are recycled within those core sectors

> The Good Economy annual impact report assessment noted that weighted average portfolio impact score rose from 18.56 as at July 2021 to 22.4 as at March 2022 and that loans within the RMII portfolio have supported the creation of 1,115 jobs

Financial highlights

> 6.5 pence dividend for full year meeting target set at IPO

> Dividend fully covered by earnings 1.01 times

> NAV total return for the year 7.6%

 
 
                                            Year ended         Year ended 
                                            31 December 2021   31 December 2020 
-----------------------------------------  -----------------  ----------------- 
 Gross asset value (GBP'000)(1)             GBP130,821         GBP132,822 
 Net Asset Value ("NAV") (GBP'000)          GBP111,250         GBP110,384 
 NAV per Ordinary Share (pence)             94.41p             93.26p 
 Ordinary Share price (pence)               95.00p             87.00p 
 Ordinary Share price premium/(discount) 
  to NAV(1)                                 0.6%               (6.7%) 
 Ongoing charges(1)                         1.92%              1.91% 
 Gearing (net)(1)                           14.6%              18.3% 
 Accrued entitlement of Zero Dividend 
  Preference ("ZDP") Share (pence)(2)       -                  109.87 
 

Performance Summary

 
                                       % change(3,5)  % change(4,5) 
-------------------------------------  -------------  ------------- 
 Total return - Ordinary Share NAV 
  and dividends(1)                     +7.6%          +3.1% 
 Total return - Ordinary Share price 
  and dividends(1)                     +16.7%         -5.3% 
 

(1) These are Alternative Performance Measures ("APMs").

(2) Based on the net assets attributable to the ZDP Shares as at 31 December 2020. The Final Capital Entitlement in respect of the ZDPs was paid to ZDP Shareholders on 6 April 2021 following which the ZDPs and its listing were cancelled.

(3) Total returns for the year to 31 December 2021, including dividend reinvestment.

(4) Total returns for the year to 31 December 2020, including dividend reinvestment.

(5) Source: Bloomberg.

Alternative Performance Measures ("APMs")

The financial information and performance summary data highlighted in the footnote to the above tables are considered to represent APMs of the Company. Definitions of these APMs together with how these measures have been calculated can be found in the Annual Report.

Portfolio (as at 31 December 2021)

Largest 10 loans by drawn amounts across the entire portfolio

 
Business activity                          Investment type                        Valuation    Percentage 
                                            (Private/Public/Bond)                   GBP'000            of 
                                                                                              gross asset 
                                                                                                      (%) 
===============================  =================================  =======================  ============ 
Asset finance                              Private loans                             10,194          7.80 
Hotel                                      Private loans                              8,504          6.50 
Automotive parts manufacturing             Private loans                              8,321          6.40 
Care home                                  Private loans                              7,788          6.00 
Gym franchise                              Private loans                              7,215          5.50 
Hotel                                      Private loans                              6,491          5.00 
Student accommodation                      Private loans                              5,000          3.80 
Care home                                  Private loans                              5,000          3.80 
Hotel                                      Private loans                              4,875          3.70 
Healthcare                                 Bond                                       4,493          3.40 
Ten largest holdings                                                                 67,881         51.90 
Wholly owned asset                                                                    3,600          2.80 
Other private loan investments                                                       47,847         36.50 
Bond investments                                                                      7,346          5.60 
==================================================================  =======================  ============ 
Total holdings                                                                      126,674         96.80 
Other net current assets                                                              4,147          3.20 
Gross assets*                                                                       130,821         100.0 
==================================================================  =======================  ============ 
 

* The Company's gross assets comprise the net asset values of the Company's Ordinary Shares, accrued capital entitlement of the ZDP Shares and the Bank loan.

Valuation conducted by external Valuation Agent.

Full portfolio (as at 31 December 2021)

 
 Loan    Borrower        Deal Type    Sector           Business        Nominal       Market        Valuer     Payment 
  Ref#    Name                                         Description      (GBP)         Value 
                                                                                      (GBP) 
         Private Loan    Bilateral    Asset Backed     Asset Backed 
    60    - SPV           Loan         Lending          Lending         10,193,916    10,193,916   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    66    - SPV           Loan        Leisure          Hotel             8,504,440     8,504,440   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                         Syndicated                    Auto Parts 
    39   Beinbauer        Loan        Manufacturing    Manufacturer      8,320,583     8,320,583   V Agent    PIK/Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                         Bilateral                     Health and 
    76   Gym Franchise    Loan        Healthcare       Well-being        7,799,555     7,214,588   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral 
    88    - SPV           Loan        Healthcare       Care home         7,787,776     7,787,776   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    67    - SPV           Loan        Leisure          Hotel             6,490,560     6,490,560   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    80    - SPV           Loan        Leisure          Hotel             5,000,000     4,450,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral 
    82    - SPV           Loan        Healthcare       Care home         5,000,000     5,000,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    86    - SPV           Loan        Leisure          Hotel             5,000,000     4,875,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral                     Student 
    89    - SPV           Loan        Accommodation    accommodation     5,000,000     5,000,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                         Bilateral                     Other 
    62   Trent Capital    Loan        Manufacturing    Manufacturing     4,661,351     4,428,283   V Agent    PIK 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                         Syndicated                    Specialist 
     6   Elysium          Loan        Healthcare       Care              4,500,000     4,365,000   External   Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                                                       Specialist 
    15   Voyage Care     Bond         Healthcare       Care              4,500,000     4,493,250   External   Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral 
    79    - SPV           Loan        Construction     Construction      4,500,000     4,005,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Asset Backed     Asset Backed 
    61    - SPV           Loan         Lending          Lending          4,469,939     4,469,939   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral                     Student 
    12    - SPV           Loan        Accommodation    accommodation     4,420,000     4,420,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    73    - SPV           Loan        Leisure          Hotel             4,000,000     4,000,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral                     Student 
    84    - SPV           Loan        Accommodation    accommodation     4,000,000     4,000,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Coventry 
         Student                                       Student 
    68   Accommodation   Equity       Accommodation    accommodation     3,600,000     3,600,000   V Agent    N/A 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                                                       Specialist 
    16   Voyage Care     Bond         Healthcare       Care              3,000,000     2,852,685   External   Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Asset Backed     Invoice 
    64    - SPV           Loan         Lending         Finance           2,750,000     2,750,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral 
    83    - SPV           Loan        Healthcare       Care home         2,589,102     2,589,102   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    92    - SPV           Loan        Leisure          Hotel             2,458,629     2,188,180   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Childcare 
    91    - SPV           Loan         & Education     School            2,000,000     2,000,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    58    - SPV           Loan        Leisure          Hotel             2,000,000     1,460,000   V Agent    PIK 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                         Syndicated   Transport        Ports 
    71   Euroports        Loan         Assets          business          1,681,661     1,679,559   External   Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral                     Student 
    74    - SPV           Loan        Accommodation    accommodation     1,671,038     1,671,038   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Hotel & 
    69    - SPV           Loan        Leisure          Hotel               900,000       855,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Commercial 
    87    - SPV           Loan         Property        Restaurant          782,623       782,623   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Trent Capital 
          (Fusion)       Bilateral                     Other 
    63    RF              Loan        Manufacturing    Manufacturing       699,545       199,335   V Agent    PIK 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                         Bilateral                     Health and 
  76.1   Gym Franchise    Loan        Healthcare       Well-being          584,392       540,563   V Agent    PIK 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral    Energy           Energy 
    78    - SPV           Loan        Efficiency       Efficiency          500,000       500,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
         Private Loan    Bilateral                     Wealth 
    81    - SPV           Loan        Finance          Management          500,000       500,000   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                                                       Renewable 
         Private Loan    Bilateral                     heat 
     9    - SPV           Loan        Clean Energy     incentive           255,978       255,978   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                                                       Renewable 
         Private Loan    Bilateral                     heat 
    52    - SPV           Loan        Clean Energy     incentive           231,429       231,429   V Agent    Cash 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
                                                       Total           130,352,517   126,673,827 
        --------------  -----------  ---------------  --------------  ------------  ------------  ---------  --------- 
 

MARKET

Market environment

Overall credit conditions remained benign with modest volatility in the credit indices over 2021, although post year end this changed as the Russian invasion of Ukraine caused credit markets to widen dramatically. The Bank of England has signalled that over GBP20 billion of corporate credit will be divested over 2022 and 2023, this combined with strong inflation prints is putting pressure on government and corporate bonds. Our expectation is that yields will continue to rise, as despite their recent poor performance, the UK 10 year government bond still yields 1.65% as at the end of March 2022 which is historically very low and in our view could still move materially higher. The gilt curve remains flat in the long end and our expectation is that long end yields rising from a low level as at the end of March of 1.8% would cause material price declines in long dated corporate and government bonds and is a significant market risk.

Market opportunities

With inflation currently moving dramatically higher and yields rising, as described above, the opportunities focused on by the Investment Manager ("RM" or "RM Funds") are loans with a 3 year or less maturity. These loans suit our borrowers as typically they do not wish to fix in relatively expensive funding for long periods and it suits the Company as we wish to keep fixed rate exposures short. In addition, there are a number of opportunities where loans with coupons linked to the Bank of England base rate or Sonia linked loans can be made; these are our preference in this environment and where borrowers have the ability to pass on inflation costs within their income from fees, leases or other payment mechanisms.

The Good Economy - Impact Report

April 2022

The Good Economy ("TGE") has been engaged by the Company as the Impact Reporting and Assurance Partner since 2021. Initially TGE undertook a baseline assessment of the investment portfolio and this was communicated to investors in September 2021:

https://rm-funds.co.uk/wp-content/uploads/2021/09/RM-Infrastructure-Income-Impact-Update-Sept-2021.pdf

In April 2022, they released their first full Impact Assessment Report for the Company:

https://rm-funds.co.uk/rm-infrastructure-income/investor-relations

Results:

> In terms of impact management, RMII is fully geared towards finding investment opportunities that align with deeper focus on social and environmental infrastructure.

> RMII has seen an increase of 4% in the last 6 months in terms of alignment of the portfolio by value with RMII's target sectors and impact objectives.

> Of the investments which do not cause harm, all are classified as 'B' or 'C' investments, either benefiting stakeholders or contributing to solutions.

> RMII has seen an increase in the average portfolio impact score from 18.56 to 22.40 in the last 6 months. The average across the portfolio for only those investments which align to RMII's Impact Objectives is 43.22.

> RMII's loans are estimated to have supported approximately 1,115 jobs. The majority of these are in the construction industry with up to 390 construction jobs directly resulting from RMII's loans and a further 430 jobs generated in the supply chain (indirect jobs). The loans supporting investee's operations could support approximately 295 jobs with just over half of these supported directly and the remaining 48% supported in the supply chain.

> RMII continues to be more regionally distributed than the average private debt fund, with 99% of the value of live loans in the UK being invested outside of London compared to the industry average of 65%.

Strengths:

> RMII has a strong regional footprint providing support to SMEs across the UK, including in regions which are otherwise underserved from a 'good jobs' perspective. This has included proactive support to businesses requiring finance to survive the challenges of the coronavirus pandemic and recover afterwards.

> Half of RMII's portfolio is now aligned with the new focus on social and environmental infrastructure sectors, with a clear line of sight to contributing to Sustainable Development Goal ("SDG") achievement in the UK, monitored through an Impact Measurement and Management ("IMM") Framework which incorporates consideration of investor contribution.

> RMII has demonstrated a commitment to providing high levels of transparency in terms of reporting impact performance. Through ongoing performance reporting, RMII regularly shares information

on how the Company is meeting its stated impact objectives. RMII is transparent not only in sharing its results but also in sharing methodologies which incorporate market relevant frameworks such as the Impact Management Project's ABC spectrum which RMII use to discern and describe the full scope of its impacts.

> RMII has made good progress in formalising its approach to ESG and impact management. Processes have been put in place to translate high-level impact goals and intentions into actionable, investment specific ESG and impact activities.

Recommendations to maximise impact

> RMII should continue to build on its progression during 2021-22 to reduce exposure to 'legacy' sectors such as Hotel & Leisure and re-deploy into Healthcare, Childcare & Accommodation, along with Environmental Assets.

> RMII could consider introducing time-bound milestones against which the portfolio can be held to account in terms of the pace of this rotation. In addition, RMII should set a target date for 100% of the portfolio to be aligned with the new Impact Objectives.

> Over time, RMII should consider shifting towards assessing deals not just on their own merits, but in relation to the over-arching portfolio goals.

> RMII should be aware of potential tensions or inter-linkages between SDGs, especially those that are not directly aligned to their Impact Objectives.

> During screening, RMII should clearly articulate the way in which business activities contribute to the SDGs (whether through avoiding harmful practices, benefiting stakeholders through positive societal outcomes, or directly contributing towards addressing the most pressing social and environmental issues).

CHAIR'S STATEMENT

This year marks the fifth year since the Company's Initial Public Offering ("IPO") on the London Stock Exchange in December 2016 and it is particularly pleasing that since the IPO to 31 December 2021 the Company has generated investors a total percentage NAV total return of 30.7%, which equates to an annualised percentage NAV total return of 5.6%.

Introduction

On behalf of the Board, I am pleased to present the annual report and financial statements of the Company for the year ended 31 December 2021. The performance of the Company in 2021 has been overshadowed by subsequent events in Ukraine. I am sure that the Board, the Investment Manager, our Shareholders and all of the people involved with RMII were shocked by the Russian aggression and support the actions of the international community, aimed at bringing the occupation to an end as quickly as possible. The investment mandate of RMII is focussed on the UK and none of our investment were directly affected. However, the international sanctions are influencing global trade, and the consequences of that are now unknown. We will keep Shareholders informed of any changes to the portfolio through the usual channels.

The year saw a recovery in the NAV per Ordinary Share of the Company as valuation adjustments largely taken during March 2020 were partially released during 2021. In March 2020 the Investment Manager stated that these adjustments, they believed, would be temporary and it is pleasing to see the adjustments being partially reversed which has demonstrated the robust approach to underwriting (and valuations) taken by the Investment Manager. There are further valuation adjustments totalling GBP4.3 million or 3.64 pence per Ordinary Share, which are largely from the three companies within enhanced monitoring and the Investment Manager is focused on ensuring these positions satisfactorily exit enhanced monitoring, which is their base case scenario.

Furthermore, post year end there have been two valuation adjustments. The first of GBP1.5 million was taken to reflect the cost of cladding replacement within the wholly owned student accommodation asset in Coventry. These replacement costs were received in March 2022 and taken in the March 2022 NAV, however under accounting principles this cost is recognised as an adjusting event in the 2021 results. Further detail on this asset can be found in the Investment Manager's report under the enhanced monitoring section. The second was to an accrual taken in January 2022 that has been moved to Dec 2021 for GBP199,500.

During the year, the Company changed its name to reflect the narrower investment focus, and good progress has been made on rotating sector allocations into the target sectors and we look to continue this into 2022.

Income generation and NAV performance

In the five years since IPO, the Company has returned to Shareholders 30.725 pence per Ordinary Share in dividends which have been entirely covered by earnings.

On 22 February 2022, the Company declared a fourth quarterly dividend for the year of 1.625 pence per Ordinary Share, which was paid on 25 March 2022, thus total dividends of 6.5 pence per Ordinary Share were declared or paid for the year ended 31 December 2021.

At 31 December 2021, the NAV per share was 94.41 pence per Ordinary Share (2020: 93.88 pence). The NAV percentage per Ordinary Share total return for the year was 7.6% (2020: 3.1%) and annualised over 2020 and 2021 gives a 5.4% (2020: 11.6%) per annum NAV total return. Since inception the NAV percentage total return on an annualised basis has been 5.6%.

Returns to Shareholders

The closing mid-market share price on 31 December 2021 and 31 December 2020 were 95.0 pence and 87.0 pence respectively, being an 8 pence per Ordinary Share increase, which combined with dividends, means the total percentage share return for the year was 16.7% (2020: -5.3%).

Historically, the share price of the Company has traded at a premium to NAV, however as the pandemic took hold the share price fell to a significant discount to NAV. The Board and the Investment Manager have taken a number of steps to reduce this discount, one of which was share buy backs. The lowest price paid was 72.5 pence per Ordinary Share on 7 April 2020 and since the share buy backs started the Company has acquired 4,383,593 Ordinary Shares, which are held in treasury. It is our target during 2022 to regain the premium rating of the shares to NAV and then the Company will look to reissue these treasury shares into the market at a premium to NAV.

Portfolio overview

The overall portfolio size remained largely unchanged during the year, closing at GBP130.8 million (2020: GBP132.8 million) across 34 loans and one wholly owned asset (2020: 35 loans).

Eight new loans were made during the year alongside further drawdowns from existing facilities and there were repayments and divestments totalling GBP39.7 million. The weighted average life of the portfolio reduced from 3.04 years to 2.23 years which is reflective of the desire to keep duration relatively short as we move into a more inflationary environment.

Overall, the credit quality of the portfolio improved as the percentage of the portfolio benefiting from the Coronavirus Business Interruption Loan Scheme ("CBILS") or Recovery Loan Scheme ("RLS") increased from c.11% to c.26% and the amount invested with junior or holding company debt reduced from c.54% to c.39%. The Investment Manager's report will go into further detail, however, it is pleasing to note that the list of borrowers under enhanced monitoring reduced from four to three.

Committed to responsible investing

The Board and the Investment Manager have long been committed to high ESG standards and to responsible investing. The refreshed investment focus towards social and environmental infrastructure sectors enhances this commitment through investment in assets at the forefront of providing essential services to society. The Investment Manager's Responsible Investing Investment Policy ensures that these considerations are integrated into each individual investment process and the alignment of the portfolio to achieving contributions towards outcomes linked to UN Sustainable Development Goals 3, 4, 7, 11, 12 and 13.

The Board and the Investment Manager seek to understand and report to investors on the impact their capital has made to society and the planet and have engaged with The Good Economy ("TGE") as the impact reporting and assurance partner for RMII. During 2021, TGE undertook a baseline assessment of the portfolio which was released as an Impact Update in September 2021 and their first Impact Report will be released during the second quarter of 2022 as a follow up to this.

The Company will continue to target social good, and transactions closed during 2021 have contributed to 200 newly constructed aged care beds in the North West of England coming to the market. These beds are much needed for our growing ageing population combined with the desire to house our elderly in modern, fit for purpose accommodation. We seek to continue this in 2022 and believe that funding from the Company can continue to make positive contributions to people and the planet. I look forward to reading TGE Impact Report and seeing areas identified of strength and where we can make improvements on our journey to be the very best with regard to socially responsible investing.

Outlook

At the end of 2020 I noted that the outlook for 2021 was promising and it is pleasing to see the actual results for the year deliver on this. Many of the valuation adjustments that were taken as mark to market losses in March 2020 have now been released and it is testament to the underwriting process and ongoing loan management process of the Investment Manager that these potential losses did not materialise. It is encouraging that the outlook of the portfolio is positive and that the Investment Manager is seeking to have further credit provisions released through the successful resolution of the three loans under enhanced monitoring. Finally, it is pleasing to see the credit quality of the portfolio improve as measured by partial government guarantees and the portfolio composition of junior and holding company debt

Looking into the future we set ourselves three clear targets:

1. Return to a premium rating as measured by the share price versus the Company's NAV;

2. Seek overall NAV growth during the year after target dividend distributions; and

3. Continue to deliver on the Company's dividend target of 6.5 pence per Ordinary Share

The Company is well placed to offer investors fixed income returns with limited exposure to interest rates due to the short portfolio duration. Price rises are feeding through to everyday life with energy prices now a daily topic on news and media channels and inflation seems to be more permanent than central banks initially expected. Government bond yields still seem surprisingly low within this context and there are clear risks to fixed income prices should we see any shocks to government bond prices. How stock markets react in such an environment is not clear but one thing we can expect is an increase in volatility. The Company's strategy of focusing on real assets with limited duration exposure is one that we think should be very relevant to investors at this point in time.

I look forward to continued engagement with Shareholders; please do not hesitate to contact me through Singer Capital Markets or Peel Hunt if any additional information is required.

Norman Crighton

Chair

20 April 2022

INVESTMENT MANAGER'S REPORT

Strong and sustainable NAV & income performance

Over the course of the year, the portfolio generated a NAV total return of 7.6%, with total dividend distributions attributable to Shareholders for the year totalling 6.5 pence per Ordinary Share. Overall, the NAV per Ordinary Share increased from 93.26 pence per Ordinary Share at 31 December 2020 to 94.41 pence per Ordinary Share at 31 December 2021. In the two years from January 2020 (prior to the global pandemic lockdowns) to the year end, the Company has generated annualised NAV percentage total returns of 5.4% per annum, demonstrating the stable income and capital preservation which the Company is seeking to deliver for Investors.

Post year end and due to the necessary accounting treatment of an "adjusting event", as the costs of the cladding replacement at the Coventry Student Accommodation (Loan reference 68) became known, the value of the asset has been marked lower. Further commentary is made in the Portfolio Performance section below. In essence the inadequate nature of the cladding was deemed to have been in existence at year end so whilst the costs became known in March 2022, the year end NAV has been adjusted to reflect the position in March 2022.

Following the year end a quarterly dividend in respect of the period from 1 October 2021 to 31 December 2021 was declared on 22 February 2021 and paid to Shareholders on the 25 March 2022. These dividends totalling 6.5 pence per Ordinary Share for the year ended 31 December 2021 bring the total distributions since the Company's launch in December 2016 to 30.725 pence per Ordinary Share, exceeding the 30.0 pence per Ordinary Share targeted over the first five years by the Investment Manager.

Share price performance

The year saw a combination of strong NAV per share performance combined with the narrowing of the share price discount from 6.7% at the year ended 31 December 2020 to a premium of 0.6% at the year ended 31 December 2021. These factors generated a total percentage share return for the year of 16.1%. Since IPO the total percentage share return achieved is 29.6% which is annualised since inception at 5.5% per annum.

Market environment

Generic credit spreads were stable with the benchmark Markit ITraxx Crossover index opening and closing the year at around 240bps with relatively modest volatility seen in the credit index during the year. The year was dominated by the race between the COVID-19 variants and the vaccines, with the markets overall believing that the COVID-19 pandemic was moving into an endemic phase allowing markets to advance with most stock exchanges ending up 10% or more.

Energy costs and supply chain issues leading to very elevated inflation readings became the focus for the market. Overall, it was a weak period for fixed income with the 10-year UK government bond price falling c.10% as yields rose from the historically tight levels of 0.25% to the still historically tight level of 1% by year end. As we look into 2022 it is likely that there will be further upwards pressure on government bond yields as inflationary pressures remain and central banks move into a tightening phase. This gives an overall negative outlook for general fixed income markets as the direction of global government bond yields appears to be higher.

Credit spreads will likely move wider over the coming year largely as the Bank of England has signalled that its GBP20 billion of holdings in corporate bonds will be sold during 2022 and 2023. It is likely that credit spread widening will be exacerbated as these sales will be into a market that is likely itself reducing in size as investors are themselves reducing fixed income holdings. Liquid corporate bond funds are therefore likely to underperform due to a combination of credit spread widening combined with an increase in government bond yields. The Investment Manager believes RMII is well positioned with its short duration portfolio which is focused on attractive assets with higher yields than those available within the public markets.

Portfolio performance

Portfolio credit metrics improved over the year as measured by the proportion of senior loans and CBILS/RLS versus junior debt. As at the year end the portfolio was 60.2% invested within these types of loans versus 46% at the year ended 31 December 2020. The average life of the loan book reduced to 2.23 years as at the year-end (3.04 years 31 December 2020) reflecting a strategic decision for the duration of the portfolio to remain as short as practically possible. Such short duration minimises exposure to these continued inflationary pressures described above and is a key reason why RMII should offer an attractive proposition as an alternative credit investment versus more traditional corporate bond funds that typically are lower yielding with longer durations. As we move into an environment where central banks are now moving to an interest rate raising bias RMII's high yielding, short duration portfolio should outperform more liquid, lower yielding, and longer duration corporate bond alternatives.

As at 31 December 2021 the overall number of holdings within the portfolio remained relatively stable with 34 loans and one wholly owned asset (2020: 35 loans) and total invested capital of GBP132 million (2020: GBP131 million).

Total income generation for the year was GBP11.2 million (2020: GBP10.9 million) and this was split between cash interest of GBP9.3 million and GBP2 million of Payment In Kind ("PIK"), 82%/18% which was largely similar to 2020. Our expectation for 2022 is that the PIK/cash ratio will reduce, and this is largely due to loan references 39 and 76.

> Loan reference 39, the Auto Parts Manufacturer: during 2020 and 2021, this borrower elected to PIK the whole loan which was more expensive for them but within the original loan agreement. This has now returned to 50% cash / 50% PIK which was the original loan term.

> Loan reference 76, the Gym Franchise: this was allowed to PIK interest for periods during 2020 and 2021; however since September 2021 has returned to cash pay.

Total operating costs were GBP2.611 million; these were slightly above budget as the costs for addressing the issues of the Coventry student accommodation asset were charged to the P&L during the year.

Revolving Credit Facility ("RCF") and other finance charges were GBP0.797 million.

Total costs for the year were GBP3.408 million and when set against the income allowed for the dividend to be fully covered.

   Income                 GBP11,164,361 
   Total expenses   (GBP2,609,594) 
   Finance costs      (GBP797,585) 
   Total                    GBP7,757,182 
   Dividends           (GBP7,667,385) 
   Profit                   GBP89,797 

There were four dividends paid or declared in respect of the year ended 31 December 2021 totalling 6.5 pence per Ordinary Share.

   Period                  Payment date                   Dividend paid 
   Q1 2021                25 June 2021                     GBP1,916,603 
   Q2 2021                24 September 2021         GBP1,916,603 
   Q3 2021                30 December 2021           GBP1,916,603 
   Q4 2021                25 March 2022                   GBP1,914,916 

It was an active year for the portfolio with eight new investments totalling GBP21.7 million, drawdowns to existing facilities and re-investments totalling GBP16.9 million and several repayments and divestments that totalled GBP39.7 million during the year. The exposure to core sectors as measured by their commitments increased to 47.5% as at 31 December 2021 vs 47% as of 31 December 2020.

Overall portfolio valuations have credit provisions worth approximately GBP4.3 million or 3.64 pence per Ordinary Share. There are three investments within the portfolio that have enhanced monitoring either due to having the largest provisions or due to the complex nature of the situation:

1.Trent Capital (Loan reference 62 & 63)

This loan is to a company focused on the manufacture of zero carbon home heating products: air source heat pumps and electric boilers. It is estimated that 31% of UK carbon reduction comes from domestic heating and hot water and RM sees the support of these businesses operating in this sector as key to meeting carbon reduction targets. This loan also has a property portfolio providing significant additional collateral. This loan is due for repayment post period end and RM is working with the borrower to realise asset sales to facilitate the loan repayment. Credit provisions total GBP1.05 million.

2. Hotel Development & Contractor Glasgow (Loan reference 58, 79, 80 & 92)

This hotel is scheduled to open in June 2022 and is to be operated by Virgin Hotels under a 35 year Hotel Management Agreement. The total market value exposure that is correlated to the outcome of this asset is currently 11% of Company net assets. Credit provisions total GBP1.85 million.

3. Purpose Built Student Accommodation "PBSA" Coventry (Loan reference 68)

This asset is wholly owned by RMII and has had delays to being income generative due to issues with getting the recommissioning approval from the fire department. These issues largely relate to the works conducted by the original scheme architect and main contractor and are being addressed so that students can take occupation for the 2022/2023 academic year. These costs have been substantial over the year with the total administration costs and refurbishment costs to date being circa GBP500,000. These costs have been charged to the P&L. Extensive work has been undertaken over the last quarter of 2021 with fire specialists to examine the costs to rectify any non-compliant building work.

There is a requirement to rectify cladding issues and stairwell issues which will require further expenditure and these contractor costs were received towards the end of March. These costs were significantly higher than expectations with the quotes received indicating that the total cost of cladding replacement and remedial works would be a further GBP1.5m and the accounting treatment of such costs is that they are an "adjusting event". This means that as the building was non-compliant as at the year-end and despite these costs being not known at the time, the Dec 31st NAV has been adjusted to reflect the lowering of the asset value to reflect these costs. These costs will form part of the legal claim via the original loan documentation collateral warranties. This claim is ongoing and Shareholders will be kept informed as and when the case claim progresses. The provision is GBP1.5m as the asset was written down to reflect these additional remedial costs and further costs have been incurred during 2021 which have been charged to the Profit and Loss Account.

Coronavirus Business Interruption Loan Scheme ("CBILS") & Recovery Loan Scheme ("RLS")

These schemes were introduced by the British Government and administered by the British Business Bank and were designed to provide support to corporates affected by the pandemic. The support is via partial loan guarantees made to accredited lenders. The key features are that the UK Government provides a maximum 80% guarantee (70% for RLS Loans originated in 2022, 80% for RLS Loans originated in 2021) to eligible loans and in addition for CBILS loans, the UK Government pays the first year's interest in the form of Business Interruption Payment ("BIP"). The Investment Manager was accredited as a funder under both CBILS & RLS and RMII was designated as a funding partner. As at the year-end, 25.5% (2020:11.4%) of the portfolio was invested into CBILS & RLS eligible loans. This is a material credit enhancement for the portfolio. The same robust credit assessment process is followed for these loans.

Responsible investing

The Investment Manager is a signatory to the Principals for Responsible Investment ("PRI"). The PRI defines responsible investment as a strategy and practice to incorporate environmental, social and governance factors in investment decisions. The Investment Manager incorporates ESG criteria early on as part of the investment process and in addition there is active engagement wherever possible with portfolio Companies to help them improve their ESG processes. In practice this is delivered by the RM Funds Responsible Investing Investment Policy which is integral to RM Fund's business philosophy as we believe we can make a difference. This policy framework applies to all investment made by the Investment Manager and is governed by our principles and our commitments:

Our principles

> Respect for the internationally proclaimed human rights principles, equal opportunity independent of gender, race or religion; freedom of association and the right to bargain collectively;

>Working conditions that surpass basic health and safety standards;

> The conduct of good governance practices, in particular in relation to bribery and conflicts of interest; and

> Environmental responsibility and responsibility to active climate change engagement.

Our commitments

> Integrate the above principles into our decision-making process, by carefully considering ESG issues associated with any potential investment during the due diligence phase;

> Encourage portfolio companies to follow the above principles by implementing governance structures that provide appropriate level of oversight and by seeking disclosure on ESG issues;

> Provide ESG training and support to RM Fund's employees involved in the investment process, so that they may perform their work in accordance with the above principles and with this policy;

> Seek to be transparent in our efforts to integrate ESG considerations in investments and annually report on progress towards implementing the above principles;

> Comply with national and other applicable laws; and

> Help promote the implementation of the above principles; consider our alignment with other related conventions and standards set by Invest Europe, the UN Global Compact Initiative and the UN Principles for Responsible Investment (PRI); continuously strive to improve ESG performance within RM Funds and our portfolio companies.

Investment Manager aligned to investor interests

At the IPO, the Investment Manager purchased 500,000 Ordinary Shares and in line with the commitment to investors made at IPO, the Investment Manager has regularly purchased Ordinary Shares directly in the secondary market. This is an ongoing commitment and by purchasing RMII shares, the Investment Manager has shown a significant alignment of its interests with Shareholders. In addition to this, the management team and parties connected to the management team own additional shares.

The Investment Manager has continued to purchase Ordinary Shares of the Company during the year and at the year-end, the Investment Manager owns 1,279,125 Ordinary Shares in RMII, which is an increase of 37,500 Ordinary Shares over the year. Following the year-end, the Investment Manager acquired 12,500 Ordinary Shares of 1 pence each in the Company and the Investment Manager's total holding of Ordinary Shares is currently 1,291,625.

Outlook for 2022

The focus for the Investment Manager is to see the watchlist reduce through successful outcomes which in turn will see the release of valuation adjustments as those loans are marked back to par. Linked to these resolutions is the further rotation of the portfolio into RMII's core sectors.

The proportion of the book with floating rate coupons linked to the underlying interest rate will be increased over 2022 thus allowing the portfolio maturity to increase without increasing its duration. Furthermore, this will provide additional income if interest rates move materially higher, which is now our base case scenario.

Overall conditions are very positive for the strategy and the portfolio, with a more supportive overall operating environment as COVID-19 restrictions are relaxed. Quantitative Tapering ("QT") will support higher margins for lending as net capital is coming out of the credit and fixed income markets as described above which signifies higher lending rates due to more competition for capital. Additionally, the short duration book will allow capital to be invested without significant risk from interest rate rises.

Finally, the Investment Manager is keen to see issuance from the portfolio of sustainability linked loans where the coupons have meaningful margin ratchets if certain pre-agreed conditions are met that contribute to improved borrower ESG and sustainability outcomes.

RM Capital Markets Limited

20 April 2022

INVESTMENT POLICY, RESULTS AND OTHER INFORMATION

Investment objective

The Company aims to generate attractive and regular dividends through investment in secured debt instruments of UK SMEs and mid-market corporates and/or individuals including any loan, promissory notes, lease, bond, or preference share (such debt instruments, as further described below, being "Loans") sourced or originated by the Investment Manager with a degree of inflation protection through index-linked returns where appropriate.

Investment policy

The Company will seek to meet its investment objective by making investments in a diversified portfolio of Loans to UK SMEs and mid- market corporates, special purpose vehicles and/or to individuals. These Loans will generally be, but not limited to, senior, subordinated, unitranche and mezzanine debt instruments, documented as loans, notes, leases, bonds or convertible bonds. Such Loans shall typically have a life of 2-10 years. In certain limited cases, Loans in which the Company invests may have equity instruments attached, ordinarily any such equity interests would come in the form of warrants or options attached to a Loan. Typically, the Loans will have coupons which may be fixed, index-linked or LIBOR linked.

For the purposes of this investment policy, UK SMEs include entities incorporated outside of the UK provided their assets and/ or principal operations are within the UK. The Company is permitted to make investments outside of the UK to mid-market corporates.

Loans will be directly originated or sourced by the Investment Manager who will not invest in Loans sourced via or participations through, peer-to-peer lending platforms.

Loans in which the Company invests will be predominantly secured against assets such as real estate or plant and machinery and/or income streams such as account receivables.

The Company will make Loans to borrowers in a range of Market Sectors within certain exposure limits which will vary from time to time, according to market conditions and as determined by the Board, subject to the Investment Restrictions set out below.

The Company will at all times invest and manage its assets in a manner which is consistent to the spreading of investment risk.

Investment restrictions

The following investment limits and restrictions will apply to the Company's Loans and business which, where appropriate, shall be measured at the time of investment or once the Company is fully invested:

   >      the amount of no single Loan shall exceed 10% of Gross Assets; 
   >      exposure to a single borrower shall not exceed 10% of Gross Assets; 
   >      loans will be made across not less than four Market Sectors; 

> not less than 70% of Gross Assets will be represented by Loans denominated in sterling or hedged back to sterling;

   >      loans made to borrowers in any one Market Sector shall not exceed 40% of Gross Assets; 

> loans with exposure to project development/construction assets shall not exceed 20% of Gross Assets;

> the Company will not provide Loans to borrowers whose principal business is defence, weapons, munitions or gambling;

> the Company will not provide Loans to borrowers which generate their annual turnover predominantly from tobacco, alcohol or pornography; and

   >      the Company will not invest in other listed closed-ended funds. 

In the event of a breach of the investment guidelines and restrictions set out above, the Investment Manager shall inform the Board upon becoming aware of the same and if the Board considers the breach to be material, notification will be made to a Regulatory Information Service and the Investment Manager will look to resolve the breach with the agreement of the Board.

The Company intends to conduct its affairs so as to qualify as an investment trust for the purposes of section 1158 of the Corporation Tax Act 2010, and its investment activities will therefore be subject to the restrictions set out above.

Borrowing and gearing

The Company intends to utilise borrowings for investment purposes as well as for share buybacks and short-term liquidity purposes. Gearing represented by borrowings, including any obligations owed by the Company in respect of an issue of zero dividend preference shares (whether issued by the Company or any other member of its group) or any third-party borrowings, will not, in aggregate exceed 20% of Net Asset Value calculated at the time of drawdown.

Hedging and derivatives

The Company may invest in derivatives for efficient portfolio management purposes. In particular the Company can engage in interest rate hedging. Loans will primarily be denominated in sterling, however the Company may make limited Loans denominated in currencies other than sterling and the Board, at the recommendation of the Investment Manager, may look to hedge any other currency back to sterling should they see fit.

In accordance with the requirements of the UK Listing Authority, any material change to the Company's investment policy will require the approval of Shareholders by way of an ordinary resolution at a general meeting.

RM ZDP plc

RM ZDP plc ("RM ZDP"), a public limited company incorporated under the laws of England and Wales was incorporated on 21 February 2018 as a wholly owned subsidiary of the Company, established solely for the purpose of issuing ZDP Shares of GBP 0.01 each. RM ZDP raised gross proceeds of GBP10,869,950 through the issue of ZDP Shares.

The Company announced on 29 March 2021 that its ZDP shares would come to the end of their 3-year life on 6 April 2021, with a final capital entitlement payable of approximately GBP12.1 million (110.91p per ZDP Share). Subsequently, a General Meeting was held on 6 April 2021, where all resolutions were duly passed, including the special resolution to approve the voluntary winding up of the Company. The payment of the Final Capital Entitlement was made to ZDP shareholders on 6 April 2021 and the cancellation of the Company's listing took place on 7 April 2021.

Dividend policy

Dividends are expected to be declared by the Directors in May, August, November and February of each year in respect of the preceding quarter with dividends being paid in June, September, December and March.

The last dividend in respect of any financial year is declared prior to the relevant annual general meeting. Therefore, it is declared as a fourth interim dividend and no final dividend is payable. The Board understands that this means that Shareholders will not be given the opportunity to vote on the payment of a final dividend. However, the Board believe that the payment of a fourth interim dividend as opposed to a final dividend is in the best interests of Shareholders as it provides them with regularity on the frequency of dividend payments and avoids the delay to payment which would result from the declaration of a final dividend. A resolution will be put forward at the Annual General Meeting to approve the policy of declaring and paying all dividends of the Company as interim dividends.

The Company targeted an annualised dividend yield in excess of 6.5% for the financial year to 31 December 2021.

Investors should note that the targeted annualised dividend yields are targets only and not profit forecasts and there can be no assurance that either will be met or that any dividend growth will be achieved.

Results and dividend

The financial statements include the results of the Company. The Company revenue return after tax for the year ended 31 December 2021 amounted to GBP7,742,000 (2020: GBP7,216,000). The Company made a capital profit after tax of GBP1,263,000 (2020: capital loss of GBP5,355,000). Therefore, the total return after tax for the Company was GBP9,005,000 (2020: GBP1,861,000).

The first interim dividend of 1.625p per Ordinary Share was declared on 26 May 2021 in respect of the period from January to March 2021. The second interim dividend of 1.625p per Ordinary Share for the quarter ended 30 June 2021 was declared on 6 August 2021 and the third interim dividend of 1.625p per Ordinary Share for the quarter ended 30 September 2021 was declared on 2 November 2021. On 22 February 2022, the Board declared a fourth interim dividend of 1.625 pence per Ordinary Share for the quarter to 31 December 2021.

Key performance indicators ("KPIs")

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

   (i)    Dividends 

The Company has paid or proposed four interim dividends totalling, in aggregate, 6.5 pence per Ordinary Share, equivalent to 6.5% based on the Ordinary Share issue price of GBP1 per share at Admission. The targeted annualised dividend yield of 5.4% has therefore been met during the year.

   (ii)   Total return 

The Company's total return is monitored by the Board. The Ordinary Shares generated a NAV total return of 7.6% (2020: +3.1%) in the year ended 31 December 2021.

(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 Ordinary Share price closed at a 0.6% premium (2020: discount of 6.7%) to the NAV as at 31 December 2021. To address the discount due to the impact of COVID-19 in 2021, 523,294 Ordinary Shares were bought back during the year at prices ranging from 86.0 pence and 94.0 pence per Ordinary Share. This added 0.42 pence per Ordinary Share to the NAV.

(iv) Control of the level of ongoing charges

The Board monitors the Company's operating costs. Based on the Company's average net assets for the year ended 31 December 2021, the Company's ongoing charges figure calculated in accordance with The Association of Investment Companies ("AIC") methodology was 1.92% (2020: 1.91%).

RISKS 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 Management Engagement Committee (the "Committee"). The Committee periodically carries out a robust assessment of principal and emerging risks and uncertainties and monitors the risks on an ongoing basis. 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. The experience and knowledge of the Board is invaluable to these discussions, as is advice received from the Board's service providers, specifically the Alternative Investment Fund Manager ("AIFM") who is responsible for the risk and portfolio management services and outsources the portfolio management to the Investment Manager. The Committee has a dynamic risk matrix in place to help identify key risks in the business and oversee the effectiveness of internal controls and processes.

The Committee continues to be concerned with the risks posed by the COVID-19 pandemic which has a significant impact on all risk categories. In addition to implementing more regular reviews of investment performance with the Investment Manager, the Committee has worked closely with the Company's key service providers to ensure high standards of service were maintained whilst hybrid working models were implemented. 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 in the following paragraphs.

   (i)    Market risks 

Availability of appropriate investments

There is no guarantee that loans will be made in a timely manner.

Before the Company is able to make or acquire loans, the Investment Manager is required to complete necessary due diligence and enter into appropriate legal documentation. In addition, the Company may become subject to competition in sourcing and making investments. Some of the Company's competitors may have greater financial, technical and marketing resources or a lower cost of capital and the Company may not be able to compete successfully for investments. Competition for investments may lead to the available interest coupon on investments decreasing, which may further limit the Company's ability to generate its desired returns.

If the Investment Manager is not able to source a sufficient number of suitable investments within a reasonable time frame whether by reason of lack of demand, competition or otherwise, a greater proportion of the Company's assets will be held in cash for longer than anticipated and the Company's ability to achieve its investment objective will be adversely affected. To the extent that any investments to which the Company is exposed prepay, mature or are sold it will seek to reinvest such proceeds in further investments in accordance with the Company's investment policy.

Market sectors

Loans will be made to borrowers that operate in different market sectors each of which will have risks that are specific to that particular market sector.

Management of risks

The Company has appointed an experienced Investment Manager who directly sources loans. The Company is investing in a wide range of loan types and sectors and therefore benefits from diversification.

Investment restrictions are relatively flexible giving the advisor ability to take advantage of diverse loan opportunities.

The Investment Manager, AIFM, Brokers and the Board review market conditions on an ongoing basis. Geopolitical instability may threaten global economic growth and, consequently the Company's portfolio and regrettably this view has been justified following the invasion of Ukraine.

   (ii)   Risks associated with meeting the Company's investment objective or target dividend yield 

The Company's investment objective is to generate attractive and regular dividends through investment in loans sourced or originated by the Investment Manager and to generate capital appreciation by virtue of the fact that the returns on some loans will be index-linked. The declaration, payment and amount of any future dividends by the Company will be subject to the discretion of the Directors and will depend upon, amongst other things, the Company successfully pursuing the investment policy and the Company's earnings, financial position, cash requirements, level and rate of borrowings and availability of profit, as well the provisions of relevant laws or generally accepted accounting principles from time to time.

Management of risks

The Investment Manager has a well-defined investment policy and process which is regularly and rigorously reviewed by the independent Board of Directors and performance is reviewed at quarterly Board meetings. The Investment Manager is experienced and employs its expertise in making investments in a diversified portfolio of loans. The Investment Manager has a target portfolio yield which covers the level of dividend targeted by the Company. The Board reviews the position at board meetings.

(iii) Financial risks

The Company's investment activities expose it to a variety of financial risks which include liquidity, currency, leverage, interest rate and credit risks.

Further details on financial risks and the management of those risks can be found in note -- to the financial statements.

(iv) Corporate governance and internal control risks

The Company has no employees, and the Directors have all been appointed on a non-executive basis. The Company must therefore rely upon the performance of third-party service providers to perform its executive functions. In particular, the AIFM, the Investment Manager, the Administrator, the Company Secretary and the Registrar, will perform services that are integral to the Company's operations and financial performance.

Poor performance of the above service providers could lead to various consequences including the loss of the Company's assets, inadequate returns to Shareholders and loss of investment trust status. Cyber security risks could lead to breaches of confidentiality, loss of data records and inability to make investment decisions.

Management of risks

Each of the above contracts was entered into after full and proper consideration of the quality and cost of services offered, including the financial control systems in operation in so far as they relate to the affairs of the Company. All of the above services are subject to ongoing oversight of the Board and the performance of the principal service providers is reviewed on a regular basis. The Company's key service providers report periodically to the Board on their procedures to mitigate cyber security risks.

   (v)   Regulatory risks 

The Company and its operations are subject to laws and regulations enacted by national and local governments and government policy. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Any change in the laws, regulations and/or government policy affecting the Company or any changes to current accountancy regulations and practice in the UK may have a material adverse effect on the ability of the Company to successfully pursue its investment policy and meet its investment objective and/or on the value of the Company and the shares. In such event, the performance of the Company, the NAV, the Company's earnings and returns to Shareholders may be materially adversely affected.

Management of risks

The Company has contracted out relevant services to appropriately qualified professionals. The Secretary and AIFM report on compliance matters to the Board on a quarterly basis and the Board has access to the advice of its Corporate Broker on a continuing basis. The assessment of regulatory risks forms part of the Board's risk assessment programme.

(vi) Business interruption and emerging risks

Failure in services provided by key service providers, meaning information is not processed correctly or in a timely manner, resulting in regulatory investigation or financial loss, failure of trade settlement, or potential loss of investment trust status. Failure to identify emerging risks may cause reactive actions rather than being proactive and the Company could be forced to change its structure, objective or strategy and, in worst case, could cause the Company to become unviable or otherwise fail.

The Board continued to be concerned with the risks posed by the COVID-19 pandemic during the year, with significant restrictions on movement of people and disruption to business operations impacting global portfolio company valuations and returns and potentially impacting the operational resilience of the Company's service providers. The impact of COVID-19 on the markets and the Company's financial position continue to be closely monitored by the Investment Manager and the Board. The Board and Investment Manager also continue to monitor the political situation in Ukraine, however the Company's portfolio has no direct exposure to Russia or Ukraine and the Company's cash position remains robust.

Management of risks

Each service provider has business continuity policies and procedures in place to ensure that they are able to meet the Company's needs and all breaches of any nature are reported to the Board.

The following is a description of the Company's service providers who assist in identifying the Company's emerging risks to the Board.

1. Investment Manager: the Investment Manager provides a report to the Board at least quarterly on industry trends, insight to future challenges in the sector, including the regulatory, political and economic changes likely to impact the Company. The Chair also has contact with the Investment Manager on a regular basis to discuss any pertinent issues;

2. Alternative Investment Fund Manager: the AIFM maintains a register of identified risks including emerging risks likely to impact the Company, which is updated quarterly following discussions with the Investment Manager and other service providers. The risks are documented on a risk register, Company in main categories: Market Risks; Risks associated with Investment Objective; Financial Risks; Corporate Governance Risks; Regulatory Risks and Emerging Risks. Any changes and amendments to the risk register are highlighted to the Board on a quarterly basis;

3. Brokers: provide advice periodically, specific to the Company on the Company's sector, competitors and the investment company market whilst working with the Board and Investment Manager to communicate with Shareholders;

4. Company Secretary and Auditor: briefs the Board on forthcoming legislation and regulatory change that might impact on the Company. The Auditor also has specific briefings at least annually;

5. The AIC: the Company is a member of the AIC, which provides regular technical updates as well as drawing members' attention to forthcoming industry and regulatory issues.

The Board regularly reviews the Company's risk matrix, focussing on risk mitigation and ensuring that the appropriate controls are in place. Regular review ensures that the Company operates in line with the risk management policy, prospectus and investment strategy. Emerging risks are actively discussed throughout the year to attempt to ensure that emerging (as well as known) risks are identified and managed so far as practicable. The experience and knowledge of the Board is invaluable to these discussions, as is advice received from the Board's service providers.

Due to the ongoing COVID-19 pandemic the Audit and Management Engagement Committee requested assurances from the Company's key service providers that business continuity plans and hybrid working arrangements had been enacted where necessary. This provided a satisfactory level of assurance that there had not been, and there was no expectation of any disruption to service quality.

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 on page --.

(vii) ESG and Climate Change

While efforts to mitigate climate change continue, the physical impacts are already emerging in the form of changing weather patterns. Extreme weather events can result in flooding, drought, fires, storm damage, potentially impairing the operations of a portfolio company at a certain location or impacting locations of companies within their supply chain. Climate change leads to additional costs and risks for portfolio companies.

There is potential reputational damage from non-compliance with regulations or incorrect disclosures.

Management of risks

The Company's ESG Policy, which is updated annually is published on the Company's website and the AIC website.

The Company's approach to ESG, including the ESG factors that are considered in the investment process, such as climate change, where they are relevant and have a material impact on stock performance, are included in the Annual Report on page --. It also includes examples of responsible engagement.

As a signatory to the Principles of Responsible Investment Initiative ("PRI"), the Investment Manager reports annually according to the PRI reporting framework. Investment trusts are currently exempt from the Task Force on Climate-Related Financial Disclosures ("TCFD") disclosure, but the Board will continue to monitor the situation.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the annual report and the financial statements in accordance with applicable United Kingdom law 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 company financial statements in accordance with UK-adopted international accounting standards. 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 and of the profit or loss of the Company for that period.

In preparing these financial statements the Directors are required to:

> select suitable accounting policies in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors and then apply them consistently;

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

> present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

> provide additional disclosures when compliance with the specific requirements of UK-adopted international accounting standards is insufficient to enable users to understand the impact of particular

transactions, other events and conditions on the financial position and financial performance;

> state whether UK-adopted international 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.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and 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.

Under applicable law and regulations, the Directors are also responsible for preparing a strategic report, Directors' report, Directors' remuneration report and corporate governance statement that comply with that law and those regulations. The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website.

Directors' confirmation statement

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

(a) the accounts, 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.

The Directors consider that the financial statements are fair, balanced and understandable and provide the information necessary for Shareholders to assess the Company's performance, business model and strategy.

For and on behalf of the Board

Norman Crighton

Chair

20 April 2022

 
 Company Statement of Comprehensive Income 
 For the year 
 ended 31 
 December 
 2021 
                                      Year ended 31 December               Year ended 31 December 
                                               2021                                  2020 
                                   Revenue        Capital     Total    Revenue        Capital     Total 
                     NOTES         GBP'000        GBP'000   GBP'000    GBP'000        GBP'000   GBP'000 
 Gains/(losses) 
  on investments       3                 -          1,263     1,263      (565)        (5,210)   (5,775) 
 Income                4            11,164              -    11,164     10,942              -    10,942 
 Investment 
  management fee       5           (1,013)              -   (1,013)    (1,088)              -   (1,088) 
 Other expenses        6           (1,598)              -   (1,598)    (1,192)          (145)   (1,337) 
-----------------  ---------  ------------  -------------  --------  ---------  -------------  -------- 
 Return before 
  finance costs 
  and taxation                       8,553          1,263     9,816      8,097        (5,355)     2,742 
 Finance costs         7             (797)              -     (797)      (635)              -     (635) 
-----------------  ---------  ------------  -------------  --------  ---------  -------------  -------- 
 Return on ordinary 
  activities before 
  taxation                           7,756          1,263     9,019      7,462        (5,355)     2,107 
 Taxation              8              (14)              -      (14)      (246)              -     (246) 
-----------------  ---------  ------------  -------------  --------  ---------  -------------  -------- 
 Return on 
  ordinary 
  activities 
  after taxation                     7,742          1,263     9,005      7,216        (5,355)     1,861 
-----------------  ---------  ------------  -------------  --------  ---------  -------------  -------- 
 Return per 
  ordinary share 
  (pence)              15            6.56p          1.07p     7.63p      5.96p        (4.43p)     1.53p 
-----------------  ---------  ------------  -------------  --------  ---------  -------------  -------- 
 
 The total column of this statement is the profit and loss account of the 
  Company. 
 All the revenue and capital items in the above statement derive from continuing 
  operations. 
 'Return on ordinary activities after taxation' is also the Total comprehensive 
  income for the year. 
 The notes form an integral part of these financial statements. 
 Statement of Financial Position 
                                                  As at 31 December         As at 31 December 
                                                               2021                      2020 
                                  Notes                     GBP'000                   GBP'000 
----------------------------  ------------  -----------------------  ------------------------ 
 Fixed assets 
 Investments at fair value 
  through profit 
  or loss                           3                       126,674                   122,705 
 Investments in subsidiary                                        -                        50 
 
 Current assets 
 Cash and cash equivalents                                    3,310                     2,218 
 Receivables                        9                         2,684                    10,498 
----------------------------  ------------  -----------------------  ------------------------ 
                                                              5,994                    12,716 
 Payables: amounts falling 
 due within 
 one year 
 Payables                          10                       (1,847)                   (2,645) 
 Intercompany loan payable         11                             -                  (11,942) 
 Bank loan - Credit facility        12                     (19,571)                  (10,500) 
                                                           (21,418)                  (25,087) 
----------------------------  ------------  -----------------------  ------------------------ 
 Net current liabilities                                   (15,424)                  (12,371) 
----------------------------  ------------  -----------------------  ------------------------ 
 
 Total assets less current 
  liabilities                                               111,250                   110,384 
----------------------------  ------------  -----------------------  ------------------------ 
 
 Net assets                                                 111,250                   110,384 
----------------------------  ------------  -----------------------  ------------------------ 
 
 Capital and reserves: 
 equity 
 Share capital                     13                         1,178                     1,184 
 Share premium                     14                        70,168                    70,168 
 Special reserve                                             44,813                    45,277 
 Capital reserve                                            (8,149)                   (9,412) 
 Revenue reserve                                              3,240                     3,167 
 Total Shareholders' funds                                  111,250                   110,384 
----------------------------  ------------  -----------------------  ------------------------ 
 NAV per share - Ordinary 
  Shares (pence)                   16                        94.41p                    93.26p 
----------------------------  ------------  -----------------------  ------------------------ 
 
 
 

The financial statements of the Company were approved and authorised for issue by the Board of Directors on 20 April 2022 and signed on their behalf by:

Norman Crighton

Chair

Registered in England and Wales with registered number 10449530.

The notes form an integral part of these financial statements.

 
 Statement of Changes in Equity 
 For the year ended 31 December 
  2021 
 
 
                                                        Share 
                                          Share       premium    Special    Capital    Revenue 
                                           capital    account    reserve    reserve    reserve     Total 
                                  Notes    GBP'000    GBP'000    GBP'000    GBP'000    GBP'000   GBP'000 
-------------------------------  ------  ---------  ---------  ---------  ---------  ---------  -------- 
 Balance as at beginning 
  of the year                                1,184     70,168     45,277    (9,412)      3,167   110,384 
 Return on ordinary activities                   -          -          -      1,263      7,742     9,005 
 Redemption of shares              13          (6)          6      (464)          -          -     (464) 
 Share buy back costs                            -        (6)          -          -          -       (6) 
 Dividend paid                     17            -          -          -          -    (7,669)   (7,669) 
 Balance as at 31 December 
  2021                                       1,178     70,168     44,813    (8,149)      3,240   111,250 
-------------------------------  ------  ---------  ---------  ---------  ---------  ---------  -------- 
 
 For the year ended 31 December 2020 
                                                        Share 
                                          Share       premium    Special    Capital    Revenue 
                                           capital    account    reserve    reserve    reserve     Total 
                                  Notes    GBP'000    GBP'000    GBP'000    GBP'000    GBP'000   GBP'000 
-------------------------------  ------  ---------  ---------  ---------  ---------  ---------  -------- 
 Balance as at beginning 
  of the year                                1,222     70,146     48,304    (4,057)      3,913   119,528 
 Return on ordinary activities                   -          -          -    (5,355)      7,216     1,861 
 Redemption of shares              13         (38)         38    (3,027)          -          -   (3,027) 
 Shares buy back costs                           -       (16)          -          -          -      (16) 
 Dividend paid                     17            -          -          -          -    (7,962)   (7,962) 
 Balance as at 31 December 
  2020                                       1,184     70,168     45,277    (9,412)      3,167   110,384 
-------------------------------  ------  ---------  ---------  ---------  ---------  ---------  -------- 
 
 Distributable reserves comprise: the revenue reserve; capital reserves 
  attributable to realised profits; and the special reserve. 
 
 Share capital represents the nominal value of shares that have been issued. 
  The share premium includes any premiums received on the issue of share 
  capital. Any transaction costs associated with the issuing of shares are 
  deducted from share premium. 
 
 The notes form an integral part of these financial statements. 
 
 
 Statement of Cash Flows 
 For the year ended 31 December 
  2021 
                                                          Year ended 31 December   Year ended 31 December 
                                                                            2021                     2020 
                                               Notes                     GBP'000                  GBP'000 
--------------------------------------------  ------  --------------------------  ----------------------- 
 Operating activities 
 Return on ordinary activities 
  before finance costs and taxation*                                       9,816                    2,742 
 Adjustment for (gains)/losses 
  on investments                                                           (823)                    5,357 
 Adjustment to amortisation costs                                            114                        - 
 Decrease/(increase) in receivables                                          484                    (958) 
 (Decrease)/increase in payables                                           (812)                      481 
 PIK adjustments to the operating 
  cash flow                                                              (2,539)                  (2,081) 
 Net cash flow from operating 
  activities                                                               6,240                    5,541 
--------------------------------------------  ------  --------------------------  ----------------------- 
 Investing activities 
 Private loan repayments/bonds 
  sales proceeds                                                          56,292                   33,479 
 Realisation of investment in 
  subsidiary - non cash adjustment                                            50                        - 
 Private loans issued/bonds purchases                                   (44,582)                 (44,435) 
 Purchase of equity investments                                          (5,100)                        - 
 Net cash flow from/(used in) 
  investing activities                                                     6,660                 (10,956) 
--------------------------------------------  ------  --------------------------  ----------------------- 
 Financing activities 
 Finance costs                                                             (684)                    (234) 
 ZDP loan principal and accumulated 
  interest paid                                                         (12,056)                        - 
 Ordinary Share buy back                          13                       (464)                  (3,027) 
 Ordinary Share buy back costs                                               (6)                     (16) 
 OakNorth loan facility drawdown                                          30,071                   17,800 
 OakNorth loan facility repaid                                          (21,000)                  (7,300) 
 Equity dividends paid                            17                     (7,669)                  (7,962) 
 Net cash flow used in financing 
  activities                                                            (11,808)                    (739) 
--------------------------------------------  ------  --------------------------  ----------------------- 
 Increase/(decrease) in cash                                               1,092                  (6,154) 
 Opening balance at beginning 
  of the year                                                              2,218                    8,372 
--------------------------------------------  ------  --------------------------  ----------------------- 
 Balance as at 31 December 2021                                            3,310                    2,218 
--------------------------------------------  ------  --------------------------  ----------------------- 
 
 * Cash inflow from interest on investment holdings was GBP9,561,000 (2020: 
  GBP8,960,000). 
 
   The notes form an integral part of these financial 
   statements. 
 
 

Changes in Financing Liabilities

 
 
 
 Movement in financial liabilities      Year ended 31 December       Year ended 31 December 
  - Company                                      2021                         2020 
                                     ---------------------------  --------------------------- 
                                        OakNorth    Intercompany     OakNorth    Intercompany 
                                        facility            loan     facility            loan 
                                         GBP'000         GBP'000      GBP'000         GBP'000 
-----------------------------------  -----------  --------------  -----------  -------------- 
 Balance as at beginning of the 
  year                                    10,500          11,942            -          11,541 
 Facility drawdowns during the 
  year                                    30,071               -       17,800               - 
 Facility interest payable during 
  the year                                   595               -          234               - 
 Facility and interest repayments 
  during the year                       (21,595)               -      (7,534)               - 
 Intercompany finance cost - 
  non cash flow                                -             114            -             401 
 Repayment of intercompany loan                -        (12,056)            -               - 
 Balance as at 31 December 2021           19,571               -       10,500          11,942 
-----------------------------------  -----------  --------------  -----------  -------------- 
 
 
 Notes to the Financial Statements 
 
 1. General information 
 
 RM Infrastructure Income plc (the "Company"), formerly RM Secured Direct 
  Lending plc, was incorporated in England and Wales on 27 October 2016 
  with registered number 10449530, as a closed-ended investment company. 
  The Company commenced its operations on 15 December 2016. The Company 
  intends to carry on business as an investment trust within the meaning 
  of Chapter 4 of Part 24 of the Corporation Tax Act 2010. 
 
 On 6 April 2021, the Company's subsidiary RM ZDP plc was placed into 
  voluntary liquidation. 
 The Company's investment objective is to generate attractive and regular 
  dividends through investment in secured debt instruments of UK SMEs 
  and mid-market corporates including any loan, promissory notes, lease, 
  bond or preference share sourced or originated by the Investment Manager 
  with a degree of inflation protection through index-linked return where 
  appropriate. 
 The registered office is 6(th) Floor, 125 London Wall, Barbican, London 
  EC2Y 5AS. 
 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 UK-adopted 
  international accounting standards. The financial statements have been 
  prepared on a historical basis, except for investments measured at 
  fair value. 
  In preparing these financial statements the directors have considered 
  the impact of climate change as a risk and have concluded that there 
  was no further impact of climate change to be taken into account. In 
  line with IAS, investments are valued at fair value and climate change 
  risk is taken into consideration on the investments we hold. 
  The Board has determined by having regard to the currency of the Company's 
  share capital and the predominant currency in which the Company operates, 
  that sterling is the functional and presentational currency. Where 
  presentational recommendations set out in the Statement of Recommended 
  Practice "Financial Statements of Investment Trust Companies and Venture 
  Capital Trusts" ("SORP"), issued in the UK by the AIC in April 2021, 
  do not conflict with the requirements of UK-adopted international accounting 
  standards ("IFRS"), the directors have prepared the financial statements 
  on a basis consistent with the recommendations of the SORP, in the 
  belief that this will aid comparison with similar investment companies 
  incorporated in the United Kingdom. 
  In accordance with the SORP, the Statement of Comprehensive Income 
  has been analysed between a revenue return (dealing with items of a 
  revenue nature) and a capital return (relating to items of a capital 
  nature). Revenue returns include, but are not limited to, investment 
  related income, operating expenses, income related finance costs and 
  taxation (insofar as they are not allocated to capital). Net revenue 
  returns are allocated via the revenue return to the Revenue reserve. 
  Capital returns include, but are not limited to, profits and losses 
  on the disposal and the valuation of non-current investments, derivative 
  instruments and on cash and borrowings, operating costs and finance 
  costs (insofar as they are not allocated to revenue). Net capital returns 
  are allocated via the capital return to Capital reserves. 
  The Company is engaged in a single segment of business, being that 
  of an investment trust company, consequently no business segmental 
  analysis is provided. 
  Dividends on Ordinary Shares may be paid out of Revenue reserve, Capital 
  reserve and Special reserve. 
  (b) Adoption of new IFRS standards 
  New standards, interpretations and amendments adopted from 1 January 
  2021 
  A number of new standards, amendments to standards and interpretations 
  are effective for the annual periods beginning after 1 January 2021. 
  None of these are expected to have a significant effect on the measurement 
  of the amounts recognised in the financial statements of the Company. 
  New standards and amendments issued but not yet effective 
  The relevant new and amended standards and interpretations that are 
  issued, but not yet effective, up to the date of issuance of the Company's 
  financial statements are disclosed below. These standards are not expected 
  to have a material impact on the entity in future reporting periods 
  and on foreseeable future transactions. 
 
  Amendments to IAS 1: Classification of Liabilities as Current or Non-current 
  In January 2020, the IASB issued amendments to paragraphs 69 to 76 
  of IAS 1 to specify the requirements for classifying liabilities as 
  current or non-current. The amendments are effective for annual reporting 
  periods beginning on or after 1 January 2023. 
 
  Reference to the Conceptual Framework - Amendments to IFRS 3 
  In May 2020, the IASB issued Amendments to IFRS 3 Business Combinations 
  - Reference to the Conceptual Framework. The amendments are effective 
  for annual reporting periods beginning on or after 1 January 2022. 
 
  Definition of Accounting Estimates - Amendments to IAS 8 
  In February 2021, the IASB issued amendments to IAS 8, in which it 
  introduces a definition of 'accounting estimates'. The amendments are 
  effective for annual reporting periods beginning on or after 1 January 
  2023. 
 
  Disclosure of Accounting Policies - Amendments to IAS 1 and IFRS Practice 
  Statement 2 
  In February 2021, the IASB issued amendments to IAS 1 and IFRS Practice 
  Statement 2 Making Materiality Judgements. The amendments to IAS 1 
  are applicable for annual periods beginning on or after 1 January 2023. 
 
   (c) Going concern 
   The Directors have adopted the going concern basis in preparing the 
   financial statements. In forming this opinion, the directors continue 
   to consider any potential impacts 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 Investment Manager, continue 
   to have in place to maintain operational resilience. Details of the 
   Directors assessment of the going concern status of the Company are 
   given in the Annual Report. 
   The Directors have a reasonable expectation that the Company has adequate 
   resources to continue in operational existence for at least twelve 
   months from the date of the Annual Report. In reaching this conclusion, 
   the Directors have considered the Company's portfolio of loan investments 
   of GBP126.7 million (2020: GBP122.7 million) and the cash position 
   of GBP3.3 million (2020: GBP2.2 million). The Company's net assets 
   at 31 December 2021 were GBP111.3 million (2020: GBP110.4 million). 
   The total expenses (excluding finance costs and taxation) for the year 
   ended 31 December 2021 were GBP2.6 million (2020: GBP2.4 million), 
   which represented approximately 1.92% (2020: 1.91%) of average net 
   assets during the year. At the date of approval of the Annual Report, 
   based on the aggregate of investments and cash held, the Company has 
   substantial operating expenses cover. 
   The Directors have concluded that there is a reasonable expectation 
   that the Company will have adequate liquidity and cash balances to 
   meet its liabilities as they fall due and continue in operational existence 
   for the foreseeable future and continue as a going concern for the 
   period to 30 June 2023. 
   (d) Investment entity status 
   The Company meets the criteria within IFRS 10 as an investment entity 
   and should therefore hold investments in subsidiaries at fair value 
   rather than consolidate them, unless those subsidiaries are not themselves 
   investment entities and their main purpose is to provide services related 
   to the Company's investment activities. 
 
 (e) Investments 
 
  Investments consist of private loans and bonds, which are classified 
  as fair value through profit or loss as they are included in the Company's 
  financial assets that are managed and their performance evaluated on 
  a fair value basis. They are initially and subsequently measured at 
  fair value and gains and losses are attributed to the capital column 
  of the Statement of Comprehensive Income. Investments are recognised 
  on the date that the Company becomes a party to the contractual provisions 
  of the instrument and are derecognised when their term expires, or 
  on the date they are sold, repaid or transferred. 
 
  Unquoted investments are valued at fair value by the Board which is 
  established with regard to the International Private Equity and Venture 
  Capital Valuation Guidelines by using, where appropriate, latest dealing 
  prices, valuations from reliable sources and other relevant factors. 
 (f) Foreign currency 
 
  Transactions denominated in foreign currencies are translated into 
  sterling at actual exchange rates as at the date of the transaction. 
  Monetary assets and liabilities and non-monetary assets held at fair 
  value denominated in foreign currencies are translated into sterling 
  using London closing foreign exchange rates at the year end. Any gain 
  or loss arising from a change in exchange rates is included as an exchange 
  gain or loss to capital or revenue in the Statement of Comprehensive 
  Income as appropriate. Foreign exchange movements on investments are 
  included in the Statement of Comprehensive Income within loss on investments. 
 
 (g) Income 
 
  Interest income is recognised in the revenue column of the Statement 
  of Comprehensive Income on an effective interest rate basis. Payment-in-kind 
  ("PIK") interest income is recognised on an accruals basis and capitalised 
  to the principal value of the loan. 
  All other income including deposit interest is accounted for on an 
  accruals basis and early settlement fees received are recognised upon 
  the early repayment of the loan. 
  Arrangement fees earned on private loan investments are recognised 
  as an income over the term of the private loans. 
 
  (h) Cash and cash equivalents 
  Cash and cash equivalents include deposits held at call with banks 
  and other short-term deposits with original maturities of three months 
  or less. 
 (i) Capital reserves 
 
  Realised and unrealised gains and losses on the Company's investments 
  are recognised in the capital column of the Statement of Comprehensive 
  Income and allocated to the capital reserve. 
 
 (j) Expenses 
 
  All expenses are accounted for on an accruals basis. 
 
  Other expenses are recognised in the revenue column of the Statement 
  of Comprehensive Income, unless they are incurred in order to enhance 
  or maintain capital profits. 
 
 Management fees and finance costs 
  The Company is expecting to derive its returns predominantly from 
  interest income. Therefore, the Board has adopted a policy of allocating 
  all management fees and finance costs to the revenue column of the 
  Statement of Comprehensive Income. 
 
  ZDP Shares finance cost 
  The ZDP Shares are designed to provide a pre-determined capital growth 
  from their original issue price of 100p on 3 April 2018 to a final 
  capital entitlement of 110.91p on 6 April 2021, on which date the RM 
  ZDP was liquidated. The provision for the capital growth entitlement 
  of the ZDP Shares is included as a finance cost and charged to revenue 
  within the Statement of Comprehensive Income. 
 (k) Taxation 
 
  The charge for taxation is based upon the net revenue for the year. 
  The tax charge is allocated to the revenue and capital columns of the 
  Statement of Comprehensive Income according to the marginal basis whereby 
  revenue expenses are first matched against taxable income arising in 
  the revenue account. 
 
  Deferred taxation will be recognised as an asset or a liability if 
  transactions have occurred at the initial reporting date that give 
  rise to an obligation to pay more taxation in the future, or a right 
  to pay less taxation in the future. An asset will not be recognised 
  to the extent that the transfer of economic benefit is uncertain. 
 (l) Financial liabilities 
 
  Bank loan facility and overdrafts are initially recorded at the proceeds 
  received net of direct issue costs and subsequently measured at amortised 
  cost using the effective interest rate. The associated costs of bank 
  loan facility are treated as revenue and amortised over the period 
  of the bank loan facility. 
 (m) Dividends 
 
  Interim dividends to the holders of shares are recorded in the Statement 
  of Changes in Equity on the date that they are paid. Final dividends 
  would be recorded in the Statement of Changes in Equity when they are 
  approved by Shareholders, however the Company currently declares four 
  interim dividends as opposed to any final dividends. 
 
 (n) Judgements, estimates and assumptions 
 
  The preparation of financial statements requires the directors to 
  make estimates and assumptions that affect the application of accounting 
  policies and the reported amounts of assets, liabilities, income and 
  expenses. 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. 
 
  The Company recognises loan investments at fair value through profit 
  or loss and disclosed in note 3 to the financial statements. The significant 
  assumptions made at the point of valuation of loans are the discounted 
  cash flow analysis and/or benchmarked discount/interest rates, which 
  are deemed appropriate to reflect the risk of the underlying loan. 
  These assumptions are monitored to ensure their ongoing appropriateness. 
  The sensitivity impact on the measurement of fair value of loan investments 
  due to price is discussed in note 20. 
 
 
 3. INVESTMENT AT FAIR VALUE THROUGH PROFIT OR LOSS 
 (a) Summary of valuation 
                                             Year ended 31 December    Year ended 31 
                                                               2021    December 2020 
                                                            GBP'000          GBP'000 
------------------------------------------  -----------------------  --------------- 
 Financial assets held: 
 Equity investments                                           3,600                - 
 Bond investments                                             7,346            2,695 
 Private loan investments                                   115,728          120,010 
                                                            126,674          122,705 
------------------------------------------  -----------------------  --------------- 
 
 (b) Movements 
                                             Year ended 31 December    Year ended 31 
                                                               2021    December 2020 
                                                            GBP'000          GBP'000 
------------------------------------------  -----------------------  --------------- 
 
 Opening valuation                                          122,705          131,201 
 Opening losses on investments                                8,276            2,919 
------------------------------------------  -----------------------  --------------- 
 Book cost at the beginning of the year                     130,981          134,120 
 Private loans issued/bonds purchases 
  at cost                                                    44,582           35,589 
 Purchase in kind interest (PIK)                              3,126            2,602 
 Purchase of equity investments                               5,100                - 
 Sales: 
   - Private loans repayments/bonds sales 
    proceeds                                               (48,962)         (41,067) 
   - Losses on investment                                   (1,763)              258 
   - Purchase in kind interest (PIK)                          (587)            (521) 
 Unrealised losses on investments held                      (5,803)          (8,276) 
 Closing valuation at year end                              126,674          122,705 
------------------------------------------  -----------------------  --------------- 
 
 Book cost at end of the year                               132,477          130,981 
 Unrealised losses on investment holdings 
  at the year end                                           (5,803)          (8,276) 
 Closing valuation at year end                              126,674          122,705 
------------------------------------------  -----------------------  --------------- 
 

The Company received GBP49.5 million (2020: GBP41.5 million) from investments sold in the year. The book cost of these investments when they were purchased was GBP41.6 million (2020: GBP41.3 million). These investments have been revalued over time and until they were sold any unrealised gains/losses were included in the fair value of the investments.

 
 (c) Gains/(losses) on investments 
                                             Year ended 31 December    Year ended 31 
                                                               2021    December 2020 
                                                            GBP'000          GBP'000 
------------------------------------------  -----------------------  --------------- 
 Realised (losses)/gains on investments                     (1,763)              258 
 Unrealised gains/(losses) on investments 
  held                                                        2,473          (5,357) 
 Foreign exchange gains/(losses)                                553            (676) 
 Total gains/(losses) on investments                          1,263          (5,775) 
------------------------------------------  -----------------------  --------------- 
 
 

At the year end, the Company had two unquoted investments;

1. Esprit Holdco Limited (Energie Fitness). The Company participated in a management buyout during 2020 and owns 28% of the business, the registered office and principal of business of Energie Fitness is 1 Pitfield Kiln Farm, Milton Keynes, United Kingdom, MK11 3LW. The Investment Manager valued holdings in Energie Fitness at nil. The equity investment in Energie Fitness meets the criteria within IFRS 10 as an investment entity and therefore is held at fair value.

2. Trent Capital Limited. The Company structured a Loan in 2019, which also offered equity within Trent Capital Limited. The Company has a 30% net equity holding within the business which is registered at 17 Walkergate, Berwick Upon Tweed, Northumberland, TD15 1DJ and the principal business address is Unit 7 Newton Chambers Way, Thornecliffe Industrial Estate, Chapeltown, Sheffield, S35 2PH. The Investment Manager valued holdings in Trent Capital Limited at nil. The equity investment in Trent Capital Limited meets the criteria within IFRS 10 as an investment entity and therefore is held at fair value.

 
 4. INCOME 
                                        Year ended 31    Year ended 31 
                                        December 2021    December 2020 
                                              GBP'000          GBP'000 
------------------------------------  ---------------  --------------- 
 Income from investments 
 Bond and loan - cash interest                  8,581            8,817 
 Bond and loan - PIK interest                   2,277            1,879 
 Arrangement fees                                 102              102 
 Delayed Compensation fees received                19               46 
 Prepayment fee                                     -               58 
 Other income                                     185               40 
                                      ---------------  --------------- 
 Total                                         11,164           10,942 
------------------------------------  ---------------  --------------- 
 
 
 5. INVESTMENT MANAGEMENT FEE 
 
                                                        Year ended     Year ended 31 
                                                  31 December 2021     December 2020 
                                                           GBP'000           GBP'000 
----------------------------------------------  ------------------  ---------------- 
 Basic fee: 
 100% charged to revenue                                     1,013             1,088 
 Total                                                       1,013             1,088 
----------------------------------------------  ------------------  ---------------- 
 
 The Company's Investment Manager is RM Capital Markets Limited. Under 
  the amended Investment Management Agreement, effective 1 April 2020, 
  the Investment Manager is entitled to receive a management fee payable 
  monthly in arrears or as soon as practicable after the end of each calendar 
  month an amount one-twelfth of; 
 (a) 0.875 per cent. of the prevailing NAV in the event that the prevailing 
  NAV is up to or equal to GBP250 million; or 
  (b) 0.800 per cent. of the prevailing NAV in the event that the prevailing 
  NAV is above GBP250 million but less than GBP500 million; or 
  (c) 0.750 per cent. of the prevailing NAV in the event that the prevailing 
  NAV is above GBP500 million. 
 The management fee shall be payable in Sterling on a pro-rata basis 
  in respect of any period which is less than a complete calendar month. 
 There is no performance fee payable to the Investment Manager. 
 
   6. OTHER EXPENSES 
                                                     Year ended 31     Year ended 31 
                                                     December 2021     December 2020 
                                                           GBP'000           GBP'000 
----------------------------------------------  ------------------  ---------------- 
 Basic fee charged to revenue: 
 Administration Fees                                           246               242 
 Auditor's remuneration: 
 Statutory audit fee                                           112                94 
 Broker Fees                                                   141               106 
 Consultancy Fees                                              138                90 
 Directors' Fees                                                99                99 
 AIFM fees                                                     151               160 
 Registrar fees                                                 41                31 
 Valuation Fees                                                 87                90 
 Other Expenses                                                583               280 
                                                                    ---------------- 
 Total revenue expenses                                      1,598             1,192 
 Expenses charged to capital: 
 Prospectus issue and capital transaction 
  costs                                                          -               145 
 Total expenses                                              1,598             1,337 
----------------------------------------------  ------------------  ---------------- 
 
 
 
 7. FINANCE COSTS 
 
                                 Year ended 31 December               Year ended 31 December 
                                          2021                                 2020 
                               Revenue   Capital        Total      Revenue       Capital     Total 
                               GBP'000   GBP'000      GBP'000      GBP'000       GBP'000   GBP'000 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 Loan arrangement fees              89         -           89          105             -       105 
 Loan Interest paid                595         -          595          129             -       129 
 ZDP Shares finance 
  costs                            113         -          113          401             -       401 
  Total                            797         -          797          635             -       635 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 
   8. TAXATION 
 
                                 Year ended 31 December               Year ended 31 December 
                                          2021                                 2020 
                               Revenue   Capital        Total      Revenue       Capital     Total 
                               GBP'000   GBP'000      GBP'000      GBP'000       GBP'000   GBP'000 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 Analysis of tax charge for the year: 
 Corporation tax                    14         -           14          246             -       246 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 Total current tax 
  charge 
  (see note 6 (b))                  14         -           14          246             -       246 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 
 (b) Factors affecting the tax charge 
  for the year: 
 The effective UK corporation tax rate for the period is 19.00% (2020:19.00%). 
  The tax charge differs from the charge resulting from applying the standard 
  rate of UK corporation tax for an investment trust company. The differences 
  are explained below: 
                                 Year ended 31 December               Year ended 31 December 
                                          2021                                 2020 
                               Revenue   Capital        Total      Revenue       Capital     Total 
                               GBP'000   GBP'000      GBP'000      GBP'000       GBP'000   GBP'000 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 Return on ordinary 
  activities 
  before taxation                7,756     1,263        9,019        7,463       (5,355)     2,108 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 UK corporation tax at 
  19.00% 
  (2020:19.00%)                  1,474       240        1,714        1,418       (1,018)       400 
 Effects of: 
 Fair value losses not 
  deductible                         -     (240)        (240)            -           990       990 
 Interest distributions 
  paid/payable                 (1,460)         -      (1,460)      (1,172)             -   (1,172) 
 Management expenses not 
  allowable                          -         -            -            -            28        28 
 Total tax charge                   14         -           14          246             -       246 
------------------------  ------------  --------  -----------  -----------  ------------  -------- 
 
 The Company is not liable to tax on capital gains due to its status as 
  an investment trust. 
 
  (c) Deferred tax 
  assets/(liabilities) 
 The Company had no recognised or unrecognised deferred asset/liability 
  as at the year end. 
 
   9. RECEIVABLES 
                                            As at 31 December                       As at 31 December 
                                                         2021                                    2020 
 Company                                              GBP'000                                 GBP'000 
--------------------------------------  ---------------------  -------------------------------------- 
 Amounts falling due within one year: 
 Repayment of investment private loans 
  receivable                                                -                                   7,330 
 Bond and loan interest receivable                      1,603                                   1,983 
 Prepayments and other receivables                      1,081                                   1,185 
                                                               -------------------------------------- 
  Total                                                 2,684                                  10,498 
--------------------------------------  ---------------------  -------------------------------------- 
 
   10. PAYABLES 
                                                Year ended 31              Year ended 31 
                                                December 2021              December 2020 
                                                      GBP'000                    GBP'000 
--------------------------------------  ---------------------  ------------------------- 
 Amounts falling due within one year: 
 Loan reserves retained                                   454                        595 
 Intercompany payable                                       -                        157 
 Taxation payable                                          14                        246 
 Other creditors                                        1,379                      1,647 
                                        --------------------- 
  Total                                                 1,847                      2,645 
--------------------------------------  ---------------------  ------------------------- 
 
 
 
  11. INTERCOMPANY LOAN 
 
                                                          As at 31 December 2021       As at 31 December 2020 
                                                                         GBP'000                      GBP'000 
 -----------------------------------------------------  ------------------------  --------------------------- 
  Intercompany loan payable 
   to RM ZDP                                                                   -                       11,541 
  Finance costs and capital 
   contribution                                                                -                          401 
                                                                                  --------------------------- 
   Total                                                                       -                       11,942 
 -----------------------------------------------------  ------------------------  --------------------------- 
 
 
    Intercompany Loan Agreement 
 
    On 29 March 2018, the Company entered into a Loan Agreement with RM ZDP 
    (the "ZDP Loan"). Pursuant to the Loan Agreement, RM ZDP lent the entirety 
    of the gross proceeds of the issue of ZDP Shares on 3 April 2018 to the 
    Company, which has been applied towards making investments in accordance 
    with the Investment Policy and for working capital purposes. 
 
  The Loan Agreement provides that, interest will accrue on the ZDP Loan 
   daily at a rate of 2% per annum, compounded annually on each anniversary 
   of Admission of the ZDP Shares and will be rolled up and paid to RM ZDP 
   along with repayment of the principal. On 6 April 2021, the Company repaid 
   principal and rolled up interest of GBP12,056,000 to RM ZDP plc. 
 
 
 12. BANK LOAN-CREDIT FACILITY 
                                                                   Year ended 31              Year ended 31 
                                                                   December 2021              December 2020 
                                                                         GBP'000                    GBP'000 
-------------------------------------------------------  -----------------------  ------------------------- 
 Oak North Bank-Credit facility                                           19,571                     10,500 
-------------------------------------------------------  -----------------------  ------------------------- 
  Total                                                                   19,571                     10,500 
-------------------------------------------------------  -----------------------  ------------------------- 
 
 

On 26 March 2021, the Company renewed and amended its revolving credit facility with OakNorth. The Company had entered into an uncommitted 90-day notice revolving loan of GBP10,500,000 ("Facility A") and a committed term revolving loan of GBP11,942,000 ("Facility B"), together with Facility A the ("Facilities") with OakNorth for the purposes set out in the credit facility agreement.

Facility A will be provided to be applied in or towards:

   --    repaying all amounts due from the Company to the OakNorth under its existing loan agreement; 
   --    funding by the Company of customer loans; 
   --    refinancing (where applicable) any customer loans made by the Company; 
   --    purchasing investments by the Company; 
   --    the provision of liquidity to the Company; and 
   --    payment of finance costs (including fees) payable under the loan. 

Facility B will be provided to be applied in or towards:

   --    repaying sums due from the Company to RM ZDP plc; 
   --    funding by the Company of customer loans; 
   --    refinancing (where applicable) any customer loans made by the Company; 
   --    purchasing investments by the Company; 
   --    the provision of liquidity to the Company; and 
   --    payment of finance costs (including fees) payable under the loan agreement. 

The rate of interest on the facilities are the aggregate of the applicable margin and base rate (subject to a base rate floor of 0.10%). The margin is 4.65% p.a. The facilities expire on 26 March 2024 .

During the year, the Company drew cumulative amount of GBP30.1 million (2020: GBP17.8 million) from the revolving credit facility and repaid cumulative amount of GBP20.0 million (2020: GBP7.3 million). The remaining balance as at 31 December 2021 amounts to GBP19.6 million (2020: GBP10.5 million).

 
 13. SHARE CAPITAL 
                                             As at 31 December 2021                 As at 31 December 2020 
                                     -------------------------------------  -------------------------------------- 
                                             No. of Shares         GBP'000         No. of Shares           GBP'000 
-----------------------------------  ---------------------  --------------  --------------------  ---------------- 
 Allotted, issued & fully paid: 
 Ordinary shares of 1p                         117,840,988           1,178           118,364,282             1,184 
-----------------------------------  ---------------------  --------------  --------------------  ---------------- 
 
 Share movement 
 The table below sets out the share movement for the year ended 31 December 
  2021. 
------------------------------------------------------------------------------------------------------------------ 
                                                                                                         Shares in 
                                                                                                          issue at 
                                                                                   Shares bought       31 December 
                                           Opening balance   Shares issued                  back              2021 
-----------------------------------  ---------------------  --------------  --------------------  ---------------- 
 Ordinary Shares                               118,364,282               -             (523,294)       117,840,988 
-----------------------------------  ---------------------  --------------  --------------------  ---------------- 
 
 At the year end, the Company has 117,840,988 Ordinary Shares in issue with 
  voting rights and 4,383,593 Ordinary Shares held in Treasury. 
 
 Ordinary Share buy backs 
 During the year, the Company bought back 523,294 Ordinary Shares for an 
  aggregate cost of GBP463,838. Since the year end no further Ordinary Shares 
  have been bought back. 
  14. SHARE PREMIUM 
 
                                          As at 31 December   As at 31 December 
                                                       2021                2020 
                                                    GBP'000             GBP'000 
  -------------------------------------  ------------------  ------------------ 
   Balance as at beginning of the year               70,168              70,146 
   Share buybacks                                         6                  38 
   Share buyback costs                                  (6)                (16) 
   Balance as at 31 December 2021                    70,168              70,168 
  -------------------------------------  ------------------  ------------------ 
 
 
 
  15. RETURN PER ORDINARY SHARE 
 Based on the weighted average of number of 117,976,668 (2020: 120,985,417) 
  Ordinary Shares in issue for the year ended 31 December 2021, the returns 
  per share were as follows: 
                                                    Year ended 31 December                  Year ended 31 December 
                                                                      2021                                    2020 
                            Revenue                Capital           Total   Revenue     Capital             Total 
---------------------  ------------  ---------------------  --------------  --------  ----------  ---------------- 
 Return per Ordinary 
  Share                       6.56p                  1.07p           7.63p     5.96p     (4.43p)             1.53p 
---------------------  ------------  ---------------------  --------------  --------  ----------  ---------------- 
 
 

There are no dilutive shares in issue.

 
 16. NET ASSET VALUE PER SHARE 
 The NAV per share is based on Company's total shareholders' funds of 
  GBP112,750,000 (2020: GBP110,384,000), and on 117,840,988 (2020: 118,364,282) 
  Ordinary Shares in issue at the year end. 
 
 Nav per ordinary share reconciliation 
 

The table below is a reconciliation between the NAV per Ordinary Share of the Company as announced on the London Stock Exchange and the NAV per Ordinary Share disclosed in these financial statements.

 
                                                                 As at 31 December 
                                    As at 31 December 2021              2020 
                                                    NAV per                    NAV per 
                                    Net assets     Ordinary    Net assets     Ordinary 
                                         (GBP)    share (p)         (GBP)    share (p) 
--------------------------------  ------------  -----------  ------------  ----------- 
 NAV as published on 15 January 
  2022/2021                        112,949,700        95.85   111,123,419        93.88 
 Tax liability adjustments                   -            -     (246,000)       (0.20) 
 DAS accrual income adjustment       (199,500)       (0.17)             -            - 
 Equity revaluation adjustment*    (1,500,000)       (1.27)             -            - 
 Share buyback adjustments                   -            -     (493,851)       (0.42) 
--------------------------------                -----------  ------------  ----------- 
 NAV as disclosed in these 
  Financial Statements             111,250,200        94.41   110,383,568        93.26 
--------------------------------  ------------  -----------  ------------  ----------- 
 

*Refer to Note 21 for a description of the equity revaluation adjustment

 
 17. DIVID 
 Total 
 dividends 
 paid                                                                       Year ended 31 December 
 in the year              Year ended 31 December 2021                                 2020 
                -----------------------------------------------  -------------------------------------------- 
                    Pence                                            Pence 
                      per                                              per 
                 Ordinary    Revenue         Capital              Ordinary    Revenue    Capital 
                    share    GBP'000         GBP'000      Total      share    GBP'000    GBP'000        Total 
--------------  ---------  ---------  --------------  ---------  ---------  ---------  ---------  ----------- 
 2020 Interim 
  - Paid 
  26 Mar 2021 
  (2019: 
  27 Mar 2020)    1.6250p      1,918               -      1,918    1.7000p      2,078          -        2,078 
 2021 Interim 
  - Paid 
  25 Jun 2021 
  (2020: 
  26 Jun 2020)    1.6250p      1,917               -      1,917    1.6250p      1,975          -        1,975 
 2021 Interim 
  - Paid 
  24 Sep 2021 
  (2020: 
  25 Sep 2020)    1.6250p      1,917               -      1,917    1.6250p      1,967          -        1,967 
 2021 Interim 
  - Paid 
  30 Dec 2021 
  (2020: 
  30 Dec 2020)    1.6250p      1,917               -      1,917    1.6250p      1,942          -        1,942 
--------------  ---------  ---------  --------------  ---------  ---------  ---------  ---------  ----------- 
 Total            6.5000p      7,669               -      7,669    6.5750p      7,962          -        7,962 
--------------  ---------  ---------  --------------  ---------  ---------  ---------  ---------  ----------- 
 
   The dividend relating to the year ended 31 December 2021, which is the 
   basis on which the requirements of Section 1159 of the Corporation Tax 
   Act 2010 are considered is detailed below: 
 
 Total                    Year ended 31 December 2021                       Year ended 31 December 
 dividends in                                                                         2020 
 relation to 
 the year 
--------------  -----------------------------------------------  -------------------------------------------- 
                    Pence                                            Pence 
                      per                                              per 
                 Ordinary    Revenue         Capital              Ordinary    Revenue    Capital 
                    share    GBP'000         GBP'000      Total      share    GBP'000    GBP'000        Total 
--------------  ---------  ---------  --------------  ---------  ---------  ---------  ---------  ----------- 
 2021 Interim 
  - Paid 
  25 Jun 2021 
  (2020: 
  26 Jun 2020)    1.6250p      1,917               -      1,917    1.6250p      1,975          -        1,975 
 2021 Interim 
  - Paid 
  24 Sep 2021 
  (2020: 
  25 Sep 2020)    1.6250p      1,917               -      1,917    1.6250p      1,967          -        1,967 
 2021 Interim 
  - Paid 
  30 Dec 2021 
  (2020: 
  30 Dec 2020)    1.6250p      1,917               -      1,917    1.6250p      1,942          -        1,942 
 2021 Interim 
  - Payable 
  25 Mar 2022 
  (2020: 
  26 Mar 2021*    1.6250p      1,915               -      1,915    1.6250p      1,918          -        1,918 
 Total            6.5000p      7,666               -      7,666    6.5000p      7,802          -        7,802 
--------------  ---------  ---------  --------------  ---------  ---------  ---------  ---------  ----------- 
 *Not included as a liability in the year ended 31 December 2021 financial 
  statements. 
 18. RELATED 
 PARTY 
 TRANSACTIONS 
 
 Fees are payable at an annual rate of GBP36,000 to the Chair, GBP33,000 
  to the Chair of the Audit and Management Engagement Committee and GBP30,000 
  to the other Director. As at 31 December 2021, there were no Directors' 
  fees outstanding. The Directors' fees are disclosed in note 7 and the 
  Directors' shareholdings are disclosed in the Directors Remuneration 
  Report in the Annual Report for the year ended 31 December 2021. 
 Fees payable to the Investment Manager are shown in the Statement of 
  Comprehensive Income. As at 31 December 2021 the fee outstanding to 
  the Investment Manager was GBP84,000 (2020: GBP93,000). 
 Arrangement fees are paid by some borrowers to the Investment Manager. 
  The amount the Investment Manager can retain from borrowers in most 
  cases is capped at 1.25% and agreed with the Board. The Company receives 
  any arrangement fees from the Investment Manager in excess of the 1.25% 
  or otherwise agreed with the borrower. During the year to 31 December 
  2021, the Company received GBP102,000 (2020: GBP102,000) in arrangement 
  fees from RM. 
 As at 31 December 2021, the Investment Manager held 1,279,125 (2020: 
  1,237,325) Ordinary Shares in the Company. 
 
 Since the year end, the Investment Manager purchased a further 12,500 
  Ordinary Shares in the Company, and as of the date of the Annual Report, 
  the Investment Manager's total holding of Ordinary Shares is 1,291,625 
  (2020: 1,249,825). 
  Significant Holdings Disclosure Requirements - Companies Act 2006 
 
  The Company holds an unquoted investment in Coventry Student Accommodation 
  1 Limited ("Coventry", the wholly owned asset). As at 31 December 2021, 
  the Company owns 100% of the business. The registered office and principal 
  place of business of Coventry is 1(st) Floor Senator House, 85 Queen 
  Victoria Street, London, United Kingdom, EC4V 4AB. The Investment Manager's 
  valuation of the holdings in Coventry is GBP3.6 million as at 31 December 
  2021. 
 
  The equity investment in Coventry meets the criteria within IFRS 10 
  as an investment entity and therefore held at fair value. 
 
  19. CLASSIFICATION OF FINANCIAL 
  INSTRUMENTS 
 
 IFRS 13 requires the Company to classify its investments in a fair value 
  hierarchy that reflects the significance of the inputs used in making the 
  measurements. IFRS 13 establishes a fair value hierarchy that prioritises 
  the inputs to valuation techniques used to measure fair value. The three 
  levels of fair value hierarchy under IFRS 13 are as follows: 
 Level 1 
 Inputs are quoted prices in active markets for identical assets or liabilities 
  that the entity can access at the measurement date. 
 
 Level 2 
 Inputs other than quoted market prices included within Level 1 that are 
  observable for the asset or liability, either directly or indirectly. 
 
 Level 3 
 Inputs are unobservable for the asset or liability. 
 
 The classification of the Company's investments held at fair value through 
  profit or loss is detailed in the table below: 
 
                                31 December 2021                                       31 December 2020 
                    Level      Level           Level                 Level                 Level        Level 
                        1          2               3      Total          1                     2            3           Total 
                  GBP'000    GBP'000         GBP'000    GBP'000    GBP'000               GBP'000      GBP'000         GBP'000 
--------------  ---------  ---------  --------------  ---------  ---------  --------------------  -----------  -------------- 
 Financial 
 assets: 
 Financial 
  assets - 
  Private 
  loans and 
  bonds                 -      7,346               -      7,346          -                25,013            -          25,013 
 Financial 
  assets - 
  Private 
  loans                 -          -         115,728    115,728          -                     -       97,692          97,692 
 Financial 
  assets - 
  Equity 
  investment            -          -           3,600      3,600          -                     -            -               - 
 Forward 
  contract 
  unrealised 
  gain                  -        137               -        137          -                   161            -             161 
 Net financial 
  assets 
  (including 
  forwards)*            -      7,483         119,328    126,811          -                25,174       97,692         122,866 
--------------  ---------  ---------  --------------  ---------  ---------  --------------------  -----------  -------------- 
  *The net unrealised gain of GBP136,729 (2020: GBP161,027) on forwards 
   is recognised within prepayments and other debtors in the Statement of 
   Financial Position. 
 
   As at 31 December 2021, the fair value of the Company's loans is materially 
   equal to the carrying value. 
 Investments that trade in markets that are not considered to be active 
  but are valued based on quoted market prices, dealer quotations or alternative 
  pricing sources supported by observable inputs are classified within Level 
  2. 
 Level 3 holdings are valued using a discounted cash flow analysis and benchmarked 
  discount/interest rates appropriate to the nature of the underlying loan 
  and the date of valuation. 
 Interest rates are a significant input into the Level 3 valuation methodology. 
  Interest rates used in the valuation range from 5.88% to 20.5% (2020: 5.3% 
  to 15.0%). Sensitivity analysis of interest rates can be found in the Annual 
  Report. 
 There have been no movements between levels during the reporting period. 
  The Company considers factors that may necessitate the transfers between 
  levels using the definition of the levels 1, 2 and 3 above. 
 
 Reconciliation of the Level 3 classification investments during the year 
  to 31 December 2021 is shown below: 
                                                                                     31 December                  31 December 
                                                                                            2021                         2020 
                                                                                         GBP'000                      GBP'000 
--------------  ---------  ---------  --------------  ---------  ---------  --------------------  -----------  -------------- 
 Balance as at beginning of the year                                                      97,692                       87,878 
 New loans during the year                                                                38,253                       38,258 
 New equity investments 
 during 
 the year                                                                                  3,600                            - 
 Repayments during the year                                                             (16,558)                     (23,905) 
 Realised (losses)/gains during the 
  year                                                                                     (832)                          545 
 Unrealised losses at the year end                                                       (2,827)                      (5,084) 
------------------------------------ 
 Closing balance as at 31 December 
  2021                                                                                   119,328                       97,692 
------------------------------------  --------------  ---------  ---------  --------------------  -----------  -------------- 
 
 
 
 20. FINANCIAL INSTRUMENTS AND CAPITAL DISCLOSURES 
 The Company invests in private loan, bond investments and an equity 
  investment. Financial instrument and capital disclosures are only 
  prepared on a Company basis as this is the basis on which reports 
  are made to the decision makers. The following describes the risks 
  involved and the applied risk management. The Investment Manager 
  reports regularly both verbally and formally to the Board, and its 
  relevant committees, to allow them to monitor and review all the 
  risks noted below. 
 
  (i) Market risks 
 The Company is subject to a number of Market risks in relation to economic 
  conditions and healthcare companies. Further detail on these risks and 
  the management of these risks are included in the Annual Report. 
 
 The Company's financial assets and liabilities at 31 December 2021 
  comprised: 
 
  Year ended 31 December 2021 Year ended 31 December 2020 
                   Interest   Non-interest                          Interest     Non-interest 
                    bearing        bearing            Total          bearing          bearing            Total 
 Investments        GBP'000        GBP'000          GBP'000          GBP'000          GBP'000          GBP'000 
--------------  -----------  -------------  ---------------  ---------------  ---------------  --------------- 
 GB sterling        116,674              -          116,674          109,354                -          109,354 
 Euro                10,000              -           10,000           13,351                -           13,351 
  Total 
   investment       126,674              -          126,674          122,705                -          122,705 
--------------  -----------  -------------  ---------------  ---------------  ---------------  --------------- 
 
 Cash and cash 
  equivalents         3,310              -            3,310            2,236                -            2,236 
 Receivables              -          2,684            2,684                -           10,515           10,515 
 Payables                 -       (21,418)         (21,418)         (10,500)          (2,634)         (13,134) 
 Intercompany 
  loan payable            -              -                -         (11,942)                -         (11,942) 
  Total             129,984       (18,734)          111,250          102,499            7,881          110,380 
--------------  -----------  -------------  ---------------  ---------------  ---------------  --------------- 
 
 Price risk sensitivity 
 The effect on the portfolio of a 10.0% increase or decrease in the value 
  of the loans and equity portfolio would have resulted in an increase or 
  decrease of GBP12,667,000 (2020: GBP12,271,000) in the investments held 
  at fair value through profit or loss at the period end date. This analysis 
  assumes that all other variables remain constant. 
 
  Given the portfolio has a weighted average life of circa 2.5 years, a 
  movement of 1bp affects the Company's portfolio values by 0.02bp (GBP220/per 
  GBP1 million). Therefore, if the discount rates were to move higher by 
  100bp across GBP131 million (gross assets as at 31 December 2021), that 
  will result in a loss to the Company's NAV of GBP2.9 million. 
 
 (ii) Credit risks 
 The Company's investments will be predominantly in the form of private 
  loans whose revenue streams are secured against contracted, predictable 
  medium to long-term cash flows and/or physical assets, and whose debt 
  service payments are dependent on such cash flows and/or the sale or refinancing 
  of the physical assets. The key risks relating to the private loans include 
  risks relating to counterparty default, senior debt covenant breach risk, 
  bridge loans, adverse credit risk spread, delays in the receipt of anticipated 
  cash flows and borrower default, and collateral risks. 
 
 The Company is also exposed to the risk of default on cash held at the 
  bank and other trade receivables. The maximum exposure to credit risk 
  on cash at bank and other trade receivables at 31 December 2021 was GBP3,310,000 
  and GBP2,684,000 respectively (2020: GBP2,236,000 and GBP10,515,000). 
  None of these amounts are considered past due or impaired and interest 
  is based on the prevailing money market rates. 
 
 The table below shows the Company's exposure to credit risks as the 
  year end. 
 
  As at 31 December 2021 As at 31 December 2020 
                                                                     Maximum                        Maximum 
                                                 Fair value         exposure       Fair value      exposure 
                                                    GBP'000          GBP'000          GBP'000       GBP'000 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 Private loan 
  investments                                       115,728          115,728          120,010       120,010 
 Equity 
  instruments                                         3,600            3,600                -             - 
 Bond 
  investments                                         7,346            7,346            2,695         2,695 
 Cash and cash 
  equivalent                                          3,310            3,310            2,236         2,236 
 Receivables                                          2,684            2,684           10,515        10,515 
 Total                                              132,668          132,668          135,456       135,456 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 
   Management of risks 
 The Investment Manager reports a number of key metrics on a monthly basis 
  to its Credit Committee including pipeline project information, outstanding 
  loan balances, lending book performance and early warning indicators. 
  The Investment Manager monitors ongoing credit risks in respect of the 
  loans. Typically, the Company's loan investments are private loans and 
  would usually exhibit credit risk classified as 'non-investment' if a 
  public rating agency was referenced. 
 
  The Company's main cash balances are held with The Royal Bank of Scotland 
  plc ("RBS"). Bankruptcy or insolvency of the bank holding cash balances 
  may cause the Company's rights with respect to the cash held by them 
  to be delayed or limited. The Company manages its risk by monitoring 
  the credit quality of RBS on an ongoing basis. 
 (iii) Interest rate risks 
 Private Loans 
 The Company may make loans based on estimates or projections of future 
  interest rates because the Investment Manager expects that the underlying 
  revenues and/or expenses of a borrower to whom the Company provides loans 
  will be linked to interest rates, or that the Company's returns from 
  a loan are linked to interest rates. If actual interest rates differ 
  from such expectation, the net cash flows of the borrower or payable 
  to the Company may be lower than anticipated. 
 
 Interest rate sensitivity 
 Interest Income earned by the Company is primarily derived from fixed 
  interest rates. The interest earned from the floating element of loan 
  and debt security investments is not significant. Based on the Company's 
  private loan investments, bond investments, cash and cash equivalents 
  as at 31 December 2021, a 0.50% increase/(decrease) in interest rates, 
  all other things being equal, would lead to a corresponding increase/(decrease) 
  in the Company's income as follows. 
                                                                                          As at 31 December 
                                                      As at 31 December 2021                           2020 
                                                                                                      0.50% 
                                             0.50% Increase   0.50% Decrease   0.50% Increase      Decrease 
                                                    GBP'000          GBP'000          GBP'000       GBP'000 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 Private loans investments                              579            (579)              488         (488) 
 Bond 
  investments                                            37             (37)              125         (125) 
 Equity 
  investments                                            18             (18)                -             - 
 Cash and cash 
  equivalent                                             17             (17)               11          (11) 
 Total                                                  648            (648)              624         (624) 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 
 Management of risks 
 The Investment Manager's investment process takes into account interest 
  rate risk. The investment strategy is to invest in private loans with 
  maturities typically between 2 and 10 years. Exposure to predominantly 
  higher yielding loans and possible floating rate investments can mitigate 
  interest rate risk to some extent. On a monthly basis, Investment Managers 
  review fixed/floating and weighted average life of the portfolio for 
  interest rate risk. 
 
 (iv) Liquidity risks 
 Liquidity risk is defined as the risk that the Company will encounter 
  difficulties in realising assets or otherwise raising funds to meet financial 
  commitments. The cash and cash equivalent balance at the year-end was 
  GBP3,310,000 (2020: GBP2,236,000). 
 
 Financial liabilities by maturity at the period end are shown 
  below: 
                                                                                  31 December   31 December 
                                                                                         2021          2020 
                                                                                      GBP'000       GBP'000 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 Within one                                                                                 -             - 
  month 
 Between one and three months                                                           1,393         2,039 
 Between three months and one year                                                          -        23,037 
 More than one year                                                                    20,025             - 
 Total                                                                                 21,418        25,076 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 
 The Investment Manager manages the Company's liquidity risk by investing 
  in a diverse portfolio of loans, secured debt instruments and an equity 
  investment in line with the Investment Policy and Investment restrictions. 
  The Investment Manager may utilise other measures such as borrowing, 
  share issues including treasury shares for liquidity purposes. 
 The maturity profile of the Company's portfolio as at the year-end is 
  as follows: 
                                                                                  31 December   31 December 
                                                                                         2021          2020 
                                                                                      GBP'000       GBP'000 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 Within one 
  month                                                                                 4,628         6,625 
 Between one and three months                                                               -             - 
 Between three months and one year                                                        855         5,394 
 More than one year                                                                   121,191       110,686 
 Total                                                                                126,674       122,705 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 
 (v) Foreign currency risks 
 Foreign currency risk is the risk that the value of a financial instrument 
  will fluctuate because of changes in foreign currency exchange rates. 
  Currency risk arises when future commercial transactions and recognised 
  assets and liabilities are denominated in a currency that is not the 
  Company's functional currency. The Company invests in debt security instruments 
  that are denominated in currencies other than sterling. 
 Accordingly, the value of the Company's assets may be affected favourably 
  or unfavourably by fluctuations in currency rates and therefore the Company 
  will necessarily be subject to foreign exchange risks. 
 Based on the financial assets and liabilities at 31 December 2021 and 
  all other things being equal, if sterling had weakened against the local 
  currencies by 10%, the impact on the Company's net assets at 31 December 
  2021 would have been as follows: 
                                                                                  31 December   31 December 
                                                                                         2021          2020 
                                                                                      GBP'000       GBP'000 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 Euro                                                                                     167           204 
 US dollar                                                                                  -            16 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 Total                                                                                    167           220 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 
 Foreign currency risk profile 
                              31 December 2021                              31 December 2020 
                 Investment   Net monetary   Total currency       Investment     Net monetary         Total 
                   exposure       exposure         exposure         exposure         exposure      currency 
                                                                                                   exposure 
                    GBP'000        GBP'000          GBP'000          GBP'000          GBP'000       GBP'000 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 
 Euro                 1,410            262            1,672            1,726              313         2,039 
 US dollar                -              4                4                -              156           156 
--------------               -------------  ---------------  ---------------  ---------------  ------------ 
 Total                1,410            266            1,676            1,726              469         2,195 
--------------  -----------  -------------  ---------------  ---------------  ---------------  ------------ 
 
 Management of currency risks 
 The Company's 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 Investment Manager 
  may hedge any currency back to sterling as they see fit. 
 
 Fair values of financial assets and liabilities 
 All financial assets and liabilities are recognised in the financial 
  statements at fair value, with the exception of short-term assets (with 
  a maturity profile of less than 12 months) and liabilities, which are 
  held at amortised cost for which fair value is given in note 20. 
 
  As at 31 December 2021, the fair value of the Company's loans is materially 
  equal to the carrying value. 
 
 Capital management 
 The Company's share capital consists of Ordinary Shares of 1 pence each, 
  its distributable reserves, which comprise Revenue reserve, Capital reserve 
  and the Special reserve. In accordance with accounting standards, the 
  Company's Ordinary Shares are considered to be equity. 
 The Company has a stated discount control policy. The Investment Manager 
  and the Company's broker monitor the demand for the Company's shares 
  and the Directors review the position at Board meetings. Further details 
  on share issues during the year and the Company's policies for issuing 
  further shares and buying back shares (including the Company's discount 
  management) can be found in the Annual Report. 
 
   During the year the Company bought back 523,294 shares (2020: 3,860,299) 
   which are held in treasury. 
 
   The Company's policy on borrowing is detailed in the Annual Report. 
 
   The details of the Company's OakNorth facilities are discussed in note 
   12. 
 21. POST BALANCE SHEET EVENTS 
 Since 31 December 2021, markets have fallen significantly with a number 
  of investor concerns impacting on stock market valuations. These include: 
  the Russian invasion of Ukraine, the continuing disruption caused by 
  Covid and the impact that rising inflation and interest rates may have 
  on the outlook for the global economy. The Company has assessed it has 
  no direct exposure to this. 
 In January 2022, RM Funds received a Fire Safety Report from Osborn Associates, 
  relating to a property owned within the wholly owned asset, which had 
  been commissioned during 2021 as a EWS1 form undertaken during 2021 concluded 
  that remedial works were required due to the fire risk of the building. 
  The Osborne Associates document focused on fire safety and compliance 
  and principally identified deficiencies with regards to the design and 
  construction of certain aspects to the building cladding. The project 
  agent put out the updated design specification to tender during Q1 2022 
  to remediate these deficiencies. These remediation costs were received 
  in late March 2022 and totalled approximately GBP1.5m including VAT. 
  These remedial works are required to make the building complaint to allow 
  safe occupation and it was decided to reduce the value of the asset by 
  these costs. As the building was in this non-compliant state as at 31 
  December 2021 it is deemed an adjustment event. Concurrent to this workstream 
  RM Funds are working with lawyers acting on behalf of RMII to lodge a 
  claim against the original scheme contractors and or consultants to recover 
  these costs. 
 
 

FINANCIAL INFORMATION

This announcement does not constitute the Company's statutory accounts. The financial information is derived from the statutory accounts, which will be delivered to the registrar of companies and will be put forward for approval at the Company's Annual General Meeting. The statutory accounts for the year ended 31 December 2020 have been delivered to the registrar of companies. The auditors have reported on the accounts for the year ended 31 December 2021 and the year ended 31 December 2020, their reports were unqualified and did not include a statement under Section 498(2) or (3) of the Companies Act 2006.

The Annual Report for the year ended 31 December 2021 was approved on 20 April 2022. It will be made available on the Company's website at https://rm-funds.co.uk/rm-infrastructure-income/investor-relations/

The Annual Report will be submitted to the National Storage Mechanism and will shortly be available for inspection at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism

This announcement contains regulated information under the Disclosure Rules and Transparency Rules of the FCA.

ANNUAL GENERAL MEETING

The Annual General Meeting will be held on 31 May 2022 at 12.00 p.m. at the offices of Singer Capital Markets Advisory LLP, 1 Bartholomew Lane, London EC2N 2AX.

20 April 2022

Secretary and registered office:

Sanne Fund Services (UK) Limited

6th Floor

125 London Wall

London

EC2Y 5AS

For further information contact:

Brian Smith / Ciara McKillop

Sanne Fund Services (UK) Limited

Tel: 020 3327 9720

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