TIDMSVM 
 
SVM UK EMERGING FUND PLC 
 
                                 (the "Fund") 
 
                              HALF YEARLY REPORT 
 
                   (FOR THE SIX MONTHS TO 30 SEPTEMBER 2020) 
 
A copy of the Half Yearly Report will be available to download from the 
Manager's website at www.svmonline.co.uk and a copy will shortly be available 
for inspection at the National Storage Mechanism at www.morningstar.co.uk/uk/ 
nsm. Copies are also available at 7 Castle Street, Edinburgh EH2 3AH, the 
registered office of the Fund. 
 
HIGHLIGHTS 
 
  * Net asset value return of 28.4% compared to a 12.8% return in the IA UK All 
    Companies Sector Average Index and 7% return in the FTSE All-Share 
    Index.The share price rose 1.4%. 
 
  * Over the five years to 30 September 2020, net asset value gained 31.4% and 
    the share price 17.4%, against a benchmark return of 17.0%. 
 
  * At 31 October 2020, net asset value per share was 104.71p 
  * Positive contributions from Ocado, 4Imprint Group, Games Workshop and Gamma 
    Communications 
 
  * Portfolio emphasises exposure to scalable businesses with a competitive 
    edge that can protect margins and deliver growth. 
 
 "Long term capital growth from investments in smaller UK companies. Its aim is 
 to outperform the IA UK All Companies Sector Average Index on a total return 
                                    basis" 
 
Financial Highlights 
 
Total Return                                                    10 Years 
Performance to     6 months        3 years        5 Years 
30 September 
2020 
 
Net Asset Value     +28.4%          -2.5%          +31.4%        +51.7% 
 
Share Price 
                     +1.4%         -11.8%          +17.4%        +44.9% 
 
Benchmark Index 
*                   +12.8%          -8.2%          +17.0%        +31.0% 
 
* The benchmark index for the Fund was changed to the IA UK All Companies 
Sector Average Index 
 
from 1 October 2013 prior to which the FTSE AIM Index was used. 
 
CHAIRMAN'S STATEMENT 
 
Over the six months to 30 September 2020, the Company's net asset value gained 
28.4% to 105.0p per share, compared to a return of 12.8% in the benchmark, the 
IA UK All Companies Sector Average Index.   Over the six months, the share 
price rose 1.4%.  Over the five years to 30 September 2020, net asset value has 
gained 31.4% and the share price 17.4%, against a benchmark return of 17.0%. 
The Company's net asset value was 104.71p] at 31 October 2020 (total return, 
Lipper data). 
 
The period under review began after a sharp stockmarket fall, resulting from 
the disruption caused by COVID-19, but over the six months many shares 
rebounded. Most portfolio investments rose following government and Bank of 
England support for the worst hit sectors. Higher unemployment remains a risk 
for the UK economy; lower inflation and interest rates are now likely.  More 
recently, market concerns with regard to a successful Brexit have resurfaced. 
 
The strongest contributions to performance over the period were from Ocado, 
4Imprint Group, Rentokil Initial, Games Workshop and Gamma Communications. 
Laggards included Workspace Group, Beazley and Creo Medical Group. During the 
six months, travel and property sector exposure was reduced; EasyJet, 
Trainline, Workspace, IWG and WH Smith were sold. New investments were made in 
manufacturing and industrial services; Avon Rubber, Aveva, and DiscoverIE 
Group. We expect many businesses to increase focus on resilience and 
sustainability; shortening supply chains and strengthening their online 
capability. 
 
The investment strategy of the Company involves focusing on growing businesses 
benefiting from structural change in the economy. Typically, these have pricing 
power within their chosen niche. Companies that were already well invested in 
technology and able to make good use of customer data have seen an acceleration 
of change this year. Businesses are demanding more enterprise support services, 
assisting cloud data, mobile services and virtual operations. Suppliers of 
these technologies were typically already disrupters in their sectors and have 
proven their agility in offering differentiated services in scalable ways. 
 
The crisis has heightened the contrast between legacy businesses and 
well-adapted agile disruptors. Changes in tastes are often slow to evolve, but 
persistent once set. At the centre of this trend is a shift in sentiment to the 
home environment and wellbeing.  This investment theme could shape the economy 
for some time and the portfolio includes a number of businesses expected to 
benefit from these trends. 
 
The portfolio focuses on resilient growing businesses, with low exposure to 
commodities, oil and banks. These are typically scalable businesses with a 
competitive edge. The Fund remains fully invested with some additional gearing. 
 
Peter Dicks 
 
Chairman 
 
6 November 2020 
 
INVESTMENT OBJECTIVE and POLICY 
 
The investment objective of SVM UK Emerging Fund plc (the "Fund" or the 
"Company") is long term capital growth from investments in smaller UK 
companies. Its aim is to outperform the IA UK All Companies Sector Average 
Index on a total return basis 
 
The Fund aims to achieve its objective and to diversify risk by investing in 
shares and related instruments, controlled by a number of limits on exposures. 
Appropriate guidelines for the management of the investments, gearing and 
financial instruments have been established by the Board. This is an abridged 
version of the Fund's investment policy.  The full investment policy can be 
found in the Strategic Report within the Fund's latest Annual Report & 
Accounts. 
 
DIRECTORS' RESPONSIBILITY STATEMENT 
 
The Directors are responsible for preparing the Half Yearly Report in 
accordance with applicable law and regulations. 
 
The Directors confirm that to the best of their knowledge: 
 
(i)        the condensed set of financial statements have been prepared in 
accordance with the Financial Reporting Council Statement 104 "Interim 
Financial Reporting" on a going concern basis, taking in to account guidance on 
Covid-19,  and give a true and fair view of the assets, liabilities, financial 
position and profit or loss of the Fund; 
 
(ii)         the Half Yearly Report includes a fair review of the information 
required by the Disclosure and Transparency Rules DTR 4.2.7R (indication of 
important events during the first six months and description of principal risks 
and uncertainties for the remaining six months of the year); and DTR 4.2.8R 
(disclosure of related party transactions and changes therein). 
 
(iii)        No related party transactions have taken place during the first 
six months of the year that have materially affected the financial position of 
the Fund during the period and there have been no changes in the related party 
transactions described in the Annual Report & Accounts for the year end 31 
March 2020 that could do so. 
 
The Directors consider that the Half Yearly Report, taken as a whole, is fair, 
balanced and understandable and provides the information necessary for 
shareholders to assess the Fund's performance and strategy, 
 
The Half Yearly Report has not been audited or reviewed by the Fund's auditors. 
 
By Order of the Board 
 
Peter Dicks 
 
Chairman 
 
6 November 2020 
 
UNAUDITED ACCOUNTS 
 
 
Income Statement 
 
 
                                Six months to 30 September  Six months to 30 September 
                                           2020                        2019 
 
                                 Revenue   Capital    Total   Revenue  Capital   Total 
 
                                   GBP'000     GBP'000    GBP'000     GBP'000    GBP'000   GBP'000 
 
Net gain on investments at             -     1,464    1,464         -       73      73 
fair value 
 
Income                                20         -       20        94        -      94 
 
Investment management fees             -      (22)     (22)         -     (26)    (26) 
 
Other expenses                      (73)         -     (73)      (45)        -    (45) 
 
(Loss)/gain before finance          (53)     1,442    1,389 
costs and taxation                                                 49       47      96 
 
Finance costs                        (5)         -      (5)      (11)        -    (11) 
 
(Loss)/gain on ordinary             (58)     1,442    1,384 
activities before taxation                                         38       47      85 
 
Taxation                               -         -        -         -        -       - 
 
(Loss)/Gain attributable to         (58)     1,442    1,384 
ordinary shareholders                                              38       47      85 
 
(Loss)/Gain per Ordinary Share   (0.96)p             23.09p     0.63p    0.78p   1.41p 
                                         24.05p 
 
 
 
                                 Year ended 31 March 2020 
                                        (audited) 
 
                                 Revenue   Capital    Total 
 
                                   GBP'000     GBP'000    GBP'000 
                                                               The Total column of 
Net loss on investments at             -   (1,633)  (1,633)    this statement is the 
fair value                                                     profit and loss 
                                                               account of the Fund. 
Income                               137         -      137    All revenue and 
                                                               capital items are 
Investment management fees             -      (52)     (52)    derived from 
                                                               continuing 
Other expenses                     (120)         -    (120)    operations.  No 
                                                               operations were 
Gain/(loss) before finance            17   (1,685)  (1,668)    acquired or 
costs and taxation                                             discontinued in the 
                                                               year.  A Statement of 
Finance costs                       (24)         -     (24)    Comprehensive Income 
                                                               is not required as all 
Loss on ordinary activities          (7)   (1,685)  (1,692)    gains and losses of 
before taxation                                                the Fund have been 
                                                               reflected in the above 
Taxation                               -         -        -    statement. 
 
Loss attributable to ordinary        (7)   (1,685)  (1,692) 
shareholders 
 
Loss per Ordinary Share          (0.12)p  (28.08)p (28.20)p 
 
 
 
 
Balance Sheet 
 
                                                 As at       As at         As at 
                                          30 September    31 March  30 September 
                                                  2020        2020          2019 
                                           (unaudited)   (audited)   (unaudited) 
 
                                                 GBP'000       GBP'000         GBP'000 
 
Fixed Assets 
 
Investments at fair value through profit         6,278       4,463         6,668 
or loss 
 
Total Current Assets                               227         745           138 
 
Creditors:  amounts falling due within           (212)       (299)         (121) 
one year 
 
Net current assets                                  15       (446)            17 
 
Total assets less current liabilities            6,293       4,909         6,685 
 
Capital and Reserves                             6,293       4,909         6,685 
 
Equity shareholders' funds                       6,293       4,909         6,685 
 
Net asset value per Ordinary Share             104.97p      81.88p       111.51p 
 
 
 
Statement of Changes in Equity 
 
 
For the period to 30 September 2020 
 
                      Share     Share  Special     Capital   Capital   Revenue 
                    capital   premium  reserve  redemption   reserve   reserve 
                                                   reserve                          Total 
 
                      GBP'000     GBP'000    GBP'000       GBP'000     GBP'000     GBP'000      GBP'000 
 
As at 1 April 2020      300       314    5,136          27     (492)              (4,909) 
                                                                     (376) 
 
Gain/(Loss)               -         -        -           -     1,442      (58)      1,384 
attributable to 
shareholders 
 
As at 30 September      300       314    5,136          27       950     (434)      6,293 
2020 
 
 
 
 
For the year to 31 March 2020 
 
                      Share     Share  Special     Capital   Capital   Revenue 
                    capital   premium  reserve  redemption   reserve   reserve 
                                                   reserve                          Total 
 
                      GBP'000     GBP'000    GBP'000       GBP'000     GBP'000     GBP'000      GBP'000 
 
As at 1 April 2019      300       314    5,144          27     1,193     (369)      6,609 
 
Ordinary shares 
repurchased               -         -      (8)           -         -         -        (8) 
 
Loss attributable         -         -        -           - 
to shareholders                                              (1,685)       (7)    (1,692) 
 
As at 31 March 2020     300       314    5,136          27     (492)     (376)      4,909 
 
 
For the period to 30 September 2019 
 
                      Share     Share  Special     Capital   Capital   Revenue 
                    capital   premium  reserve  redemption   reserve   reserve 
                                                   reserve                          Total 
 
                      GBP'000     GBP'000    GBP'000       GBP'000     GBP'000     GBP'000      GBP'000 
 
As at 1 April 2019      300       314    5,144          27     1,193     (369)      6,609 
 
Ordinary shares           -         -      (9)           -         -         - 
repurchased                                                                           (9) 
 
Gain attributable         -         -        -           -        47        38         85 
to shareholders 
 
As at 30 September      300       314    5,135          27     1,240     (331)      6,685 
2019 
 
 
 
 
Investment Portfolio as at 30 September 2020 
 
 
                                    Market % of Net     Sector analysis as at  % of Gross 
                             Exposure 2020   Assets     30 September 2020       Exposure 
Stock                                 GBP000 
                                                        Sector 
 
  1 Ocado Group                        343      5.5     Industrials                  20.4 
 
  2 Hilton Food Group                  261      4.1     Consumer Discretionary       19.1 
 
  3 Rentokil Initial                   241      3.8     Technology                   15.3 
 
  4 Unite Group                        231      3.6     Consumer Staples             11.8 
 
  5 Alpha Financial Markets            211      3.4     Financials                    9.6 
 
  6 Knights Group                      208      3.3     Real Estate                   6.5 
 
  7 Dechra Pharmaceuticals             192      3.1     Healthcare                    5.8 
 
  8 Gamma Communications               179      2.8     Consumer Services             4.7 
 
  9 4Imprint Group                     177      2.8     Telecommunications            3.6 
 
 10 FDM Group Holdings                 168      2.7     Energy                        2.4 
 
Ten largest investments              2,211     35.1     Consumer Goods 
                                                                  0.8 
 
11  JD Sports Fashion *                152      2.4     Total                       100.0 
 
 12 Games Workshop Group               148      2.4 
 
 13 Experian                           146      2.3 
 
 14 Renishaw *                         128      2.0 
 
 15 Codemasters                        127      2.0 
 
 16 Learning Technologies              126      2.0 
    Group 
 
 17 Just Eat Takeaway *                123      2.0 
 
 18 Keystone Law Group                 120      1.9 
 
 19 Ceres Power Holdings               117      1.9 
 
 20 Draper Espirit                     116      1.8 
 
Twenty largest investments           3,514     55.8 
 
 21 Flutter Entertainment *            116      1.8 
 
 22 XP Power                           111      1.8 
 
 23 Globaldata                         107      1.7 
 
 24 Johnson Service Group              103      1.6 
 
 25 Computacenter                       98      1.6 
 
 26 Manolete Partners                   98      1.6 
 
 27 Dunelm Group                        98      1.6 
 
 28 Asos *                                      1.5     *Includes Contract for Difference 
                                        97              ("CFD") 
 
 29 Beazley Group                       96      1.5 
                                                        Market exposure for equity 
 30 Team17 Group                        92      1.5     investments held is the same as 
                                                        fair value and for CFDs held is 
Thirty largest investments           4,530     72.0     the market value of the 
                                                        underlying shares to which the 
Other investments (38                2,351     37.4     portfolio is exposed via the 
holdings)                                               contract.  The investment 
                                                        portfolio is grossed up to 
Total investments                    6,881    109.4     include CFDs and the net CFD 
                                                        position is then deducted in 
CFD positions exposure               (750)   (11.9)     arriving at the net asset total. 
 
CFD unrealised gains                   147      2.3 
 
Net current assets                      15      0.2 
 
Net assets                           6,293    100.0 
 
 
Risks and Uncertainties 
 
The principal risks facing the Fund relate to the investment in financial 
instruments and include market, liquidity, credit and interest rate risk. 
 Additional risks faced by the Fund are investment strategy, share price 
discount, accounting, legal and regulatory, operational, corporate governance 
and shareholder relations, and financial.  The Board seeks to mitigate and 
manage these risks through continuous review, policy setting and enforcement of 
contractual obligations.  The Board receives both formal and informal reports 
from the Managers and third party service providers addressing these risks.  An 
explanation of these risks and how they are mitigated is explained in the 2020 
Annual Report, which is available on the Manager's website: 
www.svmonline.co.uk.  These principal risks and uncertainties have not changed 
from those disclosed in the 2020 Annual Report. 
 
Going Concern 
 
The Board, having made appropriate enquiries, has a reasonable expectation that 
the Fund has adequate resources to continue in operational existence for the 
foreseeable future, a period of not less than 12 months from the date of this 
report. Accordingly, it continues to adopt the going concern basis in preparing 
the financial statements. 
 
Notes 
 
1.         The Financial Statements have been prepared on a going concern basis 
in accordance with FRS 102 "Financial Reporting Standard applicable in the UK 
and Republic of Ireland", FRS 104 "Interim Financial Reporting" and under the 
Association of Investment Companies Statement of Recommended Practice 
"Financial Statements of Investment Trust Companies and Venture Capital Trusts" 
("SORP") issued in 2019 (the interim financial statements for the period to 30 
September 2019 were prepared under the SORP issued in 2014).  The requirements 
have been met to qualify for the exemption to prepare a Cash Flow Statement. 
These financial statements have been prepared in accordance with the accounting 
policies used for the financial year ended 31 March 2020. 
 
2.         During the period no shares were bought back (2019 - 10,000 Ordinary 
Shares with a nominal value of GBP500 and representing 0.17% of the issued share 
capital were bought back and placed in treasury for an aggregate consideration 
of GBP8,650). 
 
            The number of shares in issue at 30 September 2020 was 5,995,000 
(2019 - 5,995,000). 
 
            Return per share is based on a weighted average of 5,995,000 (2019 
- 6,004,672) ordinary shares in issue during the period. 
 
Total return per share is based on the total gain for the period of GBP1,384,000 
(2019 - gain of GBP85,000). Capital return per share is based on the capital gain 
for the period of GBP1,442,000 (2019 - gain of GBP47,000). Revenue return per share 
is based on the revenue loss after taxation for the period of GBP58,000 (2019 - 
gain of GBP38,000). 
 
3.         All investments are held at fair value.  At 30 September 2020 no 
unlisted investments were held with value attributed (31 March 2020: same; 30 
September 2019: same). 
 
            Investments have been classified using the fair value hierarchy: 
 
                                                        September    March 
                                                             2020     2020 
                                                             GBP000     GBP000 
 
Classification of financial instruments 
 
Level 1                                                     6,131    4,455 
 
Level 2                                                       147        8 
 
Level 3 - 2 investments (March 2020 - 2)                        -        - 
 
            Level 1 reflects financial instruments quoted in an active market. 
 
            Level 2 reflects financial instruments whose fair value is 
evidenced by comparison with other observable current market transactions in 
the same instrument or based on a valuation technique whose variables include 
only data from observable markets.  The CFD positions are the sole Level 2 
investments at 30 September 2020 and 31 March 2020. 
 
            Level 3 reflects financial instruments whose fair value is 
determined in whole or in part using a valuation technique based on assumptions 
that are not supported by prices from observable market transactions in the 
same instrument and not based on available observable market data. 
 
4.            The Board has granted the Manager a limited authority to invest 
in CFDs to achieve some degree of gearing and/or hedging without incurring the 
gross cost of the investment. The Board requires the Manager to operate within 
certain risk limits, as detailed in the Annual Report. The following table 
details the CFD positions: 
 
Number of CFD holdings at 30 September 2020: 9 (31 March 2020: 9) 
 
CFD positions                                          September     March 
                                                            2020      2020 
 
                                                            GBP000      GBP000 
 
Gross exposure                                               750       514 
 
Net exposure                                                 750       514 
 
Unrealised gains                                             147         8 
 
Unrealised losses                                             92       224 
 
The gearing ratio is 11.4% at 30 September 2020 (31 March 2020: 16.5%).  The 
gearing figure indicates the extra amount by which the shareholders' funds 
would change if total assets (including CFD position exposure and netting off 
cash and cash equivalents) were to rise or fall.  A figure of zero per cent 
means that the Company has a nil geared position. 
 
5.         SVM Asset Management Limited provides investment management and 
secretarial services to the Fund.  The Manager is entitled to a fee for these 
services, payable quarterly in arrears, equivalent to 0.75% per annum of the 
total assets of the Fund, less current liabilities. 
 
6.         The above figures do not constitute full or statutory accounts in 
terms of Sections 434 and 435 of the Companies Act 2006. All information shown 
for the six months to 30 September 2020 is 
 
            unaudited. The accounts for the year to 31 March 2020, on which the 
auditors issued an unqualified report, have been lodged with the Registrar of 
Companies and did not contain a statement required under Section 498 of the 
Companies Act 2006. 
 
For further information, please contact: 
 
Colin McLean                SVM Asset Management            0131 226 6699 
 
Sally Moore                  Four Communications                020 3697 4200 
 
 
 
END 
 

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