HALF-YEARLY FINANCIAL REPORT 2024 - Flipbook - Page 28
26 / OTHER INFORMATION FOR SHAREHOLDERS / THE EDINBURGH INVESTMENT TRUST PLC
GLOSSARY OF TERMS AND ALTERNATIVE PERFORMANCE MEASURES / CONTINUED
GROSS GEARING (APM)
This reflects the amount of gross borrowings in use by a company and takes no account of any cash balances. It is based on
gross borrowings as a percentage of net assets.
Page
Unsecured Senior Loan Notes – debt at fair value
31 March
2024
£’000
73,461
27
a
72,502
72,502
73,461
3
b
1,233,124
1,181,091
c = a/b
5.9%
6.2%
Gross borrowings
Net asset value – debt at fair value
30 September
2024
£’000
Gross gearing
NET GEARING OR NET CASH (APM)
Net gearing reflects the amount of net borrowings invested, i.e. borrowings less cash and cash equivalents (incl. investments in
money market funds). It is based on net borrowings as a percentage of net assets. Net cash reflects the net exposure to cash
and cash equivalents, as a percentage of net assets, after any offset against total borrowings.
30 September
2024
£’000
Page
Unsecured Senior Loan Notes – debt at fair value
Less: cash and cash equivalents
Net asset value – debt at fair value
Net gearing
72,502
73,461
(47,222)
(36,314)
a
25,280
37,147
b
1,233,124
1,181,586
c = a/b
2.1%
3.1%
17
Net borrowings
3
31 March
2024
£’000
LEVERAGE
Leverage, for the purposes of the Alternative Investment Fund Managers Directive (AIFMD), is not synonymous with gearing as
defined above. In addition to borrowings, it encompasses anything that increases the Company’s exposure, including foreign
currency and exposure gained through derivatives. Leverage expresses the Company’s exposure as a ratio of the Company’s
net asset value. Accordingly, if a Company’s exposure was equal to its net assets it would have leverage of 100%. Two methods
of calculating such exposure are set out in the AIFMD, gross and commitment. Under the gross method, exposure represents
the aggregate of all the Company’s exposures other than cash balances held in base currency and without any offsetting.
The commitment method takes into account hedging and other netting arrangements designed to limit risk, offsetting them
against the underlying exposure.
NET ASSET VALUE (NAV)
Also described as shareholders’ funds, the NAV is the aggregate value of all assets less all liabilities. Liabilities for this purpose
include debt, deducted at either par value or fair value as described in more detail below. The NAV per share is calculated by
dividing the net asset value by the number of ordinary shares in issue (excluding shares held in treasury).
NET ASSET VALUE (NAV) – DEBT AT PAR
The NAV with debt at par recognises the value of the debt liability as the nominal amount that will be repaid at maturity. For
the £120m Unsecured Senior Loan Notes, this recognises a liability of £120m. This is the basis used in the preparation of the
Condensed Balance Sheet on page 17.
