Edinburgh Worldwide (EWI) has released interim results for the six months to 30 April 2025. The trust delivered a NAV total return of -2.9%, significantly ahead of the -7.2% fall in its benchmark, the S&P Global Small Cap Index. The share price declined by 1.9% as the discount to NAV narrowed from 7.6% to 6.7%.
Performance was affected by a sharp global market selloff in April, following President Trump’s surprise announcement of sweeping new US tariffs on ‘Liberation Day’, which prompted retaliatory measures from China. Despite this, the trust benefited from strong contributions from private holdings such as SpaceX and PsiQuantum, and from listed US-based Axon Enterprise.
Private company exposure rose to 31.1% of total assets (up from 25.3%), as part of a long-term strategy to identify disruptive growth opportunities early. The trust continues to revalue its private holdings regularly, and reported a 28.6% average uplift in valuation across the private portfolio during the period.
The trust has also been actively reshaped as part of a reset strategy announced in late 2024. The number of portfolio holdings has been reduced from 106 to 78 over the past year, with an increased focus on companies generating cash flow and earnings. Share buybacks have continued, with 6.3m shares repurchased during the period and a further 5.9m bought back since the period end.
The board has paused plans for a tender offer, citing a lack of shareholder support, but remains committed to capital returns through ongoing buybacks. It is also considering a policy to return proceeds from private company realisations to shareholders in future.
New investments include names such as Xometry, Astera Labs, and PROCEPT BioRobotics, while exits have included Adaptimmune and STAAR Surgical. The manager continues to target long-term disruptors in areas such as semiconductors, robotics, quantum computing, and healthcare innovation.
Chair Jonathan Simpson-Dent reiterated confidence in the trust’s distinctive mandate and highlighted the portfolio’s increasing financial resilience, with 33% of companies now generating positive free cash flow.
Despite recent macro uncertainty, the board and manager remain optimistic about the portfolio’s long-term prospects and the trust’s ability to deliver value through innovation-focused global small cap investing.
[QD comment Matthew Read: It’s been a turbulent six months for global small caps, but EWI has come through relatively well, outperforming its benchmark despite macro headwinds. The shift towards higher-quality, cash-generating companies and a more concentrated portfolio appear to be paying off. The revaluation gains from private holdings like SpaceX and PsiQuantum are a reminder of the potential value in the trust’s early-stage investments, though these can cut both ways in volatile markets.
The decision to pause the tender offer might frustrate some, but makes sense if shareholder support is lacking and the ongoing buyback programme has helped narrow the discount, while the board’s willingness to return proceeds from private realisations in future could be a useful lever. Encouragingly, the portfolio’s financial resilience appears to be improving, and the managers remain focused on disruptive growth across tech, healthcare, and industrials, although some patience may be required.]
