Finsbury Growth & Income (FGT) has released annual results for the year to 30 September 2025, marking a centenary year overshadowed by another period of weak performance and material underperformance versus its benchmark. NAV total return was essentially flat at -0.1% (2024: +8.2%), while the share price delivered a total return of 2.3% against a 16.2% gain from the FTSE All-Share Index. Over five years, the trust has returned 2.3% per annum on NAV versus 10.0% from the index, and now ranks towards the bottom of the AIC UK Equity Income sector over one, three and five years.
New chair Pars Purewal acknowledges shareholders’ frustration and says the board has subjected Lindsell Train’s process and portfolio to “close scrutiny” but remains supportive of the high-conviction strategy. The portfolio remains highly concentrated, with just 20 holdings and an active share of 86.4%, and is heavily tilted towards a small group of UK-listed “growth” names such as RELX, Experian, London Stock Exchange, Sage and Diageo. The manager argues that these are “investment diamonds” with long-term compounding potential, and that the portfolio is one of the few in the sector focused on large-cap UK growth businesses.
This year’s AGM will be notable for the trust’s first-ever continuation vote, coinciding with its 100th anniversary. The board is unanimously recommending continuation and says it has received significant support from major shareholders despite the recent record. In a governance move, Lindsell Train co-founders Michael Lindsell and Nick Train will abstain from voting their own combined 4.7% stake to avoid any perception of conflict. If shareholders vote against continuation, the board says it will consider “alternative strategic options”; the vote is not a liquidity event and does not itself trigger tenders or a wind-up.
The board has been active on discount control. Over the year, the trust repurchased 34.7m shares into treasury (20.7% of the share count) at an average discount of 7.5%, adding an estimated 18.2p per share of NAV. Since the year end, a further 10.8m shares have been bought back, reducing the discount from 6.7% at 30 September to 5.7% on 1 December 2025. Shareholders’ funds have fallen to £1.23bn from £1.58bn a year earlier, reflecting both weak returns and the scale of buybacks.
Income remains on a gently rising trend. Total dividends for the year increased by 3.1% to 20.2p (2024: 19.6p) and continue to be paid in the form of two interim payments, a policy the board will again ask shareholders to approve at the AGM. The ongoing charges ratio was broadly flat at 0.62% (2024: 0.61%).
Looking ahead, the board says it “will do whatever it takes to add value for shareholders” and has agreed a fee cut with the AIFM and portfolio manager, effective 1 January 2026, which is expected to save around £600,000 per year. Both directors and the manager have been buying shares, with Train increasing his personal stake to 4.7% of the equity over the year. Despite acknowledging an “extended period of underperformance”, the board and manager argue that the trust’s differentiated portfolio of UK-listed growth and data/brand-rich businesses is well placed to deliver attractive long-term returns if sentiment towards the UK market and the holdings improves.
Matthew Read, senior analyst at QuotedData said: “Finsbury’s latest set of results highlight just how difficult the last few years have been for the trust and its shareholders. A flat NAV total return in a year when the FTSE All-Share was up more than 16% extends an already uncomfortable run of benchmark underperformance and leaves the trust sitting in the bottom quartile of its peer group over most periods. For a vehicle that has long sold itself on patient compounding from a concentrated portfolio of “quality growth” names, the gap versus a more value-tilted UK market – and against a backdrop of higher rates – is difficult to ignore.
“That said, FGT’s board is clearly alive to the problem. It has leaned in hard on buy-backs – more than 20% of the share base was repurchased in the year, adding a meaningful uplift to NAV per share and helping to pull the discount back towards 5% – and has now secured a worthwhile cut in the management fee from the start of 2026. The introduction of a continuation vote in the trust’s centenary year is also a welcome step. We think it is positive that major shareholders have been consulted, and that Lindsell Train is abstaining on its own 4.7% stake to avoid perceived conflicts. Ultimately, however, the decision will come down to whether investors are willing to give the existing strategy more time.
“There is little doubt that FGT has been heavily penalised for avoiding banks, oils and other “value” areas that have led the UK market in recent years. Some might argue that its high active share means periods of sharp divergence from the index, such as this, are inevitable. However, an alternative view is that the concentrated exposure to a relatively small cluster of UK-listed growth and brand/data-rich businesses has amplified stock-specific disappointments, most notably in Diageo and London Stock Exchange Group.
“Bulls will argue that this is precisely the point at which long-duration compounding stories become mispriced and now is the time to be doubling down – the manager’s own buying at these levels shows strong alignment in this regard. On the flip side, more sceptical shareholders may feel they have already been patient enough and will want to see clearer evidence of a turning point before giving the strategy another multi-year pass.”
