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Temple Bar Investment Trust (TMPL), managed by Ian Lance and Nick Purves, returned 33.9% in NAV terms and 45.3% in share price terms over 2025, which was above the returns of the UK and global markets. The shares moved to a premium to asset value at the end of the year, which has been uncommon in the investment company sector recently. This has allowed the fund to begin selling back to the market some of its own shares that it had previously repurchased.
Ian and Nick state that they only deploy capital into companies where they believe there is a clear and viable route to value enhancement for shareholders. The macro backdrop for TMPL appeared positive in 2025, with improving sentiment towards the UK market, where the fund maintains 70% of its exposure. The managers believe that the UK remains undervalued and that they are continuing to identify companies trading below what they consider to be their true worth.
UK equity income and capital growth
TMPL aims to provide growth in income and capital to achieve a long-term total return greater than its benchmark (the FTSE All-Share Index), through investment primarily in UK securities. The company’s policy is to invest in a broad spread of securities, with the majority typically selected from the FTSE 350 Index.
| 12 months ended | Share price total return (%) | NAV total return (%) | MSCI UK total return (%) | MSCI UK Value TR(%) | MSCI World TR (%) |
|---|---|---|---|---|---|
| 31/12/2021 | 20.0 | 23.5 | 19.6 | 17.7 | 22.9 |
| 31/12/2022 | 3.6 | 0.4 | 7.1 | 14.7 | (8.4) |
| 31/12/2023 | 12.5 | 12.3 | 7.7 | 6.4 | 17.3 |
| 31/12/2024 | 19.1 | 19.9 | 9.5 | 12.5 | 21.0 |
| 31/12/2025 | 45.3 | 33.9 | 25.8 | 32.6 | 12.7 |
Source: Bloomberg, Marten & Co
Market overview
2025 was positive for markets, and performance was more broad-based than in previous years.
Investor sentiment during 2025 appeared generally positive, with global equities rallying over the year. Markets appeared less concentrated than in much of the recent past. Although the technology-heavy US market continued to perform strongly, it appears to have dominated investor attention to a lesser extent than in other recent years. This was particularly apparent in the UK, which saw an improvement in both sentiment and performance from previously lower levels.
These trends are illustrated in Figure 1, which shows the performance of various market indices over the year. The S&P 500 rallied, but the UK market – as measured by the MSCI UK Index – performed better. This was not confined to large-cap companies, with smaller UK stocks – illustrated here by the MSCI UK Small Cap Index – also outperforming the US market, albeit narrowly. This overall picture appears to have provided a supportive backdrop for TMPL, where Ian and Nick invest in a broad spectrum of UK companies.
Figure 1: Market performance over 2025, indices rebased to 100
Source: Bloomberg, Marten & Co
The chart shows the year’s main period of market weakness in April, when equities fell following President Trump’s “Liberation Day” tariff announcements. However, the downturn was short-lived, with an initial 90-day tariff pause followed by a series of negotiations between the Trump administration and different countries. For the remainder of the year, investors appeared to focus less on trade developments and more on other factors. Attention shifted to the corporate sector, which was supported in part by a generally stable global inflation and interest rate environment.
Developed market interest rates have continued to fall.
Figure 2 shows the steady fall in interest rates across developed markets in the past two years. Although periods of falling rates can be associated with strong performance for more “growth”-focused investors, in the current relatively benign macro environment both growth and value investors appear to be seeing positive returns. If the market has moved away from the recent period of significant fluctuations between the two styles moving into and out of favour, the risk of this dynamic reasserting itself appears to remain.
Figure 2: US (Federal Reserve), eurozone (ECB) and UK (BoE) benchmark interest rates since January 2024
Source: Bloomberg, Marten & Co
Current prospects for TMPL
Value stocks perform strongly when corporate profitability is strong.
In periods where corporate profitability is generally strong, value stocks in particular have historically tended to perform well. Much of their value is derived from current earnings rather than distant future profits, and strong profitability may boost cash flows and margins. As a result, the current environment appears to be favourable for TMPL’s style of investing.
Ian and Nick state that they believe there remains significant value in their universe of stocks and that current purchases are not being made at the top of the market. The UK market is still materially cheaper than other developed country markets; for example, the S&P 500 started 2026 on a forward price to earnings multiple of 22x versus 13x for the FTSE 100.
With large-cap stocks in the UK outperforming their small-cap peers in 2025, as shown in Figure 1, it may appear logical for Ian and Nick to move down the market-cap spectrum in the coming months. However, they have stated that all investment decisions are made on a stock-specific, bottom-up basis, with a focus on risk and reward, rather than being specifically driven by market-cap considerations.
Portfolio – asset allocation
Financials remain the largest sector weight in TMPL’s portfolio.
Financials remain TMPL’s largest sector weighting, although the allocation has reduced slightly since the previous note (which used data as at 30 April 2025). Four of the portfolio’s top 10 positions are financials companies (see page 6), and the sector appears to have been influenced by corporate profitability, low loan losses and interest margins. Many companies in the sector have conducted share buybacks at what the managers describe as attractive prices. The managers state that there is still value in the sector, even in an environment of falling interest rates, which may put pressure on net interest margins.
TMPL’s allocation to the consumer discretionary sector also decreased, while industrials, consumer staples and technology saw modest increases.
Figure 3: TMPL sector distribution as at 30 April 2025
Figure 4: TMPL sector distribution as at 30 November 2025
Source: Temple Bar Investment Trust
Source: Temple Bar Investment Trust
In terms of geography, the trust’s policy is to invest the majority of the portfolio in companies in the UK’s FTSE 350 index, with a limit on non-UK assets of 30%. The current UK allocation is 70.3% (as at 30 November 2025). There are also overseas holdings in the portfolio, including the US retailer Macy’s and the Korean banks Hana Financial and Woori.
Early in 2025, Ian and Nick sold the Dutch bank ABN AMRO (another non-UK holding), with TMPL having approximately doubled its money from the original investment. The proceeds were kept within the financial sector through the purchase of Hana Financial and Woori. Sentiment towards the Korean banking sector has been depressed and both banks traded on low valuations. The managers identified that both banks are experiencing steady loan growth in an expanding economy, and stated that they are efficiently run and have strong capital ratios. The Korean market rallied from the middle of May onwards, following efforts to improve Korean corporate governance, which may have benefited TMPL’s Korean exposure.
Gearing
TMPL’s gearing was 3.0% as at 30 November 2025, down from 5.7% at the time of our last note in May 2025.
Top 10 holdings and recent additions
Figure 5: Top 10 holdings as at 30 November 2025
| Holding | Sector | % of portfolio 30/11/25 | % of portfolio 30/04/25 | Change(%) |
|---|---|---|---|---|
| Johnson Matthey | Materials | 5.1 | 3.5 | 1.6 |
| Shell | Energy | 4.7 | 5.0 | (0.3) |
| NatWest | Financials | 4.3 | 5.0 | (0.7) |
| BP | Energy | 4.2 | 4.0 | 0.2 |
| BT Group | Communications | 4.0 | 3.4 | 0.6 |
| ITV | Communications | 4.0 | 4.7 | (0.7) |
| NN | Financials | 3.9 | 4.8 | (0.9) |
| Aviva | Financials | 3.8 | 4.9 | (1.1) |
| Barclays | Financials | 3.5 | 4.6 | (1.1) |
| Smith & Nephew | Healthcare | 3.5 | 2.1 | 1.4 |
| Total of top 10 | 41.0 | 42.0 | (1.0) |
Source: Temple Bar Investment Trust, Bloomberg
Johnson Matthey has moved from the 10th-largest holding to first, due to significant share price performance in recent months. There are two new names in the top 10, with BT Group and Smith & Nephew replacing Marks & Spencer and Standard Chartered.
BT Group and Smith & Nephew are covered below. The managers were also asked about progress at ITV.
Smith & Nephew
Figure 6: Smith & Nephew (GBp)
Source: Bloomberg
Smith & Nephew (www.smith-nephew.com) is a UK-based global medical technology company specialising in orthopaedics, sports medicine, ear, nose and throat (ENT) devices and advanced wound management. Ian and Nick initiated a position in Q2 of 2025.
The company has underperformed in recent years, and the TMPL managers were able to purchase the shares at about half their earlier high of around £20. The company is implementing a 12-point plan, which management states is aimed at improving operational performance, simplifying the business, and supporting sustainable growth. Management reports that this has led to a return to consistent underlying revenue growth across divisions, and believes that as margins improve, the shares may perform well.
The company reported steady progress through 2025, with organic revenue growth of around 5%, which management attributes to strong demand in sports medicine and advanced wound management products, while cash generation has strengthened. The company also completed a US$500m share buyback programme to return capital to shareholders.
BT Group
Figure 7: BT Group (GBp)
Source: Bloomberg
BT Group (www.bt.com) is the UK’s largest telecoms provider. TMPL’s investment is primarily focused on Openreach, the division responsible for building and maintaining the physical broadband and telephone network across the UK. The managers state that when homes are connected to this infrastructure, BT requires approximately three out of ten to sign up as customers to ensure profitability, and they report that this is currently being achieved. In contrast, the alternative networks (“altnets”) such as CityFibre, Toob, and Zzoomm are not achieving this level of customer uptake and may risk running out of funding.
BT’s shares have increased from just over 100p in May 2024, as the market appears to have become more comfortable with the Openreach business. According to Ian and Nick, the price remains too low. Outside of Openreach, the company is undergoing a strategic transformation under chief executive Allison Kirkby, with a focus on modernisation, simplification, and customer service. The business is being streamlined, for example by exiting sports broadcasting, which management states was disappointing, and is seeking to strengthen its position in both consumer and enterprise markets. The company has reported modest growth in core earnings despite a slight fall in revenue.
ITV
Figure 8: ITV (GBp)
Source: Bloomberg
ITV (www.itvplc.com) is the UK’s largest commercial broadcaster and a vertically integrated media group. Its two principal operating segments are ITV Studios, a global production and distribution business, and Media & Entertainment (M&E), which encompasses broadcasting and the streaming service ITVX.
ITV Studios is the second-largest independent production company in the world. Ian and Nick estimate it would be worth more than £3bn if auctioned separately. With the ITV share price remaining relatively static over the last year, this £3bn figure is approximately equal to the company’s overall market cap, which suggests that investors may be attributing limited value to the M&E segment. Broadcasting appears to be facing challenges, with fewer people watching linear television and high fixed costs. ITVX is growing both subscriber numbers and digital advertising.
Recently there have been press reports of preliminary talks between Comcast – the owner of Sky – and ITV regarding a potential purchase of the M&E division by Comcast. There is no guarantee these talks will lead to a deal. The reports appeared to boost the shares at the end of the year, and suggest that an event to unlock value for shareholders from M&E may occur.
Performance
The current Redwheel management team has been running TMPL since the end of October 2020, so the five-year period in Figure 9 is entirely covered by their tenure. Over this period, the NAV return of 124% has been ahead of both the benchmark MSCI UK index and the narrower MSCI UK Value sector.
Figure 9: Temple Bar NAV relative to MSCI UK and MSCI UK Value (sterling TR) to 31 December 2025
Source: Bloomberg, Marten & Co
Figure 10 shows that TMPL’s share price return over five years was 142%, which is higher than the returns of the two MSCI indices. Most of this outperformance appears to have occurred in more recent years, during a period when falling inflation and interest rates may have been favourable for both UK and value investors.
TMPL’s short-term performance shows a one-year share price return that appears notable, with discount narrowing continuing (see page 12). The NAV return of 33.9% is also ahead of both the relevant indices, which may be attributable to stock selection.
Figure 10: Total return performance over periods ending 31 December 2025
| 3 months(%) | 6 months(%) | 1 year(%) | 3 years(%) | 5 years(%) | |
|---|---|---|---|---|---|
| TMPL share price | 7.1 | 21.2 | 45.3 | 94.7 | 142.1 |
| TMPL NAV | 6.6 | 17.2 | 33.9 | 80.3 | 123.5 |
| MSCI UK | 7.1 | 15.4 | 25.8 | 48.3 | 90.0 |
| MSCI UK Value | 9.5 | 20.8 | 32.6 | 58.7 | 114.2 |
Source: Bloomberg, Marten & Co.
Contributor
Johnson Matthey
Figure 11: Johnson Matthey (GBp)
Source: Bloomberg
Johnson Matthey (www.matthey.com) is a speciality chemicals and sustainable technologies company that operates globally across clean air, platinum group metals, and catalyst and hydrogen technologies.
On a five-year view the shares had underperformed. This enabled Ian and Nick to purchase stock at a discount to their assessment of the worth of the whole company. They hoped that value could be released in a relatively short period, as there has been agitation from an activist shareholder, the US hedge fund firm Standard Investments, which holds 11% of the company. This appears to have led to proactive measures from the Johnson Matthey board, which may partly explain the share price performance in 2025.
In May, Johnson Matthey agreed to sell its Catalyst Technologies business to Honeywell International; the deal is expected to complete in the first half of 2026. This is an all-cash deal valued at around £1.8bn, versus a market cap value of Johnson Matthey at the time of the announcement of around £2.3bn. Although the shares rallied on the news of the deal, Catalyst Technologies generates around 25% of the profits of the group. The managers believe that the remainder of the company is still undervalued.
Detractor
WPP
Figure 12: WPP (GBp)
Source: Bloomberg
WPP (www.wpp.com) is a communications and advertising group that operates through a global network of agency brands across media, creative, public relations, and technology services. The company’s scale and breadth provide a diversified client base and exposure to various advertising formats, including traditional channels as well as digital and data-driven segments.
WPP shares declined by around two-thirds in 2025. WPP has issued two profit warnings in recent months, and guided 2025 revenue down by 5-6% and earnings down 25%. There are a number of factors that may be affecting the industry, including a weak advertising cycle. Management has also stated that the business has faced operational challenges. Other companies in the sector do not appear to be performing as poorly. A new CEO, Cindy Rose, recently joined from Microsoft, and reports that she has identified a number of areas where improvements may be made.
The result is that the shares appear to be lowly rated and, in Ian and Nick’s view, the new management only needs to steady the ship and begin making basic improvements for them to begin to recover. The managers state that they are confident this can happen in the coming months.
Peer group
You can find up-to-date information on TMPL and its peers on our website
Discounts have continued to narrow across the sector in recent months, and three trusts in the sector stand on premiums at the time of writing (see Figure 13). TMPL’s premium is currently the widest in the sector. The ongoing charges ratio of 0.61% is below the peer group median of 0.82%.
Figure 13: Snapshot of UK equity income sector as at 6 January 2026
| Premium/(discount) (%) | Yield(%) | Ongoing charges(%) | Market cap(£m) | |
|---|---|---|---|---|
| Temple Bar Investment Trust | 1.81 | 3.9 | 0.61 | 1,124 |
| Aberdeen Equity Income Trust | 0.76 | 5.6 | 0.84 | 200 |
| BlackRock Income and Growth | (13.67) | 3.5 | 1.15 | 42 |
| Chelverton UK Dividend Trust | (2.77) | 7.1 | 2.79 | 31 |
| CT UK Capital and Income | (3.54) | 3.8 | 0.66 | 329 |
| Diverse Income Trust | (7.56) | 4.2 | 1.13 | 256 |
| Dunedin Income Growth | (7.13) | 6.2 | 0.56 | 372 |
| Edinburgh Investment Trust | (6.48) | 3.5 | 0.51 | 1,126 |
| Finsbury Growth & Income | (5.46) | 2.4 | 0.62 | 977 |
| JPMorgan Claverhouse | (4.36) | 4.1 | 0.63 | 483 |
| Law Debenture Corporation | (1.56) | 3.1 | 0.51 | 1,457 |
| Lowland Investment Company | (8.37) | 4.0 | 0.71 | 362 |
| Murray Income Trust | (8.51) | 4.3 | 0.50 | 885 |
| Schroder Income Growth Fund | (5.38) | 4.2 | 0.78 | 240 |
| Shires Income | (0.29) | 5.0 | 1.00 | 123 |
| The City of London Investment | 1.38 | 4.0 | 0.36 | 2,713 |
| The Merchants Trust | (5.79) | 4.8 | 0.52 | 895 |
| Peer group median | (4.5) | 4.3 | 0.82 | 683 |
| TMPL rank | 1/17 | 12/17 | 7/17 | 4/17 |
Source: Marten & Co.
The yield continues to be towards the bottom of the peer group. However, this has increased from 3.5% at the time of the last note to 3.9% now. This appears to have been boosted by the new dividend policy that is explained on page 11. TMPL is the fourth-largest fund in the sector.
Figure 14 illustrates TMPL’s performance record against its peers, showing that it was the sector leader over six months, one year, three years and five years.
Figure 14: Total return NAV performance over periods ending 31 December 2025
| 3 months(%) | 6 months(%) | 1 year(%) | 3 years(%) | 5 years(%) | |
|---|---|---|---|---|---|
| Temple Bar Investment Trust | 6.6 | 17.2 | 33.9 | 80.3 | 123.5 |
| Aberdeen Equity Income Trust | 7.5 | 16.8 | 30.8 | 39.7 | 62.5 |
| BlackRock Income and Growth | 6.0 | 10.1 | 16.2 | 36.7 | 56.7 |
| Chelverton UK Dividend Trust | (1.4) | (1.2) | 1.1 | 6.9 | 21.1 |
| CT UK Capital and Income | 2.3 | 5.2 | 13.2 | 33.5 | 45.1 |
| Diverse Income Trust | 1.8 | 8.4 | 23.5 | 38.4 | 38.8 |
| Dunedin Income Growth | 5.6 | 3.1 | 14.8 | 27.8 | 33.3 |
| Edinburgh Investment Trust | 2.3 | 3.9 | 10.0 | 42.9 | 78.8 |
| Finsbury Growth & Income | (4.6) | (10.2) | (7.6) | 5.3 | 11.2 |
| JPMorgan Claverhouse | 6.5 | 12.4 | 27.6 | 49.3 | 74.9 |
| Law Debenture Corporation | 4.8 | 12.1 | 27.8 | 61.3 | 96.0 |
| Lowland Investment Company | 6.2 | 13.1 | 31.5 | 54.7 | 80.7 |
| Murray Income Trust | 6.7 | 7.8 | 14.7 | 26.9 | 42.5 |
| Schroder Income Growth Fund | 7.2 | 11.6 | 25.1 | 41.3 | 63.8 |
| Shires Income | 8.2 | 11.0 | 26.0 | 42.4 | 59.2 |
| The City of London Investment | 6.7 | 11.9 | 27.2 | 51.0 | 90.5 |
| The Merchants Trust | 6.5 | 9.7 | 18.2 | 33.6 | 85.9 |
| Peer group median | (3.7) | (1.2) | 2.4 | 13.0 | 31.8 |
| TMPL rank | 6/17 | 1/17 | 1/17 | 1/17 | 1/17 |
Source: Bloomberg, Marten & Co
Dividend
Shareholders receive a dividend payment each quarter.
The board has reiterated its intention to distribute, over time, substantially all of TMPL’s net revenue income, and accordingly makes a dividend payment to shareholders each quarter. The first three payments for the financial year 2025 were each for 3.75p. This represents an increase over the previous year, with these three payments equalling the total of the four payments in 2024, with a final dividend still to be declared.
This increase in pay-out appears to be related to the recent change to TMPL’s dividend policy, as detailed in the previous note. Companies are increasingly making returns to their investors through share buybacks rather than, or in addition to, income payments; this may be the case with many of the companies held by TMPL given their low valuations. The board states that it wishes for TMPL shareholders to benefit from this trend and is enhancing the dividends being paid to reflect a portion of these buybacks by using TMPL’s distributable reserves. Dividends for 2025 each reflected this enhancement, of 0.75p each time. The board has stated that it hopes to increase this amount further over the next year.
Figure 15: TMPL’s recent dividend record as of 31 December 2025
Source: Temple Bar Investment Trust
Premium/(discount)
Figure 16: TMPL discount over five years ended 31 December 2025
Source: Bloomberg, Marten & Co
In our last note we commented on the apparent narrowing trend of the discount at the beginning of 2025. As shown in Figure 16, this trend has continued and the shares have traded on a consistent premium since the end of September.
TMPL’s shares moved to a premium at the end of 2025.
TMPL’s shares moving to a premium appears to reflect both the trust’s ongoing performance and the wider environment, with the UK market having a positive year. If these factors continue, the trust may continue to trade at or above par through 2026.
When the shares traded on a discount, the board repurchased shares. A total of 5.218m shares were repurchased in 2024 at a cost of £12.7m. The final such purchase was made in February 2025. With the recent move to a premium, the board has sold some of the shares held in treasury. 1.775m shares were sold in October, 1.15m in November, and 2.12m in December. The sales increased the trust’s liquidity and the NAV per share for existing shareholders.
As this extra capital comes into the fund, Ian and Nick report deploying it quickly; they state that they have not encountered a shortage of new investment ideas.
Fund profile
You can access the trust’s website at: templebarinvestments.co.uk
TMPL aims to provide growth in income and capital to achieve a long-term total return greater than its benchmark (the FTSE All-Share Index), through investment primarily in UK securities. The company’s policy is to invest in a broad spread of securities with typically the majority of the portfolio selected from the constituents of the FTSE 350 Index.
Co-managers Nick Purves and Ian Lance aim to rotate the portfolio into companies that they believe are available at a significant discount to intrinsic value. According to the managers, this involves buying the shares of companies they consider attractively valued and out-of-favour, and holding them for the long term until, in their view, the share prices more appropriately reflect their assessment of true value, or until they identify what they consider to be more attractive opportunities.
Redwheel became manager of TMPL on 1 November 2020
Redwheel took on responsibility for the portfolio with effect from 1 November 2020, with Nick and Ian named as co-managers. They have a combined experience of over 50 years and have worked together for more than 15 years. The two co-manage over £3bn of assets across a number of income funds. TMPL’s AIFM is Frostrow Capital.
Previous publications
Readers interested in further information about TMPL may wish to read our previous note, Temple of performance, published on 29 May 2025, as well as our previous notes. You can read the notes by clicking on them in Figure 19 or by visiting our website.
Figure 19: QuotedData’s previously published notes on TMPL
| Title | Note type | Date |
|---|---|---|
| Keeping faith | Initiation | 23 September 2020 |
| Just getting started | Update | 23 April 2021 |
| No compromise | Annual overview | 8 December 2021 |
| Time to Shine | Annual overview | 31 August 2022 |
| True Colours | Update | 26 June 2023 |
| Foundations for success | Update | 27 March 2024 |
| Historic opportunity | Annual overview | 22 October 2024 |
| Temple of performance | Update | 29 May 2025 |
Source: Marten & Co
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