jpmorgan mid cap investment trust plc...the company currently conducts its affairs so that the...

JPMorgan Mid Cap Investment Trust plc Half Year Report & Financial Statements for the six months ended 31st December 2018

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K E Y F E A T U R E S

J P M O R G A N M I D C A P I N V E S T M E N T T R U S T P L C . H A L F Y E A R R E P O R T & F I N A N C I A L S T A T E M E N T S 2 0 1 8

Your Company

ObjectiveJPMorgan Mid Cap Investment Trust plc (the ‘Company’) aims to achieve capital growth from investment in medium-sized UK listedcompanies. The Company specialises in investment in FTSE 250 companies, using long and short term borrowings to increase returns toshareholders.

Investment Policies• To focus on FTSE 250 stocks that deliver strong capital growth.

• To have significant exposure to the UK economy, with selective exposure to overseas earnings.

• To seek out both value stocks and growth stocks, including AIM stocks, to deliver strong performance throughout the market cycle.

• To use gearing to increase potential returns to shareholders.

• To invest no more than 15% of gross assets in other UK listed investment companies (including investment trusts).

The Company’s shares are designed for private investors in the UK, including retail investors, professionally-advised private clients andinstitutional investors, who seek the potential for capital growth from investment in the UK market and who understand and are willingto accept the risks of exposure to equities. Private investors may wish to consider consulting an independent financial adviser whospecialises in advising on the acquisition of shares and other securities before acquiring shares in the Company. Investors should becapable of evaluating the risks and merits of such an investment and should have sufficient resources to bear any loss that may result.

BenchmarkThe FTSE 250 Index (excluding investment trusts).

Capital Structure• UK domiciled.

• Premium listing on the London Stock Exchange.

• As at 31st December 2018, the Company’s issued share capital comprised 23,762,680 ordinary shares of 25p each including1,635,400 shares held in Treasury.

Management CompanyThe Company employs JPMorgan Funds Limited (‘JPMF’ or the ‘Manager’) as its Alternative Investment Fund Manager. JPMF delegatesthe management of the Company’s portfolio to JPMorgan Asset Management (‘JPMAM’). JPMAM is regulated by the Financial ConductAuthority.

FCA regulation of ‘non-mainstream pooled investments’ and ‘complex instruments’The Company currently conducts its affairs so that the shares issued by JPMorgan Mid Cap Investment Trust plc can be recommendedby Independent Financial Advisers to ordinary retail investors in accordance with the FCA’s rules in relation to non-mainstreaminvestment products and intends to continue to do so for the foreseeable future.

The shares are excluded from the FCA’s restrictions which apply to non-mainstream investment products because they are shares in aninvestment trust. The Company’s ordinary shares are not considered to be ‘complex instruments’ under the FCA’s ‘Appropriateness’rules and guidance in the Conduct of Business sourcebook.

AIC The Company is a member of the Association of Investment Companies.

WebsiteThe Company’s website, which can be found at www.jpmmidcap.co.uk, includes useful information on the Company, such as dailyprices, factsheets and current and historic half year and annual reports.

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C O N T E N T S

C O N T E N T S

Half Year Performance 3 Financial Highlights

Chairman’s Statement 6 Chairman’s Statement

Investment Review 9 Investment Managers’ Report

11 List of Investments

12 Portfolio Analysis

Financial Statements 14 Statement of Comprehensive Income

15 Statement of Changes in Equity

16 Statement of Financial Position

17 Statement of Cash Flows

18 Notes to the Financial Statements

Interim Management 22 Report

Shareholder Information 24 Glossary of Terms and Alternative

Performance Measures (‘APMs’)

26 Where to buy J.P. Morgan Investment Trusts

29 Information about the Company

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Half Year Performance


F I N A N C I A L H I G H L I G H T S

H A L F Y E A R P E R F O R M A N C E | 3

1 Source: Morningstar.2 Source: Morningstar/J.P.Morgan, using net asset value per share, cum income.3 Source: Morningstar. The Company’s benchmark is the FTSE 250 Index (excluding investment trusts).

A glossary of terms and alternative performance measures is provided on pages 24 and 25.

TOTAL RETURNS (INCLUDING DIVIDENDS REINVESTED) TO 31ST DECEMBER 2018

3 Year 5 Year 10 Year 6 Months Cumulative Cumulative Cumulative

Return to shareholders1

Return on net assets2

Benchmark return3

Net asset returnperformance againstbenchmark return3

–20.6% –3.8% +41.3% +377.3%

–20.8% +1.8% +37.4% +315.4%

–16.8% +5.4% +21.4% +271.1%

–4.0% –3.6% +16.0% +44.3%


F I N A N C I A L H I G H L I G H T S

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SUMMARY OF RESULTS

1 This return excludes dividends reinvested. Including dividends reinvested the return would be –20.8%.2 This return excludes dividends reinvested. Including dividends reinvested the return would be –20.6%.

A glossary of terms and alternative performance measures is provided on pages 24 and 25.

31st December 30th June % 2018 2018 change

Shareholders’ funds (£’000) 243,980 314,130 –22.3

Number of shares in issue (excluding shares held in Treasury) 23,762,680 23,812,680 —

Net asset value per share 1,026.7p 1,319.2p –22.21

Share price 974.0p 1,250.0p –22.12

Share price discount to net asset value per share 5.1% 5.2%

Gearing 1.1% 4.6%

Ongoing Charges Ratio 0.85% 0.83%


Chairman’s Statement

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C H A I R M A N ’ S S T A T E M E N T


Performance

The UK stock market suffered its worst year in a decade in 2018, as concerns over global growth increasedsharply, and Brexit related risks intensified. The second half of the year, in particular, saw considerablestock market volatility and a marked deterioration in investor sentiment towards the UK, leading to a majormarket sell-off. As a consequence, in the six month period under review to 31st December 2018, theCompany’s total return on net assets was –20.8%, representing an underperformance of the Company’sbenchmark, which returned –16.8%. The discount level remained almost unchanged over the half year,although this masks intra-period volatility, particularly around the market correction in October. Thisresulted in a share price total return of –20.6%. Whilst it is disappointing to report an underperformance,the Board focusses on longer term performance, which remains strong. Shareholders will be pleased tonote that the share price rebounded in January 2019, returning just under 10%.

A review of the Company’s performance for the period and the outlook for the remainder of the year isprovided in the Investment Managers’ Report.

Revenue and Dividends

Net revenue after taxation for the six months to 31st December 2018 was £3.45 million (2017: £3.45 million)and earnings per share, calculated on the weighted average number of shares in issue, were 14.50p(2017: 14.47p). The Board has declared an interim dividend of 8.0p (2017: 8.0p) to be paid on 17th April2019 to shareholders on the register at the close of business on 15th March 2019.

Loan Facilities and Gearing

The Board has determined that in normal circumstances the Company’s overall gearing range is 5% netcash to 25% geared. Within this range, after due consideration at each Board meeting, the Board normallysets a narrower, short term gearing range for the ensuing period. In the run-up to the scheduledwithdrawal of the UK from the European Union, the Investment Managers have reduced the gearing level to1.1%. More information on the Company’s portfolio positioning ahead of the withdrawal is detailed withinthe Investment Managers’ Report.

The Company is in the process of refinancing its multi-currency loan facility with Scotiabank. The refinanced£30 million five year facility will have an option of further increasing the amount available to £50 million.

Management of the Discount

The Board believes that the repurchase authority remains an important tool in the management of discountvolatility and powers were again sought and approved by shareholders at the Company’s 2018 AnnualGeneral Meeting. The Company will only repurchase shares at a discount to their prevailing net asset value.The Company repurchased 50,000 shares over the reporting period when the discount significantlywidened over a particularly volatile period.

Board of Directors

Ahead of the retirement of Margaret Littlejohns at the conclusion of the Company’s 2019 Annual GeneralMeeting, Margaret Payn has been appointed to the Board with effect from 1st March 2019. Margaret hasextensive experience across the financial sector, most recently at AMP where she was CFO/COO. Afterqualifying as an accountant with KPMG, she worked for several organisations including nine years atSchroders (latterly as CFO/COO of the Asian business based in Hong Kong) and three years at ANZ insimilar roles.

Michael HughesChairman


C H A I R M A N ’ S S T A T E M E N T

C H A I R M A N ’ S S T A T E M E N T | 7

Prospects

The increased stock market volatility experienced in the second half of 2018 has been attributed to theexpectations of tightening credit conditions and greater political and trade tensions. The net result wasto see reduced forecasts for economic and profits growth for this year and possibly next. It is thereforereassuring to see Central Banks rein in their expectations of policy tightening. However, at the time ofwriting there is no confirmation of any softening in the US position on trade tariffs and a final Brexit dealis still awaited. While these global uncertainties have led to a more cautious stance by companies, it isworth noting that the holdings of cash by UK companies is now approaching the equivalent of 40% ofGDP.1 This has steadily increased since the financial crisis of 2008 and accelerated sharply since thereferendum result. There is therefore the scope for a boost to the economy when business confidencereturns and companies are ready to re-establish their investment plans. It is also a timely reminder thatmost UK companies remain in good health.

It is also worth noting that increased stock market volatility did not lead to a reduction in M&A activityin the FTSE 250 universe. This is a feature we have identified before as being one of the attractions ofthis sector.

The ability of our investment team to identify likely out-performers and to react swiftly in cutting ourexposures to under-performers has been proven over many years. We therefore remain confident that theirability to outperform their benchmark will be re-established after the underperformance in the periodunder review. This, together with the potential for the FTSE 250 to be re-rated once confidence hasreturned, leads us to believe that your Company will provide attractive total returns to both existing andnew investors over the longer term.

1 Pantheon Macroeconomics.

Michael HughesChairman 25th February 2019


Investment Review

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I N V E S T M E N T M A N A G E R S ’ R E P O R T

I N V E S T M E N T R E V I E W | 9

Georgina BrittainInvestment Manager

Katen PatelInvestment Manager

Performance and Market Background

UK economic growth remained positive in 2018, but pedestrian at 1.4%. On a more optimistic noteunemployment continued to fall, reaching 4% in December 2018, and inflation also declined to its lowestlevel in almost two years, ending 2018 at 2.1%. However, the second half of the year saw a notable rise instock market volatility and a sharp deterioration in investor sentiment. This led to significant declines instock markets around the world. In the UK the FTSE 100 Index fell 10.2% but the FTSE 250 (ex-InvestmentTrusts) Index fell more and was down 16.8% in the six months to December 2018. 2019 has started witha positive tone, with almost half the losses recovered in January alone.

The global economic backdrop is mixed. Global growth was 3.7% in 2018, with forecasts now indicatinga slowdown to 3.5% for 2019. The slowdown in Chinese GDP and the on-going trade dispute between Chinaand the US, allied with a number of interest rates rises in the US during 2018, have been the key causes.It is important to emphasise that the level of growth still remains healthy.

Against this sharp decline in the index, it is disappointing to report that your Company underperformed itsbenchmark during the period, with a total return on net assets of –20.8%. The discount remained largelystatic, providing a share price return of –20.6%

Portfolio

While a number of positions in the portfolio performed well, such as our holdings in Marshalls, John Laing,Plus 500 and a recent IPO, Avast, we underperformed in the period under review for three key reasons.Firstly, while gearing had been reduced and ended the year at 1.1%, it was clearly negative in the fallingmarket. Secondly, there were a number of takeovers in the FTSE 250 Index, including BTG, JLT and NEX,none of which we owned. These impacted on our performance relative to the Index. The third reason wasdue to underperformance by three of our large holdings. Ashtead and Electrocomponents both sufferedsignificant share price declines, despite producing only positive news flow. The former was on misplacedfears of a US recession, the latter on concerns around global industrial capital spending. The third, andmost disappointing company was Sophos (an IT security company), which suffered very poor trading, andthat position has been significantly reduced.

We made several changes to the portfolio in the half year. New additions include the pub group EI, thecinema chain Cineworld, and Telecom Plus, a UK multi-utility supplier. We exited a number of holdingsincluding Card Factory, Weir, UDG, IMI and BBA. There were also some notable changes to sectorpositioning. Software, Industrial Engineering and General Retailers were all reduced, while the weights inthe Financial Services and Travel & Leisure sectors were significantly increased.

Outlook

At the time of writing, the day we are due to leave the EU is only just over one month away. At this stage innegotiations, the outcome remains very uncertain. As we have indicated before, our stance had been toplan, and to position the portfolio, for a ‘hard Brexit’. As can be seen from some of the recent portfoliochanges outlined above, we have softened this approach over recent months and increased our domesticexposure. In part, this action has been taken due to the decline in valuation of a number of domesticcompanies, but in addition recent data has shown a significant improvement in the financial position of theBritish worker. This was demonstrated by the Asda Income Tracker, which showed that disposable incomehad risen by +5.8% year on year in December 2018. Lower inflation, very low unemployment and thissignificant rise in real wages should in normal times be extremely positive for consumer-facing stocks.However, a recent collapse in consumer confidence, due to Brexit uncertainties, has cast a pall. There isa clear disconnect between these two data points. If the Government is able to negotiate its way out of thecurrent impasse, we should see sterling rise, inflation fall further and consumer confidence reboundstrongly, which would be very positive for the share prices of domestic-facing companies.


I N V E S T M E N T M A N A G E R S ’ R E P O R T


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Further contradictions abound at present. The UK has just been rated by Forbes as the most businessfriendly of the world’s biggest economies, but according to the Bank of England UK investment intentionshave collapsed in recent months. Overall the UK remains out of favour, as evidenced by the valuation of theUK market, and the FTSE 250 in particular, and by a recent BAML fund managers’ survey which showed thata net 38% of global investors are underweight the UK. If, and it is a big if, the UK can exit the EU gracefully,then the UK market will enjoy significant buying interest, and in particular the more domestically focussedFTSE 250 will reap the benefit.

Georgina BrittainKaten PatelInvestment Managers 25th February 2019


L I S T O F I N V E S T M E N T S

I N V E S T M E N T R E V I E W | 1 1

ValuationCompany £’000



FINANCIALSIntermediate Capital 10,642

Plus500 9,548

OneSavings Bank 8,206

Charter Court Financial Services 5,725

Beazley 4,783

John Laing 4,234

Amigo 4,225

Phoenix 4,046

Close Brothers 3,773

Workspace 3,682

Man 3,571

Bank of Georgia 3,443

Shaftesbury 3,235

CLS 2,659

Tritax Big Box 2,449

TBC Bank 2,432

IntegraFin 1,949

Savills 1,764

Jupiter Fund Management 1,520

81,886

INDUSTRIALSAshtead1 10,641

Electrocomponents 10,233

Marshalls 5,578

Vesuvius 4,128

Howden Joinery 3,637

Hill & Smith 3,525

RPC 3,452

Rotork 3,343

Renishaw 3,259

Babcock International 3,229

Grafton 2,990

Hays 2,912

Rhi Magnesita 2,375

Bodycote 2,318

Spirax-Sarco Engineering1 2,179

Morgan Advanced Materials 1,921

Keywords Studios2 1,119

66,839

CONSUMER SERVICESSSP 7,251

JD Sports Fashion 6,836

Auto Trader1 5,222

Wizz Air 5,100

EI 4,540

Cineworld 4,238

National Express 3,716

Ascential 3,052

Moneysupermarket.com 2,342

888 1,575

B&M European Value Retail 1,520

45,392

CONSUMER GOODSGames Workshop 7,284

Bellway 6,715

Victoria2 2,275

Fevertree Drinks2 1,689

17,963

TECHNOLOGYFDM 4,087

Avast 2,975

Sophos 2,256

Softcat 2,205

Computacenter 1,915

13,438

HEALTH CAREHikma Pharmaceuticals1 3,766

Dechra Pharmaceuticals 2,999

NMC Health1 1,915

8,680

OIL & GASPetrofac 2,671

Hunting 2,587

Premier Oil 1,329

6,587

BASIC MATERIALSKAZ Minerals 2,231

Ferrexpo 1,574

3,805

TELECOMMUNICATIONSTelecom Plus 2,148

2,148

TOTAL INVESTMENTS 246,7381 FTSE 100 Index companies.2 AIM listed companies.

LIST OF INVESTMENTS

AS AT 31ST DECEMBER 2018


P O R T F O L I O A N A L Y S E S


INVESTMENT ACTIVITY

31st December 2018 30th June 2018 %1 %1

FTSE 250 Index companies2,3 88.3 86.3

FTSE 100 Index companies2 9.6 8.1

AIM listed companies 2.1 1.3

Other investments3 — 4.3

Total 100.0 100.0

¹ Based on total investments of £246.7m (30th June 2018: £328.6m).2 Spirax-Sarco Engineering and Auto Trader have been reclassified to the FTSE 100 Index as at 31st December 2018. They were previously classified within the FTSE 250 Index.3 Plus500, Avast and Amigo have been reclassified to the FTSE 250 Index as at 31st December 2018. They were previously classified within Other investments.

SECTOR

31st December 2018 30th June 2018 Portfolio Benchmark Portfolio Benchmark %1 % %1 %

Financials 33.2 28.6 27.9 28.3

Industrials 27.1 28.4 34.4 28.9

Consumer Services 18.4 17.3 18.1 16.9

Consumer Goods 7.3 8.6 5.3 7.2

Technology 5.4 2.7 6.4 2.4

Health Care 3.5 4.7 4.3 5.8

Oil & Gas 2.7 2.4 2.0 3.9

Basic Materials 1.5 4.2 1.6 3.9

Telecommunications 0.9 1.3 — 1.2

Utilities — 1.8 — 1.5

Total 100.0 100.0 100.0 100.0

1 Based on total investments of £246.7m (30th June 2018: £328.6m).


Financial Statements


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FOR THE SIX MONTHS ENDED 31ST DECEMBER 2018

(Unaudited) (Unaudited) (Audited)Six months ended Six months ended Year ended31st December 2018 31st December 2017 30th June 2018

Revenue Capital Total Revenue Capital Total Revenue Capital Total£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000

(Losses)/gains on investmentsheld at fair value throughprofit or loss — (67,422) (67,422) — 34,427 34,427 — 38,395 38,395

Net foreign currency gains/(losses) — 17 17 — (2) (2) — (2) (2)

Income from investments 4,076 — 4,076 4,052 — 4,052 9,238 — 9,238Interest receivable and similarincome 60 — 60 15 — 15 37 — 37

Gross return/(loss) 4,136 (67,405) (63,269) 4,067 34,425 38,492 9,275 38,393 47,668Management fee (296) (690) (986) (287) (671) (958) (593) (1,386) (1,979)Other administrative expenses (232) — (232) (228) — (228) (490) — (490)

Net return/(loss) on ordinary activities before finance costs and taxation 3,608 (68,095) (64,487) 3,552 33,754 37,306 8,192 37,007 45,199

Finance costs (85) (196) (281) (57) (134) (191) (107) (250) (357)

Net return/(loss) on ordinaryactivities before taxation 3,523 (68,291) (64,768) 3,495 33,620 37,115 8,085 36,757 44,842

Taxation (74) — (74) (49) — (49) (197) — (197)

Net return/(loss) on ordinary activities after taxation 3,449 (68,291) (64,842) 3,446 33,620 37,066 7,888 36,757 44,645

Return/(loss) per share (note 3) 14.50p (287.06)p (272.56)p 14.47p 141.17p 155.64p 33.12p 154.35p 187.47p

All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinuedin the period.

The ‘Total’ column of this statement is the profit and loss account of the Company and the ‘Revenue’ and ‘Capital’ columns representsupplementary information prepared under guidance issued by the Association of Investment Companies.

The net return/(loss) on ordinary activities after taxation represents the profit/(loss) for the period/year and also the TotalComprehensive Income.

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S T A T E M E N T O F C O M P R E H E N S I V E I N C O M E


F I N A N C I A L S T A T E M E N T S | 1 5

S T A T E M E N T O F C H A N G E S I N E Q U I T Y


Called up Capital share redemption Capital Revenue capital reserve reserves reserve1 Total £’000 £’000 £’000 £’000 £’000

Six months ended 31st December 2018 (Unaudited)At 30th June 2018 6,350 3,650 291,173 12,957 314,130Repurchase of shares into Treasury — — (556) — (556)Net (loss)/return on ordinary activities — — (68,291) 3,449 (64,842)Dividends paid in the period (note 4) — — — (4,752) (4,752)

At 31st December 2018 6,350 3,650 222,326 11,654 243,980

Six months ended 31st December 2017 (Unaudited)At 30th June 2017 6,350 3,650 254,676 11,260 275,936 Repurchase of shares into Treasury — — (259) — (259)Net return on ordinary activities — — 33,620 3,446 37,066 Dividends paid in the period (note 4) — — — (4,286) (4,286)

At 31st December 2017 6,350 3,650 288,037 10,420 308,457

Year ended 30th June 2018 (Audited)At 30th June 2017 6,350 3,650 254,676 11,260 275,936 Repurchase of shares into Treasury — — (260) — (260)Net return on ordinary activities — — 36,757 7,888 44,645 Dividends paid in the period (note 4) — — — (6,191) (6,191)

At 30th June 2018 6,350 3,650 291,173 12,957 314,130

1 This reserve forms the distributable reserve of the Company and may be used to fund distributions to investors via dividend payments.


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S T A T E M E N T O F F I N A N C I A L P O S I T I O N

AT 31ST DECEMBER 2018

(Unaudited) (Unaudited) (Audited)31st December 2018 31st December 2017 30th June 2018

£’000 £’000 £’000

Fixed assets Investments held at fair value through profit or loss 246,738 316,947 328,569

Current assets Debtors 926 5,349 4,399Cash and cash equivalents 13,512 6,729 10,906

14,438 12,078 15,305

Current liabilitiesCreditors: amounts falling due within one year (9,196) (568) (29,744)

Net current assets 5,242 11,510 (14,439)

Total assets less current liabilities 251,980 328,457 314,130

Creditors: amounts falling due after more than one year (8,000) (20,000) —

Net assets 243,980 308,457 314,130

Capital and reserves Called up share capital 6,350 6,350 6,350Capital redemption reserve 3,650 3,650 3,650Capital reserves 222,326 288,037 291,173Revenue reserve 11,654 10,420 12,957

Total shareholders’ funds 243,980 308,457 314,130

Net asset value per share (note 5) 1,026.7p 1,295.3p 1,319.2p



S T A T E M E N T O F C A S H F L O W S


(Unaudited) (Unaudited) (Audited)31st December 2018 31st December 2017 30th June 2018

£’000 £’000 £’000

Net cash outflow from operations before dividends and interest (note 6) (1,197) (1,291) (2,514)

Dividends received 4,487 4,588 8,807 Interest received 34 12 27Overseas tax recovered 48 4 —Interest paid (219) (117) (315)

Net cash inflow from operating activities 3,153 3,196 6,005

Purchases of investments (46,239) (54,767) (124,434)Sales of investments 59,002 50,411 118,351Settlement of forward currency contracts (2) — —

Net cash inflow/(outflow) from investing activities 12,761 (4,356) (6,083)

Dividends paid (4,752) (4,286) (6,191)Repurchase of shares into Treasury (556) (259) (260)Drawdown of bank loan 8,000 16,000 21,000Repayment of bank loan (16,000) (14,000) (14,000)

Net cash (outflow)/inflow from financing activities (13,308) (2,545) 549

Increase/(decrease) in cash and cash equivalents 2,606 (3,705) 471

Cash and cash equivalents at start of period 10,906 10,434 10,434Exchange movements — — 1Cash and cash equivalents at end of period 13,512 6,729 10,906

Increase/(decrease) in cash and cash equivalents 2,606 (3,705) 471

Cash and cash equivalents consist of:Cash and short term deposits 1,287 347 251Cash held in JPMorgan Sterling Liquidity Fund 12,225 6,382 10,655

Total 13,512 6,729 10,906


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N O T E S T O T H E F I N A N C I A L S T A T E M E N T S


1. Financial statements

The information contained within the financial statements in this half year report has not been audited or reviewed by theCompany’s Auditor.

The figures and financial information for the year ended 30th June 2018 are extracted from the latest published financialstatements of the Company and do not constitute statutory accounts for that year. Those financial statements have beendelivered to the Registrar of Companies and included the report of the Auditor which was unqualified and did not containa statement under either section 498(2) or 498(3) of the Companies Act 2006.

2. Accounting policies

The financial statements have been prepared in accordance with the Companies Act 2006, FRS 102 ‘The Financial ReportingStandard applicable in the UK and Republic of Ireland’ of the United Kingdom Generally Accepted Accounting Practice(‘UK GAAP’) and with the Statement of Recommended Practice ‘Financial Statements of Investment Trust Companies and VentureCapital Trusts’ (the revised ‘SORP’) issued by the Association of Investment Companies in November 2014, and updated inFebruary 2018.

FRS 104, ‘Interim Financial Reporting’, issued by the Financial Reporting Council (‘FRC’) in March 2015 has been applied inpreparing this condensed set of financial statements for the six months ended 31st December 2018.

All of the Company’s operations are of a continuing nature.

The accounting policies applied to this condensed set of financial statements are consistent with those applied in the financialstatements for the year ended 30th June 2018.

3. Return/(loss) per share

(Unaudited) (Unaudited) (Audited)Six months ended Six months ended Year ended

31st December 2018 31st December 2017 30th June 2018£’000 £’000 £’000

Return/(loss) per share is based on the following:Revenue return 3,449 3,446 7,888Capital (loss)/return (68,291) 33,620 36,757

Total (loss)/return (64,842) 37,066 44,645

Weighted average number of shares in issue 23,789,582 23,815,805 23,814,255

Revenue return per share 14.50p 14.47p 33.12pCapital (loss)/return per share (287.06)p 141.17p 154.35p

Total (loss)/return per share (272.56)p 155.64p 187.47p




4. Dividends paid



2018 Final dividend of 18.5p (2017: 15.0p) per share 4,396 3,572 3,5722018 Special dividend of 1.5p (2017: 3.0p) per share 356 714 7142018 Interim dividend of 8.0p — — 1,905

Total dividends paid 4,752 4,286 6,191

All dividends paid in the period/year have been funded from the Revenue Reserve.

An interim dividend of 8.0p has been declared in respect of the six months ended 31st December 2018, to be paid on 17th April 2019.

5. Net asset value per share


31st December 2018 31st December 2017 30th June 2018

Net assets (£’000) 243,980 308,457 314,130Number of shares in issue 23,762,680 23,812,680 23,812,680

Net asset value per share 1,026.7p 1,295.3p 1,319.2p

6. Reconciliation of net (loss)/return on ordinary activities before finance costs and taxation to netcash outflow from operations before dividends and interest



Net (loss)/return on ordinary activities before finance costs and taxation (64,487) 37,306 45,199

Add capital loss/less capital return on ordinary activities before finance costs and taxation 68,095 (33,754) (37,007)

Decrease/(increase) in accrued income and other debtors 665 604 (269)Decrease in accrued expenses (31) (108) (40) Management fee charged to capital (690) (671) (1,386)Overseas withholding tax (247) (66) (174)Dividends received (4,487) (4,588) (8,807)Interest received (34) (12) (27)Realised gains/(losses) on foreign currency transactions 19 (2) (3)

Net cash outflow from operations before dividendsand interest (1,197) (1,291) (2,514)




7. Fair valuation of instruments

The fair value hierarchy analysis for financial instruments held at fair value at the period end is as follows:

(Unaudited) (Unaudited) (Audited)Six months ended Six months ended Year ended31st December 2018 31st December 2017 30th June 2018Assets Liabilities Assets Liabilities Assets Liabilities£’000 £’000 £’000 £’000 £’000 £’000

Level 1 246,738 — 316,947 — 328,569 —

Total 246,738 — 316,947 — 328,569 —


Interim Management Report

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2 2 | J P M O R G A N M I D C A P I N V E S T M E N T T R U S T P L C . H A L F Y E A R R E P O R T & F I N A N C I A L S T A T E M E N T S 2 0 1 8

I N T E R I M M A N A G E M E N T R E P O R T

The Company is required to make the following disclosures in its half year report.

Principal Risks and Uncertainties

The principal risks and uncertainties faced by the Company have not changed and fall into the following broad categories: investmentand strategy; financial; accounting, legal and regulatory; corporate governance and shareholder relations; and operational andcybercrime. Information on each of these areas is given in the Business Review within the Annual Report and Accounts for the yearended 30th June 2018.

Related Parties Transactions

During the first six months of the current financial year, no transactions with related parties have taken place which have materiallyaffected the financial position or the performance of the Company during the period.

Going Concern

The Directors believe, having considered the Company’s investment objectives, risk management policies, capital management policiesand procedures, nature of the portfolio and expenditure projections, that the Company has adequate resources, an appropriatefinancial structure and suitable management arrangements in place to continue in operational existence for the foreseeable future and,more specifically, that there are no material uncertainties pertaining to the Company that would prevent its ability to continue in suchoperation existence for at least twelve months from the date of the approval of this half yearly financial report. For these reasons, theyconsider there is reasonable evidence to continue to adopt the going concern basis in preparing the accounts.

Directors’ Responsibilities

The Board of Directors confirms that, to the best of its knowledge:

(i) the condensed set of financial statements contained within the half yearly financial report has been prepared in accordance withFRS 104 ‘Interim Financial Reporting’ and gives a true and fair view of the state of affairs of the Company and of the assets,liabilities, financial position and net return of the Company, as at 31st December 2018, as required by the UK Listing AuthorityDisclosure and Transparency Rules 4.2.4R; and

(ii) the interim management report includes a fair review of the information required by 4.2.7R and 4.2.8R of the UK ListingAuthority Disclosure Guidance and Transparency Rules.

In order to provide these confirmations, and in preparing these financial statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent;

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed andexplained in the financial statements; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continuein business;

and the Directors confirm that they have done so.

For and on behalf of the BoardMichael HughesChairman 25th February 2019


Shareholder Information


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Return to Shareholders (APM)

Total return to the shareholder, on a last traded price to last traded price basis, assuming that all dividends received were reinvested,without transaction costs, into the shares of the Company at the time the shares were quoted ex-dividend.

Period endedTotal return calculation Page 31st December 2018

Opening share price (p) 4 1250.0 (a)Closing share price (p) 4 974.0 (b)Total dividend adjustment factor1 1.019512 (c)Adjusted closing share price (d = b x c) 993.0 (d)

Total return to shareholder (e = d / a – 1) –20.6% (e)

1 The dividend adjustment factor is calculated on the assumption that the dividends paid out by the Company are reinvested into the shares of the Company at the last tradedprice quoted at the ex-dividend date.

Return on Net Assets (APM)

Total return on net asset value (‘NAV’) per share, on a bid value to bid value basis, assuming that all dividends paid out by the Companywere reinvested, without transaction costs, into the shares of the Company at the NAV per share at the time the shares were quotedex-dividend.

Period endedTotal return calculation Page 31st December 2018

Opening cum-income NAV per share (p) 1319.2 (a)Closing cum-income NAV per share (p) 1026.7 (b)Total dividend adjustment factor2 1.017920 (c)Adjusted closing cum-income NAV per share (d = b x c) 1045.1 (d)

Total return on net assets (e = d / a – 1) –20.8% (e)

2 The dividend adjustment factor is calculated on the assumption that the dividends paid out by the Company are reinvested into the shares of the Company at the cum-incomeNAV at the ex-dividend date.

Benchmark return

Total return on the benchmark, on a closing-market value to closing-market value basis, assuming that all dividends received werereinvested, without transaction costs, in the shares of the underlying companies at the time the shares were quoted ex-dividend(see page 3).

The benchmark is a recognised index of stocks which should not be taken as wholly representative of the Company’s investmentuniverse. The Company’s investment strategy does not follow or ‘track’ this index and consequently, there may be some divergencebetween the Company’s performance and that of the benchmark.


GLOSSARY OF TERMS AND ALTERNATIVE PERFORMANCE MEASURES (‘APMs’) (UNAUDITED)


GLOSSARY OF TERMS AND ALTERNATIVE PERFORMANCE MEASURES (‘APMs’) (UNAUDITED)

S H A R E H O L D E R I N F O R M A T I O N | 2 5

Gearing/Net cash (APM)

Gearing represents the excess amount above shareholders’ funds of total investments, expressed as a percentage of the shareholders’funds. If the amount calculated is negative, this is shown as a ‘net cash’ position.

31st December 30th June 2018 2018Gearing calculation Page £’000 £’000

Investments held at fair value through profit or loss 16 246,738 328,569 (a)

Net assets 16 243,980 314,130 (b)

Gearing/(Net cash) (c = a / b – 1) 1.1% 4.6% (c)

Ongoing charges ratio (APM)

The ongoing charges ratio represents the Company’s management fee and all other operating expenses excluding finance costspayable, expressed as a percentage of the average of the daily cum-income net assets during the year and is calculated in accordancewith guidance issued by the Association of Investment Companies.

The figure as at 31st December 2018 is an estimated figure based on the actual figures for the six months ended 31st December 2018.

31st December 30th June 2018 2018Ongoing charges ratio calculation Page £’000 £’000

Management fee 14 1,972 1,979Other administrative expenses 14 464 490

Total management fee and other administrative expenses 2,436 2,469 (a)

Average daily cum-income net assets 285,271 299,117 (b)

Ongoing charges ratio (c = a / b) 0.85% 0.83% (c)

Share Price Discount/Premium to Net Asset Value (‘NAV’) per Share (APM)

If the share price of an investment trust is lower than the NAV per share, the shares are said to be trading at a discount. The discount isshown as a percentage of the NAV per share.

The opposite of a discount is a premium. It is more common for an investment trust’s shares to trade at a discount than at a premium(page 4).


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W H E R E T O B U Y J . P . M O R G A N I N V E S T M E N T T R U S T S

You can invest in a J.P. Morgan investment trust through thefollowing:

1. Directly from J.P. Morgan

Investment Account

The Company’s shares are available in the J.P. Morgan InvestmentAccount, which facilitates both regular monthly investments andoccasional lump sum investments in the Company’s ordinaryshares. Shareholders who would like information on theInvestment Account should call J.P. Morgan Asset Managementfree on 0800 20 40 20 or visit its website atam.jpmorgan.co.uk/investor

Stocks & Shares Individual Savings Accounts (ISA)

The Company’s shares are eligible investments withina J.P. Morgan ISA. For the 2018/19 tax year, from 6th April 2018and ending 5th April 2019, the total ISA allowance is £20,000.This allowance is the same for the 2019/2020 tax year. The sharesare also available in a J.P. Morgan Junior ISA. Details are availablefrom J.P. Morgan Asset Management free on 0800 20 40 20 orvia its website at am.jpmorgan.co.uk/investor

2. Via a third party provider

Third party providers include:

Please note this list is not exhaustive and the availability ofindividual trusts may vary depending on the provider. Thesewebsites are third party sites and J.P. Morgan Asset Managementdoes not endorse or recommend any. Please observe each site’sprivacy and cookie policies as well as their platform chargesstructure.

3. Through a professional adviser

Professional advisers are usually able to access the products of allthe companies in the market and can help you find an investmentthat suits your individual circumstances. An adviser will let youknow the fee for their service before you go ahead. You can findan adviser at unbiased.co.uk

You may also buy investment trusts through stockbrokers, wealthmanagers and banks.

To familiarise yourself with the Financial Conduct Authority (FCA)adviser charging and commission rules, visit fca.org.uk

AJ BellAlliance Trust SavingsBarclays Smart InvestorBestinvestCharles Stanley Direct

FundsNetworkHargreaves LansdownInteractive InvestorSelftradeThe Share Centre



S H A R E H O L D E R I N F O R M A T I O N

Avoid investment fraud1 Reject cold calls

If you’ve received unsolicited contact about an investment opportunity, chances are it’s a high risk investment or a scam. You should treat the call with extreme caution. The safest thing to do is to hang up.

2 Check the FCA Warning List The FCA Warning List is a list of �rms and individuals we know are operating without our authorisation.

3 Get impartial advice Think about getting impartial �nancial advice before you hand over any money. Seek advice from someone unconnected to the �rm that has approached you.

Report a ScamIf you suspect that you have been approached by fraudsters please tell the FCA using the reporting form at www.fca.org.uk/consumers/report-scam-unauthorised-�rm. You can also call the FCA Consumer Helpline on 0800 111 6768

If you have lost money to investment fraud, you should report it to Action Fraud on 0300 123 2040 or online at www.actionfraud.police.uk

Find out more at www.fca.org.uk/scamsmart

Investment scams are designed to look like genuine investmentsSpot the warning signs

Have you been:

• contacted out of the blue• promised tempting returns

and told the investment is safe• called repeatedly, or• told the offer is only available

for a limited time?

If so, you might have been contacted by fraudsters. Remember: if it sounds too good to be true,

it probably is!

Be ScamSmart


I N F O R M A T I O N A B O U T T H E C O M P A N Y

HistoryJPMorgan Mid Cap Investment Trust plc was launched in 1972 as Crossfriars TrustLimited. The Company changed its name to The Fleming Enterprise InvestmentTrust plc in 1982. It adopted its current investment policy of concentrating onFTSE 250 companies in 1993. The Company changed its name to The FlemingMid Cap Investment Trust plc in October 1998, JPMorgan Fleming Mid CapInvestment Trust plc in October 2001 and adopted its present name on9th November 2005.

DirectorsMichael Hughes (Chairman)John EvansRichard GubbinsRichard Huntingford (Senior Independent Director)Margaret Littlejohns (Chairman of the Audit Committee)

Company NumbersCompany registration number: 1047690London Stock Exchange Sedol number: 0235761 Bloomberg code: JMF LN549300QED7IGEP4UFN49LEI: 549300QED7IGEP4UFN49

Market InformationThe Company’s net asset value (‘NAV’) is published daily via the London StockExchange. The Company’s shares are listed on the London Stock Exchange and theprice is noted daily in the Financial Times, The Times, The Daily Telegraph, TheScotsman and on the J.P. Morgan website at www.jpmmidcap.co.uk, where theshare price is updated every fifteen minutes during trading hours.

Websitewww.jpmmidcap.co.uk

Share TransactionsThe Company’s shares may be dealt in directly through a stockbroker orprofessional adviser acting on an investor’s behalf. They may also be purchasedand held through the J.P. Morgan Investment Account, J.P. Morgan ISA andJ.P. Morgan Junior ISA. These products are all available on the online service atjpmorgan.co.uk/online

Manager and Company SecretaryJPMorgan Funds Limited.

Company’s Registered Office60 Victoria EmbankmentLondon EC4Y 0JPTelephone number: 020 7742 4000

For company secretarial and administrative matters please contact Alison Vincent.

DepositaryThe Bank of New York Mellon (International) Limited1 Canada SquareLondon E14 5AL

The Depositary has appointed JPMorgan Chase Bank, N.A. as the Company’sCustodian.

RegistrarsEquiniti LimitedReference 1082Aspect HouseSpencer RoadLancingWest Sussex BN99 6DATelephone number: 0371 384 2321

Lines open 8.30 a.m. to 5.30 p.m. Monday to Friday. Calls to the helpline will costno more than a national rate call to a 01 or 02 number. Callers from overseasshould dial +44 121 415 0225.

Notifications of changes of address and enquiries regarding certificatesor dividend cheques should be made in writing to the Registrar quotingreference 1082.

Registered shareholders can obtain further details on individual holdings on theinternet by visiting www.shareview.co.uk

Independent AuditorsPricewaterhouseCoopers LLPChartered Accountants and Statutory Auditors7 More London RiversideLondon SE1 2RT

BrokersNumis Securities LimitedThe London Stock Exchange Building10 Paternoster SquareLondon EC4M 7LT

Savings Product AdministratorsFor queries on the J.P. Morgan Investment Account and J.P. Morgan ISA,see contact details on the back cover of this report.

FINANCIAL CALENDAR

Financial year end 30th June

Interim results announced February/March

Final results announced October

Half yearly dividends on ordinary shares paid November, April

Annual General Meeting November

A member of the AIC


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www.jpmmidcap.co.uk

Telephone calls may be recorded and monitored for security and training purposes.

GB I121 | 02/19

J.P. MORGAN HELPLINE

Freephone 0800 20 40 20 or +44 (0) 1268 444470.Telephone lines are open Monday to Friday, 9am to 5.30pm.

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