Artemis UK Future Leaders plc (AFL)

The Investment Trust has changed its manager as part of a strategic decision to improve the Trust's investment performance, align with the evolving market conditions, and ensure the fund's long-term growth. The new manager brings fresh expertise and a proven track record of investing in UK smaller companies.

The new manager is Artemis Fund Managers, a leading investment management firm with extensive experience in managing UK small cap portfolios. The firm launched the Artemis UK Smaller Companies fund in 1998 and the current team have been managing it together for nearly 10 years. The team has demonstrated a consistent ability to deliver strong returns and navigate market challenges effectively.

Mark Niznik and Will Tamworth are the new co-fund managers of the Trust. Mark joined Artemis in 2007 and Will in 2015.

They have worked together since 2015 and bring considerable expertise in the UK small-cap equity space. They are supported by a deep bench of UK equity fund managers at Artemis who meet regularly to share ideas and insights on events and trends impacting UK equities. The UK team has been very stable (average tenure at Artemis of the 10 UK fund managers is 14 years).

The name change (from Invesco UK Smaller Companies Investment Trust plc to Artemis UK Future Leaders plc) is part of a rebranding effort to reflect the new direction and strategic goals of the Trust under the new management. The new name is designed to better align with the fund’s investment approach and market positioning.

The fund managers invest in companies that are leaders in their niches. This gives them a greater chance of earning above average returns and, critically in the current inflationary backdrop, a greater chance of having pricing power (it does not guarantee either). Future is a reminder that market positions are not static. We like to invest in companies that can strengthen existing leadership positions or establish new leadership positions.

While the new manager may introduce some modifications in the approach to investment, the overall strategy will remain aligned with the Trust’s objectives. Investors can expect a continued focus on UK small caps though there will be a greater focus on company valuations.

The change in manager and name is not expected to have an immediate impact on the value of your investment.

The Trust will continue to operate as usual, and the fund's performance will depend on the market conditions and the manager's strategy.

No immediate action is required from investors. Your investment will continue to be managed in line with the Trust’s objectives, and you will be notified of any significant changes that may require action. You may want to review the Trust's updated documentation for details on the changes.

We will communicate all important updates via official channels, including email notifications, the Trust's website, and shareholder meetings. Additionally, the updated fund documentation is available for review.

No, your shares will remain the same, and you will continue to hold your investment in the trust. The only change is the name of the trust, which will be reflected in official documents and communications. If you hold paper share certificates they will remain valid and we will not be issuing new certificates.

Yes, the Trust will continue to trade as usual.

For more information contact our shareholder services team on 0800 092 2051. Updated documentation and information is available on this page.

Artemis will charge a management fee of 0.65% of net assets up to £50 million and 0.55% thereafter (compared to the fee of 0.75% of gross assets currently paid by the Company). Artemis also agreed to waive the first nine months of management fees post appointment (to December 2025).

There is no plan to change the dividend policy. The Trust's dividend policy is to distribute all available revenue earned by the portfolio in the form of dividends to shareholders. In addition, the Board has approved the use of the Trust's capital reserves to enhance dividend payments. Therefore, the total dividend, paid to shareholders on a quarterly basis, comprises income received from the portfolio, with the balance coming from capital reserves. In normal circumstances, the dividend for the year is calculated to give a yield of 4.0% based on the year-end share price.

The investment team, approach and philosophy will be consistent across the two strategies. The key difference will be that in the Investment Trust the team will take advantage of the closed ended structure to have slightly more exposure to micro-caps and run a slightly more concentrated portfolio. In the future they may also take advantage of the Investment Trust’s ability to use leverage.

Over the long-term (since 1955) UK small caps have outperformed large caps by 3% p.a. UK micro-caps have done even better – outperforming by over 4% p.a. The enormous power of compounding means this translates to a 16.6x relative outperformance over this period. Despite this outperformance this is an area of the market that is increasingly overlooked due to greater scrutiny over the liquidity profile of open-ended funds. We also see greater scope for smaller companies – which naturally get less attention – to be mispriced. The Trust's size and closed ended nature leaves it ideally positioned to exploit this opportunity.

The team has extensive experience of investing in micro caps and knows the universe well. Within the open-ended fund they have just limited their exposure to these companies with an eye on liquidity. The managers will not invest in unquoted companies. They see this as requiring a different skill set.

The managers will not invest in unquoted companies. They see this as requiring a different skill set.