ICG Enterprise Trust
Annual Report 2022

Plain-text annual report

Defensive growth from a balanced private equity portfolio ICG Enterprise Trust Plc Annual Report and Accounts 2022 An actively managed portfolio delivering attractive compounding returns over the long term We invest in companies that are established, profitable and cash generative. We make these investments directly and through funds managed by ICG and third-party managers. 1 STRATEGIC REPORT 1 Highlights 2 At a glance 4 How we access the market 6 How we work with our Manager 8 Fulfilling our purpose 10 Chair’s statement 12 Manager’s review 20 30 largest underlying companies 24 Investing responsibly 26 People and culture 32 Key performance indicators 34 Stakeholder engagement 38 How we manage risk 40 Principal risks and uncertainties 44 GOVERNANCE 44 Governance overview 46 Board of Directors 48 Corporate governance report 52 Report of the Directors 55 Investment policy 56 Directors’ remuneration report 60 Report of the Audit Committee 62 Additional disclosures required by the Alternative Investment Fund Managers Directive Statement of Directors’ responsibilities 63 Direct Investments Secondary Investments Primary Funds 4 How we access the market 64 FINANCIAL STATEMENTS 64 Independent auditor’s report to the members of ICG Enterprise Trust Plc 70 Income statement 71 Balance sheet 72 Cash flow statement 73 Statement of changes in equity 74 Notes to the financial statements 91 OTHER INFORMATION 91 30 largest fund investments 93 Portfolio analysis 96 Glossary 99 Shareholder information 100 How to invest in ICG Enterprise Trust Plc www.icg-enterprise.co.uk ICG Enterprise Trust Plc This year, our net asset value passed £1bn. We have delivered strong returns, in a very active market, and have continued to develop our track record of delivering long-term shareholder value. JANE TUFNELL Chair 10 Chair’s statement1 Highlights 1,690p NAV per Share (31 January 2021: 1,384p) 24.4% NAV per Share Total Return2,3 (31 January 2021: 22.5%) 16.4% NAV per Share Total Return five-year annualised2,3 (31 January 2021: 15.9%) 27p Total dividend (31 January 2021: 24p) 1 In the Chair’s statement, Manager’s review and Other information sections, reference is made to the ‘Portfolio’ (2022: £1,172.2m; 2021: £949.2m). The Portfolio is an Alternative Performance Measure (‘APM’), defined as the aggregate of the investment portfolios of the Company and of its subsidiary limited partnerships. The Board and Manager consider that disclosing our Portfolio assists shareholders in understanding the value and performance of the portfolio companies which comprise the assets of the ICG Enterprise Trust, held through underlying fund investments and co-investments selected by the Manager. The Portfolio does not include the Co-investment Incentive Scheme Accrual (2022: £49.1m; 2021: £41.8m). This ensures Portfolio returns are not distorted by certain funds and Direct Investments on which ICG Enterprise Trust Plc does not incur Co-investment Incentive Scheme costs (for example, on funds managed by Intermediate Capital Group plc (‘ICG’)). Portfolio is related to the Net Asset Value, which is the value attributed to our shareholders, and which also incorporates the Co-investment Incentive Scheme Accrual as well as the value of cash on our balance sheet. Further details are set out in the Glossary on pages 96 to 98. 2 This is an APM. Further details are set out in the Glossary on pages 96 to 98. 3 Throughout this report, all share price and NAV per Share performance figures are stated on a Total Return basis (i.e. including the effect of reinvested dividends). 12 Manager’s review1 Our focus on investing in sustainable companies, in developed markets with a focus on defensive growth position, is well positioned to navigate dynamic market conditions. OLIVER GARDEY Head of Private Equity Fund Investments ICG Enterprise Trust Plc Annual Report and Accounts 2022 1 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONAt a glance OUR PURPOSE AND STRATEGY Our purpose To provide shareholders with access to the attractive long-term returns generated by investing in private companies, with the added benefit of daily liquidity 8 Fulfilling our purpose We seek to invest in cash-generative companies primarily in the US, Europe and the UK US 40% of the Portfolio Europe 31% of the Portfolio UK and other 29% of the Portfolio Our strategic objectives Portfolio as % of net assets 98% Five-year average Increase amount deployed into High Conviction Investments as % of capital invested Maintain exposure to US market (%) 49% Of Portfolio 40–50% Medium-term expectation for US investments to represent as a proportion of Portfolio value 10 Chair’s statement How we succeed Experienced listed private equity investor FOCUSED Invest in profitable private companies, primarily in the US, Europe and the UK. SELECTIVE Generating strong and consistent returns, while limiting downside risk. DIFFERENTIATED Actively construct a balanced Portfolio of companies with defensive growth characteristics. ACCESS Proprietary deal flow from the wider ICG network. INSIGHTS Into private equity managers and companies through local teams across the globe. EXPERTISE Investment track record and broader operational platform. Access to our Manager’s global network 6 How we work with our Manager Generating long-term shareholder value 2 ICG Enterprise Trust Plc Annual Report and Accounts 2022 S T R AT E G I C R E P O RT HOW WE MANAGE OUR PORTFOLIO Leveraging our differentiators Our business model enables us to realise long-term value by combining our proven strategy alongside our Manager’s global platform 12 Manager’s review Our competitive advantages Thorough investment process Including ESG considerations and disciplined capital allocation SOURCE OPPORTUNITIES The team actively sources new opportunities, maintaining close relationships with private equity managers. As part of ICG, the team also benefits from insights and proprietary deal flow from the wider ICG network. REINVEST OR RETURN1 Proceeds from the sales of Portfolio companies are reinvested in new investment opportunities, or returned to shareholders through dividends or share buybacks. Find out more about our approach to capital allocation on page 34. SOURCE OPPORTUNITIES ANALYSE & INVEST REINVEST OR RETURN MONITOR & ACTIVELY MANAGE PORTFOLIO ANALYSE & INVEST1 Ahead of any investment, deep and granular due diligence is undertaken. A detailed investment recommendation is then discussed by the Investment Committee and, if approved, moves to legal review. MONITOR & ACTIVELY MANAGE PORTFOLIO1 Underlying performance is closely monitored and the Portfolio’s exposures are actively managed to ensure consistent strong performance. Finance & risk Sales & marketing Operations Underpinned by our operating platform 26 People and culture 1 Investment Committee oversight. ICG Enterprise Trust Plc Annual Report and Accounts 2022 3 GOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONHow we access the market A differentiated approach generating attractive returns We seek to invest in companies that are established, profitable and cash generative. We make these investments directly and through funds managed by ICG and third-party managers, taking account of ESG considerations throughout our investment process. We aim to build a portfolio of companies with defensive growth characteristics to deliver consistently strong returns over the long term. 12 Manager’s review 20 30 largest underlying companies 26 People and culture INVESTMENT TYPE Primary Funds Commitments to new private equity funds. THIRD PARTY FUNDS £599m 51% of our Portfolio 18% Five-year annualised Portfolio Return on a Local Currency Basis ICG chooses the manager of the funds. Secondary Investments Acquiring fund interests and commitments from other investors. Direct Investments Investing directly in companies alongside funds managed by ICG and third-party fund managers. HIGH CONVICTION INVESTMENTS £573m 49% of our Portfolio 24% Five-year annualised Portfolio Return on a Local Currency Basis High Conviction Investments are those in which ICG actively selects the underlying portfolio companies and includes ICG-managed Primary Funds. 4 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Indicative cash profile IN Fund OUT Year 0 Year 10 Investment period Indicative cash profile IN Fund OUT Year 0 Year 5 Investment period Indicative cash profile IN Fund OUT Year 0 Investment period Year 10 OUR PORTFOLIO TODAY 57% Of Portfolio ICG Other 18% Of Portfolio ICG Other 25% Of Portfolio ICG Other 20% Five-year annualised Portfolio Return on a Local Currency Basis ICG Enterprise Trust Plc Annual Report and Accounts 2022 5 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONHow we work with our Manager A six-year relationship generating shareholder value Since ICG became the Manager, our Portfolio has grown its exposure to North America and become more fully invested. Our Manager’s expertise and access provide us with substantial benefits, and our unique access to ICG-managed funds and associated co-investment opportunities has generated substantial value for our shareholders. ICG appointed as Manager of ICG Enterprise Trust ICG becomes the Manager of Graphite Enterprise Trust in February 2016, which is renamed ‘ICG Enterprise Trust’. £428m Portfolio valuation 31 Jan 2016 31 Jan 2017 31 Jan 2018 31 Jan 2019 31 Jan 2020 31 Jan 2021 31 Jan 2022 Greater access We invest in ICG-managed funds and are offered significant Direct Investment opportunities through these commitments and our close relationship with the Manager. Growth in ICG-managed Direct Investments in the Portfolio Since 2016 2016 2022 9 Direct Investments 1 Direct Investment 9.0x Leading global alternative asset manager Our Manager, ICG, is a global alternative asset manager that provides capital to help companies develop and grow. It has $71bn of assets under management and is a constituent of the FTSE 100. ICG invests in private companies, combining local access and insight with an entrepreneurial approach to give it a competitive edge in its markets. ICGAM.COM 6 ICG Enterprise Trust Plc Annual Report and Accounts 2022 £1bn+ Portfolio valuation 12 Manager’s review £428m Portfolio valuation TOTAL SHAREHOLDER RETURN Our shares have delivered positive shareholder returns over the long term. At 31 January 2022 the five-year annualised total shareholder return was 14.3%. 31 Jan 2016 31 Jan 2017 31 Jan 2018 31 Jan 2019 31 Jan 2020 31 Jan 2021 31 Jan 2022 Deeper insights Superior expertise With 525 employees in 15 offices globally and managing $71bn of assets across 20 investment strategies, our Manager provides significant insights into private market trends, sector themes and company performance. Our operational platform and broader approach benefit from our Manager’s expertise, in particular regarding responsible investing. Growth in global fund strategies Since 2016 2016 2022 20 Global ICG strategies 15 Global ICG strategies 1.3x Growth in ICG strategies invested in Since 2016 2016 2022 5 Invested ICG strategies 1 Invested ICG strategy 5.0x ICG Enterprise Trust Plc Annual Report and Accounts 2022 7 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Fulfilling our purpose Our purpose is to provide shareholders with access to the attractive long-term returns generated by investing in private companies, with the added benefit of daily liquidity At ICG Enterprise Trust, our purpose is clear and our track record of fulfilling it is strong. It defines the way we manage our Portfolio and our approach to selecting new investments. By fulfilling our purpose, we generate value for stakeholders. 8 ICG Enterprise Trust Plc Annual Report and Accounts 2022 By encouraging entrepreneurial and responsible management, supported by a robust governance framework, we support the creation of long-term, sustainable value. 44 Governance overview ce n a n r e v o G P e o p le a n d culture The people who execute on our strategy underpin our success. 26 People and culture We aim to build a portfolio of companies with defensive growth characteristics that will generate consistently strong returns for shareholders, over the long term. 4 How we access the market v e s t m ent strategy I n Our purpose Impacting all aspects of our business By understanding our stakeholders, we take a holistic view of the potential impact of our decision. 34 Stakeholder engagement S t a k e h o l d e r s si b le investing n o R e s p A targeted approach to responsible investing embedded within our investment approach. 24 Investing responsibly ICG Enterprise Trust Plc Annual Report and Accounts 2022 9 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Chair’s statement We are encouraged by the strong performance of our Portfolio, which is a testament to our strategy and our focus on investments with defensive growth characteristics. JANE TUFNELL Chair Performance highlights 29.4% Portfolio Return on a Local Currency Basis 24.4% NAV per Share Total Return 27p Dividend per share I am pleased to report that your Company1 has performed strongly during the year, continuing to build on its track record of delivering strong risk-adjusted returns for its shareholders. ICG Enterprise Trust’s NAV at 31 January 2022 was £1.2bn, equating to 1,690p NAV per Share. The Company has delivered 24.4% NAV per Share Total Return during the financial year. On a five-year annualised basis, NAV per Share Total Return is 16.4%. This performance is net of all fees. The performance underlines the benefits of our strategy, with our more focussed High Conviction Portfolio enhancing the returns of our more diversified Third Party Investments over the long term. In line with this approach, ICG Enterprise Trust has continued to deploy capital into a number of High Conviction Investments. I have been particularly pleased to see four new Co-investments alongside our Manager, ICG, and the significant progress we have made during the year on developing our portfolio of Secondary Investments. 10 ICG Enterprise Trust Plc Annual Report and Accounts 2022 1 ICG Enterprise Trust Plc. We were able to make these investments given the strong Realisation activity we experienced: during the year we received Total Proceeds of £342.9m and deployed £303.7m into new investments, generating net proceeds of £39.2m. At 31 January 2022 we had £208.4m of available liquidity. Following the tragic events in Ukraine this calendar year, we are mindful of the heightened levels of volatility and geopolitical uncertainty. While we have no material direct exposure to Russia or Ukraine, we remain conscious of the potential indirect impact of macroeconomic risks such as increasing energy prices, disrupted supply chains, and a squeeze on consumer spending. In this environment, we feel our focus on businesses with defensive growth characteristics positions us well to navigate these dynamic market conditions. We remain alert to the changing situation and potential risks. More detail on our risk management can be found on page 38. DELIVERING ON OUR STRATEGIC GOALS We made further progress against our strategic goals: our new investment activity was heavily weighted towards High Conviction Investments (61.1% of Total New Investments in FY22) and maintained our North American exposure in line with our target range of 40 – 50%. During the year, the Board determined that we should develop our Secondaries programme more systematically and that we should target allocating 15 – 25% of the Portfolio to Secondary Investments. In line with this, we made a number of investments during the year which meaningfully increased our exposure, bringing it within this target range (31 January 2022: 17.9%; 31 January 2021: 11.8%). High Conviction Investments represented 48.9% of the Portfolio at 31 January 2022 and have generated an annualised local currency return of 23.9% over the last five years. We expect these investments to continue to enhance the strong returns generated from our Third Party Funds, which have returned an annualised local currency return of 17.8% over the last five years. Since appointing ICG as the Manager six years ago, we have become more fully invested, reducing the impact of cash drag on performance. At 31 January 2022 the Portfolio represented 101.2% of Net Assets (31 January 2016: 82.1%). PROVIDING PUBLIC ACCESS TO PRIVATE EQUITY There is an increasing recognition that private equity can play a valuable role for both individual and institutional investors with a long-term perspective. However, it can be challenging for certain investors to gain exposure to private equity assets. ICG Enterprise Trust helps to solve this problem: by investing in ICG Enterprise Trust, shareholders gain access to a mature and Strategic progress We continued to make progress towards our strategic objectives Investment Portfolio as % of net assets 98% Five-year average Balance sheet efficiency maintained Increase amount deployed into High Conviction Investments as % of capital invested 49% Of Portfolio 10 new Direct Investments made during the year Maintain exposure to US market (%) 40–50% Medium-term expectation for US investments as a proportion of Portfolio value Exposure to US market maintained during the year (31 January 2022: 41%) 32 Key performance indicators actively managed portfolio of private equity investments, with the added benefit of daily liquidity. Despite the Company’s strong and consistent track record, ICG Enterprise Trust’s shares continue to trade at a Discount to NAV (26.3% on 31 January 2022 against last published NAV of 1,628p at 31 October 2021). The Board considers that the Company’s performance, and the value of its Manager’s expertise and network, are not appropriately recognised in its share price. During the year we have worked closely with the investment community, including professional, institutional, and private wealth managers, stock market analysts, and the media to increase ICG Enterprise Trust’s profile and improve investors’ understanding of the sector and our role within it. IMPORTANCE OF INVESTING RESPONSIBLY Responsible investing remains a focus for our investment team, who are able to utilise the Manager’s considerable resources in this area to support their own investment analysis to ensure that our investment programme is compatible with our wider ESG framework. The Board believes that the long-term success of the Company requires the effective management of both financial and non-financial measures, and fully endorses the increasing emphasis on this important topic. BOARD EVOLUTION Sandra Pajarola is retiring from the Board on 28 June 2022, having served as a non-executive director for nine years. During her tenure, Sandra has been an invaluable member of the Board, bringing a wealth of experience and expertise to our discussions, in particular around private equity investing. On behalf of the Board and the shareholders of ICG Enterprise Trust, I would like to extend my sincere thanks to Sandra for her dedication and many contributions, and to wish her all the very best for her future endeavours. In line with our focus on appropriate Board composition and succession planning, the Board is undertaking a search for new non-executive directors and will update shareholders in due course. DIVIDEND AND SHARE BUYBACK The Board continues to view the dividend as an important component of shareholder return and remains committed to a progressive dividend policy. The Board is proposing a final dividend of 9p per share. Together with the three interim dividends of 6p per share each, this will take total dividends for the year to 27p per share, representing a 12.5% increase on the prior year dividend. This marks the sixth consecutive year of dividend increases. During the year the Board also purchased 250,000 shares at an average price of 1,070p each. In aggregate the Board therefore allocated £21.2m1 to cash returns to shareholders during FY22. ANNUAL GENERAL MEETING The Annual General Meeting will be held on 28 June 2022. The Board will be formally communicating with shareholders outlining the format of the meeting separately in the Notice of Meeting. This will include details of how shareholders may register their interest in attending the Annual General Meeting, either in person or via videoconference. WELL PLACED TO CONTINUE TO GENERATE VALUE FOR OUR SHAREHOLDERS ICG Enterprise Trust is in good health, with a strong balance sheet and a diversified Portfolio that remains well-positioned to withstand the increased volatility that has affected the global markets so far in 2022. We are encouraged by the performance of our Portfolio, which is a testament to our strategy and our focus on investments with defensive growth characteristics. We believe we offer an attractive investment vehicle for public market investors to access high-quality, privately-owned businesses. The structure of the Portfolio enables the Company to benefit from diversification whilst retaining more concentrated exposure to High Conviction Investments with defensive growth characteristics. This approach has successfully generated double-digit NAV per Share Total Return to our shareholders not only in the last year but over the long term. We are confident that your Company has the expertise, network and financial resources to successfully execute on its strategy, and we believe that we have a promising future. Jane Tufnell Chair 11 May 2022 1 Being the sum of all ordinary dividends declared during FY22, including the proposed final dividend, and the value of all shares bought back during the year. ICG Enterprise Trust Plc Annual Report and Accounts 2022 11 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Manager’s review We enter the new year well positioned to navigate periods of uncertainty, with our focus on buyouts of high quality, cash generative companies that have attractive market positions and robust levers of growth. OLIVER GARDEY Head of Private Equity Fund Investments Alternative Performance Measures The Board and the Manager monitor the financial performance of the Company on the basis of Alternative Performance Measures (‘APM’), which are non-IFRS measures. The APM predominantly form the basis of the financial measures discussed in this review, which the Board believes assists shareholders in assessing their investment and the delivery of the investment strategy. The Company holds certain investments in subsidiary entities. The substantive difference between APM and IFRS is the treatment of the assets and liabilities of these subsidiaries. The APM basis ‘looks through’ these subsidiaries to the underlying assets and liabilities they hold, and it reports the investments, less the Co-investment scheme liability, as the Portfolio APM. Under IFRS, the Company and its subsidiaries are reported separately. The assets and liabilities of the subsidiaries are presented on the face of the IFRS balance sheet as a single carrying value. The same is true for the IFRS and APM basis of the Cash flow statement. The Company’s Investments (IFRS) were £1,124.0m (2021: £907.5m), an increase of 23.8% on the prior year; Net Asset Value (‘NAV’) (IFRS) was £1,158.0m (2021: £952.0m), an increase of 21.6% on the prior year; and Portfolio (APM) was £1,172.2m (2021: 949.2m), an increase of 23.5% on the prior year. Cash flows from the sale of portfolio investments (IFRS) were £101.0m (2021: £147.5m) while Total Proceeds (APM) were £342.9m (2021: £209.2m) including Realisation Proceeds (APM) of £333.5m (2021: £137.3m). Cash flows related to the purchase of Portfolio investments (IFRS) were £75.1m (2021: £86.1m), while Total New Investment (APM) was £303.7m (2021: £139.2m). The Glossary on pages 96 to 98 includes definitions for all APM and, where appropriate, a reconciliation between APM and IFRS. 12 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Performance highlights 29.4% Portfolio Return on a Local Currency Basis1 (31 January 2021: 24.9%) 27.1% Top 30 companies’ revenue growth over the last 12 months (31 January 2021: 15.0%) 2.6x Multiple of cost of realisations1 (31 January 2021: 2.4x) 1 This is an APM as defined in the Glossary on page 96. Market overview: key trends influencing performance RECORD LEVELS OF GLOBAL PRIVATE EQUITY ACTIVITY Trends Deal activity rebounded strongly in 2021, following the slowdown in 2020 driven by COVID-19. Global private equity buyout deal value reached record highs in 20211, breaking the $1 trillion level for the first time, with a significant increase in both volumes and average deal size1. Looking at 2021 buyout deal value on a regional basis, North America saw the strongest growth, increasing 120% year-on-year, and Europe by 79%. Our positioning Our managers have capitalised on the market activity, crystallising value for our shareholders through record Realisation Proceeds of £333.5m. We have also deployed substantial capital during the year, with a focus on High Conviction Investments, including 10 new Direct Investments. IMPORTANCE OF THE US IN PRIVATE EQUITY MARKETS CONTINUES Trends In 2021, US private equity saw the largest increase in deal value on both a relative and absolute basis with North American buyout transaction value matching the 2020 global total.1 The North American market is the largest private equity market globally in both primary and secondary transactions, with North American sellers accounting for over 72% of global secondary volumes in 2021.2 Our positioning Building on our relationships with best-in-class managers in the US, we have continued to commit to existing and new third-party managers in the US. Investments in North America represented 41% of the Portfolio at 31 January 2022. SECONDARIES DEAL FLOW HIT RECORD HIGH Trends Secondary transaction volumes in 2021 increased 137% year-on- year, to a total of $133.2bn2. 2021 secondaries transaction value was split almost equally between Fund secondaries and Direct secondaries, but the Fund secondaries segment saw increased growth in the year (+150% vs Direct +116%). Our positioning During the year, we expanded our Secondaries programme, in line with our strategic objective of increasing exposure to this market segment. Secondary Investments represented 17.9% of the Portfolio at 31 January 2022, within our target range of 15 – 25%. RISING INTEREST RATES Trends 2021 saw a rebound in economic activity, delivering the strongest rate of global growth in almost half a century along with broadening concerns of rising inflation. Through the end of 2021 and into 2022, long-term government bond yields increased in the US and Europe, supported by hawkish signalling from the Fed, the BoE, and the ECB. Since the beginning of 2022, we have seen increasing expectation of interest rate hikes from many central banks. Our positioning We seek to invest in businesses that demonstrate strong defensive growth characteristics. We believe this enables us to deliver attractive returns to our shareholders, benefiting from the performance of companies that we believe will be more resilient to the impact of slower growth or challenging macro-economic conditions. We and our managers finance our businesses in ways that are designed to withstand economic volatility, for example through prudent use of leverage. 1 Bain Global Private Equity Report 2022: www.bain.com/globalassets/noindex/2022/bain_report_global-private-equity-report-2022.pdf 2 Setter Capital Volume Report 2021: www.settercapital.com/media/reports/Setter_Capital_Volume_Report_FY_2021.pdf ICG Enterprise Trust Plc Annual Report and Accounts 2022 13 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONManager’s review continued Our investment strategy We aim to deliver attractive risk-adjusted returns by executing our focused and differentiated investment strategy. We focus on investing in buyouts of businesses that are profitable, cash generative and have defensive growth characteristics that we believe will deliver strong and resilient returns across all economic cycles. Geographically we focus on the developed markets of North America, Europe and the UK, which have deep and mature private equity markets. We find these characteristics in a range of companies, reflected in the diversified sectors in which our Portfolio is invested. There are a number of themes that contribute to a business having, in our view, defensive growth characteristics. These include (among others) attractive market positioning, providing mission-critical services to their clients and customers, ability to pass on price increases, and structurally high margins. We invest in businesses directly, through ICG-managed funds, and through third party private equity managers. When combined, we believe this results in a unique and balanced portfolio with attractive growth characteristics. DEFENSIVE GROWTH COMPANIES Leading private equity managers With track records of investing and adding value through cycles. Mid-market and larger deals More likely to be resilient to economic cycles and typically attract stronger management teams than smaller companies. Developed markets Primarily in Europe and the US which have more established private equity sectors and more experienced managers. Buyouts More consistent returns with lower risk than other private equity strategies. All private equity Performance overview CONTINUING OUR TRACK RECORD OF GROWTH Despite businesses worldwide facing ongoing challenges due to sustained impact from the COVID-19 pandemic, rising inflation, and concerns around potential interest rate rises, we continued to deliver strong NAV growth, generating NAV per share Total Return of 24.4% and ending the year with a NAV per Share of 1,690p. At 31 January 2022, our Portfolio was valued at £1,172.2m, reflecting a 29.4% Portfolio Return on a Local Currency Basis (FY21: 24.9%). Our Portfolio growth represents strong performance across all areas of our investment strategy. Investment category ICG-managed investments Third Party Direct Investments Third Party Secondary Investments High Conviction Investments Third Party Funds Portfolio Portfolio by investment type High Conviction Investments Our growth this year extends the track record of strong performance that we have delivered for our shareholders. Over the last five years, our Portfolio has generated an annualised Portfolio Return on a Local Currency Basis of 20.4% and FY22 is the 13th consecutive year that we have delivered a double-digit Portfolio Return on a Local Currency Basis. ICG investments Third Party Primary Funds Third Party Secondary Investments Third Party Direct Investments 27% 51% 6% 16% 31 January 2022 £m 31 January 2022 % of Portfolio 31 January 2021 % of Portfolio 315 190 68 573 599 1,172 27% 16% 6% 49% 51% 100% 23% 21% 7% 51% 49% 100% 14 ICG Enterprise Trust Plc Annual Report and Accounts 2022 BROAD-BASED GROWTH ACROSS HIGH CONVICTION INVESTMENTS AND THIRD PARTY FUNDS The benefits of our approach to portfolio construction are demonstrated by our long-term track record. Over the last five years, our High Conviction Investments have generated an annualised Portfolio Return on a Local Currency Basis of 23.9% p.a. and our Third Party Fund investments have generated an annualised Portfolio Return on a Local Currency Basis of 17.8% p.a. High Conviction Investments represented 48.9% of the Portfolio value at 31 January 2022 (31 January 2021: 50.7%). We anticipate that High Conviction Investments will continue to represent 50% – 60% of the Portfolio in the medium term. During the year High Conviction Investments generated a 23.1% Portfolio Return on a Local Currency Basis. Key contributors to the performance included IRI (a provider of mission-critical data and predictive analytics to consumer goods manufacturers) and Visma (a provider of business management software and outsourcing services). The Secondary Investments made during the year have already shown positive returns, benefitting from the performance of a mature portfolio of invested assets. Third Party Funds generated a 36.0% Portfolio Return on a Local Currency Basis for the year (FY21: 22.4%) and represented 51.1% of the Portfolio value at 31 January 2022 (31 January 2021: 49.3%). These returns were driven by the strong performance of a number of funds that we invest in, including those managed by Advent, Gridiron, CVC and Thomas H. Lee, as well as the realisation of U-POL. Movement in the Portfolio £m Opening Portfolio1 Total new investments Total Proceeds Net (proceeds)/investments Valuation movement2 Currency movement Closing Portfolio1 % Portfolio growth (local currency) % currency movement % Portfolio growth (sterling) Effect of cash drag Expenses and other income Co-investment Incentive Scheme Accrual Impact of share buybacks and dividend reinvestment NAV per Share Total Return 1 Refer to the Glossary on page 96 for reconciliation to the Portfolio balance. 2 98% of the Portfolio is valued using 31 January 2022 (or later) valuations (2021: 95%). Year ended 31 Jan 2022 £m Year ended 31 Jan 2021 £m 949.2 303.7 (342.9) (39.2) 279.4 (17.2) 1,172.2 29.4% (1.8)% 27.6% (0.1)% (1.5)% (1.8)% 0.2% 24.4% 806.4 139.2 (209.2) (70.0) 200.6 12.2 949.2 24.9% 1.5% 26.4% 0.4% (1.9)% (2.8%) 0.4% 22.5% COLM WALSH Managing Director Reaching a landmark milestone This year, our NAV grew to £1.2bn for the first time, more than doubling since appointing ICG as our Manager six years ago. £1.2bn 2022 NAV £521m 2016 NAV ICG Enterprise Trust Plc Annual Report and Accounts 2022 15 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONManager’s review continued New investment activity EXECUTING ON AN ATTRACTIVE INVESTMENT PIPELINE During the period we were able to successfully execute on a number of attractive investments in our pipeline. In total during the year, we invested £303.7m, of which £185.6m (61.1%) was in High Conviction Investments and £118.1m were primary Drawdowns from Third Party Funds. Within the £185.6m of High Conviction Investments, £108.7m was invested alongside ICG and £76.9m was deployed through Third Party managers. Fund investments represented £100.5m of High Conviction Investments, with £85.1m invested across 21 individually- selected Co-investments. 10 of these Co-investments represent new investments for ICG Enterprise Trust, and 11 were follow-on investments (totalling £5.1m) to companies already held in our Portfolio. Of the 10 new investments, four were alongside ICG and six were alongside Third Party managers. The ten new Co-investments were: NEW COMMITMENTS During the year we made a total of £189.9m of new Commitments to funds, of which £117.3m was to ICG-managed funds and £72.6m were to Third Party Funds. ICG-managed funds During the period we committed £117.3m to four ICG-managed funds, including to three funds that focus on Secondary transactions. The breakdown of Commitments made to ICG-managed funds were: Third Party Funds During the year we committed £72.6m to Third Party Funds including Commitments made to new funds and Commitments inherited as part of fund positions acquired in the secondary market. We sought to identify leading managers who complement our long-term strategic objectives, are committed to values aligned to our Responsible Investing framework and have an investment approach that suits our defensive growth focus. In the period we made combined Commitments of £69.3m into seven new Third Party Funds, four of which were to managers with whom we have not invested before, demonstrating our continued ability to originate and execute new opportunities to work with leading managers. The breakdown of Commitments made to new Third Party Funds were: Company Manager Company sector/description Investment during the period Ambassador Theatre Group DomusVi ICG ICG Planet Payment Eurazeo/Advent Operator of theatres and ticketing platforms Operator of retirement homes Provider of integrated payments services focused on hospitality and luxury retail Ivanti Charlesbank Provider of enterprise IT software Davies Group BC Partners Brooks Automation Thomas H. Lee Class Valuation Gridiron European Camping Group PAI DigiCert ICG Provider of business process outsourcing services to the insurance sector Provider of semiconductor manufacturing solutions Provider of residential mortgage appraisal management services Operator of premium campsites and holiday parks Provider of enterprise internet security solutions AMEOS Group ICG Operator of private hospitals £11.4m £11.2m £9.6m £8.8m £8.7m £7.7m £6.9m £6.9m £6.7m £4.2m Fund Focus ICG Ludgate Hill I Secondary portfolio of mid-market and large buyouts ICG Europe Fund VIII Mezzanine and equity in mid-market buyouts ICG Strategic Equity Fund IV ICG Ludgate Hill II Secondary fund restructurings Secondary portfolio of mid-market and large buyouts Fund Focus Commitment during the period €45.0m (£38.7m) €40m (£34.8m) $40m (£28.8m) $20m (£15.0m) Commitment during the period Thomas H. Lee IX North American mid-market and large buyouts $20m (£14.1m) BC Partners XI European and North American mid-market buyouts €15m (£12.8m) Resolute V North American mid-market buyouts Bregal Unternehmerkapital III1 European mid-market buyouts $15m (£10.9m) €10m (£8.6m) GHO Capital III1 European and North American mid-market buyouts €10m (£8.6m) GI Partners VI1 North American mid-market buyouts Hellman and Friedman X1 North American mid-market and large buyouts $10m (£7.2m) $10m (£7.1m) 1 New manager relationship during the period. 16 ICG Enterprise Trust Plc Annual Report and Accounts 2022 TOP 30 COMPANIES REPORT ANOTHER PERIOD OF DOUBLE-DIGIT REVENUE AND EARNINGS GROWTH Our largest 30 underlying companies (‘Top 30 companies’) represented 39.0% of the Portfolio by value at 31 January 2022 (31 January 2021: 51.8%). There were 13 new entrants to our Top 30 companies within the period. Three of these were existing holdings in the Portfolio, whilst 10 were new investments made during the period. The geographic exposure of the Top 30 companies reflects our broader focus on developed private markets: 50.1% of the Top 30 by Portfolio value is invested in the US, 24.0% in Europe, with the remainder in the UK and the rest of the world. The Top 30 companies delivered impressive operational performance during the year, generating LTM revenue growth of 27.1% and LTM EBITDA growth of 29.6%.1,2 Of the Top 30 companies, EBITDA is a relevant valuation metric for 273, which in aggregate represent 33.0% of the Portfolio by value. At 31 January 2022, based on the valuation information provided by the underlying managers, the average Enterprise Value / EBITDA of these companies was 14.6x (31 January 2021: 14.0x). The Net Debt / EBITDA ratio of the same companies was 4.3x (31 January 2021: 4.3x). Realisation activity STRONG REALISATION ACTIVITY REFLECTS HIGH DEMAND FOR QUALITY ASSETS FY22 represented a strong year of Realisation activity for ICG Enterprise Trust, with Total Proceeds for the period of £342.9m, comprised of £333.5m of realisations from individual companies (either held directly or through funds) and £9.4m of proceeds from Fund Disposals. This was the highest level of Realisation Proceeds in the last five years and represents 35.1% of FY21 closing Portfolio value (as at 31 January 2021). 1 Weighted-averages, based on contribution to Portfolio value at 31 January 2022. 2 EBITDA growth rate excludes Ambassador Theatre Group (#19) and European Camping Group (#25), for which prior year EBITDA was negative (due to COVID-19 impacts). 3 PetSmart/Chewy, Olaplex and MoMo were excluded from this analysis as EBITDA growth is not a relevant metric for these companies in the period. Our exit from Telos — a leading provider of cyber, cloud and enterprise security solutions for the world’s most security-conscious organizations — reflected a 33.0x return on invested capital. There were 54 Full Exits of Portfolio holdings during the period, generating proceeds of £210.5m. Full Exits were completed at an average Multiple to Cost of 2.6x, and an average Uplift to Carrying Value of 36.3%. Partial exits generated Realisation Proceeds of £123.0m. Four of our Top 30 companies at the beginning of the financial year were fully realised during the period. The largest exit was Telos, the second largest investment at the start of the financial year, which we fully realised early in the period. This exit, completed at a slight uplift to the 31 January 2021 carrying value, was a sale of shares in the quoted business following Telos’ IPO in 2020, and generated a 33.0x return on invested capital. In September 2021, Graphite Capital completed the trade sale of U-POL (previously ranked third in our Top 30 holdings), to US-listed Axalta Coating Systems. This transaction generated proceeds of £22.9m, representing a 4.5x return on invested capital. Other notable Realisations included the exit of Supporting Education Group, an ICG investment, which was the 10th largest underlying portfolio company at the start of the year, and Cognito, an investment alongside Graphite Capital. ICG Enterprise Trust Plc Annual Report and Accounts 2022 17 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONQUOTED COMPANIES We do not actively invest in publicly-quoted companies, but gain listed investment exposure when IPOs are used as a route to exit an investment. In these cases, exit timing typically lies with the third party manager alongside whom we have invested. During the financial year, 17 portfolio companies were publicly listed. The listings generated a combined gross valuation uplift for the Company of £17.1m compared to their valuation at 31 January 2021. At 31 January 2022, we had 45 underlying investments in quoted companies, representing 10.3% of the Portfolio value (31 January 2021: 20.4%). The reduction in listed exposure was largely driven by the Full Exit of Telos during February (4.6% of our Portfolio value at 31 January 2021) and the 53.2% decline in Chewy’s share price during the financial year. Despite Chewy’s share price performance this year, ICG Enterprise Trust’s investment in PetSmart (which includes Chewy) has delivered a strong return on investment for our shareholders. At 31 January 2022 there were two quoted investments that individually accounted for 0.5% or more of the Portfolio value (see table below). Company Chewy (part of PetSmart)1 Olaplex2 Other Ticker CHWY-US OLPX-US 1 2 Total % value of Portfolio 4.6% 0.6% 5.1% 10.3% % value of Portfolio includes entire holding of PetSmart and Chewy. Majority of value is within Chewy. 1 2 Company listed during the period. Manager’s review continued Portfolio analysis PORTFOLIO COMPOSITION OVERVIEW The Portfolio is actively managed and structured to strike a balance between both concentration – so that Direct Investments can meaningfully impact performance – and diversification, so that we are not overly exposed to the risks of individual portfolio companies or sectors. We also seek to ensure appropriate diversification by sector and by geography in the Portfolio. The Top 30 underlying investments in the Portfolio represented 39.0% of the Portfolio value at 31 January 2022. Within the Top 30 holdings, 27 were High Conviction Investments. FOCUS ON DEVELOPED MARKETS The Portfolio is focused on developed private equity markets, invested across the US (41.4%), continental Europe (32.1%) and the UK (18.6%). FOCUS ON SECTORS WITH DEFENSIVE GROWTH CHARACTERISTICS The Portfolio is well diversified and weighted towards sectors with defensive growth characteristics. Technology (24.1%), Healthcare (16.6%), Business Services (11.0%) and Education (5.1%) make up 56.8% of the Portfolio. We feel these are particularly attractive sectors, benefitting from structural growth trends. Within our exposure to the Consumer and Industrial sectors (20.8% and 8.3% respectively), we have a bias to companies with more defensive business models, non-cyclical growth drivers and high recurring revenue streams. We have relatively low exposure to the Financials and Leisure sectors (5.5% and 3.9% respectively). EXPOSURE TO RUSSIA AND UKRAINE Our Portfolio has no material exposure to Russia or Ukraine. We continue to monitor the situation closely and remain alert to potential direct or indirect implications. 18 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Balance sheet and financing Activity since the period end At 31 January 2022 we had a cash balance of £41.3m (31 January 2021: £45.1m) and total available liquidity of £208.4m. Activity between 1 February 2022 and 31 March 2022 has included: Cash at 31 January 2021 Realisation Proceeds Fund Disposals Third Party Fund Drawdowns High Conviction Investments Shareholder returns FX and other Cash at 31 January 2022 Available undrawn debt facilities Cash and undrawn debt facilities (total available liquidity) £m 45 334 9 (118) (186) (21) (23) 41 167 208 At 31 January 2022 the Portfolio represented 101.2% of net assets (31 January 2021: 100%). • Realisation Proceeds of £92m • New Investments of £70m (52% into High Conviction Investments) • Three new Fund Commitments totalling £79m Effective as at 3 May 2022, we have increased the size of our Revolving Credit Facility (‘RCF’) to €240m (from €200m previously), in keeping with the Company’s higher net asset value. We have also extended the maturity by one year to February 2026. The other key terms remain unchanged. The RCF is available for general corporate purposes, including short-term financing of investments such as the Drawdown on Commitments to funds. 31 January 2022 £m 31 January 2021 £m Outlook Portfolio1 Cash Co-investment Incentive Scheme Accrual2 Other Net Liabilities1,2 Net assets 1,172 41 (49) (7) 1,158 949 45 (42) 0 952 1 Refer to the Glossary for reconciliation from the Investments at fair value presented on the balance sheet to the Portfolio balance and calculation of Other Net Liabilities. 2 31 January 2021 value impacted by rounding (Co-investment Incentive Scheme Accrual: £(41.8)m; Other Net Liabilities £(0.7)m). At 31 January 2022, we had Undrawn Commitments of £418.6m (31 January 2021: £418.5m) of which 22.9% (£95.8m) were to funds outside of their Investment Period. 31 January 2022 £m 31 January 2021 £m Undrawn Commitments – funds in Investment Period Undrawn Commitments – funds outside Investment Period Total Undrawn Commitments Total available liquidity (including facility) Overcommitment (including facility) Overcommitment % of Net Asset Value 323 96 419 (208) 211 18% 341 77 418 (201) 217 23% Our objective is to be fully invested through the cycle, while ensuring that we have sufficient liquidity to be able to take advantage of attractive investment opportunities as they arise. We do not intend to be geared other than for short-term working capital purposes. We believe that the private equity model of active ownership is well positioned to generate long-term value and to withstand market volatility and economic uncertainty. Calendar year 2022 is expected to see a large number of experienced private equity managers raising capital for new funds. This is creating attractive opportunities for ICG Enterprise Trust, with favourable supply/demand dynamics enabling us to selectively commit to funds managed by top-tier managers. We remain focused on disciplined Deployment into attractive Co-investment opportunities, and to further growing our secondaries programme. In line with our investment strategy, our Portfolio is invested into companies exhibiting characteristics of defensive growth, including strong cash flow generation, high margins, market leading positions in sectors with high barriers to entry, and strong ability to pass on cost increases. We believe that these attributes are likely to make them resilient investments, even in an inflationary and rising interest rate environment. We believe that this positions us well to continue to deliver attractive returns and to create value for our shareholders through FY23 and beyond. ICG Private Equity Fund Investments Team 11 May 2022 ICG Enterprise Trust Plc Annual Report and Accounts 2022 19 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION30 largest underlying companies Our Top 30 companies by value make up 39.0% of the Portfolio £303.7m Total New Investment1 £342.9m Total Proceeds1 Our Portfolio1 combines investments managed by ICG and those managed by third parties, in both cases directly and through funds. High Conviction Investments represented 49% of the Portfolio value (31 January 2021: 51%) and we anticipate these investments will represent 50%– 60% of the Portfolio in the medium term. Our High Conviction Investments, which include 27 of our Top 30 companies, allow us to proactively increase exposure to companies that benefit from long-term structural trends and therefore have the ability to grow even in less benign economic environments. We are able to enhance returns and increase visibility on underlying performance drivers, and we mitigate the more concentrated risk through a highly selective approach and a focus on defensive growth companies. Over the last five years, this element of the Portfolio has generated a local currency return of 23.9% p.a. Top 30 sector exposure2 (%) Top 30 by investment type2 (%) 1 This is an APM as defined in the Glossary on page 96. 2 By portfolio company value. 20 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Consumer goods and services Business servicesTMTHealthcareEducationIndustrials Leisure23%22%22%13%9%5%6%High Conviction Investments Third Party Funds92%8%Companies entering the Top 30 Name Value as % of Portfolio Investment type Sector Manager Ambassador Theatre Group 0.8% High Conviction Investment Consumer goods & services AMEOS Group Brooks Automation Class Valuation Davies Group DigiCert European Camping Group Ivanti 0.6% 0.7% 0.7% 0.8% 1.3% 0.7% 1.1% ICG ICG High Conviction Investment Healthcare High Conviction Investment Information technology Thomas H. Lee High Conviction Investment Financials Gridiron Capital High Conviction Investment Information technology BC Partners High Conviction Investment Information technology High Conviction Investment Consumer goods & services ICG PAI High Conviction Investment Information technology Charlesbank/ICG MoMo Online Mobile Services 0.7% High Conviction Investment Information technology ICG Olaplex Planet Payment Precisely WCT 0.6% 0.9% 0.9% 0.6% Primary Fund Healthcare Advent High Conviction Investment Technology, media & telecom Eurazeo/Advent High Conviction Investment Information technology ICG High Conviction Investment Healthcare The Jordan Company Companies leaving the Top 30 Name Allegro Reason Investment type Sector Manager Partial realisation Third Party Fund Consumer goods & services Cinven/Permira Berlin Packaging Partial realisation High Conviction Investment Business services Oak Hill Capital Partners Cognito Realisation High Conviction Investment Technology, media & telecom Graphite Capital Compass Community Valuation Third Party Fund Healthcare Graphite Capital Dr. Martens EG Group IRIS Partial realisation Third Party Fund Consumer goods & services Permira Valuation Valuation Third Party Fund Consumer goods & services TDR Capital High Conviction Investment Technology, media & telecom ICG Springer Nature Partial realisation High Conviction Investment Consumer goods & services BC Partners Supporting Education Group Partial realisation High Conviction Investment Education ICG System One Telos U-POL YSC Consulting Realisation Realisation Realisation Valuation High Conviction Investment Business services Thomas H. Lee High Conviction Investment Technology, media & telecom Direct High Conviction Investment Consumer goods & services Graphite Capital Third Party Fund Business services Graphite Capital ICG Enterprise Trust Plc Annual Report and Accounts 2022 21 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION30 largest underlying companies continued 1. PETSMART/CHEWY 2. MINIMAX 3. IRI 4. YUDO Retailer of pet products and services. Supplier of fire protection systems and services. Provider of mission-critical data and predictive analytics to consumer goods manufacturers. Designer and manufacturer of hot runner systems. Value as % of Portfolio 4.6% Value as % of Portfolio 2.7% Value as % of Portfolio 2.7% Value as % of Portfolio 2.2% Manager Invested Country Sector BC Partners 2015 USA Consumer goods & services Manager ICG Invested 2018 Country Germany Sector Technology, media & telecom Manager New Mountain Capital Invested 2018 Country USA Sector Technology, media & telecom Manager Invested Country Sector ICG 2017 South Korea Industrials 9. VISMA 10. DAVID LLOYD LEISURE 11. DOMUSVI 12. DIGICERT Provider of business management software and outsourcing services. Operator of premium health clubs. Operator of retirement homes. Provider of enterprise internet security solutions. Value as % of Portfolio 1.4% Value as % of Portfolio 1.3% Value as % of Portfolio 1.3% Value as % of Portfolio 1.3% Manager Hg Capital/ICG Invested 2017/2020 Country Norway Sector Technology, media & telecom Manager Invested Country Sector TDR Capital 2013/2020 UK Leisure Manager Invested Country Sector ICG 2021 France Healthcare Manager Invested Country Sector ICG 2021 USA Information technology 17. PRECISELY 18. PLANET PAYMENT 19. AMBASSADOR THEATRE GROUP 20. DAVIES GROUP Provider of enterprise software. Provider of integrated payments services focused on hospitality and luxury retail. Operator of theatres and ticketing platforms. Provider of business process outsourcing services to the insurance sector. Value as % of Portfolio 0.9% Value as % of Portfolio 0.9% Value as % of Portfolio 0.8% Value as % of Portfolio 0.8% Manager Invested Country Sector ICG 2021 USA Information technology Manager Eurazeo/Advent Invested 2021 Country Ireland Sector Technology, media & telecom Manager Invested Country Sector ICG 2021 UK Consumer goods & services Manager Invested Country Sector BC Partners 2021 UK Information technology 25.EUROPEAN CAMPING GROUP 26. BROOKS AUTOMATION 27. OLAPLEX 28. AMEOS GROUP Operator of premium campsites and holiday parks. Provider of semiconductor manufacturing solutions. Provider of hair care products. Operator of private hospitals. Value as % of Portfolio 0.7% Value as % of Portfolio 0.7% Value as % of Portfolio 0.6% Value as % of Portfolio 0.6% Manager Invested Country Sector PAI 2021 France Consumer goods & services Manager Invested Country Sector Thomas H. Lee 2022 USA Information technology Manager Invested Country Sector Advent 2020 USA Healthcare Manager Invested Country Sector ICG 2021 Switzerland Healthcare 22 ICG Enterprise Trust Plc Annual Report and Accounts 2022  5. LEAF HOME SOLUTIONS 6. DOC GENERICI 7. ENDEAVOR SCHOOLS 8. FRONERI Provider of home maintenance services. Manufacturer of generic pharmaceutical products. Provider of private schooling. Manufacturer and distributor of ice cream products. Value as % of Portfolio 2.0% Value as % of Portfolio 1.7% Value as % of Portfolio 1.7% Value as % of Portfolio 1.6% Manager Invested Country Sector Gridiron Capital 2016 USA Consumer goods & services Manager Invested Country Sector ICG 2019 Italy Healthcare Manager Invested Country Sector Leeds Equity 2018 USA Education Manager Invested Country Sector PAI 2019 UK Consumer goods & services 13. AML RIGHTSOURCE 14. IVANTI 15. PSB ACADEMY 16. CURIUM PHARMA Provider of compliance and regulatory services and solutions. Provider of IT management solutions. Provider of private tertiary education. Supplier of nuclear medicine diagnostic pharmaceuticals. Value as % of Portfolio 1.2% Value as % of Portfolio 1.1% Value as % of Portfolio 1.1% Value as % of Portfolio Manager Invested Country Sector Gridiron Capital 2020 USA Business services Manager Invested Country Sector Charlesbank/ICG 2021 USA Information technology Manager Invested Country Sector ICG 2018 Singapore Education Manager Invested Country Sector 1.0% ICG 2020 UK Healthcare 21. CLASS VALUATION 22. REG-ED 23. CRUCIAL LEARNING 24. MOMO ONLINE MOBILE SERVICES Provider of residential mortgage appraisal management services. Provider of SaaS-based governance, risk and compliance enterprise software solutions. Provider of corporate training courses focused on communication skills and leadership development. Operator of remittance and payment services via mobile e-wallet. Value as % of Portfolio 0.7% Value as % of Portfolio 0.7% Value as % of Portfolio 0.7% Value as % of Portfolio 0.7% Manager Invested Country Sector Gridiron Capital 2021 USA Financials Manager Gryphon Invested 2018 Country USA Sector Technology, media & telecom Manager Invested Country Sector Leeds Equity 2019 USA Education Manager Invested Country Sector ICG 2019 Vietnam Information technology 29. NGAGE 30. WCT INVESTMENT TYPE Provider of recruitment services. Provider of clinical research outsourcing services. Primary Funds Secondary Investments Value as % of Portfolio 0.6% Value as % of Portfolio 0.6% Manager Invested Country Sector Graphite Capital 2014 UK Consumer goods & services Manager Invested Country Sector The Jordan Company 2021 USA Healthcare Direct Investments High Conviction Investments Third Party Funds ICG Enterprise Trust Plc Annual Report and Accounts 2022 23 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Investing responsibly Responsible investing is integrated into our strategy The long-term success of ICG Enterprise Trust requires effective management of both financial and non-financial measures. Environmental, social and governance (‘ESG’) issues can be an important driver of investment value, as well as a source of risk. ICG has had a long-standing commitment to responsible investing, and operates a well-defined, firm-wide Responsible Investing Policy and ESG framework. Within ICG Enterprise Trust, we take a tailored ESG approach across all stages of our investment process. Our focus is on partnering with managers who share a similar approach to responsible investing. PRE-INVESTMENT We have a well-established ESG screening and diligence process for all new fund investments and direct investments. During the past year, we have increased our focus on climate-related risks and opportunities in line with our climate commitments and risk assessment processes. We incorporate ESG considerations throughout our investment process to generate long-term, sustainable returns. Our responsible investment strategy is defined by three key priorities: We have a greater ability to assess ESG considerations in our High Conviction Investments given we have clearer visibility of the underlying companies when making an investment decision. We operate an Exclusion List to ensure we do not make direct investments in companies considered incompatible with our corporate values. Thereafter our ESG diligence is tailored based on the nature of the company. We consider risks associated with its sector and geography, along with environmental (including climate change), social, corporate governance and ethical concerns. For Third Party Funds, given we do not directly influence a manager’s portfolio construction, we seek to partner with managers who share a similar approach to responsible investing. We use our focused ESG Questionnaire to help us to assess the manager’s ESG approach and capabilities. In 2021, we added new indicators to understand the manager’s preparedness for upcoming ESG-related regulatory and reporting changes. The results of our ESG diligence are formally presented to our Investment Committee and used to underpin the investment case. Go online to read more ICG’s Responsible Investing Policy is available @ www.icgam.com Incorporate ESG factors into investment decision making Partner with managers who share a similar approach to responsible investing Better identify ESG risks 24 ICG Enterprise Trust Plc Annual Report and Accounts 2022 EXAMPLE CONSIDERATIONS IN OUR ESG QUESTIONNAIRE: • Is the manager a PRI signatory, or has it adopted any other ESG standards or frameworks? • How does the manager monitor ESG performance across its portfolio companies? • Are climate change considerations integrated into its investment policy? • What classification will the fund take per the Sustainable Finance Disclosure Regulation, and what reporting will be provided to LPs? POST INVESTMENT ESG performance is embedded in our monitoring process for both funds and Direct Investments. During the past year, we have enhanced our monitoring of ESG-related metrics across the Portfolio, for example managers’ commitments to international standards and monitoring of climate-related risks. We have strong relationships with managers across our Portfolio and maintain active engagement to identify and mitigate any potential ESG risks. We also use tools such as RepRisk to monitor ESG incidents across underlying portfolio companies. Our approach to ESG integration The ICG Enterprise Trust investment team receives formal training on ESG and is provided with the skills and tools necessary to identify and investigate ESG issues throughout the investment process. Looking forward, we think ESG will remain at the forefront of investors’ priorities. ICG Enterprise Trust will continue to focus on investing in line with our corporate values and partnering with managers who share a similar approach to ESG. DEAL SCREENING PRE-INVESTMENT PORTFOLIO MONITORING • Exclusion List • ESG Screening Checklist (including climate risk assessment) • RepRisk screening • Third Party Funds ESG Questionnaire • Discussions with manager • Diligence findings included in all investment proposals • ESG performance embedded in monitoring process • Regular dialogue with managers • Manager’s ESG reporting • Training for investment team Across all managers we made commitments to in FY22 100% Operate an ESG Policy 100% Have an ESG monitoring process in place 89% Are signatories of the UN’s Principles for Responsible Investment ESG diligence: investment process We think the best opportunity to understand an investment’s ESG risks and opportunities is during the pre-investment phase. Here are two recent examples of how ESG considerations have been integrated into our diligence process, and the ultimate impact on our investment decision. Opportunity to co-invest in a manufacturer of bottle closures for the beverage industry Opportunity to co-invest in Brooks Automation, a provider of manufacturing automation solutions to the semiconductor market Investment thesis: strong market position with high barriers to entry, a diverse customer base and a track record of M&A. Investment thesis: leading position in a growing market, mission critical offering and long-standing customer relationships. Key ESG considerations: exposure to plastic packaging industry and associated environmental impacts as well as risk of regulatory changes relating to the sustainability of plastic packaging. Investment decision: the opportunity was declined. Key ESG considerations: potential social and labour risks associated with its global supply chain. Third-party ESG diligence found that the company evaluates all suppliers prior to engagement, its service agreements include social and environmental standards, and suppliers are further bound by a number of regulatory standards. Investment decision: the investment was approved. ICG Enterprise Trust Plc Annual Report and Accounts 2022 25 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION People and culture A dedicated, experienced investment team The Manager is committed to colleague engagement, well-being and the highest levels of personal development. 50% Of the investment team are female 100+ Years of combined industry experience Diversity and inclusion Developing future leaders CREATING THE RIGHT ENVIRONMENT The Manager’s vision is to provide an inclusive and respectful environment in which each individual is motivated to make their fullest contribution; in which they feel fairly recognised, rewarded and included regardless of age, gender, race, sexual orientation, disability, religion or beliefs. DIVERSITY AND INCLUSION STRATEGY The Manager has developed a diversity and inclusion strategy with the aim of increasing diversity and creating an inclusive workplace. TRAINING AND SUPPORT The Manager considers that training and development are essential to attract and retain people of the highest calibre and invests significantly in this area. EFFECTIVE CAREER COACHING Through its performance management system and by actively encouraging managers to deliver effective career coaching and provide tailored training opportunities, the Manager is able to develop and enhance core skills, increase technical competency, and develop and nurture talent. 26 ICG Enterprise Trust Plc Annual Report and Accounts 2022 6 Individuals make up the investment team 7 Individuals make up the ICG oversight and support team Culture and values The Manager’s culture centres around long-term relationships with a wide range of stakeholders; sustainable investment excellence; and a world- class team demonstrating integrity, diversity and collaboration. 24 Investing responsibly 34 Stakeholder engagement www.icgam.com Our Manager is a global alternative asset manager, providing the capital to help businesses grow. Oversight by ICG Enterprise Trust The Board of ICG Enterprise Trust ensures that it reviews the Manager’s culture as expressed on these pages. This is monitored through our regular interaction and discussions with the Manager and the Management Engagement Committee also undertakes a formal review. 38 How we manage risk 46 Board of Directors ICG Enterprise Trust Plc Annual Report and Accounts 2022 27 Performance for our clientsEntrepreneurialism and innovationAmbition and focusWorking collaboratively and acting with integrityTaking responsibility and managing riskOUR MANAGER’S CULTURE AND VALUESSTRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONPeople and culture continued 28 ICG Enterprise Trust Plc Annual Report and Accounts 2022 ROLE OF INVESTMENT COMMITTEE The Investment Committee is responsible for the approval of all new investments and the overall management of the Portfolio, including any secondary sales. The Committee includes senior members of the investment team and senior leadership from ICG, ensuring a broad perspective on the private equity landscape and relative value and risk. Member of the Investment Committee 20+ Years average private equity experience for Investment Committee members The investment team The Portfolio is managed by a dedicated investment team within ICG, who have a strong combination of direct and fund investment experience. 1. OLIVER GARDEY 2. COLM WALSH 3. LIZA LEE MARCHAL Head of Private Equity Fund Investments Managing Director Principal 25+ years Private equity experience 17 years Private equity experience 16 years Private equity experience Background Liza joined the team in 2019. She was previously with GIC Private Equity for 11 years, first in the London office and most recently in the Singapore office. During her time at GIC, Liza worked in both the Direct and Fund Investments teams. Prior to this, she worked in the private equity division of Henderson Global Investors and started her career in the corporate finance group at PricewaterhouseCoopers. Liza holds a degree in Biochemistry from Oxford University and an MBA from INSEAD. Background Oliver joined the team in 2019. He has over 25 years’ experience in the private equity industry. For the previous decade he was a partner at Pomona Capital where he was a member of the global investment committee. Prior to this, he was partner and an investment committee member at Adams Street, Rothschild/Five Arrows Capital and J.H. Whitney & Co. respectively. Oliver was previously CEO of Inflight Service Corp., a global leading aircraft galley equipment manufacturer, and instrumental in the buyout, the operational turnaround and the successful exit of the business. Oliver graduated magna cum laude from Brown University and received his MBA from Harvard Business School. Investment Committee role Oliver has overall responsibility for the execution of the Company’s investment strategy. He has extensive experience across the private equity market, as a direct, secondary and fund investor. Background Colm joined the team in 2010. He focuses on primary funds, direct investments and secondary transactions and over the last five years has been responsible for building up the US investment programme. He previously worked at Terra Firma in its finance and structuring team and at Deloitte where his clients included a number of private equity firms. Colm is a graduate of Economics from the London School of Economics. He is both a Chartered Accountant and a CFA Charterholder. Colm volunteers for Level20, mentoring a group of five UK-based female professionals starting their careers in private equity. Investment Committee role Colm brings experience of both fund and direct investments in Europe and the US to the Investment Committee. He has a broad range of relationships with both managers and investors in private equity which help provide insights on new opportunities. 4. KELLY TYNE 5. LILI JONES 6. CRAIG GRANT Vice President Vice President Associate 8 years Private equity experience 7 years Private equity experience 5 years Private equity experience Background Kelly joined the team in 2014 and has worked on a wide range of primary funds, secondaries and direct investments in Europe and the US. Prior to this, Kelly was an equity and fixed income research analyst at First NZ Capital (Credit Suisse, New Zealand) and spent three years in the consulting team at PricewaterhouseCoopers. Kelly is a graduate in Finance and Accounting from Otago University. Background Lili joined the team in 2019 from Ares Management where she worked in the Direct Lending Investment team on a range of private equity-backed transactions. Prior to this, she spent five years in the Corporate Finance Debt Advisory and Restructuring businesses at Deloitte. Lili is a Chartered Accountant and a graduate from Warwick University with a degree in MORSE (Maths, Operational Research, Statistics and Economics). Background Craig joined the team in 2017 and focuses on evaluating new investment opportunities. He has worked on a wide range of primary, secondary and co-investment opportunities across Europe and North America. Craig is a graduate of University College Dublin and holds an MSc in Finance from Trinity College Dublin. ICG Enterprise Trust Plc Annual Report and Accounts 2022 29 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION ANDREW HAWKINS Head of Private Equity Solutions, ICG plc Background Andrew is Head of ICG’s US business as well as Head of Private Equity Solutions, the division of ICG which includes both Strategic Equity and ICG Enterprise Trust Plc. Andrew is based in New York and also sits on the investment committee for ICG Strategic Equity. He was formerly Partner and Managing Partner at Palamon Capital Partners and Vision Capital Partners respectively. Most recently Andrew was CEO of NewGlobe Capital Partners, a business he founded in 2012. He has an LLB in Law from Bristol University and is a Chartered Accountant. ANDREW LEWIS General Counsel and Company Secretary, ICG plc Background Andrew joined ICG in 2013 and is responsible for ICG’s Legal, Company Secretarial and Compliance functions. Prior to this, he spent 11 years in legal practice with Slaughter and May and Ashurst LLP, specialising in public and private M&A, company law and corporate governance. He is qualified as a Solicitor in England and Wales and is a graduate of Oxford University. People and culture continued ICG plc oversight and support Broad-based oversight and support across all operational functions. BENOÎT DURTESTE Chief Investment Officer and Chief Executive Officer, ICG plc Background Benoît is Chief Investment Officer and Chief Executive Officer of ICG. He is also a member of the Board of ICG plc and the Chair of the BVCA Alternative Lending Working Group. Benoît joined ICG in 2002 from Swiss Re where he was a Managing Director in the Structured Finance division in London. Prior to Swiss Re, Benoît worked in the Leveraged Finance division of BNP Paribas and in GE Capital’s telecom and media private equity team in London. Benoît is a graduate of the Ecole Superieure de Commerce de Paris. CHRIS HUNT Head of Shareholder Relations, ICG plc Background Chris joined ICG in 2020 as a Managing Director and Head of Investor Relations. Prior to joining ICG, Chris spent 13 years as an investment banker with Deutsche Bank and latterly with Goldman Sachs. During this time he covered a variety of public and private companies, including a number of private equity firms, and advised across M&A, debt and equity capital markets. Chris is a graduate of the University of Cambridge. 30 ICG Enterprise Trust Plc Annual Report and Accounts 2022 VIKAS KARLEKAR ICG Enterprise Trust Chief Finance Officer and Head of Group Finance, ICG plc Background Vikas joined ICG in April 2020 as Group Head of Finance. Prior to joining ICG, Vikas spent 10 years at Barclays where he held a number of pan-finance leadership roles, and 13 years at UBS Investment Bank holding senior positions in the Product Control Finance department, both in the UK and the USA. Vikas graduated from the London School of Economics with a degree in Management Science, and is a Chartered Accountant. JULIAN WARE ICG Enterprise Trust Head of Finance, ICG plc Background Julian joined ICG in May 2021 as an Associate Director of Accounting Policy before assuming the role of ICG Enterprise Trust Head of Finance in November 2021. Prior to joining ICG, Julian spent 12 years as a Financial Controller at American Express, latterly spending six years as Director, Mergers & Acquisitions Controller. During this time he covered a variety of M&A transactions including strategic acquisitions and investments, divestitures and joint ventures. Julian is a Chartered Accountant. JESSICA MILLIGAN Accounting Policy and Reporting Strategy Director, ICG plc Background Jessica joined ICG in 2006 and has undertaken a number of roles within the corporate group, most recently as Group Head of Internal Audit prior to joining the Group Finance Team in 2021 as Head of Accounting Policy and Reporting Strategy. Prior to joining ICG, she spent five years with Andersen and Deloitte. Jessica is a graduate of Cambridge University and is a Chartered Accountant. ICG Enterprise Trust Plc Annual Report and Accounts 2022 31 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONKey performance indicators Focus on generating long-term growth for shareholders PORTFOLIO RETURN ON A LOCAL CURRENCY BASIS NAV PER SHARE TOTAL RETURN 29.4% 1 YEAR 3 YEARS 5 YEARS 24.4% 29.4% 1 YEAR 23.5% P.A. 20.4% P.A. 3 YEARS 5 YEARS 24.4% 19.2% P.A. 16.4% P.A. RATIONALE Portfolio Return on a Local Currency Basis measures the total movement in the underlying investment Portfolio valuation, without the influence of foreign exchange movements or the Co-investment Incentive Scheme Accrual. It is a measure of the performance of the underlying managers and the investment team’s selective investment approach and management of the Portfolio. PROGRESS IN THE YEAR The Portfolio generated a local currency return of 29.4% in the 12 months to 31 January 2022 (31 January 2021: 24.9%). A reconciliation of the performance can be found in the Glossary on page 96. RATIONALE NAV per Share Total Return is shown net of all costs associated with running the Company and includes the impact of any movement in foreign exchange on valuations. As it includes all of the components of the Company’s performance it reflects the attributable value of a shareholder’s investment in ICG Enterprise Trust Plc. PROGRESS IN THE YEAR The Company has continued to build on its strong performance, reporting NAV per Share Total Return of 24.4% in the 12 months to 31 January 2022 (31 January 2021: 22.5%). The FTSE All-Share Total Return was 18.9% over the same period (31 January 2021: -7.5%). EXAMPLES OF RELATED FACTORS THAT WE MONITOR • Monitoring of the Portfolio performance and watchlist EXAMPLES OF RELATED FACTORS THAT WE MONITOR • Performance relative to the wider public markets and in particular • Valuations provided by underlying managers • Performance of High Conviction Investments and Third Party Funds • Detailed analysis of the Top 30 companies’ performance, EBITDA and revenue growth, leverage, valuation multiples, performance against investment thesis and exit prospects • Overall EBITDA and revenue growth, leverage and valuation multiples of the Portfolio as reported by the underlying managers the FTSE All-Share Total Return • Performance relative to listed private equity peer group • Portfolio performance • Valuations provided by underlying managers • Impact of foreign exchange on valuations • Effect of financing (cash drag) on performance • Accretive impact of any share buybacks • Ongoing charges incurred, including management fees and expenses LINK TO STRATEGIC OBJECTIVE • Maximising long-term capital growth through a flexible mandate LINK TO STRATEGIC OBJECTIVE • Maximising long-term capital growth through a flexible mandate and highly selective approach and highly selective approach Rationale RISK MANAGEMENT The execution of the Company’s investment strategy is subject to risk and uncertainty. The Board and Manager have a comprehensive risk assessment process, regularly re-evaluating the impact and probability of each risk materialising and the financial or strategic impact of the risk. RISK APPETITE The Board acknowledges and recognises that in the normal course of business the Company is exposed to risk and that it is willing to accept a certain level of risk in managing the business to achieve its targeted returns. 32 ICG Enterprise Trust Plc Annual Report and Accounts 2022 The Company regularly reviews its KPIs to ensure that they are the most effective metrics for measuring the Company’s performance and monitoring progress in delivering against its strategic objectives. TOTAL SHAREHOLDER RETURN TOTAL DIVIDEND PER ORDINARY SHARE 27.1% 1 YEAR 3 YEARS 5 YEARS 27p 27.1% 2022 27p 16.3% P.A. 14.3% P.A. 2021 2020 24p 23p RATIONALE Measures performance in the delivery of shareholder value, after taking into account share price movements (capital growth) and any dividends paid in the period. The Share Price Total Return will differ from NAV per Share Total Return depending on the movement in the share price discount to NAV per share. RATIONALE The Board recognises a reliable source of income is important for shareholders, and in the absence of unforeseen circumstances the Board intends to grow the annual dividend progressively. PROGRESS IN THE YEAR The Company’s share price increased to 1,200p, which together with dividends of 26.0p paid in the year generated a total shareholder return of 27.1% in the 12 months to 31 January 2022 (31 January 2021: 2.8%). The FTSE All-Share Total Return was 18.9% over the same period (31 January 2021: -7.5%). PROGRESS IN THE YEAR The directors are proposing a final dividend of 9p, which, together with the interim dividends of 18p, will take total dividends for the year to 27p. This is a 12.5% increase on the prior year dividend of 24p and a 2.3% yield on the year-end share price of 1,200p. EXAMPLES OF RELATED FACTORS THAT WE MONITOR • Performance relative to the wider public markets and in particular EXAMPLES OF RELATED FACTORS THAT WE MONITOR • Distributable reserves the FTSE All-Share Total Return • Performance relative to listed private equity peer group • Level of discount in absolute terms and relative to the wider listed private equity peer group • Trading liquidity and demand for Company’s shares in conjunction with marketing activity • Cash balances • Proceeds received during the year • Investment pipeline and available financing • Forecast dividend cover LINK TO STRATEGIC OBJECTIVE • Maximising shareholder returns through long-term capital growth • Progressive annual dividend policy LINK TO STRATEGIC OBJECTIVE • The Board recognises that a reliable source of growing dividends is an important part of total shareholder return over both the short and longer terms As part of its risk management framework, the Board considers its risk appetite in relation to each of the identified principal risks and monitors this on an ongoing basis. Where a risk is approaching or is outside the tolerance set, the Board will consider the appropriateness of actions being taken to manage the risk. 38 How we manage risk 40 Principal risks and uncertainties ICG Enterprise Trust Plc Annual Report and Accounts 2022 33 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONStakeholder engagement Directors’ duties Under Section 172 of the Companies Act 2006, directors are required to act in good faith and in a way most likely to promote the success of the Company. In doing so, the directors must also have regard to the long-term consequences of their decisions, the interests of the Company’s various stakeholders, the impact of the Company’s activities on the community and the environment, and maintaining a reputation for high standards of business conduct and fair treatment between members of the Company. The Company and the Board are always mindful of their stakeholders as well as their broader responsibilities to their community and the environment when making key strategic decisions. JANE TUFNELL Chair 34 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Our key stakeholder groups OUR SHAREHOLDERS OUR INVESTMENT MANAGER OUR INVESTEE ENTITIES OUR LENDERS OTHER SERVICE PROVIDERS Incorporation into key decisions during the year Investment strategy: expanding the Secondaries programme PRIMARY STAKEHOLDER IMPACTED OTHER STAKEHOLDERS IMPACTED HOW THE BOARD’S DECISION MAKING INCORPORATED STAKEHOLDER CONSIDERATIONS The Board reviewed the investment landscape and felt that an expanded Secondaries programme targeting 15–25% of the Portfolio would be beneficial to ICG Enterprise Trust’s shareholders given both the financial characteristics of these transactions and the Manager’s team that would execute them. In assessing this proposal, the Board considered issues such as the return profile of the Company, liquidity and the Manager’s ability to successfully source and execute these transactions. For more information on our investment strategy: 2 At a glance Shareholder returns: buying back 250,000 shares PRIMARY STAKEHOLDER IMPACTED OTHER STAKEHOLDERS IMPACTED Not applicable. HOW THE BOARD’S DECISION MAKING INCORPORATED STAKEHOLDER CONSIDERATIONS In the Board’s view, the discount compared to peers was inconsistent with ICG Enterprise Trust’s performance. Having identified reasons for this anomaly, the Board considered it was in shareholders’ best interests to undertake this buyback. In reaching this decision, the Board consulted with the Manager and external advisers to understand the market dynamics of the Company’s shares at the time. For more information on shareholder returns of an ICG Enterprise Trust share: 32 Key performance indicators Governance: establishing a Management Engagement Committee OUTCOMES During the year, the Company committed to three funds that focus on secondary transactions, all alongside its Manager. On 31 January 2022, 17.9% of the Company’s Portfolio was in Secondaries transactions. OUTCOMES On 27 July 2021, the Company bought back 250,000 of its own shares at a price of 1,070p per share. PRIMARY STAKEHOLDER IMPACTED OTHER STAKEHOLDERS IMPACTED HOW THE BOARD’S DECISION MAKING INCORPORATED STAKEHOLDER CONSIDERATIONS The Board deems appropriate governance and oversight of the Manager and service providers as a fundamental part of its responsibilities. OUTCOMES The Board instituted a Management Engagement Committee, chaired by David Warnock. The Committee will review all service providers on both qualitative and quantitative metrics. The Board felt that it would be appropriate to form a Management Engagement Committee whose remit is to review, on an annual basis, all contracted service providers for the Trust, whether contracted directly by the Company or via the Manager. The Committee held its inaugural meeting on 26 April 2021 and a further meeting in September 2021. It has agreed to meet at least annually thereafter. For more information on governance: 48 Corporate governance report ICG Enterprise Trust Plc Annual Report and Accounts 2022 35 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONStakeholder engagement continued How we engage WHY THEY ARE A STAKEHOLDER Shareholders are enshrined in our purpose as key to the Company’s existence. They benefit from the economic returns of the Company, the form of those returns (capital and income), and the volatility of those returns. Our investment manager provides a range of services to the Company, including investing the shareholders’ capital. It also provides the Company with access to ICG investment products, network and broader expertise. The Company’s capital is helping our portfolio companies to grow. Our shareholders Our investment manager Our investee entities Our lenders Other service providers The Board determines that a liquidity facility is appropriate for ICG Enterprise Trust, and as such our lenders are important stakeholders in ensuring we can achieve optimum terms for such a facility. Our service providers ensure, amongst other things, smooth running of the Company’s operations and compliance with legal and ethical obligations. 36 ICG Enterprise Trust Plc Annual Report and Accounts 2022 HOW WE ENGAGE ACTIVITY IN THE YEAR LOOKING AHEAD We engage with our shareholders through a variety of channels, including our website, our disclosures to the market and the publication of quarterly factsheets and a full Annual Report. In addition to the Annual Report, we ran a structured programme of presentations to existing and potential institutional shareholders after the publication of the annual, interim and quarterly results. We also conduct general meetings, roadshows and update meetings with key shareholders and potential shareholders to ensure that our investment strategy and developments are clearly understood. We also held regular discussions with sell-side analysts and presented at industry conferences. We increased our focus on retail investors, including enhancing our digital marketing and presenting at conferences that were open to retail investors. Enhanced clarity and quality of shareholder communication in recent periods has, in the Board’s view, been beneficial to the market’s perception of ICG Enterprise Trust and we will continue to refine our messaging and our channels to market. In particular, retail investors are likely to be increasingly important to the listed private equity market, including as shareholders to ICG Enterprise Trust. We will therefore continue to focus on ensuring we communicate openly and clearly to this market. The Company exercises oversight of its Manager, through a series of formal and informal meetings throughout the year. The Board of the Company seeks to build relationships at a number of levels within ICG; as well as our key relationship with the investment team, we regularly engage with the Finance, Shareholder Relations and Legal and Compliance functions of ICG. Employees of the Manager have attended, and reported to, all of our Board and Audit Committee meetings; between meetings, there have been regular calls, planning meetings and ad hoc engagements on ongoing matters. Our investment manager is regularly launching new investment strategies and in the coming years the Board will carefully assess which of these opportunities may be appropriate for ICG Enterprise Trust to invest in. The Manager engages with the General Partners of our investee funds; the Board provides oversight and strategic direction for that engagement. The Manager has an ongoing dialogue with a wide range of existing and potential investees to ensure that relationships are maintained and new investment opportunities can be generated. Topics of regular discussion include investment performance, the pipeline of new opportunities and ESG factors. Where the relationship is closer – for example due to a long-term investment history or a direct co-investment alongside that General Partner – the discussions are more detailed and frequent. Employees of the Manager have engaged on a continual basis with the General Partners of funds we are invested in or are looking to invest in, and reported back to the Board on material developments. These interactions have been through both formal sessions (e.g. investor days) and informal discussions. The Manager, along with others in the investor community, requests our General Partners (‘GPs’) to continually drive and improve standards at investee entity level. This is often through direct board representation of GPs at entity level, and through other routes such as the setting of KPIs (including metrics linked to ESG factors) and regular reporting from the investee entity. Dispersion of performance amongst GPs continues to be high, and we seek to ensure we invest shareholders’ capital in the right opportunities. The Manager will continue to engage with GPs to ensure that they work closely and collaboratively with investee entities, and that target setting and reporting (including on ESG matters) is clear, regular and transparent. The Manager’s treasury team is the primary point of contact for our lenders on a day-to-day basis. The Manager, with direction from the Board, maintains regular dialogue with our core relationship banks to ensure they are kept informed of the Company’s performance and banking needs. The Manager interacted with our lenders as appropriate, updating them on the performance of the Company. The Manager notified the lenders of their intention to exercise the option to extend the facility by one year to February 2026. The Company’s revolving credit facility comes up for renewal in February 2026 and in due course the Board and the Manager will review options for renewing or extending that facility. Our other key service providers, such as the Company’s auditors, fund administration providers (the ‘Administrator’), the Depositary and the Registrar, are managed on a day-to-day basis by ICG on the Company’s behalf, with escalation to and oversight by the Board of the Company as needed. The Chairs of the Board and the Audit Committee also attend relationship meetings on occasion. ICG has conducted regular engagement meetings with the Administrator, Depositary and Registrar, while the Board has maintained a regular assessment of these arrangements including relationship meetings with those providers. Both ICG and the Chair of the Audit Committee have engaged regularly with Ernst & Young LLP to plan for the interim review and year end audit. To enhance the Board’s oversight of the Manager and service providers, the Board established a Management Engagement Committee to formally review all relationships on an annual basis. As the Company continues to grow, regulation increases and demands from all stakeholders intensify, the Board is mindful of the need to ensure service providers continue to offer high-quality service at an appropriate price point. ICG Enterprise Trust Plc Annual Report and Accounts 2022 37 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONHow we manage risk Identifying and evaluating the strategic, financial and operational impact of our key risks The execution of the Company’s investment strategy is subject to a variety of risks and uncertainties, and the Board and Manager have identified several principal risks to the Company’s business. As part of this process, the Board has put in place an ongoing process to identify, assess and monitor the principal and emerging risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity. PRINCIPAL RISKS AND UNCERTAINTIES The Company considers its principal risks (as well as several underlying risks comprising each principal risk) in four categories: Investment risks: the risk to performance resulting from ineffective or inappropriate investment selection, execution or monitoring. PRINCIPAL RISKS The Company’s principal risks are individual risks, or a combination of risks, that could threaten the Company’s business model, future performance, solvency or liquidity. During the year the Company included climate change as a principal risk (see page 41). External risks: the risk of failing to deliver the Company’s investment objective and strategic goals due to external factors beyond the Company’s control. Operational risks: the risk of loss resulting from inadequate or failed internal processes, people or systems and external event, including regulatory risk. Financial risks: the risks of adverse impact on the Company due to having insufficient resources to meet its obligations or counterparty failure and the impact any material movement in foreign exchange rates may have on underlying valuations. A comprehensive risk assessment process is undertaken regularly to re-evaluate the impact and probability of each risk materialising and the strategic, financial and operational impact of the risk. Where the residual risk is determined to be outside of appetite, appropriate action is taken. Further information on risk factors is set out within the financial statements. Details of the Company’s principal risks, potential impact, controls and mitigating factors are set out on pages 40 to 43. OTHER RISKS Other risks, including reputational risk, are potential outcomes of the principal risks materialising. These risks are actively managed and mitigated as part of the wider risk management framework of the Company and the Manager. EMERGING RISKS Emerging risks are considered by the Board as they come into view and are regularly assessed to identify any potential impact on the Company and to determine whether any actions are required. Emerging risks often include those related to regulatory/ legislative change and macro-economic and political change. The Company depends upon the experience, skill and reputation of the employees of the Manager. The Manager’s ability to retain the service of these individuals, who are not obligated to remain employed by the Manager, and recruit successfully, is a significant factor in the success of the Company. The Company’s risk exposure as a result of the impacts from the Russia-Ukraine conflict and the sanctions imposed on Russia after the reporting date have been reviewed and the Company has minimal direct exposure. The political and economic situation is being monitored. COVID-19 The continuation of the COVID-19 pandemic has given rise to challenges for businesses across the globe and during the year the Board maintained its focus on the impact of the crisis on the performance of the Company. The crisis management and business continuity protocols of the Manager remained effectively invoked and have provided a robust framework to support continuity. 38 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Low Risk tolerance High Risk appetite and tolerance The Board acknowledges and recognises that in the normal course of business, the Company is exposed to risk and that it is willing to accept a certain level of risk in managing the business to achieve its targeted returns. The Board’s risk appetite framework provides a basis for the ongoing monitoring of risks and enables dialogue with respect to the Company’s current and evolving risk profile, allowing strategic and financial decisions to be made on an informed basis. The Board considers several factors to determine its acceptance for each principal risk and categorises acceptance for each risk as low, moderate and high. Where a risk is approaching or is outside the tolerance set, the Board will consider the appropriateness of actions being taken to manage the risk. In particular, the Board has a lower tolerance for financing risk with the aim to ensure that even under a stress scenario, the Company is likely to meet its funding requirements and financial obligations. Similarly, the Board has a low risk tolerance concerning operational risks including legal, tax, and regulatory compliance and business process and continuity risk. 40 Principal risks and uncertainties Risk management framework INVESTMENT RISKS Investment performance Valuation EXTERNAL RISKS Political and macro-economic uncertainty Climate change Private equity sector Foreign exchange OPERATIONAL RISKS Regulatory, legal and tax compliance People Information security The Manager and third-party providers FINANCIAL RISKS Financing The Board is responsible for risk management and determining the Company’s overall risk appetite. The Audit Committee assesses and monitors the risk management framework and specifically reviews the controls and assurance programmes in place. BOARD OF DIRECTORS Responsible for risk management leadership Guides and provides counsel AUDIT COMMITTEE Reviews and monitors the risk management process Provides regular reporting THE MANAGER Responsible for risk reporting and running the controls assurance programmes overseen by the Manager’s Risk Committee 48 Corporate governance report ICG Enterprise Trust Plc Annual Report and Accounts 2022 39 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONPrincipal risks and uncertainties How we manage and mitigate our key risks RISK IMPACT MITIGATION CHANGE IN THE YEAR INVESTMENT RISKS INVESTMENT PERFORMANCE The Manager selects the fund investments and direct co-investments for the Company’s Portfolio. The underlying managers of those funds in turn select individual investee companies. The origination, investment selection and management capabilities of both the Manager and the third-party managers are key to the performance of the Company. VALUATION In valuing its investments in private equity funds and unquoted companies and publishing its NAV, the Company relies to a significant extent on the accuracy of financial and other information provided by the underlying managers to the Manager. There is the potential for inconsistency in the valuation methods adopted by the managers of these funds and companies and for valuations to be misstated. Poor origination, investment selection and monitoring by the Manager and/or third-party managers which may have a negative impact on Portfolio performance. Incorrect valuations being provided would lead to an incorrect overall NAV. The Manager has a strong track record of investing in private equity through multiple economic cycles. The Manager has a highly selective investment approach and disciplined process, which is overseen by ICG Enterprise Trust’s Investment Committee within the Manager, which comprises a balance of skills and perspectives. Further, the Company’s Portfolio is diversified, reducing the likelihood of a single investment decision impacting Portfolio performance. The Manager carries out a formal valuation process involving a quarterly review of third-party valuations. This includes a comparison of unaudited valuations to latest audited reports, as well as a review of any potential adjustments that are required to ensure the valuation of the underlying investments are in accordance with the fair market value principles required under International Financial Reporting Standards (‘IFRS’). Stable The Board is responsible for ensuring that the investment policy is met. The day-to-day management of the Company’s assets is delegated to the Manager under investment guidelines determined by the Board. The Board regularly reviews these guidelines to ensure they remain appropriate and monitors compliance with the guidelines through regular reports from the Manager, including performance reporting. The Board also reviews the investment strategy at least annually. Following this assessment and other considerations, the Board concluded that performance risk has remained stable during the year. Stable The Board regularly reviews and discusses the valuation process in detail with the Manager, including the sources of valuation information and methodologies used. Following this assessment and other considerations, the Board concluded that there was no material change in valuation risk during the year. 40 ICG Enterprise Trust Plc Annual Report and Accounts 2022 RISK IMPACT MITIGATION CHANGE IN THE YEAR EXTERNAL RISKS POLITICAL AND MACRO- ECONOMIC UNCERTAINTY Political and macro-economic uncertainty and other global events, such as pandemics, that are outside of the Company’s control could adversely impact the environment in which the Company and its investment portfolio companies operate. Changes in the political or macro-economic environment could significantly affect the performance of existing investments (and valuations) and prospects for realisations. In addition, it could impact the number of credible investment opportunities the Company can originate. CLIMATE CHANGE The underlying managers of the fund investments and direct co-investments in the Company’s Portfolio fail to ensure that their portfolio companies respond to the emerging threats from climate change. Climate-related transition risks, driven in particular by abrupt shifts in the political and technological landscape, impact the value of the Company’s Portfolio. PRIVATE EQUITY SECTOR The private equity sector could fall out of favour with investors leading to a reduction in demand for the Company’s shares. A change in sentiment to the sector has the potential to damage the Company’s reputation and impact the performance of the Company’s share price and widen the discount the shares trade at relative to NAV per share, causing shareholder dissatisfaction. The Manager uses a range of complementary approaches to inform strategic planning and risk mitigation, including active investment management, profitability and balance sheet scenario planning and stress testing to ensure resilience across a range of outcomes. The process is supported by a dedicated in-house economist and professional advisers where appropriate, to ensure it is prepared for any potential impacts (to the extent possible). The Manager has a well-defined, firm-wide Responsible Investing Policy and ESG framework in place. A tailored ESG framework applies across all stages of the Company’s investment process. This includes ongoing monitoring of the underlying manager’s ESG reporting. Private equity continues to outperform public markets over the long term and has proved to be an attractive asset class through various cycles. The Manager is active in marketing the Company’s shares to a wide variety of investors to ensure the market is informed about the Company’s performance and investment proposition. The Board monitors the discount to NAV and considers appropriate solutions to address any ongoing or substantial discount to NAV, including share buybacks. FOREIGN EXCHANGE The Company has continued to expand its geographic diversity by making investments in different countries. Accordingly, several investments are denominated in US dollars, euros and currencies other than sterling. At present, the Company does not hedge its foreign exchange exposure. Therefore, movements in exchange rates between these currencies may have a material effect on the underlying valuations of the investments and performance of the Company. The Board regularly reviews the Company’s exposure to currency risk and reconsiders possible hedging strategies on at least an annual basis. Furthermore, the Company’s multicurrency bank facility permits the borrowings to be drawn in euros and US dollars, if required. Increasing The Board monitors and reviews the potential impact on the Company from political and economic developments on an ongoing basis, including input and discussions with the Manager. Incorporating these views and other considerations, the Board concluded that there was an increase in political and macro-economic uncertainty risk as a result of the conflict in Ukraine. Increasing Wider society’s focus on this risk has increased, however we believe that climate change has yet to be fully priced in by financial markets. Delays in responding to climate risk could lead to potentially large and unanticipated shifts in valuations for impacted industries and sectors. During the year the Board received reports on the implementation of the Manager’s Responsible Investing Policy. Stable The Board receives regular updates from the Company’s broker and is kept informed of all material discussions with investors and analysts. Incorporating these updates and other considerations, the Board concluded that there was no material change in private equity sector sentiment risk during the year. Stable The Board reviewed the Company’s exposure to currency risk and possible hedging strategies and concluded that there was no material change in foreign exchange risk during the year and that it remains appropriate for the Company not to hedge its foreign exchange exposure. ICG Enterprise Trust Plc Annual Report and Accounts 2022 41 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Principal risks and uncertainties continued RISK IMPACT MITIGATION CHANGE IN THE YEAR OPERATIONAL RISKS REGULATORY, LEGAL AND TAX COMPLIANCE Failure by the Manager to comply with relevant regulation and legislation could have an adverse impact on the Company. Additionally, adherence to changes in the legal, regulatory and tax framework applicable to the Manager could become onerous, lessening competitive or market opportunities. The failure of the Manager and the Company to comply with the rules of professional conduct and relevant laws and regulations could expose the Company to regulatory sanction and penalties as well as significant damage to its reputation. PEOPLE Loss of key professionals at the Manager could impair the Company’s ability to deliver its investment strategy and meet its external obligations if replacements are not found in a timely manner. If the Manager’s team is not able to deliver its objectives, investment opportunities could be missed or misevaluated, while existing investment performance may suffer. INFORMATION SECURITY The Company is dependent on effective information technology systems at both the Manager and Administrator. These systems support key business functions and are an important means of securing data and sensitive information. The failure of the Manager and Administrator to deliver an appropriate information security platform for critical technology systems could result in unauthorised access by malicious third parties, breaching the confidentiality, integrity and availability of Company data, negatively impacting the Company’s reputation. 42 ICG Enterprise Trust Plc Annual Report and Accounts 2022 The Board is responsible for ensuring the Company’s compliance with all applicable regulatory, legal and tax requirements. Monitoring of this compliance has been delegated to the Manager, of which the in-house Legal, Compliance and Risk functions provide regular updates to the Board covering relevant changes to regulation and legislation. The Board and the Manager continually monitor regulatory, legislative and tax developments to ensure early engagement in any areas of potential change. The Manager regularly updates the Board on team developments and succession planning. The Manager places significant focus on: • Developing key individuals to ensure that there is a pipeline of potential succession candidates internally. External appointments are considered if that best satisfies the business needs. • A team-based approach to investment decision-making i.e. no one investment professional has sole responsibility for an investment or fund manager relationship. • Sharing insights and knowledge widely across the investment team, including discussing all potential new investments and the overall performance of the Portfolio. • Designing and implementing a compensation policy that helps to minimise turnover of key people. Application of the Manager’s and Administrator’s information security policies is supported by a governance structure and a risk framework that allow for the identification, control and mitigation of technology risks. The effectiveness of the framework is periodically assessed. Additionally, the Manager’s and Administrator’s technology environments are continually maintained and subject to regular testing, such as penetration testing, vulnerability scans and patch management. Stable The Company remains responsive to a wide range of developing regulatory areas; and will continue to enhance its processes and controls in order to remain compliant with current and expected legislation. The Board concluded that there was no material change in respect of regulatory, legal and tax risk. Stable The Board reviewed the Company’s exposure to people risk and concluded that the Manager continues to operate sustainable succession, competitive remuneration and retention plans. The Board believes that the risk in respect of people remains stable. Stable In order to gain a more comprehensive understanding of the Manager’s internal controls and risk management systems the Board carries out a formal annual assessment (supported by the Manager’s internal audit function). In response to the continued heightened risk of cyber security as a result of the COVID-19 pandemic, the Manager implemented several initiatives to further protect against the prevention and leakage of sensitive data. Following this review and other considerations, the Board concluded that there was no material change in information security risk during the year. RISK IMPACT MITIGATION CHANGE IN THE YEAR OPERATIONAL RISKS CONTINUED THE MANAGER AND THIRD-PARTY PROVIDERS (INCLUDING BUSINESS PROCESSES AND CONTINUITY) The Company is dependent on third parties for the provision of services and systems, especially those of the Manager, the Administrator and the Depositary. Failure by a third-party provider to deliver services in accordance with its contractual obligations could disrupt or compromise the functioning of the Company. A material loss of service could result in, among other things, an inability to perform business critical functions, financial loss, legal liability, regulatory censure and reputational damage. Stable In order to gain a more comprehensive understanding of the Manager’s internal controls and risk management systems the Board carries out a formal annual assessment (supported by the Manager’s internal audit function). The Board also received regular reporting from the Manager and other third parties, setting out the measures that they have put in place to address the COVID-19 pandemic crisis, in addition to their existing business continuity framework. Having considered these arrangements and reviewed service levels since the crisis has evolved, the Board is confident that a good level of service has been and will be maintained. Following this review and other considerations, the Board concluded that there was no material change in the Manager and other third-party advisers’ risk during the year. The performance of the Manager, the Administrator, the Depositary and other third-party providers is subject to regular review and reported to the Board. The Manager, the Administrator and the Depositary produce internal control reports to provide assurance regarding the effective operation of internal controls. These reports are provided to the Audit Committee for review. The Committee would seek further representations from service providers if not satisfied with the effectiveness of their control environment. The Audit Committee formally assesses the internal controls of the Manager, the Administrator and Depositary on an annual basis to ensure adequate controls are in place. The assessment in respect of the current year is discussed in the Report of the Audit Committee within the Annual Report. The Management Agreement and agreements with other third-party service providers are subject to notice periods that are designed to provide the Board with adequate time to put in place alternative arrangements. FINANCIAL RISKS FINANCING The Company has outstanding commitments that may be drawn down at any time in excess of total liquidity to private equity funds. The ability to fund this difference is dependent on receiving cash proceeds from investments (the timing of which are unpredictable) and the availability of financing facilities. If the Company encountered difficulties in meeting its outstanding commitments, there would be significant reputational damage as well as risk of damages being claimed from managers and other counterparties. The Manager monitors the Company’s liquidity, overcommitment ratio and covenants on a frequent basis, and undertakes cash flow monitoring, and provides regular updates on these activities to the Board. Stable Following a reduction of the financing risk exposure the previous year to reflect the signing of the Company’s new credit facility that matures in February 2026, the Board concluded that there was no material change in financing risk. The Company’s Strategic Report is set out on pages 1 to 43 and was approved by the Board on 11 May 2022. Jane Tufnell Chair 11 May 2022 ICG Enterprise Trust Plc Annual Report and Accounts 2022 43 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Governance overview Effective corporate governance is fundamental to the way ICG Enterprise Trust conducts business. JANE TUFNELL Chair Aligning our culture with our purpose Dear shareholders, Board developments CREATION OF MANAGEMENT ENGAGEMENT COMMITTEE In line with the AIC Code, the Board has formed a new Management Engagement Committee to enhance its oversight of the Manager and other key suppliers. The MEC held its inaugural meeting during the year to increase the rigour of the Board’s monitoring in this area. RETIRING DIRECTORS Sandra Pajarola retires from the Board on 30 June 2022 having served nine years. As previously communicated, Lucinda Riches retired from the Board on 21 June 2021 having served 10 years (including since 2018 as Senior Independent Director). We thank them both for their services. I, along with the rest of the Board, am continually assessing Board composition and will update in due course. Effective corporate governance is fundamental to the way ICG Enterprise Trust conducts business. By encouraging entrepreneurial and responsible management, it supports the creation of long-term, sustainable value for shareholders and for wider society. Effective oversight of strategy and risk is particularly important to promote the long-term success of the Company. In performing this role, the Board seeks to be responsive to both the evolving regulatory environment and changing expectations about the role of business in society. In particular, the Board seeks to ensure that both its own culture and that of the Manager is aligned with the Company’s purpose and values, and that the Company has the necessary financial and human resources to deliver its strategy. 44 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Role of the Board STRATEGIC OVERSIGHT It is the responsibility of the Board to ensure that there is effective stewardship of the Company’s affairs. Strategic issues are determined by the Board and a formal schedule of operational matters reserved for the Board has been adopted. In order to enable them to discharge their responsibilities, directors have full and timely access to relevant information. COMPLIANCE WITH THE CODE The Board applies the principles of the AIC Code of Corporate Governance (‘AIC Code’). The AIC Code adapts the Principles and Provisions set out in the UK Corporate Governance Code (‘the Code’) issued by the Financial Reporting Council to make them more relevant for investment companies. BOARD PERFORMANCE EVALUATION The Board has a formal process for the annual evaluation of its own performance and that of the Chair, which took place as usual during the year. The most recent evaluation concluded in January 2022 that the Board and its members continue to operate effectively. CULTURE AND VALUES The Board expects all directors to act with integrity and to apply their skill, care, due diligence and professional experience in deliberations regarding the Company’s business. The Board applies various practices and behaviours to ensure that its culture aligns with the Company’s purpose, values and strategy, including a robust annual review and a regular consideration of our direction at Board meetings. SUCCESSION PLANNING The Board’s tenure and succession policy seeks to ensure that the Board remains well balanced through the appointment of directors with a range of skills and experience. This is managed through the phased appointments of new directors. REGULAR MEETINGS The Board, which meets at least four times each year, reviews the Company’s investment Portfolio and investment performance and considers financial reports. There is also contact with the directors between meetings where this is necessary for the Company’s business. Board of Directors The Board is responsible for the effective stewardship of the Company’s affairs JANE TUFNELL Chair of the Board ALASTAIR BRUCE Independent Non-Executive Director SANDRA PAJAROLA1 Independent Non-Executive Director DAVID WARNOCK Senior Independent Director GERHARD FUSENIG Independent Non-Executive Director AUDIT COMMITTEE Alastair Bruce (Chair) Gerhard Fusenig Sandra Pajarola1 Jane Tufnell David Warnock MANAGEMENT ENGAGEMENT COMMITTEE David Warnock (Chair) NOMINATIONS COMMITTEE Jane Tufnell (Chair) Alastair Bruce Gerhard Fusenig Sandra Pajarola1 Jane Tufnell Alastair Bruce Gerhard Fusenig Sandra Pajarola1 David Warnock KEY RESPONSIBILITIES Reviewing the interim and annual financial statements KEY RESPONSIBILITIES Monitor and evaluate the performance and remuneration of the Manager KEY RESPONSIBILITIES Selecting and proposing suitable candidates for appointment or reappointment to the Board Reviewing the effectiveness and scope of the external audit Monitor and evaluate the performance and remuneration of other key service providers Reviewing the risks to which the Company is exposed and mitigating controls Overseeing compliance with regulatory and financial reporting requirements 1 Retiring on 28 June 2022. 60 Report of the Audit Committee 50 Corporate governance report 50 Corporate governance report ICG Enterprise Trust Plc Annual Report and Accounts 2022 45 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONBoard of Directors All members of the Board are independent non-executive directors BOARD OVERVIEW COMPOSITION AND INDEPENDENCE The Board is currently comprised of five non-executive directors. There is no Chief Executive Officer position within the Company as day-to-day management of the Company’s affairs has been delegated to the Manager. BOARD DIVERSITY There are currently two female and three male directors on the Board. The Board considers all candidates for Board appointments and does not discriminate based on gender or any other factor, making appointments based solely on the skills and experience of the candidates. TENURE The Company has no employees and given the nature of its business as an investment company, the Board believes that it is important for it to be refreshed with new members periodically. Committee membership Audit Management Engagement Nominations JANE TUFNELL Chair Background Jane Tufnell was appointed to the Board in April 2019 and became Chair in June 2020. She started her career in 1986 joining County NatWest, where she jointly ran the NatWest Pension Fund’s exposure to UK smaller companies. In 1994 she co-founded Ruffer Investment Management Ltd where she worked for over 20 years to build the business to an AUM of £20bn, before leaving in 2015. Jane is Chair of Odyssean Investment Trust and a non-executive director of Schroder UK Public Private Trust plc. She has served as a non-executive director of a number of other entities. Experience Jane brings extensive financial services and fund management experience to the Board. She is a seasoned public company board member and chair, and has significant experience of all aspects of investment company management, governance and regulation. DAVID WARNOCK ALASTAIR BRUCE Senior Independent Non-Executive Director and Chair of the Management Engagement Committee Independent Non-Executive Director and Chair of the Audit Committee Background David Warnock was appointed to the Board in December 2020, and became Senior Independent Director in June 2021. David co-founded the investment firm Aberforth Partners and was a partner for 19 years until his retirement from that firm in 2008. He has held non-executive directorships of several public and private companies and before Aberforth was with Ivory & Sime plc and 3i Group plc. David is currently Chair of Troy Income & Growth Trust plc, Chair of BMO Managed Portfolio Trust plc and an active investor in a number of private companies. Experience David brings extensive private equity, investment trust, and listed company experience to the Board. He worked for many years in private equity and served as a non-executive director of abrdn Private Equity Opportunities Trust plc. He has been involved in all aspects of investment trusts, either as a manager or as a non-executive director, for over 30 years. Background Alastair Bruce was appointed to the Board in 2018 and became Chair of the Audit Committee in February 2019. Alastair was Managing Partner of Pantheon Ventures between 2006 and 2013, having joined the firm in 1996. During his tenure at Pantheon Ventures, Alastair was involved in all aspects of the firm’s business, particularly the management of Pantheon International Participations PLC (‘PIP’), the expansion of Pantheon Ventures’ global platform and the creation of a co-investment business. Experience Alastair brings over 25 years of private equity, investment management and financial experience to the Board. Through his involvement with the management of PIP, he has extensive experience of managing a listed private equity vehicle. 46 ICG Enterprise Trust Plc Annual Report and Accounts 2022 At a glance Gender diversity Board nationality Male Female 60% 40% UK US/Switzerland Germany 60% 20% 20% Jane Tufnell David Warnock Alastair Bruce Gerhard Fusenig Sandra Pajarola Matrix of skills and experience Investment Trusts Private Equity Asset Management UK Corporate Governance International Finance/Audit Meetings Board member Board Audit MEC Nominations Jane Tufnell David Warnock Alastair Bruce Gerhard Fusenig Sandra Pajarola Lucinda Riches1 6/6 6/6 6/6 6/6 6/6 2/2 4/4 4/4 4/4 4/4 4/4 2/2 2/2 2/2 2/2 2/2 2/2 N/A 1/1 1/1 1/1 1/1 1/1 N/A 1 Retired from the Board on 21 June 2021. The quorum for any Board meeting is two directors but attendance by all directors at each meeting is strongly encouraged. ICG Enterprise Trust Plc Annual Report and Accounts 2022 47 GERHARD FUSENIG Independent Non-Executive Director Background Gerhard Fusenig was appointed to the Board in 2019. Over the last 25 years, Gerhard has held a number of senior management roles including the position of co-COO of Asset Management and CEO of Core Investments at Credit Suisse, as well as Global Head of Fund Services at UBS. Gerhard is a non-executive director of Credit Suisse Insurance Linked Strategies Ltd and of SolvencyAnalytics AG. Former directorships include Standard Life Aberdeen PLC and Aberdeen Asset Management PLC. Experience Gerhard is highly experienced as an executive in the investment management sector and is also very familiar with board practices and corporate governance requirements due to his range of board positions, including major listed companies. SANDRA PAJAROLA Independent Non-Executive Director Background Sandra Pajarola was appointed to the Board in March 2013 and will retire in June 2022. Sandra has over 30 years of experience in private equity and financial services. She was a Partner at Partners Group having served on its global investment committee for 12 years and was key in building up and managing its primary funds’ investment team and portfolio. In her role, she also held various board seats on direct investments as well as advisory board seats for funds. Since 2013, she has acted as an Operating Partner for Partners Group. In addition, Sandra is an angel investor in private equity across Europe and a private adviser to investment firms in the technology and social impact sectors. Experience Sandra brings extensive private equity investing experience having executed a similar strategy during her time at Partners Group. As the head of the team there Sandra built relationships with many private equity managers in Europe and has a broad perspective on the private equity industry. Her ongoing roles in the industry give her valuable insight into the private equity market across Europe. STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Corporate governance report CORPORATE GOVERNANCE The Company is committed to appropriate standards of corporate governance. Since 1 February 2021, the Board has applied the principles of the AIC Code of Corporate Governance (‘AIC Code’). The AIC Code adapts the Principles and Provisions set out in the UK Corporate Governance Code (‘the Code’) issued by the Financial Reporting Council to make them more relevant for investment companies. The Board considers that reporting against the Principles and Provisions of the AIC Code, which has been endorsed by the Financial Reporting Council, provides more relevant information to shareholders. The Board remains cognisant of the provisions of the Code. A copy of the AIC Code and the Code can be obtained from the websites of the Association of Investment Companies (www.theaic.co.uk) and of the Financial Reporting Council (www.frc.org.uk) respectively. Throughout the year, the Company complied with the provisions of the AIC Code; the Board was aware that Lucinda Riches (who retired in June 2021) had served since July 2011, but still considered her to be independent throughout the year despite her serving for more than nine years. The Board subscribes to the view that long-serving directors should not be prevented from forming part of an independent majority. It does not consider that a director’s tenure necessarily reduces his or her ability to act independently and, following formal performance evaluations, believes that each of the directors is independent in character and judgement and that there are no relationships or circumstances which are likely to affect their judgement. The Board considers that the tenure profile of the Board, represented by the length of service of each of its directors, is appropriately balanced such that Board succession and renewal planning is managed over the medium to longer term. The composition of the Board continues to include directors who bring an appropriate mix of skills, experience, expertise and diversity (including gender diversity) to Board decision making. All of the Company’s directors will seek re-election at each Annual General Meeting. The terms and conditions of appointment of the non-executive directors will be available for inspection at the AGM. Each non-executive director is appointed by a letter of appointment on an ongoing basis and shareholders vote on whether to elect/ re-elect him or her at every AGM. A non-executive director will only be proposed for re-election at an AGM if the Board is satisfied with the non-executive director’s performance, independence and ongoing time commitment. There is no absolute limit to the period that a non- executive director can serve for; however the Board recognises wider views regarding length of service and factors these in when considering whether or not directors’ appointments should be continued. The Directors’ Remuneration Report, comprising the Remuneration Policy, which shareholders will be asked to approve at the Annual General Meeting, can be found on pages 56 to 59. The Company is also subject to the Alternative Investment Fund Managers Directive (‘AIFMD’) and has a management agreement with the Manager to act as its Alternative Investment Fund Manager (‘AIFM’). Aztec Financial Services (UK) Limited acts as its depositary, in accordance with the requirements of the AIFMD. Composition and independence The Board is currently comprised of five non- executive directors and has had one change in membership during the year (Lucinda Riches retired from the Board on 21 June 2021). There is no Chief Executive Officer position within the Company as day-to-day management of the Company’s affairs has been delegated to the Manager. The Board regularly reviews the independence of its members and, having due regard to the definitions and current guidelines on independence under the Code, considers all directors to be independent (despite the length of service of some directors, in respect of whom it has concluded that they are independent in judgement and character). There are no relationships or circumstances relating to the Company that are likely to affect their judgement. The Board has agreed that during 2022 it will begin to act as a host Board for an Apprentice under the Board Apprentice scheme, which is designed to increase access to board level positions for those who have not previously had this experience. The Board Apprentice will not be a member of the Board but will attend, and contribute, to all meetings. Senior Independent Director David Warnock is the Senior Independent Director. He provides support to the Chair in her role leading the Board while also providing his challenge and acting as a conduit for any points to be raised in respect of the Chair. Following the recent Board evaluation, the Board considers him to be operating effectively in this role. Induction and training Board training is provided regularly to ensure that Board members are well placed to conduct their role. In addition, directors benefit from training received while sitting as members of other boards. New Board members receive a formal induction on all aspects of the Company’s business. Performance evaluation The Board reviews its own performance annually with an external assessment undertaken every three years. The assessment covers the effectiveness and performance of the Board as a whole, the Board Committees and an evaluation of each director. This process helps ensure that the Board’s operations remain aligned with the culture, purpose and values of the Company. The last external assessment was undertaken in the year ended 31 January 2021. The Board conducted an internal self- evaluation led by the Chair. This involved the submission of written questionnaires and then a full discussion of the output. The review concluded that the Board continues to operate effectively and coherently, with a collaborative approach taken. As a result of the review, the Board has made some refinements to its annual programme, including separating the annual strategy session from being held on the same day as a standard Board meeting to allow separate focus on strategic matters. Each individual director was also assessed as part of the evaluation and it was concluded that each director continues to make a valuable contribution to the Board. It was noted that, given her background as a private equity investor, the forthcoming retirement of Sandra Pajarola would mean a need for a director to be recruited to enhance the skill set of the Board in a similar way. Directors’ time commitments The Company has a policy of ensuring that all non-executive directors of the Company have sufficient time to commit to the respective duties and responsibilities applicable to their particular Board roles. When making new appointments, the Board takes into account other demands on potential candidates’ time and prior to appointment any significant commitments are disclosed with an indication of the time involved. In the year under review the Board assessed the time commitment of each individual director on external appointments. Each director’s aggregate time commitment is discussed with him or her as part of the annual appraisal process. In the year under review, all directors were considered to have sufficient time to commit to their respective roles on the Board, taking account of their external appointments. 48 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Board diversity There are currently two female and three male directors on the Board. The Board considers all candidates for Board appointments and does not discriminate based on gender or any other factor, making appointments based solely on the skills and experience of the candidates. The Board is aware of the requirements of the Parker Review in respect of ethnic diversity and acknowledges the importance of all forms of diversity. Diversity is one of the key considerations when directors are appointed to the Board, and is factored in to all searches for new directors. Tenure As discussed on page 50, the Board’s tenure and succession policy seeks to ensure that the Board remains well balanced through the appointment of directors with a range of skills and experience. The Company has no employees and given the nature of its business as an investment company, the Board believes that while it is important for it to be refreshed with new members (as has been actively done in the last few years), it is not of concern that at times a director with longer than nine years’ experience may be on the Board. Role of the Board It is the responsibility of the Board to ensure that there is effective stewardship of the Company’s affairs. Strategic issues are determined by the Board, a formal schedule of operational matters reserved for the Board has been adopted in order to enable it to discharge its responsibilities, and directors have full and timely access to relevant information. The Board, which meets at least four times each year, reviews the Company’s investment Portfolio and investment performance and considers financial reports. There is also contact with the directors between meetings where this is necessary for the Company’s business. There is an agreed procedure under which directors, wishing to do so in the furtherance of their duties, may take independent professional advice at the Company’s expense. In the event that in future any directors are unable to attend Board and Committee meetings, the relevant directors will be contacted by the Chair before and/or after the meeting to ensure they were aware of the issues being discussed and to obtain their input. At each Board meeting every agenda item is considered against the Company’s strategy, its investment objectives and its investment policy. A typical agenda includes: • a review of investment performance; • a review of investments and divestments and asset management initiatives in progress; • an update on investment opportunities available in the market and how they fit within the Company’s strategy; • consideration of any investment opportunities above a specified size; • a review of the Company’s financial performance; • a review of the Company’s financial forecasts, cash flow and ability to meet targets, including stressed scenarios and sensitivity analyses; • a review of the Company’s financial and regulatory compliance; • a review of any conflicts of interest, including the consideration of investments which may amount to a conflict of interest; • updates on shareholder and stakeholder relations; • updates on the Company’s capital market activity; and • specific regulatory, compliance or corporate governance updates. Board meetings also included a number of presentations from the Manager. Board papers are disseminated to the directors via a secure online platform for reasons of efficiency and cyber security. The online platform is also used to store relevant Company documentation, as it provides the directors with quick and secure access. Company Secretary The directors also have access to the advice and services of the Company Secretary, Andrew Lewis (on behalf of ICG FMC Limited). Information flows The Board receives written reports from the Manager and its advisers on at least a quarterly basis and as appropriate on specific matters. Prior to each Board meeting, directors are provided with a comprehensive set of papers giving detailed information on the Company’s transactions, financial position and performance. The Chair ensures that directors are provided, on a regular basis, with key information on the Company’s policies, regulatory requirements and its risk management and control results. The Board meetings follow a formal agenda, which is approved by the Chair and circulated by the Company Secretary in advance of the meeting to all the directors and other attendees. Insurance and indemnities During the year under review, the Board has maintained appropriate insurance cover in respect of legal action against the directors. The policy does not cover dishonest or fraudulent actions by the directors. Stewardship The Company seeks to make investments in funds and companies which are well managed with high standards of corporate governance. The directors believe this creates the proper conditions to enhance long-term shareholder value. The exercise of voting rights attached to the Company’s Portfolio has been delegated to the Manager. However, the Board will be informed of any sensitive voting issues involving the Company’s investments. Conflicts of interest The Company has adopted a policy requiring all directors to disclose other positions and also any other matter which may give rise to a conflict. Such conflicts can then be considered by the other directors and, if necessary, either approved or not approved. Currently there are no material conflicts in respect of any director. Anti-bribery and Corruption Policy The Manager has processes in place to ensure that bribery and corruption do not take place within the Manager or the Company. These include formal policies and regular training for all employees. The Board has reviewed these processes and found them adequate. Whistleblowing Policy and arrangements The Board and the Audit Committee have been made aware of the processes the Manager has in place to ensure that staff of the Manager may in confidence raise concerns about possible improprieties in matters of financial reporting or other matters and ensure that arrangements are in place for the proportionate and independent investigation of such matters and follow up action. The Manager has established and implemented processes. These include formal policies and regular training for all employees. Internal control around financial reporting The key features of the Company’s internal control systems that ensure the accuracy and reliability of financial reporting include clearly defined lines of accountability and delegation of authority, policies and procedures that cover financial reporting, preparation of quarterly management accounts, project governance and a review of the disclosures within the Annual Report and Accounts from functional heads. This combined ensures the disclosures made appropriately reflect the developments within the Company in the year and meet the requirement of being fair, balanced and understandable. ICG Enterprise Trust Plc Annual Report and Accounts 2022 49 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Corporate governance report continued Environmental Policy Due to the Company’s premium listing on the London Stock Exchange, the Company is required to disclose its Environmental Policy. Further information on the social and environmental policies of the Manager can be found in the Investing responsibly section on pages 24 and 25. COMMITTEES Nominations Committee All of the directors serve on the Nominations Committee which meets when necessary to select and propose suitable candidates for appointment or reappointment to the Board. The Committee is chaired by Jane Tufnell (save in respect of matters relating to the Chair of the Board, when it is chaired by the Senior Independent Director). When making an appointment, the Board considers the existing composition of the Board to determine areas which require strengthening. Independent external consultants are used to help identify a shortlist of candidates. The Board’s tenure and succession policy seeks to ensure that the Board is well balanced by the appointment of directors with a range of skills and experience. Candidates for the Board are assessed as to the appropriateness of their skills and experience prior to their appointment. The Committee is mindful of all forms of diversity in its processes, and does not discriminate based on gender or any other factor when considering candidates. The Board is aware of the requirements of the Parker Review in respect of ethnic diversity and acknowledges the importance of all forms of diversity. Diversity is one of the key considerations when directors are appointed to the Board, and is factored in to all searches for new directors. The Committee has adopted a succession plan to ensure that succession matters continue to be appropriately considered over the coming years. The long-term plan takes account of the potential future retirements of directors who reach nine years of service and the skills that they bring which will need replacement, and envisages that successors will be sought ahead of such retirements to allow for an appropriate handover period with minimal disruption. During the financial year the Nominations Committee reviewed the composition of the Board and identified the capabilities needed for Board roles and the succession timeframe; the Committee reviewed the related role profile submitted to external search consultants along with the request to prepare a list of suitable candidates. The Committee is currently considering candidates to supplement the Board following the retirement of Sandra Pajarola. Remuneration Committee As the Board is comprised solely of non-executive directors, the Company does not have a Remuneration Committee. The determination of the directors’ fees is dealt with by the whole Board. Please see pages 56 to 59 for the Directors’ Remuneration Report. Audit Committee Please see pages 60 and 61 for the Report of the Audit Committee. Management Engagement Committee In accordance with industry good practice, in February 2021 the Company formed a Management Engagement Committee to review the activities of the Manager and other key service providers. The MEC is chaired by David Warnock and is comprised of all of the directors; it will meet at least annually. The Committee held its inaugural meeting in April 2021. It met again in September 2021, and conducted a detailed review of the performance of all key service providers. A number of follow up actions were agreed, but the Committee concluded that in all material respects all service providers were performing to the required standards. Engagement with service providers The Board operates in an open and co-operative manner with the Company’s stakeholders, particularly in light of the long-term nature of the Company’s investment proposition. The Board expects the Company’s third-party service providers, particularly the Manager who is responsible for the management of the Company’s Portfolio, to uphold the same values as the Board. To this end, the Board (via the Management Engagement Committee) considers the Manager’s corporate culture as part of the overall assessment of the service provided to it. Stakeholder engagement Please see pages 34 to 37 for further details. INTERNAL CONTROLS The Board, at least annually, assesses the internal controls of the Manager. There have been no material adverse findings from this review. Please see page 60 for details of this in the Report of the Audit Committee. The Company does not have an internal audit function, although the need for such a function is considered annually. 50 ICG Enterprise Trust Plc Annual Report and Accounts 2022 All of the Company’s management functions are delegated to the Manager, which has its own internal audit function. The Manager’s internal audit function provides an annual report to the Board on internal controls and this forms part of the Board’s review of the internal controls. SHAREHOLDER RELATIONS Both the Company’s Annual Report and Accounts, containing a detailed review of performance and of changes to the investment Portfolio, and our regular factsheets, containing updated information in a more abbreviated form, are made available to shareholders through the Company’s website. A copy of the latest Company presentation is available on the Company’s website. Quarterly releases in respect of the Company’s performance are announced to the market and available to shareholders. At the AGM, in ordinary circumstances a presentation is made by the Manager and investors are given an opportunity to question the Chair, the other directors and the Manager. Communication with shareholders is given a high priority by the Board. The Manager and all directors, and in particular the Chair and Senior Independent Director, are available to enter into dialogue with shareholders. The Manager holds regular discussions with analysts and existing and potential institutional shareholders and values the feedback obtained in this manner. A structured programme of shareholder presentations by the Manager to institutional shareholders takes place following the publication of the Annual Report and quarterly results. In addition, Board members are available to meet institutional shareholders. The Board receives regular updates from the Company’s broker and is kept informed of all material discussions with investors and analysts which helps the directors develop their understanding of shareholders’ views and expectations. A detailed list of the Company’s shareholders is reviewed at each Board meeting. Directors can be contacted via the registered office of the Company (see the Shareholder information section on page 99). As noted within the Manager’s review on pages 12 to 19, the Company’s financial position is strengthened by its access to its bank facility of €200m (£177m), which matures in February 2026 and is subject to a number of covenants. The Company had no drawings on its facility at 31 January 2022. The Company’s cash balance was £41.3m as at 31 January 2022. The Board has assessed the Company’s ability to remain viable and meet its liabilities as they fall due through the review of balance sheet and cash flow projections provided by the Manager. As part of this, a range of stressed scenarios and sensitivity analyses was examined to identify conditions that might result in the facility’s covenants being breached, and included the consideration of possible remedial action that the Company could undertake to avoid such breaches. Key variables considered included Portfolio gains and losses, fund drawdowns and realisations, availability of the credit facility, and exchange rates. Based on this assessment, the Board has a reasonable expectation that the Company will remain viable over a five-year period from the balance sheet date. Jane Tufnell Chair 11 May 2022 GOING CONCERN In assessing the appropriateness of continuing to adopt the going concern basis of accounting, the Board has assessed the financial position and prospects of the Company over the next 12 months. The Company’s business activities, together with factors likely to affect its future development, performance, position and cash flows, are set out in the Chair’s statement on pages 10 and 11, and the Manager’s review on pages 12 to 19. As part of this review, the Board assessed the potential impact of principal risks and the COVID-19 pandemic on the Company’s business activities, the Company’s cash position, the availability of the Company’s credit facility and compliance with its covenants, and the Company’s cash flow projections. Further details of this assessment, including stress testing and sensitivity analysis performed, are disclosed below within the Viability Statement. Based on this assessment, the Board expects that the Company will be able to continue in operation and meet its liabilities as they fall due until, at least, 31 May 2023, a period of more than 12 months from the signing of the financial statements. Therefore it is appropriate to continue to adopt the going concern basis of preparation of the Company’s financial statements. Therefore it is appropriate to continue to adopt the going concern basis of preparation of the Company’s financial statements. VIABILITY STATEMENT In accordance with the UK Corporate Governance Code, the Board has assessed the financial position and prospects of the Company over a longer period than the 12 months required by the ‘going concern’ basis of accounting. The Board has assessed the viability of the Company over a five-year period from the balance sheet date, being a period of time over which the Board can reasonably assess the Company’s prospects and over which the majority of the Company’s commitments will be drawn down. The Board has carried out a robust assessment of the principal risks and their mitigants as noted on pages 40 to 43. Those considered most significant to the viability of the Company included those relating to investment performance, political and macro-economic uncertainty, and the ability of the Company to manage its financing and overcommitment risk. ICG Enterprise Trust Plc Annual Report and Accounts 2022 51 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONReport of the Directors The Directors present their report and the audited financial statements for the year ended 31 January 2022 The Report of the Directors should be read in conjunction with the Strategic Report (pages 1 to 43) and the Directors’ Remuneration Report (pages 56 to 59). STATUS OF THE COMPANY ICG Enterprise Trust Plc (the ‘Company’) is an investment company as defined by Section 833 of the Companies Act 2006 and is registered and domiciled in England (number 1571089). During the year under review the Company carried on the business of an investment trust. The last accounting period for which the Company has been approved by HM Revenue & Customs in accordance with the provisions of Section 1158 of the Corporation Tax Act 2010 is the year ended 31 January 2022. The Company will retain its investment trust status with effect from 1 February 2022 provided it continues to satisfy the conditions of Section 1158 of the Corporation Tax Act 2010. The Company has continued to direct its affairs with the objective of retaining such approval. The Company’s shares are eligible for tax- efficient wrappers such as Individual Savings Accounts (‘ISAs’), Junior ISAs and Self Invested Personal Pensions (‘SIPPs’). REPORTING PERIOD This Annual Report has been prepared for the year to 31 January 2022. SIGNIFICANT SHAREHOLDINGS At 5 May 2022, the Company had received no notifications of disclosable interests in its issued share capital. INVESTMENT POLICY The Company’s investment policy is set out on page 55. The policy has not changed since last year. However, in accordance with corporate governance principles, the Board has decided that all directors will submit themselves for re-election every year. No material change will be made to the investment policy without prior shareholder approval. PURCHASE OF SHARES The Company has the authority, subject to various terms as set out in its Articles and in accordance with the Companies Act 2006, to acquire up to 14.99% of the shares in issue. The Company intends to renew this authority annually. During the course of the year, the Company purchased 250,000 shares (representing 0.3% of the issued share capital of the Company on 5 May 2022, being the latest practical date before publication of this document) at an average price of 1,070p, for a total cost of £2.7m at a weighted average discount of 27%. These shares are held in treasury. DIVIDEND Quarterly dividends in respect of the year ended 31 January 2022 were paid on 3 September 2021 (6.0p per share), 3 December 2021 (6.0p per share) and 4 March 2022 (6.0p per share) for a total of 18.0p per share. A final dividend of 9p per share will, if approved, be paid on 22 July 2022 to holders of ordinary shares on the register at the close of business on 8 July 2022. This would bring the total dividend for the year to 27p per share. DIRECTORS All of the directors listed on pages 46 and 47 held office throughout the year and up to the date of signing the financial statements, and, other than Sandra Pajarola, will stand for re- election at the forthcoming Annual General Meeting. Lucinda Riches retired from the Board on 21 June 2021. Sandra Pajarola and Gerhard Fusenig are both resident in Switzerland. All of the other directors of the Company are resident in the UK. The directors’ biographical details demonstrate the wide range of skills and experience that they bring to the Board. In addition to the requirement of the Articles of Association that one third of the Board is subject to retirement each year, all directors are required to submit themselves for re-election at least every three years. A thorough review of all directors standing for re-election has been conducted. The review concluded that all directors bring valuable skills and experience to the Board and continue to operate effectively, and accordingly are recommended for re-election. MANAGER ICG Alternative Investment Limited (‘ICG’ or the ‘Manager’) is the manager of the Company. ICG is authorised as an Alternative Investment Fund Manager and is regulated by the Financial Conduct Authority. The Manager provides investment management, company secretarial and general administrative services to the Company under a management agreement. This agreement can be terminated by either party giving not less than one year’s notice. The investment management fee payable under this agreement is calculated as 1.4% of the investment portfolio and 0.5% of outstanding commitments to funds in their investment periods, in both cases excluding the funds managed directly by ICG (see Note 18 on page 89) and by the former manager of the Company, Graphite Capital (see page 54). The Company also reimburses the Manager for irrecoverable VAT incurred, up to a cap of £100,000. The effective management fee charged by the Manager in the year was 1.25% of the Company’s net assets and the Company’s Ongoing Charges ratio was 1.40% as calculated in accordance with AIC guidance and as shown in the Glossary. Further information around cost disclosures can be found in the Company’s Key Information Document on the Shareholder information section of the Company’s website. For the ICG-managed funds (as disclosed in Note 18 to the financial statements on page 90) the annual management charge is between 1.3% and 1.5% of original commitments for funds in their investment period, and between 0.8% to 1.5% of unrealised cost for funds where their investment period has ended. 52 ICG Enterprise Trust Plc Annual Report and Accounts 2022 CO-INVESTMENT INCENTIVE SCHEME ICG and certain of its executives and, in respect of certain historic investments, the executives and connected parties of the Former Manager (together the ‘Co-investors’), are required to co-invest alongside the Company, for which they are entitled to a share of investment profits if certain performance hurdles are met, as set out below: CAPITAL As at 31 January 2022, 72,913,000 ordinary shares of 10.0p each were in issue and fully paid, including shares which had been bought back into Treasury. 4,395,945 Treasury Shares, representing 6.03% of the Company’s share capital, were held as at 5 May 2022, being the latest practical date before publication of this document. The Co-investors are required to contribute 0.5% of the cost of every new fund investment (excluding those investments made by Graphite Capital funds, and any ICG fund investments made after 1 February 2016) and direct investment made by the Company. If such an investment has generated at least an 8% per annum compound return in cash to the Company (the ‘Threshold’), the Co-investors are entitled to receive 10% of the Company’s total gains from that investment inclusive of return of cost, out of future cash receipts from the investment or, very rarely, in specie on the flotation of underlying portfolio companies. For investments made before 24 May 2007, if the Threshold is not achieved the Co- investors do not recover their contribution. For investments made after 24 May 2007, the Co-investors recover their contribution at the same rate as the Company recovers the cost of its investment. Further details of these arrangements can be found in Notes 1 and 9 to the financial statements. Resolutions will be proposed at the forthcoming AGM to: • allot up to a maximum of 22,610,628 ordinary shares of 10p each, representing 33% of the Company’s issued share capital (excluding shares held as Treasury Shares) as at 5 May 2022; and • disapply pre-emption rights on up to 10% of the issued share capital (excluding shares held as Treasury Shares) to enable the Board to re-issue any ordinary shares held in treasury without having first to offer them to all existing shareholders; and to renew the directors’ authority to buy back up to 10,270,706 ordinary shares (being 14.99% of the issued share capital (excluding shares held as Treasury Shares as at 5 May 2022)) subject to the constraints to be set out in the proposed resolution. The authority will be used where the directors consider it to be in the best interest of shareholders. It is the current intention of the Board that any shares thus purchased would be held as Treasury Shares. For the Graphite-managed funds (as disclosed on page 54) the annual management charge is 2% of original commitments for funds in their investment period, and between 1% to 2% for funds where their investment period has ended. The charges and incentive arrangements for both ICG and Graphite managed funds are at the same level as those paid by third-party investors in the funds. The Board reviews the activities and performance of the Manager on an ongoing basis, and reviews the investment strategy annually. The Board reviews the Company’s investment record over short and long-term periods, taking into account factors including the net asset value per share and the share price as well as the general competence of the Manager. The Board also considers the performance of the Manager in carrying out its company secretarial and general administrative functions. In addition, the Audit Committee carries out a formal assessment of the Manager’s internal controls and risk management systems every year. The Board has contractually delegated responsibility for management of the investment Portfolio and the provision of accounting and company secretarial services to the Manager. Custody of unquoted securities has been contractually delegated to an FCA regulated third-party custodian, Aztec Financial Services (UK) Limited (‘Aztec’). Aztec has also been appointed the Company’s depositary, in accordance with the Alternative Investment Fund Managers Directive. Custody of quoted securities has been contractually delegated to an FCA regulated third-party custodian, Charles Stanley & Co Limited, although Aztec retains liability for safeguarding in respect of these assets. The performance of these third parties is overseen by the Board as part of its regular reviews of the Manager. Based on the above, it is the Board’s opinion that the continuing appointment of ICG as Manager of the Company on the agreed terms is in the best interests of shareholders as a whole. ICG Enterprise Trust Plc Annual Report and Accounts 2022 53 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONReport of the Directors continued GREENHOUSE GAS EMISSIONS The Company has no employees and no premises, and therefore has no greenhouse gas emissions to report, nor does it have responsibility for any other emissions producing sources under the Companies Act 2006 (Strategic Report and Directors’ Reports) Regulations 2013 and the Streamlined Energy and Carbon Reporting (‘SECR’) requirements. TRANSFER OF SHARES AND VOTING RIGHTS All ordinary shares have equal voting rights. There are no restrictions concerning the transfer of securities in the Company, no special rights with regard to control attached to securities, no agreements between holders of securities regarding their transfer known to the Company, and no agreement to which the Company is party that affects its control following a takeover bid. The Company’s Articles of Association may be amended by special resolution of the shareholders in a general meeting. Holders of ordinary shares enjoy the rights set out in the Articles of Association of the Company and under the laws of England and Wales. Any share may be issued with or have attached to it such rights and restrictions as the Company by ordinary resolution, or failing such resolution, the Board may decide. DISCLOSURE OF INFORMATION TO AUDITORS Each of the persons who are a director at the date of approval of this report confirms that: • so far as the director is aware, there is no relevant audit information of which the Company’s auditors are unaware; and • each director has taken all the steps that he or she ought to have taken as a director in order to become aware of any relevant audit information and to establish that the Company’s auditors are aware of that information. The confirmation is given and should be interpreted in accordance with the provisions of Section 418 of the Companies Act 2006. INDEPENDENT AUDITORS As set out in the Report of the Audit Committee, Ernst & Young LLP were appointed as auditors for the year ended 31 January 2022 at the Annual General Meeting in 2021 and are recommended for reappointment by the Audit Committee. A resolution reappointing them and authorising the directors to determine their remuneration will be submitted at the AGM. INCORPORATION BY CROSS REFERENCE Certain information required to be disclosed in the Report of the Directors is shown within other sections of the Annual Report and Accounts. Please refer to the Corporate governance report on pages 48 to 51. ANNUAL GENERAL MEETING The Annual General Meeting will be held on 28 June 2022. Further details will be provided in the notice of general meeting to be circulated to shareholders. By order of the Board: Andrew Lewis On behalf of ICG FMC Limited 11 May 2022 INVESTMENTS IN GRAPHITE CAPITAL FUNDS (FORMER MANAGER) Fund Graphite Capital Partners IX Graphite Capital Partners VIII Graphite Capital Partners VIII Top Up Fund Graphite Capital Partners VII Graphite Capital Partners VII Top Up Fund Graphite Capital Partners VII Top Up Fund Plus 31 January 2022 Original commitment £’000 Remaining commitment £’000 30,000 40,000 20,000 35,138 8,157 4,158 8,882 3,113 1,295 906 348 300 Fair value £’000 8,935 31,679 2,565 4,951 4 2 Original commitment £’000 30,000 40,000 20,000 35,138 8,157 4,158 31 January 2021 Remaining commitment £’000 20,296 4,151 1,295 1,984 348 300 Fair value £’000 8,084 28,695 2,181 9,397 2,677 2,388 Total 137,453 14,844 48,136 137,453 28,374 53,422 54 ICG Enterprise Trust Plc Annual Report and Accounts 2022 COMPARATOR INDEX The Company’s comparator index is the FTSE All-Share Index Total Return. The Board considers that this provides the most appropriate reference point for the Company’s shareholders. HEDGING The Company holds investments and makes fund commitments in currencies other than sterling and is exposed to the risk of movements in the exchange rate of these currencies. From time to time the Company may put in place hedging arrangements in order to manage currency risk. The Company may also from time to time consider hedging certain other risks of the Company such as equity market exposure or interest rate risk. Investment policy The objective of ICG Enterprise Trust is to provide long-term growth by investing in private companies managed by leading private equity managers. INVESTMENT TYPE ICG Enterprise Trust will typically invest through: • Primary Funds: commitments to private equity funds during their initial fund raise. • Secondary Funds: acquiring interests in funds or investments after the fund’s initial fund raise accessed either directly or through a fund structure. • Co-investments: investing alongside leading private equity managers, or directly, in specific private companies. INVESTMENT STAGE The Company will predominantly gain exposure to private companies which are mature, cash generative, profitable businesses and where the underlying private equity manager exercises majority control. ICG Enterprise Trust may invest in other private markets strategies if it feels that these opportunities would offer shareholders similar risk-adjusted returns to its core investment strategy. It does not expect such investments to constitute a substantial part of its investment programme. PORTFOLIO CONSTRUCTION ICG Enterprise Trust does not have any fixed allocations to specific sectors or regions, but aims to be broadly diversified by geography, industry sector and year of investment. The Company may invest in either equity or debt instruments but expects that underlying investments will mostly be in equity instruments. It expects that the majority of its returns will be derived from capital appreciation. ENVIRONMENTAL, SOCIAL AND GOVERNANCE (‘ESG’) MATTERS ICG Enterprise Trust is committed to its responsibility to its community and environment and ESG matters are considered as part of the investment process. ICG Enterprise Trust aims to act responsibly and cautiously as the guardian of its investors’ capital and ensures that ESG matters are considered at all stages of the investment cycle. QUOTED SECURITIES ICG Enterprise Trust may from time to time have underlying interests in quoted companies. This is typically due to companies which were originally acquired as private companies being listed on public markets as part of an exit strategy. It may hold these interests through a fund (where the underlying manager is responsible for exiting the investment) or directly. ICG Enterprise Trust does not anticipate acquiring new listed investments unless directly related to the execution of its private company investment strategy. RISK DIVERSIFICATION The Company will ensure that its interest in any one portfolio company, taking into account direct and indirect holdings, will not exceed 15% of the Company’s total investments at the time of initial acquisition or subsequent addition. It is the Company’s policy to invest no more than 10% of its gross assets in other listed investment companies. OVERCOMMITMENT AND USE OF CREDIT FACILITIES The Company intends to be overcommitted in order to ensure a high level of investment. The Company may from time to time draw on its pre-agreed borrowing facilities to fund investment drawdowns and ongoing expenses of the Company. This allows the Company to operate a more efficient balance sheet by reducing the need to retain large cash balances. ICG Enterprise Trust’s objective is to be broadly fully invested, while ensuring that there is sufficient liquidity to be able to take advantage of attractive investment opportunities as they arise. We do not intend to be geared other than for short- term working capital purposes. The level of overcommitment is monitored regularly by the Board and the Manager, taking into account uninvested cash, the availability of bank facilities, the projected timing of cash flows to and from the Portfolio, and market conditions. CASH The Company holds cash on deposit with UK regulated banks or invests it in debt instruments or money market funds which themselves invest in such instruments. These investments are typically very liquid, with high credit quality and low capital risk. The Company will limit exposure to any one bank, issuer or fund to 15% of gross assets. ICG Enterprise Trust Plc Annual Report and Accounts 2022 55 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONDirectors’ remuneration report REMUNERATION COMMITTEE As the Board is comprised solely of non-executive directors, the Company does not have a Remuneration Committee. The determination of the directors’ fees is dealt with by the whole Board. STATEMENT BY THE CHAIR In accordance with the Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment) Regulations 2013, the Company presents its Remuneration Policy and Remuneration Report separately. The Remuneration Policy sets out how the Company proposes to pay the directors, including each element of remuneration that the directors are entitled to, and how this supports the Company’s long-term strategy and performance. Save as outlined below, all provisions of this policy are expected to remain in effect until the Annual General Meeting in 2023 when the Company is next required to submit its policy on the remuneration of its directors to the members. The Remuneration Report sets out how the Remuneration Policy has been implemented in the year. In accordance with the Remuneration Policy set out below, the Board performs an annual review of directors’ fees. The fees payable to the directors for the year ended 31 January 2023 were considered in January 2022. An increase in fees of 3.5% was applied, in line with inflation and market comparables. TABLE OF REMUNERATION BY ROLE Fee Directors’ base fee1 Chair of the Audit Committee Chair of the Board Year ending 31 January 2023 £ Year ended 31 January 2022 £ Year ended 31 January 2021 £ 43,780 54,130 67,000 42,300 52,300 64,600 41,400 43,600 59,400 1 The fee includes all fees payable for service as a director and a member of the Audit Committee. REMUNERATION POLICY It is the Company’s policy to determine the level of directors’ fees having regard to the level of fees payable to non-executive directors in the wider industry, the role that individual directors fulfil, the time committed to the Company’s affairs and the limits stated by the Company’s Articles of Association. It is not the Company’s policy to include an element of performance related pay; all fees are paid in cash rather than any other instrument. The Remuneration Policy has been unchanged for a number of years and is unchanged since the last shareholder approval at the 2020 Annual General Meeting. The Articles of Association and subsequent shareholder resolutions currently limit the aggregate fees payable to the directors to a total of £350,000 per annum. An amendment to the Articles of Association will be proposed at the Annual General Meeting to amend this limitation to take account of annual inflation and the number of directors on the Board. The Company’s performance is compared to the FTSE All-Share Index Total Return as this is considered to be the most appropriate comparator index. The level of fees for directors is reviewed annually by the Board. The Board considers the Remuneration Policy to be effective in supporting the short and long-term strategic objectives of the Company by ensuring that the Company continues to be able to recruit and retain non-executive directors who are suitably qualified and experienced to supervise the Company’s affairs. 56 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Share price performance1 ICG Enterprise Trust share price FTSE All-Share Index £500 £450 £400 £350 £300 £250 £200 £150 £100 £50 £0 £426 £204 Jan 2012 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 Jan 2019 Jan 2020 Jan 2021 Jan 2022 1 On a total return basis (i.e. including the effect of re-invested dividends). Indexed to a starting point of £100. Service contracts It is not the Company’s policy to enter into service contracts with its directors. No director has a service contract with the Company. The directors each serve under a letter of appointment. Notice period and loss of office payment policy The directors are subject to a notice period of one month unless removed by a resolution at a General Meeting or pursuant to any provision of the Articles of Association. It is not the Company’s policy to enter into arrangements that entitle any of the directors to compensation for loss of office. No director is entitled to any such compensation. Statement of consideration of conditions elsewhere in the Company The Company has no employees. Therefore the Company cannot take into account the pay and employment conditions of its employees when setting and implementing the Remuneration Policy. Statement of consideration of shareholder views The Company places great importance on communication with its shareholders. The Board confirms that no negative views were expressed in relation to its Remuneration Policy during the year. ICG Enterprise Trust Plc Annual Report and Accounts 2022 57 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONDirectors’ remuneration report continued DIRECTORS’ REMUNERATION The law requires the Company’s auditors to audit certain of the disclosures provided. Where disclosures have been audited, this is indicated below. The directors were not entitled to any loss of office payments, pension benefits, share options or other incentives in the year ended 31 January 2022 (2021: £nil). Relative importance of spend on pay The following table compares the remuneration paid to the directors with aggregate distributions to shareholders in the year to 31 January 2022 and the prior year. This disclosure is a statutory requirement. However, the directors consider that this comparison is not meaningful as (a) the Company has no employees, and (b) its objective is to provide shareholders with long-term capital growth, and share buybacks and the dividend form only a small part of total shareholders’ returns. Components of remuneration package Directors’ remuneration Shareholder distributions Dividends paid Share buybacks Total distributions to shareholders Remuneration in the year (audited) Name Jane Tufnell1 Lucinda Riches2 Alastair Bruce Gerhard Fusenig3,4 Sandra Pajarola4 David Warnock5 Jeremy Tigue6 Total Year ended 31 January 2022 £’000 Year ended 31 January 2021 £’000 262 251 18,500 2,968 21,197 15,822 775 16,597 Fees Taxable benefits 2022 £’000 2021 £’000 2022 £’000 2021 £’000 Total 2022 £’000 2021 £’000 65 17 52 42 42 42 – 260 53 41 44 41 41 7 24 251 – – – 2 2 – – 4 – – – – – – – – 65 17 52 44 44 42 – 264 53 41 44 41 41 7 24 251 Change in annual fee over years ended 31 January 2022 % 22% (60)%2 19% 7% 7% 504%5 N/A 2021 % 61%1 0% 0% 116%3 (7)% N/A (59)%6 1 Joined the Board in June 2019 and served for part of the year ended 31 January 2020. 2 Retired from the Board in June 2021 and served for part of the year ended 31 January 2022. 3 Joined the Board in September 2019 and served for part of the year ended 31 January 2020. 4 Gerhard Fusenig and Sandra Pajarola are resident in Switzerland and the Company has agreed to pay for their costs of travel to London (including appropriate accommodation) to attend meetings of the Board. 5 Joined the Board in December 2020 and served for part of the year ended 31 January 2021. 6 Retired from the Board in June 2020 and served for part of the year ended 31 January 2021. 58 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Directors’ shareholdings and share interests (audited) The beneficial interests of the directors in the shares of the Company are shown below. There is no requirement for the directors to own securities of the Company. Save as disclosed below, no director had any notifiable interest in the securities of the Company. Name Jane Tufnell Alastair Bruce Gerhard Fusenig Sandra Pajarola David Warnock Total Year ended 31 January 2022 Number of shares Year ended 31 January 2021 Number of shares 28,025 25,000 15,000 25,000 20,000 113,025 10,000 19,000 11,000 25,000 20,000 85,000 % 98.56 1.44 – % 98.51 1.49 – Note that Lucinda Riches, who retired from the Board on 21 June 2021, held 20,000 shares at the date of her retirement and as at 31 January 2022. There has been no change in the number of shares held by the existing directors since the year end. Statement of shareholder voting The Remuneration Policy was last approved at the Annual General Meeting on 17 June 2020, with the following proxy votes cast: Votes For Against Withheld Number 19,855,520 290,607 229,378 At the Annual General Meeting held on 21 June 2021, a resolution to approve the Directors’ Remuneration Report for the year ended 31 January 2021 was passed with the following proxy votes cast: Votes For Against Withheld Number 21,370,636 322,805 315,097 The Board does not consider the numbers of votes against these resolutions to be significant. Resolution to approve Directors’ Remuneration Report A resolution to approve the Remuneration Report for the year ended 31 January 2022 will be put to the members at the forthcoming Annual General Meeting. On behalf of the Board: Jane Tufnell Chair 11 May 2022 ICG Enterprise Trust Plc Annual Report and Accounts 2022 59 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONReport of the Audit Committee The primary role of the Committee is to review the financial statements, the effectiveness and scope of the external audit, and the risks to which the Company is exposed and the controls that mitigate those risks. ALASTAIR BRUCE Chair of the Committee Key responsibilities Reviewing the interim and annual financial statements, the effectiveness and scope of the external audit, the risks to which the Company is exposed and mitigating controls, and compliance with regulatory and financial reporting requirements. Committee members Alastair Bruce (Chair of the Committee) Gerhard Fusenig Sandra Pajarola Jane Tufnell David Warnock Committee activities 4 meetings held in the financial year; all were quorate Oversight of audit conducted by the Company’s auditors Continued review and scrutiny of valuations 1 The FRC have asked us to make clear the limitations of its review are as follows: The FRC’s review is based solely on the Annual Report and Accounts and does not benefit from detailed knowledge of the business or an understanding of the underlying transactions entered into. The FRC’s letter provides no assurance that the Annual Report and Accounts are correct in all material respects; the FRC’s role is not to verify the information provided but to consider compliance with reporting requirements. 60 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Introduction The Audit Committee is comprised of five non-executive directors: Alastair Bruce, Gerhard Fusenig, Sandra Pajarola, Jane Tufnell and David Warnock. All of the members served throughout the year; in addition, Lucinda Riches served on the Committee until her retirement in June. As set out on pages 46 and 47, the members of the Committee have a range of recent and relevant financial experience. They also have relevant experience in the sector in which the Company operates. The Committee operates within written terms of reference, which are available within the Corporate governance section of the Company’s website, clearly setting out its authority and duties. The primary role of the Committee is to review the interim and annual financial statements, the effectiveness and scope of the external audit, the risks to which the Company is exposed and mitigating controls, and compliance with regulatory and financial reporting requirements. The Committee also provides advice to the Board on whether the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable. The Committee meets at least three times a year. A quorum is any two of the members of the Committee but full attendance at each meeting is strongly encouraged. Four meetings were held in the financial year, and all were quorate. The Company’s auditors, Ernst & Young LLP (‘EY’), attended all meetings. The Committee also has direct access to the auditors as necessary at other times and the opportunity to meet the auditors without the Manager being present. The main matters discussed at these meetings were the annual plan of the auditors, the report of the auditors following their audit, the effectiveness of the audit process and the independence of the auditors, the review of the Company’s internal controls, the annual and interim financial statements and the Company’s risk management framework and principal risks. SIGNIFICANT JUDGEMENTS IN RELATION TO THE FINANCIAL STATEMENTS Valuation of the investment Portfolio In its review of the financial statements, the Committee considers whether the investment Portfolio is fairly valued. The valuation of the Portfolio is predominantly based on third- party managers’ valuations. Before the year end, the Committee discussed the valuation process in detail with the Manager and reviewed the plan of the external auditors to ensure that it was appropriately designed to provide assurance over the valuation of the Portfolio. This has been an area of heightened consideration for the last two years as a result of the COVID-19 pandemic, which led to considerable uncertainty in valuations across the market during the prior financial year. The Committee has been satisfied with the process established by the Manager. After the year end, the Manager reported the results of the valuation process, including the sources of valuation information and the methodologies used. The auditors separately reported the results of their audit work to the Committee. The Committee concluded that the valuation process had been properly carried out and that the investment Portfolio had been fairly valued in accordance with IFRS, in line with International Private Equity and Venture Capital Valuation Guidelines. Going concern and viability In order to support the Board in determining that it is appropriate to continue to adopt the going concern basis of preparation of the Company’s financial statements, the Committee has challenged and assessed the key assumptions underpinning that decision. This included: • an assessment of the Company’s business activities, as set out in the Chair’s statement on pages 10 and 11 and the Manager’s review on pages 12 to 19; • the Company’s principal risks and their mitigants, as noted on pages 40 to 43; and • the Company’s ability to manage its liquidity and overcommitment levels over the period of 12 months and longer from the date of this report, incorporating the Company’s balance sheet and cash flow projections provided by the Manager. These projections included scenarios with varying levels of Portfolio gains and losses, fund drawdowns and realisations, availability of the credit facility, exchange rates, and possible remedial action that the Company could undertake if required in the event of significant Portfolio declines and/ or reductions in liquidity. Further details around liquidity risk and overcommitment risk are detailed on page 86 within the notes to the financial statements. Accordingly, the Committee was satisfied that the ‘going concern’ basis of accounting remained appropriate for the Company. OTHER MATTERS During the year the FRC1 advised the Company that they had carried out a review of the Annual Report and Accounts for the year ended 31 January 2021. The Committee has overseen the review and implementation of their recommendations, as appropriate. The FRC had no further queries. Auditing standards require the auditors to identify and consider the risks of material misstatement, including fraud in revenue recognition and of management override of internal controls. The auditors also focus on a number of key audit matters that, in the auditor’s professional judgement, were of most significance in the audit of the financial statements of the current period. Following a thorough review, and discussion with the Manager and the auditors, the Committee has advised the Board that the Annual Report and Accounts for the year ended 31 January 2022, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company’s position and performance, business model and strategy. INTERNAL CONTROLS AND NEED FOR AN INTERNAL AUDIT FUNCTION The Board has overall responsibility for the Company’s systems of internal controls and for reviewing their effectiveness. The purpose of the controls is to ensure that the assets of the Company are safeguarded, proper accounting records are maintained and the financial information used within the business and for publication is reliable. The Committee regularly reviews, identifies and evaluates the risks taken by the Company to allow them to be appropriately managed. All of the Company’s day-to-day management functions are delegated to the Manager which has its own internal control and risk monitoring arrangements. The Committee makes a regular assessment of these arrangements, with reference to the Company’s risk matrix. The Committee also reviewed a Statement of Internal Controls for the year to 31 January 2022 which sets out the key internal controls over the administration of the Company’s investments and received a report, based on agreed-upon procedures, from the Manager’s internal audit function. In accordance with the Alternative Investment Fund Managers Directive (‘the Directive’), the Company has appointed Aztec Financial Services (UK) Limited (‘the Depositary’) as depositary. The Depositary’s responsibilities include the monitoring of the cash flows of the Company, the safekeeping of the Company’s assets, and the general oversight of the Company including its compliance with its investment policy. The Audit Committee has reviewed the Depositary’s reports for the period from 1 February 2021 to 31 January 2022, that set out the testing and procedures carried out by the Depositary to satisfy itself that it is fulfilling its obligations, and that the Company was operating in accordance with the Directive. The reports did not identify any issues. The Committee considers, therefore, that an internal audit function specific to the Company is unnecessary. AUDIT INDEPENDENCE AND EFFECTIVENESS EY were appointed as auditors for the year ended 31 January 2022 at the Annual General Meeting in 2021. The Company has complied with the terms of the September 2014 Competition and Markets Authority Order, including in respect of audit tendering. The Audit Committee has reviewed the provision of non-audit services and believes them to be cost-effective and not an impediment to the auditor’s objectivity and independence. Details of the total fees paid to EY by the Company are set out in Note 4 to the financial statements. In the year ended 31 January 2022, £39k (2021: £34k) in respect of non-audit services was payable to the auditors for agreed upon procedures. It has been agreed that all non-audit work to be carried out by the external auditors must be approved in advance by the Audit Committee, and in line with the latest guidelines for the provision of non-audit services by the Company’s auditors. The Committee reviews the performance of the auditors each year. The Committee considers a range of factors including the quality of service, their expertise and the level of audit fee. The 2022 year-end audit was EY’s third as auditors and oversight of their work has been a key focus of the Committee during the year. The Committee has been pleased with the work undertaken by both the Manager and EY as the financial cycle somewhat normalised following the challenging circumstances of the pandemic. We look forward to continuing to build on the relationship with EY and the fresh insights that they will bring to the Committee. The Committee accordingly recommends that Ernst & Young LLP be appointed auditors for the year ending 31 January 2023. I would be pleased to discuss the work of the Committee with any shareholder. Alastair Bruce Chair of the Audit Committee 11 May 2022 ICG Enterprise Trust Plc Annual Report and Accounts 2022 61 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Additional disclosures required by the Alternative Investment Fund Managers Directive (unaudited) FAIR TREATMENT OF SHAREHOLDERS The Manager is governed by a board consisting of both non-executive and executive directors which oversees and manages the ICG Group of which the Manager is part. ICG has a number of committees that assist in this regard, together with a risk function that through a risk framework assists in the identification, control and mitigation of the ICG Group’s risks. This includes, but is not limited to, the fair treatment of the ICG Group’s regulatory clients, fund investors and corporate investors. Details of ICG’s governance and risk framework can be found in ICG’s annual report which is available on request or at www.icgam.com. RISK PROFILE AND RISK MANAGEMENT The risks and uncertainties facing the Company are regularly reviewed by the Board, the Audit Committee and the Manager. The principal risks faced by the Company and the approach to managing those risks are set out in Principal risks and uncertainties (pages 40 to 43). The sensitivity of the Company to market, credit and investment, and capital risk is discussed in Note 17 of the financial statements (page 86). The risk limits currently in place in respect of the diversification of the Portfolio and credit risk are set out in the Investment policy (page 55). MATERIAL CHANGES There have been no material changes in relation to the matters described in Article 23 of the Directive. REMUNERATION Under the AIFMD, we are required to make disclosures relating to remuneration of certain employees working for the Manager, which acted as manager of the Company throughout the year ended 31 January 2022. Amount of remuneration paid The relevant disclosures are available on the Company’s website. Co-investment Incentive Scheme The incentive paid by the Company during the year ended 31 January 2022 is disclosed in Note 9 to the financial statements. Remuneration and incentivisation policies and practices The overriding principle governing the Manager’s remuneration decisions is that awards, in particular of variable remuneration, do not encourage risk taking which is inconsistent with the investment objectives (and therefore risk profiles) of the funds managed by the Manager. Remuneration consists of salary, bonus and co-investment incentives. The co-investment incentive arrangements are intended to closely align the interests of shareholders and the Manager – under these arrangements, payments may only be made when investment profits have been realised in cash. The operation of these arrangements is set out in the Report of the Directors on pages 52 to 54. The Manager has a remuneration committee which takes remuneration decisions. The committee takes into account the short and long-term performance of the Manager, of the funds managed by the Manager, and of individuals. The Company is an alternative investment fund (‘AIF’) for the purposes of the Alternative Investment Fund Managers Directive (Directive 2011/61/ EU) (‘AIFMD’) and the Manager was appointed as its alternative investment fund manager (‘AIFM’) for the purposes of the AIFMD. The Directive requires certain disclosures to be made in the Annual Report of the Company. Many of these disclosures are included in other sections of the Annual Report and Accounts, principally the Strategic Report (pages 1 to 43), Governance (pages 44 to 63) and Financial Statements (pages 64 to 90). This section completes the disclosures required by the Directive. ASSETS SUBJECT TO SPECIAL ARRANGEMENTS The Company holds no assets subject to special arrangements arising from their illiquid nature which are unusual within the context of the fund. LEVERAGE The Company has no borrowings and therefore is not currently levered. The Company will not employ leverage in excess of 30% of its gross asset value. PROFESSIONAL LIABILITY OF THE MANAGER In accordance with the requirements of the Directive, the Manager holds additional capital to cover potential professional liability risks. In addition, the Manager holds professional indemnity insurance. REDEMPTION RIGHTS The shares of the Company are listed on the London Stock Exchange. Shareholders may buy and sell shares on that market. As the Company is closed ended, shareholders do not have the right to redeem their investment. 62 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Statement of Directors’ responsibilities The directors are also responsible for safeguarding the assets of the Company and for taking reasonable steps for the prevention and detection of fraud and other irregularities. The directors are responsible for the maintenance and integrity of the Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Having taken advice from the Audit Committee, the directors consider that the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company’s position and performance, business model and strategy. Each of the directors, whose names and functions are listed on pages 46 and 47, confirm that, to the best of their knowledge: • the financial statements, which have been prepared in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006, give a true and fair view of the assets, liabilities, financial position and profit of the Company; and • the Strategic Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces. On behalf of the Board: Jane Tufnell Chair 11 May 2022 The directors are responsible for preparing the Annual Report, the Directors’ Remuneration Report and the financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare financial statements for each financial year. Accordingly, the directors have prepared the financial statements in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006. Company law also requires that the directors do not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for the relevant period. 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 International Accounting Standards in conformity with the requirements of the Companies Act 2006 have been followed, subject to any material departures disclosed and explained in the financial statements; and • prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements and the Directors’ Remuneration Report comply with the Companies Act 2006 and, as regards the Company’s financial statements, International Accounting Standards in conformity with the requirements of Companies Act 2006 and the Statement of Recommended Practice (‘SORP’) for investment trusts issued by the Association of Investment Companies in April 2021. ICG Enterprise Trust Plc Annual Report and Accounts 2022 63 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONIndependent auditor’s report to the members of ICG Enterprise Trust Plc OPINION We have audited the financial statements of ICG Enterprise Trust Plc (‘the Company’) for the year ended 31 January 2022 which comprise the Income Statement, Balance Sheet, Cash Flow Statement and Statement of Changes in Equity and the related notes 1 to 19, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards. In our opinion, the financial statements: • give a true and fair view of the Company’s affairs as at 31 January 2022 and of its profit for the year then ended; • have been properly prepared in accordance with UK-adopted international accounting standards; and • have been prepared in accordance with the requirements of the Companies Act 2006. BASIS FOR OPINION We conducted our audit in accordance with International Standards on Auditing (UK) (‘ISAs (UK)’) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. INDEPENDENCE We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Company and we remain independent of the Company in conducting the audit. CONCLUSIONS RELATING TO GOING CONCERN In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the Directors’ assessment of the Company’s ability to continue to adopt the going concern basis of accounting included the following procedures: • We made enquiries of the Audit Committee and the Manager to determine whether, in their opinion, they had any knowledge of events or conditions beyond the period of the Directors’ assessment that may cast significant doubt on the Company’s ability to continue as a going concern. • We obtained the Directors’ going concern assessment, including the impact of the COVID-19 pandemic, and validated that the assessment covers a period of at least 12 months from 11 May 2022, the date of approval of the financial statements. • We obtained the forecasts prepared by ICG Alternative Investment Limited (‘the Manager’), estimating future investment portfolio valuation movements and cash flows, underpinning the Directors’ assessment of going concern. We challenged the sensitivities and assumptions used in the forecasts, including comparing assumptions of future cash flows and portfolio valuation movements to historical data. • We obtained the stress testing and reverse stress testing performed by the Manager and challenged the appropriateness and severity of stresses applied, through comparison to market and historical data. We validated the standing data used by agreeing this to supporting documentation. • We made enquiries of the Audit Committee and the Manager to determine whether, in their opinion, there is any material uncertainty regarding the Company’s ability to pay liabilities and commitments as they fall due over the period of 12 months from the date of approval of the financial statements, and challenged this assessment. • We obtained the legal agreements to validate the existence of the multi-currency revolving credit facility entered into by the Company during the year and agreed key terms to the assumptions and calculations in the going concern assessment and supporting stress testing. We recalculated the relevant covenants for each quarter-end in the going concern assessment period based on these key terms. • We validated that the disclosures made in the Annual Report and Accounts regarding the Company’s ability to continue as a going concern are consistent with our understanding of the business and with the assumptions and calculations which underpin the Directors’ assessment of going concern. 64 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company’s ability to continue as a going concern for a period of at least 12 months from 11 May 2022, when the financial statements are authorised for issue. In relation to the Company’s reporting on how they have applied the UK Corporate Governance Code, we have nothing material to add or draw attention to in relation to the Directors’ statement in the financial statements about whether the Directors considered it appropriate to adopt the going concern basis of accounting. Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Company’s ability to continue as a going concern. OVERVIEW OF OUR AUDIT APPROACH Key audit matters • Risk of incorrect valuation of unquoted investments. • Risk of inaccurate recognition of realised and change in unrealised gains/(losses) on unquoted investments. Materiality • Overall materiality of £11.58m which represents 1% of net assets. AN OVERVIEW OF THE SCOPE OF OUR AUDIT Tailoring the scope Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determine our audit scope for the Company. This enables us to form an opinion on the financial statements. We take into account size, risk profile, the organisation of the Company and effectiveness of controls, including controls and changes in the business environment when assessing the level of work to be performed. All audit work was performed directly by the audit engagement team. CLIMATE CHANGE There has been increasing interest from stakeholders as to how climate change will impact companies. The Company has determined that the impact of climate-related transition risks, driven in particular by abrupt shifts in the political and technological landscape, may impact the value of the Company’s Portfolio. This is explained on page 41 in the Principal risks and uncertainties section of the Strategic Report, which forms part of the ‘Other information’, rather than the audited financial statements. Our procedures on these disclosures therefore consisted solely of considering whether they are materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appear to be materially misstated. Our audit effort in considering climate change was focused on the adequacy of the Company’s disclosures in the financial statements as set out in note 1(a) and the conclusion that there was no further impact of climate change to be taken into account as the investments are valued based on market pricing as at the year-end as required by IFRS. We also challenged the Directors’ considerations of climate change in their assessment of going concern and viability and associated disclosures. KEY AUDIT MATTERS Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters. ICG Enterprise Trust Plc Annual Report and Accounts 2022 65 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONIndependent auditor’s report to the members of ICG Enterprise Trust Plc continued KEY OBSERVATIONS COMMUNICATED TO THE AUDIT COMMITTEE The results of our procedures are: We identified no material misstatements in relation to the risk of incorrect valuation of unquoted investments. RISK OUR RESPONSE TO THE RISK Risk of incorrect valuation of unquoted investments (2022: £1,123.7m, 2021: £871.9m) Refer to the Audit Committee Report (pages 60 and 61); Accounting policies (pages 74 to 77); and notes 10 and 17 of the Financial Statements (pages 81 and 86). The unquoted investment portfolio is material to the financial statements and consists of illiquid private equity fund investments and direct co-investments into private companies. The Company also has six subsidiary undertakings, held at fair value under IFRS 10, which invest into the same unquoted investments. The valuations of unquoted investments do not have observable inputs that reflect quoted prices in active markets and are therefore subjective, increasing the likelihood of error. The net assets of each investment are provided to the Company by the fund managers or sponsors of the investee companies and any necessary adjustments are made by the Administrator, for example cash flow adjustments for drawdowns and distributions between the date of the valuation provided and the year-end date of the Company. The valuations are then reviewed by the Manager and the Directors. As of 31 January 2022, the Company’s investment portfolio consisted of private equity fund investments of £124.9m (2021: £442.7m), direct co-investments of £66.3m (2021: £161.7m) and subsidiary undertakings of £932.5m (2021: £267.6m). We performed the following procedures: We obtained an understanding of and evaluated the design and implementation of processes and controls around the unquoted investment valuations by performing a walkthrough. We obtained the valuation policy applied by the Company and validated compliance with the International Private Equity and Venture Capital Guidelines December 2018. For a sample of unquoted investments held within the Company and its subsidiaries, we performed the following procedures to gain assurance over the valuation: • we independently obtained the most recently available third-party valuations and agreed the valuations to the value per the accounting records; • where the most recently available third-party valuation was not at the reporting date, we obtained details of the cash flow adjustments made to fair value by management, in addition to the underlying quoted adjustments on a look through basis, and agreed these to supporting documentation and bank statements; and • we verified the reasonableness of all foreign exchange rates used by comparison to an independent source. Subsequent to the finalisation of the investment valuations, we obtained updated capital account statements and other financial information relevant to the valuation of the unquoted investments received by the Manager, to establish if any material valuation differences arose. We challenged the Manager’s procedures to determine whether events and circumstances that occurred between the date of the third-party valuations provided and the reporting date of the Company had an impact on the valuation of the investment portfolio. We reviewed the minutes of the Valuation Committee meetings and held discussions with key personnel at the Manager to discuss the performance of the portfolio for the year. We performed the following procedures to gain assurance over the reliability of the unaudited capital account statements: • for a sample of investments where the valuation was based on unaudited capital account statements, we assessed their reliability by comparing the Net Asset Value (‘NAV’) per the latest audited financial statements to the NAV per the unaudited capital account statement for the same quarter; and • we obtained a sample of relevant underlying audited financial statements, inspecting the GAAP applied and accounting policies on key areas impacting the NAV and comparing these to IFRS. We ensured that the auditor was registered with the appropriate local accounting body. 66 ICG Enterprise Trust Plc Annual Report and Accounts 2022 KEY OBSERVATIONS COMMUNICATED TO THE AUDIT COMMITTEE The results of our procedures are: We are satisfied that there are no material misstatements in relation to the risk of inaccurate recognition of realised and change in unrealised gains/(losses) on unquoted investments. RISK OUR RESPONSE TO THE RISK We performed the following procedures: We obtained an understanding of and evaluated the design and implementation of the processes and controls around the recognition of realised and change in unrealised gains/(losses) by performing a walkthrough. To validate the inputs into the manual calculation: • we recalculated the change in unrealised gain/(loss) for a sample of investments based on the fair value of the investments audited as part of our investments testing; • we agreed a sample of purchases and sales of investments during the year to call and distribution notices, or to secondary sales documentation, and bank statements; and • we agreed the inputs in the realised gains/(losses) calculation for a sample of investments to independently obtained capital account statements. We performed an assessment for all gains/(losses) on whether all gains or losses on unquoted investments are deemed as realised or unrealised, based on the Company’s accounting policy, and agreed this to the Company’s assessment. We verified that the calculation for identifying realised gains and losses was in line with the documented accounting policy in the Annual Report and Accounts and validated that the policy is in compliance with IFRS 9. To address the risk of management override, we tested the appropriateness of journal entries and other adjustments made in the recording of gains/(losses) on fair value. Risk of inaccurate recognition of realised (2022: (£12.7m), 2021: (£17.1m)) and change in unrealised (2022: £162.3m, 2021: £165.4m) gains/ (losses) on unquoted investments Refer to the Accounting policies (pages 74 to 77); and note 10 of the Financial Statements (page 81). Gains or losses on investments originate from the capital distributions and capital gains for investments during the year. Total gains are calculated as the difference between the movement in cost against carrying value during the year and the net proceeds, after deducting cost adjustments incidental to the sales. There is a manual calculation performed by the Manager for recognising gains and losses as realised or unrealised, based on the Company’s revenue recognition accounting policy. There is a risk that the manual calculations of realised and change in unrealised gains and losses on unquoted investments are incorrectly calculated by the Manager, which could lead to the disclosures regarding the capital element of the Income Statement and the Statement of Changes in Equity being materially misstated. The realised gains and losses recorded by the Company during the year could directly affect the dividend which is paid to shareholders and thus the perceived performance and share price of the Company. There could therefore be an incentive to misstate the realised gains to manipulate the dividend payment. For the year ended 31 January 2022, the Company reported £162.3m (2021: £165.4m) of unrealised gains and (£12.7m) of realised losses (2021: (£17.1m) of realised losses) on the portfolio of unquoted investments. ICG Enterprise Trust Plc Annual Report and Accounts 2022 67 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONIndependent auditor’s report to the members of ICG Enterprise Trust Plc continued OUR APPLICATION OF MATERIALITY We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and in forming our audit opinion. Materiality The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures. We determined materiality for the Company to be £11.58m (2021: £9.52m), which is 1% (2021: 1%) of net assets. We believe that net assets provide us with materiality aligned to the key measurement of the Company’s performance. There have been no changes to the materiality basis from the prior year. Performance materiality The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality. On the basis of our risk assessments, together with our assessment of the Company’s overall control environment, our judgement was that performance materiality was 50% (2021: 75%) of our planning materiality, namely £5.78m (2021: £7.14m). We have set performance materiality at this percentage due to the corrected and uncorrected misstatements identified in the prior year audit, some of which were above our Planning Materiality. We considered that the misstatements identified imply that there is a higher likelihood of misstatement in the current year audit, and we therefore reduced our performance materiality. Reporting threshold An amount below which identified misstatements are considered as being clearly trivial. We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of £0.6m (2021: £0.5m), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant qualitative considerations in forming our opinion. OTHER INFORMATION The other information comprises the information included in the Annual Report other than the financial statements and our auditor’s report thereon. The Directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact. We have nothing to report in this regard. OPINIONS ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006 In our opinion the part of the Directors’ Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006. In our opinion, based on the work undertaken in the course of the audit: • the information given in the Strategic Report and the Directors’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and • the Strategic Report and Directors’ Report have been prepared in accordance with applicable legal requirements. MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or Directors’ Report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: • adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; • the financial statements and the part of the Directors’ Remuneration Report to be audited are not in agreement with the accounting records and returns; • certain disclosures of Directors’ remuneration specified by law are not made; or • we have not received all the information and explanations we require for our audit. CORPORATE GOVERNANCE STATEMENT The Listing Rules require us to review the Directors’ statement in relation to going concern, longer-term viability and that part of the Corporate Governance Statement relating to the Company’s compliance with the provisions of the UK Corporate Governance Code specified for our review. Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate Governance Statement is materially consistent with the financial statements or our knowledge obtained during the audit: • Directors’ statement with regards to the appropriateness of adopting the going concern basis of accounting set out on page 51; • Directors’ explanation as to its assessment of the Company’s prospects, the period this assessment covers and why the period is appropriate set out on page 51; 68 ICG Enterprise Trust Plc Annual Report and Accounts 2022  • Directors’ statement on fair, balanced and understandable set out on page 63; • Board’s confirmation that it has carried out a robust assessment of the emerging and principal risks set out on pages 38 to 43; • The section of the Annual Report that describes the review of effectiveness of risk management and internal control systems set out on page 61; and, • The section describing the work of the Audit Committee set out on page 60. RESPONSIBILITIES OF DIRECTORS As explained more fully in the Directors’ responsibilities statement set out on page 63, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so. AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the Company and management. • We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant are those that relate to the reporting framework (UK-adopted international accounting standards, the Companies Act 2006, the Listing Rules, the UK Corporate Governance Code, Section 1158 of the Corporation Tax Act 2010, The Companies (Miscellaneous Reporting) Regulations 2018, and The Statement of Recommended Practice for the Financial Statements of Investment Trust Companies as issued by the Association of Investment Companies). • We understood how the Company is complying with those frameworks through discussions with members of the Manager and the Non-Executive Directors including the Chairman of the Audit Committee, in addition to the review of board minutes, committee minutes, and papers provided to the Audit Committee. • We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur by considering the key risks impacting the financial statements. We identified fraud and management override risks in relation to the inaccurate recognition of realised and change in unrealised gains/(losses) on unquoted investments. Our audit procedures stated above in the ‘Key audit matters section’ of this auditor’s report were performed to address this identified fraud risk. • Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved review of the reporting to the Directors with respect to the application of the documented policies and procedures and review of the financial statements to ensure compliance with the reporting requirements of the Company. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. OTHER MATTERS WE ARE REQUIRED TO ADDRESS • Following the recommendation from the Audit Committee, we were appointed by the Company at its Annual General Meeting on 27 June 2019 to audit the financial statements for the year ended 31 January 2020 and subsequent financial periods. The period of total uninterrupted engagement including previous renewals and reappointments is three years, covering the years ended 31 January 2020 to 31 January 2022. • The audit opinion is consistent with the additional report to the Audit Committee. USE OF OUR REPORT This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Denise Davidson (Senior statutory auditor) for and on behalf of Ernst & Young LLP Statutory Auditors London 11 May 2022 ICG Enterprise Trust Plc Annual Report and Accounts 2022 69 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Income statement Year to 31 January 2022 Year to 31 January 2021 Notes Revenue return £’000 Capital return £’000 Total £’000 Revenue return £’000 Capital return £’000 Total £’000 Investment returns Income, gains and losses on investments 2, 10 5,501 240,030 245,531 6,523 184,071 190,594 Deposit interest Other income Foreign exchange gains and losses Expenses Investment management charges Other expenses Profit before tax Taxation Profit for the period Attributable to: Equity shareholders 2 2 3 4 6 2 – – – – 2 – (980) (980) 26 45 – – – 26 45 (799) (799) 5,503 239,050 244,553 6,594 183,272 189,866 (1,342) (2,383) (3,725) (12,075) (2,263) (14,338) (13,417) (4,646) (18,063) 1,778 – 224,712 226,490 – – 1,778 224,712 226,490 (2,682) (2,129) (4,811) 1,783 – 1,783 (8,046) (1,941) (9,987) (10,728) (4,070) (14,798) 173,285 175,068 – – 173,285 175,068 1,778 224,712 226,490 1,783 173,285 175,068 Basic and diluted earnings per share 7 329.97p 254.53p The columns headed ‘Total’ represent the income statement for the relevant financial years and the columns headed ‘Revenue return’ and ‘Capital return’ are supplementary information in line with guidance published by the AIC. There is no Other Comprehensive Income. The notes on pages 74 to 90 form an integral part of the financial statements. 70 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Balance sheet Non-current assets Investments held at fair value Current assets Cash and cash equivalents Receivables Current liabilities Payables Net current assets Total assets less current liabilities Capital and reserves Share capital Capital redemption reserve Share premium Capital reserve Revenue reserve Total equity 31 January 2022 £’000 31 January 2021 £’000 Notes 9, 10, 17 1,123,747 907,562 11 12 41,328 2,205 43,533 45,143 162 45,305 13 9,303 851 34,230 1,157,977 44,454 952,016 14 7,292 2,112 12,936 1,135,637 – 7,292 2,112 12,936 929,676 – 1,157,977 952,016 Net asset value per share (basic and diluted) 15 1,690.1p 1,384.4p The notes on pages 74 to 90 form an integral part of the financial statements. The financial statements on pages 70 to 90 were approved by the Board of Directors on 11 May 2022 and signed on its behalf by: Jane Tufnell Director 11 May 2022 Alastair Bruce Director 11 May 2022 ICG Enterprise Trust Plc Annual Report and Accounts 2022 71 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Cash flow statement Operating activities Sale of portfolio investments Purchase of portfolio investments Net cash flows to subsidiary investments Interest income received from portfolio investments Dividend income received from portfolio investments Other income received Investment management charges paid Other expenses paid Net cash inflow/(outflow) from operating activities Financing activities Bank facility fee Interest paid Credit facility utilised Credit facility repaid Purchase of shares into treasury Equity dividends paid Net cash outflow from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Net increase/(decrease) in cash and cash equivalents Effect of changes in foreign exchange rates Cash and cash equivalents at end of year The notes on pages 74 to 90 form an integral part of the financial statements. Year to 31 January 2022 £’000 Year to 31 January 2021 £’000 Notes 100,982 (75,125) (2,524) 3,647 1,854 2 (6,207) (1,570) 21,059 (3,318) (50) – – (2,679) (17,849) (23,896) (2,837) – 45,143 (2,837) (978) 41,328 147,545 (86,134) (6,486) 1,231 5,445 71 (10,334) (1,419) 49,919 (1,410) (440) 40,000 (40,000) (775) (15,822) (18,447) 31,472 14,470 31,472 (799) 45,143 8 11 11 72 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Statement of changes in equity Share capital £’000 Capital redemption reserve £’000 Share premium £’000 Realised capital reserve £’000 Unrealised capital reserve £’000 Revenue reserve £’000 Total shareholders’ equity £’000 Year to 31 January 2022 Opening balance at 1 February 2021 7,292 2,112 12,936 442,063 487,613 – 952,016 Profit for the year and total comprehensive income Dividends paid or approved Purchase of shares into treasury – – – – – – – – – 59,554 (16,071) (2,679) 165,158 – – Closing balance at 31 January 2022 7,292 2,112 12,936 482,867 652,770 1,778 (1,778) – – 226,490 (17,849) (2,679) 1,157,977 Share capital £’000 Capital redemption reserve £’000 Share premium £’000 Realised capital reserve £’000 Unrealised capital reserve £’000 Revenue reserve £’000 Total shareholders’ equity £’000 Year to 31 January 2021 Opening balance at 1 February 2020 7,292 2,112 12,936 356,393 414,812 – 793,545 Profit for the year and total comprehensive income Dividends paid or approved Purchase of shares into treasury – – – – – – – – – 100,484 (14,039) (775) 72,801 – – Closing balance at 31 January 2021 7,292 2,112 12,936 442,063 487,613 1,783 (1,783) – – 175,068 (15,822) (775) 952,016 The notes on pages 74 to 90 form an integral part of the financial statements. ICG Enterprise Trust Plc Annual Report and Accounts 2022 73 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONNotes to the financial statements 1 ACCOUNTING POLICIES General information These financial statements relate to ICG Enterprise Trust Plc (‘the Company’). ICG Enterprise Trust Plc is registered in England and Wales and is incorporated in the United Kingdom. The Company is domiciled in the United Kingdom and its registered office is Procession House, 55 Ludgate Hill, London EC4M 7JW. The Company’s objective is to provide long-term growth by investing in private companies managed by leading private equity managers. (a) Basis of preparation The financial information for the year ended 31 January 2022 has been prepared in accordance with International Accounting Standards (‘IAS’) in conformity with the requirements of the Companies Act 2006 and the Statement of Recommended Practice (‘SORP’) for investment trusts issued by the Association of Investment Companies in April 2021. IAS comprises standards and interpretations approved by the International Accounting Standards Board (‘IASB’) and the IFRS Interpretations Committee. These financial statements have been prepared on a going concern basis and on the historical cost basis of accounting, modified for the revaluation of certain assets at fair value. The directors have concluded that the preparation of the financial statements on a going concern basis continues to be appropriate; the directors’ assessment is further detailed in the Report of the Directors on pages 52 to 54. Going concern In assessing the appropriateness of continuing to adopt the going concern basis of accounting, the Board has assessed the financial position and prospects of the Company over the next 12 months. The Company’s business activities, together with factors likely to affect its future development, performance, position and cash flows, are set out in the Chair’s statement on pages 10 and 11, and the Manager’s review on pages 12 to 19. As part of this review, the Board assessed the potential impact of principal risks and the COVID-19 pandemic on the Company’s business activities, the Company’s cash position, the availability of the Company’s credit facility and compliance with its covenants, and the Company’s cash flow projections. Based on this assessment, the Board expects that the Company will be able to continue in operation and meet its liabilities as they fall due until, at least, 31 May 2023, a period of more than 12 months from the signing of the financial statements. Therefore it is appropriate to continue to adopt the going concern basis of preparation of the Company’s financial statements. Climate change In preparing the financial statements, the Directors have considered the impact of climate change, particularly in the context of the climate change risks identified in the Principal risks and uncertainties section of the Strategic Report and the impact of climate change risk on the valuation of investments. These considerations did not have a material impact on the financial reporting judgements and estimates in the current year, nor were they expected to have a significant impact on the Group’s going concern or viability. Accounting policies The principal accounting policies adopted are set out below. These policies have been applied consistently throughout the current and prior year. In order to reflect the activities of an investment trust company, supplementary information which analyses the income statement between items of revenue and capital nature has been presented alongside the income statement. In analysing total income between capital and revenue returns, the directors have followed the guidance contained in the SORP as follows: • Capital gains and losses on investments sold and on investments held arising on the revaluation or disposal of investments classified as held at fair value through profit or loss should be shown in the capital column of the income statement. • Returns on any share or debt security for a fixed amount (whether in respect of dividends, interest or otherwise) should be shown in the revenue column of the income statement. • The Board should determine whether the indirect costs of generating capital gains should also be shown in the capital column of the income statement. If the Board decides that this should be so, the management fee should be allocated between revenue and capital in accordance with the Board’s expected long-term split of returns, and other expenses should be charged to capital only to the extent that a clear connection with the maintenance or enhancement of the value of investments can be demonstrated. The accounting policy regarding the allocation of expenses is set out in note 1(i). During the year the Company changed the allocation of expenses, see note 1(i) and note 3. In accordance with IFRS 10 (amended), the Company is deemed to be an investment entity on the basis that: (a) it obtains funds from one or more investors for the purpose of providing investors with investment management services; (b) it commits to its investors that its business purpose is to invest funds for both returns from capital appreciation and investment income; and (c) it measures and evaluates the performance of substantially all of its investments on a fair value basis. As a result, the Company’s controlled structured entities (‘subsidiaries’) are deemed to be investment entities and are included in subsidiary investments classified as held at fair value through profit and loss. The Financial Conduct Authority and the Bank of England have imposed significant interest rate benchmarking reform with LIBOR publication ceasing on 31 December 2021. The impact on the Company was immaterial. 74 ICG Enterprise Trust Plc Annual Report and Accounts 2022 (b) Financial assets The Company classifies its financial assets in the following categories: at fair value through profit or loss; and at amortised cost. The classification depends on the purpose for which the financial assets were acquired. The classification of financial assets is determined at initial recognition. Financial assets at fair value through profit or loss The Company classifies its quoted and unquoted investments as financial assets at fair value through profit or loss. These assets are measured at subsequent reporting dates at fair value and further details of the accounting policy are disclosed in note 1(c). Financial assets at amortised cost Financial assets at amortised cost are non-derivative financial assets which pass the contractual cash flow test and are held to receive contractual cash flows. These are classified as current assets and measured at amortised cost using the effective interest rate method. The Company’s financial assets at amortised cost comprise cash and cash equivalents and trade and other receivables in the balance sheet. (c) Investments All investments are classified upon initial recognition as held at fair value through profit or loss (described in these financial statements as investments held at fair value) and are measured at subsequent reporting dates at fair value. All investments are fair valued in line with IFRS 13 ‘Fair Value Measurement’, using industry standard valuation guidelines such as the International Private Equity and Venture Capital (‘IPEV’) valuation guidelines. Changes in the value of all investments held at fair value, which include returns on those investments such as dividends and interest, are recognised in the income statement and are allocated to the revenue column or the capital column in accordance with the SORP (see note 1(a)). More detail on certain categories of investment is set out below. Given that the subsidiaries and associates are held at fair value and are exposed to materially similar risks as the Company, we do not expect the risks to materially differ from those disclosed in note 17. Unquoted investments Fund investments and Co-investments (collectively ‘unquoted investments’) are fair valued using the net asset value of those unquoted investments as determined by the third-party investment manager of those funds. The third-party investment manager performs periodic valuations of the underlying investments in their funds, typically using earnings multiple or discounted cash flow methodologies to determine enterprise value in line with IPEV Guidelines. In the absence of contrary information, these net asset valuations received from the third-party investment managers are deemed to be appropriate by the Manager, for the purposes of the Manager’s determination of the fair values of the unquoted investments. A robust assessment is performed by the Manager’s experienced Investment Committee to determine the capability and track record of the investment manager. All investment managers are scrutinised by the Investment Committee and an approval process is recorded before any new investment manager is approved and an investment made. This level of scrutiny provides reasonable comfort that the investment manager’s valuation will be consistent with the requirement to use fair value. Adjustments may be made to the net asset values provided or an alternative method may be deemed to be more appropriate. The most common reason for adjustments is to take account of events occurring after the date of the manager’s valuation, and better information becoming available, such as a realisation or a significant macro-economic event. Quoted investments Quoted investments are held at the last traded bid price on the balance sheet date. When a purchase or sale is made under contract, the terms of which require delivery within the timeframe of the relevant market, the contract is reflected on the trade date. Subsidiary undertakings The investments in the controlled structured entities (‘subsidiaries’) are recognised at fair value through profit and loss. The valuation of the subsidiaries takes into account an accrual for the estimated value of interests in the Co-investment Incentive Scheme. Under these arrangements, ICG (the ‘Manager’) and certain of its executives and, in respect of certain historic investments, the executives and connected parties of Graphite Capital Management LLP (the ‘Former Manager’) (together ‘the Co-investors’), are required to co-invest alongside the Company, for which they are entitled to a share of investment profits if certain performance hurdles are met. These arrangements are discussed further in the Report of the Directors on pages 52 to 54. At 31 January 2022, the accrual was estimated as the theoretical value of the interests if the Portfolio had been sold at the carrying value at that date. Associates Investments which fall within the definition of an associate under IAS 28 (Investments in associates) are accounted for as investments held at fair value through profit or loss, as permitted by that standard. The Company holds an interest (including indirectly through its subsidiaries) of more than 20% in a small number of investments that may normally be classified as subsidiaries or associates. These investments are not considered subsidiaries or associates as the Company does not exert control or significant influence over the activities of these companies/structured entities as they are managed by other third parties. (d) Receivables Receivables include unamortised fees which were incurred directly in relation to the agreement of a financing facility. These fees will be amortised over the life of the facility on a straight-line basis. (e) Payables Other payables are non-interest bearing and are stated at their amortised cost, which is not materially different from fair value. ICG Enterprise Trust Plc Annual Report and Accounts 2022 75 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Notes to the financial statements continued 1 ACCOUNTING POLICIES CONTINUED (f) Cash and cash equivalents Cash and cash equivalents comprise cash and short-term bank deposits with an original maturity of three months or less. (g) Dividend distributions Dividend distributions to shareholders are recognised in the period in which they are paid. (h) Income When it is probable that economic benefits will flow to the Company and the amount can be measured reliably, interest is recognised on a time apportionment basis. Dividends receivable on quoted equity shares are brought into account on the ex-dividend date. Dividends receivable on equity shares where no ex-dividend date is applicable are brought into account when the Company’s right to receive payment is established. UK dividend income is recorded at the amount receivable. Overseas dividend income is shown net of withholding tax. Income distributions from funds are recognised when the right to distributions is established. (i) Expenses All expenses are accounted for on an accruals basis. Expenses are allocated to the revenue column in the income statement, consistent with the SORP, with the following exceptions: • Expenses which are incidental to the acquisition or disposal of investments (transaction costs) are allocated to the capital column. • The Board expects the majority of long-term returns from the Portfolio to be generated from capital gains. Effective 1 February 2021 the Company made changes to its expenses accounting estimate on a prospective basis. In prior periods investment management and bank facility charges were being allocated 75% to the capital column of the income statement and 25% to the revenue column. On reassessment of the Company’s long-term total returns the Board agreed that an allocation of 90% to the capital column and 10% to the revenue column would better reflect the Company’s current and future return profile. Other expenses are allocated to the capital column where a clear connection with the maintenance or enhancement of the value of investments can be demonstrated. In accordance with the SORP, no changes to the prior period are required. • All expenses allocated to the capital column are treated as realised capital losses (see note 1(l)). (j) Taxation Investment trusts which have approval as such under Section 1158 of the Corporation Tax Act 2010 are not liable for taxation on capital gains. Tax recognised in the income statement represents the sum of current tax and deferred tax charged or credited in the year. The tax effect of different items of expenditure is allocated between capital and revenue on the same basis as the particular item to which it relates. Deferred tax is the tax expected to be payable or recoverable on the difference between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Deferred tax assets are not recognised in respect of tax losses carried forward to future periods. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the assets are realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. (k) Foreign currency translation The functional and presentation currency of the Company is sterling, reflecting the primary economic environment in which the Company operates. Transactions in currencies other than sterling are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, financial assets and liabilities denominated in foreign currencies are translated at the rates prevailing on the balance sheet date. Gains and losses arising on the translation of investments held at fair value are included within gains and losses on investments held at fair value in the income statement. Gains and losses arising on the translation of other financial assets and liabilities are included within foreign exchange gains and losses in the income statement. (l) Revenue and capital reserves The revenue return component of total income is taken to the revenue reserve within the statement of changes in equity. The capital return component of total income is taken to the capital reserve within the statement of changes in equity. Gains and losses on the realisation of investments including realised exchange gains and losses and expenses of a capital nature are taken to the realised capital reserve (see note 1(i)). Changes in the valuations of investments which are held at the year end and unrealised exchange differences are accounted for in the unrealised capital reserve. The revenue reserve is distributable by way of dividends to shareholders. The realised capital reserve is distributable by way of dividends and share buybacks. The capital redemption reserve is not distributable and represents the nominal value of shares bought back for cancellation. 76 ICG Enterprise Trust Plc Annual Report and Accounts 2022 (m) Treasury shares Shares that have been repurchased into treasury remain included in the share capital balance, unless they are cancelled. (n) Critical estimates and assumptions Estimates and judgements used in preparing the financial information are continually evaluated and are based on historic experience and other factors, including expectations of future events that are believed to be reasonable. The resulting estimates will, by definition, seldom equal the related actual results. In preparing the financial statements, the Directors have considered the impact of climate change on the key estimates within the financial statements. The only estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities relate to the valuation of unquoted investments. Unquoted investments are primarily the Company’s investments in unlisted funds, managed by third-party investment fund managers and ICG. As such there is significant estimation in the valuation of the unlisted fund at a point in time. Note 1(c) sets out the accounting policy for unquoted investments. The carrying amount of unquoted investments at the year end is disclosed within Note 10. The Directors’ considerations of climate risk in respect of this key estimate did not have a material impact on the financial reporting judgements and estimates in the current year. This reflects the consideration that climate risk is not expect to have a significant impact on the Company’s short and medium-term cash flows including those considered in the going concern and viability assessments. (o) Segmental reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker who is responsible for allocating resources and assessing performance of the segments has been identified as the Board. It is considered that the Company’s operations comprise a single operating segment. 2 INVESTMENT RETURNS Income from investments UK investment income Overseas interest and dividends Deposit interest on cash Other Total income Analysis of income from investments Quoted overseas Unquoted Year ended 31 January 2022 £’000 Year ended 31 January 2021 £’000 – 5,501 5,501 2 – 2 1,367 5,156 6,523 26 45 71 5,503 6,594 – 5,501 5,501 – 6,523 6,523 3 INVESTMENT MANAGEMENT CHARGES Management fees paid to ICG for managing the Enterprise Trust amounted to 1.25% (2021: 1.29%) of the average net assets in the year. This movement is due to an increase in the relative value of fee-bearing assets and commitments compared to non-fee bearing assets and commitments. The management fee charged for managing the Company remains at 1.4% (2021: 1.4%) of the fair value of invested assets and 0.5% (2021: 0.5%) of outstanding commitments, in both cases excluding funds managed by Graphite Capital (the Former Manager) and ICG. No fee is charged on cash or liquid asset balances. The allocation of the total investment management charge was changed from 1 February 2021 with 90% allocated to capital and 10% allocated to revenue in the year ended 31 January 2022 (2021: 75%:25%). The amounts charged during the year are set out below. Investment management charge Year ended 31 January 2022 Year ended 31 January 2021 Revenue £’000 1,342 Capital £’000 12,075 Total £’000 13,417 Revenue £’000 2,682 Capital £’000 8,046 Total £’000 10,728 ICG Enterprise Trust Plc Annual Report and Accounts 2022 77 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONNotes to the financial statements continued 3 INVESTMENT MANAGEMENT CHARGES CONTINUED The Company and its subsidiaries also incur management fees in respect of its investment in funds managed by members of ICG on an arms-length basis. ICG Strategic Equity Fund IV ICG Strategic Equity Fund III ICG Europe Fund VII ICG Europe VIII ICG Europe Mid-Market Fund ICG Europe Fund VI ICG Asia Pacific III ICG Recovery Fund 2008B ICG Europe Fund V ICG Strategic Secondaries Fund II ICG European Fund 2006B ICG North American Private Debt Fund III Year ended 31 January 2022 £’000 Year ended 31 January 2021 £’000 389 320 318 266 84 71 38 31 20 – – – – 379 432 – 224 138 29 54 35 185 63 – 1,537 1,539 4 OTHER EXPENSES The Company did not employ any staff in the year to 31 January 2022 (2021: none). Directors’ fees (see note 5) Fees payable to the Company’s auditors for the audit of the Company’s annual accounts Fees payable to the Company’s auditors and its associates for other services: – Audit of the accounts of the subsidiaries – Audit-related assurance services Total auditor’s remuneration1 Administrative expenses Bank facility costs allocated to revenue Interest expense allocated to revenue Expenses allocated to revenue Bank facility costs allocated to capital Total other expenses Year ended 31 January 2022 Year ended 31 January 2021 £’000 – 156 122 39 £’000 262 317 1,503 2,082 252 50 2,383 2,263 4,646 £’000 – 117 82 34 £’000 251 – – – 233 963 1,447 546 136 2,129 1,941 4,070 1 The auditors of the Company have additionally provided £13k (2021: £13k) of non-audit related services permitted under the Financial Reporting Council’s (‘FRC’) Revised Ethical Standards. The service related to agreed upon procedures over the Company’s carried interest scheme. These expenses have been charged to the Manager of the Company. While Auditor’s remuneration has increased during the year, this reflects both an increase in scope following the establishment of ET Holdings LP and an inflationary increase consistent with what has been observed within the market. Included within Total other expenses above are £2.6m of costs related to financing and £0.3m of other expenses which are non-recurring and are excluded from the Ongoing Charges as detailed in the Glossary on page 96. Professional fees of £0.1m (2021: £0.2m) incidental to the acquisition or disposal of investments are included within gains/(losses) on investments held at fair value. 5 DIRECTORS’ REMUNERATION AND INTERESTS The fees paid by the Company to the directors and the directors’ interests in the share capital of the Company are shown in the Directors’ Remuneration Report on pages 56 to 59. No income was received or receivable by the directors from any other subsidiary of the Company. 78 ICG Enterprise Trust Plc Annual Report and Accounts 2022 6 TAXATION In both the current and prior years the tax charge was lower than the standard rate of corporation tax of 19%, principally due to the Company’s status as an investment trust, which means that capital gains are not subject to corporation tax. The effect of this and other items affecting the tax charge are shown in note 6(b) below. The UK Government has announced an increase to the standard rate of corporation tax from 19% to 25% with effect from 1 April 2023. This is not expected to have a material impact on the Company. a) Analysis of charge in the year Tax charge on items allocated to revenue Tax credit on items allocated to capital Corporation tax b) Factors affecting tax charge for the year Profit on ordinary activities before tax Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2021: 19%) Effect of: – Net investment returns not subject to corporation tax – Dividends not subject to corporation tax – Current year management expenses not utilised/(utilised) – Other movements in respect of subsidiary investments Total tax charge Year ended 31 January 2022 £’000 Year ended 31 January 2021 £’000 – – – – – – 226,490 43,033 175,068 33,263 (45,419) (34,627) (295) 655 2,026 – (1,030) 2,002 392 – The Company has £28.7m excess management expenses carried forward (2021: £23.7m). No deferred tax assets or liabilities (2021: nil) have been recognised in respect of the carried forward management expenses due to the uncertainty that future taxable profit will be generated that these losses can be offset against. For all investments the tax base is equal to the carrying amount. There was no deferred tax expense relating to the origination and reversal of timing differences in the year (2021: nil). 7 EARNINGS PER SHARE Revenue return per ordinary share Capital return per ordinary share Earnings per ordinary share (basic and diluted) Year ended 31 January 2022 Year ended 31 January 2021 2.59p 327.38p 329.97p 2.59p 251.94p 254.53p Revenue return per ordinary share is calculated by dividing the revenue return attributable to equity shareholders of £1.8m (2021: £1.8m) by the weighted average number of ordinary shares outstanding during the year. Capital return per ordinary share is calculated by dividing the capital return attributable to equity shareholders of £224.7m (2021: £173.3m) by the weighted average number of ordinary shares outstanding during the year. Basic and diluted earnings per ordinary share are calculated by dividing the earnings attributable to equity shareholders of £226.5m (2021: £175.1m) by the weighted average number of ordinary shares outstanding during the year. The weighted average number of ordinary shares outstanding (excluding those held in treasury) during the year was 66,638,288 (2021: 68,781,700). There were no potentially dilutive shares, such as options or warrants, in either year. ICG Enterprise Trust Plc Annual Report and Accounts 2022 79 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONNotes to the financial statements continued 8 DIVIDENDS Third quarterly dividend in respect of year ended 31 January 2021: 5p per share (2021: 5.0p) Final dividend in respect of year ended 31 January 2021: 9.0p per share (2021: 8.0p) First quarterly dividend in respect of year ended 31 January 2022: 6.0p per share (2021: 5.0p) Second quarterly dividend in respect of year ended 31 January 2022: 6.0p per share (2021: 5.0p) Total Year ended 31 January 2022 £’000 Year ended 31 January 2021 £’000 3,438 6,189 4,111 4,111 17,849 3,444 5,502 3,438 3,438 15,822 The Company paid a third quarterly dividend of 6.0p per share in March 2022. The Board has proposed a final dividend of 27p per share in respect of the year ended 31 January 2022 which, if approved by shareholders, will be paid on 29 August 2022 to shareholders on the Register of Members at the close of business on 8 August 2022. 9 SUBSIDIARY UNDERTAKINGS AND UNCONSOLIDATED STRUCTURED ENTITIES Subsidiary undertakings (controlled structured entities) Subsidiaries of the Company as at 31 January 2022 comprise the following controlled structured entities, which are registered in England and Wales. Subsidiaries of the Company’s direct subsidiaries are reported as indirect subsidiaries. Direct subsidiaries ICG Enterprise Trust Limited Partnership ICG Enterprise Trust (2) Limited Partnership ICG Enterprise Trust Co-investment Limited Partnership Indirect subsidiaries ET Holdings LP ICG Morse Partnership LP ICG Lewis Partnership LP Ownership interest 2022 Ownership interest 2021 97.5% 97.5% 99.0% 97.5% 97.5% 99.0% Ownership interest 2022 Ownership interest 2021 99.5% 99.5% 99.5% – 99.5% 99.5% In accordance with IFRS 10 (amended), the subsidiaries are not consolidated and are instead included in unquoted investments at fair value. The Company accounts for its interest in subsidiaries in accordance with the equity method and is therefore not required to disclose, for each subsidiary, the aggregate amount of its capital and reserves and its profit or loss for the year. The value of the subsidiaries is shown net of an accrual for the interests of the Co-investors (ICG and certain of its executives, and, in respect of certain historical investments, the executives and connected parties of Graphite Capital, the Former Manager) in the Co-investment Incentive Scheme. As at 31 January 2022, a total of £49.2m (2021: £41.8m) was accrued in respect of these interests. During the year the Co-investors invested £0.2m (2021: £0.5m) into ICG Enterprise Trust Co-investment Limited Partnership. Payments received by the Co-investors amounted to £9.2m or 0.3% of £342.9m Total Proceeds received in the year (2021: £8.7m or 4.1% of £209.2m proceeds received). More than 70% of payments related to investments made in 2016 or before, reflecting the very long-term nature of the incentive scheme. See the Report of the Directors on pages 52 to 54 for further details of the operation of the scheme. Unconsolidated structured entities The Company’s principal activity is investing in private equity funds and directly into private companies. Such investments may be made and held via a subsidiary. The majority of these investments are unconsolidated structured entities as defined in IFRS 12. The Company holds interests in closed-ended limited partnerships which invest in underlying companies for the purposes of capital appreciation. The Company and the other limited partners make commitments to finance the investment programme of the relevant manager, who will typically draw down the amount committed by the limited partners over a period of four to six years. The table below disaggregates the Company’s interests in unconsolidated structured entities. The table presents for each category the related balances and the maximum exposure to loss. Total investments As at 31 January 2022 As at 31 January 2021 Unquoted investments £’000 1,171,302 907,425 Co-investment Incentive Scheme Accrual £’000 (49,157) (37,103) Maximum loss exposure £’000 1,122,145 870,322 The Company also holds investments of £1.6m (2021: £1.3m) that are not unconsolidated structured entities. In addition the Company also holds quoted stock investments of £0.0m (2021: £35.7m). The £49.2m Co-investment Incentive Scheme Accrual disclosed above does not include amounts accrued in respect of quoted equities. Further details of the Company’s investment Portfolio are included in the Other information section on page 91. 80 ICG Enterprise Trust Plc Annual Report and Accounts 2022 10 INVESTMENTS The tables below analyse the movement in the carrying value of the Company’s investment assets in the year. In accordance with accounting standards, subsidiary undertakings of the Company are reported at fair value rather than on a ‘look-through’ basis. An investee fund is considered to generate realised gains or losses if it is more than 85% drawn and has returned at least the amount invested by the Company. All gains and losses arising from the underlying investments of such funds are presented as realised. All gains and losses in respect of fund investments that have not satisfied the above criteria are presented as unrealised. Direct Investments are considered to generate realised gains or losses when they are sold. Investments are held by both the Company and through its subsidiaries. An analysis of gains and losses on an underlying investment look-through basis is presented on page 93 within the Other information section. Cost at 1 February 2021 Net unrealised appreciation at 1 February 2021 Valuation at 1 February 2021 Movements in the year: – Transfer to subsidiary undertakings – Cost1 – Transfer to subsidiary undertakings – Unrealised appreciation1 – Purchases – Sales – Capital proceeds – Realised gains/(losses) based on carrying value at previous balance sheet date – Movement in unrealised appreciation Valuation at 31 January 2022 Cost at 31 January 20222 Net unrealised appreciation for the year to 31 January 2022 Valuation at 31 January 2022 Cost at 1 February 2020 Net unrealised appreciation at 1 February 2020 Valuation at 1 February 2020 Movements in the year: – Purchases – Sales – Capital proceeds Quoted £’000 1,410 34,292 35,702 – – – Unquoted £’000 394,393 200,116 594,509 (232,126) (210,875) 75,125 (35,702) (65,280) – – – – – – Quoted £’000 692 539 1,231 1,968 38,687 202,009 164,996 37,013 202,009 Unquoted (restated)3 £’000 390,847 171,189 562,036 Subsidiary undertakings £’000 136,393 140,958 277,351 232,126 210,875 2,524 – – 198,862 921,738 368,264 553,474 921,738 Subsidiary undertakings (restated)3 £’000 129,134 86,015 215,149 Total £’000 532,196 375,366 907,562 – – 77,649 (100,982) 1,968 237,550 1,123,747 533,260 590,487 1,123,747 Total £’000 520,673 257,743 778,416 – 85,387 7,233 92,620 (1,257) (146,288) – Realised gains/(losses) based on carrying value at previous balance sheet date – (17,088) – Movement in unrealised appreciation Valuation at 31 January 2021 Cost at 31 January 2021 Net unrealised appreciation for the year to 31 January 2021 Valuation at 31 January 2021 35,728 35,702 1,410 34,292 35,702 110,462 594,509 394,393 200,116 594,509 – – 54,969 277,351 136,393 140,958 277,351 (147,545) (17,088) 201,159 907,562 532,196 375,366 907,562 1 On 26 February 2021, the Company finalised a new bank facility of €200m (£177m, translated at the rate prevailing on the day the facility became available for use) with Credit Suisse. The facility was agreed to strengthen the Company’s financial position and replace the previous facility that was in place at the year end. The new facility requires at least £500m of investments be held in a single entity in order to provide security for the facility. To meet this criteria, a new subsidiary of the Company, ET Holdings LP, was incorporated on 15 December 2020. During February and March 2021 the Company completed a number of transfers of its investments, as well as transfers of investments from the Company’s subsidiary ICG Enterprise Trust Co-investment LP, to ET Holdings LP. In addition, during the year to 31 January 2022, ET Holdings LP entered into a number of new investments in its own right. The fair value of investments held in ET Holdings LP as at 31 January 2022 is £750.5m. 2 Cost and unrealised appreciation at 31 January 2022 for Quoted investments have been adjusted to reflect £7.1m of cost associated with fully realised investments. Cost and unrealised appreciation at 31 January 2022 for Subsidiary undertakings have been adjusted to reflect £2.8m of cost associated with fully realised investments. 3 Cost, unrealised appreciation and valuation of unquoted investments as at 1 February 2020 have been restated by £7.6m, £1.5m and £9.1m respectively to correct the allocation of two unquoted investments to subsidiary undertakings which were previously reported as being held by the Company. The allocation of Purchases has been restated with a reduction in Purchases of Unquoted by £0.7m and a corresponding increase in Subsidiary undertakings. The allocation of Movement in unrealised appreciation has been restated with an increase in Unquoted of £0.1m and a decrease in Subsidiary undertakings of £0.1m. ICG Enterprise Trust Plc Annual Report and Accounts 2022 81 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONNotes to the financial statements continued 10 INVESTMENTS CONTINUED Realised gains based on cost Amounts recognised as unrealised in previous years Realised gains based on carrying values at previous balance sheet date Increase in unrealised appreciation Gains on investments 31 January 2022 £’000 79,908 (77,940) 1,968 237,550 239,518 31 January 2021 £’000 105,033 (122,121) (17,088) 201,159 184,071 ‘Realised gains based on cost’ represents the total increase in value, compared to cost, of those funds which meet the criteria set out in page 81. These gains are adjusted for amounts previously reported as unrealised (and included within the fair value at the previous balance sheet date) to determine the ‘Realised gains based on carrying values at previous balance sheet date’. Gains on investments includes the ‘Realised gains based on carrying values at previous balance sheet date’ together with the net fair value movement on the balance of the investee funds. Related undertakings At 31 January 2021, the Company held direct and indirect interests in six limited partnership subsidiaries. These interests, net of the incentive accrual as described in note 9, were: Investment ICG Enterprise Trust Limited Partnership ICG Enterprise Trust (2) Limited Partnership ICG Enterprise Trust Co-investment Limited Partnership ICG Enterprise Holdings LP ICG Morse Partnership LP ICG Lewis Partnership LP 31 January 2022 % 31 January 2021 % 99.9% 66.5% 66.0% 99.5% 99.5% 99.5% 54% 60% 93% – 99.5% 99.5% The registered address and principal place of business of the subsidiary partnerships is Procession House, 55 Ludgate Hill, London EC4M 7JW. In addition the Company held an interest (including indirectly through its subsidiaries) of more than 20% in the following entities. These investments are not considered subsidiaries or associates as the Company does not exert control or have voting rights over the activities of these companies/partnerships. As at 31 January 2022 Investment Cognito IQ Limited2 Cognito IQ Limited2 Graphite Capital Partners VII Top Up Plus3 Graphite Capital Partners VIII Top Up3 As at 31 January 2021 Investment Cognito IQ Limited2 Cognito IQ Limited2 Graphite Capital Partners VII Top Up Plus3 Graphite Capital Partners VIII Top Up3 Instrument % interest1 Preference shares Ordinary shares Limited partnership interests Limited partnership interests 44.0% 34.5% 20.0% 41.1% Instrument % interest1 Preference shares Ordinary shares Limited partnership interests Limited partnership interests 44.0% 34.5% 20.0% 41.1% 1 The percentage shown for limited partnership interests represents the proportion of total commitments to the relevant fund. The percentage shown for shares represents the proportion of total shares in issue. 2 Address of principal place of business is Rivergate House, Newbury Business Park, London Road, Newbury RG14 2PZ. 3 Address of principal place of business is 7 Air Street, Soho, London W1B 5AD. 82 ICG Enterprise Trust Plc Annual Report and Accounts 2022 11 CASH AND CASH EQUIVALENTS Cash at bank and in hand 12 RECEIVABLES Prepayments and accrued income 31 January 2022 £’000 31 January 2021 £’000 41,328 45,143 31 January 2022 £’000 2,205 31 January 2021 £’000 162 As at 31 January 2022, prepayments and accrued income included £2.2m (2021: £0.1m) of unamortised costs in relation to the bank facility. Of this amount £0.7m (2021: £0.1m) is expected to be amortised in less than one year. 13 PAYABLES – CURRENT Accruals 31 January 2022 £’000 9,303 31 January 2021 £’000 851 Accruals primarily comprise unbilled management fees which have been subsequently been settled. 14 SHARE CAPITAL Equity share capital Authorised Issued and fully paid Number Nominal £’000 Number Nominal £’000 7,292 Balance at 31 January 2022 and 31 January 2021 120,000,000 12,000 72,913,000 All ordinary shares have a nominal value of 10.0p. At 31 January 2022 and 31 January 2021, 72,913,000 shares had been allocated, called up and fully paid. During the year 250,000 shares were bought back in the market and held in treasury (2021: 110,000 shares). At 31 January 2022, the Company held 4,395,945 shares in treasury (2021: 4,145,945) leaving 68,517,055 (2021: 68,767,055) shares outstanding, all of which have equal voting rights. 15 NET ASSET VALUE PER SHARE The net asset value per share is calculated on equity attributable to equity holders of £1,158.0m (2021: £952.0m) and on 68,517,055 (2021: 68,767,055) ordinary shares in issue at the year end. There were no potentially dilutive shares, such as options or warrants, at either year end. Calculated on both the basic and diluted basis the net asset value per share was 1,690.1p (2021: 1,384.4p). ICG Enterprise Trust Plc Annual Report and Accounts 2022 83 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION31 January 2022 £’000 31 January 2021 £’000 30,590 17,636 17,369 15,613 13,724 10,348 10,325 9,909 5,161 4,234 4,214 2,895 2,355 1,282 845 766 680 599 544 479 290 213 145 121 91 36 – 17,471 – 16,470 – 15,807 19,259 16,169 – 4,770 4,565 2,840 728 – 994 904 731 1,081 534 644 804 226 154 119 – 70 150,464 104,340 8,882 4,408 1,554 14,844 20,296 5,446 2,771 28,513 Notes to the financial statements continued 16 CAPITAL COMMITMENTS AND CONTINGENCIES The Company and its subsidiaries had uncalled commitments in relation to the following Portfolio investments: ICG Europe VIII ICG Augusta Partners Co-Investor2 ICG Strategic Equity IV ICG Strategic Secondaries Fund II ICG Ludgate Hill (Feeder B) SCSp ICG Europe VII ICG Strategic Equity Fund III ICG Europe Mid-Market Fund ICG Ludgate Hill (Feeder) II Boston SCSp ICG North American Private Debt Fund II ICG Europe VI2 ICG Asia Pacific Fund III ICG Topvita Co-investment1 ICG Dallas Co-Investment ICG Recovery Fund 2008 B2 ICG Europe V2 ICG Cheetah Co-Investment ICG Velocity Partners Co-Investor2 ICG Progress Co-Investment ICG European Fund 2006 B ICG Cross Border2 ICG MXV Co-Investment1 ICG Diocle Co-Investment ICG Match Co-Investment ICG Sunrise Co-Investment ICG Trio Co-Investment Total ICG funds Graphite Capital Partners IX Graphite Capital Partners VIII2 Graphite Capital Partners VII1,2 Total Graphite funds 1 2 Includes interest acquired through a secondary fund purchase. Includes the associated Top Up funds. 84 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Thomas H Lee Equity Fund IX PAI Europe VII CVC European Equity Partners VIII BC XI Investindustrial VII Resolute V Seventh Cinven Fund New Mountain VI Bowmark Capital Partners VI Bregal Unternehmerkapital III Leeds VII Bain Capital XIII PAI Mid-Market Fund GHO Capital III FSN VI AEA VII Charlesbank X Advent Global Private Equity IX GI Partners VI CD&R XIII Carlyle Europe Partners V Apax X Gridiron Capital Fund IV Gridiron Capital Fund III Thomas H Lee Equity Fund VIII Permira VII Tailwind Capital Partners III Bain Capital Europe V Hellman Friedman X Bowmark Capital Partners V CVC European Equity Partners VII Charterhouse Capital Partners X Hg Saturn 2 Ivanti CB Technology Opportunities Fund IK IX Hg Genesis 9 Project Midsummer Five Arrows FACP Commitments of less than £2,000,000 at 31 January 2022 Total third party Total commitments 31 January 2022 £’000 31 January 2021 £’000 14,318 10,182 10,078 8,626 8,283 7,787 7,566 7,272 7,230 7,200 7,033 6,916 6,788 6,672 6,126 5,867 5,733 5,458 5,246 5,233 4,394 4,390 4,272 4,066 3,719 3,597 3,522 3,392 3,382 3,238 3,187 3,135 2,912 2,746 2,336 2,167 2,099 2,087 2,022 43,026 253,303 418,611 – 12,323 13,290 – 12,312 – 15,766 10,067 8,245 – 7,295 7,295 8,792 – 8,860 12,149 7,295 8,381 – 7,295 6,145 8,753 6,412 3,999 8,221 8,038 5,009 5,263 – 3,176 7,599 4,483 3,099 – 2,847 4,292 4,430 – 2,829 30,304 285,632 418,485 The Company and its subsidiaries had no other unfunded commitments to investment funds. As at 31 January 2022, the Company (excluding its subsidiaries) had uncalled commitments in relation to the above Portfolio of £76.0m (2021: £281.4m). The Company did not have any contingent liabilities at 31 January 2022 (2021: None). The Company’s subsidiaries, which are not consolidated, had the balance of uncalled commitments in relation to the above Portfolio of £342.6m (2021: £137.1m). The Company is responsible for financing its pro-rata share of those uncalled commitments (see note 9). ICG Enterprise Trust Plc Annual Report and Accounts 2022 85 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION Notes to the financial statements continued 17 FINANCIAL INSTRUMENTS AND RISK MANAGEMENT The Company is an investment company as defined by Section 833 of the Companies Act 2006 and conducts its affairs so as to qualify as an investment trust under the provisions of Section 1158 of the Corporation Tax Act 2010 (‘Section 1158’). The Company’s objective is to provide long-term growth by investing in private companies managed by leading private equity managers. Investments in funds have anticipated lives of approximately 10 years. Direct Investments are made with an anticipated holding period of between three and five years. Financial risk management The Company’s activities expose it to a variety of financial risks: market risk (comprising currency risk, interest rate risk and price risk), investment risk, credit risk and liquidity risk. The Company’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Company’s financial performance. The Board has overall responsibility for managing the risks and the framework for monitoring and coordinating these risks. The Audit Committee regularly reviews, identifies and evaluates the risks taken by the Company to allow them to be appropriately managed. All of the Company’s management functions are delegated to the Manager which has its own internal control and risk monitoring arrangements. The Committee makes a regular assessment of these arrangements, with reference to the Company’s risk matrix. The Company’s financial risk management objectives and processes used to manage these risks have not changed from the previous period and the policies are set out below: Market risk (i) Currency risk The Company’s investments are principally in the UK, continental Europe and the US, and are primarily denominated in sterling, euro and US dollars. There are also smaller amounts in other European currencies. The Company is exposed to currency risk in that movements in the value of sterling against these foreign currencies will affect the net asset value and the cash required to fund undrawn commitments. The Board regularly reviews the level of foreign currency denominated assets and outstanding commitments in the context of current market conditions and may decide to buy or sell currency or put in place currency hedging arrangements. No hedging arrangements were in place during the financial year. The composition of the net assets of the Company by reporting currency at the year end is set out below: 31 January 2022 Investments Cash and cash equivalents and other net current assets 31 January 2021 Investments Cash and cash equivalents and other net current assets Sterling £’000 950,837 14,413 965,250 Sterling £’000 402,358 26,275 428,633 Euro £’000 62,743 12,648 75,391 Euro £’000 278,351 3,331 281,682 US dollar £’000 109,985 6,906 116,891 US dollar £’000 226,328 14,561 240,889 Other £’000 182 263 445 Other £’000 525 287 812 Total £’000 1,123,747 34,230 1,157,977 Total £’000 907,562 44,454 952,016 The effect of a 25% increase or decrease in the sterling value of the euro would be a fall of £66.1m and a rise of £46.7m in the value of shareholders’ equity and on profit after tax at 31 January 2022 respectively (2021: a fall of £56.4m and a rise of £56.3m based on 25% increase or decrease). The effect of a 25% increase or decrease in the sterling value of the US dollar would be a fall of £112.8m and a rise of £92.6m in the value of shareholders’ equity and on profit after tax at 31 January 2022 respectively (2021: a fall of £91.2m and a rise of £89.7m based on 25% movement). These sensitivity figures are based on the currency of the location of the underlying portfolio companies’ headquarters. The percentages applied are based on market volatility in exchange rates observed in prior periods. (ii) Interest rate risk The Company’s assets primarily comprise non-interest bearing investments in funds and non-interest bearing investments in portfolio companies. The fair values of these investments are not significantly directly affected by changes in interest rates. The Company’s cash balance is exposed to interest rate risk; the financial impact of this risk is currently immaterial. The Company is indirectly exposed to interest rate risk through the impact of interest rates on the performance of investments in funds and portfolio companies as a result of interest rate changes impacting the underlying manager valuation. This performance impact as a result of interest rate risk is recognised through the valuation of those investments, which will be affected by the impact of any change in interest rates on the financial performance of the underlying portfolio companies and also on any valuation of those investments for sale. The Company is not able to quantify how a change in interest rates would impact valuations. (iii) Price risk The risk that the value of a financial instrument will change as a result of changes to market prices is one that is fundamental to the Company’s objective, which is to provide long-term capital growth through investment in unquoted companies. The investment Portfolio is continually monitored to ensure an appropriate balance of risk and reward in order to achieve the Company’s objective. 86 ICG Enterprise Trust Plc Annual Report and Accounts 2022 The Company is exposed to the risk of change in value of its private equity investments. For all investments the market variable is deemed to be the price itself. The table below shows the impact of a 30% increase or decrease in the valuation of the investment Portfolio. The percentages applied are reasonable based on the Manager’s view of the potential for volatility in the Portfolio valuations under stressed conditions. 30% movement in the price of investments Impact on profit after tax Impact as a percentage of profit after tax Impact as a percentage of shareholders’ equity 31 January 2022 31 January 2021 Increase in variable £’000 Decrease in variable £’000 Increase in variable £’000 Decrease in variable £’000 319,449 (330,909) 264,076 (266,844) 141.0% 27.6% (146.1)% (28.6)% 150.8% 27.7% (152.4)% (28.0)% A reasonably possible percentage change in relation to the earnings estimates or Enterprise Value/EBITDA multiples used by the underlying managers to value the private equity fund investments and co-investments may result in a significant change in fair value of unquoted investments. Investment and credit risk (i) Investment risk Investment risk is the risk that the financial performance of the companies in which the Company invests either improves or deteriorates, thereby affecting the value of that investment. Investments in unquoted companies whether indirectly or directly are, by their nature, subject to potential investment losses. The investment Portfolio is highly diversified in order to mitigate this risk. (ii) Credit risk The Company’s exposure to credit risk arises principally from its investment in cash deposits. The Company aims to invest the majority of its liquid portfolio in assets which have low credit risk. The Company’s policy is to limit exposure to any one investment to 15% of gross assets. This is regularly monitored by the Manager as a part of its cash management process. Cash is held on deposit and in money market funds with two UK banks and totalled £41m (2021: £45m). Of this amount £20.5m was deposited at Royal Bank of Scotland (‘RBS’), which currently has a credit rating of A1 from Moody’s, and £20.5m was held in money market funds managed by HSBC Holdings (‘HSBC’), which currently has a credit rating of Aaa from Moody’s. These represent the maximum exposure to credit risk at the balance sheet date. No collateral is held by the Company in respect of these amounts. None of the Company’s cash deposits or money market fund balances were past due or impaired at 31 January 2022 (2021: nil). Liquidity risk The Company makes commitments to private equity funds in advance of that capital being invested, typically in illiquid, unquoted companies. These commitments are in excess of the Company’s total liquidity, therefore resulting in an overcommitment. When determining the appropriate level of overcommitment, the Board considers the rate at which commitments might be drawn down, typically over four to six years, versus the rate at which existing investments are sold and cash realised. The Company has an established liquidity management policy, which involves active monitoring and assessment of the Company’s liquidity position and its overcommitment risk. This is regularly reviewed by the Board and incorporated into the Board’s assessment of the viability of the Company, as detailed on page 51 of the Corporate governance report. This process incorporates balance sheet and cash flow projections, including scenarios with varying levels of Portfolio gains and losses, fund drawdowns and realisations, availability of the credit facility, exchange rates, and possible remedial action that the Company could undertake if required in the event of significant Portfolio declines. At the year end, the Company had cash and cash equivalents totalling £41.3m and had access to committed bank facilities of €200m (£167m translated at the rate prevailing on the reporting date) maturing in February 2026, which is a multi-currency revolving credit facility provided by Credit Suisse. The key terms of the facility are: • Upfront cost: 100bps. • Non-utilisation fees: 114bps per annum. • Margin on drawn amounts: 300bps per annum. As at 31 January 2022 the Company’s total financial liabilities amounted to £9.3m (2021: £0.9m) of payables which were due in less than one year, which includes accrued balances payable in respect of the credit facility above. The facility was undrawn at the reporting date. Capital risk management The Company’s capital is represented by its net assets, which are managed to achieve the Company’s investment objective. As at the year end, the Company had no debt (2021: £nil). The Board can manage the capital structure directly since it has taken the powers, which it is seeking to renew, to issue and buy back shares and it also determines dividend payments. The Company is subject to externally imposed capital requirements with respect to the obligation and ability to pay dividends by Section 1159 of the Corporation Tax Act 2010 and by the Companies Act 2006, respectively. Total equity at 31 January 2022, the composition of which is shown on the balance sheet, was £1,158.0m (2021: £952.0m). ICG Enterprise Trust Plc Annual Report and Accounts 2022 87 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONNotes to the financial statements continued 17 FINANCIAL INSTRUMENTS AND RISK MANAGEMENT CONTINUED Fair values estimation IFRS 13 requires disclosure of fair value measurements of financial instruments categorised according to the following fair value measurement hierarchy: • Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1). • Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2). • Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3). The valuation techniques applied to level 1 and level 3 assets are described in note 1(c) of the financial statements. No investments were categorised as level 2. The Company’s policy is to recognise transfers into and transfers out of fair value hierarchy levels at the end of the reporting year when they are deemed to occur. The sensitivity of the Company’s investments to a change in value is discussed on pages 86 and 87. The following table presents the assets that are measured at fair value at 31 January 2022 and 31 January 2021. The Company had no financial liabilities measured at fair value at that date. As at 31 January 2022 Investments held at fair value Unquoted investments – indirect Unquoted investments – direct Quoted investments – direct Subsidiary undertakings Total investments held at fair value As at 31 January 2021 Investments held at fair value Unquoted investments – indirect Unquoted investments – direct Quoted investments – direct Subsidiary undertakings Total investments held at fair value Level 1 £’000 Level 2 £’000 Level 3 £’000 Total £’000 – – – – – – – – – – 140,060 61,949 – 140,060 61,949 – 921,738 921,738 1,123,747 1,123,747 Level 1 £’000 Level 2 £’000 – – 35,702 – 35,702 – – – – – Level 3 (restated)1 £’000 442,671 151,838 – 277,351 871,860 Total £’000 442,671 151,838 35,702 277,351 907,562 1 The allocation of level 3 assets between unquoted investments – direct and subsidiary undertakings has been updated to reflect the allocation of two unquoted investments valued at £9.1m to Subsidiary undertakings which were previously reported as being held by the Company. All unquoted and quoted investments are valued at fair value in accordance with IFRS 9. The Company has no quoted investments as at 31 January 2021; quoted investments held by subsidiary undertakings are reported within Level 3. Investments in level 3 securities are in respect of private equity fund investments and co-investments. These are held at fair value and are calculated using valuations provided by the underlying manager of the investment, with adjustments made to the statements to take account of cash flow events occurring after the date of the manager’s valuation, such as realisations or liquidity adjustments. The following tables present the changes in level 3 instruments for the year to 31 January 2022 and 31 January 2021. 31 January 2022 Opening balances Additions Transfer to Subsidiary undertakings Disposals Gains and losses recognised in profit or loss Closing balance Total gains for the year included in income statement for assets held at the end of the reporting period 88 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Unquoted investments (indirect) at fair value through profit or loss £’000 442,696 33,479 Unquoted investments (direct) at fair value through profit or loss £’000 151,813 41,647 Subsidiary undertakings £’000 277,351 2,524 (349,295) (93,706) 443,001 Total £’000 871,860 77,649 – (34,115) 30,555 123,319 (31,165) 10,100 78,689 – (65,280) 198,862 921,738 239,517 1,123,747 28,587 10,100 198,862 237,549 31 January 2021 Opening balances Additions Disposals Gains and losses recognised in profit or loss Closing balance Total gains for the year included in income statement for assets held at the end of the reporting period Unquoted investments (indirect) at fair value through profit or loss (restated)1 £’000 454,586 76,588 Unquoted investments (direct) at fair value through profit or loss (restated)1 £’000 106,760 9,546 Subsidiary undertakings (restated)1 £’000 215,839 6,486 Total £’000 777,185 92,620 (126,673) (19,615) – (146,288) 38,195 442,696 55,122 151,813 55,026 277,351 148,343 871,860 59,085 51,320 55,026 165,431 1 The allocation of level 3 assets between unquoted investments and subsidiary undertakings has been updated to correct the allocation of two unquoted investments to subsidiary undertakings which were previously reported as being held by the Company. 18 RELATED PARTY TRANSACTIONS Significant transactions between the Company and its subsidiaries are shown below: Subsidiary ICG Enterprise Trust Limited Partnership ICG Enterprise Trust (2) Limited Partnership ICG Enterprise Trust Co-investment LP ICG Enterprise Holdings LP ICG Morse Partnership LP ICG Lewis Partnership LP Nature of transaction Increase in amounts owed to subsidiaries (Decrease) in amounts owed by subsidiaries Income allocated Increase in amounts owed to subsidiaries (Decrease) in amounts owed by subsidiaries Income allocated Increase in amounts owed by subsidiaries Income allocated Increase in amounts owed to subsidiaries Decrease in amounts owed by subsidiaries Income allocated Increase in amounts owed by subsidiaries Decrease in amounts owed to subsidiaries Income allocated Increase in amounts owed by subsidiaries Decrease in amounts owed by subsidiaries Income allocated Year ended 31 January 2022 £’000 Year ended 31 January 2021 (restated)1 £’000 5,884 – – 11,318 – 740 52,773 6,687 22,820 – 9,824 3,282 – – 71 – – 784 – 10 5,814 (2,886) 531 15,313 2,884 – – – 803 – – – 139 – 1 Restated to reflect transactions with ICG Morse Partnership LP and ICG Lewis Partnership LP. For the purpose of IAS 24 Related Party Disclosures, key management personnel comprised the Board of Directors as disclosed on pages 46 and 47. Details of remuneration are disclosed below and in further detail in the Directors’ Remuneration Report on pages 56 to 59. Remuneration in the year (audited) Name Jane Tufnell Lucinda Riches Alastair Bruce Gerhard Fusenig Sandra Pajarola David Warnock Jeremy Tigue Total Fees Taxable benefits Total 2022 £’000 2021 £’000 2022 £’000 2021 £’000 2022 £’000 2021 £’000 65 17 52 42 42 42 – 260 53 41 44 41 41 7 24 251 – – – 2 2 – – 4 – – – – – – – – 65 17 52 44 44 42 – 264 53 41 44 41 41 7 24 251 ICG Enterprise Trust Plc Annual Report and Accounts 2022 89 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONNotes to the financial statements continued 18 RELATED PARTY TRANSACTIONS CONTINUED Amounts owed by/to subsidiaries represent the Company’s loan account balances with those entities, to which the Company’s share of drawdowns and distributions in respect of those entities are credited and debited respectively. Subsidiary ICG Enterprise Trust Limited Partnership ICG Enterprise Trust (2) Limited Partnership ICG Enterprise Trust Co-investment LP ICG Enterprise Holdings LP ICG Morse Partnership LP ICG Lewis Partnership LP Amounts owed by subsidiaries Amounts owed to subsidiaries 31 January 2022 £’000 31 January 2021 (restated)1 £’000 31 January 2022 £’000 31 January 2021 (restated)1 £’000 – – 206,792 – 9,405 3,718 – – 154,019 – 6,124 3,647 25,769 17,132 – 22,820 – – 20,869 5,814 – – – – 1 Restated to reflect ICG Morse Partnership LP and ICG Lewis Partnership LP. The Company and its subsidiaries’ total shares in funds and co-investments managed by the Company’s Manager are: Fund / Co-Investment ICG Asia Pacific Fund III2 ICG Europe V1 ICG Europe VI1 ICG Europe VII1 ICG Europe Mid-Market Fund1 ICG North American Private Debt Fund II2 ICG Strategic Equity Fund III2 ICG Strategic Secondaries Fund II2 ICG European Fund 2006 B1 ICG Augusta Partners Co-Investor2 ICG Cross Border2 ICG Recovery Fund 2008 B1 ICG Velocity Partners Co-Investor2 ICG Europe VIII1 ICG Ludgate Hill (Feeder) II Boston SCSp2 ICG Strategic Equity IV2 ICG Ludgate Hill (Feeder B) SCSp1 ICG Sunrise Co-Investment1 ICG Cheetah Co-Investment1 ICG Dallas Co-Investment2 ICG Diocle Co-Investment1 ICG Topvita Co-investment1 ICG MXV Co-Investment1 ICG Progress Co-Investment2 ICG Trio Co-Investment1 ICG Match Co-Investment2 Total Year ended 31 January 2022 Year ended 31 January 2021 Original commitment £’000 Remaining commitment £’000 Fair value investment £’000 Original commitment £’000 Remaining commitment £’000 Fair value investment £’000 11,155 12,845 20,884 33,414 16,707 7,437 29,746 26,028 7,119 18,592 3,718 10,024 11,155 66,828 7,437 59,493 37,591 2,088 5,847 4,090 9,117 20,756 11,695 7,437 7,521 7,437 2,895 767 4,214 10,348 9,909 4,234 10,325 15,613 479 17,636 290 845 599 30,590 5,161 17,369 13,724 91 680 1,282 145 2,355 213 544 36 121 8,814 1,569 14,262 36,073 7,899 3,389 35,022 8,829 57 12,886 3,477 4,752 159 2,712 12,003 15,177 – 4,209 8,086 7,102 14,798 12,051 22,086 9,916 6,873 20,137 10,943 13,624 22,150 35,439 17,720 7,295 29,180 25,533 9,323 18,238 3,648 10,632 10,943 – – – – – 6,202 – 9,670 15,369 12,404 7,295 7,977 7,295 2,840 904 4,565 15,807 16,169 4,770 19,259 16,470 644 17,471 804 994 1,081 – – – – – 731 – 154 728 226 534 70 119 11,320 2,784 20,303 25,210 1,251 2,545 11,954 11,122 109 7,244 3,053 4,096 2,513 – – – – – 5,461 – 14,241 31,129 18,876 8,438 10,070 14,432 456,161 150,465 272,338 280,880 104,340 206,151 1 Euro denominated positions translated to sterling at spot rate on 31 January 2022 and 31 January 2021. 2 US dollar denominated positions translated to sterling at spot rate on 31 January 2022 and 31 January 2021. At the balance sheet date the Company has fully funded its share of capital calls due to ICG-managed funds in which it is invested. 19 POST BALANCE SHEET EVENTS There have been no material events since the balance sheet date. 90 ICG Enterprise Trust Plc Annual Report and Accounts 2022 30 largest fund investments (unaudited) We have investments with 46 leading private equity managers 1. ICG LUDGATE HILL I LP secondary portfolio. 2. ICG EUROPE FUND VII Mezzanine and equity in mid-market buyouts. 3. ICG STRATEGIC EQUITY FUND III Secondary fund restructurings. Value £42.6m Value £36.1m Value Outstanding commitment £13.7m Outstanding commitment £10.3m Outstanding commitment Committed 2021 Committed 2018 Committed Country/region Europe/North America Country/region Europe Country/region 4. GRAPHITE CAPITAL PARTNERS VIII1 Mid-market buyouts. 5. BC EUROPEAN CAPITAL IX2 Large buyouts. 6. GRIDIRON CAPITAL FUND III Mid-market buyouts. Value £32.0m Value £30.6m Value Outstanding commitment £4.4m Outstanding commitment £1.7m Outstanding commitment Committed Country/region 2013 Committed 2011 Committed UK Country/region Europe/North America Country/region North America 7. CVC EUROPEAN EQUITY PARTNERS VII Large buyouts. 8. CVC EUROPEAN EQUITY PARTNERS VI2 Large buyouts. 9. SIXTH CINVEN FUND Large buyouts. Value £26.9m Value £24.5m Value Outstanding commitment £3.2m Outstanding commitment £2.1m Outstanding commitment Committed 2017 Committed 2013 Committed £23.0m £1.6m 2016 Country/region Europe/North America Country/region Europe/North America Country/region Europe/North America 10. THOMAS H LEE FUND VIII Mid-market and large buyouts. 11. PERMIRA V2 Large buyouts. 12. PAI STRATEGIC PARTNERSHIPS2 Mid-market and large buyouts. Value £20.0m Value £19.4m Value Outstanding commitment £3.7m Outstanding commitment £0.5m Outstanding commitment Committed Country/region 2017 Committed 2013 Committed North America Country/region Europe/North America Country/region 13. BC EUROPEAN CAPITAL X Large buyouts. 14. PAI EUROPE VI Mid-market and large buyouts. 15. ADVENT IX Large buyouts. Value £18.3m Value £17.8m Value Outstanding commitment £0.6m Outstanding commitment £1.4m Outstanding commitment Committed Country/region 2016 Committed 2013 Committed Europe Country/region Europe Country/region Europe/North America £35.0m £10.3m 2018 Global £27.5m £4.1m 2016 £19.3m £0.6m 2019 Europe £17.2m £5.5m 2019 Includes the associated Top Up funds. 1 2 All or part of interest acquired through a secondary purchase. ICG Enterprise Trust Plc Annual Report and Accounts 2022 91 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATION30 largest fund investments (unaudited) continued 16. ADVENT GLOBAL PRIVATE EQUITY VIII Large buyouts. 17. TDR CAPITAL III Mid-market and large buyouts. 18. ICG STRATEGIC EQUITY IV Secondary fund restructurings. Value £16.2m Value £15.6m Value Outstanding commitment £0.6m Outstanding commitment £1.5m Outstanding commitment Committed 2019 Committed 2013 Committed Country/region Europe/North America Country/region Europe Country/region 19. NEW MOUNTAIN PARTNERS V Mid-market buyouts. 20. PAI EUROPE VII Mid-market and large buyouts. 21. GRYPHON V Mid-market buyouts. Value £15.2m Value £15.0m Value Outstanding commitment £17.4m Outstanding commitment £10.2m Outstanding commitment Committed Country/region 2017 Committed 2017 Committed North America Country/region Europe Country/region North America 22. RESOLUTE IV Mid-market buyouts. 23. ICG EUROPE FUND VI2 Mezzanine and equity in mid-market buyouts. 24. OAK HILL V Mid-market buyouts. Value £14.9m Value £14.3m Value Outstanding commitment £1.6m Outstanding commitment £4.2m Outstanding commitment Committed Country/region 2018 Committed 2015 Committed North America Country/region Europe Country/region North America 25. GRIDIRON CAPITAL FUND IV Mid-market buyouts. 26. ICG AUGUSTA PARTNERS CO-INVESTOR2 Secondary fund restructurings. 27. ICG LUDGATE HILL II Large buyouts. Value £13.7m Value £12.9m Value Outstanding commitment £4.3m Outstanding commitment £17.6m Outstanding commitment Committed Country/region 2019 Committed 2018 Committed North America Country/region Global Country/region North America 28. RESOLUTE II CONTINUATION2 Mid-market buyouts. 29. LEEDS EQUITY PARTNERS VI Mid-market buyouts. 30. PERMIRA VI Large buyouts. Value £11.7m Value £11.4m Value Outstanding commitment £2.1m Outstanding commitment £2.1m Outstanding commitment Committed Country/region Europe/North America £15.2m £17.4m 2021 Global £15.0m £1.8m 2019 £13.9m £1.9m 2019 £12.0m £5.2m 2022 £11.2m £1.9m 2016 Committed Country/region 2021 Committed North America Country/region 2017 USA Includes the associated Top Up funds. 1 2 All or part of interest acquired through a secondary purchase. 92 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Portfolio analysis (unaudited) MOVEMENT IN THE PORTFOLIO £m Opening Portfolio1 Total New Investment Total Proceeds Net cash outflow/(inflow) Underlying valuation movement2 Currency movement Closing Portfolio1 % underlying Portfolio growth (local currency) % currency movement % underlying Portfolio growth (sterling) 1 Refer to the Glossary for reconciliation to the Portfolio balance presented in the unaudited results. 2 98% of the Portfolio is valued using 31 December 2021 (or later) valuations (31 January 2021: 95%). Year ended 31 January 2022 Year ended 31 January 2021 949.2 303.7 (342.9) (39.2) 279.4 (17.2) 1,172.2 29.4% (1.8)% 27.6% 806.4 139.2 (209.2) (70.0) 200.6 12.2 949.2 24.9% 1.5% 26.4% REALISATION ACTIVITY Investment Telos Domus U-POL Berlin Packaging Manager Directly held ICG Graphite Oak Hill Capital Supporting Education Group ICG Thomas H. Lee Graphite Hg Capital / ICG ICG Gridiron System One Cognito Visma Everlight Rough Country Total of 10 largest underlying realisations Other Realisation Proceeds Fund Disposals Total Proceeds INVESTMENT ACTIVITY Investment Description Domus DigiCert Ambassador Theatre Group Operator of retirement homes Provider of enterprise internet security solutions Operator of theatres and ticketing platforms Year of investment Realisation type Proceeds £m 1998 2017 2002 2014 2014 2016 2002 2014 2016 2017 Full Full Full Partial Full Full Full Partial Full Partial Manager ICG ICG Country France United States Providence United Kingdom Planet Payment Provider of integrated payments services focused on hospitality and luxury retail Advent Ireland Ivanti Provider of IT management solutions Davies Group Provider of specialised business process outsourcing services Class Valuation Provider of residential mortgage appraisal management services Charlesbank United States ICG ICG United Kingdom United States Brooks Automation Provider of semiconductor manufacturing solutions Thomas H. Lee United States European Camping Group Operator of premium campsites and holiday parks AMEOS Group Operator of private hospitals Total of 10 largest underlying new investments Total New Investments PAI ICG France Switzerland 1 Represents ICG Enterprise Trust’s indirect exposure (share of fund cost) plus any amounts paid for co-investments in the period. 44.5 36.3 23.9 19.9 14.7 11.9 10.9 10.0 5.5 4.8 182.4 151.2 9.4 342.9 Cost1 £m 14.2 13.8 13.1 12.5 11.8 9.3 8.5 7.8 7.7 6.9 105.6 303.7 ICG Enterprise Trust Plc Annual Report and Accounts 2022 93 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONPortfolio analysis (unaudited) continued COMMITMENTS ANALYSIS Outstanding commitments by fund investment period Funds in investment period Funds post investment period Total Movement in outstanding commitments in year ended 31 January 2022 £m Outstanding commitments at beginning of year New Fund commitments New commitments relating to co-investments Drawdowns Commitments released from fund disposals Currency and other movements Outstanding commitments at end of year £m Outstanding commitments Total available liquidity (including facility) Overcommitment (including facility) Overcommitment % of net asset value NEW COMMITMENTS DURING THE YEAR TO 31 JANUARY 2022 Original commitment £m Outstanding commitment £m Average drawdown percentage % of commitments 587.9 714.4 1,302.3 308.9 109.7 418.6 47.4% 84.6% 67.8% 73.8% 26.2% 100% 31 January 2022 31 January 2021 418.5 189.9 78.3 (303.6) (9.8) 45.3 418.6 458.6 94.8 7.1 (120.6) (41.9) 20.5 418.5 31 January 2022 31 January 2021 418.6 (208) 210 18% Europe Global North America North America Europe/North America North America Europe/North America Europe North America North America Global 418.5 (201) 217 23% £m 38.7 34.8 28.8 15.0 14.1 12.8 10.9 8.6 8.6 7.2 7.1 3.2 189.9 78.4 268.2 Fund ICG Ludgate Hill I ICG Europe Fund VIII Strategy Geography Secondary portfolio of mid-market and large buyouts Europe/North America Mezzanine and equity in mid-market buyouts ICG Strategic Equity Fund IV Secondary fund restructurings ICG Ludgate Hill II Thomas H. Lee IX BC Partners XI Resolute V GHO Capital III Bregal Unternehmerkapital III GI Partners VI Hellman Friedman X Other Total Fund commitments Commitments relating to Co-investments Total new Commitments Secondary portfolio of mid-market and large buyouts Mid-market and large buyouts Mid-market buyouts Mid-market buyouts Mid-market buyouts Mid-market buyouts Mid-market buyouts Mid-market and large buyouts Secondary fundholding acquisitions 94 ICG Enterprise Trust Plc Annual Report and Accounts 2022 CURRENCY EXPOSURE Portfolio1 Sterling Euro US dollar Other European Other Total 31 January 2022 £m 31 January 2022 % 31 January 2021 £m 31 January 2021 % 290.6 219.9 450.6 95.7 115.4 1,172.2 24.8% 18.8% 38.4% 8.2% 9.8% 100.0 197.4 208.3 380.5 73.9 89.1 949.2 20.8% 21.9% 40.1% 7.8% 9.4% 100.0% 1 Currency exposure is calculated by reference to the location of the underlying portfolio companies’ headquarters. Outstanding commitments Sterling Euro US dollar Other European Total DIVIDEND ANALYSIS Period ended 31 January 20221 31 January 2021 31 January 2020 31 January 2019 31 January 2018 31 January 2017 31 January 2016 31 January 2015 31 January 2014 31 January 2013 31 January 2012 31 January 2011 31 December 2009 31 December 2008 31 December 2007 31 December 2006 31 January 2022 £m 31 January 2022 % 31 January 2021 £m 31 January 2021 % 28.7 200.4 189.5 – 418.6 6.8% 47.9% 45.3% – 100.0 Revenue return per share p Ordinary dividend per share p Special dividend per share p Total dividend per share p 2.59 2.59 4.02 2.69 23.76 8.13 11.07 12.96 19.02 3.15 6.33 1.51 (0.11) 5.12 8.86 7.44 27.0 24.0 23.0 22.0 21.0 20.0 11.0 10.0 7.5 5.0 5.0 2.25 2.25 4.5 8.0 6.5 – – – – – – – 5.5 8.0 – – – – – – – 27.0 24.0 23.0 22.0 21.0 20.0 11.0 15.5 15.5 5.0 5.0 2.25 2.25 4.5 8.0 6.5 43.7 195.9 178.2 0.7 418.5 Net asset value per share p 1,160.1 1,384.4 1,152.1 1,056.5 959.1 871.0 730.9 695.2 677.2 631.5 569.4 534.0 464.1 449.0 519.4 454.6 10.4 46.8 42.6 0.2 100.0 Closing mid-market share price p 1,200.0 966.0 966.0 822.0 818.0 698.5 545.0 575.0 563.5 487.0 357.0 308.0 305.0 187.0 474.0 386.0 1 Includes the quarterly dividend of 6.0p paid on 4 March 2022 and the final dividend of 9p to be paid on 22 July 2022 subject to shareholder approval at the AGM. ICG Enterprise Trust Plc Annual Report and Accounts 2022 95 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONGlossary (unaudited) Alternative Performance Measures (‘APM’) are a term defined by the European Securities and Markets Authority as ‘financial measures of historical or future performance, financial position, or cash flows, other than a financial measure defined or specified in the applicable financial reporting framework’. APMs are used in this report if considered by the Board and the Manager to be the most relevant basis for shareholders in assessing the overall performance of the Company and for comparing the performance of the Company to its peers, taking into account industry practice. Definitions and reconciliations to IFRS measures are provided in the main body of the report or in this Glossary, where appropriate. Carried interest is equivalent to a performance fee. This represents a share of the profits that will accrue to the underlying private equity managers, after achievement of an agreed Preferred Return. Co-investment is a Direct Investment in a company alongside a private equity fund. Co-investment Incentive Scheme Accrual represents the estimated value of interests in the Co-investment Incentive Scheme operated by the subsidiary partnerships of the Company. Commitment represents the amount of capital that each Limited Partner agrees to contribute to the fund, which can be drawn at the discretion of the General Partner. Deployment please see ‘Total new investment’. Direct Investments please see ‘Co-investment’. Discount arises when the Company’s shares trade at a price below the Company’s NAV per Share. In this circumstance, the price that an investor pays or receives for a share would be less than the value attributable to it by reference to the underlying assets. The Discount is the difference between the share price and the NAV, expressed as a percentage of the NAV. For example, if the NAV was 100p and the share price was 90p, the Discount would be 10%. Drawdowns are amounts invested by the Company into funds when called by underlying managers in respect of an existing Commitment. EBITDA stands for earnings before interest, tax, depreciation and amortisation, which is a widely used performance measure in the private equity industry. Enterprise Value (‘EV’) is the aggregate value of a company’s entire issued share capital and Net Debt. General Partner (‘GP’) is the entity managing a private equity fund. This is commonly referred to as the manager. Hedging is an investment technique designed to offset a potential loss on one investment by purchasing a second investment that is expected to perform in the opposite way. High Conviction Investments comprise Direct Investments, as well as investments in ICG-managed funds and Secondary Investments. Initial Public Offering (‘IPO’) is an offering by a company of its share capital to the public with a view to seeking an admission of its shares to a recognised stock exchange. Internal Rate of Return (‘IRR’) is a measure of the rate of return received by an investor in a fund. It is calculated from cash drawn from and returned to the investor, together with the residual value of the investment. Investment Period is the period in which funds are able to make new investments under the terms of their fund agreements, typically up to five years after the initial Commitment. Last Twelve Months (‘LTM’) refers to the time frame of the immediately preceding 12 months in reference to a financial metric used to evaluate the Company’s performance. Limited Partner (‘LP’) is an institution or individual who commits capital to a private equity fund established as a Limited Partnership. These funds are generally protected from legal actions and any losses beyond the original investment. Limited Partnership includes one or more General Partners, who have responsibility for managing the business of the partnership and have unlimited liability, and one or more Limited Partners, who do not participate in the operation of the partnership and whose liability is ordinarily capped at their capital and loan contribution to the partnership. In typical fund structures, the General Partner receives a priority share ahead of distributions to Limited Partners. Net Asset Value (‘NAV’) per Share is the value of the Company’s net assets attributable to one ordinary share. It is calculated by dividing shareholders’ funds by the total number of ordinary shares in issue. Shareholders’ funds are calculated by deducting current and long-term liabilities, and any provision for liabilities and charges, from the Company’s total assets. Net Asset Value (‘NAV’) per Share Total Return is the change in the Company’s Net Asset Value per Share, assuming that dividends are re-invested at the end of the quarter in which the dividend was paid. Exclusion List defines the business activities which are excluded from investment. Net Debt is calculated as the total short-term and long-term debt in a business, less cash and cash equivalents. FTSE All-Share Index Total Return is the change in the level of the FTSE All-Share Index, assuming that dividends are re-invested on the day that they are paid. Full Exits are exit events (e.g., trade sale, sale by public offering, or sale to a financial buyer) following which the residual exposure to an underlying company is zero or immaterial; this does not include Fund Disposals. See ‘Fund Disposals’. Fund Disposals are where the Company receives sales proceeds from the full or partial sale of a fund position within the secondary market. Ongoing Charges are calculated in line with guidance issued by the Association of Investment Companies (‘AIC’) and capture management fees and expenses, excluding finance costs, incurred at the Company level only. The calculation does not include the expenses and management fees incurred by any underlying funds. 96 ICG Enterprise Trust Plc Annual Report and Accounts 2022 FY22 Management fees General expenses Finance costs Total Total Ongoing Charges Average NAV Ongoing Charges as % of NAV Total per income statement £’000 13,417 2,082 2,565 18,064 Amount excluded from AIC ongoing charges £’000 – 491 2,565 3,056 Included ongoing charges £’000 13,417 1,591 – 15,008 15,008 1,070,494 1.40% The amount of general expenses excluded from AIC Ongoing Charges includes £234,000 of legal and professional costs incurred in connection with the bank facility, as finalised with Credit Suisse during February 2021. FY21 Management fees General expenses Finance costs Total Total Ongoing Charges Average NAV Ongoing Charges as % of NAV Total per income statement £’000 10,728 1,447 2,623 14,798 Amount excluded from AIC ongoing charges £’000 – 8 2,623 2,631 Included ongoing charges £’000 10,728 1,439 – 12,167 12,167 834,566 1.46% Other Net Liabilities at the aggregated Company level represent net other liabilities per the Company’s balance sheet. Net other liabilities per the balance sheet of the subsidiaries are amounts payable under the Co-investment Incentive Scheme Accrual. Overcommitment refers to where private equity fund investors make Commitments exceeding the amount of cash immediately available for investment. When determining the appropriate level of Overcommitment, careful consideration needs to be given to the rate at which Commitments might be drawn down, and the rate at which realisations will generate cash from the existing Portfolio to fund new investment. Portfolio represents the aggregate of the investment Portfolios of the Company and of its subsidiary Limited Partnerships. This APM is consistent with the commentary in previous annual and interim reports. The Board and the Manager consider that disclosing our Portfolio assists shareholders in understanding the value and performance of the underlying investments selected by the Manager. It is shown before the Co-investment Incentive Scheme Accrual to avoid being distorted by certain funds and Direct Investments on which ICG Enterprise Trust Plc does not incur these costs (for example, on funds managed by ICG plc). Portfolio is related to the NAV, which is the value attributed to our shareholders, and which also incorporates the Co-investment Incentive Scheme Accrual as well as the value of cash retained on our balance sheet. The value of the Portfolio at 31 January 2022 is £1,172.2m (2021: £949.2m). The closest equivalent amount reported on the balance sheet is ‘investments at fair value’. A reconciliation of these two measures along with other figures aggregated for the Company and its subsidiary Limited Partnerships is presented below: 31 January 2022 £m Investments1 Cash Other Net Liabilities Net assets 31 January 2021 £m Investments1 Cash Other Net Liabilities Net assets IFRS balance sheet fair value Net assets of subsidiary limited partnerships Co-investment Incentive Scheme Accrual Total Company and subsidiary Limited Partnerships 1,123.7 41.3 (7.1) 1,157.9 (0.6) – 0.6 – 49.1 – (49.1) – 1,172.2 41.3 (55.6) 1,157.9 IFRS balance sheet fair value Net assets of subsidiary Limited Partnerships Co-investment Incentive Scheme Accrual Total Company and subsidiary Limited Partnerships 907.6 45.2 (0.7) 952.1 (0.2) – 0.2 – 41.8 – (41.8) – 949.2 45.2 (42.3) 952.1 1 Investments as reported on the IFRS balance sheet at fair value comprise the total of assets held by the Company and the net asset value of the Company’s investments in the subsidiary Limited Partnerships. Portfolio Return on a Local Currency Basis represents the change in the valuation of the Company’s Portfolio before the impact of currency movements and Co-investment Incentive Scheme Accrual. The Portfolio return of 29.4% is calculated as follows: £m Income, gains and losses on investments Foreign exchange gains and losses included in gains and losses on investments Incentive accrual valuation movement Total gains on Portfolio investments excluding impact of foreign exchange Opening Portfolio valuation Portfolio Return on a Local Currency Basis FY22 245.5 17.2 16.7 279.4 949.2 29.4% FY21 190.6 (12.2) 22.2 200.6 806.4 24.9% A reconciliation between the Portfolio Return on Local Currency Basis and NAV per Share Total Return is disclosed under ‘Total Return’. Portfolio Company refers to an individual company in an investment portfolio. Preferred Return is the preferential rate of return on an individual investment or a portfolio of investments, which is typically 8% per annum. Premium occurs when the share price is higher than the NAV and investors would therefore be paying more than the value attributable to the shares by reference to the underlying assets. Quoted Company is any company whose shares are listed or traded on a recognised stock exchange. Realisation Proceeds are amounts received in respect of underlying realisation activity from the Portfolio and exclude any inflows from the sale of fund positions via the secondary market. ICG Enterprise Trust Plc Annual Report and Accounts 2022 97 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONGlossary (unaudited) continued Realisations – Multiple to Cost is the average return from Full Exits from the Portfolio in the period on a primary investment basis, weighted by cost. Total Return is a performance measure that assumes the notional re-investment of dividends. This is a measure commonly used by the listed private equity sector and listed companies in general. £m Cumulative realisation proceeds from full exits in the year Cost Average return Multiple to Cost FY22 211.5 108.1 2.6x FY21 85.7 35.6 2.4x Realisations – Uplift to Carrying Value is the aggregate uplift on Full Exits from the Portfolio in the period excluding publicly listed companies that were exited via sell downs of their shares. £m Realisation proceeds from Full Exits in the year Prior Carrying Value (at previous quarterly valuation prior to exit) Realisation – Uplift to Carrying Value FY22 210.5 154.4 36% FY21 78.0 59.7 31% Secondary Investments occur when existing private equity fund interests and Commitments are purchased from an investor seeking liquidity. Share Price Total Return is the change in the Company’s share price, assuming that dividends are re-invested on the day that they are paid. Total New Investment is the total of direct Co-investment and fund investment Drawdowns in respect of the Portfolio. In accordance with IFRS 10, the Company’s subsidiaries are deemed to be investment entities and are included in subsidiary investments within the financial statements. Movements in the cash flow statement within the financial statements reconcile to the movement in the Portfolio as follows: £m Purchase of Portfolio investments per cash flow statement Purchase of Portfolio investments within subsidiary investments Total New Investment FY22 75.1 228.8 FY21 86.1 53.1 The table below sets out the share price and the Net Asset Value per Share growth figures for periods of one, three, five and 10 years to the balance sheet date on a Total Return basis: Total Return performance in years to 31 January 2022 1 year 3 years 5 years 10 years Net Asset Value per Share +24.4% +69.3% +114.2% +257.5% Share price +27.1% +57.5% +94.9% +325.5% FTSE All-Share Index +18.9% +21.7% +30.2% +104.4% The table below shows the breakdown of the one-year Net Asset Value per Share Total Return for the period: Change in NAV (% of opening NAV) Portfolio return on a Local Currency Basis Currency movements in the Portfolio Portfolio return in sterling Effect of cash drag Impact of net Portfolio movement on net asset value Expenses and other income Co-investment Incentive Scheme Accrual Increase in Net Asset Value per Share before buybacks Impact of share buybacks & dividend reinvestment Net asset value per share Total Return FY22 29.4% (1.8%) 27.6% (0.1%) 27.5% (1.5%) (1.8%) 24.2% 0.2% 24.4% FY21 24.9% 1.5% 26.4% 0.4% 26.8% (1.9%) (2.8%) 22.1% 0.4% 22.5% Undrawn Commitments are Commitments that have not yet been drawn down (please see ‘Drawdowns’). Unquoted Company is any company whose shares are not listed or traded on a recognised stock exchange. 303.7 139.2 Valuation Multiples are earnings (EBITDA), or revenue multiples applied in determining the value of a business enterprise. Venture Capital refers to financing provided to a company in the earlier stages of its lifecycle, either at the concept, start-up, or early stage of that company’s development. Total Proceeds are amounts received by the Company in respect of the Portfolio, which may be in the form of capital proceeds or income such as interest or dividends. In accordance with IFRS 10, the Company’s subsidiaries are deemed to be investment entities and are included in subsidiary investments within the financial statements. Movements in the cash flow statement within the financial statements reconcile to the movement in the Portfolio as follows: £m Sale of Portfolio investments per cash flow statement Sale of Portfolio investments, interest received and dividends received within subsidiary investments Interest income per cash flow statement Dividend income per cash flow statement Total Proceeds Fund Disposals Realisation Proceeds FY22 101.0 236.4 2.0 1.6 342.9 9.4 333.5 FY21 147.5 55.1 1.2 5.4 209.2 71.9 137.3 98 ICG Enterprise Trust Plc Annual Report and Accounts 2022 Shareholder information Address ICG Enterprise Trust Plc Procession House 55 Ludgate Hill London EC4M 7JW 020 3545 2000 Registered number: 01571089 Place of registration: England Website www.icg-enterprise.co.uk Registrar Computershare Investor Services PLC The Pavilions Bridgwater Road Bristol BS99 6ZZ • www-uk.computershare.com/investor • Telephone: 0370 889 4091 BMO savings schemes Investors through BMO savings schemes can contact the Investor Services team on: • Telephone: 0345 600 3030 • Email: investor.enquiries@bmogam.com Financial calendar The announcement and publication of the Company’s results may normally be expected in the months shown below: April/May: Final results for year announced, Annual Report and Accounts published June: Annual General Meeting and first quarter’s results announced October: Interim figures announced and half-yearly report published January: Third quarter’s results announced All announcements can be viewed on the Company’s website (see above). Manager ICG Alternative Investment Limited Procession House 55 Ludgate Hill London EC4M 7JW 020 3545 2000 Authorised and regulated by the Financial Conduct Authority (FRN: 606186). Broker Numis Securities Limited 45 Gresham Street London EC2V 7BF Dividend: 2021/2022 Quarterly dividends of 6.0p were paid on: • 3 September 2021 • 3 December 2021 • 4 March 2022 A final dividend of 9p is proposed in respect of the year ended 31 January 2022, payable as follows: Ex-dividend date: 7 July 2022 (shares trade without rights to the dividend). Record date: 8 July 2022 (last date for registering transfers to receive the dividend). Dividend payment date: 22 July 2022. 2022/23 dividend payment dates Quarterly dividends will be paid in the following months: • September 2022 • December 2022 • March 2023 • July 2023 Payment of dividends Cash dividends will be sent by cheque to the first-named shareholder at their registered address, to arrive on the payment date. Alternatively, dividends may be paid direct into a shareholder’s bank account via Bankers’ Automated Clearing Service (‘BACS’). This can be arranged by contacting the Company’s registrar, Computershare Investor Services PLC (see contact details on this page). Share price The Company’s mid-market ordinary share price is published daily in the Financial Times and Daily Telegraph under the section ‘Investment Companies’. In the Financial Times the ordinary share price is listed in the sub-section ‘Conventional-Private Equity’. Registrar services Communications with shareholders are mailed to the address held in the share register. Any notifications and enquiries relating to the registered share holdings, including a change of address or other amendment, should be directed to Computershare Investor Services PLC (details on this page). For those shareholders that hold their shares through the BMO savings schemes, please contact the Investor Services team (details on this page). E-communications for shareholders ICG Enterprise Trust Plc would like to encourage shareholders to receive shareholder documents electronically, via our website or email notification instead of hard copy format. This is a faster and more environmentally friendly way of receiving shareholder documents. The online investor centre from our registrar, Computershare, provides all of the information required regarding your shares. Its features include: • The option to receive shareholder communications electronically instead of by post. • Direct access to data held for you on the share register including recent share movements and dividend details. • The ability to change your address or dividend instructions online. To receive shareholder communications electronically in the future, including all reports and notices of meetings, you just need the Shareholder Reference Number (‘SRN’) printed on your proxy form or dividend notices, and knowledge of your registered address. Please register your details free at www.investorcentre.co.uk. For those shareholders that hold their shares through the BMO savings schemes, please contact the BMO Investor Services team (details on this page) to register your detail for e-communications. ISIN/SEDOL numbers The ISIN/SEDOL numbers and ticker for the Company’s ordinary shares are: ISIN: SEDOL: Reuters: GB0003292009 0329200 ICGT.L AIC The Company is a member of the Association of Investment Companies (www.theaic.co.uk). Legal notice ‘FTSE’ is a trade mark of certain LSE Group companies. All rights in any FTSE index or data referred to herein vest in the relevant LSE Group company which owns the index or the data. Neither LSE Group nor its licensors accept any liability for any errors or omissions in the indexes or data and no party may rely on any indexes or data contained in this communication. The LSE Group does not promote, sponsor or endorse the content of this communication. ICG Enterprise Trust Plc Annual Report and Accounts 2022 99 STRATEGIC REPORTGOVERNANCEFINANCIAL STATEMENTSOTHER INFORMATIONHow to invest in ICG Enterprise Trust Plc ICG Enterprise Trust Plc is listed on the London Stock Exchange and its shares can be bought and sold just as those of any other listed company. A straightforward way for individuals to purchase and hold shares in the Company is to contact a stockbroker, savings plan provider or online investment platform. You may be able to find a stockbroker using the website of the independent Wealth Management Association (‘WMA’) at www.pimfa.co.uk. You may also be able to purchase shares via your bank account provider. For a small fee, your chosen intermediary can purchase shares in the Company on your behalf. BMO savings schemes Investors through BMO savings schemes can contact the Investor Services team on: • Telephone: 0345 600 3030 • Email: investor.enquiries@bmogam.com ISA status The Company’s shares are eligible for tax-efficient wrappers such as Individual Savings Accounts (‘ISAs’), Junior ISAs, and Self Invested Personal Pensions (‘SIPPs’). Information about ISAs and SIPPs, as well as general advice on saving and investing, can be found on the government’s free and independent service at www.moneyhelper.org.uk. As with any investment into a company listed on the stock market, you should remember that: • the value of your investment and the income you get from it can fall as well as rise, so you may not get back the amount you invested; and • past performance is no guarantee of future performance. This is a medium to long-term investment so you should be prepared to invest your money for at least five years. If you are uncertain about any aspect of your decision to invest, you should consider seeking independent financial advice. Details of the Company’s website and contact information for potential and existing shareholders can be found in the Shareholder information section on the previous page. 100 ICG Enterprise Trust Plc Annual Report and Accounts 2022 This report has been printed on Arena Extra White Smooth which is certified by the Forest Stewardship Council® (‘FSC®’). The FSC® is a worldwide label which identifies products obtained from sustainable and responsible forest management. Printed by the Pureprint Group using the latest environmental printing technology and vegetable-based inks. Pureprint group is a CarbonNeutral® company, registered with the Environmental Management System ISO 14001 and is FSC® chain-of-custody certified. The unavoidable carbon emissions generated during the manufacturing and delivery of this document have been reduced to net zero through a verified carbon offsetting project. Designed and produced by three thirty studio www.threethirty.studio ICG ENTERPRISE TRUST PLC Procession House 55 Ludgate Hill London EC4M 7JW www.icg-enterprise.co.uk 

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