JPMorgan Mid Cap Investment Trust : JMF- Annual Report and Financial Statements – 30th June 2022

JPMorgan Mid Cap Investment Trust plc

Selecting the stars of the FTSE 250

Annual Report & Financial Statements for the year ended 30th June 2022

Key Features

Objective

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

Investment Policies

• To focus on FTSE 250 stocks that deliver strong capital growth.
• To have significant exposure to the UK economy, with selective exposure to overseas earnings.
• To seek out both value stocks and growth stocks, including AIM stocks, to deliver strong performance throughout the market cycle.
• To use gearing, as appropriate, to increase potential returns to shareholders.
• To invest no more than 15% of gross assets in other UK listed investment companies (including investment trusts).

Benchmark

The FTSE 250 Index (excluding investment trusts).

Capital Structure

• UK domiciled.
• Premium Listing on the London Stock Exchange.
• As at 30th June 2022, the Company's called-up share capital comprised 25,398,080 Ordinary shares of 25p each including 2,854,350 shares held in Treasury.

Management Company and Company Secretary

The Company employs JPMorgan Funds Limited ('JPMF' or the 'Manager') as its Alternative Investment Fund Manager and Company Secretary. JPMF delegates the management of the Company's portfolio to JPMorgan Asset Management ('JPMAM').

Environment, Social and Governance ('ESG') Considerations

ESG considerations are fully integrated into the Company's stock selection process. JPMAM research teams compile proprietary ESG analyses on each company as well as using external vendor research to rank them. Following in-depth strategic and financial analysis, these ESG rankings and factors are also taken into consideration as part of the investment case. In addition, the Manager, together with stewardship specialists, engages with investee companies on specific ESG issues. JPMAM is a United Nations Principles of Responsible Investment ('UN PRI') signatory and endeavours to vote at all of the meetings called by companies in which your portfolio invests. The Manager reports to the Board on its ESG considerations on a regular basis and an ESG report is on pages 14 to 16.

Financial Conduct Authority ('FCA') Regulation of 'non-mainstream pooled investments' and MiFID II 'complex investments'

The Company currently conducts its affairs so that the shares issued by the Company can be recommended by independent financial advisers to ordinary retail investors in accordance with the FCA's rules in relation to non-mainstream investment products and intends to continue to do so for the foreseeable future.

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

Association of Investment Companies ('AIC')

The Company is a member of the AIC.

Website

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

2	JPMorgan Mid Cap Investment Trust plc - Annual Report & Financial Statements 2022

Key Features

• The UK Mid Cap Index has been one of the strongest indices in the world over the longer term. The Index has not been immune to the significant market turmoil over the last six months, however, we believe that in spite of all the recent headwinds, the reasons behind that strong performance remain intact and the Mid Cap arena will continue to punch above its weight."
  Georgina Brittain, Investment Manager, JPMorgan Mid Cap Investment Trust plc
• • The Mid Cap Index is full of exciting companies operating in structural growth areas, many of whom are world leaders in the niche they operate in, yet, still a relatively undiscovered part of the UK market. The Company can move swiftly between UK-focused and globally-focused companies, as well as growth and value tilts, whilst utilising our disciplined investment approach in selecting the stars of the FTSE 250."
    Katen Patel, Investment Manager, JPMorgan Mid Cap Investment Trust plc

JPMorgan Mid Cap Investment Trust plc provides access to this dynamic area of the UK stock market. It focuses on selecting the stars of the FTSE 250, ranging from industry leaders with the potential to graduate to the FTSE 100, to the less-established companies that are at an earlier stage of their growth trajectory.

Mid cap champions

The Investment Managers believe UK mid cap companies present a unique and compelling investment opportunity - a view that's backed up by the sector's long-term outperformance: over the last 25 years, the FTSE 250 Index (excluding Investment Trusts) has significantly outperformed nearly every other major equity index.

Many mid cap companies are (or could be) leaders in their specific markets. JPMorgan Mid Cap Investment Trust plc has the ability to invest in these companies before they enter the FTSE 250 or at IPO stage, which is often before their stock prices reflect their full potential.

Mid cap companies offer active investors several other unique advantages. The diversity of the mid cap universe - the ten largest stocks in the FTSE 250 make up just 11% of the index compared with four times that in the FTSE 100 - means more opportunities to find winners. Mid cap companies are also often merger and acquisition targets of larger companies that are seeking to augment their growth and are willing to pay a premium to market valuations. Lastly, mid caps tend to be less researched than large caps, meaning a well-resourced, diligent investment manager can spot opportunities that others might overlook.

Conviction investors

Our experienced, dedicated mid cap portfolio management team uses a rigorous 'value, quality and momentum' process to seek out investment candidates that possess the attributes for success. The portfolio managers have access to extensive small and mid cap research resources, allowing them to get to know companies inside out. When they do invest, it is with high conviction and with bolder positions than the index or other managers. The Company can move swiftly between UK-focused and globally-focused companies, as well as growth and value tilts, as market conditions require. The Investment Managers have the freedom to hold onto successful investments as they graduate to the FTSE 100.

J.P. Morgan Asset Management

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Contents

Strategic Report

Financial Highlights	6
Chairman's Statement	8
Investment Managers' Report	12
Environmental, Social and Governance ('ESG') Report	14
Ten Year Record	17
Portfolio Information	19
Business Review	22
Principal Risks	25
Long Term Viability	28
Duty to Promote the Success of the Company	29

Directors' Report

Board of Directors	33
Directors' Report	34
Corporate Governance Statement	36
Audit & Risk Committee Report	41
Directors' Remuneration Report	44
Statement of Directors' Responsibilities	48
Independent Auditor's Report	50
Financial Statements
Statement of Comprehensive Income	57
Statement of Changes in Equity	57
Statement of Financial Position	58
Statement of Cash Flows	59
Notes to the Financial Statements	60
Regulatory Disclosures
Alternative Investment Fund Managers Directive ('AIFMD') Disclosure	75
(Unaudited)
Securities Financing Transactions Regulation Disclosure (Unaudited)	75
Shareholder Information
Notice of Annual General Meeting	77
Glossary of Terms and Alternative Performance
Measures ('APMs') (Unaudited)	81
Where to Buy J.P. Morgan Investment Trusts	83
Information about the Company	84

4	JPMorgan Mid Cap Investment Trust plc - Annual Report & Financial Statements 2022

Strategic Report