JZ Capital Partners : Annual Report for the Year Ended 28 February 2023

JZ CAPITAL PARTNERS LIMITED

Annual Report and Financial Statements For the year ended 28 February 2023

Contents

Who We Are	1
Performance and Results Highlights	2
Annual Review
Chairman's Statement	4
Investment Adviser's Report	6
Investment Portfolio	12
Directors' Report
Board of Directors	17
Report of the Directors	18
Corporate Governance	26
Directors' Remuneration Report	31
Audit Committee Report	32
Independent Auditor's Report	36
Financial Statements
Statement of Comprehensive Income	48
Statement of Financial Position	49
Statement of Changes in Equity	50
Statement of Cash Flows	51
Index to Notes to the Financial Statements	52
Notes to the Financial Statements	53
Other Information
Company Advisers	89
Useful Information for Shareholders	90
Notice of Annual General Meeting	96
Form of Proxy	103

Numbers in the Annual Report and Financial Statements are quoted in US dollar ("$") unless otherwise stated.

Annual Report and Financial Statements

1

Who We Are

Corporate Objective

JZ Capital Partners Limited ("JZCP" or the "Company") seeks to maximise the value of its investments in its US and European micro-cap companies and US real estate, to repay debt and to return capital to shareholders.

About Us

JZCP has investments in US and European micro-cap companies, as well as real estate properties in the US.

JZCP's Investment Adviser is Jordan/Zalaznick Advisers, Inc. ("JZAI") which was founded by David Zalaznick and Jay Jordan in 1986. JZAI is supported by teams of investment professionals in New York, Chicago, London and Madrid.

In August 2020, the Company's shareholders approved changes to the Company's investment policy. Under the new policy, the Company will make no further investments except in respect of which it has existing obligations or to continue selectively to support the existing portfolio. The intention is to realise the maximum value of the Company's investments and, after repayment of all debt, to return capital to shareholders.

JZCP is a Guernsey domiciled closed-ended investment company authorised by the Guernsey Financial Services Commission. JZCP's shares trade on the Specialist Fund Segment of the London Stock Exchange.

2 Annual Report and Financial Statements

Performance and Results Highlights

Realisations During the Year

During the year ended 28 February 2023, the Company received distributions and realisation proceeds in excess of $184 million.

		Proceeds
Assets	Portfolio	($ million)
JZHL Secondary Fund
Distributions following the successful realisations of Flow Control and Testing
Services	U.S.	97.4
Deflecto Holdings - Evriholder	U.S.	54.3
Industrial Services Solutions	U.S.	22.5
New Vitality	U.S.	7.4
Others including escrow receipts		2.5
		184.1

Net Asset Value ("NAV") per Share and Total NAV Returns

NAV per share at 28 February 2023 was $4.06. The NAV per share at 28 February 2022, as reported in the Annual Report and Financial Statements dated 14 June 2022 was $4.29, due to a prior period restatement this has subsequently been adjusted to $4.031. Based on the previous reported NAV per share at 28 February 2022 of $4.29, the Total NAV return was -5.4%.

	1 Year1	3 Year	5 Year	7 Year
Total NAV return	0.7%	-33.9%	-59.3%	-58.8%

Following table presents the Company's annual NAV performance by sector:

NAV Attribution Per Ordinary Share

$4.60
$4.40				$0.34									$0.01	$0.02
									$0.09
$4.20																												$0.01	$4.06
$4.03				($0.20)												($0.11)
$4.00																									($0.13)
$3.80
$3.60
$3.40
$3.20
$3.00
	NAV at 1 March 2022		+ US micro-cap		+ European micro-cap		- Real estate		- Other portfolio			- Listed investments			- Finance costs		- Expenses and taxation		- Other foreign exchange		NAV at 28 February 2023
													Increase		Decrease		Total

1 The prior year NAV per share as at 28 February 2022, has been restated to $4.03 per share ($4.29 per share before restatement). Unless otherwise specified, returns and performance data throughout this Annual Report and Financial Statements assume the restated NAV per share at 28 February 2022. Further details on this prior year reclassification and remeasurement can be found in Note 2 to the Financial Statements.

Annual Report and Financial Statements	3

Shareholder Returns

JZCP's share price at 28 February 2023 was £1.58 (28 February 2022: £1.05).

	1 Year	3 Year	5 Year	7 Year
Total Shareholder return	50.0%	-39.0%	-65.1%	-59.5%

NAV to Market Price Discount

The data below shows the theoretical discount of the year end share price and the year end NAV per share and does not factor in the timing delay in announcing the year end NAV to the market.

	29.2.2016	28.2.2018	29.2.2020	28.2.2022	28.2.2023
Discount	45.5%	37.7%	46.3%	65.0%	53.0%

NAV per share versus Share price

$12.00		$10.85
	$10.25	$10.15	$10.12		$10.04
$10.00		$9.98
$8.00	$7.46			$6.69
		$6.32		$6.21
				$5.79	$6.14
$6.00			$5.53
							$4.25
								$4.03	$4.06
$4.00
						$3.30
$2.00									$1.41	$1.91
							$1.09
$0.00	February	February	February	February	February	February	February	February	February	February
	2014	2015	2016	2017	2018	2019	2020	2021	2022	2023

NAV per Share		Share price ($ equivalent of £ quoted price)

Total NAV return, Total Shareholder returns and NAV to Market Price discount, are classified as Alternative Performance Measurements under European Securities and Market Authority guidelines and are further explained on page 90 under Useful Information for Shareholders.