Oryx International Growth Fund : Annual Report 31 March 2023

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Annual Report and Financial Statements for the year ended 31 March 2023

Index

	Page
Strategic Report
Company Overview	1
Chairman's Statement	2
Investment Manager's Report	3
Ten Largest Holdings	5
Investment Schedule	8
Directors' Report	17
Corporate Governance Report	22
Audit Committee Report	33
Directors' Remuneration Report	37
Statement of Directors' Responsibilities	39
Independent Auditor's Report	41
Statement of Comprehensive Income	50
Statement of Financial Position	51
Statement of Changes in Equity	52
Statement of Cash Flows	53
Notes to the Financial Statements	54
Alternative Performance Measures	73
Company Information	Inside back cover

Oryx International Growth Fund Limited

Strategic Report

Company Overview

Key Figures

	At 31 March	At 31 March
(£ in millions, except per share data)	2023	2022
Net Asset Value ("NAV") attributable to shareholders
- Ordinary Shares	206.43	219.41
Investments	193.04	208.89
Cash and cash equivalents	15.59	10.62
NAV per share attributable to shareholders
- Ordinary Shares	14.75	15.67
Share Price	11.95	14.80
Discount to NAV	(18.98%)	(5.55%)
Loss per share	(0.93)	(0.75)

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Oryx International Growth Fund Limited

Strategic Report Chairman's Statement

2023 was a difficult year with the well trailed problems of the world impacting on the investment world. In the light of this background, while the overall decline in NAV amounted to 5.91%, all of this took place in the first half of the year where a decline of 14.61% was reported, the second half saw a gain of 9.76%. This recovery goes to the heart of our investment philosophy which is only to invest in companies which offer good value, have strong balance sheets and prospects that can be unlocked through active management. I am also pleased to report that this momentum has continued into this year with a further increase in net assets of 4.88% being recorded at the end of May. It is also worth noting that in the three years to 31st March, our NAV grew by 68% and over a ten year period by 297%.

During the Company's lifetime, the Board has often been faced with the question of where our next opportunities are going to be found. As you can see from the Investment Manager's report below, the year under review has seen some successful disposals with our cash position increasing by £5m to £15.5m during the course of the year. But, as is also pointed out in the same report, periods of financial stress throw up opportunities and it will allow investments to be found at more reasonable valuations thereby offering rewards for the future.

During the course of the year, we saw both Rupert Evans and Waleed Chatila retire from the board. Rupert, a leading lawyer in Guernsey, served from the Company's founding in 1996 and his years of wise advice were much appreciated and will be missed. Likewise, Waleed, who also chaired our Audit Committee, contributed over 19 years of service with his broad knowledge of both the commercial and investment world. I would like to record the sincere thanks of both the Board and the shareholders for their contribution to the long-term success of the business. I am also pleased to welcome to the Board,

Gavin Farrell, again a leading Guernsey lawyer and Jamie Brooke, an acknowledged investor in small companies.

In line with our stated policy, the Board do not intend to pay a dividend. It is difficult to predict any particular outcome particularly with the constant drip of uncertainty and unwelcome economic news. However, on one matter I am convinced and that is quality will win in the long term. Christopher Mills and the team surrounding him at Harwood have demonstrated that the strategy of investing in good companies with excellent prospects will deliver strong long-term rewards and with that in mind, we look forward to the future with confidence.

Nigel Cayzer

Chairman

5 July 2023

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Oryx International Growth Fund Limited

Strategic Report

Investment Manager's Report

The Company's NAV declined by 5.9% in a year where our comparative indices fell by 19% on average in a difficult year for UK small cap equities.

Global markets faced continued turbulence, with interest rates facing additional raises to counter high inflation. Though several leading inflationary indicators have reduced in recent months, wage inflation remains steady and continues to burden businesses with higher costs. The war in Ukraine continues, with a counter offensive reportedly underway but no clarity on a near term ceasefire. The banking sector saw disruption not seen since the global financial crisis as Silicon Valley Bank collapsed as a result of a bank run on deposits. This sparked a collapse in share prices across US regional banks and most shockingly, the demise of Credit Suisse, which was subsequently acquired by UBS in a Swiss government supported rescue.

Mortgage rates have continued to climb, suppressing demand in the housing sector and curtailing construction by house builders. Energy prices climbed significantly during the year but have since reduced as the energy cap comes down. International pension schemes have reduced exposure to UK equities and mutual funds faced continued outflows, putting pressure on share prices.

Overall, 2022 was a difficult year for the UK and global equity markets. While there is reason for pessimism, the outflow of capital from UK small caps has provided our Company with ample opportunity to acquire significant stakes in companies at discounted values. Several large and small UK public companies were subject to take over bids during the course of the year, with particular interest arriving from overseas buyers looking to take advantage of suppressed valuations. Importantly, some of our significant holdings were subject to bids during the

year, providing the Company with ample liquidity for 2023 and beyond as detailed below.

Quoted equities:

The 2022 financial year saw several of our core positions being subjected to takeover bids, with the offer for Sureserve Plc arriving after the March year end. Crestchic Plc received a bid from Aggreko, generating a 139% return on our initial investment and circa £12 million in cash returned to the Company. The Sureserve bid at 125p marks a 268% return on initial investment and 50.6% year on year, returning

£12.5 million to the Company. Curtis Banks Plc received an offer of 350p from Nucleus Financial group, while two of our smaller holdings Fulham Shore Plc and Seraphine Plc were also bid for. Lastly, Smoove Plc has received interest from Australia based PEXA for an unspecified amount, causing the shares to gain 39% upon announcement. Taken together, the above transactions will provide (pending completion) circa £40 million of cash to deploy in future investments.

Niox Group Plc and Kitwave Group Plc were standout performers in the year and have continued to outperform the market since our March year end. The position in Kitwave Group, a wholesale distribution business that engages in value accretive bolt on M&A, was built in the prior year so we are pleased with the good performance of the business thus far. The management team at Niox Group Plc have delivered on their cost reduction targets, with the process now complete and the focus now on growing sales in the US and Asia.

The underperformers among our significant holdings were Hargreaves Services Plc, EKF Diagnostics and Tribal Group. Hargreaves Services had previously enjoyed a year of 'super profits' from its German JV business as pig iron and zinc prices skyrocketed and while those have started to come down, the rest of the business has performed well. The net asset value

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