City Natural Resources Growth and Income PLC (LON:CYN) has announced its Annual Financial Report for the year ended 30 June 2026
This announcement contains regulated information
The statements below are extracted from the Company’s Annual Report for the year ended 30 June 2026. The Annual Report, which includes the notice of the Company’s forthcoming annual general meeting, will be posted to shareholders at the beginning of November 2026. Members of the public may obtain copies from Frostrow Capital LLP, 25 Southampton Buildings, London WC2A 1AL or from the Company’s website at https://citynats.com/ where up to date information on the Company, including daily NAV, share prices and fact sheets, can also be found.
Full year highlights
- Net asset value (NAV) per share total return of 76.6%, outperforming the MSCI World Metals and Mining Index (63.5%) and MSCI World Energy Index (34.1%).
- Share price total return of 87.0% (2025: 9.3%).
- Dividend yield of 8.3% at the year end, comprising four interim dividends totalling 28.30p per share in respect of the year (2025: 8.03p per share).
- Issuance of 2,150,000 shares from treasury during the year during periods of demand-driven sustained share price premium to NAV. Discount to NAV of 1.2% at year-end (June 2025: 6.1%).
Post-period end events
- Issuance of a further 3,965,000 shares from treasury to satisfy investor demand following the year end.
- The Company changed its name to City Natural Resources Growth & Income PLC with effect from 15 September 2026.
- Tufton became the Company’s Investment Manager, and Keith Watson and Robert Crayfourd resumed responsibility for the Company’s portfolio.
- First interim dividend (2027) of 7.88p per share declared in October 2026.
Investment highlights
- Strong performance driven principally by the Company’s exposure to the precious metals rally, with profits subsequently taken and reallocated towards energy as the geopolitical backdrop evolved.
- Increased exposure to oil and gas, shipping and related energy sectors, which benefited from disruption in the Middle East.
- Positive outlook for natural resources, supported by geopolitical uncertainty, energy security and increasing demand for energy and critical materials associated with AI and data-centre growth.
Key Metrics
for the year ended 30 June:
| Net asset value total return1 | Share price total return1 | ||
| 2026 | 2025 | 2026 | 2025 |
| 76.6% | 4.6% | 87.0% | 9.3% |
| MSCI World Metals and Mining Index total return (sterling adjusted)2 | MSCI World Energy Index total return (sterling adjusted)2 | ||
| 2026 | 2025 | 2026 | 2025 |
| 63.5% | (4.5)% | 34.1% | (7.7)% |
| Dividend yield1 | Dividend per share (pence) | ||
| 2026 | 2025 | 2026 | 2025 |
| 8.3% | 4.0% | 28.30p | 8.03p |
Total return performance (cumulative)
| Since | ||||
| 1 Year | 3 Years | 5 Years | inception* | |
| Net asset value per share | 76.6% | 98.2% | 147.5% | 1,273.6% |
| Share price | 87.0% | 139.5% | 169.4% | 1,440.5% |
| MSCI World Metals and Mining Index (sterling adjusted)2 | 63.5% | 68.4% | 102.5% | 843.3% |
| MSCI World Energy Index (sterling adjusted)2 | 34.1% | 45.3% | 139.6% | 694.7% |
* 31 July 2003.
1 Alternative Performance Measure (“APM”). A glossary of the terms used, including alternative performance measures, can be found below.
2 Used by the Company as a comparator, not a benchmark. As at 30 June 2026, 48.3% of the portfolio was attributable to the MSCI World Metals and Mining Index and 49.8% of the portfolio to the MSCI World Energy Index. Please refer to the ‘by commodity’ data below for further detail.
Performance Record
| Year ended | Year ended | ||
| Total Return | 30 June 2026 | 30 June 2025 | |
| Net asset value per share1 | 76.6% | 4.6% | |
| Share price (mid market)1 | 87.0% | 9.3% | |
| MSCI World Metals and Mining Index (sterling adjusted)2 | 63.5% | (4.5)% | |
| MSCI World Energy Index (sterling adjusted)2 | 34.1% | (7.7)% |
| As at | As at | |
| Capital Values | 30 June 2026 | 30 June 2025 |
| Net asset value per share | 347.19p | 212.56p |
| Share price (mid market) | 343.00p | 199.50p |
| Share price discount to NAV per share1 | 1.2% | 6.1% |
| Net gearing1 | 10.9% | 4.8% |
| Year ended | Year ended | |
| Revenue Earnings and Dividends | 30 June 2026 | 30 June 2025 |
| Earnings per share | 1.02p | 0.00p |
| Dividends per share | 28.30p | 8.03p |
| Dividend yield1 | 8.3% | 4.0% |
| Ongoing charges ratio1 | 1.7% | 2.0% |
1 Alternative Performance Measure (“APM”). A glossary of the terms used, including alternative performance measures, can be found below.
2 Used by the Company as a comparator, not a benchmark. As at 30 June 2026, 48.3% of the portfolio was attributable to the MSCI World Metals and Mining Index and 49.8% of the portfolio to the MSCI World Energy Index. Please refer to the ‘by commodity’ data below for further detail.
| Highs and Lows during the year ended 30 June 2026 | Highest | Lowest |
| Net asset value per share | 457.03p | 210.39p |
| Share price (mid market) | 444.00p | 202.50p |
| Share price premium/(discount) to NAV per share range (positive = premium) | 5.6% | (14.9)% |
| Dividend | ||||
| Dividend History | per share | Ex-dividend date | Record date | Payment date |
| Fourth interim dividend 2026 | 6.94p | 23 July 2026 | 24 July 2026 | 28 August 2026 |
| Third interim dividend 2026 | 8.34p | 30 April 2026 | 1 May 2026 | 29 May 2026 |
| Second interim dividend 2026 | 7.00p | 5 February 2026 | 6 February 2026 | 27 February 2026 |
| First interim dividend 2026 | 6.02p | 30 October 2025 | 31 October 2025 | 28 November 2025 |
| Total for year ended 30 June 2026 | 28.30p | |||
| Fourth interim dividend 2025 | 4.25p | 31 July 2025 | 1 August 2025 | 1 September 2025 |
| Third interim dividend 2025 | 1.26p | 1 May 2025 | 2 May 2025 | 30 May 2025 |
| Second interim dividend 2025 | 1.26p | 30 January 2025 | 31 January 2025 | 28 February 2025 |
| First interim dividend 2025 | 1.26p | 24 October 2024 | 25 October 2024 | 22 November 2024 |
| Total for year ended 30 June 2025 | 8.03p |
Chairman’s Statement
Global macro themes continue to drive interest in natural resources which was reflected in the outperformance of the Company and a total return in NAV per share of 76.6%.
Overview
I am sure shareholders will agree it has been an eventful year, not only for the underlying markets that the Company invests in, but also for the Company itself. I am pleased to say, after much hard work in the background, the transfer of the investment management mandate to Tufton Investment Management was completed after the financial year end, along with a new name to reflect the change.
As part of this, we have been reunited with long standing fund managers, Keith Watson and Robert Crayfourd, who for the past 11 years have demonstrated their abilities with exceptional returns and an ability to foresee changes in underlying themes and make the necessary adjustments ahead of the broader market.
I must emphasise the move to Tufton is not a sea change for the Company. Our investment strategy remains unchanged. We believe Tufton is an organisation that will provide the support, industry knowledge and market intelligence required to create lasting shareholder value.
This access to information, knowledge and experience is of paramount importance when making investment decisions for an active manager in the commodities, energy and shipping space.
With the volatility experienced in commodity markets this year, influenced by factors such as the Iran conflict, ongoing protectionist measures and existing themes such as electrification and AI data centre rollout, the ability to see through the noise and take advantage of opportunities has never been more important.
These global macro themes have amplified focus and interest in commodities by the general public, governments and investors, and this Company, with its active management, we believe is one of the best ways to take advantage of this.
This has been reflected in the Company’s net asset value (“NAV”) per share total return of 76.6% over the 12 month period, outperforming its performance comparators, the MSCI World Metals and Mining Index, which returned 63.5%, and the MSCI World Energy Index, which returned 34.1% (both sterling adjusted).
Company activity over the year
Together with the commentary which follows, I would again like to draw shareholders’ attention to the timeline of events set out on page 8 of the Annual Report which I hope is helpful in aiding an understanding of the various matters which have developed during the Company’s financial year and to date.
The Company’s financial year began with the announcement of the result of the Tender Offer on 1 July 2025. A total of 29,334,059 shares, representing 45.72% of the shares in issue at the time (excluding shares held in treasury) were tendered. In September 2025, the Tender Offer was concluded and resulted in a Tender Price of 208.33 pence per share for those exiting shareholders.
Around the same time, the Company’s shares began to trade at a premium to NAV. As I noted in the Company’s half year report, we believe that the value-enhancing initiatives (including the enhanced dividend yield and reduced management fee) and the strong performance of the portfolio led to improved investor sentiment and the increased demand for the Company’s shares.
Despite the significant reduction in the Company’s net assets on completion of the Tender Offer, the strong performance of the portfolio, particularly in the first half of the year, meant that during the year the Company’s NAV reached the pre-Tender Offer level. However, towards the end of the financial year it dipped back, before recovering in the period to date. The graph on page 7 of the Annual Report illustrates the effect of the Tender Offer and the strong performance of the portfolio on the Company’s NAV over the financial year to 30 June 2026 and beyond.
A General Meeting was held on 2 March 2026, and the Board was pleased that shareholders voted in favour of the two proposed resolutions permitting the Company to issue in aggregate up to 20 per cent. of its issued share capital (excluding shares held in treasury) as at the date of the General Meeting. If the Board had not taken steps to renew the Company’s authority to issue shares, the share issuance authority routinely approved by shareholders at the last annual general meeting (“AGM”) held on 9 December 2025 would have been exhausted in mid-August 2026 and been insufficient to allow the Company to satisfy demand for its shares during the period up to the next AGM in December 2026.
In early March 2026, the Company announced that it had been informed that its named portfolio managers, Keith Watson and Robert Crayfourd, had tendered their resignations to the Company’s investment manager at the time, CQS (UK) LLP, part of the Manulife group (“CQS”). Later in March 2026, the Company announced that it had served six months’ protective notice to CQS. Shortly after, Tufton Investment Management Ltd (“Tufton”) announced that Keith and Robert would be joining as employees as soon as their contractual arrangements allowed them to do so.
Following a period of handover during Keith and Robert’s notice periods, senior Manulife Investment Management Group portfolio managers, Craig Bethune and Diana Racanelli, assumed responsibility for the management of the portfolio in May 2026. There was no change to the Company’s investment process, strategy or operations.
Following the resignations, the Board considered the options available to the Company to move forward in the best interests of shareholders. These options included remaining with CQS or appointing a new investment manager, so the Board conducted an evaluation of possible investment management groups with expertise and a proven track record of performance in the natural resources sector. The Board engaged in a number of discussions with investment management firms (including but not exclusively, CQS and Tufton), received presentations from a shortlist of firms, conducted the necessary due diligence and took into account the learnings and results of its wide-ranging strategic review in 2025. The Board concluded that the appointment of Tufton as investment manager, and the ongoing stewardship of the portfolio by Keith and Robert, was in the best interests of shareholders.
The Company announced on 27 May 2026 that Heads of Terms had been agreed to appoint Tufton as investment manager and alternative investment fund manager with effect from 14 September 2026, with Keith and Robert to resume as the Company’s portfolio managers at that time. The Company shall pay Tufton an annual management fee of 1 per cent. per annum of the NAV of the Company, calculated monthly and payable monthly in arrears. This is in line with the reduced management fee introduced in May 2025.
In June, the Company also received notice from BNP Paribas S.A., London Branch (“BNP”) of its intention to terminate its agreements to provide depositary and custody services. In addition, BNP gave notice that it would cease the provision of a lending facility to the Company. Aided by its advisers, the Board commenced a review of alternative service providers and, following thorough review and negotiation, resolved to appoint Apex Depositary (UK) Limited (“Apex”) as the Company’s depositary and European Depositary Bank SA, Dublin Branch (“EDB”) as the custodian (sub-contracted to Citibank N.A., London Branch) with effect from 14 September 2026, and The Bank of Nova Scotia, London Branch (“Scotiabank”) as lender with effect from 11 September 2026. Further detail on the Company’s borrowing arrangements can be found within Note 12 to the Financial Statements.
Performance and Returns
During the year to 30 June 2026, the Company’s NAV per share total return was 76.6%, outperforming the total return of 63.5% of its performance comparator, the MSCI World Metals and Mining Index (sterling adjusted), to which 48.3% of the Company’s portfolio (as at 30 June 2026) can be attributed. The Company similarly outperformed the total return of 34.1% of the MSCI World Energy Index (sterling adjusted), the sector to which the Company’s portfolio has a greater relative exposure (49.8% as at 30 June 2026).
Performance during the year can largely be attributed to the exposure of the Company’s portfolio to the precious metals rally which was driven by geopolitical uncertainty and a return to safe haven assets.
However, in the second half of the year, Keith and Robert took a conscious decision to re-weight the portfolio in response to the evolving geopolitical situation in the Middle East, which they believed warranted a higher energy risk premium. As a result, profits derived from the portfolio’s precious metals exposure were used to fund this reallocation into energy.
The Company’s share price total return over the year was 87.0%, with the share price increasing from 205.00 pence on 1 July 2025 to 343.00 pence as at 30 June 2026. The Company’s share price during the year peaked at 440.00 pence on 27 February 2026, before falling sharply over the following weeks in response to the initiation of the US and Israeli attacks on Iran and fall in precious metals prices.
As at 23 October 2026, the latest practicable date prior to the publication of this Report, the Company’s share price had reached 376.50 pence.
Management of Premium/Discount
The Board recognises the importance to shareholders of managing the premium or discount of the Company’s share price relative to the NAV per share. Bearing in mind the underlying volatility of the markets in which the Company invests, the Board has determined to use share buybacks with the aim of maintaining a single digit discount to the Company’s NAV per share in normal market conditions.
During the year the Company bought back a total of 30,097,420 shares, however, a significant portion of this relates to the Tender Offer, pursuant to which 20,534,059 shares were bought back for cancellation and 8,800,000 shares were bought back to be held in treasury. This means that only 763,361 shares were bought back in the ordinary course of share price discount management. Those shares were bought back at an average price of 346.63 pence per share and discount to NAV of 9.9%.
With periods of sustained premium driven by demand during the year, the Company was able to sell a total of 2,150,000 shares from treasury at an average price of 379.04 pence per share.
As at 30 June 2026, the Company had 36,210,418 shares in issue (excluding 10,144,032 shares held in treasury) and the discount to NAV was 1.2%. Over the year the discount averaged 3.6%, compared with 8% over the course of the previous financial year.
Gearing
As at the year end, gearing was 10.9%, compared with 4.8% at the beginning of the year. The increase reflects both an additional draw down under the borrowing facility, enabling the portfolio managers to take advantage of market opportunities presented by geopolitical events at the beginning of March 2026, and a reduction in net assets following completion of the Tender Offer.
Dividends
In July 2025, the Company declared a fourth interim dividend (2025) of 4.25 pence per share, the first following the adoption of an enhanced dividend policy to distribute circa. 8 per cent. of the Company’s NAV via a quarterly dividend of 2 per cent. of the preceding quarter-end NAV per share.
Since then, the Company has declared interim dividends (2026) of 6.02 pence per share; 7.00 pence per share; 8.34 pence per share; and 6.94 pence per share, a total of 28.30 pence per share in respect of the year ended 30 June 2026 (2025: 8.03 pence per share) and representing a yield of 8.3% as at the year end (2025: 4.0%). On 15 October 2026, the Company declared its first interim dividend (2027) of 7.88 pence per share to shareholders on the register on 30 October 2026 and which will be payable on 30 November 2026.
Because the dividend is linked to the Company’s NAV rather than being set at a fixed pence per share, the amount paid per share may rise or fall over time. Therefore, if the Company’s NAV declines, shareholders should expect the dividend in pence per share to reduce correspondingly. This mechanism helps ensure that distributions remain aligned with the Company’s NAV and are sustainable over the longer term.
Post reporting period update
Since the year end, in early July 2026, a further 37,180 shares have been bought back into treasury at an average price of 325.09 pence per share and discount to NAV of 8.9%.
Since 3 August 2026, the Company’s shares once again began to trade at a premium to NAV and the Company has sold a further 3,965,000 shares from treasury at an average share price of 391 pence. As at 23 October 2026, the latest practicable date prior to the publication of this Report, the number of shares held in treasury had reduced to 6,216,212, increasing the number of shares with voting rights since the period end to 40,138,238.
In preparation for the change in Investment Manager, on 8 September 2026, the Company held a General Meeting where shareholders approved an amendment to the Company’s Articles of Association (“Articles”) which permitted the directors of the Company to determine the name of the Company. The Board of Directors resolved to change the name of the Company from CQS Natural Resources Growth and Income PLC to City Natural Resources Growth and Income PLC, and this change took effect on 15 September 2026.
On 14 September 2026, Tufton took over from CQS as the Company’s investment manager, and we as a Board very much look forward to continuing to build a productive relationship with the team there.
My fellow directors and I would like to thank Craig Bethune and Diana Racanelli at Manulife Investment Management for their professionalism and responsible stewardship during their interim management of the Company’s portfolio, as well as all involved at CQS throughout the business’ tenure as the Company’s investment manager.
Board of Directors
Carole Cable, having served nine years as a director, will not be seeking re-election and will retire as a Director of the Board at the conclusion of the AGM in December 2026. This is in line with best practice corporate governance. Carole has made an outstanding contribution to the Board during her tenure, bringing a wealth of experience, sound judgement and unwavering commitment to the Company and its shareholders. She has always strived to ensure the best possible communication and engagement with the Company’s shareholders in both routine and challenging circumstances. On behalf of my fellow directors and all shareholders, I would like to express our sincere gratitude to Carole for her dedication to the Company over her tenure and wish her every success for the future.
As previously communicated, I intend to continue to serve as Chairman and will therefore stand for re-election by shareholders at the forthcoming AGM. In 2025, the Nomination Committee assessed the impact of the simultaneous retirement of both Carole and me following our respective nine year tenures. The Committee concluded that a staggered retirement would be in the interests of orderly succession and facilitate continuity and stability of the Board. In light of the developments of recent years, including the changes outlined earlier in this report to the Company’s investment manager and other key service providers, the Board believes that stability and continuity of leadership remain a priority.
As part of its succession planning in 2026, the Nomination Committee has concluded that the Company and its shareholders would be best served by asking me to remain as Chairman for a further year until the AGM to be held in 2028. This will enable the consideration and development of possible candidates on the Board to succeed me as Chair and, in due course, the commencement of a search process to identify and recruit a new non-executive director with the skills the Board has identified that it requires. The Nomination Committee does not consider that my serving on the Board for more than nine years from the date of first appointment impacts my independence as a non-executive director.
Annual General Meeting
The AGM will be held at One Fleet Place, London, EC4M 7RA at 12 noon on 1 December 2026. The business of the AGM is summarised in the Directors’ Report on pages 41 and 42 and the Notice of Meeting beginning on page 87 of the Annual Report.
Auditor
During the year the Audit Committee led a competitive audit tender process, which resulted in the recommendation that PricewaterhouseCoopers LLP be appointed as the Company’s new auditor for the year ending 30 June 2027. Further information concerning the audit tender process can be found within the Report of the Audit Committee on page 54 of the Annual Report, but I would like to take this opportunity to express the Board’s thanks to BDO LLP for its service to the Company as auditor since 2017.
Articles of Association
The Directors are proposing amendments to the Company’s Articles of Association to enhance transparency and strengthen governance. It is the Directors’ belief that these amendments are in the best interests of shareholders as a whole.
Your attention is drawn to Resolution 15 within the Notice of Annual General Meeting beginning on page 87 of the Annual Report, as well as the Appendix – Summary of the Principal Amendments to the Company’s Articles of Association on page 93.
Voting and Q&A
The Board encourages all shareholders to exercise their right to vote at the AGM and, where possible, to do so online in advance. Registering your vote in advance will not restrict you from attending and voting at the meeting in person should you wish to do so. The Board recommends that shareholders vote in favour of all resolutions as each of the Directors intends to do in respect of their own shares.
As well as the formal proceedings, this will be an opportunity to meet the Board and to receive a presentation from our portfolio managers and we hope as many shareholders as possible will attend. Shareholders can submit questions in advance by writing to the Company Secretary, Frostrow Capital LLP (“Frostrow”), at [email protected].
Outlook
While the geopolitical backdrop is likely to remain volatile, the Board shares the portfolio managers’ positive outlook and is confident that, through active, specialist management, the Company is well placed to navigate the uncertainty and take advantage of the opportunities emerging across natural resources markets. The appointment of Tufton as Investment Manager is already bringing complementary expertise and resources, and the Board looks forward to the Company benefiting further from these synergies.
Christopher Casey
Chairman
