Odyssean Investment Trust Reports Strong 25.0% NAV Growth Amid Volatile Markets

Odyssean Investment Trust annual results: 25.0% NAV growth beats the UK smaller companies market

Odyssean Investment Trust has put in a very strong set of annual results on the board. For the year to 31 March 2026, net asset value – or NAV, the value of the portfolio after liabilities – rose by 25.0% per share to 172.4p. That comfortably beat the 11.0% return from its comparator, the NSCI ex IT plus AIM Total Return Index.

For retail investors, the simple version is this: the trust had a cracking year in portfolio terms, even though markets were choppy and smaller companies got hit harder than large caps late in the period. The share price also kept pace, rising 28.3% to 172.5p, which left the shares trading almost exactly in line with NAV.

Key figure	31 March 2026	31 March 2025	Change
Shareholders’ funds	£239.9 million	£183.5 million	30.7%
NAV per share	172.4p	137.9p	25.0%
Share price	172.5p	134.5p	28.3%
Premium/(discount) to NAV	0.1%	(2.5)%	Improved
Ongoing charges	1.49%	1.47%	Slightly higher

What drove Odyssean Investment Trust performance in 2026

The biggest winners were XP Power, Dialight, and Gooch & Housego. Management says those three holdings alone contributed around 20 percentage points of the total performance, which tells you just how much stock picking mattered here.

XP Power rose by 62%, helped by easing tariff fears and signs that trading had bottomed out. Dialight was even better, up around 120%, as operational improvements started to show through. Gooch & Housego returned 74% as demand in semiconductor, industrial and healthcare markets began to recover.

This matters because Odyssean runs a concentrated portfolio of just 17 companies. That can be brilliant when the manager gets it right, as happened this year. It also means performance can swing around more than a broader, more diversified trust.

The trust’s top 10 holdings made up 86.8% of net assets at the year end, with XP Power alone at 14.6% of NAV and NCC Group at 10.6%. That is not a portfolio built to hug an index. It is built to make bold bets on smaller companies the manager thinks are undervalued and capable of improving.

Concentrated UK small-cap investing worked – but it is not low risk

The manager’s style is very clear. Odyssean focuses on smaller quoted companies, especially in industrials, TMT – technology, media and telecoms – healthcare and business services. It also prefers companies with overseas revenues, which helps reduce reliance on a weak UK economy.

That positioning paid off. The chairman says the portfolio generates around 80% of revenues from outside the UK, versus around 40% for the average UK quoted smaller company. In plain English, this trust is not really a bet on the British high street. It is a bet on overlooked smaller businesses with international exposure and company-specific recovery stories.

The downside is obvious too. If a few big holdings misfire, returns can get ugly quickly. The main drags this year were NCC, Auction Technology Group and Flowtech, which together knocked 4.2 percentage points off performance. Even in a good year, that shows the bumps do not disappear.

Share issuance, discount control and why the near-zero discount matters

One quietly encouraging point is the rating. Investment trusts can trade above or below NAV, known as a premium or discount. Odyssean ended the year on a tiny 0.1% premium, versus a 2.5% discount a year earlier.

That is a good sign because it suggests investors were willing to pay roughly full value for the portfolio. Better still, the company issued 6,108,579 new shares during the year at a premium to NAV, raising £10.2 million net. That is shareholder-friendly because issuing above NAV should not dilute existing holders.

After the year end, it issued another 1,178,000 ordinary shares for net proceeds of £2.3 million. The trust’s scale is growing, and that can help liquidity – meaning it is easier for investors to buy and sell shares without moving the price too much.

No dividend, slightly higher costs, and a structural change worth watching

If you own investment trusts for income, this is not one for you. The board is blunt: returns are expected to come mainly from capital growth, not dividends, and no dividend will be proposed for the year ended 31 March 2026.

Revenue return per share was negative at 0.6p, compared with negative 0.4p last year. That is not a disaster for a growth-focused trust, but it does reinforce the point that income is not the attraction here.

Costs were steady enough. Ongoing charges ticked up slightly to 1.49% from 1.47%. Portfolio management fees were £2.166 million, and no performance fee was accrued.

There was also an important structural change after the year end. Odyssean Capital LLP became the trust’s alternative investment fund manager, or AIFM. For most private investors, that is plumbing rather than fireworks, but it could matter because the board is also exploring short-term gearing of up to 10% of NAV. Gearing means borrowing to invest. Done carefully, it can improve flexibility, but it also adds risk. No borrowing policy change has been approved yet.

Odyssean Investment Trust outlook: strong momentum, but geopolitics and UK weakness still hang over markets

The trust’s commentary is confident, and not without reason. Since the year end to 11 June 2026, NAV per share increased a further 21.6% to 209.7p. The share price rose 16.2% to 200.5p over the same period.

That tells you the good momentum did not stop on 31 March. It also suggests the portfolio kept benefiting from improving industrial and semiconductor demand, plus some corporate activity such as the bid for Blackline Safety.

Still, there are real risks here. Management points to volatility linked to the Iran conflict, higher inflation risk, uncertain UK politics and weaker domestic growth. The board also flags that smaller companies tend to get sold off harder in risk-off markets. That is exactly what happened in March.

So this is not a sleep-easy defensive trust. It is a higher-conviction small-cap vehicle that can do very well when its investment cases start working, but it will almost certainly remain more volatile than a plain vanilla UK equity income fund.

My view on the Odyssean Investment Trust annual report

I think this is a strong result and a pretty convincing one. Beating the broader UK smaller companies market by that margin is not luck alone, especially when it comes from a clear strategy and visible stock-specific recoveries.

The positives are the 25.0% NAV growth, a share price that tracked NAV, sensible issuance at a premium, and good post-year-end momentum. The negatives are concentration risk, no dividend, slightly higher costs, and exposure to the sort of market mood swings that can batter smaller companies.

Overall, this reads like a trust that knows exactly what it is trying to do and had a very good year doing it. If you want diversified, low-drama investing, this is probably not your bag. If you like high-conviction UK smaller company investing with a strong bias to turnaround and self-help stories, Odyssean has given shareholders plenty to like in this update.