Secured Income Fund : Factsheet 31 Dec 2020

Secured Income Fund Plc

Factsheet│31 December 2020

Key Benefits

1. Diversified exposure to SME borrowers across key markets in the UK, Europe and USA.
2. Lending against business critical assets providing downside protection.

Investment Objective

The Secured Income Fund Plc is managed with the intention of realising all remaining assets in the Portfolio in a prudent manner consistent with the principles of good investment management and with a view to returning cash to Shareholders in an orderly manner.

The Company will pursue its investment objective by effecting an orderly realisation of its assets in a manner that seeks to achieve a balance between maximising the value received from those assets and making timely returns of capital to Shareholders. This process might include sales of individual assets, mainly structured as loans, or running off the Portfolio in accordance with the existing terms of the assets, or a combination of both.

Fund Information

Share Price Performance

Portfolio Exposure

Key facts

Since inception

100%Current and projected, by type

Forecast

150

Market Capitalisation

£35.0m

80%

Share Price

66.50p

100

60%

NAV

£41.3m

50

40%

20%

NAV per share

78.26p

0

0%

Premium / (Discount)

-15.0%

9/2015

9/2016

9/2017

9/2018

9/2019

9/2020

3/2017

3/2018

3/2019

3/2020

3/2021

Share Price

NAV

Cash

Gearing

None

Direct loans (KKV originated)

Platforms

Management

0.75%

Performance¹

Fees2		Total return, cum income, %
Ongoing charges	2.0%
To 31/12/2020			SI	3y		1y		6m
Ticker	SSIF:LN	Share price		0.39	-1.28		-8.88		-2.85
NAV		3.54	1.40		-3.37		-0.64
ISIN	GB00BYMK5S87	1 Annualised for periods longer than one year.
		12M discrete	31/12/2016-		31/12/2017 -		31/12/2018 -	31/12/2019 -
		31/12/2017		31/12/2018		31/12/2019		31/12/2020
		Share price	7.42		5.80		-0.20		-8.88
		NAV	4.93	6.02	1.78		-3.37

2 As per the resolution detailed in the Circular issued on 20th August 2020, the management fee reduced to 0.75% for 12 months from 18th September 2020.

Fund Portfolio3			Portfolio exposure (%)	Maturity breakdown (%)
Top 10 Holdings (%)			Direct Loans	79.7	0-6 months	11.4	1
Direct Loan	24.16%		(KKV originated)
		6-18 months	28.9	2
Direct Loan	11.15%		Co-invested and
Direct Loan	10.61%	13.8	18-36 months	39.7	3
solely owned debt
Co-investment	8.83%			>36 months	20.0	4
Direct Loan	6.78%	Cash	6.0
Direct Loan	6.33%
		Weighted average maturity	2.0 years
Direct Loan	5.33%	Peer-to-peer /	0.5
Direct Loan	4.82%
Crowdfunded
Direct Loan	4.76%			Currency breakdown
Co-investment	3.85%	Geographical breakdown (%)
Total	86.62%
Total number of holdings	19		UK	72.4	GBP	£29,952,000	72.4%
			USD	$9,330,000	16.5%
Average loan size	£2.04m	Europe	12.1
EUR	€5,145,000	11.1%
Weighted average yield	9.90%
	US	11.7
			Offshore Britain	3.8	No currency hedging used4

1. Portfolio exposures are calculated as the present balance outstanding plus investment receivables less any impairment/ expected credit loss provision.
2. Please note currency hedging was removed during September 2020

Dawn Kendall

CIO & Lead Fund Manager Dawn has 34 years' experience in financial services, including 25 years' experience managing fixed income portfolios at distinguished financial institutions, including in her role as Partner and Portfolio Manager at TwentyFour Asset Management, as CIO for IAM, a fund of hedge funds, and Portfolio Manager for The Codelouf Trust, a family office. Additionally, Dawn has held senior investment and management positions at Newton, Axa (Architas) and Investec Wealth. Dawn has a degree in European and English Law and an MBA.

December Investment Highlights

As we observed earlier in the year, direct lending strategies targeting Europe are poised to benefit from a windfall of new origination as high street banks start to tighten their lending criteria. 2020 proved to be a challenge as liquidity boosts from government supported loan schemes made the cost of this type of debt prohibitive. However we have observed from our own wholesale exposure that new business has been stable even through this latest lockdown period and our wholesale lenders expect a further increase as they step into the space vacated by the banks. For SIF, this has meant that amortisation for our wholesale borrowers has commenced without difficulty and we are confident that we will be able to return capital as scheduled in relation to these loans.

In addition, we have received a steady flow of cash from our film financing transactions and a payment from our largest venture debt exposure as another facility to a financial services business was successfully sold. The largest debt obligation of the venture debt

exposure has been taken onto the balance sheet

having made arrangements for the management of this business to remain with the manager, allowing the platform to commence a faster wind-down.

Platform debt remains steady with two loans maturing leaving just seven loans with this counterparty. One of these is a property finance loan based in Gibraltar and with the successful close of a trade deal for the UK, we expect the final requirements for repayment to be achieved soon.

We have returned 8.50 pence to shareholders via dividend distribution since September 2020 and we continue to accumulate cash enabling us to continue with this policy.

Please note, we no longer hedge our foreign exchange exposures and provide details of the USD and EUR allocations in the data provided in the factsheet to allow shareholders to consider their own hedging, if they so required.

Disclaimer:

Secured Income Fund plc (the "Company") is an investment company, incorporated in England with registered number 09682883, whose shares have been admitted to trading on the Specialist Fund Segment of the Main Market of London Stock Exchange plc. The Company is an alternative investment fund for the purposes of the Alternative Investment Fund Managers Directive. The Company has appointed Kvika Securities Limited ("KSL") as its alternative investment fund manager, and KKV Investment Management Limited ("KKV") has been appointed as the Company's portfolio manager. This Factsheet is provided for information purposes only and should not be relied on by any person in making an investment decision. The value of investments and any income from them may go down as well as up and are not guaranteed. Investors may get back less than the original amount invested. Past performance is not a reliable indicator of future performance and investors may not get back the original amount invested. There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. Whilst it is the intention to achieve the investment objectives of the Company, there can be no assurance that the objectives will be met. Any forecast, projection or target is indicative only and not guaranteed in any way. All reasonable endeavours have been used to ensure the accuracy of information contained in this Factsheet, but there is no guarantee as to the completeness or accuracy of such content. This material should not be considered as advice or an investment recommendation. No warranty of accuracy is given. For an overview of the terms of investment, risks and costs and charges, please refer to the Annual Report and Key Information Document from which the risk indicator is taken. If you are in any doubt as to the suitability of the Company for your investment needs, please seek investment advice. This Factsheet is a financial promotion and is not intended to be investment advice. It is issued and approved solely for the purpose of section 21(2)(b) of the Financial Services and Markets Act 2000 (as amended) by KSL which is authorised and regulated by the Financial Conduct Authority. It is entered on the Financial Conduct Authority's register under registered number 538806. KSL is a private limited company incorporated in England (registered no. 06801718) with its registered office at 25 Upper Brook Street, London, England, W1K 7QD. KKV is a private limited company incorporated in England (registered no. 12475228) with its registered office at 25 Upper Brook Street, London, England, W1K 7QD. Copyright © (2021) Kvika Securities Ltd. All rights reserved.

KKV Investment Managmeent

25 Upper Brook Street

Mayfair

London W1K 7QD

United Kingdom

For more information, please contact:

[e-mail]

Company Broker | FinnCap Ltd | One Bartholomew Close, London, EC1A 7BL William Marle | [e-mail] | [phone]

Mark Whitfeld | [e-mail] | [phone]

Secured Income Fund plc

Closed-ended Investment Company | Listing: London Stock Exchange Main Market

Specialist Segment | Domicile: UK