International Biotechnology Trust plc (LSE:IBT) reported a share price total return of 73.6% for the year ended 31 August 2026, outperforming the NASDAQ Biotechnology Index, which returned 52.3% over the same period.
The biotechnology-focused investment trust achieved a net asset value (NAV) total return of 64.7%, marking its fifth consecutive year of outperformance against the reference index.
Net assets increased to £374.6 million from £249.4 million, while NAV per share rose to 1,183.33p from 739.48p.
Takeover Activity Drives Portfolio Performance
Mergers and acquisitions were a major contributor to the trust’s performance during the financial year, with 13 portfolio companies acquired, compared with five in the previous year.
The acquired companies represented approximately 27% of the trust’s NAV, reflecting substantial corporate activity across its biotechnology investments.
Notable transactions included Vertex Pharmaceuticals’ $10 billion acquisition of Crinetics Pharmaceuticals, Biogen’s $5.6 billion purchase of Apellis Pharmaceuticals and Merck & Co’s $6.7 billion acquisition of Terns Pharmaceuticals.
More than 40 companies held within the trust’s portfolio have been acquired since 2020.
Discount to NAV Narrows to 4.1%
International Biotechnology Trust’s discount to NAV narrowed from 8.9% to 4.1% during the year, contributing to the stronger performance of its share price relative to the underlying portfolio.
The company repurchased 2,074,657 shares into treasury during the reporting period.
The trust also reported lower operating costs, with ongoing charges declining to 1.0% from 1.3%.
The management fee on its quoted investment portfolio was reduced to 0.65% from 0.70%, effective from 1 September 2025.
Annual Dividends Reach 31.31p Per Share
The trust paid total dividends of 31.31p per share for the financial year, representing a yield of 2.8% at 31 August 2026.
Its dividend policy provides for annual distributions equivalent to 4% of NAV, paid in two semi-annual instalments.
Shareholders will be asked to approve the continuation of this policy at the annual general meeting in December 2026.
Following the 50.2% increase in the company’s NAV during the year, International Biotechnology Trust expects total dividends payable for the financial year ending 31 August 2027 to increase by the same percentage, in accordance with its distribution policy.
Outlook
International Biotechnology Trust’s annual results reflect strong investment performance, increased biotechnology takeover activity and a reduction in its share price discount to NAV.
The trust also enters the new financial year with lower ongoing charges and expectations of higher dividend distributions, subject to the continuation of its existing policy.
Future performance will remain dependent on developments across the biotechnology sector, portfolio valuations and further corporate acquisition activity.
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