Summarised Financial Statements 2013 Summarised Annual Report and Financial Statements 2013 Contents Chairman’s Statement 02 Summary Trustee’s Report 04 Vision and objects, mission, focus areas 04 and challenges Financial Review 06 Extracts from the Review of Investment Activities 08 Consolidated Statement of Financial Activities 10 Consolidated Balance Sheet 11 Consolidated Cash Flow Statement 12 Grants Awarded 13 Reference and Administrative Details 15 Chairman’s Statement The best research for better health The Wellcome Trust is at its best mouth disease. The team included when catalysing interactions between academic scientists from the researchers and other people, be they Universities of Oxford and Reading researchers in different fields, people and researchers at the Pirbright in business or politics, or members of Institute, which is funded by the the public. We believe that science Biotechnology and Biological Sciences should be at the heart of life, but for it Research Council. Part of to play its part in society people must the work was done at Diamond Light feel able to engage and partner with Source, the UK’s national synchrotron scientists to discover and create new facility, which is funded by the opportunities. The Trust brings Science and Technology Facilities people together, enabling Council and the Wellcome Trust. collaboration, excellent research and, Diamond generates high-energy ultimately, better health. We beams of electrons to investigate the Summary of Chairman’s committed £726 million in grant physical properties of molecules and Statement funding and direct charitable materials, and underpins much of the activities this year, mostly in grants to UK’s strength in structural biology. • We committed £726 million in grant scientists working in medical funding and direct charitable research, and most of them in the UK. Diamond’s role in developing the foot activities this year, mostly in grants and mouth disease vaccine was to to scientists working in medical In last year’s Annual Report, I show the physical effects of research, and most of them in the UK. mentioned that the first tenants had modifications to the vaccine’s moved in at Stevenage Bioscience structure. A similar approach could be • The UK’s scientific infrastructure, to Catalyst, a biotechnology ‘incubator’ used to make better human vaccines which Stevenage Bioscience Catalyst where life science companies can as well. The foot and mouth disease is an innovative addition, is an explore new ways of working and virus is related to the virus that excellent foundation for achieving bring convergent technologies causes polio, which remains a threat better health. together. Reflecting its vision of despite the success of a long- openness and collaboration across established global vaccination • We launched a new scheme this year, companies and sectors, Stevenage programme, as we have seen by the Sustaining Health, to encourage and Bioscience Catalyst is a joint venture re-emergence of the disease in Syria support research in areas such as the between the Wellcome Trust, the UK this year. A new vaccine could help to health impacts of climate change, government and GlaxoSmithKline. redouble efforts towards finally connections between ecology and There are now 26 tenants on the site, eradicating polio. public health, global nutrition and more than 70 per cent of capacity. It behaviour change. is hugely exciting that there is such Investments demand from British businesses to Long-term investors are able both to • Over 10 and 20 years, returns have use the site and I am sure some be counter-cyclical and patient. averaged 10% a year, enabling impressive outcomes will follow. Having significantly increased our us to increase progressively our exposure to public and private equity commitments to medical research. The UK’s scientific infrastructure, to holdings in the period between 2008 which Stevenage Bioscience Catalyst and 2011 when many investors had is an innovative addition, is an become risk-averse, we have reaped excellent foundation for achieving the rewards in the last two years as better health. For example, a new they have again embraced risk assets. vaccine was created this year to In 2012/13, we enjoyed returns of over protect cattle and other livestock £2.6 billion (18%) as our public against the virus that causes foot and equities, private equity holdings, 2 | Summarised Annual Report and Financial Statements 2013 venture capital funds, hedge funds evidence base is as robust as possible. Director for six months, as well as the and residential property interests all We launched a new scheme this year, entire staff: it is the people in the recorded gains of 15-20%. Returns in Sustaining Health, to encourage and Trust and those we work with, the five years since September 2008 support research in areas such as the including application reviewers and have exceeded £7 billion (57%). Over health impacts of climate change, our funding committee members, 10 and 20 years, returns have averaged connections between ecology and who make our vision into a real 10% a year, enabling us to increase public health, global nutrition and success. From our Investments progressively our commitments to behaviour change. These are relatively Committee, I would particularly like medical research. new fields of research and bridge to acknowledge the contribution of previously unconnected disciplines, Stewart Newton, chairman of Veritas Danny Truell and his investment so once again the Trust is looking Investment Management, who stood team continue to evolve our to catalyse new initiatives, approaches down this year. portfolio in order to ensure that we and collaborations that could have greater control of our destiny help map out routes to a sustainable Great thanks and recognition also to and that our long-term returns are future. Professor Peter Rigby for the breadth driven more by the evolution of of his scientific support and businesses than by short-term A global outlook comes naturally to constructive challenge as Deputy market fluctuations. our Director, Dr Jeremy Farrar, who Chairman of the Trust for the last started the role in October 2013. three years. Professor Kay Davies has For example, our directly managed Jeremy trained as a medical doctor now taken up the position of Deputy Mega Cap Basket of 31 holdings in and clinical researcher in the UK, and Chair: Kay has been on the Board of large companies, valued at £3.4 has spent the last 20 years leading the Governors for the past six years and I billion, is the cornerstone of our Trust’s Major Overseas Programme in am looking forward to working with equity holdings. Initiated in late 2008, Vietnam. His experience of building her in this role as well. it has returned 55% on cost: last year, international partnerships and we neither added new holdings nor respect, especially in South-East Asia, Another of our Governors, Professor sold any shares in existing holdings. will be of great value, as will his global Anne Johnson, was made a Dame in vision and experience. With a new the Queen’s Birthday Honours – Over 80% of our portfolio is now Director, the Trust continues to congratulations to Dame Anne, and concentrated in 42 directly-held evolve: Jeremy will use his distinctive also to Professor Steve O’Rahilly, public or private assets and in 51 perspective to build on the work and co-Director of the Medical Research external partnerships, each with wisdom of our former Directors, as Council-Wellcome Trust Institute of a value exceeding $100 million: of did his immediate predecessor, Sir Metabolic Science, and Professor these partnerships, half are at least Mark Walport. Mike Stratton, Director of the a decade old. Our cash flows have Wellcome Trust Sanger Institute, who become increasingly positive and I extend my heartfelt thanks to Mark both received knighthoods this year. reinvestment risk has risen: hence, for ten years of distinguished we shall need to be disciplined in leadership of the Trust, which came focusing new investments on to an end in March 2013 when he left assets, which will genuinely add to become the Chief Scientific Advisor long-term value irrespective of to the UK Government. As Director, geography or industry. Mark enhanced the professionalism of the Trust and bestowed a clear Sir William Castell A world of knowledge sense of purpose underpinned by a Chairman of the Wellcome Trust The big health challenges of the well-articulated strategy. 17 December 2013 future will be global: every country Achievements in progressing will be affected by the changing scientific understanding were climate, increasing population and complemented by a programme of more people living in cities. How we scholarship to support and develop respond to the pressure these factors researchers and scientific leaders for put on our health will depend on the future. national and international policies which, in turn, draw on whatever I would also like to thank Dr Ted scientific evidence is available. At the Bianco, our Director of Technology Trust, we want to ensure that the Transfer, for standing in as Acting Summarised Annual Report and Financial Statements 2013 | 3 Summary Trustee’s Report Vision and objects, mission, focus areas and challenges Our vision and objects We are dedicated to achieving extraordinary improvements in human and animal health The objects of the Wellcome Trust (the “Trust”), as set out in its Constitution, are as follows: To protect, preserve and advance all or any aspects To advance and promote knowledge and education of the health and welfare of humankind and to by engaging in, encouraging and supporting: advance and promote knowledge and education by engaging in, encouraging and supporting: • research into the history of any of the biosciences; and • research into any of the biosciences; and • the study and understanding of any of • the discovery, invention, improvement, the biosciences or the history of any development and application of treatments, of the biosciences.