Mercia Asset Management PLC

("Mercia", the "Company" or the "Group")

Trading Update

Mercia Asset Management PLC (AIM: MERC), the proactive, regionally focused specialist asset manager with c.£872million of assets under management, announces a trading update for the year to 31 March 2021.

The Board is pleased to announce that trading has continued to be robust since the Group's interim results were announced in early December 2020. A positive combination of revenue growth in the second half of the financial year coupled with lower than anticipated staff related expenditure, in part due to the Government's most recent stay at home lockdown restrictions, now means that the Group's full year adjusted operating profit* is expected to be materially ahead of current consensus forecasts.

This elevated second half trading performance coupled with the recently announced profitable sale of Oxford Genetics Limited ("Oxgene") is, subject to audit, likely to result in the Group's full year consolidated profit and total comprehensive income exceeding £23million. Unrestricted cash at 31 March 2021 is now forecast to be c.£49million.

Dr Mark Payton, CEO of Mercia Asset Management PLC, said: "It is very pleasing to be providing this trading update immediately following the sale of Oxgene, and after the Group's strong interim results announced in December 2020. Our specialist asset management business is continuing to perform well, underpinned by our increasing scale, leading market position and recurring revenue model.

Less than two years ago we set out a clear strategy aimed at making Mercia a sustainably profitable, cash generative, specialist asset manager. We have now achieved this, establishing the foundation for future profitable growth. The outlook for Mercia beyond the current financial year is positive and we look forward to reporting our full year results to 31 March 2021 in early July."

* Adjusted operating profit is defined as operating profit before realised gains on disposal of investments, fair value movements in investments, share-based payments charge, depreciation and amortisation of intangible assets.

 This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018.  Upon publication of this announcement, this inside information is now considered to be in the public domain.

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About Mercia Asset Management PLC

Mercia is a proactive, specialist asset manager focused on supporting regional SMEs to achieve their growth aspirations. Mercia provides capital across its four asset classes of balance sheet, venture, private equity and debt capital: the Group's 'Complete Connected Capital'. The Group initially nurtures businesses via its third-party funds under management, then over time Mercia can provide further funding to the most promising companies, by deploying direct investment follow-on capital from its own balance sheet.

The Group has a strong UK footprint through its regional offices, 19 university partnerships and extensive personal networks, providing it with access to high-quality deal flow. Mercia currently has c.£872million of assets under management and, since its IPO in December 2014, has invested c.£106million gross into its direct investment portfolio.

Mercia Asset Management PLC is quoted on AIM with the EPIC "MERC".