Hipgnosis Songs Fund Limited

Quarterly Report • Sep 30, 2019

Hipgnosis Songs Fund Limited

Interim Report and Condensed Consolidated Financial Statements For the six months ended 30 September 2019

Contents

Overview
Corporate Summary	02
Chairman's Statement	05
Financial and Operational Highlights	08
Investment Adviser's Report	12
Investment Objective and Policy	19
Governance
Directors' Responsibility Statement	21
Financial Statements
Condensed Consolidated Statement
of Comprehensive Income	22
Condensed Consolidated Statement
of Financial Position	23
Condensed Consolidated Statement
of Changes In Equity	24
Condensed Consolidated Statement
of Cash Flows	25
Notes to the Condensed Consolidated
Financial Statements	26
OtherInformation
Glossary of Capitalised DeXned Terms	37
Directors and General Information	42

Capitalisedterms aredeXnedintheGlossaryofDeXnedTermsonpages37to41unless separatelydeXned.

Corporate Summary

Investment Objective

The Company's investment objective is to provide Shareholders with an attractive and growing level of income, together with the potential for capital growth, from investment in a portfolio of Songs and their associated musical intellectual property rights. The Portfolio has been created by investing in Catalogues of proven established Songs from well-known songwriters and recording artists. However, each Song is considered to be a separate asset.

Structure

The Company is an investment company limited by shares, registered and incorporated in Guernsey undertheCompanies Lawon 8 June 2018.TheCompany is registeredwith the Guernsey Financial Services Commission under the Registered Collective Investment Scheme Rules 2015, and the Protection of Investors (Bailiwick of Guernsey) Law, 1987, as amended. The Company is not authorised or regulated by the Financial Conduct Authority.

TheCompany makes and manages its investments directly orindirectly through a number ofwholly owned subsidiary companies incorporated in England & Wales, together referred to as the Group.

Investment Process

TheCompany's InvestmentAdviser,The Family (Music) Limited,was founded byMerckMercuriadis. Merck is the manager and/orformer manager of globally successfulrecording artists such as Elton John, Guns N' Roses, Morrissey, Iron Maiden, Nile Rodgers and Beyoncé, and hit songwriters such as Diane Warren, Justin Tranter and The-Dream. Merck Mercuriadis is the former CEO of The Sanctuary Group plc.

The Family (Music) Limited has been appointed by the Board to source Songs and provide recommendations to the Board on acquisition and disposal strategies. The Investment Adviser is also responsible for managing and monitoring royalty and/orfee income due to theCompany from its copyrights and collection agents, and developing strategies to maximise the earnings potential of the Songs in the portfolio through improved placement and coverage of Songs.

The Investment Adviser continues to assemble an Advisory Board of highly successful music industry experts which include award winning members of the artist, songwriter, publishing, legal, Xnancial, recorded music and music management communities, all with in-depth knowledge of music publishing and access to a signiXcant network of relationships in the music industry.

The Board has formed a Portfolio Committee which considers the recommendations of the Investment Adviser before granting its approval to purchase the Catalogues of Songs, as well as an Asset Management Committee which considers the ongoing management and revenue maximisation of the Catalogues of Songs. These committees are chaired by Paul Burger and Andrew Sutch, respectively.

Corporate Summary continued

Principal Risks and Uncertainties

TheCompany's principalrisks are related to market conditions in the music business in general, but also the particular circumstances oftheCatalogues of Songs inwhich itis invested. The Board and the Investment Adviser seek to mitigate these risks through active asset management initiatives and carrying out due diligence work on potential targets before entering into any investments.

The principal risks and uncertainties of the Company will be continuously monitored by the Board, with input from the Investment Adviser and its Advisory Board.

The risks set out below are taken from the Company's latest Prospectus published on 27 September 2019. The principal risks facing the Company are concentration risk from investing only in the global music copyright sector and inherent risks associated with the fast-changing landscape within the music industry.

Key risks relating to the Company:

• The Company has a limited operating history, and investors have a limited basis on which to evaluate the Company's ability to achieve its investment objective; and
• The Company's target annual dividend yield and target total NAV return are based on estimates and assumptions that are inherently subject to signiXcant business and economic uncertainties and contingencies. The actual dividend yield and total NAV return may be materially diWerent to those targeted and payments of dividends from capital reduces the amount of cash that can be deployed for investment purposes.

Key risks relating to the music industry:

• For a wide number of reasons, a Song may not prove to be as popular, or as commercially successful, as had been forecast atthe time of acquisition and there can be no guarantee that the historic performance of a Song will continue in the future;
• DSPs may alter their current prices for consumers which could impact on the proXtability of the Songs licensed to such DSPs; and
• The streaming business model is yetto be proven in the long term and the streaming market is vulnerable to online domination by oneDSP,which may aWectthe pricing structures used by such DSPs.

Key risks relating to the Company's Investment Adviser:

• The Company and the other fund entities are reliant on the expertise of the Investment Adviser and its key personnel (including Merck Mercuriadis)to source and advise on potential Catalogues and to implement the Company's investment strategy so as to meet the target dividend yield and target total NAV return.

Corporate Summary continued

Principal Risks and Uncertainties (continued)

Key risks relating to the Company's investment policy:

• Catalogues and other Songs are diZcult to value and Song valuations are subject to Yuctuations. The market standard valuation method is to value Songs and Catalogues by reference to historic revenues generated. There can therefore be no guarantee that the valuation will be justiXed by reference to future revenues or that the Company will be able to realise the acquisition value upon a future sale;
• TheCompany's investments may be subjectto foreign currency Yuctuations between Sterling and any other currency in which acquisitions of Catalogues are denominated or income is earned by the Company, which may have an adverse eWect on the performance of the Company; and
• TheCompany may utilise borrowings forworking capital, interestrate hedging purposes, and for short-term bridging purposes to Xnance the acquisition of Songs. While such leverage provides Yexibility and presents opportunities forincreasing totalNAVreturn, it can also have the opposite eWect of increasing losses.

Key risks relating to regulation and taxation:

• If payments to the Group are subjecttowithholding tax in any tax jurisdiction,theCompany's Xnancial condition and prospects could be materially and adversely aWected; and
• Changes in laworregulations underpinning theCompany's regulatory environment, or a failure to complywith any laws orregulations, may adversely aWectthe businesses, investments and performance of the Company and the Investment Adviser.

AIC

The Company is a member of the Association of Investment Companies and complies with the AIC Code. The Company's page can be found by clicking on this link.

Website

TheCompany'swebsite,which can be found atwww.hipgnosissongs.com, includes information on the Company, such as its prospectus, past reports and accounts, policies, media coverage and regulatory news announcements.

Chairman's Statement

Introduction

This is the Company's second interim report since its launch and it covers the six months ended 30 September 2019. The report summarises that signiXcant progress has been made in building a portfolio of proven Songswhich are generating strong investmentreturns and in raising newequity capital to fund further investments with a view to delivering increased value for our shareholders.

During the period,theCompany has invested a further £199.5 million across 15Catalogues utilising the remaining proceeds from the IPO in 2018 as well as proceeds from the subsequent placing raising £141.5 million in April 2019. Having deployed or committed our existing capital resources the Company raised a further £51.1 million of equity capital in August 2019.

At the end of September the portfolio consisted of 27 Catalogues with an aggregate acquisition value of £319.4 million. Since the period end,theCompany has acquired a further 15Catalogues for an aggregate of £186.1 million increasing our current portfolio to 42Catalogues comprising 11,225 Songs.

In September, the Company transferred its entire issued share capital to the Premium Listing Segment ofthe OZcial List ofthe FCA and to the London Stock Exchange's Premium Segment of the Main Market ahead of a successfulCShare issue in Octoberwhich raised £231.0 million,taking the total equity capital raised since IPO to over £625 million.

Investments

During the period to 30 September 2019, the Company acquired 15 Catalogues comprising 4,379 Songs for a total consideration of £199.5 million.The acquisitions have signiXcantly diversiXed the portfoliowhich nowincludes Songs performed by hundreds of artists across multiple genres.All of the acquisitions were sourced by our Investment Adviser, The Family (Music) Limited, who togetherwith itsAdvisory Board provide access to some ofthe most successful artists, songwriters and producers globally.

Performance

I am pleased to report an increase in net income from the portfolio to £22.6 million for the period (Xnancial period ended 31 March 2019: £7.2 million), which was ahead of management's expectations for the period. Adjusted(1) operating proXt for the period before tax increased to £14.1 million (Xnancial period ended 31March 2019: £3.0 million)with an increased ongoing charges Xgure of 1.76% (Xnancial period ended 31March 2019: 1.70%) as a result ofincreased due diligence and other variable acquisitions costs as theCompany has acquired a greater number ofCatalogues during the period and built a signiXcant pipeline of Catalogues for acquisition in the second half of our Xnancial year.

Adjusted Earnings Per Share (EPS)(1) grew to 3.55p (Xnancial period ended 31 March 2019: 1.17p) and basic EPS grew to 3.19p (Xnancial period ended 31 March 2019: 1.17p).

Chairman's Statement continued

Performance (continued)

The Board considers that the most relevant NAV for Shareholders is the 'Operative NAV' which reYects the fair value of the Company's Catalogues as valued by an Independent Valuer and is calculated semi-annually. The Operative NAV as at 30 September 2019 increased by 5.03% to 108.46p per Ordinary Share, from 103.27p as at 31 March 2019. Therefore, together with the dividends of 2.5p per Ordinary Share paid,the Company has delivered a total NAV return of 7.45% during the period.

At 30 September 2019 the Company had no C Shares in issue; therefore the Xrst NAV for the C Shares to be published, unless already converted, will be as at 31 March 2020.

Dividend

In the Xrst half of the current Xnancial year the Company has paid dividends of 2.5p per Ordinary Share. TheCompany's third interim dividend forthe period from 1 January 2019 to 31 March 2019 of 1.25p perOrdinary Sharewas paid on 31May 2019.The Xrstinterim dividend forthe period from 1 April 2019 to 30 June 2019 of 1.25p per Ordinary Share was paid on 30 August 2019.

Since the period end, on 24October 2019 theCompany declared its second interim dividend forthe period from 1 July 2019 to 30 September 2019 of 1.25p Ordinary Share and which was paid to shareholders on 29 November 2019.

As previously reported, the Company is targeting a total dividend of 5.0p(2) per Ordinary Share for the current Xnancial year ending 31 March 2020.

Working Capital Facility

In its Xrst Annual Report, the Company stated that the Directors considered it a priority that the Company's level of gearing should be established at appropriate levels with suZcient Yexibility to enable the Board to adapt at short notice to take advantage of changes in market conditions.

In August 2019, the Company negotiated a £65 million Revolving Credit Facility with JP Morgan Chase Bank, N.A., with an option to increase this to £100 million, subject to certain conditions and commitments from willing lenders. The facility, which is available for three years, will provide Hipgnosiswith increased Yexibility to fund investments andworking capital going forward.At period end £13.75 million was drawn on this facility which has since been repaid. The Revolving Credit Facility is at present unutilised.

The maximum level of gearing under the Company's investment restrictions is 20% of the Company's net asset value.The Boardwill continue to reviewtheCompany's level of gearing, if any, on a regular basis.

⁽²⁾ This is a target only and there can be no assurance thatthe target can orwill be met and should not be taken as an indication of the Company's expected or actual future results. Accordingly, potential investors should not place any reliance on this targetin decidingwhether or notto investin theCompany or assume thatthe companywill make any distributions at all and should decide for themselves whether or not the target dividend yield is reasonable or achievable.

Chairman's Statement continued

The Board

As part oftheCompany's migration to the Premium Listing Segment of London Stock Exchange's Main Market the Company has made the following changes to the Board and its committees:

• Paul Burger was appointed as Senior Independent Director on 9 September 2019;
• Sylvia Coleman was appointed as an independent Non-Executive Director with eWect from 21 November 2019; and
• On 9 September 2019, the Board established a nomination committee and a remuneration committee which will be responsible for appointment and remuneration of Directors:

• Nomination Committee

Paul Burger has been appointed as theChairman oftheNominationCommittee. As the Board is comprisedwholly of independentNon-ExecutiveDirectors, all members ofthe Board are members of the Nomination Committee.

• Remuneration Committee

Simon Holden has been appointed as the Chairman of the Remuneration Committee. As the Board is comprisedwholly ofindependentNon-ExecutiveDirectors, all members of the Board are members of the Remuneration Committee.

Outlook

On behalf of the Board I would like to express my thanks to all of our Shareholders for their continuing support. The Company continues to work tirelessly to assemble a diversiXed portfolio of proven Songs, sourced by our Investment Adviser. Our pipeline of Catalogues remains very strong with a total investment value of over £1 billion and our investmentthesis remains as strong as it was at the time of our IPO. I look forward to updating you as we deploy our remaining capital.

Andrew Sutch Chairman

10 December 2019

Financial and Operational Highlights

As at 30 September 2019, the Company had raised a total of approximately £395 million (gross equity capital) through its Initial Public OWering on 11 July 2018, and subsequent placings in April 2019 and August 2019.

Catalogue Acquisitions during the period

As at 30 September 2019, the Company had deployed approximately £199.5 million during the interim period and £319.4 million in total since IPO on 27 Catalogues (7,475 Songs).

The Catalogues acquired as at 30 September 2019 are as below:
---------------------------------------------------------------

Catalogue	Acquisition Date	Interest Ownership	Total Songs
Terius Nash (The-Dream)	11 July 2018	75%	302
Jason Boyd (Poo Bear)	16 November 2018	100%	214
Bernard Edwards	28 November 2018	37.5%	290
TMS	7 December 2018	100%	121
Tricky Stewart	17 December 2018	100%	121
Giorgio Tuinfort	3 January 2019	100%	182
Itaal Shur	30 January 2019	100%	209
Rico Love	21 March 2019	100%	245
Sean Garrett	21 March 2019	100%	588
Johnta Austin	21 March 2019	100%	249
Ari Levine	31 March 2019	100%	76
Sam Hollander	31 March 2019	100%	499
Teddy Geiger	9 April 2019	100%	6
Starrah	23 April 2019	100%	73
David A. Stewart	10 May 2019	100%	1,068
Jamie Scott	21 May 2019	100%	144
Al Jackson Jr.	30 May 2019	100%	185
Michael Knox	10 June 2019	100%	110
Lyric Catalogue	12 June 2019	100%	571
Brian Kennedy	12 June 2019	100%	101
Jon Bellion	12 June 2019	100%	180
Neal Schon	21 June 2019	100%	357
Eric Bellinger	1 July 2019	100%	242
Jason Ingram	1 July 2019	100%	462
Andy Marvel	26 July 2019	100%	740
Benny Blanco	7 August 2019	100%	93
The Chainsmokers	20 August 2019	100%	47
Total			7,475

Financial and Operational Highlights continued

Key Metrics
	30 September 2019 £	31 March 2019 £
IFRS NAV(1)	389,448,352	198,558,826
Adjustments for revaluation of Catalogues of Songs to fair value	25,353,642	8,743,795
Reversal of IFRS amortisation	7,487,840	1,491,922
Operative NAV(2)	422,289,834	208,794,543
Operative NAV(2) per share	108.46p	103.27p
Middle market share price	107.50p	107.50p
(Discount)/Premium to Operative NAV	(0.9%)	4.10%
Ongoing charges Xgure (%)(3)(4)	1.76%	1.70%
Total dividends declared in respect of the period	2.5p	2.25p

• (1) Catalogues of Songs are classiXed as intangible assets and measured at amortised cost or cost less impairment in accordance with IFRS.
• (2) The Directors are of the opinion that an Operative NAV provides a meaningful alternative performance measure and the values of Catalogues of Songs are based on fair values produced by an Independent Valuer.
• (3) Alternative performance measure: annualised ongoing charges (£6,819,369) divided by average Operative NAV £387,161,801.Ongoing charges are those expenses of a typewhich are likely to recurin the foreseeable future,whether charged to capital or revenue, and which relate to the operation of the Company as a collective fund, excluding the costs of acquisition/disposal of investments, performance fees, Xnancing charges and gains/losses arising on investments. Ongoing charges are based on costs incurred in the year as being the best estimate of future costs.
• (4) The ongoing charges Xgure has been adjusted to exclude £1.5 million of exceptional expenses relating to the Working Capital Facility and Migration to the Premium Segment of the London Stock Exchange.

Financial and Operational Highlights continued

Share Price plus Total Dividend (From IPO to 10 December 2019)

Subsequent Events

Atthe end of September 2019,Hipgnosis transferred its entire issued share capitalto the Premium Listing Segment of the OZcial List of the FCA and to the London Stock Exchange's Premium segment of the Main Market ahead of a successful C Share raise in October of £231.0 million. The total capital raised since launch now stands at over £625 million.

Financial and Operational Highlights continued

Catalogue Acquisitions subsequent to the period end

As at 10 December 2019, the Company had deployed approximately £505.6 million on 42 Catalogues (11,225 Songs).

	Acquisition	Interest	Total
Catalogue	Date	Ownership	Songs
Timbaland	9 October 2019	100%	108
Journey*	17 October 2019	100%	103
10cc	17 October 2019	100%	29
Jaron Boyer	5 November 2019	100%	109
John Newman	7 November 2019	100%	47
Arthouse	15 November 2019	100%	44
Fraser T Smith*	25 November 2019	100%	298
Ammar Malik*	5 December 2019	100%	90
Kaiser Chiefs*	9 December 2019	100%	48
Ed Drewett*	9 December 2019	100%	109
Jack AntonoW*	10 December 2019	99%	188
Emile Haynie*	10 December 2019	100%	122
JeW Bhasker*	10 December 2019	100%	436
Brendan O'Brien*	10 December 2019	100%	1,855
Johnny McDaid*	10 December 2019	100%	164
Total to date			3,750

* These Catalogues have been allocated to the C Shares

Overview

Investment Adviser's Report

Introduction

I created the Company to establish proven songs as an asset class and give the investment community access to the predictable and reliable revenues generated by these incredible Songs. I am delighted to report on our second interim period where we are seeing excellent returns being generated from the Catalogues that we have acquired.

Since 31 March 2019, we have acquired a further 30 Catalogues which contain some of the most culturally important and commercially successful Songs of all time including Eurythmics' 'Sweet Dreams (AreMade ofThis)', Journey's 'Don't Stop Believin'',TheChainsmokers' 'Closer',Al Green's 'Let's Stay Together' and Ed Sheeran's 'Shape of You' and 'Castle On The Hill'.

I am thrilled that we now co-own Xve of the "Top 10 Songs of the Decade" as recently announced by BillboardMagazine.This includes the record breakingNumber 1 hit ofthe decade 'Uptown Funk' which topped the singles charts in 19 countries including staying at Number 1 on the Billboard Hot 100 for 14 consecutiveweeks making it one ofthe longestrunningNumber 1 singles ofthe decade. It also broke the US and worldwide streaming record whilst being certiXed 11x platinum in the US.

I am delighted that we have transferred our entire share capital to the gold standard of stock exchanges, the Premium Listing Segment of the London Stock Exchange. By complying with the highest standards of corporate governance I hope Hipgnosis is more accessible for all investors who want exposure to our incredible portfolio of Songs.

I mustthank all of our Shareholders fortheir endorsement of ourthesis and their continued support, particularly backing us with £282.1 million of new equity capital in the last four months, taking our total funds raised since launch 16 months ago to over £625 million. We remain the only listed fund globally that exclusivelyoWers exposure tothe uncorrelatedreturns generatedfromproven hit songs and we have lined up the Xnest available song Catalogues to quickly invest our remaining funds.

Market Conditions

The song and recorded music industry continues to grow driven by increasing streaming revenue as the number of paid subscribers to streaming platforms grows rapidly, bothwithin the established platforms and with new entrants moving into the marketplace.

Spotify recently announced thatit had 113 million premium subscribers at 30 September 2019, up 31% year-on-year. Spotify's total MAU (including paying and advertisement funded customers) in Q3 grew30% year-on-yearto 248 million.AppleMusic,the other marketleader, announced in June 2019 that it had passed 60 million paying subscribers, up from 50 million in June 2018. We expect another big announcement from them soon.

Whilst the U.S. remains the dominant territory in music streaming, accounting for 39% of global streaming revenue in 2019, Southeast Asia (excluding India) remains Spotify's fastest growing region, whilstIndia outperformed their forecasts by 30% this third quarter 2019. This continues to support the thesis that streaming will provide legitimate music revenues from emerging markets which were previously dominated by illegitimate consumption of music.

Market Conditions (continued)

ByteDance, the company behind the social media platform TikTok, is expected to launch a music streaming app next month with the aim of challenging Spotify, TencentMusic and Apple Music in Asia and India. ByteDance have held talks with several global music companies to strike deals for the new platform and it was recently revealed that it has amassed more than one billion monthly active users across its apps. The songs we have acquired by The Chainsmokers, Ariana Grande, Taylor Swift, Ed Sheeran, Camilla Cabello, Shawn Mendes and Justin Bieber are particularly important in this space.

Portfolio

As at 30 September 2019, the Company had acquired 27 Catalogues comprising 7,475 songs for a total of £319.4 million, representing a blended acquisition multiple of 12.84x historical average net income.

The Portfolio contained 1,061 Songs that have held Number 1 positions in global charts, 4,027 Songs that have held Top 10 chart positions and 15 Grammy award winning Songs. The Songs have been performed by globally successful artists including Eurythmics, Al Green, Diana Ross, Beyoncé, Rihanna, Adele, Justin Timberlake, Madonna, Britney Spears, Jay Z, Bruno Mars, Journey, Chic, Sister Sledge, Booker T & The MG's, Rudimental, Jess Glynne, One Direction, Mick Jagger,Tom Petty&TheHeartbreakers, 10cc, LittleMix, Justin Bieber,TheChainsmokers, Sugarhill Gang,CamillaCabello,MariahCarey,Mary J.Blige,NoDoubt, Gwen Stefani, Sia,David Guetta, Shaun Mendes, Maroon 5, Gwen Stefani, Stormzy, John Newman, James Morrison, Jason Aldean, Ariana Grande, Ed Sheeran, Taylor Swift, Mark Ronson, Kanye West, Pearl Jam, Bruce Springsteen, Red Hot Chilli Peppers, Harry Styles, Rick Ross, Rage Against The Machine, Panic At The Disco, TLC, Michael Jackson, Robbie Williams and Santana.The full list ofthe portfolio is detailed in the Financial and Operational Highlights on page 8.

The fair value of the Portfolio increased to £344.8 million (31 March 2019: £128.7 million), which reYects a fair value increase in the Portfolio, as determined by the Independent Valuer, of £16.6 million (+5.1%) since 31 March 2019 and £25.4 million (+7.9%) on acquisition cost, of which £15.6 million has been driven by like for like valuation increase excluding the impact of favourable changes to USD:GBP exchange rates. The increase in like for like valuation is primarily the result of the revenues being above forecasts impacting the expected earnings in the valuations prepared by the Independent Valuer.

Since the period end, we have acquired 15 new Catalogues for a total value of £186.1 million fully deploying allremaining investible cash attributable to the Ordinary Shares and deploying over 75% of the net proceeds of the October C Share raise. Following these acquisitions the blended acquisition multiple for the total portfolio will be 12.99x historical average net income. This slight increase is a result of some oftheCatalogues acquired being of an older vintage than the period end portfolio.

Portfolio (continued)

The full list of Catalogues acquired subsequent to the period end is set out in the Financial and OperationalHighlights on page 8.

These newly acquired Catalogues include the diamond certiXed 'Shape of You' by Ed Sheeran, 'Uptown Funk' by Mark Ronson featuring Bruno Mars and 'We Are Young' by Fun featuring Janelle Monáe representing that each of these hits has sold over 10 million copies in the US alone.

The newCatalogues also include theUS orUKNumber 1 or Platinum certiXed Songs: 'Promiscuous', 'Say It Right' and 'Maneater' by Nelly Furtado; 'Sexy Back', 'My Love', 'What Goes Around...Comes Around' and 'Suit&Tie' by JustinTimberlake; 'Holy Grail' by Jay-Zfeaturing JustinTimberlake; 'Give It To Me' by Timbaland featuring Nelly Furtado and Justin Timberlake; 'Try Again' by Aaliyah; 'Apologize' byTimbaland featuringOneRepublic; 'The Way IAre' byTimbaland featuring KeriHilson, D.O.E. vs. Sebastian; 'TalkingToTheMoon', 'Power' and 'Love Lockdown' by Kanye West; 'Amazing' by Kanye West featuring Young Jeezy; 'Runaway' by Kanye West featuring Pusha T; 'All Of The Lights' by Kanye Westfeaturing Rihanna; 'Monster' by Kanye Westfeaturing Jay-Z, Rick Ross,Nicki Minaj and Bon Iver; 'Run This Town' by Jay Z featuring Rihanna and Kanye West; 'Kiss It Better' by Rihanna; 'Girl On Fire' by Alicia Keys; 'Love Me Again' by John Newman; 'Locked Out Of Heaven', 'Young Girls' and 'Gorilla' by Bruno Mars; 'Summertime Sadness' by Lana Del Rey; 'Set Fire To The Rain' byAdele; 'Blinded By Your Grace, Pt. 2' by Stormzy featuringMNEK, 'Broken Strings' by James Morrison featuringNelly Furtado; 'Number 1' byTinchy StryderfeaturingN-Dubz; 'Break YourHeart' by Taio Cruz; 'Just Give Me A Reason' by Pink featuring Nate Ruess; 'Headlights' by Eminem featuring Nate Ruess; 'Some Nights' and 'Carry On' by Fun; 'Look What You Made Me Do' and 'Out Of The Woods' by Taylor Swift; 'Green Light' by Lorde; 'Stand By You' by Rachael Platten; Brave' by Sara Bareilles; 'Best Song Ever', 'StealMy Girl' and 'History' byOneDirection; 'SignOfTheTimes' by Harry Styles; 'All Time Low' and 'Glad You Came' by The Wanted; 'Black Magic' by Little Mix; 'Dear Darlin'' by Olly Murs; 'Rise' by Jonas Blue featuring Jack & Jack; 'Mama' by Jonas Blue featuring William Single; 'What About Us' and 'Beautiful Trauma' by Pink; 'Castle On The Hill', 'Photograph', 'Bloodstream', 'Tenerife Sea', 'What Do I Know', 'Supermarket Flowers' and 'Galway Girl' by Ed Sheehan; 'River' by Eminem featuring Ed Sheehan; 'Girls Like You' by Jason Aldean; 'Somewhere On A Beach' by Dierks Bentley; and 'Burning House' by Cam.

In addition the Catalogues include some ofthe mostinYuential albums in the history of rock music with the Red Hot Chilli Peppers' 'Blood Sugar Sex Magik', Pearl Jam's 'Vitology', Rage Against the Machine's 'Evil Empire' Stone Temple Pilots' 'Purple', and Bruce Springsteen's 'The Rising', 'Devils and Dust', 'Magic' and 'Working on a Dream' as well as the multi-platinum certiXed 'Born to Die' by LanaDelRey and KidCudi's 'Man on theMoon:The End ofDay' and 'Man on theMoon II:The Legend ofMr. Rager'. We have also increased our exposure to arguably the most popularAmerican band of the last 35 years with our Journey Catalogue acquisition, which includes the Songs 'Don't Stop Believin'', the best-selling digital track from the 20th century with over seven million copies sold in the US alone, as well as 'Anyway You Want It', 'Faithfully', 'Wheels In The Sky', 'Open Arms', and 'Who's Crying Now'.

Portfolio (continued)

Following these acquisitions we are very proud that Hipgnosis co-own Xve of the Billboard Magazine's "Top 10 Songs of the Decade" which was announced in November. The Songs were:

• o Number 1 'Uptown Funk' byMark Ronson featuring BrunoMarswhichwasNumber 1 in 19 countries and topped the Billboard Hot 100 for 14 weeks, is certiXed 11x platinum in the US and has been streamed over 1.1 billion times on Spotify alone.
• o Number 3 'Shape of You' by Ed Sheeran which was the best performing song of 2017 and was announced as the most streamed song of the decade after becoming the Xrst song to reach 2 billion streams. 'Shape of You'topped the singles charts in 34 countries including the US where it remained Number 1 for a record equalling 16 consecutive weeks and is certiXed diamond in 5 countries including in the US.
• o Number 4 'Closer' by The Chainsmokers featuring Halsey which reached Number 1 in over 10 countries and topped the Billboard Hot 100 for 12 consecutive weeks. It also became only the second song in the history ofthe Billboard Hot 100 to spend 32 weeks in the Top 10.
• o Number 5 ' Girls Like You' by Maroon 5 featuring Cardi B which topped the charts in 17 countries including spending 7 consecutive weeks at the top of the Billboard Hot 100.
• o Number 9 'Despacito' by Luis Fonsi and Daddy Yankee featuring Justin Bieber which topped the Billboard Hot 100 for a record equalling 16 consecutive weeks and became the Xrst Latin song to be certiXed diamond in the US.

Throughout our portfolio our Songs continue to experience commercial success and receive critical acclaim:

• 'TheseDays' co-written by Jamie Scottreceived the IvorNovello award for 'Most Performed Work'.
• At the 2019 Billboard Awards:
  • o The Chainsmokers took home the "Top Dance/Electronic Album" for their album 'Sick Boy' and "Top Dance/Electronic Artist".
  • o Panic! At the Disco were awarded "Top Rock Song" for 'High Hopes' and "Top Rock Album" for their album 'Pray for the Wicked', which Sam Hollander wrote nine songs on.
  • o 'Girls Like You' byMaroon 5 featuringCardi B,whichwas co-written by Starrah,won "Top Hot 100 Song", "Top Selling Song", "Top Radio Song" and "Top Collaboration".
• At time of writing, 'High Hopes', co-written by Sam Hollander, has spent 75 weeks in the Billboard Hot Rock Songs Chart, with 41 of those being at Number 1. It is also arguably the most synced song of 2019.

Overview

Portfolio (continued)

• Nile Rodgers curated 'Meltdown 2019' where he performed songs co-written with Bernard Edwards as Chic. David A. Stewart also launched his live show "The Eurythmics Songbook" at Meltdown 2019 to a sold out audience.
• JasonAldean earned his 23rd career and fourth consecutive radio charttopperwith 'Rearview Town' oW hisNumber 1 album 'RearviewTown'whichwas produced byMichael Knox.His new album '9' which was included in the Michael Knox deal is currently the Number 1 album on the Billboard sales chart andNumber 2 on the Billboard 200which combines sales and streaming. In addition to the producerroyalties itincludes four songswe co-ownwritten by Jaron Boyer.
• In November, Journey and David A. Stewart were announced as nominees for the 2020 Songwriters Hall of Fame.
• Nile Rodgers & Chic had an incredibly successful summertour ofthe UK and Europe and now continue to tour the US with Cher performing numerous hits from our Bernard Edwards Catalogue.
• Celine Dion's new album 'Courage' including our single 'Lying Down' by Giorgio Tuinfort is currently Top 5 all over the world and has just been Number 1 in the US.
• Beyoncé's 'Homecoming' movie (and album) includes more than 14 of our songs and in addition to being a massive success has just been nominated for a 2020 Grammy Award.
• Shawn Mendes continues his world tour one of the most successful of 2019 globally performing all of the songs we co-own via several of his co-writers.
• Adele's album '21',which includes 'Set FireToThe Rain' co-written and produced by FraserT. Smith, has reached 2.5 billion streams on Spotify alone.
• Eurythmics David A. Stewart and Annie Lennox reunited for the Xrst time in 14 years for Sting's Rainforest Fund beneXt playing 3 Songs from our Portfolio.

Financial Review

Net income for the portfolio increased to £22.6 million (Financial period from incorporation to 31 March 2019: £7.2 million).

The portfolio netincome include some non-recurring revenues onCatalogues acquired during the period, most notably due to:

• The right-to-income received as part of the Catalogue acquisition, which is typically dependent on the timing of the negotiations;
• On acquisition, the Company is required to accrue for all revenues due to the Company for whichPROrevenue statements have not yet been received, butwhere theCompany is already entitled to the share.Due to the signiXcanttiming diWerences inherentwithPROrevenues,this one oW accrual can be material.

Financial Review (continued)

Due to these non-recurring revenue items, the most meaningful way of monitoring performance of our Catalogues is by comparing revenue statements received with our internal forecasts and prior period actuals. We are pleased that the revenue statements received during the period have been ahead of our forecasts with Benny Blanco's and The Chainsmokers' Catalogues performing particularlywell aswell as ourAri Levine,Neal Schon, Bernard Edwards and Itaal ShurCatalogues all growing strongly on the comparative period in the prior year. In addition, streaming revenues have performed well, and ahead of our forecasts, with 15% growth in the Xrst half of 2019 compared to the second half of 2018.

Administration expenses (which include the fees payable to the Investment Adviser, acquisition costs and administration costs) increased to £3.4 million reYecting the increased size of the Company.These do notinclude £1.5 million of exceptional expenses relating to the WorkingCapital Facility and Migration to the Premium Segment of the London Stock Exchange. Our ongoing charges Xgure increased to 1.76% (Financial period from incorporation to 31 March 2019: 1.70%) as a result of increased due diligence and other acquisition costs as we made a greater number of acquisitions compared to the prior period and commenced work on a signiXcant pipeline of Catalogues for acquisition in the second half of the year.

After administration expenses the adjusted operating proXt(1) for the period before tax was £14.1 million leading to an adjusted EPS(1) of 3.55p perOrdinary Share.Our basic EPS grewto 3.19p, fully covering our dividends totalling 2.5p per Ordinary Share relating to the period.

TheCompany'sNAVis calculated both underIFRS (which principally requires the cost of purchased Catalogues to be amortised downwards to reYectthe reducing copyrightlife of eachCatalogue) and on an OperativeNAV basis (which reYects the fair value oftheCompany'sCatalogues as valued by an Independent Valuer). The Operative NAV as at 30 September 2019 was £422.3 million or 108.46p per Ordinary Share, reYecting an increase per Ordinary Share of 5.03% compared to the end of the prior Xnancial year. The fair value of the Portfolio, as determined by an Independent Valuer, increased to £344.8 million.

Including the dividends of 2.5p perOrdinary Shares paid during the period the totalNAVreturnwas 7.45% for the interim period and 11.96% since IPO (these Xgures do not include the dividend of 1.25p per Ordinary Share paid after the period end on 29 November 2019).

Subsequent Events and Outlook

Our excellent Xrst half is a testamentto the quality ofthe Songs thatwe have acquired to date and are proud to see so many of ourCatalogues performing sowell. The latestresults from Spotify and Apple continue to show unbelievable growth in premium streaming as the world changes the way it consumes music. Streaming growth, both in the Westernworld and emerging markets, is driving proven hit Songs revenues and therefore drives values up.Most excitinglywith forecasts of 2 billion paid subscribers by 2030, we are only at the start.

(1) Excludes £1.5 million of exceptional expenses relating to the WorkingCapital Facility andMigration to the Premium Segment of the London Stock Exchange.

Subsequent Events and Outlook (continued)

One step at a time, we are amassing the leverage and the support necessary to bring positive change towhere the songwriter sits in the economic equation.The songwriteris more responsible than anyone for the success of an artist and the music industry in 2019 and they and their songs must be properly recognized. Important steps have been taken by the Copyright Board and with the Music Modernisation Act to acknowledge this but this is just the tip of the iceberg. We will use ourleverage and supportto positively impactwhere the songwriter sitswhich is not only important for the creative community but is in total alignment with the best interest of our investors.

Withinvestorsneedinguncorrelatedassetsmorethanever, andprovenSongsproducingreliableand predictableincome,thenewasset classofprovenSongs is, inour view,nowmoreinvestiblethangold and oil.

With over £1 billion in ourinvestment pipeline,the Songs andCatalogueswe are acquiring overthe next days, weeks and months are just as impressive as what we have put together in our Xrst 16 months and will also skew the vintage of the overall portfolio older.

We would like to thank all our Shareholders for supporting our thesis that songs are a new highly investible asset class and we look forward to updating them as we acquire some of the greatest songs of our time in the coming months. Equally well we would like to thank all of the incredible songwriters for entrusting us as custodians of these great songs which are not only the currency of the music industry but such a special and important part of everyone's life.

Merck Mercuriadis

Founder of Hipgnosis Songs Fund Limited and CEO of The Family (Music) Limited (Investment Adviser to Hipgnosis Songs Fund Limited)

10 December 2019

Investment Objective and Policy

Investment Objective

The Company's investment objective is to provide Shareholders with an attractive and growing level of income, together with the potential for capital growth, from investment in a portfolio of Songs and their associated musical intellectual property rights. The Portfolio has been created by investing in Catalogues of proven established Songs from well-known songwriters and recording artists. However, each Song will be considered to be a separate asset.

Investment Policy

The Company's investment policy is to diversify risk through investment in a Catalogue of Songs and associated musical intellectual property rights. The Company will seek, but is not required, to acquire 100 percent of a songwriter's copyright interest in each song, which would comprise their songwriter's share, their publisher's share and their performance rights. In appropriate cases, however, the Company may not acquire all three elements of the songwriter's interest and may also acquire peripheral interests such as producer royalties on a songwriter's copyright interest. TheCompanywill acquire interests in Songswhich are sole authored or co-authored.TheCompany may also acquire interests in Songs jointly with another purchaser.

TheCompanywill, directly orindirectly via collection agents, enterinto licensing agreements, under which theCompanywillreceive payments attributable to the copyrightinterests in the Songswhich it owns. Such payments may take the form of royalties and/or licence fees, including:

• mechanical royalties when a copy of a song is made, whether physical (e.g. CDs, DVDs) or digital (e.g. permanent downloads, streaming, webcast);
• performance royalties when a song is performed live or broadcast on TV or Radio, or when a song is streamed online; and
• synchronisation fees when a song is used in another form of media (e.g. movie, TV show, video game, advertisement).

TheCompanywill focus on delivering income growth and capital growth by pursuing eZciencies in the collection of payments and active management of the Songs it owns.

TheCompany may acquire Songs for consideration consisting of cash, Shares or a combination of cash and Shares, and payment of part of the consideration may be on deferred terms.

WhilsttheCompany does notintend to sellthe Songs it owns, it may make disposals of Songswhere it considers such a disposal to be in the best interests of Shareholders.

Investment Objective and Policy continued

Investment restrictions

The Company will at all times invest and manage its assets, mindful of spreading risk and in accordance with its published investment policy.

TheCompanywill investits assets andmanagetheSongs it acquireswiththeobjectiveof constructing a high quality and diversiXedPortfolioofSongs.TheCompanywill acquireCatalogues froma number of diWerent songwriters, which will include Songs diversiXed across music genres and sung by numerous recording artists. TheCompanywill be subjectto the following investmentrestrictions:

• a) the Company will hold interests in a minimum of 300 Songs once fully invested;
• b) the value of any single Songwill notrepresent more than 10 percent oftheCompany's Gross Assets, calculated at the date of the acquisition of such Song (and re-calculated in the aggregate upon the acquisition of any additional interest in a Song). In the event this limit is breached at any point afterthe relevantinvestment has been made or added to (for example due to a change in valuation of any Song), there will be no requirement to sell any Song, in whole or in part; and
• c) theCompanywillnotinvestinclosed-endedinvestment companiesorotherinvestmentfunds.

The Company is fully compliant with these investment restrictions.

Cash management

TheCompany's uninvested capital may be invested in cash, cash equivalents, near cash instruments and money market instruments.

Hedging and derivatives

TheCompany may utilise derivatives for eZcient portfolio management. In particular,theDirectors may engage in full or partial foreign currency hedging and interest rate hedging. The Company will not enter into such arrangements for investment purposes.

Leverage

The Company may incur indebtedness of up to a maximum of 20 percent of its Net Asset Value, calculated at the time of drawdown.

Amendments to and compliance with the Investment Objective and Policy

Any material change to the Company's Investment Objective and Policy will be made only with the prior approval of the Shareholders by ordinary resolution.

In the event of a material breach of any of the investment restrictions applicable to the Company, Shareholderswill be informed ofthe actions to be taken by theCompany through an announcement issued via London Stock Exchange's Regulatory News Service.

Directors' Responsibility Statement

The Directors are responsible for preparing this Interim Report in accordance with applicable laws and regulations. The Directors conXrm that to the best of their knowledge:

• The Condensed Consolidated Financial Statements have been prepared in accordance with IAS 34 Interim Financial Reporting; and
• The Chairman's Statement and Investment Adviser's Report include a fair review of the information required by:
  • (i) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an indication of important events that have occurred during the Xrst period of the Xnancial year; their impact on the condensed set of consolidated Xnancial statements; and a description of the principal risks and uncertainties of the remaining six months of the year; and
  • (ii) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the Xrst period ofthe current Xnancial year and that have materially aWected the Xnancial position or performance of the Company during that period.

On behalf of the Board

Andrew Sutch

Chairman

10 December 2019

Condensed Consolidated Statement of Comprehensive Income

For the six months ended 30 September 2019 (unaudited)

		1 April 2019 to 30 September 2019	8 June 2018 to 31 March 2019
	Notes	£	£ (Audited)
Income
Total revenue	8	22,641,230	7,218,852
Interest income		584,507	682,491
Foreign exchange gains on non-investments		281,461	104,773
Total income		23,507,198	8,006,116
Expenses
Advisory fees	12	(1,781,447)	(1,579,190)
Amortisation of Catalogues of Songs	5	(5,995,918)	(1,491,922)
Performance fee		—	(429,054)
Administration fees		(344,918)	(155,954)
Directors' remuneration		(94,375)	(121,936)
Broker fees		(31,289)	(44,550)
Audit fees		(55,000)	(110,000)
Legal & professional fees		(726,631)	(813,714)
Exceptional Costs	9	(1,460,337)	—
Loan interest		(52,109)	—
Other operating expenses		(333,258)	(267,821)
Total expenses		(10,875,282)	(5,014,141)
Operating proJt for the period before tax		12,631,916	2,991,975
Taxation	4	(1,909,309)	(632,521)
ProJt for the period after tax		10,722,607	2,359,454
Total comprehensive income for the period		10,722,607	2,359,454
Basic Earnings per Share (pence)	13	3.19	1.17
Diluted Earnings per Share (pence)	13	3.19	1.17

All activities derive from continuing operations.

Condensed Consolidated Statement of Financial Position

As at 30 September 2019

	Notes	30 September 2019 £	31 March 2019 £ (Audited)	Ov er vi ew
Assets Catalogues of Songs	5	311,944,580	118,458,818
Cash and cash equivalents		66,235,378	108,483,752
Trade and other receivables		32,298,738	10,808,398
Total assets		410,478,696	237,750,968
Liabilities				Go ve
Bank loan	6	13,750,000	—	rn an
Other payables and accrued expenses		7,280,344	39,192,142	ce
Total liabilities		21,030,344	39,192,142
Net assets		389,448,352	198,558,826
Equity
Share capital	7	386,911,229	198,221,140
Retained earnings		2,537,123	337,686	Fi na
Total equity attributable to the owners of the Company		389,448,352	198,558,826	nc ia
Number of ordinary shares in issue at period end	7	389,356,341	202,176,800	l St at
Bridge to Operative NAV				em en ts
IFRS Net Asset Value per ordinary share (pence)		100.02	98.21
Adjustments for revaluation of Catalogues of Songs to
fair value (pence)		6.51	4.32	O th
Reversal of amortisation (pence)		1.93	0.74	er In
Operative Net Asset Value per ordinary share (pence)		108.46	103.27	fo rm at
				io n

Approved and authorised for issue by the Board ofDirectors on 10December 2019 and signed on their behalf by:

Chairman Director

Andrew Sutch Andrew Wilkinson

TheaccompanyingnotesformanintegralpartoftheseCondensedConsolidatedFinancialStatements.

Condensed Consolidated Statement of Changes in Equity

For the six months ended 30 September 2019 (unaudited)

	Notes	Number of shares	Share capital £	Retained earnings £	Total equity £
As at 1 April 2019		202,176,800	198,221,140	337,686	198,558,826
Shares issued	7	187,179,541	192,618,166	—	192,618,166
Share issue costs	7	—	(3,928,077)	—	(3,928,077)
Dividends paid	10	—	—	(8,523,170)	(8,523,170)
ProXt for the period		—	—	10,722,607	10,722,607
As at 30 September 2019		389,356,341	386,911,229	2,537,123	389,448,352
		Number of shares	Share capital £	Retained earnings £	Total equity £
	Notes	(Audited)	(Audited)	(Audited)	(Audited)
As at 8 June 2018		—	—	—	—
Shares issued	7	202,176,800	202,176,800	—	202,176,800
Share issue costs	7	—	(3,955,660)	—	(3,955,660)
Dividends paid	10	—	—	(2,021,768)	(2,021,768)
ProXt for the period		—	—	2,359,454	2,359,454
As at 31 March 2019		202,176,800	198,221,140	337,686	198,558,826

Condensed Consolidated Statement of Cash Flows

For the six months ended 30 September 2019 (unaudited)

	Notes	1 April 2019 to 30 September 2019 £	8 June 2018 to 30 September 2018 £	Ov er vi ew
Net cash used in operating activities
Operating proXt/(loss) for the period before taxation Adjustments for non-cash items:		12,631,916	(534,274)
Movement in other receivables		(21,490,340)	(664,436)
Movement in other payables and accrued expenses		(33,768,998)	156,828
Amortisation of Catalogues of Songs	5	5,995,918	—	Go
Foreign exchange losses on non-investments		(281,461)	—	ve
		(36,912,965)	(1,041,882)	rn an
Purchase of Catalogues of Songs	5	(199,481,680)	(18,016,923)	ce
Net cash used in operating activities		(236,394,645)	(19,058,805)
Net cash generated from Jnancing activities
Proceeds from issue of shares	7	192,618,166	202,176,800
Issue costs paid	7	(3,928,077)	(3,955,660)
Dividends paid	10	(8,523,170)	—	Fi
Bank loan	6	13,697,891	—	na
Net cash generated from Jnancing activities		193,864,810	198,221,140	nc ia l
Net movement in cash and cash equivalents		(42,529,835)	179,162,335	St at
Cash and cash equivalents at the start of the period		108,483,752	—	em en
EWect of foreign exchange rate changes		281,461	195	ts
Cash and cash equivalents at the end of the period		66,235,378	179,162,530

Notes to the Condensed Consolidated Financial Statements

Forthe six months ended 30 September 2019

1. General information

Hipgnosis Songs Fund Limited was incorporated and registered in Guernsey on 8 June 2018 with registered number 65158 and is governed in accordancewith the provisions oftheCompanies Law. With eWectfrom 29April 2019,the registered oZce address is Floor 2, POBox 286,TrafalgarCourt, Les Banques, St Peter Port, Guernsey, GY1 4LY.

TheCompany's shareswere admitted to the SFS oftheMainMarket ofthe London Stock Exchange on 11 July 2018. Subsequently, the Company's shares were admitted to the Premium Listing Segment of the OZcial List of the FCA from 19 September 2019.

The Company makes its investments through its subsidiaries, which are registered in the UK as limited companies, inwhich theCompany is the sole shareholder.The principal place of business of the subsidiaries is the UK.

The Condensed Consolidated Financial Statements present the results of the Group for the six months ended 30 September 2019. The Group is principally engaged in investing in and managing music copyrights and associated musical intellectual property.

2. Accounting policies

a) Basis of preparation

The Condensed Consolidated Financial Statements included in this Interim Report have been prepared in accordance with IAS 34 'Interim Financial Reporting' and the Disclosure and Transparency Rules of the FCA.

The Condensed Consolidated Financial Statements do not include all the information and disclosures required in the Annual Report and should be read in conjunction with the Company's Annual Report for the year ended 31 March 2019, which are available on the Company's website (www.hipgnosissongs.com). The Annual Report has been prepared in accordance with IFRS.

The same accounting policies and methods of computation have been followed in the preparation oftheseCondensedConsolidated Financial Statements as in theAnnual Reportforthe year ended 31 March 2019.

TheCompany applied,forthe Xrsttime, certain standards and amendments,which are eWective for annual periods beginning on or after 1 January 2019.The newstandards or amendments to existing standards and interpretations, eWective from 1 January 2019, did not have a material impact on the Company's Condensed Consolidated Financial Statements. Itis not anticipated that any standard which is not yet eWective, will have a material impact on the Company's Xnancial position or on the performance of the Company's statements.

Financial Statements continued

Forthe six months ended 30 September 2019

2. Accounting policies continued

b) Group information

As at 30 September 2019, the details of the Company's subsidiaries are as follows:

Name of the subsidiary	Place of incorporation and operation	% of voting rights	% Interest	Consolidation method
Hipgnosis Holdings UK Limited Hipgnosis SFH I Limited	UK UK	100 100	100 100	Full Full
Hipgnosis SFH II Limited	UK	100	100	Full
Hipgnosis SFH III Limited	UK	100	100	Full
Hipgnosis SFH IV Limited	UK	100	100	Full
Hipgnosis SFH V Limited	UK	100	100	Full
Hipgnosis SFH VI Limited	UK	100	100	Full
Hipgnosis SFH VII Limited	UK	100	100	Full
Hipgnosis SFH VIII Limited	UK	100	100	Full
Hipgnosis SFH IX Limited	UK	100	100	Full
Hipgnosis SFH X Limited	UK	100	100	Full
Hipgnosis SFH XI Limited	UK	100	100	Full
Hipgnosis SFH XII Limited	UK	100	100	Full
Hipgnosis SFH XIII Limited	UK	100	100	Full
Hipgnosis SFH XIV Limited	UK	100	100	Full
Hipgnosis SFH XV Limited	UK	100	100	Full
Hipgnosis SFH XVI Limited	UK	100	100	Full
Hipgnosis SFH XVII Limited	UK	100	100	Full
Hipgnosis SFH XVIII Limited	UK	100	100	Full
Hipgnosis SFH XIX Limited*	UK	100	100	Full
Hipgnosis SFH XX Limited	UK	100	100	Full

*This subsidiary was dormant as at 30 September 2019 in anticipation of new Catalogues being acquired.

The subsidiaries of the Company are considered tax resident in the UK and are subject to UK corporation tax.

c) Going concern

TheDirectors monitorthe capital and liquidity requirements oftheCompany and its subsidiaries on a regular basis. They have also reviewed cash Yow forecasts prepared by the Investment Adviser which are based in part on assumptions about the future purchase and returns from existing Catalogues of Songs and the annual operating cost.

Basedonthesesourcesofinformationandtheirownjudgement,theDirectorsbelieveitis appropriate topreparetheCondensedConsolidatedFinancialStatementsoftheGrouponagoingconcernbasis. ## Notes to the Condensed Consolidated Financial Statements continued

Forthe six months ended 30 September 2019

2. Accounting policies continued

d) Segmentalreporting

The chief operating decision maker is the Board of Directors. While the Company's income is derived internationally, the Directors are of the opinion that the Group is engaged in a single segment of business, being the investment ofthe Group's capital in the Portfolio,with an attractive and growing level of income, together with the potential for capital growth.

3. SigniJcant accounting judgements, estimates and assumptions

The preparation of the Group's Condensed Consolidated Financial Statements requires the application of estimates and assumptions which may aWect the results reported in the Xnancial statements. Uncertainty about these estimates and assumptions could result in outcomes that require a material adjustment to the carrying amount of the asset or liability aWected in future periods. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods aWected.

The key assumptions concerning the future and other key sources of estimation uncertainty atthe reporting date, that have a signiXcant risk of resulting in a material adjustment to the carrying amounts of assets and liabilitieswithin the next Xnancial year, are discussed below.The Group based its assumptions and made estimates based on the information available when the Condensed Consolidated Financial Statements were prepared. However these assumptions and estimates may change based on market changes or circumstances beyond the control of the Group.

Critical estimates in applying theGroup's accounting policies – revenue recognition:

Estimated royalty revenue receivable is accrued for on the basis of historical earnings for each catalogue, which incorporates an element of uncertainty. The estimated revenue accrual may not therefore directly equal the actual cash received in respect of each accounting period and adjustments may therefore be required throughout the Xnancial period when the actual revenue received is known, and these adjustments may be material.

Net revenues also include an accrual for performance income, to account for the Writer's Share of performance royaltieswhich are subjecttoa signiXcanttime lag in reporting in the industry, butwhich the Company is entitled to receive in due course. In recommending the estimate of this accrual to theBoardofDirectors and the auditors,the InvestmentAdviser used its analysisof eachCatalogue's revenue history as well its knowledge of the respective Catalogue performance trends to recommend the estimated accruals. The PRO income accrual is based on analysis of each Catalogue's revenue history aswell as knowledgeofthe respectiveCatalogue's performance trends.

Financial Statements continued

Forthe six months ended 30 September 2019

3. SigniJcant accountingjudgements, estimates andassumptions continued

Assessment of useful life of intangible assets

In orderto calculate the amortised cost ofthe intangible assets itis necessary to assess the useful economic life of the copyright interests in Songs. This requires forecasts of the expected future revenue from the copyright interests, which contains signiXcant uncertainties as the ongoing popularity of a Song can Yuctuate unexpectedly.

The actual useful life of a Catalogue depends on the Catalogue's genre and listener demographic. Analysis of earnings shows that payback periods of purchase prices at industry standard multiples generally range from 10-15 years. Additionally, the term of administration deals in the market between songwriters and publishers are no longer than 25 years, and generally range from 15-20 years.This reYects the general consensus thatthe beneXts from exploiting revenues from thework of Anglo-American music songwriters can be reliably estimated over a period of 10-20 years and no longer, due to uncertainty in forecasting over a longer period of time and the level of technological disruption that the industry is subject to.

Calculation of OperativeNAV

In order to calculate the Operative NAV and Operative NAV per Share, the intangible assets are revalued to an estimate offair value.The fair value estimates are also used to assesswhetherthere is evidence that the intangible assets may be impaired.

Valuations of music publishing rights typically adoptthe DCF valuation approach which measures the present value of anticipated future revenues from acquiring the Catalogues, which are discounted at a 'market cost of capital' and a terminal value in 10 years. This method is accepted as an objective way of measuring future beneXts; taking into account income projections from various music industry sources across various revenue Yowswhilst also factoring in the associated cost of capital.

Catalogues of Songs are valued on an ongoing basis using a DCF valuation methodology which is consistent with the Independent Valuers.

Assessment of impairment

Intangible assets with an indeXnite useful life are subject to annual impairment review which relies on assumptions made by the Board. Assumptions are updated annually, speciXcally those relating to future cash Yows and discount rates.

Financial Statements continued

Forthe six months ended 30 September 2019

4. Taxes

TheCompany is exemptfrom taxation in Guernsey underthe provisions ofthe IncomeTax (Exempt Bodies) (Guernsey) Ordinance, 2008 and is charged an annual fee of £1,200.

The Directors have been advised that following certain changes to the United Kingdom tax rules regarding "alternative investment funds" implemented by the Finance Act 2014 and contained in section 363A of the Taxation (International and other Provisions) Act 2010 the Company should not be residentin theUnited Kingdom forUnited Kingdom tax purposes.Accordingly, and provided thattheCompany does not carry on a trade in theUK (whether or notthrough a branch, agency or permanent establishment situated therein), the Company will not be subject to UK income tax or corporation tax other than on any UK source income.

TheUK subsidiaries oftheCompany are tax residentin theUK and are subjecttoUK corporation tax.

5. Catalogues of Songs
	£
Cost
At 1 April 2019	119,950,740
Addition	199,481,680
At 30 September 2019	319,432,420
Amortisation and impairment
At 1 April 2019	1,491,922
Amortisation	5,995,918
Impairment	—
At 30 September 2019	7,487,840
Net book value
At 1 April 2019	118,458,818
At 30 September 2019	311,944,580
Fair value as at 30 September 2019	344,786,060

Financial Statements continued

Forthe six months ended 30 September 2019

5. Catalogues of Songs continued	Ov er
	vi £ ew (Audited)
Cost
At 8 June 2018	—
Additions	119,950,740
At 31 March 2019	119,950,740
Amortisation and impairment	Go
At 8 June 2018	— ve rn
Amortisation Impairment	1,491,922 an — ce
At 31 March 2019	1,491,922
Net book value At 8 June 2018	—
At 31 March 2019	118,458,818
Fair value as at 31 March 2019	Fi na 128,694,535
	nc ia l

The Group amortisesCatalogues of Songswith a limited useful life using the straight-line method of 20 years (otherthan in exceptional circumstances for speciXcCatalogues of Songs).Useful life is separately considered for each Catalogue of Songs and is reviewed at the end of each reporting period.

The Board engaged an IndependentValuer, MassarskyConsulting, Inc.,to value theCatalogues as at 30 September 2019. Each income type from each Catalogue was analysed and forecasted to derive the fair value of the Catalogues by adopting a DCF valuation methodology. Income was analysed and forecast atthe level of each individualCatalogue and by income type. Future revenues were also estimated, often at the level of individual Songs, and incorporated into their valuation. Massarsky Consulting has also taken into consideration macro factors including the growth of streaming revenue and the global growth ofthe recorded music industry in their analysis.The Board has approved and adopted the valuations prepared by the Independent Valuer.

Statements

OtherInformation

Financial Statements continued

Forthe six months ended 30 September 2019

6. Bank loan

On 29 August 2019, the Company signed a Revolving Credit Facility of £65 million with JPMorgan Chase Bank. The facility is available for three years and the Company may request to increase the commitment by a further £35 million, subject to certain conditions. On 30 September 2019, principal of £13,750,000 remained outstanding,whichwas initially drawn down on 30 August 2019. This was subsequently repaid on 31 October 2019. Interest in the amount of £52,109 was paid on 30 September 2019.

7. Share capital and capital management

The share capital of the Company may consist of an unlimited number of: (i) ordinary shares of no par value which upon issue the Directors may classify as Ordinary Shares; and (ii) C Shares denominated in such currencies as the Directors may determine.

No.
202,176,800
138,750,000
48,429,541
389,356,341
£
202,176,800
141,525,000
51,093,166 (7,883,737)

Financial Statements continued

Forthe six months ended 30 September 2019

7. Share capital and capital management continued	Ov er
	vi No. ew
Issued and fully paid
Shares issued on 11 July 2018	202,176,800
Shares as at 31 March 2019	202,176,800
	£
	(Audited)
Issued and fully paid	Go
Proceeds from shares issued on 11 July 2018	ve 202,176,800
Share issue costs	rn (3,955,660) an
Shares as at 31 March 2019	ce 198,221,140

Under the Company's Articles of Incorporation, each Shareholder present in person or by proxy has the rightto one vote at general meetings.On a poll, each Shareholderis entitled to one vote for every Ordinary Share held.

Shareholders are entitled to all dividends paid by the Company and, on a winding up, provided the Company has satisXed all of its liabilities, the Shareholders are entitled to all of the residual assets of the Company.

8. Revenue
	1 April 2019 to 30 September	8 June 2018 to 30 September 2018 £
	2019
	£
Mechanical income	1,391,295	21,249
Performance income	4,201,061	33,925
Digital downloads income	1,028,665	27,674
Streaming income	4,653,236	74,614
Synchronization income	2,030,838	41,795
Writer's Share income	8,189,913	119,591
Producer royalties	577,165	—
Masters income	32,336	—
Other income	536,721	66,166
Totalrevenue	22,641,230	385,014

Financial Statements

OtherInformation

Financial Statements continued

Forthe six months ended 30 September 2019

9. Exceptional Costs

Includedwithin exceptional costs of £1.5 million are non-recurring amounts relating to the arrangement ofthe Company's Revolving Credit Facility with JP Morgan Chase Bank.

10. Dividends

A summary of the dividends is set out below:

1 April 2019 to 30 September 2019	Dividend per share Pence	Total dividend £
Interim dividend in respect of period ended 31 March 2019 Interim dividend in respect of period ended 30 June 2019	1.25 1.25	4,261,585 4,261,585
	2.50	8,523,170
8 June 2018 to 31 March 2019	Dividend per share Pence	Total dividend £
Interim dividend in respect of period ended 30 September 2018 Interim dividend in respect of period ended 31 December 2018	0.50 0.50	1,010,884 1,010,884

The Company announced its third interim dividend for the previous Xnancial year, for the period from 1 January to 31 March 2019 of 1.25 pence per Ordinary Share. The interim dividend was paid to Shareholders on the register at the close of business on 3 May 2019 on 31 May 2019.

TheCompany announced its Xrstinterim dividend forthe current Xnancial year,forthe period from 1 April to 30 June 2019, of 1.25 pence per Ordinary Share. The interim dividend was paid to Shareholders, on the register at the close of business on 2 August 2019, on 30 August 2019.

Subsequent to the period end, the Company announced its second interim dividend for the period from 1 July 2019 to 30 September 2019 of 1.25 pence per Ordinary Share. The dividend was paid to Shareholders, on the register at the close of business on 1 November 2019, on 29 November 2019.

Financial Statements continued

Forthe six months ended 30 September 2019

11. Financial Risk Management

Financial Risk Management Objectives

TheCompany's activities expose itto various types of Xnancialrisk, principally marketrisk, creditrisk, and liquidity risk. The Board has overallresponsibility fortheCompany's risk management and sets policies to manage those risks at an acceptable level.

The Company's principalrisk factors are fully discussed in the Company's Prospectus, available on the Company's website (www.hipgnosissongs.com) and should be reviewed by Shareholders.

12. Related Party Transactions and Directors' Remuneration

Parties are considered to be related if one party has the ability to controlthe other party or exercise signiXcant inYuence over the party in making Xnancial or operational decisions.

Directors

As at 30 September 2019 the Company has four Directors (31 March 2019: four).

Directors' fees for the period to 30 September 2019 amounted to £94,375 (30 September 2018: £43,603), of which £nil (31 March 2019: £nil) was outstanding at the period end.

Investment Adviser

The Company has entered into an Investment Advisory Agreement with the Investment Adviser pursuantto which the Investment Adviser will source Songs and provide recommendations to the Board on acquisition and disposal strategies, manage and monitor royalty and/or fee income due to theCompany from its copyrights and collection agents, and develop strategies to maximise the earning potential ofthe Songs in the portfolio through improved placement and coverage of Songs.

Investment Adviser fees for the period were £1,781,447 (30 September 2018: £500,500) with £305,897 (31 March 2019: £nil) outstanding at the reporting date.

Financial Statements continued

Forthe six months ended 30 September 2019

13. Earnings per share

	30 September 2019 Basic Diluted		30 September 2018 Basic Diluted
ProXt/(Loss) for the period (£)	10,722,607	10,722,607	(736,322)	(736,322)
Weighted average number of Ordinary Shares in issue	336,506,009	336,506,009	202,176,800	202,176,800
Earnings/(Loss) per Share (pence)	3.19	3.19	(0.36)	(0.36)

The earnings per share is based on the proXt orloss ofthe Group forthe period and on theweighted average number of Ordinary Shares for the period.

14. Subsequent events

On 22 October 2019 the Company issued 231 million new C Shares. These shares were issued at a price of 100 pence per C Share,raising gross proceeds of £231 million. Following the issue,there are 389,356,341 Ordinary Shares and 231,000,000 C Shares in issue. The C Shares carry the right to receive notice of, attend and vote at general meetings oftheCompany.TheCompany does not hold any Ordinary Shares in treasury. Therefore,the total number of voting rights ofthe Company will be 620,356,341 and this Xgure may be used by Shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

Following the issueofCShareson22October2019,AndrewSutch purchased20,000CShares.Paul Burger, Andrew Wilkinson and SimonHolden each purchased 10,000CShares on the same day.

On 24October 2019 theCompany announced its second interim dividend forthe period from 1 July 2019 to 30 September 2019 of 1.25 pence per Ordinary Share. The dividend was paid to Shareholders, on the register atthe close of business on 1November 2019, on 29November 2019.

Further catalogueswere acquired afterthe period ended 30September 2019, as setoutonPage 11.

There were no other material events after the period end to the date on which these Condensed Consolidated Financial Statements were approved.

Glossary of Capitalised DeJned Terms

"Administrator" means Estera International Fund Managers (Guernsey) Limited;

"Admission" means admission, on 11 July 2018, to trading on the SFS of the London Stock Exchange, of the Ordinary Shares becoming eWective in accordance with the Listing Rules and/or the LSE Admission Standards;

"AIC" means the Association of Investment Companies;

"AIC Code" means the AIC Code of Corporate Governance;

"AIC Guide" means the AIC Corporate Governance Guide for Investment Companies;

"Annual General Meeting" or "AGM" means the annual general meeting of the Company;

"Annual Report" means the annual publication of the Company provided to the Shareholders to describe their operations and Xnancial conditions, together with their Consolidated Financial Statements;

"Apple Music" means the music and video streaming service developed by Apple Inc.;

"Articles of Incorporation" or "Articles" means the articles of incorporation of the Company;

"AssetManagementCommittee" means a committeewhich considers the ongoing management and revenue maximisation of the Catalogues of Songs;

"Audit and Risk Management Committee" means a formal committee ofthe Board with deXned terms of reference;

"Board" or "Directors" means the Directors of the Company;

"BMI" means Broadcast Music, Inc.;

"C Shares" means a temporary and separate class of shares which are issued at a Xxed price determined by the Company;

"Catalogue" means one or more Songs acquired from a single songwriter or artist;

"CD" means compact disc;

"CEO" means Chief Executive OZcer;

"Companies Law" means the Companies (Guernsey) Law, 2008, (as amended);

"Company" means Hipgnosis Songs Fund Limited. References to the Company are also considered to be references to the Group, where applicable;

"Company Secretary" means Estera International Fund Managers (Guernsey) Limited;

"Condensed Consolidated Financial Statements" means the unaudited Xnancial statements of the Company, including the Statement of Financial Position, the Statement of Comprehensive Income, the Statement of Cash Flows, the Statement of Changes in Equity and associated notes;

"CorporateBroker" meansNplus1 SingerAdvisory LLP (N+1 Singer) and J.P.Morgan Securities plc (JPM);

"DCF" means discounted cash Yow;

"Disclosure Guidance and Transparency Rules" or "DTRs" mean the disclosure guidance published by the FCA and the transparency rules made by the FCA under section 73A of FSMA;

"Discount to Operative NAV" means the situation where the Ordinary Shares of the Company are trading at a price lower than the Company's Operative NAV;

"Downloads" means royalties for the permanent digital mechanical transfer of music;

"DSP" means Digital Service Providers;

"Earnings per Share" or "EPS" means the Earnings perOrdinary Share and is expressed in pounds Sterling;

"EU" means European Union;

"FCA" means the UK Financial Conduct Authority (or its successor bodies);

"FRC" means Financial Reporting Council;

"FSMA" means the UK Financial Services and Markets Act 2000;

"GFSC" or "Commission" means the Guernsey Financial Services Commission;

"GFSC Code" means the GFSC Finance Sector Code of Corporate Governance;

"Grammy" means an award presented by the Recording Academy to recognise achievements in the music industry;

"Group" means Hipgnosis Songs Fund Limited and its subsidiaries;

"IAS" means international accounting standards as issued by the Board of the International Accounting Standards Committee;

"IFPI" means International Federation of the Phonographic Industry;

"IFRS" means the International Financial Reporting Standards, being the principles-based accounting standards, interpretations and the framework by that name issued by the International Accounting Standards Board;

"IFRS NAV" means the value of the Gross Assets of the Company less its liabilities (including accrued but unpaid fees) in accordance with the accounting policies adopted by the Directors;

"IndependentValuer" meansMassarskyConsulting, Inc., appointed by the Board to independently value the Company's Catalogues within the Portfolio;

"Interim Report" means theCompany's half yearly report and unaudited condensed consolidated Xnancial statements for the period ended 30 September;

"Investment Adviser" means The Family (Music) Limited;

"Investment Advisory Agreement" means the investment advisory agreement dated 27 June 2018 between The Family (Music) Limited, the Company and Hipgnosis SFH I Limited;

"IPO" means the initial public oWering of shares by a private company to the public;

"ISIN" means an International Securities IdentiXcation Number;

"Listing Rules" means the listing rules made by theUK Listing Authority under section 73A FSMA;

"London Stock Exchange" or "LSE" means London Stock Exchange Plc;

"Main Market" means London's Yagship market for larger, more established companies, and is home to some of the world's largest and most well-known companies;

"MAR" means EU regulation 596/2014 on market abuse;

"MAU" means Monthly Active Users;

"Mechanical" means royalties for reproducing music, for example CD, vinyl, etc. (excluding mechanical downloads and mechanical streaming);

"NAV per Share" means the Net Asset Value attributable to the Ordinary Shares in issue divided by the number of Ordinary Shares in issue (excluding any Shares held in treasury) at the relevant time and expressed in Sterling;

"Net Asset Value" or "NAV" means the value of the assets of the Company less its liabilities as calculated in accordance with the Company's valuation policy and expressed in pounds Sterling;

"Nomination Committee" means a formal committee of the Board with deXned terms of reference;

"OKcial list" means the list maintained by the FinancialConductAuthority (acting in its capacity as the UK Listing Authority) in accordance with Section 74(1) of the Financial Services and Markets Act 2000 (the Act) for the purposes of Part VI of the Act;

"Operative NAV" means NAV as adjusted for the fair value of Catalogues of Songs;

"OrdinaryShares" means redeemable ordinary shares of no par value in the capital oftheCompany issued and designated as "Ordinary Shares" and having the rights,restrictions and entitlements set out in the Articles;

"Other income" means any income not covered by the other income types, for example sheet income and lyric exploitation;

"Performance" means royalties for playing music in public, for example TV/radio broadcasts, live performance, etc. and paid through to the publisher;

"Performance Right Organisations" or "PROs" means a performing rights organisation, such as PRS or BMI, which represents and collects performance royalties for and on behalf of each of its members;

"Portfolio" means the portfolio of Songs (whether organised intoCatalogues or otherwise) held by the Company directly or indirectly from time to time;

"PortfolioCommittee" means a committeewhich approves all purchases ofCatalogues of Songs;

"Preferred Portfolio Administrator" means the portfolio administrators appointed by the Company in orderto assistwith the administration ofthe Portfolio including Kobalt Music Services Limited, the Company's preferred portfolio administrator;

"Premium Listing" means the Premium Listing Segment of the London Stock Exchange;

"Premium to Operative NAV" means the situation where the Ordinary Shares of the Company are trading at a price higher than the Company's Operative NAV;

"Prospectus" means the prospectus issued by the Company on 27 June 2018, and as amended and restated on 27 September 2019;

"PRS" means Performing Rights Society;

"RCIS Rules" means the Registered Collective Investment Scheme Rules 2018;

"Recording Academy" means a U.S. academy of musicians, producers, recording engineers and other musical professionals;

"Registrar" means Computershare Investor Services (Guernsey) Limited;

"Remuneration Committee" means a formal committee of the Board with deXned terms of reference;

"Revolving Credit Facility" means a line of creditthatis arranged between a bank and a business. It has an established maximum amount, where the business has access to the funds at any time when needed;

"SFS" means London Stock Exchange's specialist fund segment of the main market for listed securities;

"Shareholder" means the holder of one or more Ordinary Shares;

"Song" means a songwriter's and/or publisher's share of copyright interest in a song, being a musical composition ofwords and/or music and the songwriter's proportion ofthe publishing rights of a single musical track, and when construction permits, the collection of words and/or music as purchased by consumers;

"Streaming" means performance and mechanical royalties for digitally playing music in real-time, for example through Spotify;

"Synchronisation" means royalties for playing music in connectionwith visual media (for example Xlm, TV, advertisements);

"TV" means television;

"UK" or "United Kingdom" means the United Kingdom of Great Britain and Northern Ireland;

"U.S." or "United States" means theUnited States ofAmerica, its territories and possessions, any state of the United States and the District of Columbia;

"Writer's Share" means performance royalties collected by a Performance Rights Organisation and paid through directly to the songwriter as opposed to the publisher share of performance;

"YouTube" means the U.S. video-sharing website;

"£" or "Pounds Sterling" or "Sterling" means British pound sterling and "pence" means British pence;

"\$" or "USD" means United States dollars and "cents" means United States cents.

Directors and General Information

Board of Directors

Andrew Sutch (Chairman) Paul Burger (Senior Independent Director from 9 September 2019) Andrew Wilkinson Simon Holden Sylvia Coleman (appointed 21 November)

Audit and Risk Management Committee

Andrew Wilkinson (Chairman) Paul Burger Sylvia Coleman (appointed 21November) Simon Holden Andrew Sutch

Portfolio Committee

Paul Burger (Chairman) Sylvia Coleman (appointed 21 November) Simon Holden Andrew Sutch Andrew Wilkinson

Asset Management Committee

Andrew Sutch (Chairman) Paul Burger Sylvia Coleman (appointed 21 November) Simon Holden Andrew Wilkinson

Nomination Committee (established 9 September 2019)

Paul Burger (Chairman) Sylvia Coleman (appointed 21 November) Simon Holden Andrew Sutch Andrew Wilkinson

Remuneration Committee (established 9 September 2019)

Simon Holden (Chairman) Paul Burger Sylvia Coleman (appointed 21 November) Andrew Sutch Andrew Wilkinson

Advisory Board

Nile Rodgers The-Dream Giorgio Tuinfort Starrah Nick Jarjour David Stewart Bill Leibowitz Ian Montone Jason Flom

Registered OKce

E&ective from 29 April 2019 Floor 2 PO Box 286 Trafalgar Court Les Banques St Peter Port Guernsey GY1 4LY

Priorto 29 April 2019 Heritage Hall PO Box 225 Le Marchant Street St Peter Port Guernsey GY1 4HY

Directors and General Information continued

Investment Adviser

The Family (Music) Limited 4th Floor East Wing Chancery House 53-64 Chancery Lane London WC2A 1QS www.hipgnosissongs.com

Administrator and Company Secretary

E&ective from 29 April 2019 Estera International Fund Managers (Guernsey) Limited Floor 2 PO Box 286 Trafalgar Court Les Banques St Peter Port Guernsey GY1 4LY

Priorto 29 April 2019 Estera International Fund Managers (Guernsey) Limited Heritage Hall PO Box 225 Le Marchant Street St Peter Port Guernsey GY1 4HY

Registrar

Computershare Investor Services (Guernsey) Limited 1st Floor Tudor House Le Bordage St Peter Port Guernsey GY1 1DB

Corporate Brokers

N+1 Singer Advisory LLP 1 Bartholomew Lane London EC2N 2AX

J.P. Morgan Securities plc (Appointed 10 September 2019) 25 Bank Street, Canary Wharf London E14 5JP

Independent Auditor

PricewaterhouseCoopers Cl LLP Royal Bank Place 1 Glategny Esplanade St Peter Port Guernsey GY1 4ND

Music Specialist Legal Counsel

CTABL Inc. 9460 Sunrise Lakes Boulevard Suite 302 Sunrise Florida 33322 USA

Legal Advisers to the Company

Herbert Smith Freehills LLP Exchange House Primrose Street London EC2A 2EG

Legal Advisers to the Company as to

Guernsey Law Ogier (Guernsey) LLP Redwood House St Julian's Avenue St Peter Port Guernsey GY1 1WA

Directors and General Information continued

Principal Banker

Barclays Bank PO Box 41 Le Marchant House St Peter Port Guernsey GY1 3BE

Preferred Portfolio Administrator

Kobalt Music Services Limited The River Building 1 Cousin Lane London EC4R 3TE

IdentiJers

ISIN: GG00BFYT9H72 Ticker: SONG SEDOL: BFYT9H7 Website: www.hipgnosissongs.com LEI: 213800XJIPNDVKXMOC11 GIIN: 5XGPC8.99999.SL.831

Managing your account online

TheCompany's registrar,Computershare Investor Services (Guernsey) Limited, allows you to manage your shareholding online. If you are a directinvestor you can viewyour shareholding, change theway the registrar communicateswith you and buy and sell shares. If you haven't used this service before, all you need to do is enterthe name oftheCompany and register your account at https://www-uk.computershare.com/investor. You'll need yourInvestor code (IVC) printed on your share certiXcate in orderto register.

Advice to Shareholders

In recent years investment related scams have become increasingly sophisticated and diZcult to spot. We are therefore warning all our Shareholders to be cautious so that they can protect themselves and spot the warning signs.

Fraudsters will often:

• contact you out of the blue
• apply pressure to invest quickly
• downplay the risks to your money
• promise tempting returns that sound too good to be true
• say that they are only making the oWer available to you
• ask you to not tell anyone else about it

You can avoid investment scams by:

• Rejecting unexpected oIers Scammers usually cold call but contact can also come by email, post,word of mouth or at a seminar. If you have been oWered an investment out ofthe blue, chances are it's a high risk investment or a scam.
• Checking the FCA Warning List Use the FCA Warning List to check the risks of a potential investment. You can also search to see if the Xrm is known to be operating without proper FCA authorisation.
• Getting impartial advice Before investing getimpartial advice and don't use an adviserfrom the Xrm that contacted you. If you are suspicious, report it
• You can report the Xrm or scam to the FCA by contacting their Consumer Helpline on 0800 111 6768 or using their online reporting form.
  • If you have lost money in a scam, contact Action Fraud on 0300 123 2040 or www.actionfraud.police.uk.

For further helpful information about investment scams and how to avoid them please visit www.fca.org.uk/scamsmart.

Cautionary Statement

TheChairman's Statement and the InvestmentAdviser'sReport have been prepared solely to provide additional information for shareholders to assess the Company's strategies and the potential forthose strategies to succeed. These should not be relied on by any other party or for any other purpose.

The Chairman's Statement and Investment Adviser's Report may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identiXed by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology.

These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this document and include statements regarding the intentions, beliefs or current expectations of the Directors and the Investment Adviser, concerning, amongst otherthings,the investment objectives and investment policy, Xnancing strategies, investment performance, results of operations, Xnancial condition, liquidity, prospects, and distribution policy of the Company and the markets in which it invests.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance.

The Company's actual investment performance, results of operations, Xnancial condition, liquidity, distribution policy and the development ofits Xnancing strategies may diWer materially from the impression created by the forward-looking statements contained in this document.

Subject to their legal and regulatory obligations, the Directors and the Investment Adviser expressly disclaim any obligations to update or revise any forward-looking statement contained herein to reYect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based.

Hipgnosis Songs Fund Limited

Floor 2, PO Box 286 Trafalgar Court, Les Banques, St Peter Port Guernsey GY1 4LY

Further information available online: www.hipgnosissongs.com