Final Results

Lindsell Train Investment Trust PLC
30 May 2003



Objective of the Company


The objective of the Company is to maximise long-term total returns subject to the avoidance of loss of absolute value
with a minimum objective to maintain the real purchasing power of sterling capital, as measured by the annual average
yield on the 2.5% Consolidated Loan Stock.


Highlights for the year


Performance comparisons 1 April 2002 - 31 March 2003

Middle market share price per ordinary share                                                                     -21.4%
Net Asset Value per ordinary share U                                                                             -13.2%
Benchmark*                                                                                                        +4.9%
MSCI World Index (sterling)                                                                                      -32.8%
UK RPI Inflation                                                                                                  +3.1%

* The index of the annual average yield on the 2.5% Consolidated Loan Stock between the relevant dates
U Adjusted to include the payment of the dividend


Chairman's Statement

The share price of your Company fell in value by 21.4% over the year to 31 March 2003. This compared to a fall in the
net asset value (NAV) adjusted to include for the payment of the dividend of 13.2% and a rise in the benchmark of 4.9%.
From this perspective the performance of the Company was disappointing. On the other hand a 10.4% decline in the NAV
since inception compares well against the 43.6% decline in world markets (as measured by the MSCI World Index in
sterling).


The most concerning aspect of the performance over the year was the fall in the NAV, which unlike the share price is
under the Manager's direct control. The main cause lay in the performance of five media companies that accounted for
£2,381,000 (or 86%) of the loss of value over the year. These were, in order of the magnitude of their loss to the
Company, Reuters, Wolters Kluwer, Dow Jones, Nintendo and Instinet. It is clear, with the benefit of hindsight, that
the commitment the Company made to these businesses was too hasty in the aftermath of the inflation in their share
prices, which occurred in the late 1990's. Unlike many technology companies, that were priced at extreme multiples of
earnings and had business models heavily reliant on outside capital, the Manager thought that these companies were
attractively priced relative to their potential and in all cases were able to generate the capital necessary to grow
from their internal resources. Although the latter attribute has been reinforced by dividend increases and share
repurchases from four of the five companies with the exception of Reuters, it proved to be of little help as these
share prices were punished just as harshly as some of the mainline technology companies. Despite this harrowing
near-term experience, shareholders should expect the Company's commitment to Media to persevere and possibly grow.


The other main cause of the fall in NAV was the loss the Company experienced from its exposure to US dollar assets.
Over 50% of the Company's assets were denominated in US dollars throughout the year. The US dollar fell in value versus
sterling by 13%. As a result a further £1,338,039 (or 48%) of the loss of value was accounted for by this currency move
alone. The Manager retains its expectation for a reversal of this trend.


The Manager did better with the remainder of the portfolio that in aggregate reduced the loss of value over the year by
£945,221 (or 34%). Most of the fixed interest generated returns in excess of 20% and some equities such as AG Barr and
Glemorangie delivered positive returns in what proved to be an awful year for the market as a whole.


The value of the holding in Lindsell Train Limited fell during the second half of the year but ended it hardly changed
at £584,000 representing 3.3% of NAV at 31 March 2003. Funds under management fell to £96m from £102m last year. This
was largely attributable to the fall in the share price of the Finsbury Growth Trust, which nevertheless continued to
outperform its index and remained at the top of its peer group. External clients assets in the two Lindsell Train Long
& Short Funds amounted to £26m up £7m from last year. Although declining funds under management had a negative impact
on the valuation of Lindsell Train Limited, rising book value and rising profitability had an offsetting positive
impact. Although Lindsell Train Limited was appointed as a sub-manager for the Aon UK Equity Fund they were not funded
until April 2003 so no contribution to the share price calculation is included in the 31 March share price. Lindsell
Train Limited paid two inaugural dividends to its shareholders in respect of its second financial year ended 31 January
2003. They totalled £40 per share. This compared to the cost of the initial investment in Lindsell Train Limited of
£100 per share made in January 2001 and represents a historic yield of 4.6% on its value at 31 March 2003.


The Company retained its investments in the two Lindsell Train Funds, The Lindsell Train Japan Fund and the Lindsell
Train Global Media Fund, over the year. Both Funds declined in value, the Japan Fund by 1.8% and the Media Fund by
10.5%. As these were 'absolute return' orientated Funds the performance was disappointing, especially so for the Media
Fund. Unfortunately the Fund suffered from the same malaise as the Company's direct media investments although its
short positions helped to mitigate the losses. The Japan Fund failed to maintain its upward momentum of 2001 but at
least preserved most of its gains while investing in a market that fell 16.3% in US dollars terms.


The Company increased its borrowings during the year from 10.3% of net assets to 15.3%. The Company's average cost of
funds during the year was 4.8%. Most additional assets were purchased at a yield premium to this cost of funds, to add
to approximately half of the assets that already yielded more.


The costs incurred running the Company were markedly less than they were in the last financial period. They totalled
£275,000 and included no performance fee payments. All expenses have been charged to the income account. Falling
expenses are the main reason for the rise in net profits to £366,000. The Directors have a stated policy to retain as
much of this profit as necessary without jeopardising the Company's investment trust status. Accordingly the Directors
propose a dividend in respect of the financial year to 31 March 2003 of £1.30 per share.


In the two and quarter years since the inception of the Company the Manager has pursued a clear and well articulated
strategy built around a large investment in long term fixed interest and a developing commitment to a select group of
cash generative companies. It has proved relatively successful in preserving value for shareholders at an unusually
difficult time for investors in equities and retains the flexibility to benefit from change as it occurs in the future.

R M Swire
Chairman
29 May 2003


Investment Manager's Report

At the Company's Annual General Meeting last year we recall one or two shareholders expressing disappointment at the
assets we chose to highlight as the best investment ideas we had at the time. Those assets were the two HBOS preference
shares that we had been accumulating and have continued to accumulate, with the ordinary shares too, up to the maximum
permitted by the UK investment trust taxation legislation. Our shareholders felt that these preference shares were
rather dull and detracted from the real business of the Company, to identify money-making opportunities in ordinary
shares.


In truth we agreed with these comments. It was a source of disappointment and concern to us that we were unable to
identify many shares where prospects or under valuation promised a near-term return that could match the c. 7.0% net
yield offered by the HBOS paper. In hindsight, though, we wish we could have committed even more of the Company to
them, because, as this report is written, the preference shares have made a modest gain in value over the year, as well
as delivering their dividend, while all too many of our other strategic ideas, or stock commitments, failed to deliver,
or registered unpalatable book losses.


As the Chairman's statement makes clear, the last year was marked by various disappointments. We hoped that Anglo-Saxon
government bond yields would decline significantly, generating capital gains for the Company. Government bond prices
did go up over the past 12 months, by low double-digit percents in local currencies, for the US and UK paper we own.
However, given how awful the equity markets were over the period, we expected more. We looked for the US Dollar to
prove resilient against Sterling and for a bear market to become apparent for the latter, as UK economic and fiscal
performance deteriorated. Indeed, the Dollar has rallied in 2003 and Chancellor Brown's sums are coming under intense
scrutiny, but there is no bear trend in the Pound that any speculator would acknowledge. Our commitment to various
media content owners or creators has been discussed above. We must note, though, that it was not so much the
performance of the equity market proxies we own, Reuters, Instinet and Dow Jones that dismayed us, but the attrition in
the two stocks in this sector that we thought we had cleverly identified as counter-cyclical - Nintendo and Wolters
Kluwer. It is true that both companies somewhat under performed our expectations as businesses in 2002/3, but the
levels to which the shares fell frankly amazed us. At its low Wolters traded on a historic P/E of 7.0x and a yield of
6.0% (it has subsequently rallied 35.0% and paid that dividend), while Nintendo's market capitalisation fell to a level
where it was 70.0% accounted for by its net cash. Finally, we take comfort from the relative resilience of the consumer
branded goods franchises we own and believe that in A.G. Barr and Glenmorangie we own not only exceptional corporate
assets, but exceptionally undervalued assets to boot. Even here though, we had a bitter pill to swallow, akin to
washing down a Creme Egg whole with a quart of Dr Pepper. This was the de-rating of our then largest equity position,
Cadbury (maker of the fine products of the previous sentence). The shares fell from a high of £5.00 to a fraction above
£3.00, as investors responded cautiously to its acquisition of US chewing-gum manufacturer, Adams. Although
understandable, this hit to Cadbury stock was perhaps the most unlooked for and frustrating of all for us.


We dwell on these errors of timing or analysis partly in the interests of candour with our shareholders, but also
because we want to alert them to the fact that little has changed in our strategic thinking, nor in our liking for
individual stocks. The same themes inform the portfolio today as last year and the same stocks populate it, in some
cases added to. There were remarkably few trades during the Company's last financial year, just 13.5% of portfolio
value and we paid only £2,600 in brokerage commissions. This inactivity reflects our style, our dislike of transaction
costs, but also, for better or worse, our enthusiasm for existing ideas.


To expound on a few, we cannot believe that the rapid rise in US unemployment and the now accepted end of the housing
boom in the UK mean anything but diminishing consumer confidence and scope for further interest rate declines, at both
ends of the yield curve and on both sides of the Atlantic. We definitely think that the owner of a speculative
'buy-to-let' apartment in London Docklands should feel in a more vulnerable position, for both prospective income and
capital, than the owner of the 2.5% Consolidated Loan Stock, like us.


The absolute gains delivered by NASDAQ in 2003, accompanied by rallies in shares of other technology and software
shares around the world are, perhaps, not yet sustained or spectacular enough to amount to a trend. Nonetheless, they
are in some ways an unwelcome reminder for many investors, including us, that the next equity bull market will almost
certainly involve companies finding profitable ways to exploit the potential opened up by the technology boom of the
last century. For us, at the very least, we hope that this rally means that our media positions will not inflict any
further damage on the Company in the coming year. All of our investments here are substantive companies and each has a
strategy to enhance its products or service using technology. We find it easy to conceive of any of these holdings
doubling from current levels, but perhaps it is Nintendo that we believe has the greatest potential. Investors are
fixated on the company's struggle to propagate its Gamecube console, in the face of Sony's entrenched position and
Microsoft's willingness to subsidise XBOX to losses, which would embarrass a weaker balance sheet. Meanwhile, Nintendo
has not only sold a short 10 million Gamecubes in little over a year, behind target, but a respectable installed base,
it has strengthened its hold on the handheld gaming market with its Gameboy Advance, which now has a global population
of 34 million and looks set to double again over the next 18 months. Finally, the company remains top games publisher
in Japan and should reclaim that position in the US in 2003 and software is where the industry really makes its money.
Nintendo is not a failure as a business, but the share price says it is.


So far as 'defensive' consumer staples, food and drinks companies, are concerned, we expect this class in general to
disappoint investors in business and share price terms. The tough environment for volumes and pricing of branded goods
is not about to ameliorate. This is why we remain optimistic about Barr and Glenmorangie, where the volume opportunity
for their brands is demonstrated in each recent set of results. Here is why we also support Cadbury's management in
taking the risk to leverage its balance sheet to acquire Adams. We expect Cadbury's growth to accelerate as a result of
the transaction. We also applaud the method of financing - debt. In the end, the cash generation from Cadbury's old
business, plus the cash flows from Adams will pay down this debt, with high predictability and shareholders will be
left with a more profitable and valuable company, supported by the same number of ordinary shares, which will then
likely be much higher priced.


Conclusion


We have for some time recognised that the major strategic challenge facing us is when to shift the Company's
bond-oriented portfolio to an equity dominated one. We do not judge that the time is yet, but have made modest moves in
that direction. In 2003 we sold a portion of the US Treasury Inflation Protected Securities ('TIPS'), which had done so
well for us, on achievement of a preliminary real yield target. We invested the proceeds into existing equity holdings
and commenced a position, not yet completed, into Diageo, paying just over £6.00 per share to access a dividend yield
of 3.9%, supported by the cash flows of the world's largest spirits business. We believe the intrinsic value of Diageo
approaches £10.00 per share and will use any further weakness to add to the stock. The switch into Diageo is income
enhancing for shareholders, as we exchange a gross paying bond for a net paying equity, with a higher yield , but we
sacrifice the certainty of return offered by the TIP with reluctance. Where we can access higher levels of income than
on current assets, with no material loss of security, we will. Indeed, this effort dominates our current investment
thinking.

In sum, we find it hard to demur from what may now be consensual thinking that equities as a class will struggle to
return much more than 5-7% pa in total, as long as inflation runs at 2.5% or less. This is why, to return to the
beginning, we still find our HBOS preference shares so attractive, still yielding more than that c. 6.0% return from
equities, but with lower risk. If their yields were to decline to 4.0-5.0%, as we think possible, then these
instruments will turn out to be very exciting indeed, for a period.


We hope shareholders are more satisfied with this account of our efforts on their behalf than we are with the results,
but share our view that the portfolio has the potential to deliver satisfactory returns from here.

N Train
Investment Manager
Lindsell Train Limited
29 May 2003



The Lindsell Train Investment Trust plc


Statement of Total Return incorporating the revenue account for the year ended 31 March 2003

                                                            2003                                 2002 +
                                              Revenue*     Capital       Total    Revenue*     Capital          Total
                                                 £'000       £'000       £'000       £'000       £'000          £'000

(Losses)/gains on investments                        -     (3,151)     (3,151)           -         727            727
Exchange differences                                 -           3           3           -          64             64
Gains on forward currency contracts                  -           9           9           -         112            112
Income                                             731           -         731         882           -            882
Investment management fees                        (82)           -        (82)       (425)           -          (425)
Other expenses                                   (146)         (1)       (147)       (383)         (5)          (388)

Net return/(deficit) before
finance costs and taxation                         503     (3,140)     (2,637)          74         898            972

Interest payable and similar
and similar charges                              (128)           -       (128)        (20)           -           (20)

Return/(deficit) on ordinary
activities before tax                              375     (3,140)     (2,765)          54         898            952

Tax on ordinary activities                         (9)           -         (9)         (4)           -            (4)

Return/(deficit) on ordinary activities
after tax for the financial year                   366     (3,140)     (2,774)          50         898            948

Dividends in respect of
equity shares                                    (260)           -       (260)           -           -              -

Transfer to/(from) reserves                        106     (3,140)     (3,034)          50         898            948

Return/(loss) per Ordinary Share:                £1.83    £(15.70)    £(13.87)       £0.25       £4.49          £4.74


All revenue and capital items in the above statement derive from continuing operations.
* The revenue account in this statement represents the profit and loss account of the Company for the

financial year.
+ For the period 22 January 2001 to 31 March 2002.


Balance Sheet as at 31 March 2003
                                                                                 2003                              2002
                                                                                £'000                             £'000
Fixed assets
Investments                                                                    20,661                            23,104
Current assets
Debtors                                                                         1,295                             1,093
Cash at bank                                                                       11                                53
                                                                                1,306                             1,146
Creditors: amounts falling due within one year                                (4,053)                           (3,302)

Net current liabilities                                                       (2,747)                           (2,156)

Total assets less current liabilities                                          17,914                            20,948

Capital and reserves
Called up share capital                                                           150                                50
Share premium                                                                       -                            19,950
Special reserve                                                                19,850                                 -
                                                                               20,000                            20,000
Capital reserve - realised                                                        211                               156
Capital reserve - unrealised                                                  (2,453)                               742
Revenue reserve                                                                   156                                50
Equity shareholders' funds                                                     17,914                            20,948
Net asset value per Ordinary Share:                                            £89.57                           £104.74


Cash Flow Statement for the year ended 31 March 2003
                                                                                        2003                     2002 +
                                                                                       £'000                      £'000
Net cash inflow from operating activities                                                456                        127
Returns on investments and servicing of finance                                        (126)                       (11)
Financial investment                                                                   (678)                   (22,274)
                                                                                       (348)                   (22,158)
Equity dividends paid                                                                      -                          -
                                                                                       (348)                   (22,158)
Financing                                                                                  -                     19,783
Decrease in cash                                                                       (348)                    (2,375)
Reconciliation of net cash flow to movement in net debt
Decrease in cash in the year                                                           (348)                    (2,375)
Exchange movements                                                                         3                         64
Opening net debt                                                                     (2,311)                          -
Closing net debt                                                                     (2,656)                    (2,311)
+ For the period 22 January 2001 to 31 March 2002.
Reconciliation of movements in shareholders' funds

                                                                                                                  2003
                                                                                                                 £'000

Opening shareholders' funds                                                                                     20,948
Net revenue for the year                                                                                           366
Dividend                                                                                                         (260)
Capital deficit for the year                                                                                   (3,140)
Closing shareholders' funds                                                                                     17,914


Notes

The statutory accounts for the year ended 31 March 2003 will be finalised on the basis of the financial information
presented by the Directors in this preliminary announcement and will be delivered to the Register of Companies
following the Company's Annual General Meeting. Copies will be sent to shareholders shortly and will also be available
for collection from the Company's Registered Office at 77a High Street, Brentwood, Essex CM14 4RR.


The above results at 31 March 2002 are an abridged version of the Company's full accounts which received an audit
report that was unqualified and did not contain statements under Section 237(2) or (3) of the Companies Act 1985 and
which have been filed with the Registrar of Companies.


The net asset value per Ordinary Share is based on net assets of £17,914,000 (2002: £20,948,000) and on 200,000
Ordinary Shares (2002: 200,000),being the number of Ordinary Shares in issue at the year end.
Return per Ordinary Share:

Revenue Return:

The calculation of the Revenue Return per Ordinary Share is based on net revenue on ordinary activities after taxation
of £366,000 (2002: £50,000) divided by 200,000 Ordinary Shares (2002: 200,000) being the weighted average number of
Ordinary Shares in issue during the year.


Capital Return:

The calculation of the Capital Return per Ordinary Share is based on net capital losses for the financial year of £
(3,140,000) (2002: profit £898,000) divided by 200,000 Ordinary Shares (2002: 200,000) being the weighted average
number of Ordinary Shares in issue during the year.

It is the intention of the Directors to conduct the affairs of the Company so that it satisfies the conditions for
approval as an investment trust company set out in Section 842 of the Income and Corporation Taxes Act 1988.
The Directors have proposed the payment of a final dividend of 130p (2002: Nil) per Ordinary Share payable on 15 July
2003 to shareholders registered on 13 June 2003 (ex-dividend 11 June 2003).


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