Monthly update

Lindsell Train Investment Trust PLC
23 June 2006


                                        The Lindsell Train Investment Trust PLC
                                                   As at 31 May 2006
Fund Objective
To maximise long-term total returns subject to the avoidance of loss of absolute value and 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.

Net Asset Value                                                       GBP 132.70
Share Price                                                           GBP 130.50
Premium (Discount)                                                        (1.6%)
Market Capitalisation                                                 GBP 26.1mn
Benchmark (21/2% Con Ann Avg Yield +4.4%)                                   +0.4
Source: Bloomberg; NAV-Lindsell Train. Share Price
quoted is closing mid price. See Benchmark definition.

Performance History (based in         2001     2002       2003        2004            2005              YTD 2006
GBP)
Net Asset Value TR%                   +3.2     -9.6       +3.1        +23.7           +16.5               -1.2
Share Price TR%                       +18.5    -19.8      -8.7        +20.6           +27.5               +2.9
Source: LTL and S&P Micropal. Performance years listed Jan - Dec. Launch date 22 Jan 2001. TR=Total Return (with
dividends reinvested) *Source: Lindsell Train Ltd. Past performance is not a guide to future performance. The price of
units and the income from them may go down as well as up. Investors may not get back what they invested.


2005 Performance      Jan   Feb   Mar   Apr   May   Jun   Jul   Aug     Sep       Oct           Nov            Dec
Net Asset Value TR%  +1.4  +0.3  +1.7  +0.2  +3.4  +2.9  +0.0   +0.2    +1.0      -1.5         +2.3*          +2.9
Share Price TR%      +8.6  +3.5  -3.4  +1.8  +2.6  +9.3  +0.4   -2.3    +2.4      -3.9         +1.2           +4.0
Source: LTL and S&P Micropal unless otherwise indicated. Performance years listed Jan - Dec. Launch date 22 Jan 2001.
TR=Total Return (with dividends reinvested) *Source: Lindsell Train Ltd.


2006 Performance      Jan   Feb   Mar   Apr   May  Jun  Jul   Aug      Sep        Oct          Nov            Dec
Net Asset Value TR%  +0.9  +1.9  +1.2  -1.8  -2.0
Share Price TR%      -3.0  +7.5  +1.5  +3.4  -1.5
Source: LTL and S&P Micropal unless otherwise indicated. Performance years listed Jan - Dec. Launch date 22 Jan 2001.
TR=Total Return (with dividends reinvested) *Source: Lindsell Train Ltd.

Past performance is not a guide to future performance. The price of units and the income from them may go down as well
as up. Investors may not get back what they invested.


Industry Breakdown                                             % of NAV
Bonds                                                            20.1
Preference Shares                                                14.1
Equity - Media                                                   12.0
Equity - Banks & Investment Co.                                  6.7
Equity - Leisure & Ent.                                          11.5
Equity - Food & Beverage                                         27.7
Equity - Consumer Goods                                          1.6
Investment Fund                                                  20.5
Cash & Equivalent                                               (14.2)
Total                                                           100.0
Source: Lindsell Train


Top 10 Holdings                                                % of NAV
HBOS 9.25% Non Cum                                               10.9
Lindsell Train Global Media (Dist)                               10.9
Barr AG                                                          10.0
Diageo                                                            7.7
Cadbury Schweppes                                                 7.5
US Gov Treasury 6.25%                                             7.4
21/2% Consolidated Loan Stock                                     7.3
Lindsell Train Ltd                                                6.7
Wolverhampton & Dudley Breweries                                  5.6
Nintendo                                                          5.4
Source: Lindsell Train


Fund Exposure         Bonds      Prefs        Equity          Funds              Cash                 % of NAV
UK %                   12.7      14.1          48.6            4.4              (14.3)                  65.5
USA %                  7.4         -            1.3             -                5.4                    14.1
Europe (ex UK) %        -          -            4.2             -               (2.6)                    1.6
Japan %                 -          -            5.4            5.2              (2.7)                    7.9
Global %                -          -             -             10.9               -                     10.9
Total                  20.1      14.1          59.5            20.5             (14.2)                  100.0
Source: Lindsell
Train


Fund Manager's Comments

The story goes that sometime in the early years of the Twentieth Century there was a lull on the trading floor of the
New York Stock Exchange, a lull that extended from hours into days - and the boys were getting bored and restless. Come
an afternoon, for want of any better entertainment, one of the traders pulled out an elderly sardine tin and announced
his willingness to sell this unique item for no more than a nickel. In a moment two jobbers from the Railroads pitch
had bid and counter-bid for the tin, pushing the price up to a dime. Not to be outdone, the swells who trade Texas oil
stocks jump in, doubling the price of the sardines, then doubling it again. The tin passes from professional hand to
professional hand, with the ticket sometimes a cent or two higher, sometimes up a quarter. At last the hubbub attracts
the attention of the baby of the floor, a wet behind the ears college kid. He spots the unusual label and can't miss
the excitement in the open outcry yelling of the traders. The kid, determined to show he can play with the big boys and
genuinely intrigued by the apparent rarity of the item, firmly calls out 'Ten bucks' and is delighted when the bidding
comes to an abrupt end. Hefting out his pocket-knife, he punctures the tin, only to be met with the unmistakeable stink
of rotting fish. Bewildered and heavily out of pocket, the new boy turns to one of his elders and betters, who had
taken a half Dollar turn out of the tin an hour previously. 'I don't get it' says the kid, 'these sardines are long
gone.' 'Son', says the old jobber, 'those weren't eating sardines, thems were trading sardines.'

We're fond of this apocryphal story, which illustrates one aspect of the workings of capital markets. We all know about
the ramped 'concept' stock, the speculative issue that almost unaccountably captures the attention of traders and the
investing public. This is the kind of stock whose appeal begins and ends with the prospect that it might go up a lot in
a short period of time. Sometimes an entire subsector of the market is implicated, or even created, in the excitement.
If you play the game and, we must admit, we tend not to play this type of game, then one important thing is to not be
the patsy who pays top Dollar. The other consideration is knowing, if and when the music stops, whether you hold
trading or eating sardines. There were many months after March 2000 and many rallies, when it was possible to sell out
of various Internet 'trading' sardines, not at the top, assuredly, but before the things reverted to penny stock
status. Equally, there were some 'eating' sardines too. Sage was always more wholesome than QXL Ricardo and while its
decline from £8.00 to £1.05 was disagreeable, to say the least, there was the comfort of actual revenues and dividends,
unlike many others.

The tale is also salutary as a reminder of how all capital market activity is driven by speculation, to a greater or
lesser extent. There is a raw gambling instinct at work, not so deep beneath most investment decisions and necessarily
so, given our always imperfect knowledge of the future. For instance, we were intrigued to read John Ralfe's recent
comments about the University Superannuation Scheme's current asset allocation for its £22.0 billion fund. Ralfe was
the architect of the Boots' pension plan's famous switch into fixed interest assets and has argued publicly that the
USS is imprudently exposed to equities. The scheme has 80.0% in stocks, compared to the industry average c65.0% and a
deficit of c£3.5 billion. From Ralfe's perspective that makes its pensioners dangerously exposed to any further
declines in the equity market. The scheme's officers argue the opposite - that the long tail of its liabilities means
that above average equity risk and the excess returns to be expected for taking that risk are appropriate and
desirable. Both positions are plausible, both based on sophisticated analysis of past returns, volatility and liability
benchmarking. Either position, though, could turn out horribly wrong. In the end, the USS' extra £3.3 billion of equity
exposure, compared to industry average, is an animal-spirited punt - the stakes are high and the outcome uncertain.

Of course, the most topical and urgent question that arises from our fishy tale, is whether a similar rise and fall may
be unfolding in the commodity markets and associated more or less speculative equity instruments. We are not experts on
commodity cycles, so will not hazard a definitive view as to whether a bubble is inflating or, as it is possible to
argue, has already burst. It has to be said, though, that the behaviour of the copper price in 2006 would not disgrace
the final stages of a speculative blow-out. The metal has quadrupled since 2001, but more to the point, with a perfect
NASDAQ 1999-2000-style exponential curve, the last doubling in price, from 193 on the CRB future to 392, was achieved
in little over four months, from Jan 1st 2006, to May 11th. At this point, you may remember, it was reported that the
melted down value of a Sterling two penny piece would now be 3p - a symbolic but probably spurious indicator of excess.
A more relevant sign of the possible overvaluation of the metal can be seen though, in BHP's acknowledgement that the
run-up in copper has lead to accelerating substitution in plumbing products - from copper to plastics - and that these
represent c10-12.0% of global usage. Consumers may never smelt their loose change, but they will respond rationally to
price hikes, in ways that can ultimately undermine the economics of the commodity producer.

The subsequent correction in the CRB copper future led to a 12.0% drop, since narrowed to less than 5.0% by end May.
You don't need to be a chartist to know that the next substantive move, down, or up to new highs, will be significant
for sentiment and the pricing of a whole slew of dependent equities. NASDAQ suffered plenty of corrections during its
long bull market, but when the real break finally came, it fell 72.0% from its peak and is still less than half its
2000 levels. Meanwhile, while we have nothing of value to assert individually about companies such as Kazakhyms,
Vedanta or Xstrata, just to cite some of the heaviest UK capitalisations in the territory, it is hard to believe that
there aren't some decomposing sardines amongst them. Even the eating sardines look challengingly priced. Both BHP and
RTZ trade for getting on 4.0x 2005's revenues. Admittedly those revenues are currently super profitable and likely to
grow smartly for the foreseeable future, but at some stage the likelihood is that one will be able to access the equity
of these companies, at some low ebb in commodity prices and during a period of heavy capital expenditure, on more like
1.0x EV/Revenues.

We continue to believe in the thematic underpinning of the commodity price boom. That underpinning is not, we think,
that coal or copper is in fundamentally short supply - these are not rare commodities. The boom is actually an
expression of the unexpected and sustained growth in developing economies. We choose to participate in this theme via
the equity of consumer branded goods businesses, which we expect to benefit from a prolonged period of rising
disposable incomes in those parts. This is because, over the piece, we expect such brand-owning companies to earn
higher cash returns on capital committed to developing economies, than more cyclical, capital-intensive commodity
extractors. We also believe that the equity of our favoured companies is undervalued, as investor attention has fixated
on mineral assets. For instance, we note and applaud Cadbury Schweppes recent acquisition of Dan Products, a South
African chewing gum business. Cadbury paid c3.75x Dan's annual revenues for the company. If we apply a similar EV/
Revenue multiple to the 30.0% or more of Cadbury's group sales that derive from the developing economies, then we find
that the remainder of the company is valued on less than 1.3x. This seems exceptionally modest to us and similar
analysis can be performed on other holdings in Diageo, Clarins and Heineken.

Your NAV declined in May, but at a more modest rate than that of global equity markets. This is consistent with past
performance of the Company, which has tended to outperform falling stock markets and underperform rising. Longer term
performance from inception still comfortably exceeds the return on global equities.


Fund Manager                            Launch Date                             Denomination
Nick Train                              22 Jan 2001                             GBP
Year End                                Dividend                                Benchmark
31st Mar                                Ex Date: June                           The annual average yield on the 21/2%
                                        Payment: August                         Consolidated Loan Stock.
The Board                               Management Fees                         Registered Address
Rhoddy Swire                            Standard Fee: 0.65%                     Lindsell Train Investment Trust
Michael Mackenzie                       Performance Fee: 10% of annual increase Springfield Lodge, Colchester Road
Donald Adamson                          in the share price, plus dividend,      Chelmsford
                                        above the gross annual yield of the 2   ESSEX  CM2 5PW
Dominic Caldecott                       1/2% Consolidated Loan Stock.
ISIN                                    Secretary                               Listing
GB0031977944                            Phoenix Administration Services Limited London Stock Exchange
Bloomberg
LTI LN

Disclaimer
This document is intended for use by persons who are authorised by the UK Financial Services Authority ('FSA') and
those who are permitted to receive such information in the UK. The information contained in this document does not
constitute an offer or invitation to buy or sell any investments. Nothing in this document constitutes investment,
legal, tax or other advice. Lindsell Train and/or persons connected with it may have an interest in this investment.
The value of any investment in securities or funds and the income generated from them may go down as well as up and are
not guaranteed. Past performance cannot be used as a guide or guarantee of future performance. You may not get back the
original amount you have invested. Changes in foreign exchange rates may cause the value of your investment to go up or
down. Some funds with higher gearing may be subject to higher volatility and the investment value may change
substantially. The net asset value (NAV) performance of an investment trust is not the same as its market share price
performance.

Issued by Lindsell Train Limited
Authorised and regulated by the Financial Services Authority
21 Jun 2006 LTL 000-037-1b

                                                Lindsell Train Limited
                                          35 Thurloe Street, London  SW7 2LQ
                                     Tel. [phone]  Fax. [phone]
                                   [e-mail]  www.lindselltrain.com
                Lindsell Train Limited is authorised and regulated by the Financial Services Authority.





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