Interim Results for six months to 31 July 2006

To: Stock Exchange For immediate release: 27 September 2006 Martin Currie Portfolio Investment Trust plc Interim results for the six months to 31 July 2006 · Our UK listed investments outperformed the FTSE All Share index. But our international stocks performed poorly, reflecting weak overseas stockmarkets and currencies, in particular the yen and the dollar. As a result, the net asset value per share rose by 1.1% compared to a rise in the benchmark of 2.6%. · An unchanged interim dividend of 0.5p per share payable on 27 October 2006 to shareholders on the register on 6 October 2006. Chairman's statement Performance Over the last six months, returns from the fund have been modest - the net asset value ("NAV") rose by 1.1%. This represented a degree of underperformance by the fund relative to its benchmark, the FTSE All Share index, which returned 2.6%. Consequently, no provision has been made against NAV for the payment of a performance fee to the manager. That said, the Board hopes that, aligning the manager's interest with that of shareholders, we shall again pay a performance fee for the full year. The fund's investment manager, Tom Walker, considers the underlying reasons for this performance in his review. He then outlines the reasons why he is taking a positive view of the prospects for equity markets. Discount The Board's policy remains to maintain the discount, where possible, in single figures utilising, as necessary, the company's buyback powers. Over the six- month period to 31 July 2006 we bought back 1,560,551 shares or 1.0% of the share capital as at 31 January 2006, at discounts ranging from 7.1% to 10.9%. This added 0.1% to NAV per share. On 31 July, the discount stood at 9.4%. Earnings and dividends The lacklustre progress made by equity markets over the period might initially be taken to imply that there has been a slowdown in corporate earnings growth. However, earnings growth has actually been robust; in addition, there has been an increased focus on improving returns to shareholders on the part of many companies. This is reflected in the portfolio. Revenue return per share has increased by 11.2% when compared with the first half of the last financial year, from 1.34p to 1.49p. The board has declared an interim dividend of 0.50p per share, unchanged on the level for the same period last year. This dividend will be paid on 27 October 2006 to shareholders on the register on 6 October. Outlook The company's investment portfolio consists predominantly of UK-listed equities, with less than 20% being invested directly in overseas securities as at 31 July. However, due to the importance of global operations to many of the UK's largest companies, the British stockmarket and the Portfolio Trust both have a high degree of exposure to overseas economies. In the past few weeks, there has been little movement in the UK market, but it remains within 96% of the levels reached earlier in the year. Over the intervening months, the prospects for world economic growth have not changed markedly, as Tom Walker discusses in more detail in his review. This supports a broadly positive outlook for profits and dividends which, given the multiple on which UK equities are currently trading, means that UK share prices remain relatively attractive. Recent events both in the Middle East and at airports in the UK have highlighted the many risks to sentiment. Sadly, such events appear to have become a fact of life and therefore exert little long-lasting impact upon world financial markets. Hence, with relatively benign economic and corporate conditions prevailing globally, there is scope for equities to make progress over the next few months. Peter Berry Manager's report Performance Our UK listed investments outperformed the FTSE All Share index. But our international stocks performed poorly, reflecting weak overseas stockmarkets and currencies, in particular the yen and the dollar. In this six-month period, our overseas investments account for almost all the underperformance. Review United Kingdom The UK market outperformed most other equity markets and the gilt market in this period. At a time when investors lost some of their appetite for risk, the low- risk characteristics of the UK market stood it in good stead. For example the UK has very few technology companies, which has been the weakest sector of global equity markets over the last six months. Equally, defensive sectors such as pharmaceuticals, utilities and foods are well represented. The market's increased risk aversion was also reflected in the outperformance of large caps relative to smaller companies. Both large and medium-sized companies produced positive returns over the period. But after outperforming for much of 2003, 2004 and 2005, smaller companies finally fell out of favour - the FTSE Small Cap index produced a negative return over the period. International Our exposure to overseas markets is a relatively modest 20% of assets, but, while the total return of the FTSE All Share index was 4.5%, the FTSE World ex- UK index actually fell 3.3% in the six-month period. Shifting exchange rates have been one of the key determinants of performance. The weakness of the yen and the dollar affected bottom-line returns adversely. Japan has been one of the worst performing markets as the Bank of Japan tightened money supply when it ended its policy of quantitative easing. The US was also weak. Concerns over economic growth, inflation and interest rates continued to mount and volatility rose sharply. Private equity Having performed extremely strongly in recent years, our private equity investments underperformed marginally during the last 6 months. Clearly, the private equity cycle is moving closer to maturity but we have benefited as both Candover and 3i have repaid excess capital back to their shareholders. In addition, we continue to enjoy the uplift on realisations from F&C Private Equity Trust A-shares, which represent 6% of assets. Stock selection Stock selection is where I aim to add value over the longer term. Among stock selection successes, Lafarge North America (building materials) and Schering (pharmaceuticals) were taken over at healthy premia. Elsewhere, the strong earnings growth being generated by Vedanta and Infosys, whose principal operations are in India, was rewarded by good share price performance. Tesco finally converted its strong operating performance into share price appreciation, while Man Group, the hedge fund manager, was rewarded for its continued successes. At a time when many were worrying about US consumers, our two US retailers, CVS and Kohl's, were among our top-performing holdings. At the other end of the scale, our three investments in Japan, most notably Tokyu Corporation (which I have now sold), did poorly. Despite the continued rise in the oil price, our energy investments also underperformed, as did technology stocks Samsung Electronics, EMC and Microsoft, the last of which I have sold. Outlook Markets have been especially weak since mid-May and have been highly volatile. This probably reflects the considerable uncertainty surrounding the future direction of interest rates, notably in the USA, but also worldwide. The US economy's unsustainably high rate of growth is bound to slow - and possibly China's too. Investors are nervous that inflation will force central banks to raise interest rates too far, causing a collapse in growth or even a recession. So the volatility has arisen as investors fret, first about recession and then about inflation - nearly every 'top-down` economic statistic points to one or the other! The `Goldilocks economy' (neither too hot nor too cold) seems a distant memory. The European economy is doing better than it has done for years and we should be encouraged that the European Central Bank is nudging interest rates higher. The UK has also grown more rapidly than was anticipated just six months ago. The Bank of England is now forecasting 2.8% GDP growth this year and 3.1% in 2007. I still believe that Japan's economic recovery is intact, frustratingly slow though it is. Recent strong capital investment data and bank lending figures, which hit a new ten-year high, confirm this trend. With interest rates at only 0.25% in Japan, higher rates are almost inevitable but they will confirm a return to greater economic resilience. China's economy certainly experiences 'hotspots` that require dousing from time to time. But I believe strongly that its economic growth rate will lead the world for many years to come. Finally and most importantly, I believe the USA, still easily the largest economy in the world, will continue to grow. At some stage, the economic cycle will lead to a recession but I do not see this in the next two years. So I do not feel slow growth is a major threat at present. Nor do I believe that current modest inflation will rise to the extent of forcing penal interest rates. I prefer to focus on companies rather than markets but I believe these 'top- down` concerns are a significant influence on the market at present and may continue to be so for a few months yet. As a result, in a strong earnings season, companies reporting positive earnings have enjoyed only modest share price reaction, if any at all. Companies that have disappointed with earnings have been harshly punished. So I think that in many cases equity valuations appear quite attractive. The portfolio is positioned to benefit from continued economic growth. The thrust of our stock selection process is to identify companies whose earnings prospects are under-appreciated. For example, I believe the current scepticism around global growth has resulted in analysts' earnings expectations being far too modest for many resource companies. We are overweight in the resource sector. We also remain committed to private equity. Our holdings there represent 15% of assets. With political unrest adding to the economic uncertainties, it is easy to see why investors are on edge at the moment. I share this nervousness but believe that a combination of growth and reasonable valuation should allow equity markets to appreciate over the next year. Tom Walker For more information, please contact: Tom Walker twalker@martincurrie.com 0131 229 5252 MARTIN CURRIE PORTFOLIO INVESTMENT TRUST plc INCOME STATEMENT for the six months to 31 July 2006 Unaudited Revenue Capital Total £000 £000 £000 Gains / (losses) on - realised - 3,883 3,883 investments - unrealised - (5,121) (5,121) Currency gains - 6 6 Income - franked 2,289 3,045 5,334 - unfranked 403 - 403 Investment management fee (179) (358) (537) Performance fee - (131) (131) Other expenses (257) - (257) _______ _______ _______ Net return before finance costs and 2,256 1,324 3,580 taxation Finance costs - shareholders' funds (2,544) (1,171) (3,715) Finance costs - repurchase of shares - 161 161 _______ _______ _______ Return on ordinary activities before (288) 314 26 taxation Taxation on ordinary activities (26) - (26) _______ _______ _______ Return attributable to shareholders (314) 314 - _______ _______ _______ Returns per ordinary share (as defined by the Articles) are detailed in note 1. The total column of this statement is the profit and loss account of the company. All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued in the period. The directors have declared an interim dividend of 0.50p per share, which will be paid on 27 October 2006 to shareholders on the register on 6 October 2006. The interim results will be circulated to shareholders in the form of an interim report, copies of which will be available at the company's registered office, Saltire Court, 20 Castle Terrace, Edinburgh EH1 2ES. MARTIN CURRIE PORTFOLIO INVESTMENT TRUST plc INCOME STATEMENT for the period to 31 July 2005 Unaudited Revenue Capital Total £000 £000 £000 Gains on investments - realised - 1,905 1,905 - unrealised - 12,632 12,632 Currency losses - (31) (31) Income - franked 2,170 2,238 4,408 - unfranked 386 - 386 Investment management fee (108) (218) (326) Performance fee - (431) (431) Other expenses (269) - (269) _______ _______ _______ Net return before finance costs and 2,179 16,095 18,274 taxation Finance costs - shareholders' funds (3,842) (14,650) (18,492) Finance costs - repurchase of shares - 244 244 _______ _______ _______ Return on ordinary activities before (1,663) 1,689 26 taxation Taxation on ordinary activities (26) - (26) _______ _______ _______ Return attributable to shareholders (1,689) 1,689 - _______ _______ _______ Returns per ordinary share (as defined by the Articles) are detailed in note 1. The total column of this statement is the profit and loss account of the company. All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued in the period. MARTIN CURRIE PORTFOLIO INVESTMENT TRUST plc BALANCE SHEET As at 31 July 2006 As at 31 July 2005 As at 31 January (unaudited) (unaudited) 2006 (audited) £000 £000 £000 £000 £000 £000 Fixed assets Investments at 175,973 163,202 179,20 market value 7 Current assets Debtors 434 539 242 Cash at bank 2,847 1,942 2,145 _______ _______ _______ 3,281 2,481 2,387 Creditors Amounts falling due within one (309) (835) (1,943) year _______ _______ _______ Net current 2,972 1,646 444 assets _______ _______ ______ _ Net asset value 178,945 164,848 179,65 attributable to 1 shareholders _______ _______ ______ _ Net asset value 119.7p 103.1p 118.9p per ordinary share AIC net asset 118.2p 102.4p 116.9p value per ordinary share MARTIN CURRIE PORTFOLIO INVESTMENT TRUST plc STATEMENT OF CASH FLOW Six months to Six months to 31 July 2006 31 July 2005 (unaudited) (unaudited) £000 £000 £000 £000 Operating activities Net dividends and interest received from investments 5,477 4,661 Interest received from 56 124 deposits Investment management fee (2,104) (499) Cash paid to and on behalf of directors (63) (60) Bank charges (19) (12) Net taxation paid (29) (3) Other cash payments (358) (229) _______ _______ Net cash inflow from 2,960 3,982 operating activities Servicing of finance Finance costs - (2,544) (3,812) shareholders' funds _______ _______ Net cash outflow from (2,544) (3,812) servicing of finance Capital expenditure and financial investment Payments to acquire (15,877) (42,748) investments Receipts from disposal of 17,872 43,491 investments Foreign exchange differences 6 (31) _______ _______ Net cash inflow from capital 2,001 712 expenditure and financial investment _______ _______ Net cash inflow before 2,417 882 financing Financing Repurchase of ordinary share (1,715) (1,576) capital _______ _______ Net cash outflow from (1,715) (1,576) financing _______ _______ Increase/(decrease) in cash 702 (694) for the period _______ _______ Notes 1. Returns and net asset value The return and net asset value per ordinary share are calculated with reference to the following figures: Six months Six months Revenue return to to 31 July 31 July 2006 2005 Return attributable to (£314,000) (£1,689,00 ordinary shareholders 0) Add back finance costs: £2,544,000 £3,842,000 shareholders' funds __________ __________ _ _ £2,230,000 £2,153,000 Average number of shares in 149,720,12 160,860,97 issue during period 6 8 Revenue return per ordinary 1.49p 1.34p share Capital return Capital return attributable £314,000 £1,689,000 to ordinary shareholders Adjustment for movement in £1,171,000 £14,650,00 redemption entitlement 0 __________ __________ _ _ £1,485,000 £16,339,00 0 Average number of shares in 149,720,12 160,860,97 issue during period 6 8 Capital return per ordinary 0.99p 10.15p share Net asset value per share As at 31 As at 31 As at 31 July 2006 July 2005 January 2006 Net assets attributable to £178,945,0 £164,848,0 £179,651,000 shareholders 00 00 Number of shares in issue at 149,529,85 159,856,27 151,090,401 period end 8 6 Net asset value per share 119.7p 103.1p 118.9p 2. Reconciliation of accounting and AIC net asset values As at 31 As at 31 As at 31 July 2006 July 2005 January 2006 Accounting net asset value 119.7p 103.1p 118.9p per share Adjustment per share from bid - 0.6p - to mid price valuation of investments Exclusion of undistributed (1.5p) (1.3p) (2.0p) current period revenue ___________ ___________ ___________ AIC net asset value per share 118.2p 102.4p 116.9p

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