Interim Results

MURRAY INTERNATIONAL TRUST PLC INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2004 The Directors of Murray International Trust PLC report the unaudited results of the company for the six months ended 30 June 2004. ·Net Asset Value Total Return, with net income reinvested, for the six months ended 30 June 2004 was +2.0% compared with a return of +2.3% on the composite benchmark. ·Equities continue to outperform bonds as financial markets begin discounting the prospects of higher interest rates. ·The Board intends to recommend a maintained final dividend of 5.95p in respect of the year ending 31 December 2004, payable in May 2005. Background Financial markets struggled to make much progress over the past six months. Weighed down by soaring oil prices, concerns over booming property prices and fears over the rapid pace of credit expansion, the consensus opinion became increasingly bearish about the prospects for interest rates. Government bonds suffered a difficult six months as rising commodity prices concentrated the "inflation sensitive" minds of fixed interest investors. Longer-dated bond yields moved higher as additional inflation premiums were priced into fixed income markets, causing many yield curves to steepen. Bond markets remained uncertain as to the scope and magnitude of interest rate rises deemed necessary by policy makers to reduce the amount of stimulus in the financial system. Against this backdrop, equity markets also traded nervously. Market returns, as ever, were influenced by currency movements, most notably the strength of sterling versus the euro and the yen, although the pound/US dollar exchange rate remained relatively flat over the period. In sterling terms, the US market returned 2.1%, the UK 1.9%, Europe 1.7% and the Pacific ex Japan -0.3%. The only notable returns came from Japan, where the equity market rose 9.6% over the period. On a sectoral basis there was a somewhat defensive bias with consumer staples, energy and utilities all outperforming. Sectors judged to be cyclically sensitive to rising interest rates, such as financials, technology and commodity materials, all underperformed. Performance The Net Asset Value total return, with net income reinvested for the six months to 30 June 2004 was 2.0% compared with a return of 2.3% on the composite benchmark (40% of the FTSE World-UK and 60% of the FTSE World ex UK indices). Asset allocation towards equities was broadly neutral for the portfolio over the period, with the negative effects of being overweight Asian markets being offset by being overweight in Japan. Relative asset allocation positions in the US, Europe and the UK had virtually no impact. Stock selection was positive in every geographical region except for Asia, with the UK and Japan contributing significantly to outperformance. However, the total portfolio was negatively impacted by the asset allocation towards bonds. Although the fixed interest portfolio was defensively positioned in high quality, short duration bonds and therefore performed relatively well, it still experienced capital losses in what proved to be an extremely tough period for the asset class. Share Buy-backs During the six months ended June 2004, the Company did not repurchase any Ordinary shares, although it retains the authority to do so. The discount at which the shares traded to their Net Asset Value widened slightly during the six months from 8.5% to 10.6%. Activity Portfolio activity during the period was directed towards capitalising on opportunities that arose during periods of increased market volatility. On a geographic basis, exposure to the Pacific region was increased during bouts of risk-aversion induced weakness, as was exposure to Emerging markets. On a sectoral basis, exposure to energy was slightly reduced having served the portfolio particularly well over the past eighteen months, but the overweight position has been retained. The process of reducing the portfolio's pro-cyclical bias towards industrials continued with the proceeds being reinvested in "late cycle" sectors such as Telecoms, where strong balance sheets and strong cash flows offer attractive yields and above-average dividend growth. Dividends For the current year the Board has already declared that three interim dividends of 3.45p per share be paid on 16 August and 17 November 2004 and 16 February 2005. The Board intends to recommend a maintained final dividend of 5.95p in respect of the year ending 31 December 2004, payable in May 2005. Outlook The unequivocal improvement in global economic activity over the past six months has prompted financial markets to respond, up till now at least, in a fairly typical cyclical manner. The relative returns from equities and bonds over the period are testimony to this. However, as the current global economic cycle evolves against an uncertain backdrop of escalating terrorism, historically high oil prices and rising trade tensions, a definitive distinction between the developed and developing world is emerging as key to future prospects: namely that of debt. Forty percent of present global GDP (mainly the US and UK) is based in highly indebted economies, stretched by the burdens of credit based growth policies, debt cultures and future prospects dictated by debt servicing demands. With burgeoning budget deficits and household debt at record levels, these nations find themselves living beyond their means, dependent on foreign capital, vulnerable to exogenous shocks and pressures. Confined to an outlook of sub-trend growth, lower consumption, lack of fiscal flexibility and declining currencies, equity markets in the US and UK offer little appeal from a global perspective. Conversely, the outlook is much brighter for the surplus savings nations of the developing world. Cyclical and secular growth improvement remain intact. Stronger domestic economies, reduced dependency on traditional export markets, robust commodity prices and supportive global liquidity remain cyclical positives. Also secular improvements, such as declining capital costs, rising real incomes, competitive currencies, high domestic savings and huge foreign exchange reserves dramatically reduce the sensitivity to global capital flows. Indeed, as major lenders to the developed world, the developing world is increasingly becoming an integral part of the global financial system. However, at the current juncture, the most compelling case for the developing world remains growth, earnings and market values. Forecast to grow at twice the rate of the developed world in 2004 and 2005, this should translate into high double-digit earnings growth. Such profitability at current market levels strongly supports the investment case for staying overweight Asian and Emerging market equities. Finally, in addition to these structural factors, there are the basic issues of expectations and valuation. Where high expectations and high valuations prevail, as in the US market, the manager will continue to be cautious. Conversely, in markets such as Japan and Europe, where expectations remain low and valuations are attractive, the portfolio will continue its overweight stance. Moreover, the portfolio will maintain its strict adherence to those companies throughout the world, where strong balance sheets, decent dividend yields with good dividend growth, achievable returns and quality assets are dominant characteristics. Statement of Total Return (Incorporating the Revenue Account of the Company) Six months to 30 June 2004 (unaudited) Revenue Capital Total £'000 £'000 £'000 Gains/(losses) on sales - 3,331 3,331 Unrealised (losses)/gains - (268) (268) --------- --------- -------- Gains on investments - 3,063 3,063 Income from investments 10,376 - 10,376 Other income 159 - 159 Investment management fees (329) (768) (1,097) Currency (losses)/gains - (2,168) (2,168) Other expenses (581) - (581) --------- --------- -------- Net return before finance costs and 9,625 127 9,752 taxation Finance costs of borrowing (388) (1,313) (1,701) --------- --------- -------- Return on ordinary activities before tax 9,237 (1,186) 8,051 Tax on ordinary activities (1,688) 1,208 (480) --------- --------- -------- Return attributable to equity 7,549 22 7,571 Shareholders Ordinary dividends on equity shares (8,943) - (8,943) --------- --------- -------- Transfer (from)/to reserves (1,394) 22 (1,372) --------- --------- -------- Return per Ordinary share (pence) 8.7 0.0 8.7 --------- --------- -------- Return per Ordinary share assuming full conversion of the B Ordinary shares (pence) 8.6 0.0 8.6 --------- --------- -------- Statement of Total Return (Incorporating the Revenue Account of the Company) Six months to 30 June 2003 (unaudited) Revenue Capital Total £'000 £'000 £'000 Gains/(losses) on sales - (15,178) (15,178) Unrealised (losses)/gains - 39,391 39,391 -------- -------- ------- Gains on investments - 24,213 24,213 Income from investments 9,708 - 9,708 Other income 124 - 124 Investment management fees (454) (1,059) (1,513) Currency (losses)/gains - 571 571 Other expenses (408) - (408) -------- -------- ------- Net return before finance costs and 8,970 23,725 32,695 taxation Finance costs of borrowing (462) (1,078) (1,540) -------- -------- ------- Return on ordinary activities before tax 8,508 22,647 31,155 Tax on ordinary activities (1,330) 944 (386) -------- -------- ------- Return attributable to equity 7,178 23,591 30,769 Shareholders Ordinary dividends on equity shares (8,939) - (8,939) -------- -------- ------- Transfer (from)/to reserves (1,761) 23,591 21,830 -------- -------- ------- Return per Ordinary share (pence) 8.3 27.3 35.6 -------- -------- ------- Return per Ordinary share assuming full conversion of the B Ordinary shares 8.2 26.9 35.1 (pence) -------- -------- ------- Statement of Total Return (Incorporating the Revenue Account of the Company) Year ended 31 December 2003 (audited) Revenue Capital Total £'000 £'000 £'000 Gains/(losses) on sales - (14,991) (14,991) Unrealised (losses)/gains - 83,814 83,814 -------- -------- ------- Gains on investments - 68,823 68,823 Income from investments 16,278 - 16,278 Other income 515 - 515 Investment management fees (852) (1,994) (2,846) Currency (losses)/gains - (1,321) (1,321) Other expenses (995) - (995) -------- -------- ------- Net return before finance costs and 14,946 65,508 80,454 taxation Finance costs of borrowing (946) (2,208) (3,154) -------- -------- ------- Return on ordinary activities before tax 14,000 63,300 77,300 Tax on ordinary activities (2,493) 1,918 (575) -------- -------- ------- Return attributable to equity 11,507 65,218 76,725 Shareholders Ordinary dividends on equity shares (14,081) - (14,081) -------- -------- ------- Transfer (from)/to reserves (2,574) 65,218 62,644 -------- -------- ------- Return per Ordinary share (pence) 13.3 75.5 88.8 -------- -------- ------- Return per Ordinary share assuming full conversion of the B Ordinary shares 13.1 74.5 87.6 (pence) -------- -------- ------- Balance Sheet At 31 At 30 June At 30 June December 2004 2003 2003 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Fixed assets Investments 466,905 402,946 455,872 Current assets Debtors 4,694 3,645 3,085 Cash and short-term 8,510 29,530 22,177 deposits --------- ---------- --------- 13,204 33,175 25,262 Creditors Amounts falling due within (25,338) (20,901) (34,367) one year --------- ---------- --------- Net current (liabilities)/ (12,134) 12,274 (9,105) assets --------- ---------- --------- Total assets less current 454,771 415,220 446,767 liabilities Creditors Amounts falling due after (84,751) (84,641) (75,375) more than one year --------- ---------- --------- Net assets 370,020 330,579 371,392 --------- ---------- --------- Capital and reserves Equity shareholders' interest: Ordinary called up share 21,901 21,890 21,890 capital Share premium account 23 23 23 Capital redemption reserve 8,230 8,230 8,230 Capital reserve - realised 280,455 283,847 286,358 Capital reserve - 34,283 (10,746) 28,369 unrealised Revenue reserve 25,128 27,335 26,522 --------- ---------- --------- Equity shareholders' funds 370,020 330,579 371,392 --------- ---------- --------- Diluted Net Asset Value per Ordinary and B Ordinary share (pence) 422.4 377.5 424.2 --------- ---------- --------- Cash Flow Statement Six months Six months Year ended to to 31 December 30 June 2004 30 June 2003 2003 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Operating activities Investment income received 8,982 9,408 15,961 Deposit interest received 156 124 514 Underwriting commission - - 3 received Investment management fees (1,082) (1,452) (2,800) paid Secretarial fees paid (49) (48) (98) Cash paid to and on behalf of (38) (23) (51) Directors Other cash payments (394) (510) (1,007) ---------- ---------- --------- Net cash inflow from 7,575 7,499 12,522 operating activities Returns on investment and servicing of finance Interest paid (1,383) (1,545) (3,139) Break costs on repayment of (407) - - loan Financial investment Purchases of investments (63,615) (33,411) (86,371) Sales of investments 60,197 61,368 106,367 ---------- ---------- --------- Net cash (outflow)/inflow (3,418) 27,957 19,996 from financial investment Equity dividends paid (8,121) (8,119) (14,079) ---------- ---------- --------- Net cash (outflow)/inflow (5,754) 25,792 15,300 before financing Financing Loans repaid (11,545) - - Loans received 11,545 - - Repurchase of Ordinary - (2) - shares ---------- ---------- --------- Net cash outflow from - (2) - financing ---------- ---------- --------- (Decrease)/increase in cash (5,754) 25,790 15,300 ---------- ---------- --------- MURRAY INTERNATIONAL TRUST PLC Note 1 The number of B ordinary shares converted into ordinary shares on 30 June 2004 was 84,635. The allotted ordinary share capital as of 30 June 2004 was: 86,497,234 Ordinary shares of 25p 1,107,088 B Ordinary shares of 25p Note 2 6 months 6 months Year to to to 31 December 30 June 2004 30 June 2003 2003 Dividends on ordinary shares £'000 £'000 £'000 Interims of - 3.45p payable 16.8.04 (2003 - 2,981 2,980 2,980 3.45p) - 3.45p payable 17.11.04 (2003 - 2,981 2,980 2,980 3.45p) - 3.45p payable 16.2.05 (2003 - 2,981 2,980 2,980 3.45p) Final dividend (2003 - 5.95p) - - 5,141 Over accrual of previous year's - (1) - dividends due to share buybacks ----------- ----------- ----------- 8,943 8,939 14,081 ----------- ----------- ----------- Note 3 A summary of investment changes during the period and a schedule of the twenty largest equity investments at 30 June 2004 are attached. Note 4 The financial information for the six months ended 30 June 2004 and 30 June 2003 comprises non-statutory accounts within the meaning of Section 240 of the Companies Act 1985. The financial information for the year ended 31 December 2003 has been abridged from published accounts that have been delivered to the Registrar of Companies and on which the report of the Auditors was unqualified. The interim accounts have been prepared on the same basis as the annual accounts. By order of the Board ABERDEEN ASSET MANAGEMENT PLC, SECRETARY 5 August 2004 Copies of this announcement will be printed and issued to shareholders and will be available to the public at the registered office of the Company, 123 St Vincent Street, Glasgow. MURRAY INTERNATIONAL TRUST PLC SUMMARY OF INVESTMENT CHANGES Valuation Appreciation Valuation 31 December 2003 Transactions (depreciation) 30 June 2004 £'000 % £'000 £'000 £'000 % Equities United Kingdom 145,035 31.6 3,329 627 148,991 32.8 Americas 74,638 16.3 4,321 1,282 80,241 17.6 Europe & Africa 72,310 15.8 (3,643) 989 69,656 15.3 Japan 34,440 7.5 (691) 4,329 38,078 8.4 Middle East, Far East & 45,111 9.8 1,085 (1,490) 44,706 9.8 Australasia -------- ------ --------- --------- ------- ------- 371,534 81.0 4,401 5,737 381,672 83.9 -------- ------ --------- --------- ------- ------- Fixed income United Kingdom 45,656 10.0 10,314 (913) 55,057 12.1 Europe & Africa 38,682 8.4 (10,652) (1,654) 26,376 5.8 Americas - - 3,907 (107) 3,800 0.9 -------- ------ --------- --------- ------- ------- 84,338 18.4 3,569 (2,674) 85,233 18.8 -------- ------ --------- --------- ------- ------- Other net assets/ 2,884 0.6 (10,237) (4,781) (12,134) (2.7) (liabilities) -------- ------ --------- --------- ------- ------- Total assets 458,756 100.0 (2,267) (1,718) 454,771 100.0 -------- ------ --------- --------- ------- ------- Valuation Summary of Net Assets 30 June 2004 ----------------------- £000 % Equities 381,672 103.2 Fixed income 85,233 23.0 Other net liabilities (12,134) (3.3) Borrowings and prior capital (84,751) (22.9) ------- ------- Equity shareholders' interest 370,020 100.0 ======= ======= Twenty Largest Equity Investments As at 30 June 2004 Investment Valuation % of total Security Area £'000 assets+ Atrium Underwriting UK 18,223 4.0 September 2004 S&P Index Future USA 15,721 3.5 BP UK 11,201 2.5 Shell Transport & Trading * UK & 10,184 2.2 Netherlands GlaxoSmithKline UK 9,988 2.2 Vodafone Group UK 7,728 1.7 The Royal Bank of Scotland UK 6,987 1.5 AstraZeneca UK 6,185 1.4 British American Tobacco * UK & 5,869 1.3 Malaysia Petrobras ADR Brazil 5,547 1.2 Unilever * UK & 4,835 1.1 Indonesia Aviva UK 4,768 1.0 BT Group UK 4,764 1.0 Barclays UK 4,298 0.9 Volvo Sweden 4,223 0.9 United Health Group US 3,947 0.9 HSBC Holdings UK 3,903 0.9 Tenaris ADR Mexico 3,818 0.8 Land Securities UK 3,767 0.8 San Paolo - IMI Italy 3,665 0.8 -------- ------- Top twenty investments 139,621 30.6 -------- ------- * Holding also comprises associated companies. + Represents total assets less current liabilities. In addition to the equity exposure detailed above, as at 30 June 2004 the portfolio also included the related fixed interest holdings detailed below: Valuation % of total Security £'000 assets+ Vodafone Group 5.75% 27/10/06 1,419 0.3 BAT International Finance 5.75% 9/12/13 957 0.2 Barclays Bank PLC 5.75% 8/3/11 1,453 0.3 HSBC Capital Funding 5.3687% 1,705 0.4

Companies

Murray International Trust (MYI)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today