Interim Results

Martin Currie High Income Trust PLC 26 February 2002 To: Stock Exchange For immediate release 25 February 2002 MARTIN CURRIE HIGH INCOME TRUST plc Interim results for the six months to 31 January 2002 The six months to 31 January 2002 have been extremely difficult for stockmarkets in general and for your company in particular. The events of 11 September added to concerns over an already uncertain economic environment to produce serious stockmarket falls in the autumn of 2001, which had a direct impact on your company. The highly geared structure of the company means that it is particularly vulnerable to stockmarket falls. This problem is further compounded by the high exposure within the portfolio to highly geared high-yielding investment companies. As the level of assets relative to the loan amount fell, our arrangements with the bank required us, first, to hold cash and, then, to repay debt. This meant that we had to sell a substantial amount of the portfolio as the stockmarket hit new lows, and so we had substantially less exposure to the stockmarket as it recovered. Over the period, we sold securities to repay £21m of debt. At first we aimed to keep our exposure to stockmarket recovery by raising cash from the sale of corporate bonds. However, by mid-September we had sold this part of the portfolio. We were then forced to sell highly geared high-yielding investment companies and other equities. Our current arrangements with the bank allow us to 'offset' up to £10m in cash against the remaining £15.4m of debt. Furthermore, we must hold at least 75% of net debt in investments other than split capital investment companies. The reduced investment portfolio now generates significantly lower income. Furthermore, a number of our investment company holdings have suspended or reduced their dividends. As a consequence of this, the second interim dividend has been cut to 1.20p (1.75p), which represents a full distribution of earnings. The company remains exposed to any further reduction in dividends from our holdings, and to any further fall in the value of our assets, which means that we have to sell more securities and/or repay debt. Additionally, the board has decided to review the allocation of interest charges and management expenses between revenue and capital, on the basis of expected long-term returns from the current portfolio. Any change in allocation may have an impact on the level of the company's future dividends. - ends - For further information, please contact: Jeff Saunders/ Mike Woodward Martin Currie Investment Management Ltd 0131 229 5252 jsaunders@martincurrie.com/mwoodward@martincurrie.com MARTIN CURRIE HIGH INCOME TRUST plc Statement of total return (incorporating the revenue account)* for the period from 1 August 2001 to 31 January 2002 Revenue Capital Total £000 £000 £000 Losses on investments - realised - (3,348) (3,348) - unrealised - (5,997) (5,997) Income - franked 1,392 - 1,392 - unfranked 90 - 90 Investment management fee (38) (112) (150) Other expenses (106) (616) (722) _____ _____ _____ Net return on ordinary activities before finance costs and taxation 1,338 (10,073) (8,735) Interest payable and similar charges (192) (576) (768) _____ _____ _____ Net return on ordinary activities after finance costs and taxation 1,146 (10,649) (9,503) Dividends in respect of equity shares (1,106) - (1,106) _____ _____ _____ Transfer to/(from) reserves (after aggregate dividends paid and proposed of 2.95p ) 40 (10,649) (10,609) _____ _____ _____ Returns per ordinary share 3.06p (28.40p) (25.34)p * The revenue column of this statement is the profit and loss account of the company. All revenue and capital items derive from continuing operations. No operations were acquired or discontinued in the period. MARTIN CURRIE HIGH INCOME TRUST plc Statement of total return (incorporating the revenue account)* for the period from 1 August 2000 to 31 January 2001 Revenue Capital Total £000 £000 £000 (Losses)/ gains on investments - realised - (174) (174) - unrealised - 91 91 Income - franked 1,884 - 1,884 - unfranked 153 - 153 Investment management fee (46) (140) (186) Other expenses (102) - (102) _____ _____ _____ Net return on ordinary activities before finance costs and 1,889 (223) 1,666 taxation Interest payable and similar charges (324) (973) (1,297) _____ _____ _____ Net return on ordinary activities after finance costs and 1,565 (1,196) 369 taxation Dividends in respect of equity shares (1,313) - (1,313) _____ _____ _____ Transfer to/ (from) reserves (after aggregate dividends paid and proposed of 3.50p) 252 (1,196) (944) _____ _____ _____ Returns per ordinary share 4.17p (3.19)p 0.98p * The revenue column of this statement is the profit and loss account of the company. All revenue and capital items derive from continuing operations. MARTIN CURRIE HIGH INCOME TRUST plc Statement of total return (incorporating the revenue account)* for the year to 31 July 2001 Revenue Capital Total £000 £000 £000 Losses on investments - realised - (1,734) (1,734) - unrealised - (6,157) (6,157) Income - franked 3,795 - 3,795 - unfranked 325 19 344 Investment management fee (92) (276) (368) Other expenses (240) - (240) _____ _____ _____ Net return on ordinary activities before finance costs and taxation 3,788 (8,148) (4,360) Interest payable and similar charges (642) (1,926) (2,568) _____ _____ _____ Net return on ordinary activities after finance costs and taxation 3,146 (10,074) (6,928) Dividends in respect of equity shares (3,075) - (3,075) _____ _____ _____ Transfer to/ (from) reserves (after aggregate dividends paid and proposed of 8.20p (2000: 8.00p)) 71 (10,074) (10,003) _____ _____ _____ Returns per ordinary share 8.39p (26.86p) (18.47p) * The revenue column of this statement is the profit and loss account of the company. All revenue and capital items derive from continuing operations. MARTIN CURRIE HIGH INCOME TRUST plc BALANCE SHEET As at As at As at 31 January 2002 31 January 2001 31 July 2001 £000 £000 £000 £000 £000 £000 Investments at market value Listed on the Stock Exchange in the UK 15,640 60,965 48,639 Current assets Debtors 196 373 326 Short term deposits and bank balances 5,765 1,806 5,305 _______ _______ ______ 5,961 2,179 5,631 Creditors Amounts falling due within one year (856) (1,695) (1,880) _______ _______ ______ Net current assets 5,105 484 3,751 _______ ______ _______ Total assets less current liabilities 20,745 61,449 52,390 Creditors Amounts falling due outwith one year Loan (15,400) (36,400) (36,400) _______ _______ _______ Total net assets 5,345 25,049 15,990 _______ _______ _______ Capital and reserves Called up share capital 1,875 9,375 9,375 Share premium - 25,875 25,875 Capital reserves - realised (69) (6,389) (9,019) - unrealised (151) (4,412) (10,660) Revenue reserve 459 600 419 Special reserve 3,231 - - _______ _______ _______ Total shareholders' funds 5,345 25,049 15,990 _______ _______ _______ Net asset value per ordinary share 14.3p 66.8p 42.6p MARTIN CURRIE HIGH INCOME TRUST plc Statement of cash flow for the period from 1 August 2001 to 31 January 2002 £000 £000 Operating Activities Net dividends and interest received from investments 1,463 Interest received from deposits 34 Investment management fee (167) Cash paid to and on behalf of directors (26) Other cash payments (42) Other capital payments (652) ______ Net cash inflow from operating activities 610 Servicing of finance Interest paid (1,113) ______ Net cash outflow from servicing of finance (1,113) Taxation Net taxation received 71 Capital expenditure and financial investment Payments to acquire investments (2,489) Receipts from disposal of investments 26,143 ______ Net cash inflow from capital expenditure and financial investment 23,654 Dividends paid (1,762) ______ Net cash inflow before financing 21,460 Financing Movement in long term borrowings (21,000) ______ Net cash outflow from financing (21,000) Increase in cash for period 460 ______ MARTIN CURRIE HIGH INCOME TRUST plc Statement of cash flow for the period from 1 August 2000 to 31 January 2001 £000 £000 Operating Activities Net dividends and interest received from investments 2,044 Interest received from deposits 43 Investment management fee (211) Cash paid to and on behalf of directors (17) Other cash payments (41) ______ Net cash inflow from operating activities 1,818 Servicing of finance Interest paid (1,304) ______ Net cash outflow from servicing of finance (1,304) Taxation Net taxation received 29 Capital expenditure and financial investment Payments to acquire investments (2,304) Receipts from disposal of investments 3,151 ______ Net cash inflow from capital expenditure and financial investment 847 Dividends paid (1,688) ______ Net cash outflow before financing (298) Financing Movement in long term borrowings - ______ Net cashflow from financing - ______ Decrease in cash for period (298) ______ MARTIN CURRIE HIGH INCOME TRUST plc Statement of cash flow for the year to 31 July 2001 £000 £000 Operating Activities Net dividends and interest received from investments 4,137 Interest received from deposits 109 Investment management fee (367) Cash paid to and on behalf of directors (44) Other cash payments (183) ______ Net cash inflow from operating activities 3,652 Servicing of finance Interest paid (2,563) ______ Net cash outflow from servicing of finance (2,563) Taxation Net taxation received 69 Capital expenditure and financial investment Payments to acquire investments (6,282) Receipts from disposal of investments 11,325 ______ Net cash inflow from capital expenditure and financial investment 5,043 Dividends paid (3,000) ______ Net cash inflow before financing 3,201 Financing Movement in long term borrowings - ______ Net cashflow from financing - ______ Increase in cash for period 3,201 ______ This information is provided by RNS The company news service from the London Stock Exchange

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