Chairman's Statement

Rights and Issues Inv Trust PLC
15 February 2001

Chairman's Statement


The bull market of the late 1990's came to an abrupt end in 2000 with FTSE
All-Share Index falling by 8.0%. Smaller companies fared slightly better with
rises of 2.8% for the FTSE Small Cap Index and 5.0% for the FTSE Fledgling
Index. These bare statistics however disguise the stark variations in sector
performance. A year ago it seemed that all the traditional investment rules
had been superseded by the brash new technology and telecommunications
sectors. This euphoria could not sustain itself and this last year saw the
restoration of reality. The two-tier market of 1999 turned somersault and the
traditional sectors prospered while blue sky stocks crashed.


The Trust's emphasis on soundly based situations therefore benefited from this
change in market sentiment. The net asset value of the capital shares rose
from 1590.9p to 1895.4p and that of the income shares from 396.3p to 467.9p.
These increases represent rises of 19.1% and 18.1% respectively and
outperformance of the FTSE All-Share Index of over 26%.


Your Directors have decided to raise the dividend to 25.5p per income share
and 1.275p per capital share for 2000. This 13% rise is again in excess of the
prevailing rate of inflation. Additionally, the supplementary capital dividend
of 30.0488p per capital share was paid on 2nd January 2001 and, barring
unforeseen circumstances, the supplementary capital dividend for the current
year will be 39.7073p per capital share payable on 2nd January 2002. This 32%
increase reflects the sustained capital performance of recent years.


Every five years your Directors consider the future of the Trust in order to
satisfy themselves that the Trust is meeting its objectives. Over the last
five years the Trust's shareholders funds have increased from £16.2m in 1995
to £42.8m in 2000. This is an increase of 165% and compares very favourably
with the rise of 66% by the FTSE All-Share Index over the period. At the same
time, the dividend per income share has risen from 10.5p in 1995 to 25.5p in
2000. This is an annualised increase of 19.4% and massively exceeds the 3%
rate of inflation over the five years. In the light of these results, your
Directors believe that the objectives have been achieved and propose extending
the life of the Trust to 25th July 2006. At that time the future of the Trust
will again be judged in the light of the performance of the Trust.


The market currently appears directionless awaiting both the downswing in the
interest rate cycle and a likely 2001 general election. This will provide
plenty of investment opportunities for your Trust in the forthcoming year.


                                                                 S.H.J.A.Knott

                                                                      Chairman