Interim Results

Temple Bar Investment Trust PLC 25 July 2000 CHAIRMAN'S STATEMENT Results After a difficult period in the last months of 1999 and the early part of the current year I am able to report that the asset performance in the six months to 30 June 2000 has been encouraging. Total assets rose marginally by 0.26% (including accrued income) and this compares favourably with a fall of 6.55% in the FTSE All-Share Index. The FTSE 350 Higher Yield Index continued to be volatile and fell by 0.8% despite a strong rally in the last couple of months. The Trust's earnings have made further progress, and there has been a small benefit in this half year deriving from the use of the debenture proceeds over the full period. The directors have declared an interim dividend of 7.53p, an increase of approximately 10% and expect, barring unforeseen circumstances, that the same rate of dividend increase will be proposed in respect of the final dividend. The interim dividend will be paid on 30 September 2000 to those shareholders on the register on 15 September 2000. Investment Background Attention continues to be focused on whether the US economy can achieve a controlled slowdown after such a strong and sustained period of growth. The UK prospects have continued to improve and although the recent fall in Sterling may result in slightly higher interest rates, the important elements of consumer spending and average earnings growth are both showing clear signs of easing. The UK equity markets have continued to show sizeable share price fluctuations. Our view that there would be a switch back into value stocks from the higher growth technology, media and telecom sectors proved correct, and in March conditions started to improve for higher yielding shares. Because of the Trust's liquidity arising from last year's gearing the managers were able to make further substantial purchases across a range of 'old economy' sectors ahead of their recovery. Some profits have subsequently been taken on these investments. Outlook We remain convinced that investment in companies with strong market positions, excellent management teams and good financial performance will provide sound value and enable us to continue to provide our shareholders with a growing income. We have some concerns that the overall equity market has failed to make progress in the first half of the year despite an economic background which has been showing signs of improvement and the market shows few signs of breaking out of its current tight trading range. What is required to move shares higher is greater clarity over the outlook for UK interest rates and, crucially, how successful the US authorities are in achieving a soft landing. We are, therefore, reverting to a more cautious stance for the time being. 25 July 2000 Ronald Scott Brown Twenty largest equity holdings at 30 June 2000 Company Valuation % of £'000 portfolio BP Amoco 31,542 7.36 Shell Transport & Trading 21,377 4.99 Glaxo Wellcome 16,744 3.91 Lloyds TSB 16,092 3.75 Cable & Wireless 13,456 3.14 Royal Bank of Scotland 13,096 3.05 Boots 12,327 2.88 CGNU 12,229 2.85 British Telecom 11,593 2.70 Safeway 10,490 2.45 Diageo 9,472 2.21 Carlton Communications 9,104 2.12 HSBC 8,278 1.93 Rio Tinto 8,200 1.91 Abbey National 7,963 1.86 Hilton 7,810 1.82 Whitbread 7,779 1.81 Guinness Flight Institutional UK Smaller Companies Trust 7,049 1.64 National Grid 6,892 1.61 BAA 6,821 1.59 _______ _____ 238,314 55.58 _______ _____ STATEMENT OF TOTAL RETURN (incorporating the revenue account) of the group for the six months ended 30 June 2000 Six months ended 30 June 2000 (unaudited) Notes Revenue Capital Total £'000 £'000 £'000 Gains on investments 4 - 51 51 Income 5 8,666 - 8,666 Investment management fee (337) (337) (674) Other expenses (280) - (280) ------- ------ ----- Net return before finance costs and taxation 8,049 (286) 7,763 Interest payable (1,140) (1,140) (2,280) ------- ------ ------ Return on ordinary activities before taxation 6,909 (1,426) 5,483 Taxation* (193) 193 - ------ ------ ------ Return on ordinary activities after taxation 6,716 (1,233) 5,483 Preference dividends - - - ------ ------ ------ Available for equity shareholders 6,716 (1,233) 5,483 Ordinary dividends (4,352) - (4,352) ------ ------ ------ Transfer to reserves 2,364 (1,233) 1,131 ------ ------ ------ Return per ordinary share 11.62p (2.13)p 9.49p Dividends per ordinary share 7.53p *Comparative figures have been re-stated to show UK dividends net of related tax credits. Six months ended Year ended 30 June 1999 31 December 1999 (unaudited-re-stated*) (audited-re-stated*) Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 - 43,364 43,364 - 37,443 37,443 8,971 - 8,971 15,870 - 15,870 (335) (335) (670) (672) (672) (1,344) (259) - (259) (580) - (580) ----- ------ ------ ------ ------ ------ 8,377 43,029 51,406 14,618 36,771 51,389 (951) (951) (1,902) (2,090) (2,089) (4,179) ----- ------ ------ ------ ------ ------ 7,426 42,078 49,504 12,528 34,682 47,210 (228) 214 (14) (406) 393 (13) ----- ------ ------ ------ ------ ------ 7,198 42,292 49,490 12,122 35,075 47,197 (19) - (19) (20) - (20) ----- ------ ------ ------ ------ ------ 7,179 42,292 49,471 12,102 35,075 47,177 (3,959) - (3,959) (12,310) - (12,310) ------ ------ ------ ------ ------ ------ 3,220 42,292 45,512 (208) 35,075 34,867 ______ ______ _______ ______ ______ ______ 12.45p 73.35p 85.80p 20.96p 60.74p 81.70p 6.85p 21.30p CONSOLIDATED CASH FLOW STATEMENT For the six months ended 30 June 2000 30 June 30 June 31 December 2000 1999 1999 £'000 £'000 £'000 (unaudited) (unaudited) (audited) Cash flow from operating activities 7,301 7,852 13,601 Return on investments and servicing of finance (2,280) (1,284) (3,067) Interest paid (2,280) (1,250) (3,033) Preference dividends paid - (34) (34) Taxation UK tax (paid)/recovered (107) (941) 464 Capital expenditure and financial investment (6,467) (8,519) (33,140) Purchases of investments (59,875) (55,470) (112,857) Sales of investments 53,408 46,951 79,717 Equity dividends paid (8,351) (7,558) (11,517) _____ _____ ______ Cash outflow before management of liquid resources and financing (9,904) (10,450) (33,659) Management of liquid resources Money market deposits withdrawn/(placed) 9,830 (25,548) (2,710) Financing Gross proceeds from issue of debenture stock - 38,000 38,000 Payments on cancellation of preference stocks - (996) (996) ______ ______ ______ (Decrease)/increase in cash (74) 1,006 635 ______ ______ ______ Reconciliation of net cash flow to movement in net debt (Decrease)/increase in cash (74) 1,006 635 Issue of debenture stock - (38,000) (38,000) Non cash movements - 456 456 Cash used to (decrease)/increase liquid resources (9,830) 25,548 2,710 Change in net debt (9,904) (10,990) (34,199) Net debt at 1 January (46,249) (12,050) (12,050) ______ ______ ______ Net debt at 30 June (56,153) (23,040) (46,249) ______ ______ ______ Consolidated summary balance sheet at 30 June 2000 30 June 30 June 31December 2000 1999 1999 £'000 £'000 £'000 (unaudited) (unaudited) (audited) Investments 428,757 405,969 422,261 Net current assets 4,765 36,708 10,130 Amounts falling due after one year (63,000) (63,000) (63,000) _______ _______ _______ Net assets 370,522 379,677 369,391 _______ _______ _______ Attributable to ordinary shareholders 370,522 379,677 369,391 _______ _______ _______ Net asset value per ordinary share: 641.12p 658.25p 639.16p Notes to the interim results 1. Principal activity The principal activity of the Company remains that of an investment trust. The principal activity of its trading subsidiary is investment dealing. 2. Recharges to capital and Accounting policies One half of the management fee and interest payable on the debenture stocks is charged to the revenue account and the other half is charged to capital reserves, net of corporation tax relief, and inclusive of any related irrecoverable value added tax. The unaudited interim financial statements have been prepared on a basis consistent with the statutory financial statements for the year ended 31 December 1999 except for the restatement of the dividends net of related tax credits. This change has been made to comply with the recently issued FRS 16 'Current Tax'. The effect of this change in presentation is to decrease UK dividend income and the tax charge by equal amounts of £774,000 (1999 - Interim £823,000), (1999 - Final £1,416,000). There is no effect on the net income after tax. 3. Dividend The interim dividend of 7.53p (1999, 6.85p) per ordinary share will absorb £4,352,000 and will be paid on 30 September 2000 to shareholders registered on 15 September 2000. 4. Gains on investments 30 June 30 June 31 December 2000 1999 1999 £'000 £'000 £'000 Net realised gains on sales 8,519 10,752 17,138 Net (decrease)/increase in unrealised appreciation (8,468) 32,612 20,305 _____ ______ ______ Gains on investments 51 43,364 37,443 _____ ______ ______ 5. Income 30 June 30 June 31 December 2000 1999 1999 £'000 £'000 £'000 (re-stated) (re-stated) UK dividends net of tax credits 6,963 7,043 12,390 Income from UK fixed interest securities 1,087 727 1,468 Foreign income dividends - 286 286 Scrip dividends 177 - 52 Other special dividends - - 29 Bank interest 331 915 1,632 Underwriting commission - - 13 Dealing profit 108 - - _____ _____ ______ 8,666 8,971 15,870 _____ _____ ______ 6. Comparative figures The information for the year ended 31 December 1999 does not constitute statutory accounts, but has been extracted from the latest published audited accounts, which have been filed with the Registrar of Companies. The report of the auditors on those accounts contained no qualification or statement under section 237(2) or (3) of the Companies Act 1985. 7. Publication This interim report is being sent to shareholders and copies will be made available to the public at the registered office of the Company. 25 July 2000 Contact: Chris Burvill, Investec Investment Management Limited Telephone: 020 7597 2187

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