Monthly Update

Lindsell Train Investment Trust PLC
18 August 2005


                     The Lindsell Train Investment Trust PLC
                           As at 31st July 2005

Fund Objective

To maximise long-term total returns subject to the avoidance of loss of absolute
value and with a minimum objective to maintain the real purchasing power of
Sterling capital, as measured by the annual average yield on the 2.5%
Consolidated Loan Stock.

Share Price                                                           GBP 125.50
Net Asset Value                                                       GBP 125.97
Premium (Discount)                                                        (0.4%)
Market Capitalisation                                                 GBP 25.1mn
Benchmark (21/2% Con Ann Avg Yield +4.6%)                                   +0.4
Source: Bloomberg; NAV-Lindsell Train. Share Price
quoted is closing mid price. See Benchmark definition.

Performance History (based in     2000   2001      2002       2003          2004                        YTD 2005
GBP)
Net Asset Value %                 n/a    +3.2      -9.6       +3.1         +23.7                         +11.9
Share Price %                     n/a   +18.5     -19.8       -8.7         +20.6                         +26.0

Source: S&P Micropal. Based in GBP. Performance years listed Jan - Dec. Launch
date 22 Jan 2001. With dividends reinvested. *Source: Lindsell Train Ltd.
Past performance is not a guide to future performance. The price of units and
the income from them may go down as well as up. Investors may not get back what
they invested.


2004 Performance  Jan  Feb  Mar  Apr  May  Jun   Jul    Aug      Sep          Oct            Nov              Dec

Net Asset Value % +1.8 +3.3 +0.3 +2.3 -0.1 +2.1 -2.0   +4.8      +3.8        +1.4*          +0.0*            +3.7
Share Price %     -2.3 +6.0 -0.6 +0.6 +2.3 +2.7 +0.5   +0.5      +8.6        +3.0            -1.9            +0.0

Source: S&P Micropal unless otherwise indicated. Based in GBP. Performance years
listed Jan - Dec. Launch date 22 Jan 2001. With dividends reinvested. *Source:
Lindsell Train Limited.

2005 Performance   Jan  Feb  Mar  Apr  May   Jun    Jul     Aug      Sep        Oct           Nov             Dec

Net Asset Value %  +1.4 +0.3 +1.7 +0.8 +3.0  3.0   +1.1      -        -          -             -               -
Share Price %      +8.9 +3.6 -3.5 +1.8 +2.7 +9.6   +0.4      -        -          -             -               -

Source: S&P Micropal unless otherwise indicated. Based in GBP. Performance years
listed Jan - Dec. Launch date 22 Jan 2001. With dividends reinvested. *Source:
Lindsell Train Ltd.

Past performance is not a guide to future performance. The price of units and
the income from them may go down as well as up. Investors may not get back what
they invested.


Industry Breakdown                                             % of NAV
Bonds                                                            24.0
Preference Shares                                                14.2
Equity - Media                                                    8.6
Equity - Banks & Investment Co.                                   4.6
Equity - Leisure & Ent.                                           9.6
Equity - Food & Beverage                                         26.6
Investment Fund                                                  22.7
Cash & Equivalent                                               (10.3)
Total                                                            100.0
Source: Lindsell Train


Top 10 Holdings                                                 % of NAV
US Gov Treasury 6.25%                                             10.9
HBOS 9.25% Non Cum                                                10.8
Barr AG                                                           10.6
Lindsell Train Global Media (Dist)                                9.9
Lindsell Train Japan (Dist)                                       8.6
Cadbury Schweppes                                                 7.8
21/2% Consolidated Loan Stock                                     7.5
Diageo                                                            6.4
Wolverhampton & Dudley Breweries                                  5.8
UK Treasury 2.5%                                                  5.6
Source: Lindsell Train


Fund Exposure         Bonds     Prefs        Equity          Funds              Cash                  % of NAV
UK %                   13.1      14.2         42.3            4.2              (10.4)                   63.4
USA %                  10.9       -            1.5             -                3.7                     16.1
Europe (ex UK) %        -         -            1.8             -               (0.5)                    1.3
Japan %                 -         -            3.8            8.6              (3.1)                    9.3
Global %                -         -             -             9.9                -                      9.9
Total                  24.0      14.2         49.4            22.7             (10.3)                  100.0
Source: Lindsell
Train


Fund Manager's Comments

July was an unhelpful month for your NAV, with the reversal of two trends that
assisted for the first six months of the year - namely the rally of the US
Dollar against Sterling and the bull market in long-dated Anglo-Saxon government
bonds. Moreover, the continued gains in oil and hard commodity prices have
become a negative for your Company. Understandably, investors have begun to see
these increases as de facto tax hikes for global consumers and, as a result,
many 'non-commodity' company share prices have been drifting, even relatively
insulated businesses, such as our favourites, Cadbury and Diageo.

We think it unlikely, however, that all these three headwinds will be sustained
against us indefinitely and may already be turning. In particular, we expect
that any continued spiral in the oil price really will hit consumer confidence
worldwide and lead to a further sharp decline in inflation expectations,
boosting government bond prices. The recent, for many unanticipated, cut in UK
short interest rates seems to point to such an outcome.

UK base rate reductions are very interesting for your Company. First, they are
immediately value-creating. The Trust is moderately levered, at c 10.0% and the
debt is bank borrowing, paid at floating rates. Any drop in the cost of
borrowing increases the amount of income we earn from the investment portfolio,
albeit modestly in this instance. Next, the cut in interest rates leaves the
yields available on gilts and, particularly, preference shares looking even more
attractive to income-seeking institutions and private investors. All our fixed
interest assets have bounced in price in early August, after the rate cut and we
hope for more. Finally, the cut is a signal that the long British consumer boom
is waning. With falling house prices and a deteriorating fiscal outlook we think
that further rate reductions and a wobbly Sterling look plausible. An end to the
recent rally in Sterling would certainly help the NAV. A final thought - if UK
house price deflation proves contagious - and US real estate values look
distinctly bubble-like to many, including Alan Greenspan - then the world might
really begin to look rather different, as deflationary forces kick in, with
serious implications for the pricing of bonds, currencies, equities and, of
course, commodities.

We've been wallflowers to the commodity price boom, watching on with a mixture
of envy and incomprehension as smarter people than us have made big money in
assets that we regard as excessively speculative (and that description includes
several FTSE 100 constituents). We remember some of our earliest lessons in
investment management - 'A mine is a hole in the ground with a liar at the top'
or 'The most dangerous phrase in our business is 'It's different this time'' -
because these lessons have served us well over the years and because they remain
relevant. It is uncanny for us to read the 'new era' justifications for, say,
companies benefiting from soaring steel prices so relatively soon after the
scuppering of similar Dotcom fantasies (justifications often from the selfsame
broker cheerleaders for technology). Hot-rolled steel prices peaked in September
2004 at $756 per ton, today it fetches c$400 - what is your guess for next
month?

That question leads to our two prime objections to investing in commodity
sectors. First, we have always been reluctant to commit to industries or
companies whose long term success is tied to commodity prices, because they are,
we think, essentially unpredictable. We have a view as to what may happen to the
inflation-adjusted price of a bottle of Johnnie Walker Black Label over the next
decade - we think it will maintain, or possibly modestly increase its real
value, but we have no idea what steel or a barrel of oil will fetch in 2006, let
alone 2015 (though we have a suspicion that by the latter date the real price of
metals and oil will have fallen, as it did for much of the Twentieth Century,
when increased supply soon swamped cyclical demand for commodities). Next, we
also stick to perhaps a simplistic view- that if commodity prices are rising,
then it is likely that economic growth is accelerating above expectation in some
part of the global economy. If so, then we believe we can invest in far more
attractive business models, with higher intrinsic returns to equity and better
cash generation than (typically) capital-hungry extractive companies.

Here are two instances of such attractive models which we own and which offer
access to accelerating economic growth. We have, first, been mildly disappointed
that Diageo's price has fallen 6.0% since early July, as investors digested a
pre-close period trading statement that reaffirmed forecasts, but failed to lead
to profit upgrades. We think investors are missing the future growth
implications of the fact that Diageo today earns 29.0% of its EBIT from the
emerging economies of Latin America, Asia and Africa, where it often has market-
leading positions (and, meanwhile, only 2.0% of its EBIT derives from the
world's 'problem' economies of France and Germany). In the long run, we see the
economic returns to Diageo of delivering increasing volumes of Johnnie Walker to
China or India as being far more attractive than, say, Corus or Xstrata's
opportunity to deliver steel or coal to the same regions. Reuters' shares too
have fallen in July, despite the company's win of a significant contract from
the People's Bank of China to establish a foreign currency trading portal. The
China Foreign Exchange Trade System (CFETS) is the only organisation licensed to
trade forex in China and is based on a version of Reuters' existing electronic
trading platform, situated in Shanghai. The portal is likely to be central to
the development of a domestic forex market in China and gives Reuters a real
chance of dominating this trade. Reuters ' profitability from its provision of
currency trading platforms is already exceptional and arguably, the most
valuable franchise within the group - the promise of drawing the China currency
bloc into its sway is not in the stock price, we believe. The only consolation
from the recent share price fall for a long term investor in Reuters is that it
means that the £1.0 billion share buyback the company announced with its interim
results, now shrinks the equity base by 20.0%, meaning that there is even more
growth to share around the remaining holders.




Fund Manager                            Launch Date                             Denomination
Nick Train                              22 Jan 2001                             GBP
Year End                                Dividend                                Benchmark
31st Mar                                Ex Date: June                           The annual average yield on the 21/2%
                                        Payment: August                         Consolidated Loan Stock.
The Board                               Management Fees                         Registered Address
Rhoddy Swire                            Standard Fee: 0.65%                     Lindsell Train Investment Trust
Michael Mackenzie                       Performance Fee: 10% of annual increase 77A High Street
Donald Adamson                          in the share price, plus dividend,      Brentwood
                                        above the gross annual yield of the 2   ESSEX  CM14 4RR
                                        1/2% Consolidated Loan Stock.
ISIN                                    Bloomberg                               Listing
GB0031977944                            LTI LN                                  London Stock Exchange

Disclaimer

This document is intended for use by persons who are authorised by the UK
Financial Services Authority ('FSA') and those who are permitted to receive such
information in the UK. The information contained in this document does not
constitute an offer or invitation to buy or sell any investments. Nothing in
this document constitutes investment, legal, tax or other advice. Lindsell Train
and/or persons connected with it may have an interest in this investment.

The value of any investment in securities or funds and the income generated from
them may go down as well as up and are not guaranteed. Past performance cannot
be used as a guide or guarantee of future performance. You may not get back the
original amount you have invested. Changes in foreign exchange rates may cause
the value of your investment to go up or down. Some funds with higher gearing
may be subject to higher volatility and the investment value may change
substantially. The net asset value (NAV) performance of an investment trust is
not the same as its market share price performance.

Issued by Lindsell Train Limited
Authorised and regulated by the Financial Services Authority
18 Aug 2005 LTL 000-028-9b

                                                Lindsell Train Limited
                                          35 Thurloe Street, London  SW7 2LQ
                                     Tel. [phone]  Fax. [phone]
                                   [e-mail]  www.lindselltrain.com
                Lindsell Train Limited is authorised and regulated by the Financial Services Authority.



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