Final Results

Murray Income Trust PLC 10 September 2002 MURRAY INCOME TRUST PLC PRELIMINARY RESULTS FOR THE YEAR ENDED 30 JUNE 2002 The directors of Murray Income Trust PLC announce the results, subject to final audit, for the year ended 30 June 2002. Key Facts • Murray Income's total return, on a net asset value basis, was -9.9% which compares with the benchmark return of -6.0% and the return on the FTSE All Share Index of -14.8%. • Final dividend of 7.55p per share, making a total of 17.0p, equivalent to an increase of 4.9% on the total dividend paid for 2001. • Balance between interim and final dividends to be changed leading to a significant increase in the level of interim payout. Performance Murray Income's total return, on a net asset value basis, was -9.9% which compares with the benchmark return of -6.0% and the return on the FTSE All Share Index of -14.8%. The fall in the value of the Company's portfolio for the year ended 30 June 2002 was greater than that of the benchmark FTSE 350 Higher Yield Index. This was in part due to investments held in telecommunications and pharmaceuticals that are not represented within the benchmark index. However, the performance was better than the average within the AITC UK Income and Growth sector and the FTSE All Share Index. The bank sector, which has the largest weighting within the portfolio, produced a better than average performance as growth in profits and dividends again exceeded that of the market as a whole. On the other hand, the exposure of the insurance and life assurance sectors to equity markets eroded their balance sheets and this was reflected in a weak price performance. Dividends For the year under review three interim dividends each of 3.15p per share have already been paid on 16th January, 16 April and 16th July 2002. These were unchanged from the previous year. The Board now recommends a final dividend of 7.55p per share, payable on 31 October 2002 to holders of Ordinary shares on the register on 4 October 2002, making a total of 17.0p for the year. For the current year, the Board intends to change the balance between the interim and final dividend payments by increasing the size of the first three interim dividends and proposing a corresponding reduction in the final dividend. We anticipate that the three interim dividends commencing in January, followed by further interims in April and July 2003 will each be at the rate of 4.25p per share. The first interim dividend will be paid on 17 January 2003 to holders of Ordinary shares on the register on 20 December 2002. Strategy and Borrowing Whilst the portfolio continues to be managed with regard to the structure and weightings of the FTSE 350 Higher Yield Index, investments are maintained in a range of stocks and sectors not held within this benchmark. These include pharmaceuticals, food producers and beverages as the Manager believes that companies in these sectors hold prospects of good return. Murray Income began the year with borrowings of £48m, but reflecting the caution of the Manager, almost all of this was repaid shortly afterwards. Since all of this bank debt was short term and flexible no breakage costs were incurred on repayment. Gearing was steadily increased later in the year to take advantage of lower equity prices. At the year end borrowings were £31m. Share Buybacks During the year ended 30 June 2002, the Company repurchased 897,000 Ordinary shares and 21,740 B Ordinary shares (1.28% and 4.39% of the issued Ordinary and B Ordinary shares respectively at 31 October 2001) at an average price of 469.07p per Ordinary share and 585p per B Ordinary share. These repurchases contributed marginally to the Net Asset Value of the remaining Ordinary shares. At the last Annual General Meeting in October 2001 shareholders renewed the authority of the Company to buy back up to 14.99% of its own shares in the market. This authorisation will expire at the Annual General Meeting, to be held in October 2002, at which point shareholders will be asked to renew it. The Board believes that the ability to use the buy-back facility together with improved performance will continue to help narrow the discount to net asset value. Tobacco Resolution Concern was expressed at the last Annual General Meeting by some shareholders about investment in the tobacco sector. The Board has given this matter considerable attention and decided that shareholders should have the opportunity of a formal vote. However, the unanimous opinion of the Board is that the Manager should not be constrained from investing in sectors which it believes are likely to be beneficial to shareholders and fall within the terms of the Company's investment policy. Tobacco stocks have performed particularly well during the recent difficult period for equity markets and the Company would have suffered if these stocks had not been included in the portfolio. The Board therefore recommends shareholders to vote in favour of the resolution. Board Changes It is with regret that on 21 August 2002, the Board accepted the resignation of Roger Adams on the grounds of ill health. The Board wishes to thank him for his wise counsel over the last three years. Outlook The Company's financial year ended with UK equities falling sharply, mirroring similar movements in other major stock markets. The economic background has remained relatively stable compared with the current roller coaster ride being experienced by equities. The US economy continues to progress as expected and growth in the UK is also picking up helped by the significant increase in public expenditure. Equity markets weakness is also likely to delay any increases in short term interest rates. The gearing of the Company has been increased modestly as equity prices have fallen which should benefit shareholders as sentiment towards equities recovers. Looking forward shareholders can expect that the emphasis upon a higher than average yield and the potential to grow dividends should lead to good returns. UK equities now offer good value and this should, in time, be reflected in valuations. MURRAY INCOME TRUST PLC STATEMENT OF TOTAL RETURN (INCORPORATING THE REVENUE ACCOUNT*) for the year ended 30 June 2002 Year ended Year ended 30 June 2002 30 June 2001 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 (Losses) gains on investments - (49,691) (49,691) - 32,037 32,037 Income from investments 15,207 - 15,207 16,706 - 16,706 Other income 177 - 177 102 - 102 Investment management fees (1,324) (1,324) (2,648) (1,375) (1,375) (2,750) Currency (loss) gain - (4) (4) - 198 198 Other expenses (924) (12) (936) (931) - (931) Net return before finance costs and taxation 13,136 (51,031) (37,895) 14,502 30,860 45,362 Finance costs of borrowing (497) (497) (994) (1,573) (1,573) (3,146) Return attributable to equity shareholders 12,639 (51,528) (38,889) 12,929 29,287 42,216 Ordinary dividends on equity shares (11,862) - (11,862) (11,627) - (11,627) Transfer to (from) reserves 777 (51,528) (50,751) 1,302 29,287 30,589 Return per Ordinary share (pence) 18.0 (73.5) (55.5) 17.4 39.5 56.9 Return per Ordinary share assuming full conversion of the B Ordinary shares (pence)** 17.9 (73.2) (55.3) 17.3 39.2 56.5 * The revenue column of this statement is the profit and loss account of the Company. ** The comparative figure for 2001 includes B Ordinary shares in issue at 30 June 2001. No B Ordinary shares were in issue at 30 June 2002 as a result of the conversions during the year. MURRAY INCOME TRUST PLC BALANCE SHEET as at 30 June 2002 As at As at 30 June 2002 30 June 2001 £'000 £'000 £'000 £'000 Fixed assets Investments 415,757 481,121 Current assets Debtors 1,708 1,737 Cash and short term deposits 3,394 7,623 5,102 9,360 Creditors Amounts falling due within one year 9,824 7,336 Net current (liabilities) assets (4,722) 2,024 Total assets less current liabilities 411,035 483,145 Creditors Amounts falling due after more than one year 31,000 48,000 380,035 435,145 Capital and reserves Equity shareholders' interest: Ordinary called up share capital 17,551 17,778 Share premium 7,955 7,955 Capital redemption reserve 4,050 3,820 Capital reserve - realised 304,032 308,657 Capital reserve - unrealised 35,806 87,071 Revenue reserve 10,641 9,864 380,035 435,145 Net Asset Value per Ordinary share (pence)* 541.3 611.9 * The comparative figure for 2001 includes B Ordinary shares in issue at 30 June 2001. At 30 June 2002 there were no B Ordinary shares in issue, following the conversions during the year. MURRAY INCOME TRUST PLC CASH FLOW STATEMENT for the year ended 30 June 2002 Year ended Year ended 30 June 2002 30 June 2001 £'000 £'000 £'000 £'000 Operating activities Investment income received 15,566 17,125 Deposit interest received 168 83 Underwriting commission received 26 - Investment management fees paid (1,692) (2,750) Secretarial fees paid (37) (50) Cash paid to and on behalf of directors (56) (53) Other cash payments (370) (687) Net cash inflow from operating activities 13,605 13,668 Returns on investments and servicing of finance Interest paid (1,097) (3,028) Net cash outflow from returns on investments and servicing of finance (1,097) (3,028) Financial investment Purchase of investments (75,440) (102,144) Sale of investments 91,422 150,760 Net cash inflow from financial investment 15,982 48,616 Equity dividends paid (11,356) (11,974) Net cash inflow before use of financing 17,134 47,282 Financing Repurchase of shares (4,359) (38,535) Net repayment of loans (17,000) (2,049) Net cash outflow from financing (21,359) (40,584) (Decrease) increase in cash (4,225) 6,698 MURRAY INCOME TRUST PLC YEAR ENDED 30 JUNE 2002 2002 2001 Equity shareholders' interest £380,035,000 £435,145,000 Net asset value per Ordinary 541.3p 611.9p share* 2002 2001 Dividends on Ordinary shares £000 £000 Interims of 9.45p (2001 - 9.45p) 2,199 2,410 3.15p paid 16 January 2002 3.15p paid 16 April 2002 2,195 2,247 3.15p paid 16 July 2002 2,195 2,224 Proposed final dividend of 7.55p (2001 - 6.75p) 5,301 4,765 Over accrual of previous year's dividends due to share buybacks (28) (19) 11,862 11,627 * The comparative figure for 2001 includes B Ordinary shares in issue at 30 June 2001. No B Ordinary shares were in issue at 30 June 2002 as a result of the conversions during the year. The results stated above for the year ended 30 June 2001 are abridged from the full accounts for that year, which have received an unqualified report from the auditors and were filed with the Registrar of Companies. A summary of investment changes during the year and the twenty largest investments as at 30 June 2002 are attached. Copies of this announcement will be available to the public at the registered office of the Company at 123 St Vincent Street, Glasgow. The Annual General Meeting will be held on 30 October 2002 at 12.30 p.m. ABERDEEN ASSET MANAGEMENT PLC Secretary 10 September 2002 MURRAY INCOME TRUST PLC SUMMARY OF INVESTMENT CHANGES DURING THE YEAR ENDED 30 JUNE 2002 Valuation Appreciation Valuation 30 June 2001 Transactions (depreciation) 30 June 2002 £'000 % £'000 £'000 £'000 % United Kingdom Equities 481,121 99.6 (15,673) (49,691) 415,757 101.1 Total Investments 481,121 99.6 (15,673) (49,691) 415,757 101.1 Net current assets 2,024 0.4 (6,750) 4 (4,722) (1.1) (liabilities) Total Assets* 483,145 100.0 (22,423) (49,687) 411,035 100.0 * Represents total assets less current liabilities before deducting prior charges Valuation Summary of Net Assets 30 June 2002 £'000 % Equities 415,757 109.4 Net current liabilities (4,722) (1.2) Borrowings (31,000) (8.2) Equity shareholders' interest 380,035 100.0 MURRAY INCOME TRUST PLC TWENTY LARGEST INVESTMENTS as at 30 June 2002 Sector Valuation % of Investment Description £'000 Total assets BP Amoco Oil & Gas 61,044 14.9 HSBC Holdings Banks 31,689 7.7 Shell Transport & Trading Oil & Gas 27,225 6.6 Lloyds TSB Banks 23,704 5.8 Barclays Banks 16,781 4.1 Diageo Beverages 12,780 3.1 Anglo American Mining 10,158 2.5 Sainsbury(J) Food & Drug Retailers 9,379 2.3 Abbey National Banks 9,264 2.2 HBOS Banks 9,230 2.2 Prudential Life Assurance 8,769 2.1 Rio Tinto Mining 8,662 2.1 CGNU (now Aviva) Life Assurance 8,071 2.0 GlaxoSmithKline Pharmaceuticals 7,312 1.8 Standard Chartered Banks 7,280 1.8 Unilever Food Producers & Processors 6,700 1.6 British American Tobacco Tobacco 6,521 1.6 The Royal Bank of Scotland Group Banks *6,040 1.5 Land Securities Real Estate 5,943 1.4 Cadbury Schweppes Food Producers & Processors 5,652 1.4 282,204 68.7 * Holding comprises equity and fixed income securities. This information is provided by RNS The company news service from the London Stock Exchange

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