Interim Results
Murray Income Trust PLC
Results for the six months ended 31 December 2004
The Directors of Murray Income Trust PLC report the unaudited interim results
for the six months ended 31 December 2004.
Key Facts
- Murray Income's Net Asset Value total return was 13.2 %.
- Share price rose from 439.8p to 496.3p
- Second interim dividend of 4.5p will be paid on 15 April 2005.
Performance
UK share prices again produced a positive performance during the six months to
31 December 2004, ending the year at their highest level for over two years.
This six month period was the first following the decision to change the
Company's benchmark to the FTSE All-Share Index, and has produced an encouraging
start. The Net Asset Value total return for the six months to 31 December was
13.2%, compared with 9.7% from the FTSE All-Share Index.
Background
After some nervousness at the start of the period, UK share prices subsequently
rose steadily. Looking at the economic background, there was only a single
increase in short term interest rates, by 0.25% to 4.75%, but what was more
important was a shift in investor perception towards future interest rate
changes. Many commentators now believe that the cycle of increasing interest
rates is either at, or very close to, the peak. Previously the consensus view
had been that a series of interest rate increases was to be expected. Although
the momentum in the economy slowed, growth in GDP remains above trend levels and
unemployment remains low. With housing transactions and new mortgage approvals
falling, the housing market has clearly slowed.
Activity
At the beginning of the Company's financial year, the portfolio was restructured
to increase the emphasis on the management of absolute return and decrease the
emphasis on the benchmark. Over the six months, three new holdings were
established: BBA, the aviation services and materials technology business; First
Choice, the leisure travel operator; and Mothercare, the high street retailer.
Reductions were made in the holdings of BP and HSBC, while three companies were
sold in their entirety, being Abbey National, United Utilities and Kingfisher.
In contrast to the previous period, almost 800,000 of the Company's own shares
were purchased for cancellation over the six months. Since these were in all
cases purchased at a discount to their Asset Value, the Asset Value of the
remaining shares was modestly enhanced.
Gearing
The Manager has continued to manage the Company's gearing actively as the bank
facilities are flexible and can be repaid quickly without any additional costs.
The Company also renegotiated its bank facilities into a single agreement and was able to
secure a reduction in the cost.
Investment Management
Ross Watson and Gary McAleese have been responsible for the investment
management of the Company. Ross Watson has recently accepted another
appointment within the industry and Anne Richards and Gary McAleese will now be
responsible for the Company's investment management.
Dividend
A first interim dividend of 4.5p was paid on 17 January 2005 to holders of
Ordinary shares on the register at close of business on 17 December 2004. A
second interim dividend of 4.5p will be paid on 15 April 2005 to holders of
Ordinary shares on the register at close of business on 18 March 2005. The third
interim dividend of 4.5p will be paid on 15 July 2005 to holders of Ordinary
shares on the register at close of business on 17 June 2005.
Although these interim dividends show no increase on those paid in the year to
June 2004, the underlying revenue stream from the portfolio remains strong.
This, together with the revenue reserves, mean that the Directors expect to be
able to recommend an increase in the final dividend.
Outlook
The growth of the economy may be slower than last year, but should still be
around the trend level of 2.5%. Short term interest rates are not expected to
rise much further, as the slowdown in the housing market shows that past
increases have had the desired effect. Although share prices have risen in
recent months, the prospect of further growth in corporate profits means that
the valuation of the UK stock market remains relatively attractive.
MURRAY INCOME TRUST PLC
STATEMENT OF TOTAL RETURN
(INCORPORATING THE REVENUE ACCOUNT)
Six months to 31
December 2004
(unaudited)
Revenue Capital Total
£'000 £'000 £'000
Realised gains/(losses) on - 8,293 8,293
investments
Unrealised gains - 31,907 31,907
_______ ______ ______
Gains on investments - 40,200 40,200
Income from investments 6,329 - 6,329
Other income 98 - 98
Investment management fees (634) (634) (1,268)
Other expenses (404) - (404)
_______ ______ ______
Net return before finance costs and 5,389 39,566 44,955
taxation
Finance costs of borrowing (342) (342) (684)
_______ ______ ______
Return attributable to equity 5,047 39,224 44,271
shareholders
Ordinary dividends on equity shares (6,157) - (6,157)
_______ ______ ______
Transfer (from) /to reserves (1,110) 39,224 38,114
_______ ______ ______
Return per Ordinary share (pence) 7.3 56.9 64.2
_______ ______ ______
Notes:
1. The revenue column of this statement is the profit and loss account of the
company.
2. The financial information for the six months ended 31 December 2004 and 31
December 2003 comprises non-statutory accounts within the meaning of Section
240 of the Companies Act 1985. The financial information for the year ended
30 June 2004 has been abridged from published accounts that have been
delivered to the Registrar of Companies and on which the report of the
Auditors was unqualified. The interim accounts have been prepared on the same
basis as the annual accounts.
MURRAY INCOME TRUST PLC
STATEMENT OF TOTAL RETURN
(INCORPORATING THE REVENUE ACCOUNT)
Six months to 31 December 2003
(unaudited)
Revenue Capital Total
£'000 £'000 £'000
Realised losses on investments - (729) (729)
Unrealised gains - 38,732 38,732
_______ _______ ______
Gains on investments - 38,003 38,003
Income from investments 7,637 - 7,637
Other income 57 - 57
Investment management fees (620) (620) (1,240)
Other expenses (462) - (462)
_______ _______ ______
Net return before finance costs and 6,612 37,383 43,995
taxation
Finance costs of borrowing (400) (389) (789)
_______ _______ ______
Return attributable to equity 6,212 36,994 43,206
shareholders
Ordinary dividends on equity shares (6,318) - (6,318)
_______ _______ ______
Transfer (from) /to reserves (106) 36,994 36,888
_______ _______ ______
Return per Ordinary share (pence) 8.8 52.7 61.5
_______ _______ ______
MURRAY INCOME TRUST PLC
STATEMENT OF TOTAL RETURN
(INCORPORATING THE REVENUE ACCOUNT)
Year ended 30 June 2004
(audited)
Revenue Capital Total
£'000 £'000 £'000
Realised gains on investments - 2,228 2,228
Unrealised gains - 42,279 42,279
_______ _______ _______
Gains on investments - 44,507 44,507
Income from investments 16,736 - 16,736
Other income 91 - 91
Investment management fees (1,254) (1,254) (2,508)
Other expenses (972) - (972)
_______ _______ _______
Net return before finance costs and 14,601 43,253 57,854
taxation
Finance costs of borrowing (858) (858) (1,716)
_______ _______ _______
Return attributable to equity 13,743 42,395 56,138
Shareholders
Ordinary dividends on equity shares (12,755) - (12,755)
_______ _______ _______
Transfer to reserves 988 42,395 43,383
_______ _______ _______
Return per Ordinary share (pence) 19.6 60.5 80.1
_______ _______ _______
MURRAY INCOME TRUST PLC
BALANCE SHEET
31 31 30
December December June
2004 2003 2004
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Fixed assets
Investments 401,950 385,191 390,004
Current assets
Debtors 959 1,183 1,716
Cash and overnight deposits 3,399 2,164 239
_______ _______ _______
4,358 3,347 1,955
Creditors
Amounts falling due within one (6,517) (37,121) (36,821)
year
_______ _______ _______
Net current liabilities (2,159) (33,774) (34,866)
_______ _______ _______
Total assets less current 399,791 351,417 355,138
liabilities
Creditors
Amounts falling due after more (20,000) (10,000) (10,000)
than one year
_______ _______ _______
Net assets 379,791 341,417 345,138
_______ _______ _______
Capital and reserves
Ordinary called up share 17,192 17,551 17,391
capital
Share premium account 7,955 7,955 7,955
Capital redemption reserve 4,410 4,050 4,210
Capital reserve - realised 266,093 264,737 262,238
Capital reserve - unrealised 72,962 35,929 41,055
Revenue reserve 11,179 11,195 12,289
_______ _______ _______
Equity Shareholders' funds 379,791 341,417 345,138
_______ _______ _______
Net Asset Value per Ordinary 552.3 486.3 496.2
share (pence)
_______ _______ _______
MURRAY INCOME TRUST PLC
CASH FLOW STATEMENT
Six months to Six months to Year ended
31 December 31 December 30 June
2004 2003 2004
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Operating activities
Investment income received 7,110 7,515 16,056
Deposit interest received 99 51 88
Underwriting commission received - 4 4
Investment management fees paid (1,264) (876) (2,498)
Secretarial fees paid (25) (25) (50)
Cash paid to and on behalf of Directors (39) (30) (72)
Other cash payments (375) (455) (951)
_______ _______ _______
Net cash inflow from operating 5,506 6,184 12,577
activities
Servicing of finance
Bank and loan Interest paid (708) (722) (1,666)
_______ _______ _______
Net cash outflow from servicing of (708) (722) (1,666)
finance
Financial investment
Purchases of investments (59,227) (37,467) (51,348)
Sales of investments 87,458 31,012 46,605
_______ _______ _______
Net cash inflow/(outflow) from financial 28,231 (6,455) (4,743)
investment
Equity dividends paid (6,408) (6,494) (12,809)
Management of liquid resources
Cash (placed) /drawn on short-term (3,045) 2,155 3,478
deposit
_______ _______ _______
Net cash inflow/(outflow) from
management of liquid resources (3,045) 2,155 3,478
_______ _______ _______
Net cash outflow before financing 23,576 (5,332) (3,163)
Financing
Repurchase of shares (3,461) - (2,772)
(Repayment)/drawdown of loans (20,000) 5,000 5,000
_______ _______ _______
Net cash inflow/(outflow)/inflow from (23,461) 5,000 2,228
financing
_______ _______ _______
Increase/(decrease) in cash 115 (332) (935)
_______ _______ _______
Note 1
The issued Ordinary share capital as at 31 December 2004 was 68,767,046 Ordinary
Shares of 25p each. Since 31 December 2004, 309,588 Ordinary Shares have been
bought back and the Ordinary share capital at 8 February 2005 is 68,457,458
Ordinary shares.
Note 2
6 months to Year to
31/12/04 31/12/03 30/06/04
£'000 £'000 £'000
Dividends on ordinary shares
First interim-4.5p paid on 17.1.05 (2004 3,095 3,159 3,159
- 4.5p)
Second interim-4.5p payable on 15.4.05 3,095 3,159 3,157
(2004 - 4.5p)
Third interim (2004 - 4.5p) - - 3,135
Final dividend (2004 - 4.75p) - - 3,304
Over accrual due to share buybacks (33) - -
_______ _______ _______
6,157 6,318 12,755
_______ _______ _______
Note 3
A summary of investment changes during the period and the twenty largest
investments at 31 December 2004 are attached.
By order of the Board
ABERDEEN ASSET MANAGEMENT PLC, SECRETARY
8 February 2005
Copies of this announcement will be printed and issued to shareholders and will
be available to the public at the registered office of the Company, 123 St
Vincent Street, Glasgow.
MURRAY INCOME TRUST PLC
SUMMARY OF INVESTMENT CHANGES
DURING THE PERIOD TO 31 DECEMBER 2004
Valuation Valuation
30 June Appreciation/ 31 December
2004 Transactions (depreciation) 2004
£'000 % £'000 £'000 £'000 %
United Kingdom
Equities 390,004 101.3 (28,253) 40,199 401,950 100.5
_______ _____ _______ _______ _______ _____
Total investments 390,004 101.3 (28,253) 40,199 401,950 100.5
Net liabilities (4,866) (1.3) 2,707 - (2,159) (0.5)
excluding borrowings _______ ______ _______ _______ _______ _____
Total assets 385,138 100.0 (25,546) 40,199 399,791 100.0
_______ _____ _______ _______ _______ _____
Valuation
Summary of net assets 31 December
2004
£'000 %
Equities 401,950 105.8
Net liabilities (2,159) (0.5)
excluding borrowings
Borrowings (20,000) (5.3)
_______ _____
Equity Shareholders' 379,791 100.0
interest _______ _____
MURRAY INCOME TRUST PLC
TWENTY LARGEST INVESTMENTS
as at 31 December 2004
Investment Sector description Valuation % of Total
£'000 Assets
BP Oil & Gas 29,667 7.4
Shell Transport & Trading Oil & Gas 26,374 6.6
HSBC Holdings Banks 23,953 6.0
Barclays Banks 17,627 4.4
Lloyds TSB Banks 15,893 4.0
Royal Bank of Scotland Banks 15,663 3.9
Aviva Life Assurance 15,260 3.8
Great Universal Stores General Retailers 12,987 3.2
Diageo Beverages 11,145 2.8
Slough Estates Real Estate 10,945 2.7
GlaxoSmithKline Pharmaceuticals 10,713 2.7
HBOS Banks 10,642 2.7
British American Tobacco Tobacco 10,283 2.6
Anglo American Mining 9,499 2.4
BBA Group Transport 7,646 1.9
Unilever Food Producers & 7,572 1.9
Processors
Standard Chartered Banks 7,071 1.8
Wolverhampton & Dudley Leisure & Hotels 6,863 1.7
Breweries
Land Securities Real Estate 6,337 1.6
Weir Group Engineering & 6,239 1.6
Machinery
_________ _____
262,379 65.7
_________ _____
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