Interim Results - 6 Months to 30 April 2000

Bankers Investment Trust PLC 22 June 2000 THE BANKERS INVESTMENT TRUST PLC Unaudited Interim Results for the Half Year Ended 30 April 2000 HIGHLIGHTS * Net asset value per share up 9.5% to 346.2p. * Second interim dividend of 1.55p net per ordinary share (1999: 1.49p). Extracts from the Chairman's Statement Assets Net assets per ordinary share increased by 9.5% compared to a rise of 3.4% in the FTSE All- Share Index. Most equity markets surged to new all time peak levels in the first two months of our financial year stimulated by the onset of the new millennium. However, the past six months will be remembered for the massive rise in popularity of technology, media and telephone stocks (TMT) which were eventually driven to unsustainable ratings and since the middle of March have lost a significant part of their rise. Overseas equity markets have generally performed better in sterling terms than the UK where the outlook for corporate profits has been tempered by rising interest rates and the strength of sterling. The UK equity market experienced the greatest mania for TMT stocks which created a bear market in old economy blue chips whilst our new economy stocks were driven to significant premiums relative to their overseas counterparts. In a particularly volatile environment, I am pleased to report that we outperformed the main stock market indices in our four major markets, UK, Europe, USA and Japan. Earnings and Dividends Earnings per share declined by 8.6% influenced by two main factors. First, by a move towards more growth oriented but lower yielding investments overseas. Second, there has also been a slowdown in the rate of dividend increases. The outlook for our total earnings is that they should exceed the minimum forecast total dividend of 6.20p per share, an increase of 3.3% over last year. - 2 - THE BANKERS INVESTMENT TRUST PLC Unaudited Interim Results for the Half Year Ended 30 April 2000 Share Buy-backs We purchased 12,356,000 of our own shares in the first half at a cost of £36.2 million. The shares were bought on an average discount of 16% to net asset value which represents an enhancement of 4.2p per ordinary share to existing shareholders. We renewed the authority to buy back shares at the Annual General Meeting in February and currently have the power to repurchase a further 22.25 million shares. Directors I am delighted to welcome David Thomas to the Board. He has had a long and distinguished career as the Chief Investment Officer of Equitable Life; and has a wealth of experience in global investment. He is very supportive of investment trusts in general and Bankers in particular. Outlook Most developed countries are experiencing economic growth with moderate inflation. Very recently there have been signs of the US economy slowing but it is too early to be sure that the economy is on the Federal Reserve Board's desired path. Further increases in short term interest rates may be necessary before the economy slows down. Apart from Japan, monetary policy may be tightened particularly in the USA, Europe and the UK although the main boost to inflation from the rapid rise in oil prices has probably now been absorbed. Although the near term outlook for corporate profits is favourable and equity markets have become more rational since the puncturing of the TMT bubble, considerable growth expectations remain priced in to fashionable areas of the stockmarket. Many other sectors are far more reasonably valued since the market correction. The world economy is in better shape than for some time. Key to the outlook will be the strength of the US economy and any evidence that interest rates are peaking should reassure stock markets. For further information contact: Michael Moule Vicki Staveacre The Bankers Investment Trust PLC Henderson Press Office Tel: 020 7410 4100 Tel: 020 7410 4028 Stephen Westwood Head of Investment Trusts Tel: 020 7477 5517 - 3 - THE BANKERS INVESTMENT TRUST PLC Unaudited Interim Results for the Half Year Ended 30 April 2000 HIGHLIGHTS 30 April 31 October % Change 2000 1999 Assets Total assets less current £517,464,000 £513,827,000 +0.7 liabilities Net asset value per ordinary 346.2p 316.1p +9.5 share Ordinary share mid-market price 293.0p 273.5p +7.1 Discount (Share Price to Net 15.4% 13.5% Asset Value) Indices FTSE All-Share Index 3,001.92 2,904.38 +3.4 Standard & Poor's Composite 1,452.42 1,362.92 +11.7* Index FT/S&P World Europe (ex UK) 350.43 306.80 +14.2 Index (£) TOPIX (Tokyo First Section 1,648.87 1,563.89 +6.8* Index) FT/S&P World (ex UK) Index (£) 347.03 307.82 +12.7 50/50 FTSE All-Share/ FT/S&P World (ex UK) (£) 216.20 200.00 +8.1 *£ adjusted (Restated+) Half year ended Half year % Change 30 April ended 2000 30 April 1999 Revenue Gross revenue £6,699,000 £7,447,000 -10.0 Earnings per ordinary share 3.29p 3.60p -8.6 +Restated for changes in accounting policies, see note 1 on page 5. - 4 - THE BANKERS INVESTMENT TRUST PLC Unaudited Interim Results for the Half Year Ended 30 April 2000 Group Statement of Total Return (incorporating the revenue account) (Restated*) Half year ended 30 Half year ended 30 April 2000 April 1999 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Total capital gains from - 40,430 40,430 - 77,019 77,019 investments Income from fixed asset 5,909 - 5,909 6,662 - 6,662 investments Other interest receivable 790 - 790 785 - 785 and similar income ------ ------ ------ ------ ------ ------ Gross revenue and capital 6,699 40,430 47,129 7,447 77,019 84,466 gains Management fee (618) (541) (1,159) (567) (496) (1,063) Other administrative (444) - (444) (248) - (248) expenses ------ ------ ------ ------ ------ ------ Net return on ordinary activities 5,637 39,889 45,526 6,632 76,523 83,155 before interest payable and taxation Interest payable (360) (840) (1,200) (370) (862) (1,232) ------ ------ ------ ------ ------ ------ Net return on ordinary activities 5,277 39,049 44,326 6,262 75,661 81,923 before taxation Taxation on net return on (421) 314 (107) (654) 413 (241) ordinary activities ------ ------ ------ ------ ------ ------ Net return on ordinary activities 4,856 39,363 44,219 5,608 76,074 81,682 after taxation Appropriations - Dividends Cumulative preference - - - (25) - (25) stock ------ ------ ------ ------ ------ ------ Available for ordinary 4,856 39,363 44,219 5,583 76,074 81,657 shareholders ------ ------ ------ ------ ------ ------ Dividends - Ordinary shares: Over provision in prior 116 - 116 - - - year 1st interim of 1.55p (2,199) - (2,199) (2,311) - (2,311) (1999: 1.49p) 2nd interim of 1.55p (2,199) - (2,199) (2,311) - (2,311) (1999: 1.49p) ------ ------ ------ ------ ------ ------ (4,282) - (4,282) (4,622) - (4,622) ------ ------ ------ ------ ------ ------ Transfer to reserves 574 39,363 39,937 961 76,074 77,035 ====== ====== ===== ====== ====== ===== Return per ordinary share 3.29p 26.67p 29.96p 3.60p 49.04p 52.64p (Note 2) ====== ====== ===== ====== ====== ===== The revenue columns of this statement represent the revenue accounts of the Group. * Restated for changes in accounting policies, see note 1 on page 5. - 5 - THE BANKERS INVESTMENT TRUST PLC Unaudited Interim Results for the Half Year Ended 30 April 2000 SUMMARY OF GROUP NET ASSETS (Audited) 30 April 30 April 31 2000 1999 October 1999 £'000 £'000 £'000 Valuation of investments 507,915 520,333 493,377 Net current assets 9,549 6,987 20,450 --------- --------- --------- Total assets less current 517,464 527,320 513,827 liabilities Creditors: falling due after more (26,300) (27,861) (26,300) than one year Provision for liabilities and - - (66) charges --------- --------- --------- Total net assets 491,164 499,459 487,461 Cumulative preference stock - (1,430) - --------- --------- --------- Net assets attributable to 491,164 498,029 487,461 ordinary shareholders ====== ====== ====== Number of ordinary shares in issue 141,865,000 155,121,015 154,221,015 Net asset value per ordinary share after deducting prior charges at 346.2p 321.1p 316.1p par NOTES: 1.Changes in Accounting Policies On the basis of the Board's expected long term split of returns between capital gains and income, the Company charges 70% of its interest payable and management fee (insofar as they relate to the maintenance or enhancement of the value of investments) to capital with effect from 1 November 1999. This represents a change in accounting policy from prior periods in which management fee and borrowing costs were charged wholly to revenue. The comparatives for the half year ended 30 April 1999 have been restated accordingly. The effect of this change is that net return on ordinary activities after taxation is increased by £1,067,000 (1999: increased by £945,000). The Company has also adopted Financial Reporting Standard (FRS) 16 'Current Tax' under which UK franked dividend income should be accounted for net of the attributable tax credits. The comparative figures for the half year ended 30 April 1999 have been restated accordingly. The effect of this change is that net return on ordinary activities before taxation is reduced by £473,000 (1999: £558,000). However, there is no effect on the revenue or capital returns per ordinary share, nor on the net asset value per ordinary share. 2.Return per Ordinary Share Revenue return per ordinary share is based on earnings attributable to ordinary shares of £4,856,000 (1999: £5,583,000 as restated), and on the weighted average number of ordinary shares in issue during the period of 147,598,231 (1999: 155,121,015). Capital return per ordinary share is based on net capital gains for the period of £39,363,000 (1999: £76,074,000 as restated), and on the weighted average number of ordinary shares in issue during the period of 147,598,231 (1999: 155,121,015). - 6 - THE BANKERS INVESTMENT TRUST PLC Unaudited Interim Results for the Half Year Ended 30 April 2000 3.Share Buy-Backs During the half year to 30 April 2000, the Company made authorised market purchases for cancellation of 12,356,015 of its own issued ordinary shares of 25p, representing 8.01% of its called up share capital for an aggregate consideration of £36,234,000. 4.Accounts for the year ended 31 October 1999 The figures and financial information for the year ended 31 October 1999 are extracted from the latest published accounts of the Company and do not constitute the statutory accounts for that year. These accounts have been delivered to the Registrar of Companies and included the report of the auditors which was unqualified and did not contain a statement under either Section 237(2) or Section 237(3) of the Companies Act 1985. 5.Dividend The directors have declared a second interim dividend of 1.55p (1999: 1.49p) net per ordinary share payable on 31 August 2000 to shareholders registered on 28 July 2000. The shares will be quoted ex-dividend on 24 July 2000. 6.Interim Report The Interim Report will be posted to shareholders in July and will be available from the Registered Office at 3 Finsbury Avenue, London EC2M 2PA thereafter. - 7 - THE BANKERS INVESTMENT TRUST PLC Unaudited Interim Results for the Half Year Ended 30 April 2000 LARGEST INVESTMENTS AT 30 APRIL 2000 The 50 largest investments (convertibles and all classes of equity in any one company being treated as one investment) were as follows: Market Market value value £'000 £'000 Vodafone AirTouch 15,903 Toshiba 3,408 British 13,467 Oracle Systems 2,994 Telecommunications BP Amoco 12,975 Prudential 2,958 Shell Transport & 12,018 Diageo 2,909 Trading Glaxo Wellcome 11,094 Kyocera 2,885 Philips Electronics 10,516 Pearson 2,874 SmithKline Beecham 5,886 Reuters 2,873 Lloyds TSB 5,778 CGU 2,847 Total Fina 5,637 Tokyo Broadcasting 2,779 Systems Siemens 5,482 Novartis 2,774 Henderson American 5,296 Granada 2,754 Smaller Co's Royal Bank of Scotland 5,282 H.I.S. 2,729 Cable & Wireless 5,102 Nestle 2,717 VNU 4,798 Takefuji 2,704 Barclays 4,598 Tele Danmark 2,704 KPN 4,519 Deutsche Telekom 2,669 HSBC 4,408 Samsung Electronics 2,656 Cisco Systems 4,404 ABN-Amro 2,638 France Telecom 4,261 Citigroup 2,615 AstraZeneca 4,168 US Treasury 3.625% 2,573 (TIPS) 2028 Alcatel 4,155 Abbey National 2,560 General Electric 3,809 ENI 2,546 Marconi 3,687 Richemont 2,488 Telefonos de Mexico 3,458 Slough Estates 2,485 NTT DoCoMo 3,416 Aventis 2,469 These investments total £232,725,000 which represents 45.8% of the portfolio. GEOGRAPHICAL DISTRIBUTION Valuation of Currency exposure investments 30 April 31 30 April 31 2000 October 2000 October % 1999 % 1999 % % UK 51.5 53.0 50.6 51.8 Europe 19.3 17.7 20.6 19.7 USA 15.0 15.0 17.0 17.2 Japan 8.3 8.3 5.7 5.0 Hong Kong 1.1 1.3 1.2 1.3 Other Countries 4.8 4.7 4.9 5.0 100.0 100.0 100.0 100.0

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