Final Results

CITY OF LONDON INVESTMENT TRUST PLC 6 September 1999 Unaudited Preliminary Results for the year ended 30 June 1999 Highlights - Net asset value total return per share of 10.5% (FTSE All-Share: 10.0%)* - Net dividend per share up 3.6% to 6.94p - Forecast net dividend for 1999/2000 up 2.6% to 7.12p * Source: AITC Services Limited Performance The UK equity market staged a strong recovery from its low point last autumn. With base rates being cut from 7.5% to 5%, the UK economy has avoided a recession and confidence in future growth has improved. Since the start of 1999, companies sensitive to economic growth have, in general, done better than the highly rated telecommunication and pharmaceutical stocks. In the year to 30 June 1999, the Company's net asset value total return was 10.5% which was slightly better than that of the FTSE All-Share Index. The board places particular emphasis on long-term performance and notes that the Company has outperformed the FTSE All-Share Index over five, ten and twenty years. The Association of Investment Trust Companies statistics start at 31 December 1967. From this date, £100 invested in the net assets of the Company would have produced a total return, including the reinvestment of net dividends, by 30 June 1999 of £7,106 which compares with £6,744 for the FTSE All-Share Index. Dividends A fourth interim dividend of 1.78p was paid on 31 August 1999, making a total net dividend for the year of 6.94p. This increase of 3.6% over the previous year continued the Company's unbroken record of annual dividend increases since 1966. The board is forecasting a 2.6% increase in the Company's total net dividend to 7.12p, payable at the new quarterly rate of 1.78p. UNAUDITED PRELIMINARY RESULTS FOR THE YEAR ENDED 30 JUNE 1999 Expenses Expenses continued under tight control and, excluding interest but including the proportion of the management fee which is charged to capital, were less than 0.4% of assets under management. Share Buy-Backs An investment trust company can increase its net asset value per share by purchasing its own shares if they are at a discount to their net asset value. Although the Company's shares have traded at only a small discount over the last year, the board believes that it would be useful to have the power to buy back up to 14.99% of the Company's issued ordinary share capital to take advantage of possible future opportunities and a resolution to this effect will be put to the forthcoming Annual General Meeting. AITC Marketing Campaign The Company is participating in the Association of Investment Trust Companies (AITC) marketing campaign which aims to bring the merits of investment trusts to the attention of the public. Prospects Growth in the UK economy is expected to recover and return to its long-run trend in 2000. Despite the adverse effect for some companies of the continued strength of sterling against the euro, in general profits growth should be healthy. The overall climate remains one of low inflation with the Bank of England enhancing the credibility of monetary policy relative to political control in the past. Although the valuation of the UK equity market is more reasonable than most other leading international equity markets, it could be vulnerable to a general setback in international equity markets. Therefore the Company's gearing was reduced to 4%, which compares with 8% a year ago and 11% two years ago. Unaudited Preliminary Results for the year ended 30 June 1999 Statement of Total Return (incorporating the Revenue Account) Year ended 30 June 1999 Year ended 30 June 1998 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Total capital gains from - 43,426 43,426 - 117,949 117,949 investments Income from fixed asset 21,484 - 21,484 21,770 - 21,770 investments Other interest receivable 330 - 330 507 - 507 and similar income ------- ------- ------- ------- ------- ------- Gross revenue and capital 21,814 43,426 65,240 22,277 117,949 140,226 gains Management fee (1,313) (656) (1,969) (1,119) (560) (1,679) Other administrative (325) - (325) (296) - (296) expenses ------- ------- ------- ------- ------- ------- --- ---- --- --- --- --- Net return on ordinary activities before interest 20,176 42,770 62,946 20,862 117,389 138,251 payable and taxation Interest payable (2,142) (2,142) (4,284) (2,136) (2,136) (4,272) ------- ------- --- ------- ------- ------- Net return on ordinary activities before taxation 18,034 40,628 58,662 18,726 115,253 133,979 Taxation on net return on (2,473) 110 (2,363) (3,432) 81 (3,351) ordinary activities ------- ------- ------- ------- ------- ------- Net return on ordinary activities after taxation 15,561 40,738 56,299 15,294 115,334 130,628 Dividends : Preference and preferred (168) - (168) (145) - (145) ordinary stocks ------- ------- ------- ------- ------- ------- Net return attributable 15,393 40,738 56,131 15,149 115,334 130,483 to the ordinary shares ------- ------- ------- ------- ------- ------- Dividends: Ordinary shares Three interim payments of (10,855) - (10,855) (10,375) - (10,375) 1.72p (1998: 1.66p) Fourth interim payment of (3,748) - (3,748) (3,611) - (3,611) 1.78p (1998: 1.72p) ------- ------- ------- ------- ------- ------- (14,603) - (14,603)(13,986) - (13,986) ------- ------- ------- ------- ------- ------- Transfer to reserves 790 40,738 41,528 1,163 115,334 116,497 ====== ====== ====== ====== ====== ====== Return per ordinary share 7.32p 19.36p 26.68p 7.27p 55.38p 62.65p (note 1) ====== ====== ====== ====== ====== ====== The revenue columns of this statement represent the revenue accounts of the Company. Unaudited Preliminary Results for the year ended 30 June 1999 Summary of Net Assets (Audited) 30 June 1999 30 June 1998 £'000 £'000 Investments at market value 610,051 588,616 Shares in subsidiary undertakings 347 347 ------- ------- 610,398 588,963 Net current assets 24,030 1,839 ------- ------- Total assets less current 634,428 590,802 liabilities Creditors: amounts falling due after more than one year - debenture stocks (46,000) (46,000) -------- -------- Total net assets 588,428 544,802 Preference and preferred ordinary (2,086) (2,086) stocks -------- ------- Total net assets attributable to the 586,342 542,716 ordinary shares ======== ======= Number of ordinary shares in issue 210,553,142 209,723,170 Net asset value per ordinary share, after deducting prior charges at par 278.48p 258.78p Notes : 1. Return per ordinary share Revenue return per ordinary share is based on earnings attributable to the ordinary shares of £15,393,000 (1998: £15,149,000) and on the weighted average number of ordinary shares in issue during the year of 210,350,386 (1998: 208,275,738). Capital return per ordinary share is based on net capital gains for the year of £40,738,000 (1998: £115,334,000) and on the weighted average number of ordinary shares in issue during the year of 210,350,386 (1998: 208,275,738). 2. Preliminary Figures The preliminary figures for the year ended 30 June 1999 have been extracted from the latest accounts and do not constitute statutory accounts as defined by section 240 of the Companies Act 1985. These accounts have not yet been delivered to the Registrar of Companies, nor have the auditors yet reported on them. Unaudited Preliminary Results for the year ended 30 June 1999 3. Accounts for the year ended 30 June 1998 The figures and financial information for the year ended 30 June 1998 are an extract of the latest published accounts and do not constitute the statutory accounts for that year. Those 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. 4. Annual Report The full annual report and accounts will be posted to shareholders in late September 1999 and copies will be available from the Secretary at the Company's Registered Office, 3 Finsbury Avenue, London EC2M 2PA. The Annual General Meeting will be held on 4 November 1999. Unaudited Preliminary Results for the year ended 30 June 1999 The 40 largest equity investments (convertibles and all classes of equity in any one company being treated as one investment) were as follows : Valuation Valuatio at n at 30 June 30 June 1999 1999 £'000 £'000 British 31,890 Cable & Wireless 7,277 Telecommunications Shell Transport & 28,069 Railtrack 6,485 Trading BP Amoco 27,288 Land Securities 6,398 HSBC 25,829 Rio Tinto 6,381 Lloyds TSB 22,360 Bass 6,164 Glaxo Wellcome 22,038 Allied Zurich 5,981 National 13,450 Whitbread 5,898 Westminster Bank of Scotland 12,600 Tesco 5,877 CGU 12,524 BG 5,813 Barclays 11,538 Granada 5,689 GKN 10,830 Scottish Power 5,480 Vodafone AirTouch 10,625 Royal & Sun 5,173 Alliance Diageo 9,938 Royal Bank of 5,168 Scotland SmithKline Beecham 9,894 Pearson 5,156 Abbey National 9,528 Reuters 5,007 Prudential 9,340 Cadbury Schweppes 4,848 General Electric 9,058 Unilever 4,798 Legal & General 8,075 Marks & Spencer 4,771 AstraZeneca 7,853 P & O 4,762 British American 7,456 EMI 4,708 Tobacco These investments total £412.0 million or 65% of the portfolio. For further information please contact : Job Curtis Portfolio Manager The City of London Investment Trust plc Telephone: 0171 410 4367 James Henderson or Vicki Staveacre Deputy Portfolio Manager Henderson Investors The City of London Investment Trust plc The Press Office Telephone: 0171 410 4370 Telephone: 0171 410 4222 Issued by The City of London Investment Trust plc

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