Interim Results

Edinburgh US Tracker Trust plc 14 September 2005 FINAL NEWS RELEASE 14 September 2005 EDINBURGH US TRACKER TRUST PLC Edinburgh US Tracker Trust aims to achieve long term growth of capital and income by tracking the performance of the S&P Composite Index. Edinburgh US Tracker Trust is the only UK investment trust with the objective of tracking the performance of the S&P Composite Index. INTERIM RESULTS FOR THE SIX MONTHS TO 31 JULY 2005 • Net asset value per share rose by 12.0% compared to a rise in the S&P Composite Index of 11.9% • Interim dividend increased to 2.30p per share. • Share price rose by 13.9% - END - For further information, please contact:- David McCraw Edinburgh Fund Managers plc 0131 313 1000 Ian Massie Edinburgh Fund Managers plc 0131 313 1000 CHAIRMAN'S STATEMENT The company continues to meet the objective of tracking the performance of the S &P 500 Composite Index. In the six months ended 31 July 2005, the net asset value per share (NAV) rose by 12.0% to 583.70p which compares with an increase of 11.9% in the index (in sterling terms). The company's share price rose by 13.9% over the period to a half year end price of 552.5p which represented a discount of 5.3% to the net asset value. At the start of the new financial year, the share price was standing at a discount of 7.0%. The company bought back 972,000 shares for cancellation during the period at a cost of £4.8 million, enhancing the NAV for continuing shareholders by 0.37p. US equity markets produced modest gains in the first half of the year. Corporate profits were ahead of expectations but investors remained cautious about the impact of higher oil prices on economic activity and the continuing rise in US interest rates. The Federal Reserve increased short term interest rates on five occasions to combat inflationary pressures and by the beginning of August the Fed Funds Rate stood at 3.5%. Over the period, the US dollar/sterling exchange rate rose from $1.89 to $1.76 which translated the rise of 4.5% in the S&P Composite Index in US currency to 11.9% in sterling. The revenue return per share, compared to the six months to 31 July 2004, rose by 26.3% to 3.03p benefiting from dividend increases from underlying investments and a recovery in the US dollar. The directors have therefore increased the interim dividend by 15.0% to 2.30p per share for the year to 31 January 2006 payable on 21 October 2005 to shareholders on the register on 23 September 2005. The level of activity within the portfolio was slightly higher than in recent periods. This was attributable to the rebalancing of the portfolio to reflect the weights of the index constituents being amended to reflect the free float of shares to investors. The costs of the rebalancing of the portfolio were kept to a minimum and had limited impact on the net asset value of the company. This is a two-stage process which will be completed in September 2005. The financial statements, and the net asset value per share figures quoted above, have been prepared in accordance with UK Generally Accepted Accounting Principles (UK GAAP). The new Financial Reporting Standards, issued as part of the programme to converge UK GAAP with International Financial Reporting Standards (IFRS), were applicable for the accounting period to 31 July 2005 and the financial statements for the six months ended 31 July 2004 and the twelve months ended 31 January 2005 have also been restated. The main change arising from these revisions to UK GAAP, in relation to the company's financial statements, is that dividends to shareholders declared after the balance sheet date are now shown in the period of payment rather than in the reporting period. This change has increased the NAV as at 31 January 2005 from 518.26p to 521.31p. The changes to the constituents of the index in the period were the result of takeover activity. Constellation Brands, National Oilwell Varco, D R Horton and Weatherford International were added to the index and replaced Power-One, Veritas Software, Great Lakes Chemical and Toys R US. The total value of purchases amounted to £7.2 million while sales totaled £11.5 million. Edinburgh US Tracker Trust is the only UK investment trust to track the performance of the S&P Composite Index and provides shareholders with a broadly diversified portfolio which covers the top 500 companies in the USA. The method employed by the company to track the index involves a full replication of the index constituents. This means that the company's portfolio holds every stock making up the index in an amount which corresponds to the stock's proportionate weight in the index. A generally favourable economic background has been reflected in better than expected corporate profits through the second quarter of the year. The US economy, however, is now having to withstand the pressure of higher oil prices and higher interest rates as well as the impact of the recent hurricane. It is too early to assess the full economic effect but the direction of oil prices and interest rates will also remain key influences on future returns in financial markets. Sir Angus Grossart, Chairman STATEMENT OF TOTAL RETURN for the six months to 31 July 2005 (unaudited) Revenue Capital Total £000 £000 £000 Gains/(losses) on investments - 50,938 50,938 Income from investments 4,099 - 4,099 Interest receivable 83 - 83 Investment management fee (448) - (448) Administrative expenses (145) - (145) _________ _________ _________ Return on ordinary activities before taxation 3,589 50,938 54,527 Taxation (1,083) - (1,083) _________ _________ _________ Return on ordinary activities after taxation 2,506 50,938 53,444 _________ _________ _________ Return per share (p) 64.74p _________ The total column of this statement represents the profit and loss account of the company. All items in the above statement derive from continuing operations. Interim Dividend An interim dividend of 2.3p per share (£1,885,000) is declared for the year to 31 January 2006 and is payable on 21 October 2005. __________________________________________________________________________________ STATEMENT OF TOTAL RETURN for the six months to 31 July 2004 (unaudited) (restated) Revenue Capital Total £000 £000 £000 Gains/(losses) on investments - (10,804) (10,804) Income from investments 3,744 - 3,744 Interest receivable 43 - 43 Investment management fee (447) - (447) Administrative expenses (200) - (200) _________ _________ _________ Return on ordinary activities before taxation 3,140 (10,804) (7,664) Taxation (1,018) - (1,018) _________ _________ _________ Return on ordinary activities after taxation 2,122 (10,804) (8,682) _________ _________ _________ Return per share (p) (9.83p) _________ ___________________________________________________________________________________ STATEMENT OF TOTAL RETURN for the year ended 31 January 2005 (audited) (restated) Revenue Capital Total £000 £000 £000 Gains/(losses) on investments - 3,395 3,395 Income from investments 7,573 - 7,573 Interest receivable 116 - 116 Investment management fee (881) - (881) Administrative expenses (414) - (414) ________ ________ ________ Return on ordinary activities before taxation 6,394 3,395 9,789 Taxation (1,918) (398) (2,316) ________ ________ ________ Return on ordinary activities after taxation 4,476 2,997 7,473 ________ ________ ________ Return per share (p) 8.62p ________ ___________________________________________________________________________________ BALANCE SHEET (unaudited) (audited) (unaudited) Restated Restated At 31 July 2005 At 31 July 2004 At 31 January 2005 £000 £000 £000 Fixed assets Investments 473,908 435,616 427,653 Current assets Debtors 553 543 353 Cash and short term deposits 4,767 2,587 5,318 _________ _________ _________ 5,320 3,130 5,671 Creditors: amounts falling due within one year (742) (759) (943) _________ _________ _________ Net current assets 4,578 2,371 4,728 _________ _________ _________ Total assets less current liabilities 478,486 437,987 432,381 Provision for liabilities and charges (88) (84) (54) _________ _________ _________ Net assets 478,398 437,903 432,327 _________ _________ _________ Capital and reserves Called up share capital 20,490 21,765 20,733 Capital redemption reserve 1,605 330 1,362 Share premium account 32,643 32,643 32,643 Reserves 423,660 383,165 377,589 _________ _________ _________ Equity Shareholders' funds 478,398 437,903 432,327 _________ _________ _________ Net asset value per share 583.70p 502.98p 521.31p _________ _________ _________ STATEMENT OF CHANGES IN EQUITY Capital Share Capital Capital Share redemption premium reserve reserve Revenue capital reserve account - realised - unrealised reserve Total Six months ended 31 July £'000 £'000 £'000 £'000 £'000 £'000 £'000 2005 Balance at 31 January 2005 20,733 1,362 32,643 323,606 49,769 4,214 432,327 (restated) Net profit on ordinary - - - 2,775 48,163 2,506 53,444 activities after taxation Dividends paid (Final 2005 - - - - - (2,526) (2,526) - 3.05p) Buyback of Ordinary shares (243) 243 - (4,847) - - (4,847) Balance at 31 July 2005 20,490 1,605 32,643 321,534 97,932 4,194 478,398 Capital Share Capital Capital Share redemption premium reserve reserve Revenue capital reserve account - realised - unrealised reserve Total Six months ended 31 July £'000 £'000 £'000 £'000 £'000 £'000 £'000 2004 Balance at 31 January 2004 22,095 - 32,643 343,575 53,168 3,991 455,472 (restated) Net profit / (loss) on - - - 2,114 (12,918) 2,122 (8,682) ordinary activities after taxation Dividends paid (Final 2004 - - - - - (2,519) (2,519) - 2.85p) Buyback of Ordinary shares (330) 330 - (6,368) - - (6,368) Balance at 31 July 2004 21,765 330 32,643 339,321 40,250 3,594 437,903 Capital Share Capital Capital Share redemption premium reserve reserve Revenue capital reserve account - realised - unrealised reserve Total Year ended 31 January 2005 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 31 January 2004 22,095 - 32,643 343,575 53,168 3,991 455,472 (restated) Net profit / (loss) on - - - 6,396 (3,399) 4,476 7,473 ordinary activities after taxation Dividends paid (Final 2004 - - - - - (4,253) (4,253) - 2.85p, Interim 2005 - 2.00p) Buyback of Ordinary shares (1,362) 1,362 - (26,365) - - (26,365) Balance at 31 January 2005 20,733 1,362 32,643 323,606 49,769 4,214 432,327 CASHFLOW STATEMENT 6 months to Restated Restated 31 July 2005 6 months to 12 months to (unaudited) 31 July 2004 31 January 2005 £000 £000 £000 Net revenue on ordinary activities before taxation 3,589 3,140 6,394 (Increase)/decrease in accrued income (229) (54) 159 (Increase)/decrease in other debtors (6) 5 15 (Decrease)/Increase in creditors (26) 9 23 UK Corporation Tax paid (619) (355) (745) Withholding tax deducted from foreign income (570) (553) (1,355) _______ _______ _______ Net cash inflow from operating activities 2,139 2,192 4,491 _______ _______ _______ Financial investment Purchase of investments (7,219) (5,296) (10,907) Sale of investments 11,525 11,912 40,008 _________ _______ _______ Net cash inflow from financial investment 4,306 6,616 29,101 _______ _______ _______ Equity dividends paid (2,526) (2,519) (4,253) _______ _________ _______ Net cash inflow before financing 3,919 6,289 29,339 _______ _________ _______ Financing Buyback of ordinary shares (4,847) (6,368) (26,365) _______ _________ _______ Net cash outflow from financing (4,847) (6,368) (26,365) _______ _________ _______ (Decrease)/increase in cash (928) (79) 2,974 _______ _________ _______ NOTES: 1. The accounts have been prepared under the historical cost convention, modified to include the revaluation of investments and in accordance with applicable Accounting Standards and with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies'. They have also been prepared on the assumption that approval as an investment trust will continue to be granted. For the accounting period beginning on 1 February 2005 the Company had the option to prepare its financial statements in accordance with International Financial Reporting Standards (IFRS) adopted by the International Accounting Standards Board (IASB). The Board has elected to continue to adopt UK Generally Accepted Accounting Principles (UK GAAP) and therefore comply with the new Financial Reporting Standards issued as part of the programme to converge UK GAAP with IFRS. Figures for the 6 months ended 31 July 2004 and year ended 31 January 2005 have been restated accordingly. The same accounting policies used for the year ended 31 January 2005 have been applied with the following exceptions: (a) Investments - Investments are measured initially at cost and are recognised at trade date. Subsequent to initial recognition, investments are valued at fair value. For US listed investments this is deemed to be closing prices. Movements in fair value are recognised in the statement of total return. (b) Dividends payable - Interim and final dividends are recognised in the period in which they are paid. 2. The interim dividend will be paid on 21 October 2005 to shareholders on the register at the close of business on 23 September 2005. The ex-dividend date is 21 September 2005. 3. The financial information for the year ended 31 January 2005 has been extracted from the Annual Report and Accounts of the company which have been filed with the Registrar of Companies. The auditors' report on those accounts was unqualified. The statement of total return and balance sheet do not represent full accounts in accordance with section 240 of the Companies Act 1985. 4. The Interim Report will be posted to shareholders in late September 2005 and copies will be available from the investment manager. Please note that past performance is not necessarily a guide to the future and that the value of investments and the income from them may fall as well as rise and may be affected by exchange rate movements. Investors may not get back the amount they originally invested. For Edinburgh US Tracker Trust plc Edinburgh Fund Managers plc, Secretary END This information is provided by RNS The company news service from the London Stock Exchange

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