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Perpetual Inc&Growth (PLI)

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Wednesday 28 November, 2012

Perpetual Inc&Growth

Half-yearly Report


Perpetual Income and Growth Investment Trust plc

Half-Yearly Financial Report for the Six Months to 30 September 2012

KEY FACTS

Perpetual Income and Growth Investment Trust plc (the `Company') is an
investment trust company listed on The London Stock Exchange. The Company is
managed by Invesco Asset Management Limited.

Investment Objective of the Company

The Company's investment objective is to provide shareholders with capital
growth and real growth in dividends over the medium to longer term from a
portfolio of securities listed mainly in the UK equity and fixed interest
markets.

Full details of the Company's Investment Policy can be found on page 14 of the
Company's 2012 annual financial report.

Performance Statistics

The Benchmark index of the Company is the FTSE All-Share Index.

                                                  AT            AT          
                                        30 SEPTEMBER      31 MARCH            %
                                                2012          2012       CHANGE
                                                                               
Total return (all income reinvested):                                          
                                                                               
Diluted net assets*                                                        +5.7
                                                                               
Share price*                                                               +6.1
                                                                               
Benchmark*                                                                 +1.9
                                                                               
Diluted net asset value per                                                    
                                                                               
  ordinary share:                                                              
                                                                               
  - after charging dividend                   274.2p        264.2p         +3.8
                                                                               
  - as balance sheet                          276.7p        267.4p         +3.5
                                                                               
Shareholders' funds (£'000)                  612,010       579,908         +5.5
                                                                               
Mid-market price:                                                              
                                                                               
  - ordinary shares                           278.0p        267.7p         +3.8
                                                                               
  - subscription shares                        53.0p         42.5p        +24.7
                                                                               
Premium ordinary share                          0.5%          0.1%             
                                                                               
Capital return - Benchmark*                                                -0.1
                                                                               
  Gearing:                                                                     
                                                                               
  - gross gearing1                             16.4%         18.0%             
                                                                               
  - net gearing2                               16.4%         18.0%             

* Source: Thomson Reuters Datastream.

1 Gross gearing: borrowings shareholders' funds.

2 Net gearing: borrowing less cash and UK government bond holdings ÷
shareholders' funds.

                                             SIX MONTHS ENDED
                                        30 SEPTEMBER 30 SEPTEMBER              
                                                2012         2011              
                                                                               
Revenue                                                                        
                                                                               
Diluted revenue return per share               6.41p        5.94p          +7.9
                                                                               
Dividends - first interim                      2.55p        2.40p              
                                                                               
Dividends - second interim                     2.55p        2.40p              
                                                                               
Dividends - total                              5.10p        4.80p          +6.3

.

INTERIM MANAGEMENT REPORT INCORPORATING CHAIRMAN'S STATEMENT

CHAIRMAN'S STATEMENT

Performance

During the six months to 30 September 2012, the Company's total return was 5.7%
compared to the 1.9% return from the FTSE All-Share Index. The share price
total return was 6.1% and the premium to NAV per ordinary share increased from
0.1% to 0.5%.

Dividend

The Board is pleased to declare a second interim dividend of 2.55p per share in
respect of the three months to 30 September 2012. This dividend is payable on
28 December 2012 to shareholders registered at the close of business on 7
December 2012.

Subscription Share Exercise and Issued Share Capital

During the period under review, subscription shareholders had their seventh
opportunity to exercise their right to subscribe for one ordinary share of the
Company at a price of 218.94p. The subscription period ended on 31 August 2012.
As a result, 4,072,885 ordinary shares were allotted on 13 September 2012.
Subscription shareholders will have their final opportunity to convert their
holdings in 2013.

In addition a further 566,039 ordinary shares were issued for cash and, as a
result of the above transactions, the issued share capital of your Company at
the period end was 218,455,774 ordinary shares of 10p each and 12,914,737
subscription shares.

Board of Directors

Following a thorough search, the Board is pleased to announce the appointment
of Richard Laing as a non-executive Director of the Company with effect from 20
November 2012. Richard was previously CEO of CDC Group plc, formerly the
Commonwealth Development Corporation Group, from 2004 to 2011, having joined
the organisation in 2000 as Finance Director. Prior to CDC, Richard spent 15
years at De La Rue plc where he held a number of positions both in the UK and
overseas, latterly as Group Finance Director. Richard is currently a
non-executive Director at Miro Forestry, the London Metal Exchange and a
Trustee and board member of the Overseas Development Institute (the UK's
leading independent think-tank on international development). He also sits on
the Advisory Board for Aureos Capital. He is a graduate of Cambridge University
where he obtained an MA in Engineering and is a Fellow of the Institute of
Chartered Accountants.

Bill Alexander
Chairman

28 November 2012


.

INVESTMENT MANAGEMENT REPORT

Market Review

Global stock markets made further positive progress during the period, as
investor appetite for riskier assets increased. This improvement in sentiment
resulted from developments in the Eurozone and the promise of substantial
further monetary stimulus. European political leaders committed themselves to 
the idea of a single supervisor of Eurozone banks and a mechanism to inject 
capital into troubled banks directly. A further boost came as the European 
Central Bank announced a new bond buying plan and the US Federal Reserve 
announced additional and unlimited quantitative easing. The period ended, 
however, with a further warning from the International Monetary Fund that it 
would cut its forecast for global economic growth, while civil unrest in Spain 
and Greece highlighted the challenges facing governments intent on imposing 
further austerity measures.

The period was also noteworthy for the number of profit downgrades from
companies, particularly within the industrial cyclical part of the market.
These included Caterpillar, a traditional bellwether of the global corporate
outlook, which cut its earnings forecasts as far ahead as 2015, citing weak
demand from the mining industry.

Portfolio Strategy & Review

The outperformance of the Company compared to the benchmark index arose from a
range of the "mid-cap" stocks in the portfolio which contributed significantly
to performance. Provident Financial announced a positive trading update,
notably in its fast growing credit card business, while Amlin, Beazley and
Hiscox all announced a return to profits on the back of a more benign claims
environment. TalkTalk Telecom saw its shares rise very strongly over a period
when the company announced first a joint venture with the Post Office and
Fujitsu to provide next-generation broadband and telephony services and
subsequently plans to launch a new TV service.

Shares in BAE Systems had performed strongly in the months before the company
confirmed that it was in early stage talks with EADS regarding a merger. The
deal did not appear to be significantly beneficial to shareholders and, after
an initial spike higher, BAE Systems shares retreated to the level they stood
at immediately before the announcement. Since the half year end the two
companies have confirmed that merger negotiations have been terminated.

The portfolio has no exposure to the mining sector and this provided a positive
impact on performance over the six months. The sector underperformed as company
results confirmed the impact that falling commodity prices and rising costs are
having on earnings and future projects in the sector.

The portfolio has a significant weighting in the tobacco sector, which
underperformed during the period. News that the Australian Government had been
successful in defending a challenge from the tobacco industry against the
introduction of plain packaging had largely been expected, but appeared to act
as a catalyst for profit taking in a sector which has performed very strongly
over the past few years. The Investment Manager remains of the view that the
companies held in the sector represent exactly the sort of quality stocks that
can deliver rising profits and dividends through a low growth environment - and
does not believe that this sustainable growth potential is yet valued
appropriately.

In terms of trading activity within the portfolio, new investments were made in
Carnival and Thomas Cook. The Company disposed of its holding in Pennon Group
and Rolls Royce while the holding in International Power was the subject of a
cash bid from GDF Suez.

Outlook

The stock market's rise in the past year, fuelled by monetary stimulus and
central bank policy initiatives, occurred despite reductions in the forecasts
of company earnings for the current financial year due to renewed weakness in
the key economics of the US, China and the Eurozone. Equity valuations are
therefore no longer as compellingly cheap as they were at the beginning of the
year, and the Investment Manager anticipates that stock markets may now track
sideways for a while.

However, within the market as a whole there is still a subset of stocks that
look attractively valued, particularly for investors seeking income. Indeed
with the yield on offer from equities currently well above that of bonds or
cash - a situation last witnessed in the 1950s - and earnings growth under
pressure, income is likely to provide a higher percentage of stock market total
return.

The investment manager's investment strategy is to focus on companies with
reliable cash flow and sustainable dividend growth, operating in less cyclical
and more defensive industries. Overlaying this is balance sheet strength, with
an associated ability to access the credit markets for funding. He continues to
believe that the valuations of such companies do not reflect their ability to
deliver earnings and dividend growth in an economic environment that continues
to be challenging.


Mark Barnett
Investment Manager

28 November 2012

.

Related Parties and Transactions with the Manager

The Company has no related parties. Invesco Asset Management Limited (`IAML'),
a wholly owned subsidiary of Invesco Limited, acts as Manager and Company
Secretary to the Company. Details of IAML's services and fee arrangements are
given in the latest annual financial report, which is available on the
Manager's website.

Principal Risks and Uncertainties

The principal risk factors relating to the Company can be summarised as
follows:

• Investment objective - there can be no guarantee that the Company will meet
its investment objective;

• Market risk - a fall in the stock markets and/or a prolonged period of
decline in the stock markets relative to other forms of investments will affect
the performance of the portfolio, as well as the performance of individual
portfolio investments;

• Investment risk - is the risk of poor performance of individual investments.
This is mitigated by diversification and ongoing monitoring of investment
guidelines;

• Shares - share prices are affected by market sentiment, supply and demand for
the shares, and dividends declared as well as portfolio performance;

• Gearing - the use of borrowings will amplify the effect on shareholders'
funds of portfolio gains and losses;

• Regulatory - consequences of a serious breach of regulatory rules could
include, but are not limited to, the Company being subject to capital gains on
its investments; suspension from the London Stock Exchange; fines; a qualified
audit report, reputational problems and a loss of assets through fraud; and

• Reliance on third party service providers - failure by any service provider
to carry out its obligations to the Company could have a materially detrimental
impact on the operation of the Company and affect the ability of the Company to
successfully pursue its investment policy.

A detailed explanation of these principal risks and uncertainties can be found
on pages 16 to 18 of the Company's 2012 annual financial report, which is
available on the Manager's website www.invescoperpetual.co.uk/investmenttrusts

In the view of the Board these principal risks and uncertainties are as much
applicable to the remaining six months of the financial year as they were to
the six months under review.

Going Concern

The financial statements have been prepared on a going concern basis. The
Directors consider this is the appropriate basis as they have a reasonable
expectation that the Company has adequate resources to continue in operational
existence for the foreseeable future. In reaching this conclusion, the
Directors took into account the diversified portfolio of readily realisable
securities which can be used to meet funding commitments, and the ability of
the Company to meet all of its liabilities and ongoing expenses from its
assets.

DIRECTORS' RESPONSIBILITY STATEMENT

in respect of the preparation of the half-yearly financial report

The Directors are responsible for preparing the half-yearly financial report
using accounting policies consistent with applicable law and UK Accounting
Standards.

The Directors confirm that to the best of their knowledge:

- the condensed set of financial statements contained within the half-yearly
financial report have been prepared in accordance with the Accounting Standards
Board's Statement "Half-Yearly Financial Report";

- the interim management report includes a fair review of the information
required by DTR 4.2.7R and DTR 4.2.8R of the FSA's Disclosure and Transparency
Rules; and

- the interim management report includes a fair review of the information
required on related party transactions.

The half-yearly financial report has not been audited or reviewed by the
Company's auditors.

Signed on behalf of the Board of Directors.


Bill Alexander
Chairman

28 November 2012

.

INVESTMENT PORTFOLIO STATEMENT AT 30 SEPTEMBER 2012

UK ordinary shares unless stated otherwise

                                                               MARKET          
                                                                VALUE      % OF
ISSUER                               SECTOR                     £'000 PORTFOLIO
                                                                               
Equity investments                                                             
                                                                               
BT                                   Fixed Line                40,437       5.7
                                     Telecommunications                        
                                                                               
Imperial Tobacco                     Tobacco                   37,850       5.3
                                                                               
British American Tobacco             Tobacco                   34,896       4.9
                                                                               
Reynolds American - US Common Stock  Tobacco                   34,731       4.9
                                                                               
Roche - Swiss Common Stock           Pharmaceuticals &         30,082       4.2
                                     Biotechnology                             
                                                                               
GlaxoSmithKline                      Pharmaceuticals &         28,037       3.9
                                     Biotechnology                             
                                                                               
AstraZeneca                          Pharmaceuticals &         27,986       3.9
                                     Biotechnology                             
                                                                               
BAE Systems                          Aerospace & Defence       27,068       3.8
                                                                               
Reckitt Benckiser                    Household Goods & Home    24,651       3.5
                                     Construction                              
                                                                               
BG                                   Oil & Gas Producers       24,546       3.4
                                                                               
Top ten holdings                                              310,284      43.5
                                                                               
Novartis - Swiss Common Stock        Pharmaceuticals &         24,031       3.3
                                     Biotechnology                             
                                                                               
Babcock International                Support Services          21,590       3.0
                                                                               
Hiscox                               Non-life Insurance        20,042       2.8
                                                                               
Capita                               Support Services          17,891       2.5
                                                                               
Provident Financial                  Financial Services        16,969       2.3
                                                                               
Vodafone                             Mobile Communications     16,913       2.3
                                                                               
Amlin                                Non-life Insurance        15,546       2.1
                                                                               
Ladbrokes                            Travel & Leisure          14,388       2.0
                                                                               
TalkTalk Telecom                     Fixed Line                14,067       2.0
                                     Telecommunications                        
                                                                               
KCOM                                 Fixed Line                14,036       2.0
                                     Telecommunications                        
                                                                               
Top twenty holdings                                           485,757      67.8
                                                                               
Beazley                              Non-life Insurance        13,964       1.9
                                                                               
Centrica                             Gas, Water &              13,229       1.9
                                     Multiutilities                            
                                                                               
Carnival                             Travel & Leisure          12,688       1.8
                                                                               
Compass                              Travel & Leisure          12,327       1.7
                                                                               
BTG                                  Pharmaceuticals &         11,795       1.6
                                     Biotechnology                             
                                                                               
Rentokil Initial                     Support Services          11,680       1.6
                                                                               
Drax                                 Electricity               11,574       1.6
                                                                               
Serco                                Support Services          10,184       1.4
                                                                               
Napo PharmaceuticalsUQ               Pharmaceuticals &          9,260       1.3
                                     Biotechnology                             
                                                                               
SSE                                  Electricity                8,703       1.2
                                                                               
Top thirty holdings                                           601,161      83.8
                                                                               
Brown (N)                            General Retailers          7,687       1.1
                                                                               
Tate & Lyle                          Food Producers             7,160       1.0
                                                                               
Workspace                            Real Estate Investment     7,135       1.0
                                     & Services                                
                                                                               
Lancashire                           Non-life Insurance         6,743       1.0
                                                                               
Wm Morrison Supermarkets             Food & Drug Retailers      6,668       0.9
                                                                               
Homeserve                            Support Services           6,418       0.9
                                                                               
Reed Elsevier                        Media                      6,085       0.9
                                                                               
Chemring                             Aerospace & Defence        5,746       0.8
                                                                               
Vectura                              Pharmaceuticals &          5,074       0.7
                                     Biotechnology                             
                                                                               
Doric Nimrod Air Two - Preference    Equity Investment          4,816       0.7
shares                               Instruments                               
                                                                               
Top forty holdings                                            664,693      92.8
                                                                               
Filtrona                             Support Services           4,644       0.7
                                                                               
Impax Environmental Markets          Equity Investment          4,018       0.6
                                     Instruments                               
                                                                               
Regus                                Support Services           3,972       0.6
                                                                               
Impax Asian Environmental Markets -  Equity Investment          3,517       0.5
ordinary & subscription shares       Instruments                               
                                                                               
Lombard Medical Technologies         Healthcare Equipment &     3,508       0.5
                                     Services                                  
                                                                               
Damille Investments II               Equity Investment          3,479       0.5
                                     Instruments                               
                                                                               
Thomas Cook                          Travel & Leisure           3,437       0.5
                                                                               
Fusion                               Financial Services         3,249       0.5
                                                                               
Imperial Innovations                 Financial Services                        
                                                                               
- convertible `B' shares UQ                                     1,784 }     0.4    
                                                                               
- ordinary shares                                               1,240 }         
                                                                               
Damille Investments                  Equity Investment          2,521       0.4
                                     Instruments                               
                                                                               
Top fifty holdings                                            700,062      98.0
                                                                               
Macau Property                       Real Estate Investment     2,257       0.3
                                     & Services                                
                                                                               
Altus Resource Opportunities Fund    Equity Investment          1,887       0.3
                                     Instruments                               
                                                                               
PuriCore                             Healthcare Equipment &     1,198       0.2
                                     Services                                  
                                                                               
XCounter AB - Swedish Common Stock   Healthcare Equipment &     1,193       0.2
                                     Services                                  
                                                                               
Halosource                           Chemicals                    719       0.1
                                                                               
UK Coal                              Mining                       463       0.1
                                                                               
XTL Biopharmaceutical US ADR (10 ord Pharmaceuticals &            401         -
shares)                              Biotechnology                             
                                                                               
Hibu                                 Media                         66         -
                                                                               
Helphire                             Financial Services            53         -
                                                                               
Mirada                               Media                          9         -
                                                                               
Top sixty holdings                                            708,308      99.2
                                                                               
Total equity investments (60)                                 708,308      99.2
                                                                               
Other investments                                                              
                                                                               
ISSUER                               SECTOR (MOODY RATING)                     
                                                                               
Lombard Medical Technologies - 8% 01 Healthcare Equipment &     2,100       0.3
Sep 2013UQ                           Services                                  
                                     NR                                        
                                                                               
Barclays Bank - Nuclear Power Notes  Electricity                1,409       0.2
28 Feb 2019                          NR                                        
                                                                               
PuriCore Convertible Notes 6% 31 Dec Healthcare Equipment &     1,125       0.2
2013UQ                               Services                                  
                                     NR                                        
                                                                               
Ecofin Water & Power Opportunities   Equity Investment            392       0.1
6% 31 Jul 2016                       Instruments                               
                                     NR                                        
                                                                               
Total other investments (4)                                     5,026       0.8
                                                                               

Total investments (64)                                        713,334     100.0

UQ Unquoted NR Non-rated

.

CONDENSED INCOME STATEMENT

                             SIX MONTHS TO            SIX MONTHS TO        YEAR TO
                           30 SEPTEMBER 2012        30 SEPTEMBER 2011     31 MARCH
                                                                              2012
                                                                                  
                              (UNAUDITED)              (UNAUDITED)         AUDITED
                                                                                  
                        REVENUE CAPITAL   TOTAL REVENUE  CAPITAL    TOTAL    TOTAL
                                                                                  
                          £'000   £'000   £'000   £'000    £'000    £'000    £'000
                                                                                  
Gains/(losses) on             -  25,348  25,348       - (19,434) (19,434)   31,275
investments at fair                                                               
value                                                                             
                                                                                  
Foreign exchange gains        -      39      39       -        5        5       19
                                                                                  
Income                                                                            
                                                                                  
--UK dividends           14,246       -  14,246  13,136        -   13,136   23,328
                                                                                  
--Overseas dividends      1,168       -   1,168     977        -      977    3,427
                                                                                  
--Unfranked investment      143       -     143     245        -      245      117
  income                                                                            
                                                                                  
--Scrip dividends            49       -      49       -        -        -       32
                                                                                  
Gross return             15,606  25,387  40,993  14,358 (19,429)  (5,071)   58,198
                                                                                  
Investment management     (793) (1,850) (2,643)   (744)  (1,736)  (2,480)  (4,986)
fee - note 2                                                                      
                                                                                  
Performance fee - note 2      - (2,456) (2,456)       -  (2,737)  (2,737)    (886)                                                                                                                                               
Other expenses            (269)     (1)   (270)   (293)      (1)    (294)    (547)
                                                                                  
Net return before        14,544  21,080  35,624  13,321 (23,903) (10,582)   51,779
finance costs and                                                                 
taxation                                                                          
                                                                                  
Finance costs - note 2    (454) (1,059) (1,513)   (453)  (1,057)  (1,510)  (2,957)
                                                                                  
Return on ordinary       14,090  20,021  34,111  12,868 (24,960) (12,092)   48,822

activities before                                                                 
taxation                                                                          
                                                                                  
Tax on ordinary           (144)       -   (144)   (146)        -    (146)    (514)
activities - note 3                                                               
                                                                                  
Return on ordinary       13,946  20,021  33,967  12,722 (24,960) (12,238)   48,308
activities after                                                                  
taxation for the                                                                  
financial period                                                                  
                                                                                  
Return per ordinary                                                               
share - note 4                                                                    
                                                                                  
Basic                     6.50p   9.34p  15.84p   6.01p (11.80p)  (5.79p)   22.74p
                                                                                  
Diluted                   6.41p   9.20p  15.61p   5.94p (11.65p)  (5.71p)   22.47p

The total column of this statement represents the Company's income statement.
The supplementary revenue and capital columns are presented for information
purposes in accordance with the Statement of Recommended Practice issued by the
Association of Investment Companies. All items in the above statement derive
from continuing operations and the Company has no other gains or losses. No
operations were acquired or discontinued in the period.

.

CONDENSED RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS

                                        SHARE   SHARE  CAPITAL  REVENUE         
                                      CAPITAL PREMIUM  RESERVE  RESERVE    TOTAL
                                                                                
                                        £'000   £'000    £'000    £'000    £'000
                                                                                
FOR THE SIX MONTHS ENDED 30 SEPTEMBER                                           
2011 (UNAUDITED)                                                                
                                                                                
At 31 March 2011                       21,090 187,732  317,805   18,714  545,341
                                                                                
Net return on ordinary activities           -       - (24,960)   12,722 (12,238)
                                                                                
Dividends paid - note 7                     -       -        - (10,892) (10,892)
                                                                                
Unclaimed dividends                         -       -        -       13       13
                                                                                
Issue of new shares                       169   4,197        -        -    4,366
                                                                                
Exercise of subscription shares            49   1,026        -        -    1,075
                                                                                
At 30 September 2011                   21,308 192,955  292,845   20,557  527,665
                                                                                
FOR THE YEAR ENDED 31 MARCH 2012                                                
(AUDITED)                                                                       
                                                                                
At 31 March 2011                       21,090 187,732  317,805   18,714  545,341
                                                                                
Net return on ordinary activities           -       -   24,958   23,350   48,308
                                                                                
Dividends paid - note 7                     -       -        - (21,130) (21,130)
                                                                                
Unclaimed dividends                         -       -        -       13       13
                                                                                
Issue of new shares                       243   6,058        -        -    6,301
                                                                                
Exercise of subscription shares            49   1,026        -        -    1,075
                                                                                
At 31 March 2012                       21,382 194,816  342,763   20,947  579,908
                                                                                
FOR THE SIX MONTHS ENDED 30 SEPTEMBER                                           
2012 (UNAUDITED)                                                                
                                                                                
At 31 March 2012                       21,382 194,816  342,763   20,947  579,908
                                                                                
Net return from ordinary activities         -       -   20,021   13,946   33,967
                                                                                
Dividends paid - note 7                     -       -        - (12,309) (12,309)
                                                                                
Unclaimed dividends                         -       -        -        3        3
                                                                                
Issue of new shares                        57   1,467        -        -    1,524
                                                                                
Exercise of subscription shares           407   8,510        -        -    8,917
                                                                                
At 30 September 2012                   21,846 204,793  362,784   22,587  612,010

.

CONDENSED BALANCE SHEET

Registered number 3156676

                                                 AT             AT           AT
                                       30 SEPTEMBER   30 SEPTEMBER     31 MARCH
                                               2012           2011         2012
                                                                               
                                          UNAUDITED      UNAUDITED      AUDITED
                                                                               
                                              £'000          £'000        £'000
                                                                               
Fixed assets                                                                   
                                                                               
Investments at fair value                   713,334        631,199      683,579
                                                                               
Current assets                                                                 
                                                                               
Amount due from brokers                         459          1,491           33
                                                                               
Proceeds due from issue of new                    -          1,008          893
shares                                                                         
                                                                               
Prepayments and accrued income                3,062          2,751        3,487
                                                                               
                                              3,521          5,250        4,413
                                                                               
Creditors: amounts falling due                                                 
within one year                                                                
                                                                               
Bank overdraft                             (70,608)       (74,428)     (74,302)
                                                                               
Amounts due to brokers                            -           (67)      (1,190)
                                                                               
Accruals and deferred income                (1,893)        (1,719)      (1,846)
                                                                               
Performance fee payable                           -              -        (886)
                                                                               
                                           (72,501)       (76,214)     (78,224)
                                                                               
Net current liabilities                    (68,980)       (70,964)     (73,811)
                                                                               
Total assets less current                   644,354        560,235      609,768
liabilities                                                                    
                                                                               
Creditors: amounts falling due                                                 
after more than one year                                                       
                                                                               
  Debenture 2014                           (29,888)       (29,833)     (29,860)
                                                                               
Provision for performance fee               (2,456)        (2,737)            -
                                                                               
Net assets                                  612,010        527,665      579,908
                                                                               
Capital and reserves                                                           
                                                                               
Share capital - note 6                       21,846         21,308       21,382
                                                                               
Share premium                               204,793        192,955      194,816
                                                                               
Capital reserve                             362,784        292,845      342,763
                                                                               
Revenue reserve                              22,587         20,557       20,947
                                                                               
Shareholders' funds                         612,010        527,665      579,908
                                                                               
Net asset value per ordinary share                                             
- note 5                                                                       
                                                                               
Basic                                        280.2p         247.6p       271.2p
                                                                               
Diluted                                      276.7p         245.5p       267.4p

.

CONDENSED CASH FLOW STATEMENT

                                            SIX MONTHS   SIX MONTHS            
                                                    TO           TO     YEAR TO
                                          30 SEPTEMBER 30 SEPTEMBER    31 MARCH
                                                  2012         2011        2012
                                                                               
                                             UNAUDITED    UNAUDITED     AUDITED
                                                                               
                                                 £'000        £'000       £'000
                                                                               
Net return before finance costs and             35,624     (10,582)      51,779
taxation                                                                       
                                                                               
(Gains)/losses on investments                 (25,348)       19,434    (31,275)
                                                                               
Foreign exchange gains                            (40)          (5)        (19)
                                                                               
Scrip dividends                                   (49)            -        (32)
                                                                               
Decrease in debtors                                425          845         109
                                                                               
Increase in creditors and provisions             1,617        2,665         941
                                                                               
Tax on overseas income                           (144)        (146)       (514)
                                                                               
Net cash flow from operating activities         12,085       12,211      20,989
                                                                               
Servicing of finance                           (1,485)      (1,482)     (2,902)
                                                                               
Capital expenditure and financial                                              
investment                                                                     
                                                                               
Purchase of investments                       (77,499)     (59,096)   (137,041)
                                                                               
Sale of investments                             71,525       54,335     133,223
                                                                               
Net equity dividends paid                     (12,306)     (10,879)    (21,117)
                                                                               
Net cash outflow before management of          (7,680)      (4,911)     (6,848)
liquid resources and financing                                                 
                                                                               
Financing                                       11,334        4,434       6,483
                                                                               
Increase/(decrease) in cash in the period        3,654        (477)       (365)
                                                                               
Exchange movements                                  40            5          19
                                                                               
Debenture stock non-cash movement                 (28)         (28)        (55)
                                                                               
Movement in net debt in the period               3,666        (500)       (401)
                                                                               
Net debt at beginning of period              (104,162)    (103,761)   (103,761)
                                                                               
Net debt at end of period                    (100,496)    (104,261)   (104,162)
                                                                               
Analysis of changes in net debt:                                               
                                                                               
Brought forward:                                                               
                                                                               
--Bank overdraft                              (74,302)     (73,956)    (73,956)
                                                                               
--Debenture 2014                              (29,860)     (29,805)    (29,805)
                                                                               
Net debt brought forward                     (104,162)    (103,761)   (103,761)
                                                                               
Movements in the period:                                                       
                                                                               
--Cash inflow/(outflow) from bank                3,654        (477)       (365)
                                                                               
--Exchange movements                                40            5          19
                                                                               
--Debenture stock non-cash movement               (28)         (28)        (55)
                                                                               
Net debt at end of period                    (100,496)    (104,261)   (104,162)

.

NOTES TO THE CONDENSED FINANCIAL STATEMENTS

1. Basis of Preparation

The condensed financial statements of the Company have been prepared using the
same accounting policies as those adopted in the 2012 annual financial report,
which are consistent with applicable United Kingdom Accounting Standards and
with the Statement of Recommended Practice: `Financial Statements of Investment
Trust Companies and Venture Capital Trusts'.

2. Investment Management Fees and Finance Costs

Investment management fees and finance costs are allocated 70% to capital and
30% to revenue. A provision for a performance-related fee is recognised if the
Company's performance exceeds the FTSE All-Share Index and is wholly allocated
to capital. A performance fee of £2,456,000 has been provided for the six
months under review (30 September 2011: £2,737,000). A performance fee of £
886,000 was accrued and later paid for the year ended 31 March 2012.

3. Tax

Owing to the Company's status as an investment company, no tax liability arises
on capital gains. The tax charge represents withholding tax suffered on
overseas income.

4. Basis of Return per Ordinary Share

                                            SIX MONTHS   SIX MONTHS     YEAR TO
                                                    TO           TO            
                                          30 SEPT 2012 30 SEPT 2011 31 MAR 2012
                                                                               
                                           (UNAUDITED)  (UNAUDITED)   (AUDITED)
                                                                               
   Returns after tax (£'000) :                                                 
                                                                               
   Revenue                                      13,946       12,722      23,350
                                                                               
   Capital                                      20,021     (24,960)      24,958
                                                                               
   Total                                        33,967     (12,238)      48,308
                                                                               
   Weighted average number of ordinary                                         
   shares in issue during the period:                                          
                                                                               
   - basic                                 214,451,329  211,512,685 212,400,366
                                                                               
   - diluted                               217,551,933  214,197,720 215,051,088

The subscription shares are dilutive for the purposes of return per share when
they would result in the issue of ordinary shares. This occurs when the average
market price of the ordinary shares during the period is greater than the
exercise price of 218.94p. The average market price for the six months ended 30
September 2012 was 269.11p (six months ended 30 September 2011: 258.80p; year
ended 31 March 2012: 258.13p) and was dilutive.

5. Basis of Net Asset Value (`NAV') per Ordinary Share

                                            AT 30 SEPT   AT 30 SEPT   AT 31 MAR
                                                  2012         2011        2012
                                                                               
                                           (UNAUDITED)  (UNAUDITED)   (AUDITED)
                                                                               
   Shareholders' funds (£'000):                                                
                                                                               
   - basic                                     612,010      527,665     579,908
                                                                               
   - diluted                                   640,286      564,858     617,101
                                                                               
   Number of ordinary shares in issue at                                       
   period end:                                                                 
                                                                               
   - basic                                 218,455,774  213,085,780 213,816,850
                                                                               
   - diluted                               231,370,511  230,073,402 230,804,472

As the basic NAV is greater than the exercise price of 218.94p, the
subscription shares are dilutive and subscription shareholders are likely to
exercise their option.

6. Share Capital

(a) Ordinary shares of 10p each

                                            SIX MONTHS   SIX MONTHS        YEAR
                                                    TO           TO          TO
                                          30 SEPT 2012 30 SEPT 2011 31 MAR 2012
                                                                               
                                           (UNAUDITED)  (UNAUDITED)   (AUDITED)
                                                                               
   Number of ordinary shares:                                                  
                                                                               
   Brought forward                         213,816,850  210,900,504 210,900,504
                                                                               
   Ordinary shares issued for cash             566,039    1,694,073   2,425,143
                                                                               
   Exercise of subscription shares           4,072,885      491,203     491,203
                                                                               
   Carried forward                         218,455,774  213,085,780 213,816,850

During the period 566,039 new ordinary shares were issued for an average 270.65
pence per share.

(b) Subscription Shares

The subscription shares carry the right to subscribe for one ordinary share at
a price of 218.94p on 31 August in each of the years 2010 to 2013. During the
period 4,072,885 subscription shares were exercised leaving 12,914,737
subscription shares remaining at the period end.

7. Dividends per Ordinary Share

The first interim dividend of 2.55p was paid on 28 September 2012 to
shareholders registered on 7 September 2012. The Directors have declared a
second interim dividend of 2.55p payable on 28 December 2012 to shareholders
registered on 7 December 2012.

                                            SIX MONTHS   SIX MONTHS        YEAR
                                                    TO           TO          TO  
                                          30 SEPT 2012 30 SEPT 2011 31 MAR 2012
                                                                               
                                           (UNAUDITED)  (UNAUDITED)   (AUDITED)
                                                                               
   Interim dividends paid (pence):                                             
                                                                               
   Fourth 2011                                       -         2.75        2.75
                                                                               
   First 2012                                        -         2.40        2.40
                                                                               
   Second 2012                                       -            -        2.40
                                                                               
   Third 2012                                        -            -        2.40
                                                                               
   Fourth 2012                                    3.20            -           -
                                                                               
   First 2013                                     2.55            -           -
                                                                               
   Total                                          5.75         5.15        9.95
                                                                               
   £'000 equivalent                             12,309       10,892      21,130

8. Investment Trust Status

It is the intention of the Directors to conduct the affairs of the Company so
that it satisfies the conditions for approval as an investment trust company.

9. Status of Half-Yearly Financial Report

The financial information contained in this half-yearly report, which has not
been audited or reviewed by the independent auditors, does not constitute
statutory accounts as defined in section 434 of the Companies Act 2006. The
financial information for the half years ended 30 September 2012 and 30
September 2011 has not been audited. The figures and financial information for
the year ended 31 March 2012 are extracted and abridged from 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 Independent Auditor, which was unqualified and did not
include a statement under section 498 of the Companies Act 2006.

By order of the Board

Invesco Asset Management Limited

Company Secretary

28 November 2012

.

DIRECTORS, ADVISERS AND PRINCIPAL SERVICE PROVIDERS

Directors

Bill Alexander, Chairman
Sir Martyn Arbib
Vivian Bazalgette
Richard Laing (appointed 20 November 2012)
Antony Hardy, Audit Committee Chairman and Senior Independent Director
Bob Yerbury

Manager, Company Secretary and Registered Office

Invesco Asset Management Limited
30 Finsbury Square
London EC2A 1AG
T: 020 7065 4000

Company Secretarial contact: Kelly Nice

Manager's Website

Information relating to the Company can be found on the Manager's website at
www.invescoperpetual.co.uk/investmenttrusts.

The contents of websites referred to in the half-yearly financial report and
this announcement, or accessible from links within those websites, are not
incorporated into, nor do they form part of, this document.

Contacts:

Andrew Watkins Tel - 020 7065 4023

Kelly Nice     Tel - 020 7065 4647

a d v e r t i s e m e n t