murray-income.co.uk
Murray Income Trust PLC
Annual Report 30 June 2023
An investment trust founded in 1923 aiming
for high and growing income with capital growth
For more information visit murray-income.co.uk
abrdn.com
Murray Income Trust PLC 113
Directors
Neil Rogan (Chair)
Peter Tait (Senior Independent Director)
Stephanie Eastment (Audit Committee Chair)
Alan Giles
Merryn Somerset Webb
Nandita Sahgal Tully
Company Secretaries, Registered Office and
Company Number
abrdn Holdings Limited
(formerly Aberdeen Asset Management PLC)
1 George Street
Edinburgh EH2 2LL
Registered in Scotland under company number SC012725
Website
murray-income.co.uk
Legal Entity Identifier
549300IRNFGVQIQHUI13
United States Internal Revenue Service
FATCA Registration Number (“GIIN”)
8Q8ZFE.99999.SL.826
Points of Contact
The Chair or Company Secretaries at the Registered
Office of the Company
Email: murray.income@abrdn.com
Customer Services Department and
Enquiries for the abrdn Children’s Plan, Share
Plan and ISA
abrdn Investment Trusts
PO Box 11020
Chelmsford
Essex CM99 2DB
Freephone: 0808 500 0040
(open Monday to Friday from 9.00am to 5.00pm,
excluding public holidays)
Email: inv.trusts@abrdn.com
Please see page 99 for information on the closure of
the abrdn Children’s Plan, Share Plan and ISA in
December 2023.
Alternative Investment Fund Manager
abrdn Fund Managers Limited
Authorised and regulated by the Financial
Conduct Authority
Investment Manager
abrdn Investments Limited
(formerly Aberdeen Asset Managers Limited)
Authorised and regulated by the Financial
Conduct Authority
Registrar (for direct shareholders)
The Share Portal, operated by Link Group, is a secure
online website where shareholdings can be managed
quickly and easily, including changing address or
arranging to pay dividends directly into a bank account, or
to receive electronic communications. To register,
shareholders will need their Investor Code which may be
found on their share certificate or by contacting the
Registrar at: signalshares.com
Alternatively, please contact the Registrar –
By email, via the above website
By phone, Tel: 0371 664 0300
(UK calls cost 10p per minute plus network extras)
From overseas: +44 208 639 3399
(open Monday to Friday, from 9.00am to 5.30pm,
excluding public holidays)
By post -
Link Group
PXS 1
Central Square
29 Wellington Street
Leeds
LS1 4DL
Independent Auditor
PricewaterhouseCoopers LLP
Depositary
BNP Paribas Trust Corporation UK Limited
Solicitors
Dickson Minto W.S.
Stockbroker
Investec Bank plc
Additional Shareholder Information
Murray Income Trust PLC 1
Neil Rogan, Chair
Charles Luke and Iain Pyle,
Investment Manager
Investment Objective
The Company aims for a high and growing
income combined with capital growth through investment
in a portfolio principally of UK equities.
Overview
Performance Highlights 2
Strategic Report
Chair’s Statement 4
Investment Manager’s Report 9
Performance 14
Financial Highlights and Dividends 16
Overview of Strategy 17
Promoting the Success of the Company 24
Portfolio
Ten Largest Investments 27
Portfolio 28
Sector Comparison with the Benchmark 30
Summary of Investment Changes During the Year 31
Governance
Board of Directors 34
Directors’ Report 37
Statement of Corporate Governance 46
Directors’ Remuneration Report 47
Audit Committee Report 51
Statement of Directors’ Responsibilities 54
Independent Auditors’ Report to the Members
of Murray Income Trust PLC 55
Financial Statements
Statement of Comprehensive Income 64
Statement of Financial Position 65
Statement of Changes in Equity 66
Statement of Cash Flows 67
Notes to the Financial Statements 68
Corporate Information
Information about the Manager including
Investment Process 90
How the Investment Manager approaches ESG 93
Investor Information 98
AIFMD Disclosures (Unaudited) 101
General
Alternative Performance Measures 103
Glossary of Terms 107
Notice of Annual General Meeting 108
Additional Shareholder Information 113
Contents
2 Murray Income Trust PLC
Net asset value total return
ABC
Share price total return
AB
+8.8% +4.9%
2022: (3.5)% 2022: (0.7)%
Benchmark total return
AD
Ongoing charges
B
+7.9% 0.50%
2022: +1.6% 2022: 0.48%
Earnings per share (revenue) Dividend per share
38.7
p
37.50
p
2022: 40.5p 2022: 36.00p
Discount to net asset value
BC
Dividend yield
B
8.2% 4.5%
2022: 4.5% 2022: 4.3%
A
Total return as defined on page 105.
B
Considered to be an Alternative Performance Measure. Further details can be found on pages 103 and 106.
C
With debt at fair value.
D
The Company’s benchmark is the FTSE All-Share Index.
Net Asset Value per share
c
Dividends per share Mid-market price per share
At 30 June – pence Year ended 30 June – pence At 30 June – pence
887.8
807.7
935.7
871.0
911.7
19 20 21 22 23
34.00
34.25
34.50
36.00
37.50
19 20 21 22 23
850.0
768.0
871.0
832.0
837.0
19 20 21 22 23
Performance Hi
g
hli
g
hts
Murray Income Trust PLC 3
Strategic Report
Research & development
undertaken by Genus
(a portfolio company
purchased this year)
combines biology and
genetics to deliver
ground-breaking
innovation technologies in DNA
to support a more
sustainable food system.
4 Murray Income Trust PLC
Highlights
· We are celebrating both Murray Income’s centenary
and our record of 50 consecutive years of dividend
growth
· Our objective is to achieve a high and growing income
combined with capital growth from a portfolio
principally of UK equities
· The dividend yield is 4.5%, based on the year end share
price of 837p
· Total dividends per share increased by 4.2% to 37.5p, the
50th consecutive year of dividend growth
· NAV per share total return
AB
was +8.8%, ahead of the
FTSE All-Share Index at +7.9% but the share price total
return was +4.9% as the discount widened
A
Total return (see page 105)
B
With debt at fair value (see page 107)
Introduction
Welcome to the 100th annual report of Murray Income
Trust. In my last year as Chair, it is a pleasure to be able to
report that the Company is in good health and has had a
good year. In this report we will review the year just ended,
look back over our 100-year history, look forward to our
centenary events and assess the long-term outlook.
First, the headline numbers for the year to 30 June 2023.
Helped by a strong second half, NAV (net asset value per
share, with debt at fair value) total return was 8.8% over
the year, outperforming the FTSE All-Share Index total
return of 7.9%. Your share price total return at 4.9% lagged
the NAV as the discount (based on NAV with debt at fair
value) widened from 4.5% to 8.2% over the year. We
announced on 2 August 2023 a fourth interim dividend of
12.75p which takes the full year dividend up 4.2% to 37.5p
per share, marking the 50
th
consecutive year of dividend
increases, and representing a dividend yield of 4.5% at the
30 June 2023 share price.
Centenary and History
Your Company was founded in Glasgow on 8 June 1923
as The Second Scottish Western Investment Company,
Limited with an initial share capital of £500,000. The
Company’s NAV at 30 June 2023 was nearly £1bn. That’s
quite some appreciation over 100 years although we don’t
know the exact figures for shares issued and cancelled
over the early years so we cannot calculate a reliable
annual return. Back in 1923, the Company’s objective was
to invest in shares, stocks, debentures, bonds, mortgages,
obligations and securities of any kind, issued or generated
by any company, corporation or undertaking of whatever
nature, constituted or carrying on business in the United
Kingdom or in any colony or dependency or province
thereof, or in the United States of America or in any other
foreign country. That investment remit was exceptionally
broad and similar to many other generalist investment
trusts of the era. The portfolio was mainly invested into
bonds and preference shares. The move into equities or
ordinary shares appears to have started in the 1930s,
probably prompted by rising defaults on bond holdings
during the 1930s depression.
The Company changed its name to The Caledonian Trust
Company Limited in 1960 and was administered by
Brown, Fleming and Murray, Glasgow chartered
accountants, until the formation of Murray Johnstone in
1968. In 1979 the Company added its Manager’s name to
become Murray Caledonian Investment Trust Limited but
remained a generalist equity trust. With discounts wide
and reflecting a shareholder desire for investment trusts
to specialise, in 1984 it changed to its current name of
Murray Income Trust PLC and to its remit of investing for a
high and growing income from a portfolio predominantly
of UK equities. Murray Johnstone was taken over by
Aberdeen Asset Management in 2000 and Murray Income
has been part of the abrdn stable ever since. Most of the
older records were destroyed by a serious flood in Murray
Johnstone’s offices in the late 1970s. Facsimile records at
Companies’ House are in many cases illegible so, sadly, it is
not possible to construct any long term performance
records with a sufficient level of confidence.
Chair’s Statement
Murray Income Trust PLC 5
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
One thing that we can confirm is the now fifty-year record
of consecutive dividend increases. It was the autumn of
1973 when your Company last did not raise its dividend;
the year of the miners’ strike and three-day week, the
Arab-Israeli war and the oil price shock. The Company’s
dividend per share has grown from 0.47p then to 37.5p in
2023, representing a compound annual growth rate of
9.2%. A more realistic comparison is the 6.0% compound
annual growth rate since the change to a UK equity
income remit in 1984.
The Association of Investment Companies (the “AIC”)
accords Dividend Hero status to investment trusts which
have raised their annual dividend consecutively for twenty
years or more. Maintaining that Dividend Hero status and
with a starting dividend yield level of over 4% is both a
source of pride for the Board and a priority for the future.
Dividend
As outlined above, the Board announced on 2 August 2023
its 50
th
consecutive increase in the annual dividend to
37.5p. Revenue per share for the year was 38.7p, down
4.4% from the previous year’s 40.5p. However, the 37.5p
dividend was 103% covered by net income earned during
the year and the Company was able to transfer the
excess to bolster its revenue reserves, taking them from
17.5p per share to 20.2p, equivalent to 54% (2022: 48%) of
the current annual dividend of 37.5p (2022: 36.0p). The
Board gave extensive consideration to how much to grow
the dividend and how much to add to reserves. Two
factors influenced us in our decision. First is that we prefer
revenue reserves per share to be in the range of one-half
to a full year’s dividend per share. Second is that although
our Manager projects that revenue per share may fall for
another year, dividend cover for UK companies has
already recovered to a very healthy 2.0x for calendar
2023 from 1.5x in calendar 2021.
Investment Performance
Over the twelve months ended 30 June 2023, the
Company’s NAV per share (with debt at fair value) rose
8.8% in total return terms, as compared to the FTSE All-
Share Index (the “Benchmark”) return of 7.9%. The share
price total return was 4.9% reflecting the discount
widening from 4.5% to 8.2% (measured based on NAV
with debt at fair value).
Positive contributors over the year included the
Company’s long-term borrowings, sector allocation and
individual holdings such as Aveva and Sage. The largest
positive contributor was the favourable movement in the
fair (or market) value of the Company’s long-term
gearing: as interest rates rose, the market value of this
liability fell. The main negative contributors over the year
were stock-specific; Watkin Jones, Marshalls and Direct
Line. Charles Luke and Iain Pyle discuss performance in
more detail in the Investment Manager’s Report on
pages 9 to 13.
Looking over longer periods ended 30 June 2023, the
annualised NAV (debt at fair value) performance is
behind the Benchmark over three years but ahead over
five and ten years.
3 years ended 5 years ended 10 years ended
30 June 2023
(
annualised
)
30 June 2023
(
annualised
)
30 June 2023
(
annualised
)
Performance (total return) % % %
Share price
AB
7.3 5.6 5.7
Net asset value per Ordinary share
ABC
8.3 5.3 6.4
FTSE All-Share 10.0 3.1 5.9
Source: abrdn & Morningstar
A
Total return as defined on page 105.
B
Considered to be an Alternative Performance Measure. Further details may be found in pages 103 and 106.
C
With debt at fair value.
6 Murray Income Trust PLC
Investment Process
Our Manager’s investment process is best summarised as
a search for good quality companies at attractive
valuations. The Manager defines a quality company as
one capable of strong and predictable cash generation,
sustainably high returns on capital and with attractive
growth opportunities. These typically result from a sound
business model, a robust balance sheet, good
management and strong environmental, social and
governance characteristics. These qualities helped avoid
the worst of the dividend shocks during the pandemic.
Investment People
abrdn is our appointed investment management
company. Charles Luke has been our lead portfolio
manager since 2006 and works alongside Rhona Millar
and Co-Manager Iain Pyle, as members of abrdn’s 43-
strong Developed Markets Equities team.
Driving Environmental, Social and
Governance (“ESG”) Change
ESG considerations are deeply embedded into the
company analysis carried out by our Manager which is
able to draw on the expertise of more than 60 in-house
ESG specialists. The aim is to mitigate risk and enhance
returns and this results in frequent dialogue with investee
companies and helps to ensure that the companies in the
portfolio are acting in the best long-term interests of their
shareholders and society at large. The objective is to drive
ESG change.
It is important to note that the policy pursued by our
Manager on our behalf is dynamic rather than static. ESG
conclusions change if the inputs change: For example, one
might look at Russia’s invasion of Ukraine and conclude
that the social factor of security and safety is more
important now than previously considered. Similarly, one
might consider energy security be given a higher weight
relative to carbon dioxide emissions and come to a
different conclusion on holding an oil or gas stock.
The Investment Manager’s Report contains further
information on how ESG factors are incorporated into the
Managers’ investment approach. For more detailed
information we would refer you to the Sustainable
Investment Report on our website at:
murray-income.co.uk.
Share Buybacks and Discount
Discounts across the investment trust sector have
widened in the past twelve months, including within the UK
equity income sector. The Board has thus decided to
make more extensive use of its buyback capability. Over
the year, the discount widened from 4.5% to 8.2% while the
average discount was 7.4% and the range was between
4.5% and 12.2% (all based on NAV with debt at fair value).
The Company bought back 5.0m shares during the year,
representing 4.3% of shares in issue at the start of the year.
No shares were issued or sold from treasury.
The Board monitors the discount level closely and will
again be requesting shareholders’ approval at the AGM to
renew the Company’s buyback and issuance powers. As
at 30 June 2023, there were 111,720,001 (2022:
116,690,472) Ordinary 25p shares in issue with voting
rights and 7,809,531 (2022: 2,839,060) shares held
in Treasury.
Ongoing Charges
Our largest cost is the investment management fee
payable to abrdn which is calculated on a sliding scale
with a marginal rate of 0.25% on assets over £450m. The
effect of expanding the Company in 2020 and keeping
tight control of costs generally has resulted in an overall
ongoing charges rate of 0.50%, which the Board considers
good value compared to past history and also to other
funds in the closed- and open-ended industry.
Gearing
The Company has £100m of long-term borrowings with
£40m due in 2027 and £60m due in 2029 at a blended cost
of 3.6%. Together with a £50m short-term multicurrency
facility with Bank of Nova Scotia Limited, the Company has
up to £150m of borrowing facilities available representing
15.0% of net asset value. With the beta of the investment
portfolio (its sensitivity to changes in the Benchmark)
currently running at 0.9 (typical of the Investment
Manager’s style), the Board believes that the appropriate
neutral gearing rate is 10%. At the year end the actual
gearing rate was 10.4% (2022: 9.4%). The annualised cost
of the Company’s current borrowings was 0.26% of NAV
(2022: 0.23%).
Chair’s Statement
Continued
Murray Income Trust PLC 7
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Board Composition
As previously announced and after completing nearly ten
full years of service, I shall be retiring from the Board at the
conclusion of the centenary Annual General Meeting
(“AGM”). Peter Tait, currently Senior Independent Director,
will take over as Chair. Alan Giles will replace Peter as
Senior Independent Director. The other senior board
position is Audit Committee Chair, a post held by
Stephanie Eastment since 2018.
Merryn Somerset Webb has informed us that she does not
wish to stand for re-election as a Director and so will retire
from the Board at the end of the AGM. This is to allow her
to be able to pursue conference hosting roles with
interactive investor and others. We will miss her
knowledge of private investors and marketing and
markets in general. She leaves with our thanks and
best wishes.
The remaining Board members have started a
recruitment exercise. Sadly, I have to report that Jean Park
passed away in May - Jean was a much loved colleague
and a former Director of this Company until 2021.
Online Shareholder Presentation
The Company will hold an online shareholder presentation
for shareholders and other interested parties at 11.00am
on 3
November 2023. This will feature your Chair and
Investment Manager discussing the outlook for the
Company and answering your questions live. Please
submit questions in advance to
murray.income@abrdn.com or on the day via the event
page which is also where you may register:
https://www.workcast.com/register?cpak=
6223673361069891
Centenary Annual General Meeting
The Company will hold its centenary AGM in the city of our
incorporation, at 12.30pm on Tuesday 7 November 2023
in The Glasgow Royal Concert Hall. We hope to mark our
centenary in style. One of the advantages of investing via
investment trusts is that all shareholders have the
opportunity to meet their Manager and the Directors at
the AGM. This year’s meeting will commence with a
presentation on the Company and market outlook from
Charles Luke. There will then be the formal part of the
AGM where shareholders get to ask questions about the
AGM resolutions and thereafter cast their votes via a poll.
After this will be a centenary lunch at which shareholders
will be able to chat to the Manager and Directors.
Shareholders may bring a guest with them to the meeting.
Action to be Taken
If you wish to attend and are unsure how to register,
please send an email to: murray.income@abrdn.com.
Shareholders will find enclosed with this Annual Report an
Invitation Card and Form of Proxy for use in relation to the
AGM. Whether or not you propose to attend the AGM, you
are encouraged to complete the Form of Proxy in
accordance with the instructions printed on it and return it,
with the Invitation Card if you wish, in the prepaid envelope
as soon as possible but in any event so as to be received
no later than 12.30pm on 3 November 2023. Completion
of a Form of Proxy does not prevent you from attending
and voting in person at the AGM if you wish to do so.
If you hold your shares in the Company via a share plan or
a platform and would like to attend and/or vote at the
AGM, then you will need to make arrangements with the
administrator of your share plan or platform. For this
purpose, investors who hold their shares in the Company
via the abrdn Investments Plan for Children, the abrdn
Share Plan and/or the abrdn Investments Trust ISA will find
a Letter of Direction and Invitation Card enclosed.
Shareholders are encouraged to complete and return
both the Letter of Direction and Invitation Card in
accordance with the instructions printed thereon.
Further details on how to attend and vote at company
meetings for holders of shares via share plans and
platforms can be found at: www.theaic.co.uk/aic/
how-to-vote-your-shares
I always welcome questions from our shareholders at the
AGM. Alternatively, shareholders may submit questions to
the Board prior to the meeting by sending an email to:
murray.income@abrdn.com.
Update
From 30 June 2023 to 15 September 2023, being the latest
practicable date prior to approval of this Report, the NAV
per share (with debt at fair value) returned 2.6%
underperforming the FTSE All-Share Index which returned
3.3%, both figures on a total return basis.
8 Murray Income Trust PLC
A personal outlook
Over my term as a Director, I have invested around the
same amount buying Murray Income shares as I have
been paid in Directors’ remuneration. I intend to keep the
shares for the long-term. Why? Firstly, the starting yield is
important to me. My long-term financial planning targets
an overall compound annual growth rate of 4%-5%. If I
can achieve most of that from the starting yield of 4.5%
then the rest of the decision-making becomes easier. If
the dividend payments grow every year, that’s even
better. How about inflation protection? If inflation remains
high, the value of my future income will be eroded. That’s
one reason I favour Murray Income over long-term bonds.
Bonds, by definition, do not increase their dividend
payments. Equities can, and abrdn’s quality bias means
that I would expect Murray Income’s holdings to be more
resilient in such a scenario. Not total protection, but
enough to keep me from worrying.
What about the outlook for capital growth? Obviously, this
is harder to predict given the number and scale of known
and unknown scenarios. But as Charles and Iain argue in
their Investment Manager’s Report (see page 13), UK
equity valuations currently look unusually cheap in
absolute terms and relative to both their own history and
to world markets. The factors that have depressed UK
valuations (take your pick from politics, Covid, Brexit,
productivity, austerity, banks, quantitative easing and
inflation) are not necessarily permanent. The quality
companies within the UK market are to some extent
insulated from these factors and have, in certain cases,
been going from strength to strength, helping explain why
so many have been taken over by foreign companies. If
these quality companies in the portfolio can keep on
achieving revenue growth, the outlook for capital growth
is much improved.
In closing I’ll just focus on the investment numbers: the
Murray Income portfolio is presently trading on a price to
earnings multiple of 13.9x current year earnings. Average
dividend cover for those holdings is 2.0x. The current
dividend yield for the Company is 4.5% with that dividend
having increased every year for the past 50 years. All this
for an annual ongoing charges rate of around 0.50%.
May I thank you all for your support to me as Chair and for
your loyalty to the Company. It has been a great pleasure
and privilege to serve the Company. Murray Income will
be in good hands under Peter’s leadership and I trust that
you will share in its ongoing success.
Neil Rogan
Chair
19 September 2023
Chair’s Statement
Continued
Murray Income Trust PLC 9
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Background
For the UK economy, the year to 30 June 2023 (“the Year”)
has been characterised by high levels of inflation,
monetary policy tightening and concerns around a
potential recession. Equity markets have generally been
more robust than might have been expected against this
backdrop. The UK equity market ended the year +7.9%
higher on a total return basis, although with the path to
that level less than smooth. In September 2022, it was UK
politics that influenced domestic market performance.
The new Chancellor Kwarteng’s “mini budget” sparked a
wave of selling of UK gilts and a substantial weakening of
the pound which led to the Bank of England (“BoE”)
stepping in with emergency measures to stabilise
markets. UK government bond prices rose and the pound
recovered somewhat as first Chancellor Kwarteng and
then Prime Minister Truss resigned and many of their
previously announced tax cut proposals were reversed.
Then, in March 2023, the banking sector created volatility,
first in the US when Silicon Valley Bank collapsed and later
in the month when concerns grew over the viability of
Credit Suisse which was ultimately acquired by UBS.
Less transitory than these events have been the
persistently high level of inflation and the ongoing
response from central banks. UK inflation, as measured by
the Consumer Prices Index, reached 11.1% in October, the
highest level in more than four decades. Annual inflation
fell below 10% for the first time since the summer of 2022
in April when the reading was 8.7%, but data for May
showed that core inflation, which excludes volatile fuel
and unprocessed food costs, continued to rise. The BoE
acted to control inflation by raising interest rates multiple
times over the period, with the policy rate increasing from
1.25% at the start of the Year to 4.5% by the end of June
2023. After the year end, the BoE subsequently surprised
markets by hiking a further 0.5% in July, and then again by
an additional 0.25% in August, as inflation exceeded
expectations, although maintaining their forecast that
inflation will fall rapidly in the second half of 2023.
Despite rising interest rates, the UK has so far avoided a
technical recession (defined as two consecutive quarters
of negative growth in real GDP) and updated forecasts at
the start of the calendar year from the UK’s Office for
Budget Responsibility showed they now expect the
country to avoid a recession in 2023. Economic data for
the UK has been mixed over the period. GDP fell by -0.3%
in the quarter to September, followed by 0.1% increases in
the subsequent quarters to December and March.
Purchasing Managers’ Index data continued to show the
Services sector performing better than Manufacturing.
Labour markets have remained tight and there was
widespread strike action across multiple sectors.
Consumer confidence was reported to be at its lowest
level since records began in 1974, albeit retail sales
remained relatively robust.
This picture of high inflation and interest rate rises is
generally consistent across other developed markets.
Compared to the UK, inflation has softened more in the US
and the Eurozone in recent months and our view is that we
are nearing the end of hiking cycles in those economies. In
the US, although growth has so far fared better than
anticipated in the face of rate tightening and banking
sector concerns, we continue to forecast negative GDP
growth in 2024. China moved away from their zero-covid
policy in the final quarter of 2022. The policy change
initially led to a rise in covid cases which weighed on
growth, followed by a benefit to activity from the
reopening of the economy. However, the reopening
tailwind faded quicker than had been widely expected,
which prompted the government in Beijing to introduce
new measures intended to stimulate the economy. Oil and
other commodity prices declined over the Year over fears
of weakening demand. European gas prices fell sharply
from the mid-2022 highs reached following the Russian
invasion of Ukraine.
Global equity markets performed well over the Year, with
the MSCI World Index returning 19.2% over the period on a
total return basis in US dollar terms. In the UK, the FTSE All-
Share index (the Company’s “Benchmark”) lagged global
markets, rising by 7.9% with the FTSE 100 Index which has
more international exposure increasing by 8.9% and
outperforming the 3.0% rise in the FTSE 250 Index which
has more domestic exposure. From a factor perspective,
broadly-speaking ‘Value’ and ‘Momentum’ outperformed
while ‘Quality’ and ‘Growth’ stocks underperformed on a
relative basis.
Although a relatively small sector, the technology sector
performed strongly over the year mostly for individual
stock specific reasons. On the other hand the weakest
performance was seen in the telecoms sector as its main
constituents BT and Vodafone struggled operationally. In
a broad reversal of the prior year’s performance, some of
the more defensive areas of the market such as
healthcare and consumer staples underperformed while
perhaps surprisingly a number of the more cyclical,
economically-sensitive areas of the market such as
consumer discretionary and industrials outperformed.
Investment Mana
g
er’s Report
10 Murray Income Trust PLC
Performance
The Company generated a positive Net Asset Value per
share total return of 8.8% for the Year (based on debt at
fair value) outperforming the benchmark FTSE All-Share
Index which returned 7.9% over the Year. Changes in the
fair value of the Company’s long term debt aided
performance by approximately 1.3% reflecting the
favourable movement in the fair (or market) value of the
Company’s long-term gearing; as interest rates rose, the
market value of this liability fell. On a total return basis, the
Company’s share price increased by 4.9% which reflected
a widening of the discount to Net Asset Value (debt at fair
value) at which the shares traded from 4.5% to 8.2%.
Our investment process encompasses a patient buy and
hold approach and longer term returns also remain very
positive compared to the Benchmark. For example, over
five years, the share price and Net Asset Value per share
(based on debt at fair value) have outperformed the FTSE
All-Share Index by approximately 15% and 13%
respectively on a total return basis.
In absolute terms, taking account of the £60m of senior
secured fixed rate notes 2029, £40m of senior secured
fixed rate notes 2027, as well as £6.4m drawn down from
an unsecured multi-currency revolving credit loan facility
agreement with The Bank of Nova Scotia Limited, debt
was £106.5m at the end of the Year. The net gearing was
10.4% at the end of the Year as compared to 9.4% at the
end of the prior year.
Performance benefited from good stock selection in the
technology and consumer staples sectors offset by the
underweight exposure to energy and poor stock selection
in the consumer discretionary and industrials sectors.
Turning to the individual holdings, there were numerous
companies that demonstrated strong share price
increases. The share prices of VAT Group and Sage both
increased by over 45% during the Year. Non-held
companies British American Tobacco and Vodafone, and
the holdings in technology companies Sage and Aveva
generated the greatest stock level outperformance. As
we mentioned last year, we believed the portfolio was
vulnerable to corporate and takeover activity and during
the year bids were forthcoming for Euromoney, Aveva,
Industrials REIT, Dechra Pharmaceuticals and Countryside
Properties in aggregate benefiting relative performance.
The poorest share price performances were from
domestic companies exposed to higher inflation and/or
rising interest rates including Watkin Jones, Marshalls and
Direct Line. Marshalls, Direct Line and non-held HSBC and
Flutter provided the most significant negative relative
return over the Year.
Performance Attribution for the
year ended 30 June 2023
%
Net Asset Value total return for year per Ordinary share
(fair value)
+8.8
FTSE All Share Index total return
+7.9
Relative return
+0.9
Relative return
Stock selection
Energy
+0.1
Basic Materials
-0.5
Industrials
-1.5
Health Care
+0.2
Consumer Staples
+1.1
Consumer Discretionary
-0.9
Telecommunications
+0.5
Utilities
+0.1
Technology
+0.9
Financials
-0.7
Real Estate
+0.1
Total stock selection (equities)
-0.6
Asset allocation (equities)
Energy
-0.4
Industrials
+0.5
Health Care
+0.1
Consumer Staples
+0.1
Telecommunications
+0.1
Technology
+0.5
Financials
-0.1
Real Estate
-0.2
Total asset allocation (equities)
0.6
Management fees
-0.4
Administrative expenses
-0.1
Tax
-0.1
Cash & options
-0.5
Gearing – finance costs
+0.5
Gearing - difference between fair value and par value
returns
+1.3
Share buybacks
+0.3
Residual effect
-0.1
Total
+0.9
Notes: Stock Selection - measures the effect of equity selection relative to the
benchmark. Asset allocation – measures the impact of over or underweighting
each industry basket in the equity portfolio, relative to the benchmark weights.
Cash & options effect – measures the impact on relative returns of these
categories. Gearing – measures the impact on relative returns of net
borrowings. Management fees, administrative expenses and tax – these reduce
total assets and therefore reduce performance. Source - abrdn.
Investment Mana
g
er’s Report
Continued
Murray Income Trust PLC 11
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Portfolio Activity and Structure
Turnover of approximately 18% was the same as the prior
year. The pattern of trades reflected the ongoing desire to
improve, where possible, the quality of the portfolio and
maintaining the focus on attractive capital and dividend
growth. Active share (the proportion of the portfolio that
differs from the benchmark) remained stable at
approximately 70%.
The portfolio added five new holdings in the Year. Two of
these, Games Workshop and Genus, were UK mid-cap
company introductions. Games Workshop is a hobby
miniatures company which we see as a unique asset with
strong quality credentials and an attractive dividend yield.
Genus is a global leader in genetics and breeding,
contributing to improving sustainable food production. We
see Genus as having an attractive market position and
long-term growth potential from the development of
virus-resistant pigs.
The Company can invest up to 20% of gross assets in
overseas listed companies. This has three main benefits:
firstly, to provide access to industries not available to UK-
only investors; secondly, to diversify risk in concentrated
sectors in the UK market; and thirdly, to enable investment
in better quality proxies of UK listed companies. During the
year, three overseas holdings were added to the portfolio.
The first was Swiss-listed pharmaceutical company,
Roche, which has a healthy balance sheet and a pipeline
which we believe to be undervalued. The second was
LVMH, the luxury goods company listed in Paris which
offers strong long-term growth potential through its
portfolio of well-known brands. The final new overseas
holding added to the portfolio was Paris-listed cosmetics
and skincare company L’Oréal
which we see as having
strong quality characteristics, in particular: well-known
brands, appealing market growth dynamics and
attractive financial characteristics.
We increased exposure to several of our existing holdings
which we believe have high quality characteristics with
attractive growth prospects at appealing valuations
including Howden Joinery, Kone, Nestlé, Oversea-Chinese
Banking Corp, Oxford Instruments, London Stock Exchange
Group, RELX, Sage, and Unilever.
Fifteen holdings were sold during the Year, of which five
stocks were exited following takeover bids: Aveva, Dechra
Pharmaceuticals, Euromoney, Industrials REIT and
Countryside Partnerships (where we continue to have a
holding in the acquirer, Vistry). In the second half of 2022
we reduced the portfolio’s exposure to the real estate
sector. Watkin Jones was sold following a profit warning
which led to a change in confidence in the company’s
business model and concern about the risk of further
downgrades. Concern around high levels of leverage and
potential risk to dividends given rising discount rates and
higher interest charges also resulted in the sales of small
holdings in Assura, Sirius Real Estate, and Unite Group. The
residual position in Haleon, the consumer healthcare
business which was spun-out from GSK, was exited. XP
Power was exited as the outlook appeared increasingly
uncertain and the company has high leverage. The small
holding in Mowi was sold as call options written over the
holding were assigned. Finally, the small positions in
Ashmore, Bodycote and Weir were sold given more
attractive opportunities elsewhere.
In addition, we reduced the exposure to a number of
holdings where we have higher conviction in other names
in their respective sectors or to manage position sizes in
the portfolio. Positions in stocks including AstraZeneca,
Novo Nordisk, BHP, M&G, Standard Chartered and
TotalEnergies were trimmed.
Overall, the net effect of the purchases and sales has
been to reduce the number of holdings from 61 down to
52, providing a sharper focus to the portfolio.
We continued our measured option-writing programme
which is based on our fundamental analysis of the
holdings in the portfolio. The option-writing strategy has
been of benefit to the Company by diversifying and
increasing the level of income generated. It also provides
headroom to invest in companies with lower starting yields
but better dividend and capital growth prospects. Income
from writing options of £2.8m represented 5.6% of total
income earned in the Year.
Our aspiration in terms of portfolio construction is simple:
to invest in good quality companies with attractive growth
prospects through a sensibly diversified portfolio with
appealing dividend characteristics. Furthermore, the
ability to invest up to 20% of gross assets overseas is
helpful in achieving these aims with 13 overseas-listed
companies in the portfolio at the period end representing
approximately 18% of gross assets.
12 Murray Income Trust PLC
Environmental, Social and Governance
In line with our longer-term investment horizon, we
continue to put significant effort into engagement with the
companies in the portfolio to ensure that they are run in
shareholders’ best interests. Examples of the subjects of
our engagement during the Year have included topics
such as board composition, capital allocation, mergers
and acquisitions activity, and risk management (including
issues such as climate change, regulatory risk, and
management succession planning). We pursue these
issues through meetings with the executive management
of the companies as well as with the non-executives,
particularly the chairs of the board and remuneration
committees. MSCI independently rate the portfolio as AA
for its ESG characteristics and further detailed information
can be found in the Sustainable Investment Report on the
Company’s website at; murray-income.co.uk.
A small selection of examples include our
engagements with Games Workshop, Safestore and
Hiscox outlined below.
Having relatively recently initiated a position in Games
Workshop we chose to engage with the company more
actively on ESG-related matters. Of particular note, we
have flagged to the company that we believe that
enhancing diversity across the business should help
Games Workshop achieve a number of its goals, including
the sustaining of its strong culture and ambitions to further
develop their intellectual property and grow the customer
base through expanding geographically. We have written
to the company outlining our views and provided
examples of practices to support diversity we have
observed among our investee companies.
For a number of years we have voted against approval of
Safestore’s Remuneration Report owing to concerns
about a very generous incentive scheme introduced in
2017. However, we are supportive of the current board
and therefore, as one of Safestore’s largest shareholders,
this year we have engaged actively with the board on the
structure of a new remuneration policy. We have provided
feedback on multiple aspects of the policy proposal,
including striking a more balanced approach to base
salary and long-term incentives, incentivising and
retaining management of this high-performing company
and avoiding base salary growth for executive directors
ahead of the wider workforce.
We engaged with Hiscox in order to gain additional insight
into the company’s approach to ESG. The principal focus
of our engagement was the integration of climate-related
risks into underwriting. We were encouraged by the
company’s open dialogue on the areas of strength and
weakness in current datasets and modelling with respect
to climate-related risks and Hiscox’s approach to
enhancing its capabilities and generating opportunities for
new products. We have asked the company to enhance
disclosures with regards to social indicators, in particular
on human capital, and suggested that Hiscox consider
including social considerations into its Exclusions Policy
and set group sustainability targets beyond Greenhouse
Gas emissions reductions.
Income
For the Year, the Company witnessed a decrease in the
level of income due to lower dividends from the mining
sector holdings and a smaller amount of special dividends,
partly offset by higher interest income. Two special
dividends (paid by TotalEnergies and OSB Group) were
included in income from investments and were treated as
revenue items. We believe that this recognition is
appropriate given that, in each case, the return of cash
was from a build-up of profits generated by ongoing
operations rather than from a sale of assets.
The Company’s earnings per share decreased by 4.4%
from 40.5p to 38.7p. Paying a full year dividend of 37.5p per
share has allowed £2.2m to supplement the revenue
reserves which now represent 54% of the full year
dividend. We view the portfolio’s exposure to attractive
and enduring earnings trends as providing the potential
for appealing income growth over the long term.
Outlook
Recent data points provide a less than clear picture
around current conditions and future direction. However,
in most developed economies growth appears to be more
robust than might be expected in light of the meaningful
monetary policy tightening over the past 12 months. On
the other hand, the momentum of China’s reopening has
faded and more stimulus is likely to feature. Underlying
price pressures have been sticky reflecting excess
demand across various sectors and economies
prompting central banks to remain hawkish. We believe
that the current tightening cycle will ultimately restrict
economic growth with the resulting downturn in demand
helping to engineer a relatively rapid fall in inflationary
pressures allowing significant interest rate cuts over the
next 18 months.
Investment Mana
g
er’s Report
Continued
Murray Income Trust PLC 13
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The portfolio is jam-packed with high quality,
predominantly global businesses capable of delivering
appealing long term earnings and dividend growth at a
modest aggregate valuation. Our focus on quality
companies should provide protection through a downturn:
those companies with pricing power, high margins and
strong balance sheets are better placed to navigate a
more challenging economic environment and emerge in
a strong position. Furthermore, these quality
characteristics are helpful in underpinning the portfolio’s
income generation.
The valuations of UK-listed companies remain attractive
on a relative and absolute basis. Apart from the global
financial crisis, the UK’s market multiple is nearing its
lowest point for 30 years. It is cheap in absolute terms,
relative to history and also relative to global equities.
Investors are benefitting from global income at a knock-
down price. Moreover, the dividend yield of the UK market
remains at an appealing premium to other regional equity
markets. In summary, we feel optimistic that our long-
term focus on investments in high quality companies with
robust competitive positions and strong balance sheets,
which are led by experienced management teams will
be capable of delivering premium earnings and
dividend growth.
Charles Luke and Iain Pyle
Investment Manager
19 September 2023
14 Murray Income Trust PLC
Performance (total return, including reinvested dividends)
1 year return 3 year return 5 year return 10 year return
% % % %
Share price
A
+4.9 +23.4 +31.6 +73.2
Net asset value per Ordinary share (debt at fair value)
A
+8.8 +26.9 +29.7 +85.7
Net asset value per Ordinary share (debt at par value)
A
+7.5 +24.5 +27.2 +82.3
Benchmark
B
+7.9 +33.2 +16.5 +78.0
A
Considered to be an Alternative Performance Measure. Further details can be found on pages 105 and 106.
B
FTSE All-Share Index.
Source: abrdn & Morningstar
Ten Year Financial Record
Year end 30 June 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Income (£’000) 23,926 25,476 24,838 26,667 25,987 25,597 22,804 35,979 51,018 48,879
Shareholders’ funds (£’000) 547,652 515,888 515,036 576,462 570,929 587,150 534,361 1,093,859 1,009,255 999,184
Per Ordinary share (p)
Net revenue return 30.5 33.1 32.0 34.9 33.6 34.9 30.5 33.7 40.5 38.7
Dividends
A
31.25 32.00 32.25 32.75 33.25 34.00 34.25 34.50 36.00 37.50
Net asset value (capital only) 805.2 757.1 766.5 860.1 856.3 888.1 808.3 934.6 864.9 894.4
A
The figures for dividends per share reflect the years to which their declaration relates and not the years they were paid.
Performance
Murray Income Trust PLC 15
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Total Return of NAV with debt at fair value and Share Price vs FTSE All-Share Index
Five years ended 30 June 2023 (rebased to 100 at 30 June 2018)
70
80
90
100
110
120
130
140
30/06/18 30/06/19 30/06/20 30/06/21 30/06/22 30/06/23
Source: Morningstar & Lipper
Share Pri ce
NAV (debt at
fair value)
NAV (debt at
par)
FTSE All
Share
Share Price Discount to NAV with debt at fair value
Five years ended 30 June 2023
-12%
-10%
-8%
-6%
-4%
-2%
0%
30/06/2018 30/06/2019 30/06/2020 30/06/2021 30/06/2022 30/06/2023
Sou rce: abrdn & Lipper
16 Murray Income Trust PLC
Financial Highlights
30 June 2023 30 June 2022 % change
Shareholders’ funds (£’000) 999,184 1,009,255 –1.0
Net asset value (“NAV”) per Ordinary share – debt at fair value 911.7p 871.0p +4.7
NAV per Ordinary share – debt at par 894.4p 864.9p +3.4
Market capitalisation (£’000) 935,096 970,865 –3.7
Share price of Ordinary share 837.0p 832.0p +0.6
Discount to NAV on Ordinary shares – debt at fair value
A
8.2% 4.5%
Discount to NAV on Ordinary shares – debt at par
A
6.4% 3.8%
Gearing (ratio of borrowing to shareholders’ funds)
Net gearing
A
10.4% 9.4%
Dividends and earnings
Revenue return per share 38.7p 40.5p –4.4
Dividends per share
B
37.50p 36.00p +4.2
Dividend cover
A
1.03 times 1.13 times
Dividend yield
A
4.5% 4.3%
Revenue reserves (£’000)
Prior to payment of fourth interim dividend
C
36,664 33,491
After payment of fourth interim dividend 22,576 20,363
Operating costs
Ongoing charges ratio
A
0.50% 0.48%
A
Considered to be an Alternative Performance Measure. Further details can be found on pages 103 and 105.
B
The figures for dividends per share reflect the years in which they were earned (see note 7).
C
Per the Statement of Financial Position on page 65.
Dividends
Rate XD date Record date Payment date
First interim 8.25p 17 Nov 2022 18 Nov 2022 15 Dec 2022
Second interim 8.25p 16 Feb 2023 17 Feb 2023 16 Mar 2023
Third interim 8.25p 18 May 2023 19 May 2023 15 Jun 2023
Fourth interim 12.75p 17 Aug 2023 18 Aug 2023 14 Sep 2023
Total dividends 37.50p
Financial Hi
g
hli
g
hts and Dividends
Murray Income Trust PLC 17
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Business Model
Murray Income Trust PLC (the “Company”) is an
investment trust whose Ordinary shares are listed on the
premium segment of the London Stock Exchange.
The Company is governed by a Board of Directors (the
“Board”), all of whom are non-executive, and has no
employees. The Board is responsible for determining the
Company’s investment objective and investment policy.
Like other investment companies, the day-to-day
investment management and administration of the
Company is outsourced by the Board to an investment
management group, abrdn, and other third party
providers. The Company has appointed abrdn Fund
Managers Limited (see ‘Manager’ in Glossary on page
107) as its alternative investment fund manager, which
has in turn delegated certain functions, including
administration of the investment policy, to abrdn
Investments Limited (formerly Aberdeen Asset Managers
Limited). The Manager has delegated the company
secretarial function to abrdn Holdings Limited (formerly
Aberdeen Asset Management PLC).
The Company complies with Section 1158 of the
Corporation Tax Act 2010 which permits the Company to
operate as an investment trust.
Investment Objective
The Company aims for a high and growing income
combined with capital growth through investment in a
portfolio principally of UK equities.
Investment Policy
In pursuit of the Company’s investment objective, the
Company’s investment policy is to invest in the shares of
companies that have potential for real earnings and
dividend growth, while at the same time providing an
above-average portfolio yield. The emphasis is on the
management of risk and on the absolute return and yield
from the portfolio as a whole rather than the individual
companies which the Company invests in, which is
achieved by ensuring an appropriate diversification of
stocks and sectors within the portfolio, with a high
proportion of assets in strong, well-researched companies.
The Company makes use of borrowing facilities to enhance
shareholder returns when appropriate.
Delivering the Investment Policy
The Company maintains a diversified portfolio of the
equity securities of UK and overseas companies with an
emphasis on investing in quality companies with good
management, strong cash flow, a sound balance sheet
and which are generating a reliable earnings stream.
The Investment Manager follows a bottom-up investment
process based on a disciplined evaluation of companies,
including through direct visits by its fund managers. Stock
selection is the major source of added value,
concentrating on quality first, then price. Top-down
investment factors are secondary in the Investment
Manager’s portfolio construction with diversification rather
than formal controls guiding stock and sector weights.
Board Investment Limits
The Board sets additional investment guidelines within
which the Investment Manager must operate :
· the portfolio typically comprises between 40 and 70
holdings (but without restricting the Company from
holding a more or less concentrated portfolio from time
to time);
· the Company may invest up to 100% of its gross assets
in UK-listed equities and other securities and is permitted
to invest up to 20% of its gross assets in other overseas-
listed equities and securities;
· the Investment Manager may invest in any market
sector, however, the top five holdings may not exceed
40% of the total value of the portfolio and the top three
sectors represented in the portfolio may not exceed
50%; and
· the Company may invest no more than 15% of its gross
assets in other listed investment companies (including
investment trusts).
The Company may use derivatives for the purpose of
enhancing portfolio returns and for hedging purposes in a
manner consistent with the Company’s broader
investment policy. The Investment Manager is permitted
to invest in options and in structured products, provided
that any structured product issued in the form of a note or
bond has a minimum credit rating of “A”.
Gearing
The Board is responsible for setting the gearing policy of
the Company and for the limits on gearing. The Manager
is responsible for gearing within the limits set by the Board.
The Board has set its gearing limit at a maximum of 25% of
NAV at the time of draw down. Gearing - borrowing
money - is used selectively to leverage the Company’s
portfolio in order to enhance returns where this is
considered appropriate. Particular care is taken to ensure
that any financial covenants permit maximum flexibility of
investment policy. Significant changes to gearing levels
are communicated to shareholders.
Overview of Strate
g
y
18 Murray Income Trust PLC
Key Performance Indicators
At each Board meeting, the Directors consider a number of Key Performance Indicators (“KPIs”) to assess the
Company’s success in achieving its objectives, and these are described below, with those also categorised as Alternative
Performance Measures marked with an asterisk (see also pages 103 to 106):
KPI Description
NAV (total return) * relative to
the Company’s benchmark
The Board considers the Company’s NAV (total return), relative to the FTSE All-Share Index, to be
the best indicator of performance over different time periods. A graph showing NAV total return
performance against the FTSE All-Share Index over the past five years is shown on page 15.
Share price (total return) * The Board monitors share price performance relative to open-ended and closed-ended
competitor products, taking account of differing investment objectives and policies pursued by
those products.
The figures for share price (total return) for the Year and for the past three, five and ten years, as
well as for the NAV (total return) per share, are shown on page 14. A graph showing share price
total return performance against the FTSE All-Share Index over the past five years is shown on
page 15.
Discount/premium to NAV * The discount/premium at which the Company’s share price trades relative to the NAV per share is
closely monitored by the Board. A graph showing the discount/premium over the last five years is
shown on page 15.
Earnings and dividends per
share
The Board aims to meet the ‘high and growing’ element of the Company’s investment objective by
developing revenue reserves sufficient to support the payment of a growing dividend; figures may
be found in Financial Highlights and Dividends on page 16 in respect of earnings and dividends per
share, together with the level of revenue reserves, for the Year and previous year.
Ongoing charges* The Board monitors the Company’s operating costs and their composition with a view to limiting
increases wherever possible. Ongoing charges are disclosed on page 16 for the Year and the
previous year and include look through costs. The increase in ongoing charges from 0.48% to
0.50% reflects the lower average net assets over the Year, as compared to the prior year.
Principal Risks and Uncertainties
There are a number of risks and uncertainties which, if
realised, could have a material adverse effect on the
Company’s business model, future performance and
solvency. The Board, through the Audit Committee, has
put in place a robust process to identify, assess and
monitor these by means of a risk assessment and internal
controls system. This system was reviewed during the
year, as explained in the Audit Committee Report on
pages 51 and 52. As noted therein, the committee has a
risk register and uses a post-mitigation heat risk map to
identify principal, and emerging, risks.
Macroeconomic uncertainty has again been a significant
risk during the year due to rising interest rates and higher
inflation. The Board does not consider that the principal risks
and uncertainties identified have changed during the Year.
The Audit Committee and the Board both consider
emerging risks as part of their normal review of factors
which could affect the Company, both in the short and
longer term. For example, the emergence of negative
climate change impacts, high inflation and interest rates,
and potential conflicts (China and Taiwan tension) form a
part of Directors’ discussions with input from the Manager
and broker.
The following table sets out the Company’s principal risks
and uncertainties and the Company’s mitigating actions
and comments if the post-mitigation risk assessment has
changed, together with the reason why.
Overview of Strate
g
y
Continued
Murray Income Trust PLC 19
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Principal Risk Mitigating Action
STRATEGIC AND MARKET
The Company’s investment objective and policy are no longer
meeting investors’ requirements (unchanged)
Lack of a robust strategic review, failure to understand the
market/investor demand. Failure to analyse and react to
changes or uncertainty, unclear dividend policy.
The Company's investment objective and policy (“IOP”) are
reviewed regularly by the Board to ensure they remain
appropriate and effective. The Board holds an annual strategy
meeting at which strategy and approach is reviewed; this
includes consideration of distributions; both dividends and share
buy backs.
Discount control risk (unchanged)
Investment trust shares tend to trade at discounts to their
underlying NAVs, although they can also trade at premium.
Discounts and premiums can fluctuate considerably leading to
more volatile returns for shareholders.
The Board monitors the discount at which the Company’s
shares trade and will buy back or issue shares to try to minimise
the impact of any discount or premium volatility. Whilst these
measures seek to reduce volatility, they are not guaranteed to
do this.
As was the case in the prior year, the Board has assessed the
discount control risk as elevated due to the discount at which
the Company’s shares are trading as compared to their
underlying NAV.
Market risk (increased)
Market risk arises from the volatility in prices of the Company’s
investments and the potential loss the Company could suffer
through realising investments following negative market
movements.
Changes in general geopolitical, economic or market conditions,
such as interest rates, exchange rates and rates of inflation, as
well as global political events and trends could substantially and
adversely affect the prices of securities and, as a consequence,
the value of the Company’s investment portfolio, its prospects
and share price.
Current geopolitical risks include the ongoing Russian invasion of
Ukraine, rising tension between China and Taiwan.
The longer term emergence of the effects on investee
companies of climate change, and the regulatory environment
around this present a further risk.
The Company’s investment policy and its approach to risk
diversification may be found on page 17, both of which serve to
mitigate the effect of market risk on the portfolio. The Board
considers the diversification of the portfolio, asset allocation,
stock selection and levels of gearing on a regular basis. The
Board also monitors the Company’s relative performance as
compared to peers and the Company’s benchmark.
The Board assesses climate change as an emerging risk in terms
of how it develops, including how investor sentiment is evolving
towards climate change within investment portfolios, and will
consider how the Company may mitigate this risk, any other
emerging risks, if and when they become material.
The Board engages with the Manager, at each Board meeting,
as part of its ESG oversight, to understand how climate change,
and environmental factors are being assessed . Both are key
considerations within the Manager’s investment process
(see also pages 93 to 97 for further information on the
Manager’s approach to ESG).
During the Year, the Board evaluated market risk as elevated
due to the limit on the Company’s ability to mitigate the effect of
external factors such as the uncertainty caused by geopolitical
factors, rising inflation and cost pressures.
20 Murray Income Trust PLC
Overview of Strate
g
y
Continued
Gearing risk (increased)
The Company uses credit facilities. These arrangements
increase the funds available for investment. While this has the
potential to enhance investment returns in rising markets, in
falling markets the impact could be detrimental.
Credit facilities may not be available at an acceptable rate, term
or amount. The Company’s three year £50 million facility
matures on 27 October 2024.
Gearing is monitored and strict restrictions on borrowings are
imposed: gearing continues to operate within pre-agreed limits
so as not to exceed 25% of NAV at the time of draw down.
The Board and the Manager monitors the lending market and
will address at a germane time to enable the availability of
appropriate facilities if required.
INVESTMENT MANAGEMENT
Underperformance risk (unchanged)
Consistent underperformance by the Investment Manager over
short, medium and long term.
The Investment Manager’s style may result in the portfolio being
significantly over or under weight positions in stocks and sectors
compared to the benchmark and the Company’s performance
may deviate significantly from that of the benchmark and peers,
possibly for extended periods.
The Board evaluates performance at each board meeting on
both an absolute and relative basis, against the Company’s
benchmark and peers, and across various periods: short,
medium and long term. Performance is also reviewed at the
annual strategy meeting.
The Company has a set of investment limits and Board
guidelines which ensure diversification of the portfolio.
Risk of loss of key staff (increased)
Loss of key staff though natural loss, or Manager reorganisation
and/or redundancy. Loss of investor confidence if lead
manager lost.
Charles Luke has been the lead portfolio manager for the
Company since 2006. His co-manager is Iain Pyle who has been
with the Manager since 2015, and Rhona Millar, with five years’
experience, also works alongside them. All work within the
Manager’s 43-strong Developed Markets Equities team.
MARKETING
General marketing risk (increased)
Failure to implement the Board’s marketing policy. Failure to
address shareholder concerns or complaints, including of abrdn
Investment Trust Saving plans holders.
Issues could arise from the lack of process ownership, poor
procedures or the failure to appropriately manage distribution,
concerns or complaints of shareholders.
The Manager’s investor relations team works closely with the
Board on institutional shareholder contact. In addition, quarterly
updates are provided to the Board by the broker. All
correspondence addressed to the Board is circulated to
Directors while any complaints relating to the Company’s
savings plans are reviewed by the Board quarterly.
OPERATIONAL
Service provider risk (unchanged)
In common with most other investment companies, the
Company relies on the services provided by third parties and is
dependent on the control systems of the Manager (who acts as
investment manager, company secretary and maintains the
Company’s assets, dealing procedures and accounting
records); BNP Paribas Trust Corporation UK Limited (who acts
as Depositary and Custodian); and the registrar. The security of
the Company’s assets, dealing procedures, accounting records
and adherence to regulatory and legal requirements depend
on the effective operation of the systems of these third party
service providers.
Contracts with third party providers are entered into after
appropriate due diligence. Thereafter the performance of each
provider is subject to an annual review by the Audit Committee.
The Depositary reports to the Audit Committee at least
annually, including on the Company’s compliance with AIFMD.
The Manager also regularly reviews the performance of
the Depositary.
Global assurance reports are obtained from the Manager, BNP
Paribas Trust Corporation UK Limited and the registrar. These
are reviewed by the Audit Committee. The reports include an
independent assessment of the effectiveness of risks and
Murray Income Trust PLC 21
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Failure by any service provider to carry out its obligations could
have a material adverse effect on the Company’s performance.
Disruption, including that caused by information technology
breakdown or a cyber-related issue, could prevent, for example,
the functioning of the Company; accurate reporting to the
Board or shareholders; or payment of dividends in accordance
with the announced timetable.
internal controls at the service providers including their planning
for business continuity and disaster recovery scenarios, together
with their policies and procedures designed to address the risks
posed to the Company’s operations by cyber-crime. The Audit
Committee receives an annual update on the Manager’s
IT resilience.
The Company’s assets are subject to a strict liability regime and,
in the event of a loss of assets, the Depositary must return assets
of an identical type or the corresponding amount, unless able to
demonstrate the loss was a result of an event beyond its
reasonable control.
The Board has assessed the risk posed by cyber-crime as
elevated, despite the available mitigation, reflecting the potential
disruption which might be caused to the Company’s operations
by a cyber-attack.
The following are other risks identified by the Board which could have a major impact on the Company, but due to
mitigation are not deemed to be principal risks:
Other Risks Mitigating Action
Dividend risk
There is a risk that the Company fails to generate sufficient
income from its investment portfolio to meet the Company’s
dividend requirements.
A cut in the dividend of the Company would likely cause a
drop in the share price and would end the Company’s
“Dividend Hero” status.
The Board reviews estimates of revenue income and
expenditure prepared by the Manager.
The Company’s level of revenue reserves is monitored and can
be added to in years of surplus, or used to support the dividend in
years where there is a revenue deficit. Dividends can also be
paid from capital, though use of capital reserves for dividends is
expected to be rare.
Financial risk
The Company’s investment activities expose it to a variety of
financial risks which include market risk (which is identified as a
principal risk and is covered earlier in this section on page 19),
liquidity risk and credit risk (including counterparty risk).
Details of these risks and the policies and procedures for their
monitoring and mitigation are disclosed earlier in this section
and in note 18 on pages 81 to 87.
Regulatory risk, including change of existing rules and regulation
The Company is required to comply with relevant rules and
regulations. Failure to do so could result in loss of investment trust
status, fines, suspension of the Company’s shares, criminal
proceedings or financial or reputational damage.
The Manager provides investment, company secretarial,
administration and accounting services through qualified third
party professional providers.
The Board receives regular reports from its broker, depositary,
registrar and Manager as well as the industry trade body (the
Association of Investment Companies (“AIC”) on changes to
regulations which could impact the Company and its industry.
Emerging risk
Failure to have in place procedures that assist in identifying
emerging risks. This may cause reactive actions rather than
being pro-active and, in the worst case, could cause the
Company to become unviable or otherwise fail.
The Board regularly reviews all risks to the Company, including
emerging risks, which are identified by a variety of means,
including advice from AIC, the Company’s professional advisors,
Directors’ knowledge of markets, changes and events.
22 Murray Income Trust PLC
Overview of Strate
g
y
Continued
The principal risks associated with an investment in the Company’s shares can be found in the pre-investment disclosure
document (“PIDD”) published by the Manager, which is available from the Company’s website: murray-income.co.uk.
Promotional Activities
The Board recognises the importance of promoting the
Company to existing and prospective investors both for
improving liquidity and enhancing the rating of the
Company’s shares. The Board believes one effective way
to achieve this is through subscription to, and participation
in, the promotional programme run by the Manager on
behalf of a number of investment trusts under its
management. The Company also supports the Manager’s
investor relations programme which involves regional
roadshows, promotional and public relations campaigns.
The Manager’s promotional and investor relations teams
report to the Board on a quarterly basis giving analysis of
their activities as well as updates on the shareholder
register and any changes in the make-up of that register.
Communicating the long-term attractions of the
Company is key. The promotional programme includes
commissioning independent paid for research on the
Company, most recently from Edison Investment
Research Limited; a copy may be found on the
Company's website.
The UK Stewardship Code and Proxy Voting
The Company supports the UK Stewardship Code 2020,
and seeks to play its role in supporting good stewardship
of the companies in which it invests. Responsibility for
actively monitoring the activities of portfolio companies
has been delegated by the Board to the Manager
which has sub-delegated that authority to the
Investment Manager.
The Manager is a tier 1 signatory of the UK Stewardship
Code 2020 which aims to enhance the quality of
engagement by investors with investee companies in
order to improve their socially responsible performance
and the long term investment return to shareholders. The
Manager’s Annual Stewardship Report 2022 may be found
at abrdn.com. While delivery of stewardship activities has
been delegated to the Manager, the Board acknowledges
its role in setting the tone for the effective delivery of
stewardship on the Company’s behalf.
The Board has also given discretionary powers to the
Manager to exercise voting rights on resolutions proposed
by the investee companies within the Company’s portfolio.
The Manager reports to the Board on a six monthly basis
on stewardship (including voting) issues and additional
information may be found on page 97.
Global Greenhouse Gas Emissions and
Streamlined Energy and Carbon Reporting
(“SECR”)
All of the Company’s activities are outsourced to third
parties. The Company therefore has no greenhouse gas
emissions to report from the operations of its business, nor
does it have responsibility for any other emissions
producing sources under the Companies Act 2006
(Strategic Report and Directors’ Reports) Regulations
2013. For the same reason as set out above, the
Company considers itself to be a low energy user under
the SECR regulations and therefore is not required to
disclose energy and carbon information. Further
information on the Manager’s obligatory disclosures under
the Taskforce on Climate-related Financial Disclosures
(“TCFD”) may be found on page 96.
Viability Statement
The Company does not have a fixed period strategic plan
but the Board does formally consider risks and strategy on
at least an annual basis. The Board regards the Company,
with no fixed life, as a long term investment vehicle but for
the purposes of this viability statement has decided that a
period of five years (the “Review Period”) is an appropriate
timeframe over which to report. The Board considers that
this Review Period reflects a balance between looking out
over a long term horizon and the inherent uncertainties of
looking out further than five years.
In assessing the viability of the Company over the
Review Period the Directors have focused upon the
following factors:
· the Company’s principal risks and uncertainties as set
out in the Strategic Report on pages 18 to 22;
· the relevance of the Company’s investment objective;
· the demand for the Company’s shares as indicated by
the level of premium and/or discount;
· the level of income generated by the Company’s
portfolio as compared to its expenses;
· the overall liquidity of the Company’s investment
portfolio;
· the likelihood of the Company being able to continue to
meet the covenants under its current borrowing
arrangements, and the covenants attaching to any
replacement borrowing arrangements, over the next
five years;
Overview of Strate
g
y
Continued
Murray Income Trust PLC 23
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
· the £40m senior loan notes and £60m senior loan notes,
which are repayable in 2027 and in 2029, respectively;
and
· any requirement for the Company to repay or refinance
the drawn-down element of its three year £50 million
bank loan facility prior to, or at, its maturity in
October 2024.
In making this assessment, the Board has considered in
particular a large economic shock, such as a further
global pandemic, a period of increased stock market
volatility and/or markets at depressed levels, a significant
reduction in the liquidity of the portfolio, or persistent
inflationary pressures, or changes in investor sentiment or
regulation, and how these factors might affect the
Company’s prospects and viability in the future. The Board
undertook scenario analysis, incorporating income
forecasting, in reaching its conclusions, but recognising
that the Company’s expenses are significantly lower than
its total income.
Taking into account the Company’s current position and
the potential impact of its principal risks and uncertainties,
the Directors have a reasonable expectation that the
Company will be able to continue in operation and meet
its liabilities as they fall due for a period of five years from
the date of this Report.
Performance, Financial Position and Outlook
A review of the Company’s activities and performance
during the Year, including future developments, is set out in
the Chair’s Statement and in the Investment Manager’s
Report. These cover market background, investment
activity, portfolio strategy, dividend policy, gearing and
investment outlook. A comprehensive analysis of the
portfolio is provided on pages 27 to 31 while the full
portfolio of investments is published monthly on the
Company’s website. The Company’s Statement of
Financial Position on page 65 shows the assets and
liabilities at the year end. Borrowing facilities at the year
end comprised a mix of fixed and floating debt: a three
year £50 million bank loan, £40 million of senior loan notes
due for repayment in 2027 and £60 million of senior loan
notes due for repayment in 2029. Details of these are
shown in notes 13 and 14 respectively.
The future strategic direction and development of the
Company is regularly discussed as part of Board meeting
agendas. The Board also considers the Manager’s
promotional strategy for the Company, including effective
communications with shareholders. The Board intends to
maintain, for the year ending 30 June 2024, the strategy
set out in the Strategic Report as it believes that this is in
the best interests of shareholders.
Environmental, Community, Social and
Human Rights Issues
The Company has no employees and, accordingly, there
are no disclosures to be made in respect of employees. In
relation to the investment portfolio, the Board has
delegated assessment of these issues to the Investment
Manager, responsibility and further information may be
found on pages 93 to 97.
Modern Slavery Act
Due to the nature of its business, being a company that
does not offer goods and services to customers, the Board
considers that the Company is not within the scope of the
Modern Slavery Act 2015 because it has no turnover. The
Company is therefore not required to make a slavery and
human trafficking statement. The Board considers the
Company’s supply chains, dealing predominantly with
professional advisers and service providers in the financial
services industry, to be low risk in relation to this matter.
Board Diversity
At 30 June 2023, there were three male Directors and
three female Directors (2022 – three male Directors and
three female Directors). Further information on Board
diversity may be found in the Directors’ Report on pages
38 and 39.
The Strategic Report has been approved by the Board and
signed on its behalf by:
Neil Rogan
Chair
19 September 2023
24 Murray Income Trust PLC
The Board is required to report how it has discharged its
duties and responsibilities under section 172 of the
Companies Act 2006 during the Year. Under this
requirement, the Directors have a duty to promote the
success of the Company for the benefit of its members
(shareholders) as a whole, taking into account the likely
long term consequences of decisions, the need to foster
relationships with the Company’s stakeholders, and the
impact of the Company’s operations on the environment.
In addition the Directors must act fairly between
shareholders and be cognisant of maintaining the
reputation of the Company.
The Purpose of the Company and Role
of the Board
The Company has been established as an investment
vehicle for the purpose of delivering its investment
objective which is set out on the inside front cover of this
Report. Investment trusts, such as the Company, are long-
term investment vehicles that are typically externally-
managed, have no employees, and are overseen by an
independent non-executive board of directors.
The Board is responsible for all decisions relating to the
Company’s investment objective and policy, gearing,
corporate governance and strategy, and for monitoring
the performance of the Company’s third party service
providers, including the Manager.
The Board’s philosophy is that the Company should foster
a culture where all parties are treated with respect. The
Directors provide mutual support combined with
constructive challenge. Integrity, openness and diligence
are defining characteristics of the Board’s culture. The
Company has a number of policies and procedures in
place to aid a culture of good governance, such as those
relating to Director’s conflicts of interests and dealings in
the Company’s shares, annual evaluation of Directors,
anti-bribery and anti-tax evasion. At its regular meetings,
the Board engages with the Manager to understand its
culture and receives regular reporting and feedback from
the other key service providers.
The Company’s primary stakeholders have been
identified as its shareholders, the Manager, other key
third party service providers, lenders and investee
companies and the following table sets out details of
the Company’s engagement.
Shareholders The Directors place great importance on communication with shareholders. Further details on the
Company’s relations with Shareholders, including its approach to the Annual General Meeting, and
investor relations can be found in the Directors’ Report on page 43.
In addition, the Chair and Investment Manager are holding an online shareholder presentation on 3
November 2023, further details of which may be found in the Chair’s Statement on page 7.
Manager The Investment Manager’s Report on pages 9 to 13 details the key investment decisions taken during
the Year. The Board engages with the Investment Manager at every Board meeting and receives
presentations from the Investment Manager to help it to exercise effective oversight of the Investment
Manager and delivery of the Company’s strategy. The Board also receives regular updates from the
Manager outside of these meetings.
The Management Engagement Committee’s monitoring of the performance of the Manager over the
Year is detailed on pages 40 and 41.
Other Key Third Party
Service Providers
The Board ensures that it promotes the success of the Company by engaging specialist third party
suppliers with the resources, controls and performance records to deliver the service required. The
Board seeks to maintain constructive relationships with its key service providers (the Company’s
registrar, depositary and broker) either directly, or through the Manager, with ongoing dialogue and
formal regular meetings. The Audit Committee conducts an annual assessment of key service providers
as set out in the Committee’s report on page 52. The Board seeks regular assurance that key third party
service providers have in place appropriate business continuity plans and which are expected to allow
them to maintain service levels in the face of disruption.
Promotin
g
the Success of the Company
Murray Income Trust PLC 25
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Investee Companies The Board is committed to investing in a responsible manner and actively monitors the activities of
investee companies through its delegation to the Investment Manager. In order to achieve this, the
Investment Manager has discretionary powers to exercise voting rights on resolutions proposed by the
investee companies and reports quarterly to the Board on stewardship issues, including voting. The
Board monitors investments made and divested and questions the rationale for exposures taken and
voting decisions made.
Information on how the Investment Manager engages with investee companies may be found on
pages 12 and 97.
Lenders to the Company On behalf of the Board, the Manager maintains a positive working relationship with the provider of the
Company’s multi-currency loan facility and the holders of the Company’s Senior Loan Notes, assuring
compliance with lenders’ covenants and providing regular updates on business activity.
Specific Examples of Stakeholder
Consideration During the Year
While the importance of giving due consideration to the
Company’s stakeholders is not a new requirement, and is
considered as part of every Board decision, the Directors
were particularly mindful of stakeholder considerations
during the following decisions reached during the Year.
Dividends Paid to Shareholders
The level, frequency and timing of dividends paid are key
considerations for the Board, taking into account net
earnings for the year and the Company’s objective of
providing shareholders with a high and growing income,
combined with the Company’s Dividend Hero status.
The total dividend per share of 37.5p in respect of the
Year, representing an increase of 4.2% on the prior year,
and the Company’s dividend policy to make four equally-
spaced payments to shareholders throughout the Year,
reflects these considerations.
Share Buy Backs
During the Year the Company bought back 4,970,471
Ordinary shares to be held in treasury, representing a
significant increase on the 356,015 Ordinary shares
bought back in the previous year, providing a small
accretion to the NAV and a degree of liquidity to the
market at times when the discount to the NAV per share
had widened during normal market conditions. It is the
view of the Board that this policy remains in the best
interests of all shareholders.
Board Succession
The Board, via the Nomination Committee, reviewed its
succession plan in light of Directors’ retirement at the AGM
on 7 November 2023. Further information may be found in
the Directors’ Report on page 41.
Shareholder Communication
The Chair hosted an online event for shareholders on 2
November 2022. This event was arranged to allow those
shareholders who may have been unable to attend the
AGM in person on 1 November 2022 to pose questions to
both the Chair and the Investment Manager. A similar
event will be held on 3 November 2023, as described in the
Chair's Statement on page 7.
26 Murray Income Trust PLC
Portfolio
A world leader in luxury, LVMH
(a portfolio company purchased
this year) drives long-term
momentum to develop its 75
brands, including Moet Chandon,
respecting their distinctive identities.
Murray Income Trust PLC 27
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
As at 30 June 2023
RELX
AstraZeneca
RELX is a global provider of information
and analytics for professionals and
businesses across a number of
industries including scientific, technical,
medical and law. The company offers
resilient earnings combined with long
term structural growth opportunities.
AstraZeneca researches, develops,
produces and markets
pharmaceutical products. With a
significant focus on oncology and rare
diseases, the company offers
appealing growth potential over the
medium term.
Unilever
Diageo
Unilever is a global consumer goods
company supplying food, home and
personal care products. The company
has a portfolio of strong brands
including: Dove, Knorr, Axe and Persil.
Over half of the company’s sales are to
developing and emerging markets.
Diageo produces, distills and markets
alcoholic beverages including vodkas,
whiskies, tequilas, gins and beer. The
company should benefit from
attractive long term drivers such as
population and income growth, and
premiumisation. The company has a
variety of very strong brands and faces
limited private label competition.
SSE
TotalEnergies
SSE is a utility company mostly focused
on networks and renewables. The path
to net zero will require significant
investment in distribution networks
and the company should also benefit
from its strong position in offshore
wind generation.
TotalEnergies is a broad energy
company that produces and markets
fuels, natural gas and electricity. It is a
leader in the sector’s energy transition
with an attractive pipeline of
renewable assets
BHP Group
London Stock Exchange
BHP Group (formerly BHP Billiton) is a
diversified resources group with a
global portfolio of high quality assets
particularly iron ore and copper. The
company provides an appealing
dividend yield combined with a strong
balance sheet.
London Stock Exchange is a diversified
global financial markets infrastructure
and data business. The company is
highly cash generative and very well
placed to benefit from increased
spend on data services.
BP
Sage Group
BP is a fully integrated energy
company involved in exploration,
production, refining, transportation and
marketing of oil and natural gas. We
believe the industry is currently in a
sweetspot with robust prices and
benign costs. The company provides
an attractive dividend yield and is well
placed for the energy transition.
Sage Group is a market leading
software business focused on
accounting, payroll and payments. The
company has a strong product suite
and is well placed to benefit from the
software automation of its small and
mid-sized customers over the
medium term.
Ten Lar
g
est Investments
28 Murray Income Trust PLC
Portfolio
As at 30 June 2023
Valuation Total Valuation
2023 investments 2022
Investment FTSE All-Share Sector Country £’000 % £’000
RELX Media UK 61,856 5.6 45,388
AstraZeneca Pharmaceuticals and Biotechnology UK 60,904 5.6 69,318
Unilever Personal Care, Drug and Grocery Stores UK 56,200 5.1 34,656
Diageo Beverages UK 52,951 4.8 55,310
SSE Electricity UK 37,940 3.5 35,431
TotalEnergies Oil, Gas and Coal France 34,369 3.1 37,496
BHP Group Industrial Metals and Mining UK 33,932 3.1 36,349
London Stock Exchange Finance and Credit Services UK 33,912 3.1 17,862
BP Oil, Gas and Coal UK 32,387 3.0 27,437
Sage Group Software and Computer Services UK 30,020 2.7 13,676
Top ten investments 434,471 39.6
Coca-Cola HBC Beverages UK 29,787 2.7 23,144
Experian Industrial Support Services UK 29,324 2.7 20,282
Rentokil Initial Industrial Support Services UK 26,708 2.4 20,624
Close Brothers Banks UK 26,700 2.4 21,839
Inchcape Industrial Support Services UK 25,899 2.4 23,151
Anglo American Industrial Metals and Mining UK 25,065 2.3 26,093
National Grid Gas, Water and Multi-utilities UK 24,156 2.2 24,423
Novo-Nordisk Pharmaceuticals and Biotechnology Denmark 22,239 2.0 20,888
Safestore Real Estate Investment Trusts UK 21,600 2.0 23,659
Oversea-Chinese Banking Banks Singapore 21,124 1.9 14,833
Top twenty investments 687,073 62.6
Intermediate Capital Investment Banking and Brokerage Services UK 20,793 1.9 10,929
Howden Joinery Retailers UK 20,155 1.8 15,780
Microsoft Software and Computer Services United States 17,865 1.6 11,452
Oxford Instruments Electronic and Electrical Equipment UK 17,179 1.6 7,962
Nordea Bank Banks Sweden 16,694 1.5 14,075
Genus Pharmaceuticals and Biotechnology UK 16,314 1.5 –
Croda International Chemicals UK 15,982 1.5 18,387
Games Workshop Leisure Goods UK 15,579 1.4 –
Convatec Medical Equipment and Services UK 15,569 1.4 17,025
Vistry Household Goods and Home Construction UK 15,219 1.4 12,639
Top thirty investments 858,422 78.2
Portfolio
Murray Income Trust PLC 29
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
As at 30 June 2023
Valuation Total Valuation
2023 investments 2022
Investment FTSE All-Share Sector Country £’000 % £’000
M&G Investment Banking and Brokerage Services UK 14,862 1.4 17,707
OSB Finance and Credit Services UK 14,469 1.3 14,469
Smith & Nephew Medical Equipment and Services UK 14,091 1.3 8,946
Hiscox Non-life Insurance UK 13,985 1.3 8,922
Nestlé Food Producers Switzerland 13,694 1.3 15,523
Kone Industrial Engineering Finland 13,653 1.2 9,047
GSK Pharmaceuticals and Biotechnology UK 12,630 1.1 20,068
Drax Electricity UK 12,568 1.1 13,933
VAT Group Electronic and Electrical Equipment Switzerland 12,447 1.1 7,486
LVMH Personal Goods France 12,325 1.1 –
Top forty investments 993,146 90.4
Standard Chartered Banks UK 12,085 1.1 29,465
Roche Pharmaceuticals and Biotechnology Switzerland 9,919 0.9 –
Direct Line Insurance Non-life Insurance UK 9,445 0.9 17,493
Telenor Telecommunications Service Providers Norway 9,323 0.9 12,742
Mondi General Industrials UK 9,251 0.8 11,227
L’Oréal Personal Goods France 9,181 0.8 –
Marshalls Construction and Materials UK 8,779 0.8 16,346
RS Group Industrial Support Services UK 8,771 0.8 10,027
Genuit Construction and Materials UK 8,519 0.8 10,162
Chesnara Life Insurance UK 7,138 0.6 7,389
Top fifty investments 1,085,557 98.8
Accton Technology Telecommunications Equipment Taiwan 7,051 0.7 5,273
Moonpig Retailers UK 5,703 0.5 7,278
Total investments 1,098,311 100.0
Ordinary shares unless otherwise stated.
30 Murray Income Trust PLC
Investments held at 30 June 2023 (percentage of portfolio)
0% 5% 10% 15% 20% 25%
Basic Materials
Consumer Discretionary
Consumer Staples
En e rgy
Financials
Health Care
In dus trials
Real Estate
Technology
Telecomm unications
Utilities
Company
FTSE All-Share
Investments held at 30 June 2022 (percentage of portfolio)
0% 5% 10% 15 % 20% 25%
Basic Materials
Consumer Discretionary
Consu mer Staples
Ene rgy
Financials
Health Care
In dus trials
Real Estate
Technology
Telecomm unications
Utilities
Company
FTSE All-Share
Sector Comparison with the Benchmark
Murray Income Trust PLC 31
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Valuation Valuation
30 June 2022 Transactions Gains/(losses) 30 June 2023
£’000 % £’000 £’000 £’000 %
Equities
UK 942,138 85.7 (56,917) 13,206 898,427 81.8
Denmark 20,888 1.9 (5,434) 6,785 22,239 2.0
Finland 9,047 0.8 3,581 1,025 13,653 1.3
France 37,496 3.4 12,068 6,311 55,875 5.1
Norway 20,582 1.9 (5,491) (5,768) 9,323 0.9
Singapore 14,833 1.4 5,718 573 21,124 1.9
Switzerland 23,009 2.1 10,892 2,159 36,060 3.3
Sweden 14,075 1.3 – 2,619 16,694 1.5
Taiwan 5,273 0.5 – 1,778 7,051 0.6
United States 11,452 1.0 2,499 3,914 17,865 1.6
Total investments 1,098,793 100.0 (33,084) 32,602 1,098,311 100.0
Summary of Investment Chan
g
es Durin
g
the Year
32 Murray Income Trust PLC
Governance
Murray Income Trust PLC 33
Games Workshop was introduced to the portfolio
in the year under review. This unique mid-cap
company owns strong intellectual property
through its fantasy wargame ‘Warhammer’
series. The Manager’s engagement with the
company is described on page 12.
34 Murray Income Trust PLC
Neil Rogan
Independent Chair
Length of service
9 years; appointed Chair on 6 November 2017
Experience and other public
company directorships:
Neil Rogan, who was appointed a Director on 26
November 2013, is former Head of the Global Equities
Teams at both Gartmore and Henderson and former
Head of International Equities as well as a former member
of the Investment Division Executive Committee at
Gartmore. He previously managed Fleming Far Eastern
Investment Trust. He is non-executive chairman of Invesco
Asia Trust plc and a non-executive director of JPMorgan
Global Growth & Income plc.
Committee Membership:
Management Engagement Committee (Chair),
Nomination Committee (Chair) and Remuneration
Committee.
Contribution:
The Nomination Committee has reviewed the contribution
of Neil Rogan and has concluded that he continues to
chair the Company expertly, fostering a collaborative
spirit between the Board and Manager while ensuring that
meetings remain focussed on the key areas of
stakeholder relevance. Neil Rogan will retire as a Director
at the conclusion of the AGM on 7 November 2023.
Peter Tait
Senior Independent Non-Executive Director and Chair of
the Remuneration Committee
Length of service
5 years; appointed Senior Independent Director on 2
November 2021
Experience and other public
company directorships:
Peter Tait, who was appointed a Director on 7 November
2017, retired from the Nestlé Group where he was initially
Head of Investments for the Nestlé UK Pension Fund and
then CEO & CIO of Nestlé Capital Management. Prior to
Nestlé he worked for many years in the investment
management industry managing portfolios for investment
trusts, pension funds and charitable foundations. During
that time he was a managing director at BlackRock
International and, before that, a director of Dunedin Fund
Managers and a portfolio analyst at Scottish Widows Life
Assurance Fund.
Committee Membership:
Audit Committee, Management Engagement Committee,
Nomination Committee and Remuneration Committee
(Chair).
Contribution:
The Nomination Committee has reviewed the contribution
of Peter Tait in light of his proposed re-election as a
Director, and his appointment as Chair of the Company at
the conclusion of the forthcoming AGM, and considers
that he continues to bring to the Board his knowledge of
investment management as well as experience of
investment companies.
Board of Directors
Murray Income Trust PLC 35
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Stephanie Eastment
Independent Non-Executive Director and Chair of the
Audit Committee
Length of service
5 years; appointed Chair of the Audit Committee on 5
November 2018
Experience and other public
company directorships:
Stephanie Eastment, appointed a Director on 2 August
2018, was formerly Head of Specialist Fund Accounts and
Corporate Secretariat at Invesco Perpetual. Her career
spans over 35 years working in financial services including
roles at UBS, Wardley Investment Services International
and KPMG. She qualified while at KPMG and is a Fellow of
the Institute of Chartered Accountants in England and
Wales and a Fellow of the Institute of Chartered
Secretaries and Administrators. She is an independent
non-executive director and audit chair of Herald
Investment Trust plc, Impax Environmental Markets plc
and Alternative Income REIT plc. She is an independent
non-executive director of RBS Collective Investment
Funds Limited.
Committee Membership:
Audit Committee (Chair), Management
Engagement Committee, Nomination Committee and
Remuneration Committee.
Contribution:
The Nomination Committee has reviewed the contribution
of Stephanie Eastment in light of her proposed re-election
at the forthcoming AGM and has concluded that she
continues to chair the Audit Committee expertly as well as
bringing to the Board her extensive knowledge of the
governance of investment companies .
Merryn Somerset Webb
Independent Non-Executive Director
Length of service
4 years
Experience and other public
company directorships:
Merryn Somerset Webb, who was appointed a Director on
7 August 2019. She is a senior columnist for Bloomberg
Opinion covering personal finance and investment.
Previously, she was editor-in-chief of MoneyWeek and a
contributing editor at the Financial Times. She is a non-
executive director of BlackRock Throgmorton Trust plc.
Committee Membership:
Audit Committee, Nomination Committee and
Remuneration Committee.
Contribution:
The Nomination Committee has reviewed the contribution
of Merryn Somerset Webb and has concluded that she
continued to bring to the Board her expertise relating to
the promotion of investment companies in addition to her
wider experience in the sphere of personal finance.
Merryn Somerset Webb is not seeking re-election as a
Director at the forthcoming AGM.
36 Murray Income Trust PLC
Alan Giles
Independent Non-Executive Director
Length of service
2 years
Experience and other public
company directorships:
Alan Giles was appointed a Director on 17 November 2020
after serving as a director of Perpetual Income and
Growth Investment Trust plc from 6 November 2015. He is
Chairman of The Remuneration Consultants Group, an
Associate Fellow at Saïd Business School, University of
Oxford, and an honorary visiting professor at Bayes
Business School, City, University of London. He was
formerly Chairman of Fat Face Group Limited, Chief
Executive of HMV Group plc, Managing Director of
Waterstones, and an executive director of WH Smith plc.
He previously held non-executive directorships at Foxtons
Group plc, The Competition & Markets Authority, Rentokil
Initial plc, The Office of Fair Trading, Somerfield plc and
Wilson Bowden Plc.
Committee Membership:
Audit Committee, Management Engagement Committee,
Nomination Committee and Remuneration Committee.
Contribution:
The Nomination Committee has reviewed the contribution
of Alan Giles in light of his proposed re-election at the
forthcoming AGM, and his appointment as Senior
Independent Director at the conclusion of the forthcoming
AGM. and considers that his extensive boardroom
experience, particularly in the retail and
other commercial sectors, broadens the Board’s
overall expertise.
Nandita Sahgal Tully
Independent Non-Executive Director
Length of service
1 year, 10 months
Experience and other public
company directorships:
Nandita Sahgal Tully, who was appointed a Director on 3
November 2021, is a Fellow of the Institute of Chartered
Accountants in England and Wales and a Member of the
Chartered Institute for Securities and Investment. She was
a Managing Director at ThomasLloyd, an impact investor
focusing on clean energy and ESG, from 2017 to 2023.
Committee Membership:
Audit Committee, Management Engagement Committee,
Nomination Committee and Remuneration Committee.
Contribution:
The Nomination Committee has reviewed the contribution
of Nandita Sahgal Tully in light of her proposed re-election
at the forthcoming AGM and has concluded that she
brings to the Board investment management expertise
with a particular focus on ESG.
Board of Directors
Continued
Murray Income Trust PLC 37
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The Directors present their report and the audited
financial statements for the year ended 30 June 2023.
Results and Dividend Policy
The financial statements for the Year indicate a total
return attributable to equity shareholders for the year of
£73,486,000 (2022 – loss of £41,101,000) and an
explanation for the Company’s financial performance
may be found in the Chair’s Statement on pages 4 to 8.
On 1 November 2022, the Company declared a first
interim dividend of 8.25p per share to be paid on 15
December 2022, a second interim dividend of 8.25p per
share to be paid on 16 March 2023 and a third interim
dividend of 8.25p per share to be paid on 15 June 2023.
The Company further announced, on 1 August 2023, the
payment to shareholders on 14 September 2023 of a
fourth interim dividend for the year of 12.75p per share
(2022 – 11.25p) with an ex-dividend date of 18 August
2022 and a record date of 17 August 2023. This resulted in
total dividends of 37.5p per share for the year ended 30
June 2023, an increase of 4.2% on the 36.0p per share paid
for the prior year, which represented the 50
th
year of
consecutive growth in the Company’s annual dividend.
The Board is proposing to maintain the dividend policy of
paying four interim dividends each year. In line with good
corporate governance, the Board therefore proposes to
put the Company’s dividend policy to Shareholders for
approval at the AGM as resolution 4. At the AGM on 1
November 2022, shareholders approved a dividend policy
to pay four quarterly interim dividends per year.
Principal Activity and Status
The Company, which was incorporated in 1923, is
registered as a public limited company in Scotland under
company number SC012725 and is an investment
company within the meaning of Section 833 of the
Companies Act 2006.
The Company has been accepted by HM Revenue &
Customs as an investment trust subject to the Company
continuing to meet the relevant eligibility conditions of
Section 1158 of the Corporation Tax Act 2010 and the
ongoing requirements of Part 2 Chapter 3 Statutory
Instrument 2011/2999 for all financial years commencing
on or after 1 July 2012. The Directors are of the opinion
that the Company has conducted its affairs during the
Year so as to enable it to comply with the ongoing
requirements for investment trust status.
The Company has conducted its affairs so as to satisfy the
requirements as a qualifying security for Individual Savings
Accounts. The Directors intend that the Company will
continue to conduct its affairs in this manner.
Capital Structure and Voting Rights
At 30 June 2023, the Company had 111,720,001 (2022 –
116,690,472) fully paid Ordinary shares of 25p each with
voting rights in issue and an additional 7,809,531 (2022 –
2,839,060) shares in Treasury. During the Year, 4,970,471
Ordinary shares were bought back into Treasury
(2022 – 356,015).
Since the year end, the Company has bought back a
further 1,788,000 Ordinary shares into treasury.
Accordingly, as at the date of this Report, the Company’s
issued share capital consisted of 109,932,001 Ordinary
shares of 25 pence each and 9,597,531 Ordinary shares
held in treasury.
Ordinary shareholders are entitled to vote on all
resolutions which are proposed at general meetings of the
Company. The Ordinary shares, excluding shares in
Treasury, carry a right to receive dividends. On a winding
up, after meeting the liabilities of the Company, the surplus
assets will be paid to Ordinary shareholders in proportion
to their shareholdings. There are no restrictions on the
transfer of Ordinary shares in the Company other than
certain restrictions which may be applied from time to
time by law (for example, laws prohibiting insider trading).
Manager and Company Secretary
The Manager has been appointed by the Company, under
a management agreement, to provide investment
management, risk management, administration and
company secretarial services as well as promotional
activities. The Company’s portfolio is managed by the
Investment Manager by way of a group delegation in
place with the Manager. In addition, the Manager has
sub-delegated promotional activities to the Investment
Manager and administrative and secretarial services to
abrdn Holdings Limited.
Under the management agreement, the Manager is
entitled to a monthly fee of one-twelfth of: 0.55% pa on the
first £350 million of net assets, 0.45% pa on net assets
between £350 million and £450 million and 0.25% pa on
any net assets in excess of £450 million.
The value of any investments in unit trusts, open ended
and closed ended investment companies and investment
trusts of which the Manager, or another company within
abrdn, is the operator, manager or investment adviser, is
deducted from net assets when calculating the fee.
Directors’ Report
38 Murray Income Trust PLC
The management agreement is terminable on not less
than three months’ notice. In the event of termination by
the Company on less than the agreed notice period,
compensation is payable to the Manager in lieu of the
unexpired notice period.
An annual secretarial fee of £75,000 (plus applicable VAT)
is payable to abrdn Holdings Limited, which is chargeable
100% to revenue. An annual fee equivalent to up to 0.05%
of gross assets (calculated at 30 September each year) is
paid to the Investment Manager to cover promotional
activities undertaken on behalf of the Company.
The finance costs and investment management fees
are charged 70% to capital and 30% to revenue in line
with the Board’s expectation of the split of future
investment returns.
The management, secretarial and promotional activity
fees paid to subsidiaries of abrdn during the Year are
shown in notes 4 and 5 to the financial statements.
External Agencies
The Board has contractually delegated to external
agencies, including the Manager and other service
providers, certain services including: the management of
the investment portfolio, the day-to-day accounting and
company secretarial requirements, the depositary
services (which include cash monitoring, the custody and
safeguarding of the Company’s financial instruments and
monitoring the Company’s compliance with investment
limits and leverage requirements) and the share
registration services. Each of these contracts was entered
into after full and proper consideration by the Board of the
quality and cost of services offered in so far as they relate
to the affairs of the Company. In addition, ad hoc reports
and information are supplied to the Board as requested.
Directors
As at the date of this Report, the Board consisted of a non-
executive Chair and five non-executive Directors.
Neil Rogan, Stephanie Eastment, Peter Tait, Merryn
Somerset Webb, Alan Giles and Nandita Sahgal Tully were
Directors throughout the Year. Peter Tait is the Senior
Independent Director.
Board Diversity
The Board recognises the importance of having a range
of skilled, experienced individuals with the right knowledge
represented on the Board in order to allow it to fulfil its
obligations. The Board also recognises the benefits and is
supportive of, and will give due regard to, the principle of
diversity in its recruitment of new Board members. The
Board will not display any bias for age, gender, race,
sexual orientation, socio-economic background, religion,
ethnic or national origins or disability in considering the
appointment of Directors. The Board will continue to
ensure that all appointments are made on the basis of
merit against the specification prepared for each
appointment. The Board will take account of the targets
set out in the FCA’s Listing Rules, which are set out below.
The Board has resolved that the Company’s year end
date is the most appropriate date for disclosure purposes.
The following information has been provided by each
Director through the completion of questionnaires.
Table for reporting on sex as at 30 June 2023
Number of
board
members
Percentage of
the board
Number of senior
positions
on the board
(CEO, CFO,
Chair and SID)
Number in
executive
management
Percentage of
executive
management
Men 3 50%
n/a
(note 3)
n/a
(note 3)
n/a
(note 3)
Women 3 50% (note 1)
Not specified/prefer not to say - -
Directors’ Report
Continued
Murray Income Trust PLC 39
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Table for reporting on ethnic background as at 30 June 2023
Number of
board
members
Percentage of
the board
Number of senior
positions
on the board
(CEO, CFO,
Chair and SID)
Number in
executive
management
Percentage of
executive
management
White British or other White
(including minority-white groups)
5 83.3%
n/a
(note 3)
n/a
(note 3)
n/a
(note 3)
Asian/Asian British 1 16.7% (note 2)
Not specified/prefer not to say - -
Notes:
1. Meets target that at least 40% of Directors are women as set out in LR 9.8.6R (9)(a)(i).
2. Meets target that at least one Director is from a minority ethnic background as set out in LR 9.8.6R (9)(a)(iii).
3. This column is not applicable as the Company is externally managed and does not have any executive staff,
specifically it does not have either a CEO or CFO. The Company considers that the roles of Chair of the Board, Senior
Independent Director and Chair of the Audit Committee are senior board positions and accordingly that the
Company meets in spirit the requirement that at least one of the senior board positions is held by a woman.
The Role of the Chair and Senior Independent Director
The Chair is responsible for providing effective leadership
to the Board, by setting the tone of the Company,
demonstrating objective judgement and promoting a
culture of openness and debate. The Chair facilitates the
effective contribution of, and encourages active
engagement by, each Director. In conjunction with the
Company Secretary, the Chair ensures that Directors
receive accurate, timely and clear information to assist
them with effective decision-making. The Chair acts upon
the results of the Board evaluation process by recognising
strengths and addressing any weaknesses and also
ensures that the Board engages with major shareholders
and that all Directors understand shareholder views.
The Senior Independent Director (“SID”) acts as a sounding
board for the Chair and acts as an intermediary for other
directors, when necessary. The SID takes responsibility for
an orderly succession process for the Chair and leads the
annual appraisal of the Chair’s performance. The SID is
also available to shareholders to discuss any concerns
they may have.
Management of Conflicts of Interest, Anti-Bribery Policy and
Tax Evasion Policy
The Board has a procedure in place to deal with a
situation where a Director has a conflict of interest. As part
of this process, the Directors prepare a list of other
positions held and all other conflict situations that may
need to be authorised either in relation to the Director
concerned or his/her connected persons. The Board
considers each Director’s situation and decides whether
to approve any conflict, taking into consideration what is in
the best interests of the Company and whether the
Director’s ability to act in accordance with his/her wider
duties is affected. Each Director is required to notify the
Company Secretaries of any potential, or actual, conflict
situations which will need authorising by the Board.
Authorisations given by the Board are reviewed at each
Board meeting.
The Board takes a zero-tolerance approach to bribery
and has adopted appropriate procedures designed to
prevent bribery. abrdn also takes a zero-tolerance
approach and has its own detailed policy and procedures
in place to prevent bribery and corruption. It is the
Company’s policy to conduct all of its business in an
honest and ethical manner. The Company takes a zero-
tolerance approach to facilitation of tax evasion, whether
under UK law or under the law of any foreign country and
its full policy on tax evasion may be found on its website.
40 Murray Income Trust PLC
Directors’ Insurance and Indemnities
The Company’s Articles of Association indemnify each of
the Directors out of the assets of the Company against
any liabilities incurred by them as a Director of the
Company in defending proceedings, or in connection with
any application to the Court in which relief is granted. In
addition, the Directors have been granted qualifying
indemnity provisions by the Company which are currently
in force. Directors’ and Officers’ liability insurance cover
has been maintained throughout the Year at the expense
of the Company.
Corporate Governance
The Company is committed to high standards of
corporate governance and its Statement of Corporate
Governance is set out on page 46.
Matters Reserved for the Board
The Board sets the Company’s objectives and ensures
that its obligations to its shareholders are met. It has
formally adopted a schedule of matters which are
required to be brought to it for decision, thus ensuring that
it maintains full and effective control over appropriate
strategic, financial, operational and compliance issues.
These matters include:
· the maintenance of clear investment objectives and risk
management policies;
· the monitoring of the business activities of the Company
ranging from analysis of investment performance
through to review of quarterly management accounts;
· monitoring requirements such as approval of the Half-
Yearly Report and Annual Report and financial
statements and approval and recommendation of
any dividends;
· setting the range of gearing in which the Manager
may operate;
· major changes relating to the Company’s structure
including share buy-backs and share issuance;
· Board appointments and removals and the
related terms;
· authorisation of Directors’ conflicts or possible
conflicts of interest;
· terms of reference and membership of Board
Committees;
· appointment and removal of the Manager and the
terms and conditions of the Management Agreement
relating thereto; and
· London Stock Exchange/Financial Conduct Authority -
responsibility for approval of all circulars, listing
particulars and other releases concerning matters
decided by the Board.
Full and timely information is provided to the Board to
enable it to function effectively and to allow the Directors
to discharge their responsibilities.
Consumer Duty
The FCA’s Consumer Duty rules were published in July
2022. The rules comprise a fundamental component of
the FCA’s consumer protection strategy and aim to
improve outcomes for retail customers across the entire
financial services industry through the assessment of
various outcomes, one of which is an assessment of
whether a product provides value. Under the Consumer
Duty, the Manager is the product ‘manufacturer’ of the
Company and therefore the Manager was required to
publish its assessment of value from April 2023. Using a
newly developed assessment methodology, the Manager
assessed the Company as 'expected to provide fair value
for the reasonably foreseeable future'. As this was the first
year of assessment, the Board gained an understanding
of the Manager's basis of assessment and no concerns
were identified with either the assessment method or the
outcome of the assessment. In future years the
Management Engagement Committee will monitor the
assessment method as well as the outcome and is
amending its terms of reference accordingly.
Board Committees
The Board has appointed a number of Committees as set
out below. Copies of their terms of reference, which define
the responsibilities and duties of each Committee, are
available on the Company’s website.
Audit Committee
The Audit Committee Report is on pages 51 to 53.
Management Engagement Committee
· The terms and conditions of the Company’s agreement
with the Manager, set out on pages 37 and 38, are
considered by the Management Engagement
Committee which comprises the whole Board and is
chaired by Neil Rogan. The key responsibilities of the
Management Engagement Committee include:
Directors’ Report
Continued
Murray Income Trust PLC 41
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
· monitoring and evaluating the performance of
the Manager;
· reviewing, at least annually, the continued retention of
the Manager; and
· reviewing, at least annually, the terms of appointment of
the Manager including, but not limited to, the level and
methodology of the management fees as well as the
notice period of the Manager.
In monitoring the performance of the Manager, the
Committee considers the investment record of the
Company over the short and long term, taking into
account its performance against the Benchmark, peer
group investment trusts and open-ended funds, and
against its delivery of the investment objective to
shareholders. The Committee also reviews the
management processes, risk control mechanisms and
promotional activities of the Manager.
At its meeting in May 2023, the Committee undertook a
review covering all of the services provided to the
Company by the Manager including investment
management, risk management and internal controls,
marketing and investor relations, company secretarial
and administration services, and also included
consideration as to the appropriateness of the
management fee arrangements. In light of the outcome
of the review, the Directors consider the continuing
appointment of the Manager, on the current terms (see
pages 37 and 38), to be in the best interests of
shareholders because they believe that the Manager has
the investment management, promotional and
associated secretarial and administrative skills required
for the effective operation of the Company.
Nomination Committee
The Board has established a Nomination Committee,
comprising all of the Directors, with Neil Rogan as Chair.
The Committee is responsible for:
· determining the overall size and composition of the
Board (including the skills, knowledge, experience and
diversity);
· undertaking longer term succession planning, including
setting a policy on tenure for Directors;
· undertaking an annual evaluation of the Directors,
including establishing that each Director possesses the
capacity to commit sufficient time to discharge their
responsibilities;
· oversight of appointments to the Board, including open
advertising or engagement of independent search
consultants, with a view to attracting candidates from a
wide range of backgrounds and with different
experience, with due regard to the benefits of diversity
on the Board;
· assessing, annually, the effectiveness and
independence of each Director; and
· making recommendations for the election or re-
election of any Director, having evaluated their individual
performance, capacity and contribution.
The Committee’s overriding priority in appointing new
Directors is to identify the candidate with the optimal
range of skills and experience to complement the existing
Directors. The Board also recognises the benefits, and is
supportive, of the principle of diversity in its recruitment of
new Directors.
During the Year, through the work of the Nomination
Committee, the Directors undertook a review of the
Board, its Committees and the performance of individual
Directors. The process involved the completion of
questionnaires by each Director with the results discussed
by the Board thereafter, with appropriate action points
agreed. Following the evaluation process, the Board
concluded that it operates effectively to promote the
success of the Company and that each Director makes
a significant contribution to the collective Board. The
review of the Chair was undertaken by the Senior
Independent Director.
The Directors, excluding the Chair and Peter Tait,
undertook an exercise to review the chair of the Company
on the retirement of the current Chair at the forthcoming
AGM. Being a candidate, Peter Tait recused himself from
this discussion, which was led by the Chair of the Audit
Committee. Further to the decision to appoint Peter Tait
to the role, the Committee considered, in the absence of
Alan Giles, the latter’s appointment as Senior Independent
Director, as successor to Peter Tait. Following these
changes, the Committee reviewed the Board succession
plan and, with the aim of restoring the Board to six
members, intends to undertake recruitment of new
Directors in due course.
Re-election of Directors
The Directors attended scheduled meetings, including a
strategy session during the Year, as follows (with their
eligibility to attend the relevant meetings in brackets).
The Board meets more frequently when business
needs require:
42 Murray Income Trust PLC
Board
Meetings
(6)
Audit
Committee
Meetings
(3)
Management
Engagement
Committee
Meetings
(2)
Nomination
Committee
Meetings
(2)
Remuneration
Committee
Meetings
(1)
Neil
Rogan
A
6 - 2 2 1
Stephanie
Eastment
6 3 2 2 1
Peter Tait 6 3 2 2 1
Merryn
Somerset
Webb
6 3 2 2 1
Alan Giles 6 3 2 2 1
Nandita
Sahgal
Tully
6 3 2 2 1
A
Not a member of the Audit Committee but attended all of the meetings at the
invitation of the Committee Chair.
The Board as a whole believes that Neil Rogan, Peter Tait,
Stephanie Eastment, Alan Giles, Merryn Somerset Webb
and Nandita Sahgal Tully each remains independent of
the Manager and free of any relationship which could
materially interfere with the exercise of his or her
independent judgement on issues of strategy,
performance, resources and standards of conduct and
confirms that, following formal performance evaluations,
the individuals’ performance continues to be effective and
demonstrates commitment to the role.
The biographies of each of the Directors seeking re-
election are shown on pages 34 to 36 and include their
experience, length of service and the contribution that
each Director makes to the Board. Each Director
has the requisite high level and range of business and
financial experience which enables the Board to provide
clear and effective leadership and proper stewardship
of the Company.
Neil Rogan is not standing for re-election as a Director and
will retire as a Director at the conclusion of the AGM.
Merryn Somerset Webb has decided to not seek re-
election as a Director and will retire from the Board at the
conclusion of the AGM; this is in order that she is able to
pursue conference hosting opportunities with interactive
investor and other organisations without any risk of
compromising her independence.
Stephanie Eastment, Alan Giles, Peter Tait and Nandita
Sahgal Tully, each being eligible, offer themselves for
re-election as Directors of the Company at the AGM on
7 November 2023.
Policy on Tenure
The Committee has adopted a policy whereby all
Directors will stand for re-election at each AGM. In
addition Directors, including the Chair, will not stand for re-
election as a Director of the Company later than the AGM
following the ninth anniversary of their appointment to the
Board unless in relation to exceptional circumstances.
Led by Peter Tait as Senior Independent Director, the
other Directors, in the absence of Neil Rogan, had
determined in 2022 that it was in the best interests of
shareholders that Neil Rogan continue as Chair in order to
oversee the Company’s centenary in 2023.
Remuneration Committee
The Board has established a Remuneration Committee,
comprising all of the Directors, whose Chair is Peter Tait.
The Directors’ Remuneration Report on pages 47 to 50
sets out the responsibilities of the Committee and the work
undertaken by the Committee during the Year.
Accountability and Audit
The responsibilities of the Directors and the auditor in
connection with the financial statements appear on
pages 54, 60 and 61.
The Directors who held office at the date of this Report
each confirm that, so far as they are aware, there is no
relevant audit information of which the Company’s auditor
is unaware and that they have taken all the steps that they
could reasonably be expected to have taken as a Director
in order to make themselves aware of any relevant audit
information and to establish that the Company’s auditor is
aware of that information. Further, there have been no
important, additional events since the year end which
warrant disclosure. The Directors confirm that no non-
audit services were provided by the auditor during the
Year and, after reviewing the auditor’s procedures in
connection with the provision of any such services, remain
satisfied that the auditor’s objectivity and independence is
being safeguarded.
Going Concern
The Directors have undertaken a rigorous review and
consider both that there are no material uncertainties and
that the adoption of the going concern basis of accounting
is appropriate. This conclusion is consistent with the longer
term Viability Statement on pages 22 and 23.
Directors’ Report
Continued
Murray Income Trust PLC 43
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The Company’s assets consist primarily of a diverse
portfolio of listed equity shares nearly all of which, in most
circumstances, are realisable within a short timescale. The
Board has set limits for borrowing and regularly reviews
the level of any gearing, cash flow projections and
compliance with banking and loan note covenants.
The Directors are mindful of the principal risks and
uncertainties disclosed on pages 18 to 22, and have
reviewed forecasts detailing revenue and liabilities. The
Directors are satisfied that the Company has adequate
resources to continue in operational existence for the
foreseeable future, being at least 12 months from the date
of approval of this Annual Report.
Relations with Shareholders
The Directors place great importance on communication
with shareholders. The Company’s shareholder register is
retail-dominated and the Manager, together with the
Company’s broker, regularly meets with current and
prospective shareholders to discuss performance. The
Board receives investor relations updates from the
Manager on at least a quarterly basis. Any changes in the
shareholder register as well as shareholder feedback is
discussed by the Directors at each Board meeting.
Regular updates are provided to shareholders through the
Annual Report, Half Yearly Report, monthly factsheets and
company announcements, including daily net asset
values, all of which are available through the Company’s
website at: murray-income.co.uk. The Annual Report is also
widely distributed to other parties who have an interest in
the Company’s performance. Shareholders and investors
may obtain up-to-date information on the Company
through its website or via abrdn’s Customer Services
Department (see page 113 for details).
The Board’s policy is to communicate directly with
shareholders and their representative bodies without the
involvement of the management group (either the
Company Secretary or abrdn) in situations where direct
communication is required and representatives from the
Board offer to meet with major shareholders on an annual
basis in order to gauge their views. The Company
Secretary acts on behalf of the Board, not the Manager,
and there is no filtering of communication. At each Board
meeting the Board receives full details of any
communication from shareholders to which the Chair
responds, as appropriate, on behalf of the Board.
In addition, in relation to institutional shareholders,
members of the Board may be either accompanied by
the Manager or conduct meetings in the absence of
the Manager.
The Company’s Annual General Meeting ordinarily
provides a forum, both formal and informal, for
shareholders to meet and discuss issues with the Directors
and Investment Manager. The Notice of AGM included
within the Annual Report is normally sent out at least 20
working days in advance of the meeting.
The Company will also hold an online presentation for
existing and potential shareholders on 3 November 2023.
Further information on how to register may be found in the
Chair’s Statement on page 7.
Relations with Suppliers, Customers
and Others
The Directors have regard to the need to foster the
Company’s business relationships with suppliers,
customers and others, and the effect of that regard,
including on the principal decisions taken by the Company
during the financial year; further information on the
Company’s responsibilities under Section 172 of
Companies Act 2006 may be found on pages 24 and 25.
Independent Auditor
Shareholders approved the re-appointment of
PricewaterhouseCoopers LLP as the Company’s auditor
at the AGM on 1 November 2022 and resolutions to
approve its re-appointment for the year to 30 June 2024,
and to authorise the Audit Committee to determine its
remuneration, will be proposed at the forthcoming AGM.
Substantial Interests
As at 30 June 2023 and 31 August 2023 the following
interests over 3% in the issued Ordinary share capital of
the Company (excluding treasury shares) had been
disclosed in accordance with the requirements of the
FCA’s Guidance and Transparency Disclosure Rules:
30 June 2023 31 August 2023
Shareholder Number of
shares held
%
held
Number of
shares held
%
held
Interactive Investor
(execution only)
16,674,055 14.9 16,565,575 15.0
Hargreaves Lansdown
(execution only)
15,057,918 13.5 15,195,318 13.8
abrdn retail plans 12,644,557 11.3 11,888,778 10.8
Rathbones 11,956,024 10.7 11,842,207 10.7
A J Bell
(execution only)
4,042,047 3.6 4,044,782 3.7
Charles Stanley 3,500,629 3.1 3,312,094 3.0
The above interests, as at 31 August 2023, were
unchanged as at the date of approval of this Report.
44 Murray Income Trust PLC
Future Developments of the Company
Disclosures relating to the future developments of the
Company may be found in the Chair’s Statement on
page 8.
Disclosures Required by FCA Listing
Rule 9.8.4
This rule requires listed companies to report certain
information in a single identifiable section of their annual
financial reports. None of the prescribed information is
applicable to the Company in the Year.
Financial Instruments
The financial risk management objectives and policies
arising from financial instruments and the exposure of
the Company to risk are disclosed in note 18 to the
financial statements.
Annual General Meeting (“AGM”)
Among the special business being put at the AGM of the
Company to be held on 7 November 2023, the following
resolutions will be proposed:
Authority to allot shares and disapply pre-emption rights
(Resolutions 11 and 12)
Ordinary resolution 11 will renew the authority to allot the
unissued share capital up to an aggregate nominal
amount of £1.4m (equivalent to approximately 5.5m
Ordinary shares, or, if less, 5% of the Company’s existing
issued share capital (excluding treasury shares) on the
date of passing of this resolution). Such authority will
expire on the date of the AGM in 2024 or on 31 December
2024, whichever is earlier. This means that the authority
will require to be renewed at the next AGM.
When shares are to be allotted for cash, Section 561 of the
Companies Act 2006 (the “Act”) provides that existing
shareholders have pre-emption rights and that the new
shares to be issued, or sold from treasury, must be offered
first to such shareholders in proportion to their existing
holding of shares. However, shareholders can, by special
resolution, authorise the Directors to allot shares or sell
from treasury otherwise than by a pro rata issue to
existing shareholders. Special resolution 12 will, if passed,
give the Directors power to allot for cash or sell from
treasury equity securities up to an aggregate nominal
amount of £2.8m (equivalent to approximately 11.0m
Ordinary shares, or, if less, 10% of the Company’s existing
issued share capital (excluding treasury shares) on the
date of passing of this resolution, as if Section 561 of the
Act does not apply). This authority will also expire on the
date of the AGM in 2024 or on 31 December 2024,
whichever is earlier. This authority will not be used in
connection with a rights issue by the Company.
The Directors intend to use the authorities given by
resolutions 11 and 12 to allot shares or sell shares from
treasury and disapply pre-emption rights only in
circumstances where this will be clearly beneficial to
shareholders as a whole. The issue proceeds would be
available for investment in line with the Company’s
investment policy. No issue of shares will be made which
would effectively alter the control of the Company without
the prior approval of shareholders in general meeting. It is
the intention of the Board that any issue of shares or any
re-sale of treasury shares would only take place at a price
not less than 0.5% above the NAV per share prevailing at
the date of sale. It is also the intention of the Board that
sales from treasury would only take place when the Board
believes that to do so would assist in the provision of
liquidity to the market.
Purchase of the Company’s own Ordinary shares
(Resolution 13)
At the AGM held on 1 November 2022, shareholders
approved the renewal of the authority permitting the
Company to repurchase its Ordinary shares. The Directors
wish to renew the authority given by shareholders at the
previous AGM. A share buy-back facility enhances
shareholder value by acquiring shares at a discount to
NAV as and when the Directors consider this to be
appropriate. The purchase of shares, when they are
trading at a discount to NAV per share, should result in an
increase in the NAV per share for the remaining
shareholders. This authority, if conferred, will only be
exercised if to do so would result in an increase in the NAV
per share for the remaining shareholders and if it is in the
best interests of shareholders generally. Any purchase of
shares will be made within guidelines established from
time to time by the Board. It is proposed to seek
shareholder authority to renew this facility for another
year at the AGM.
Directors’ Report
Continued
Murray Income Trust PLC 45
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Under the FCA’s Listing Rules, the maximum price that
may be paid on the exercise of this authority must not
exceed the higher of (i) 105% of the average of the middle
market quotations for the shares over the five business
days immediately preceding the date of purchase and (ii)
the higher of the last independent trade and the highest
current independent bid on the trading venue where the
purchase is carried out. The minimum price which may be
paid is 25p per share. Shares which are purchased under
this authority will either be cancelled or held as treasury
shares. Special resolution 13 will renew the authority to
purchase in the market a maximum of 14.99% of shares in
issue at the date of passing of the resolution (amounting to
approximately 16.5m Ordinary shares). Such authority will
expire on the date of the AGM in 2024, or on 31 December
2024, whichever is earlier. This means in effect that the
authority will have to be renewed at the next AGM, or
earlier, if the authority has been exhausted. No dividends
may be paid on any shares held in treasury and no voting
rights will attach to such shares. The benefit of the ability to
hold treasury shares is that such shares may be sold at
short notice. This should give the Company greater
flexibility in managing its share capital, and improve
liquidity in its shares.
Recommendation
The Directors believe that the resolutions to be proposed
at the AGM are in the best interests of the Company and
its shareholders as a whole, and recommend that
shareholders vote in favour of the resolutions, as the
Directors intend to do in respect of their own beneficial
shareholdings, amounting to 65,228 Ordinary shares,
representing 0.04% of the Company’s issued share capital
(excluding treasury shares) at 30 June 2023.
On behalf of the Board
Neil Rogan
Chair
19 September 2023
46 Murray Income Trust PLC
Murray Income Trust PLC (the “Company”) is committed
to high standards of corporate governance. The Board is
accountable to the Company’s shareholders for good
governance and this statement describes how the
Company has applied the principles identified in the UK
Corporate Governance Code as published in July 2018
(the “UK Code”), which is available on the Financial
Reporting Council’s (the “FRC”) website: frc.org.uk, and is
applicable for the Company’s Year.
The Board has also considered the principles and
provisions of the AIC Code of Corporate Governance as
published in February 2019 (the “AIC Code”). The AIC
Code addresses the principles and provisions set out in the
UK Code, as well as setting out additional provisions on
issues that are of specific relevance to the Company. The
AIC Code is available on the AIC’s website: theaic.co.uk.
The Board considers that reporting against the principles
and provisions of the AIC Code, which has been endorsed
by the FRC, provides more relevant information to
shareholders.
The Board confirms that, during the Year, the Company
has complied with the principles and provisions of the AIC
Code and the relevant provisions of the UK Code, except
for those provisions relating to:
· the role and responsibility of the chief executive;
· executive directors’ remuneration; and
· the requirement for an internal audit function.
The Board considers that these provisions are not relevant
to the position of the Company being an externally
managed investment company. In particular, all of the
Company’s day-to-day management and administrative
functions are outsourced to third parties. As a result, the
Company has no executive directors, employees or
internal operations. The Company has therefore not
reported further in respect of these provisions.
Information on how the Company has applied the AIC
Code, the UK Code, the Companies Act 2006 and the
FCA’s DTR 7.2.6 can be found in the Annual Report
as follows:
· the composition and operation of the Board and its
Committees are detailed on pages 38 to 42, and on
pages 51 to 53 in respect of the Audit Committee;
· the Board’s policy on diversity is on page 38 while
information on Board diversity is on pages 38 and 39;
· the Company’s approach to internal control and risk
management is detailed on pages 51 and 52;
· the contractual arrangements with the Manager are set
out on page 37 while details of the annual assessment of
the Manager may be found on page37 and 38;
· the Company’s capital structure and voting rights are
summarised on page 37;
· the substantial interests disclosed in the Company’s
shares are listed on page 44;
· the rules concerning the appointment and replacement
of Directors are contained in the Company’s Articles of
Association and are summarised on page 47. There are
no agreements between the Company and its Directors
concerning compensation for loss of office; and
· the powers to issue or buy back the Company’s ordinary
shares, which are sought annually, and any
amendments to the Company’s Articles of Association
require a special resolution (75% majority) to be passed
by shareholders and information on these resolutions
may be found on pages 44 and 45.
By order of the Board
abrdn Holdings Limited, Secretaries
1 George Street
Edinburgh
EH2 2LL
19 September 2023
Statement of Corporate Governance
Murray Income Trust PLC 47
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The Remuneration Committee, established by the Board,
has prepared this Directors’ Remuneration Report which
consists of three parts:
a) a Remuneration Policy, which is subject to a binding
shareholder vote every three years - most recently
voted on at the AGM on 27 November 2020 where the
proxy votes on the relevant resolution were: For -
38,821,360 votes (99.36%); Discretionary - 40,287
votes (0.10%); Against - 210,997 votes (0.54%); and
Withheld - 155,239 votes. The Remuneration Policy
will be put to a shareholder vote, as resolution 3, at the
AGM on 7 November 2023;
b) an annual Implementation Report, which is subject to
an advisory vote; and
c) an Annual Statement.
The law requires the Company’s auditor to audit certain of
the disclosures provided in this report. Where disclosures
have been audited, they are indicated as such. The
independent auditor’s opinion is included on pages
55 to 62.
There have been no changes to the Remuneration Policy
(the “Policy”) during the Year. This has been determined
after reviewing the impact of the previous Policy, taking
account of discussions with shareholders, and noting that
each year’s Directors’ Remuneration Report describes
how the Policy has been implemented over the Year and
how it will be implemented in the following Year. As stated
above, the Policy will be put to shareholder vote at the
forthcoming AGM. The Policy to be voted on is shown
below. There have been several minor changes to the
layout and wording within the Policy but these are not
material and the principles remain the same as for
previous years.
Remuneration Policy
This part of the Report provides details of the Company’s
Policy for Directors of the Company, which takes into
consideration corporate governance principles. The
Board considers, where raised, shareholders’ views on
Directors’ remuneration.
Fees for Directors are determined by the Board within the
limit stated in the Company's Articles of Association (the
"Articles"). The Articles limit aggregate fees to £250,000
per annum. The limit can be amended by shareholder
resolution and was last increased at the AGM in 2017.
The remuneration of Directors should be reviewed
annually, although such review may not necessarily result
in any change. The annual review should ensure
remuneration supports the strategic objectives of the
Company, reflects Directors’ duties and responsibilities,
expected time commitment, the level of skills and
experience required, and the need for Directors to
maintain on an ongoing basis an appropriate level of
knowledge of regulatory and compliance requirements in
an industry environment of increasing complexity.
Remuneration should be fair and comparable to that of
similar investment trusts.
The Policy will apply to any new Directors who will be paid
the appropriate fee based on the Directors’ fees level in
place at the date of appointment.
· The Company has no employees and consequently has
no policy on the remuneration of employees.
· All the Directors are non-executive appointed under the
terms of letters of appointment.
· Directors do not have service contracts.
· No incentive or introductory fees will be paid to
encourage a directorship.
· Directors’ remuneration is not subject to any
performance-related fee.
· Directors are not eligible for bonuses, pension benefits,
share options, long term incentive schemes or other
benefits.
· Directors are not entitled to exit payments or any
compensation for loss of office.
· Directors are entitled to be reimbursed for any
reasonable expenses properly incurred in the
performance of their duties.
· Directors can be paid additional discretionary payments
for services which , in the opinion of the Directors, are
outside of the scope of the ordinary duties of a Director.
· The terms of appointment provide that a Director may
be removed subject to three months’ written notice.
· Directors must retire and be subject to re-election at the
first AGM after their appointment; the Company has
also determined that every Director will stand for re-
election at each AGM.
· No Director will stand for re-election as a Director of the
Company later than the AGM following the ninth
anniversary of their appointment to the Board unless in
relation to exceptional circumstances.
Directors’ Remuneration Report
48 Murray Income Trust PLC
· The Company indemnifies its Directors for all costs,
charges, losses together with certain expenses and
liabilities which may be incurred in the discharge of
duties, as a Director of the Company.
Directors’ & Officers’ liability insurance cover is maintained
by the Company on behalf of the Directors.
Implementation Report
Directors’ Fees
The level of fees for the Year and the preceding year are
set out in the table below. There are no further fees to
disclose as the Company has no employees, Chief
Executive or Executive Directors.
30 June 2023
£
30 June 2022
£
Chair 41,200 40,200
Audit Committee Chair 34,300 33,500
Senior Independent Director 30,200 29,500
Director 27,500 26,800
Directors’ fees were last revised on 1 July 2022. The Board
carried out a review of Directors’ annual fees during the
Year by reference to inflation, measured by the increase in
the Consumer Prices Index since 1 July 2022, and taking
account of peer group comparisons by sector and by
market capitalisation. Following this review, it was decided
that the Directors’ base fee of £27,500 would be increased
by approximately 4.5%, with similar increases for other
positions. With effect from 1 July 2023, Directors’ fees are
£43,125 for the Chair, £35,950 for the Audit Committee
Chair, £31,625 for the Senior Independent Director and
£28,750 for the other Directors.
These increased fees are considered to reflect
increases in inflation and to be commensurate with the
time commitment required of Directors of the Company
to adequately discharge their responsibilities, taking into
account increasingly complex and onerous
regulatory requirements.
Company Performance
The graph shows the share price total return (assuming all
dividends are reinvested) to Ordinary shareholders
compared to the total return from the FTSE All-Share
Index for the ten year period ended 30 June 2023
(rebased to 100 at 30 June 2013). This index was chosen
for comparison purposes, as it is the benchmark used for
investment performance measurement purposes.
100
110
120
130
140
150
160
170
180
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Share Price FTSE All-Share
Statement of Proxy Voting at Annual General Meeting
At the Company’s latest AGM, held on 1 November 2022,
shareholders approved the Directors’ Remuneration
Report (other than the Directors’ Remuneration Policy) in
respect of the year ended 30 June 2022 and the following
proxy votes received on the relevant resolution were:
For – 40,256,956 (99.1%); Discretionary – 35,239 votes
(0.1%); Against – 338,104 votes (0.8%); and Withheld –
145,173 votes.
Directors’ Remuneration Report
Continued
Murray Income Trust PLC 49
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Audited Information
Directors’ Remuneration
The Directors received the following remuneration in the form of fees and taxable expenses:
Year ended 30 June 2023 Year ended 30 June 2022
Fees
£
Taxable
Expenses
£
Total
£
Fees
£
Taxable
Expenses
£
Total
£
Neil Rogan 41,200 502 41,702 40,200 1,245 41,445
Stephanie Eastment 34,300 188 34,488 33,500 452 33,952
Peter Tait (appointed SID on 2 November 2021) 30,200 907 31,107 28,592 763 29,355
Merryn Somerset Webb 27,500 1,312 28,812 26,800 463 27,263
Alan Giles
(appointed on 17 November 2020) 27,500 91 27,591 26,800 576 27,376
Nandita Sahgal Tully (appointed on 3 November 2021) 27,500 204 27,704 17,718 - 17,718
Jean Park (retired on 2 November 2021) n/a n/a n/a 9,997 128 10,125
Donald Cameron (retired on 2 November 2021) n/a n/a n/a 9,082 484 9,566
Total 188,200 3,204 191,404 192,689 4,111 196,800
The above amounts exclude any employers’ national insurance contributions, if applicable. All fees are at a fixed
rate and there is no variable remuneration. Fees are pro-rated where a change takes place during a financial year.
No payments were made to third parties. There are no other fees to disclose as the Company has no employees,
chief executive or executive directors. Taxable expenses refer to amounts claimed by Directors for travelling to
attend meetings.
Annual Percentage Change in Directors’ Remuneration
The table below sets out, for the Directors who served during the Year, the annual percentage change in Directors’ fees
for the past four years.
Year ended 30
June 2023
Year ended 30
June 2022
Year ended 30
June 2021
Year ended 30
June 2020
Fees
%
Fees
%
Fees
%
Fees
%
Neil Rogan 2.5 7.2 0.0 0.0
Stephanie Eastment 2.4 11.7 0.0 14.3
Peter Tait (appointed SID on 2 November 2021) 5.6 12.1 0.0 0.0
Merryn Somerset Webb (appointed on 7 August 2019) 2.6 5.1 11.0
B
See note
A
Alan Giles (appointed on 17 November 2020) 2.6 68.9
B
See note
A
n/a
Nandita Sahgal Tully (appointed on 3 November 2021) 55.2
B
See note
A
n/a n/a
A
Percentage change figure cannot be calculated in the year of appointment.
B
If the Director had been appointed for the whole of the previous year, the annual change figure would have been nil for Merryn Somerset Webb,
5.1% for Alan Giles and 2.6% for Nandita Sahgal Tully.
50 Murray Income Trust PLC
Spend on Pay
As the Company has no employees, the Directors do not
consider it appropriate to present a table comparing
remuneration paid to Directors with distributions to
shareholders. However, for ease of reference, the total
fees paid to Directors are shown in the table on page 49
while dividends paid to shareholders are set out in note 7
and share buybacks are detailed in note 15.
Directors’ Interests in the Company
The Directors are not required to have a shareholding in
the Company. The Directors (including their persons
closely associated) at 30 June 2023, and 30 June 2022,
had no interest in the share capital of the Company other
than those interests shown below, all of which are
beneficial interests, unless indicated otherwise:
30 June 2023 30 June 2022
Director Ord 25p Ord 25p
Neil Rogan 44,719 37,157
Stephanie Eastment 4,500
A
4,500
A
Peter Tait 7,000 5,000
Merryn Somerset Webb 3,449 3,449
Alan Giles 5,000 5,000
Nandita Sahgal Tully 560 560
Jean Park n/a 5,575
B
Donald Cameron n/a 1,691
B
A
Of which 1,700 shares were held non-beneficially
B
As at date of resignation on 2 November 2021
There have been no changes to the Directors’ interests in
the share capital of the Company since the year end up to
the date of approval of this Report.
Annual Statement
On behalf of the Board and in accordance with Part 2 of
Schedule 8 of the Large and Medium-sized Companies
and Groups (Accounts and Reports) (Amendment)
Regulations 2013, I confirm that the above Report on
Remuneration Policy and Remuneration Implementation
summarises, as applicable, for the Year:
· the major decisions on Directors’ remuneration;
· any substantial changes relating to Directors’
remuneration made during the Year; and
· the context in which the changes occurred and in which
decisions have been taken.
On behalf of the Board
Peter Tait
Chair of the Remuneration Committee
19 September 2023
Directors’ Remuneration Report
Continued
Murray Income Trust PLC 51
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Stephanie Eastment is Chair of the audit committee,
membership of which comprises all of the Directors of the
Company with the exception of Neil Rogan. In compliance
with the July 2018 UK Code on Corporate Governance
(the “Code”), the Chair of the Board is not a member of the
committee but attends the committee by invitation of
the committee Chair.
The Directors have satisfied themselves that at least two
of the committee’s members have recent and relevant
financial experience – Stephanie Eastment and Nandita
Sahgal Tully are both Fellows of the Institute of Chartered
Accountants in England & Wales – and that, collectively,
the committee possesses competence relevant to
investment trusts.
The committee meets at least twice each year, in line with
the cycle of annual and half-yearly reports, which is
considered by the Directors to be a frequency
appropriate to the size and complexity of the Company.
Role of the Audit Committee
In summary, the committee’s main audit review
functions are:
· to review and monitor the internal control systems and
risk management systems (including review of non-
financial risks) on which the Company is reliant (see
“Internal Controls and Risk Management”, below);
· to consider annually whether there is a need for the
Company to have its own internal audit function;
· to monitor the integrity of the half-yearly and annual
financial statements of the Company by reviewing, and
challenging where necessary, the actions and
judgements of the Manager;
· to review, and report to the Board on, the significant
financial reporting issues and judgements made in
connection with the preparation of the Company’s
financial statements, half-yearly reports,
announcements and related formal statements;
· to review the content of the Annual Report and financial
statements and advise the Board on whether, taken as a
whole, it is fair, balanced and understandable and
provides the information necessary for shareholders to
assess the Company’s position and performance,
business model and strategy;
· to meet with the external auditor to review their
proposed audit programme of work and the findings
as auditor;
· to develop and implement a policy on the engagement
of the auditor to supply non-audit services;
· to review a statement from the Manager detailing the
arrangements in place for the Manager’s staff, in
confidence, to escalate concerns about possible
improprieties in matters of financial reporting or other
matters (“whistleblowing”);
· to oversee and manage audit tenders and selection
processes, to make recommendations to the Board in
relation to the appointment of the auditor and removal
of the auditor and to approve the remuneration and
terms of engagement of the auditor;
· to monitor and review annually the auditor’s
independence, objectivity, effectiveness, resources
and qualification; and
· to investigate the reasons giving rise to any resignation
of the auditor and consider whether any action
is required.
The committee fulfilled all the above required roles and
responsibilities during the Year.
Internal Controls and Risk Management
Through the committee, the Board is ultimately
responsible for the Company’s system of internal control
and risk management and for reviewing its effectiveness.
The committee confirms that there is a robust process for
identifying, evaluating and managing the Company’s
significant business and operational risks, that it has been
in place for the Year and up to the date of approval of the
Annual Report and Financial Statements, and that it is
regularly reviewed by the Board and accords with the risk
management and internal control guidance for directors
in the Code.
The design, implementation and maintenance of controls
and procedures to safeguard the assets of the Company
and to manage its affairs extends to operational and
compliance controls and risk management.
The Directors have delegated the investment
management of the Company’s assets to the Manager
within overall guidelines and this embraces
implementation of the system of internal control, including
financial, operational and compliance controls and risk
management. Internal control systems are monitored and
supported by the Manager’s Internal Audit department
which undertakes periodic examination of business
processes and ensures that recommendations to improve
controls are implemented.
Audit Committee Report
52 Murray Income Trust PLC
Risks are identified and documented through a risk
management framework by each function within the
Manager’s activities. Risk is considered in the context of the
FRC and AIC Code guidance, and includes financial,
regulatory, market, operational and reputational risks. This
helps the internal audit risk assessment model identify
those functions for review. Any weaknesses identified are
reported to the Board, and timetables are agreed for
implementing improvements to systems. The
implementation of any remedial action required is
monitored and feedback provided to the Board.
The principal risks and uncertainties facing the Company
are identified on pages 18 to 22 of this Report.
The key components designed to provide effective
internal control are outlined below:
· the Manager prepares forecasts and management
accounts which allow the Board to assess the
Company’s activities and review its performance; the
emphasis is on obtaining the relevant degree of
assurance and not merely reporting by exception;
· the Board and Manager have agreed clearly-defined
investment criteria, specified levels of authority and
exposure limits. Reports on these, including
performance statistics and investment valuations, are
regularly submitted to the Board and there are
meetings with the Manager as appropriate;
· as a matter of course, the Manager’s compliance
department continually reviews the Manager’s
operations;
· written agreements are in place which specifically
define the roles and responsibilities of the Manager and
other third-party service providers and the committee
reviews, where relevant, ISAE3402 Reports, a global
assurance standard for reporting on internal controls for
service organisations; in particular, the Board receives
equivalent assurance from Link Group, the Company’s
Registrar; and
· at its September 2023 meeting, the committee carried
out its annual assessment of internal controls for the Year
including the internal audit and compliance functions, and
taking account of events since 30 June 2023.
In addition, the Manager ensures that clearly documented
contractual arrangements exist in respect of any activities
that have been delegated to external professional
organisations. A senior member of the Manager’s Internal
Audit department reports six-monthly to the committee
and has direct access to the Directors at any time.
Internal control systems are designed to meet the
Company’s particular needs and the risks to which it is
exposed. Accordingly, the internal control systems are
designed to manage, rather than eliminate, the risk of
failure to achieve business objectives and, by their nature,
can only provide reasonable, and not absolute, assurance
against misstatement and loss.
Significant Risks for the Audit Committee
During its review of the Company’s financial statements
for the Year, the committee considered the following
significant risks including, in particular, those
communicated by the auditor as key areas of audit
emphasis during their planning and reporting of the year
end audit:
Valuation and Existence of Investments
How the risk was addressed
The valuation of investments is undertaken in accordance
with the accounting policies, disclosed in note 2(e) to the
financial statements. All investments are considered liquid
and quoted in active markets and have been categorised
as Level 1 within the FRS 102 fair value hierarchy and can
be verified against daily market prices. The portfolio is
reviewed and verified by the Manager on a regular basis
and management accounts, including a full portfolio
listing, are prepared each month and circulated to the
Board. The portfolio is also reviewed annually by the
auditor. The Company used the services of an
independent depositary (BNP Paribas Trust Corporation
UK Limited) during the Year through whom the assets of
the Company were held. The depositary confirmed that
the accounting records correctly reflected all investee
holdings and that these agreed to custodian records.
Income Recognition
How the risk was addressed
The recognition of investment income is undertaken in
accordance with accounting policy note 2(b) to the
financial statements. Special dividends are allocated to
the capital or revenue accounts according to the nature
of the payment and the intention of the underlying
company. The Directors also review, at each meeting, the
Company’s income, including income received, revenue
forecasts and dividend comparisons.
Internal Auditor
The Board has considered the need for an internal audit
function but, because the Company is externally-
managed, the Board has decided to place reliance on the
Manager’s risk management/internal controls systems
and internal audit procedures.
Audit Committee Report
Continued
Murray Income Trust PLC 53
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
External Auditor
Review of the Auditor
The committee has reviewed the effectiveness of the
auditor including:
· independence - the auditor discusses with the
committee, at least annually, the steps it takes to ensure
its independence and objectivity, including the level of
non-audit fees it has received from the Company, and
makes the committee aware of any potential issues,
explaining all relevant safeguards;
· quality of audit work including the ability to resolve issues
in a timely manner - identified issues are satisfactorily
and promptly resolved;
· its communications/presentation of outputs - the
explanation of the audit plan, any deviations from it and
the subsequent audit findings are comprehensive and
comprehensible, and working relationship with
management - the auditor has a constructive working
relationship with the Manager; and
· quality of people and service including continuity and
succession plans - the audit team is made up of
sufficient, suitably experienced staff with provision
made for knowledge of the investment trust sector and
retention of that knowledge on rotation of the partner.
For the Year, the committee was satisfied with the
auditor’s effectiveness, independence and the objectivity
of the audit process.
Re-appointment of the Auditor
This year’s audit of the Company’s Annual Report is the
fourth performed by PricewaterhouseCoopers LLP since
their appointment following an audit tender process held
by the Company in 2019.
Shareholders will have the opportunity to vote on the re-
appointment of PricewaterhouseCoopers LLP as auditor
and to authorise the committee to approve the auditor’s
remuneration, as Ordinary Resolutions 9 and 10, at the
AGM on 7 November 2023.
Provision of Non-Audit Services
The committee has put in place a policy on the supply of
non-audit services provided by the auditor. Such services
are considered on a case-by-case basis and may only be
provided if the service is at a reasonable and competitive
cost and does not constitute a conflict of interest or
potential conflict of interest or prevent the auditor from
remaining objective and independent. All non-audit
services require the pre-approval of the committee. No
non-audit fees were paid to the auditor during the Year
(2022 - nil). The committee confirms that it has complied
with Part 5.1 of the Competitions and Market Authority’s
Order 2014.
Stephanie Eastment,
Chair of the Audit Committee
19 September 2023
54 Murray Income Trust PLC
The Directors are responsible for preparing the Annual
Report and the financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the
Directors have elected to prepare the financial
statements in accordance with United Kingdom Generally
Accepted Accounting Practice (United Kingdom
Accounting Standards and applicable law) including FRS
102 ‘The Financial Reporting Standard applicable in the UK
and Republic of Ireland’. Under company law the Directors
must not approve the financial statements unless they are
satisfied that they give a true and fair view of the state of
affairs of the Company and of the profit or loss of the
Company for that period.
In preparing these financial statements, the Directors are
required to:
· select suitable accounting policies and then apply
them consistently;
· make judgments and accounting estimates that are
reasonable and prudent;
· state whether applicable UK Accounting Standards
have been followed, subject to any material departures
disclosed and explained in the financial statements; and
· adopt a going concern basis of accounting for the
financial statements unless it is inappropriate to assume
that the Company will continue in business.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Company’s transactions and disclose with reasonable
accuracy at any time the financial position of the
Company and enable them to ensure that the financial
statements comply with the Companies Act 2006. They
are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
Under applicable law and regulations, the Directors are
also responsible for preparing a Directors’ Report,
Directors’ Remuneration Report, Strategic Report and
Statement of Corporate Governance that comply with
that law and those regulations.
The financial statements are published on murray-
income.co.uk which is a website maintained by the
Company’s Manager. The work carried out by the auditor
does not involve consideration of the maintenance and
integrity of the website and, accordingly, the auditor
accepts no responsibility for any changes that have
occurred to the financial statements since being initially
presented on the website. Legislation in the UK governing
the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
Each of the Directors confirms to the best of his or her
knowledge that:
· the financial statements, prepared in accordance with
the applicable accounting standards, give a true and fair
view of the assets, liabilities, financial position and profit
of the Company;
· the Annual Report includes a fair review of the
development and performance of the business and
the position of the Company, together with a description
of the principal risks and uncertainties that the
Company faces;
· in the opinion of the Board, the Annual Report and
financial statements taken as a whole, is fair, balanced
and understandable and provides the information
necessary for shareholders to assess the Company’s
position and performance, business model and strategy;
and
· the financial statements are prepared on an ongoing
concern basis.
For and on behalf of the Board of Murray Income Trust PLC
Neil Rogan
Chair
19 September 2023
Statement of Directors’ Responsibilities
Murray Income Trust PLC 55
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Report on the audit of the financial statements
Opinion
In our opinion, Murray Income Trust PLC’s financial statements:
· give a true and fair view of the state of the Company’s affairs as at 30 June 2023 and of its net return and cash flows for
the year then ended;
· have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United
Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic
of Ireland”, and applicable law); and
· have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements, included within the Annual Report, which comprise: the Statement of Financial
Position as at 30 June 2023; the Statement of Comprehensive Income, Statement of Changes in Equity and Statement of
Cash Flows for the year then ended; and the Notes to the Financial Statements, which include a description of the
significant accounting policies.
Our opinion is consistent with our reporting to the Audit Committee.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law.
Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial
statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independence
We remained independent of the Company in accordance with the ethical requirements that are relevant to our audit
of the financial statements in the UK, which includes the FRC’s Ethical Standard, as applicable to listed public interest
entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
To the best of our knowledge and belief, we declare that non-audit services prohibited by the FRC’s Ethical Standard
were not provided.
We have provided no non-audit services to the Company in the period under audit.
Our audit approach
Context
The Company is a standalone Investment Trust Company and engages abrdn Fund Managers Limited (the “AIFM”) to
manage its assets.
Overview
Audit Scope
· We conducted our audit of the financial statements using information from the AIFM to whom the Directors have
delegated the provision of all administrative functions.
· We tailored the scope of our audit taking into account the types of investments within the Company, the involvement
of the AIFM referred to above, the accounting processes and controls, and the industry in which the Company
operates.
· We obtained an understanding of the control environment in place at the AIFM and adopted a fully substantive testing
approach using reports obtained from the AIFM.
Independent Auditors’ Report to the Members
of Murray Income Trust PLC
56 Murray Income Trust PLC
Key audit matters
· Income from investments.
· Valuation and existence of listed investments.
Materiality
· Overall materiality: £9,990,000 (2022: £10,092,000) based on approximately 1% of Net assets.
· Performance materiality: £7,492,500 (2022: £7,569,000).
The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the
financial statements.
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the audit
of the financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) identified by the auditors, including those which had the greatest effect on: the overall
audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters,
and any comments we make on the results of our procedures thereon, were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
This is not a complete list of all risks identified by our audit.
The key audit matters below are consistent with last year.
Key audit matter How our audit addressed the key audit matter
Income from investments
Refer to page 52 (Audit Committee’s Report), page 68
(Accounting Policies) and page 71 (Notes to the Financial
Statements).
Income from investments comprised dividend income. Within
income from investments there is a risk of incomplete or
inaccurate recognition of income through the failure to
recognise proper income entitlements or to apply an
inappropriate accounting treatment.
In addition, the Directors are required to exercise judgement in
determining whether income in the form of special dividends
should be classified as ‘revenue’ or ‘capital’ in the Statement of
Comprehensive Income.
As such, we focused on the accuracy, completeness and
occurrence of income from investments recognition and its
presentation in the Statement of Comprehensive Income as
set out in the requirements of The Association of Investment
Companies’ Statement of Recommended Practice (the “AIC
SORP”).
We assessed the accounting policy for income recognition for
compliance with accounting standards and the AIC SORP and
performed testing to confirm that income had been accounted for
in accordance with this stated accounting policy. We found that the
accounting policies implemented were in accordance with
accounting standards and the AIC SORP, and that income has been
accounted for in accordance with the stated accounting policy.
We understood and assessed the design and implementation of
key controls surrounding income recognition.
We tested the accuracy of all dividend receipts by agreeing the
dividend rates from investments to independent market data.
We tested occurrence by testing that all dividends recorded in the
year had been declared in the market by investment holdings, and
we traced a sample of dividends received to bank statements.
We tested the allocation and presentation of dividend income
between the revenue and capital return columns of the Statement
of Comprehensive Income in line with the requirements set out in
the AIC SORP by determining the reasons behind dividend
distributions.
Independent Auditors’ Report to the Members
of Murray Income Trust PLC
Continued
Murray Income Trust PLC 57
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Key audit matter How our audit addressed the key audit matter
Based on the audit procedures performed and evidence
obtained, we concluded that income from investments was not
materially misstated.
Valuation and existence of listed investments
Refer to page 52 (Audit Committee’s Report), page 69
(Accounting Policies) and pages 76 and 77 (Notes to the
Financial Statements).
The investment portfolio at 30 June 2023 comprised listed
equity investments of £1,098 million. We focused on the
valuation and existence of investments because investments
represent the principal element of the net asset value as
disclosed in the Statement of Financial Position in the
financial statements.
We tested the valuation of all the listed investments by agreeing
the prices used in the valuation to independent third party sources.
We tested the existence of listed investments by agreeing the
holdings to an independent confirmation from the Depositary, BNP
Paribas Trust Corporation UK Limited, as at 30 June 2023.
No material misstatements were identified from this testing.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the
financial statements as a whole, taking into account the structure of the Company, the accounting processes and
controls, and the industry in which it operates.
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the
financial statements.
The impact of climate risk on our audit
In planning our audit, we made enquiries of the Directors to understand the extent of the potential impact of climate
change risk on the Company’s financial statements. The Directors concluded that the impact on the measurement and
disclosures within the financial statements is not material because the Company's investment portfolio is made up of level 1
quoted securities which are valued at fair value based on market prices. We found this to be consistent with our
understanding of the Company's investment activities. We also considered the consistency of the climate change
disclosures included in the Principal Risks and Uncertainties with the financial statements and our knowledge from our audit.
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the
nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and in
evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:
Overall Company materiality £9,990,000 (2022: £10,092,000).
How we determined it Approximately 1% of Net assets.
Rationale for benchmark applied We believe that net assets is the primary measure used by the
shareholders in assessing the performance of the entity, and is a
generally accepted auditing benchmark. This benchmark provides an
appropriate and consistent year on year basis for our audit.
58 Murray Income Trust PLC
We use performance materiality to reduce to an appropriately low level the probability that the aggregate of
uncorrected and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in
determining the scope of our audit and the nature and extent of our testing of account balances, classes of transactions
and disclosures, for example in determining sample sizes. Our performance materiality was 75% (2022: 75%) of overall
materiality, amounting to £7,492,500 (2022: £7,569,000 for the Company’s financial statements.
In determining the performance materiality, we considered a number of factors - the history of misstatements, risk
assessment and aggregation risk and the effectiveness of controls - and concluded that an amount at the upper end of
our normal range was appropriate.
We agreed with the Audit Committee that we would report to them misstatements identified during our audit above
£499,500 (2022: £504,600 as well as misstatements below that amount that, in our view, warranted reporting for
qualitative reasons.
Conclusions relating to going concern
Our evaluation of the Directors’ assessment of the Company’s ability to continue to adopt the going concern basis of
accounting included:
· evaluating the Directors' updated risk assessment and considering whether it addressed relevant threats, including
Russia’s invasion of Ukraine, the rise of inflation and the wider macroeconomic uncertainty;
· evaluating the Directors' assessment of potential operational impacts, considering their consistency with other
available information and our understanding of the business and assessed the potential impact on the financial
statements;
· reviewing the Directors' assessment of the Company's financial position in the context of its ability to meet future
expected operating expenses and debt repayments, their assessment of liquidity as well as their review of the
operational resilience of the Company and oversight of key third-party service providers; and
· assessing the implication of significant reductions in Net Asset Value (NAV) as a result of market performance on the
ongoing ability of the Company to operate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions
that, individually or collectively, may cast significant doubt on the Company’s ability to continue as a going concern for a
period of at least twelve months from when the financial statements are authorised for issue.
In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting
in the preparation of the financial statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the
Company's ability to continue as a going concern.
In relation to the Directors’ reporting on how they have applied the UK Corporate Governance Code, we have nothing
material to add or draw attention to in relation to the Directors’ statement in the financial statements about whether the
Directors considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant
sections of this report.
Independent Auditors’ Report to the Members
of Murray Income Trust PLC
Continued
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Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and our
auditors’ report thereon. The Directors are responsible for the other information. Our opinion on the financial statements
does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent
otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge
obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency
or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement
of the financial statements or a material misstatement of the other information. If, based on the work we have
performed, we conclude that there is a material misstatement of this other information, we are required to report that
fact. We have nothing to report based on these responsibilities.
With respect to the Strategic report and Directors’ Report, we also considered whether the disclosures required by the
UK Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain
opinions and matters as described below.
Strategic report and Directors’ Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report and
Directors’ Report for the year ended 30 June 2023 is consistent with the financial statements and has been prepared in
accordance with applicable legal requirements.
In light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we
did not identify any material misstatements in the Strategic report and Directors’ Report.
Directors’ Remuneration
In our opinion, the part of the Directors' Remuneration Report to be audited has been properly prepared in accordance
with the Companies Act 2006.
Corporate governance statement
The Listing Rules require us to review the Directors’ statements in relation to going concern, longer-term viability and that
part of the corporate governance statement relating to the Company’s compliance with the provisions of the UK
Corporate Governance Code specified for our review. Our additional responsibilities with respect to the corporate
governance statement as other information are described in the Reporting on other information section of this report.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the
corporate governance statement is materially consistent with the financial statements and our knowledge obtained
during the audit, and we have nothing material to add or draw attention to in relation to:
· The Directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks;
· The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify
emerging risks and an explanation of how these are being managed or mitigated;
· The Directors’ statement in the financial statements about whether they considered it appropriate to adopt the going
concern basis of accounting in preparing them, and their identification of any material uncertainties to the Company’s
ability to continue to do so over a period of at least twelve months from the date of approval of the financial
statements;
· The Directors’ explanation as to their assessment of the Company’s prospects, the period this assessment covers and
why the period is appropriate; and
60 Murray Income Trust PLC
· The Directors’ statement as to whether they have a reasonable expectation that the Company will be able to continue
in operation and meet its liabilities as they fall due over the period of its assessment, including any related disclosures
drawing attention to any necessary qualifications or assumptions.
Our review of the Directors’ statement regarding the longer-term viability of the Company was substantially less in
scope than an audit and only consisted of making inquiries and considering the Directors’ process supporting their
statement; checking that the statement is in alignment with the relevant provisions of the UK Corporate Governance
Code; and considering whether the statement is consistent with the financial statements and our knowledge and
understanding of the Company and its environment obtained in the course of the audit.
In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements of
the corporate governance statement is materially consistent with the financial statements and our knowledge obtained
during the audit:
· The Directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced and understandable,
and provides the information necessary for the members to assess the Company's position, performance, business
model and strategy;
· The section of the Annual Report that describes the review of effectiveness of risk management and internal control
systems; and
· The section of the Annual Report describing the work of the Audit Committee.
We have nothing to report in respect of our responsibility to report when the Directors’ statement relating to the
Company’s compliance with the Code does not properly disclose a departure from a relevant provision of the Code
specified under the Listing Rules for review by the auditors.
Responsibilities for the financial statements and the audit
Responsibilities of the Directors for the financial statements
As explained more fully in the Statement of Directors' Responsibilities, the Directors are responsible for the preparation of
the financial statements in accordance with the applicable framework and for being satisfied that they give a true and
fair view. The Directors are also responsible for such internal control as they determine is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Company’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the Company or to cease operations, or have no realistic
alternative but to do so.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The
extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Independent Auditors’ Report to the Members
of Murray Income Trust PLC
Continued
Murray Income Trust PLC 61
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with
laws and regulations related to breaches of section 1158 of the Corporation Tax Act 2010, and we considered the extent
to which non-compliance might have a material effect on the financial statements. We also considered those laws and
regulations that have a direct impact on the financial statements such as the Companies Act 2006. We evaluated
management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of
override of controls), and determined that the principal risks were related to posting inappropriate journal entries to
increase revenue (investment income and capital gains) or to increase net asset value. Audit procedures performed by
the engagement team included:
· discussions with the AIFM and the audit committee, including specific enquiry of known or suspected instances of non-
compliance with laws and regulation and fraud where applicable;
· reviewing relevant meeting minutes, including those of the Audit Committee;
· assessment of the Company’s compliance with the requirements of section 1158 of the Corporation Tax Act 2010,
including recalculation of numerical aspects of the eligibility conditions;
· identifying and testing journal entries, in particular any material or revenue-impacting manual journal entries posted as
part of the Annual Report preparation process; and
· designing audit procedures to incorporate unpredictability around the nature, timing or extent of our testing.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances
of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the
financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not
detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
misrepresentations, or through collusion.
Our audit testing might include testing complete populations of certain transactions and balances, possibly using data
auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than testing
complete populations. We will often seek to target particular items for testing based on their size or risk characteristics.
In other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the sample
is selected.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the Company’s members as a body in
accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these
opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or
into whose hands it may come save where expressly agreed by our prior consent in writing.
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
· we have not obtained all the information and explanations we require for our audit; or
· adequate accounting records have not been kept by the company, or returns adequate for our audit have not been
received from branches not visited by us; or
· certain disclosures of directors’ remuneration specified by law are not made; or
· the financial statements and the part of the Directors’ Remuneration Report to be audited are not in agreement with
the accounting records and returns.
We have no exceptions to report arising from this responsibility.
62 Murray Income Trust PLC
Appointment
Following the recommendation of the Audit Committee, we were appointed by the members on 5 November 2019 to
audit the financial statements for the year ended 30 June 2020 and subsequent financial periods. The period of total
uninterrupted engagement is four years, covering the years ended 30 June 2020 to 30 June 2023.
Gillian Alexander (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
Edinburgh
19 September 2023
Independent Auditors’ Report to the Members
of Murray Income Trust PLC
Continued
Murray Income Trust PLC 63
Financial
Statements
L’Oréal , a portfolio company
purchased this year, owns a
number of globally recognised
consumer and professional
brands including Lancôme, Yves
Saint Laurent, Ralph Lauren,
Garnier, Maybelline and L’Oréal
Professional Paris.
64 Murray Income Trust PLC
Year ended 30 June 2023 Year ended 30 June 2022
Revenue Capital Total Revenue Capital Total
Notes £’000 £’000 £’000 £’000 £’000 £’000
Gains/(losses) on investments 10 - 32,602 32,602 - (83,786) (83,786)
Currency gains/(losses) - 733 733 - (216) (216)
Income 3 48,879 - 48,879 51,018 - 51,018
Investment management fees 4 (1,141) (2,663) (3,804) (1,199) (2,798) (3,997)
Administrative expenses 5 (1,390) - (1,390) (1,350) - (1,350)
Net return before finance costs and tax 46,348 30,672 77,020 48,469 (86,800) (38,331)
Finance costs 6 (735) (1,714) (2,449) (692) (1,615) (2,307)
Net return before tax 45,613 28,958 74,571 47,777 (88,415) (40,638)
Taxation 8 (1,085) - (1,085) (463) - (463)
Net return after tax 44,528 28,958 73,486 47,314 (88,415) (41,101)
Return per Ordinary share 9 38.7p 25.2p 63.9p 40.5p (75.7)p (35.2)p
The total column of this statement represents the profit and loss account of the Company prepared in accordance with FRS 102. The
‘Revenue’ and ‘Capital’ columns represent supplementary information prepared under guidance issued by the Association of
Investment Companies.
All revenue and capital items in the above statement derive from continuing operations.
No operations were acquired or discontinued in the year.
The accompanying notes are an integral part of the financial statements.
Statement of Comprehensive Income
Murray Income Trust PLC 65
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
As at As at
30 June 2023 30 June 2022
Notes £’000 £’000
Fixed assets
Investments at fair value through profit or loss 10 1,098,311 1,098,793
Current assets
Other debtors and receivables 11 7,274 9,061
Cash and cash equivalents 12 15,115 20,131
22,389 29,192
Creditors: amounts falling due within one year
Other payables (5,997) (1,513)
Bank loans (6,378) (6,507)
13 (12,375) (8,020)
Net current assets 10,014 21,172
Total assets less current liabilities 1,108,325 1,119,965
Creditors: amounts falling due after more than one year
2.51% Senior Loan Notes (39,941) (39,930)
4.37% Senior Loan Notes (69,200) (70,780)
14 (109,141) (110,710)
Net assets 999,184 1,009,255
Capital and reserves
Share capital 15 29,882 29,882
Share premium account 438,213 438,213
Capital redemption reserve 4,997 4,997
Capital reserve 489,428 502,672
Revenue reserve 36,664 33,491
Total Shareholders’ funds 999,184 1,009,255
Net asset value per Ordinary share 16
Debt at fair value 911.7p 871.0p
Debt at par value 894.4p 864.9p
The financial statements on pages 64 to 88 were approved by the Board of Directors and authorised for issue on 19 September 2023
and were signed on its behalf by:
Neil Rogan
Chair
The accompanying notes are an integral part of the financial statements.
Statement of Financial Position
66 Murray Income Trust PLC
For the year ended 30 June 2023
Share Capital
Share premium redemption Capital Revenue
capital account reserve reserve reserve Total
Notes £’000 £’000 £’000 £’000 £’000 £’000
Balance at 1 July 2022 29,882 438,213 4,997 502,672 33,491 1,009,255
Net return after tax - - - 28,958 44,528 73,486
Buyback of Ordinary shares for treasury 15 - - - (42,202) - (42,202)
Dividends paid 7 - - - - (41,355) (41,355)
Balance at 30 June 2023 29,882 438,213 4,997 489,428 36,664 999,184
For the year ended 30 June 2022
Share Capital
Share premium redemption Capital Revenue
capital account reserve reserve reserve Total
Notes £’000 £’000 £’000 £’000 £’000 £’000
Balance at 1 July 2021 29,882 438,213 4,997 594,282 26,485 1,093,859
Net (loss)/return after tax - - - (88,415) 47,314 (41,101)
Buyback of Ordinary shares for treasury 15 - - - (3,195) - (3,195)
Dividends paid 7 - - - - (40,308) (40,308)
Balance at 30 June 2022 29,882 438,213 4,997 502,672 33,491 1,009,255
The accompanying notes are an integral part of the financial statements.
Statement of Chan
g
es in Equity
Murray Income Trust PLC 67
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Year ended Year ended
30 June 2023 30 June 2022
Notes £’000 £’000
Operating activities
Net return/(loss) before finance costs and taxation 77,020 (38,331)
Adjustments for
Increase/(decrease) in accrued expenses 783 (80)
Overseas withholding tax (1,458) (1,360)
Increase in dividend income receivable (324) (270)
Increase in interest income receivable (54) (19)
Interest paid (2,196) (2,272)
(Gains)/losses on investments 10 (32,602) 83,786
Amortisation on loan notes 6 12 12
Accretion of loan note book cost 6 (1,581) (1,581)
Foreign exchange (gains)/losses (733) 216
Decrease in other debtors 47 46
Stock dividends included in investment income 3 (1,006) (3,728)
Net cash inflow from operating activities 37,908 36,419
Investing activities
Purchases of investments (180,130) (238,613)
Sales of investments 218,912 261,285
Net cash inflow from investing activities 38,782 22,672
Financing activities
Dividends paid 7 (41,355) (40,308)
Buyback of Ordinary shares for treasury (40,955) (3,195)
Repayment of bank loans (6,755) (6,290)
Draw down of bank loans 6,664 6,258
Net cash outflow from financing activities (82,401) (43,535)
(Decrease)/increase in cash (5,711) 15,556
Analysis of changes in cash during the year
Opening balance 20,131 4,493
Effect of exchange rate fluctuations on cash held 695 82
(Decrease)/increase in cash as above (5,711) 15,556
Closing balance 15,115 20,131
Represented by:
Cash at bank and in hand 12 1,227 1,503
Money market funds 12 13,888 18,628
15,115 20,131
The accompanying notes are an integral part of these financial statements.
Statement of Cash Flows
68 Murray Income Trust PLC
1. Principal activity
The Company is a closed-end investment company, registered in Scotland No SC012725, with its Ordinary shares being listed
on the London Stock Exchange.
2. Accountin
g
p
olicies
(a) Basis of preparation. The financial statements have been prepared in accordance with Financial Reporting Standard 102,
the Companies Act 2006 and with the Statement of Recommended Practice ‘Financial Statements of Investment Trust
Companies and Venture Capital Trusts’ issued in July 2022. The financial statements are prepared in Sterling which is the
functional currency of the Company and rounded to the nearest £’000. They have also been prepared on the
assumption that approval as an investment trust will continue to be granted. The accounting policies applied are
unchanged from the prior year and have been applied consistently.
The Directors have undertaken a rigorous review and consider both that there are no material uncertainties and that the
adoption of the going concern basis of accounting is appropriate. This conclusion is consistent with the longer term
Viability Statement on pages 22 and 23.
The Company’s assets consist primarily of a diverse portfolio of listed equity shares nearly all of which, in most
circumstances, are realisable within a short timescale. The Board has set limits for borrowing and regularly reviews the
level of any gearing, cash flow projections and compliance with banking and loan note covenants.
The Directors are mindful of the principal risks and uncertainties disclosed on pages 18 to 22, and have reviewed
forecasts detailing revenue and liabilities. The Directors are satisfied that the Company has adequate resources to
continue in operational existence for the foreseeable future, being at least 12 months from the date of approval of this
Annual Report.
(b) Income. Dividends receivable on equity shares are treated as revenue for the year on an ex-dividend basis. Where no ex-
dividend date is available dividends receivable on or before the year end are treated as revenue for the year. Where the
Company has elected to receive dividends in the form of additional shares rather than cash, the amount of the cash
dividend foregone is recognised as revenue and any residual amount is recognised as capital. Provision is made for any
dividends not expected to be received. Special dividends are credited to capital or revenue, according to the
circumstances. Dividend revenue is presented gross of any non-recoverable withholding taxes, which are disclosed
separately within the Statement of Comprehensive Income.
Interest receivable from cash and short-term deposits and stock lending income is recognised on an accruals basis.
(c) Expenses. All expenses are accounted for on an accruals basis. All expenses are charged through the revenue column of
the Statement of Comprehensive Income except as follows:
– transaction costs on the acquisition or disposal of investments are recognised as a capital item in the Statement of
Comprehensive Income.
– expenses are charged as a capital item in the Statement of Comprehensive Income where a connection with the
maintenance or enhancement of the value of the investments can be demonstrated. In this respect the investment
management fee has been allocated 30% to revenue and 70% to capital to reflect the Company’s investment policy and
prospective income and capital growth.
(d) Taxation. Taxation represents the sum of tax currently payable and deferred tax. Any tax payable is based on the
taxable profit for the year. Taxable profit differs from net profit as reported in the Statement of Comprehensive Income
because it excludes items of income or expense that are taxable or deductible in other years and it further excludes
items that are never taxable or deductible. The Company’s liability for current tax is calculated using tax rates that were
applicable at the Statement of Financial Position date.
Notes to the Financial Statements
For the year ended 30 June 2023
Murray Income Trust PLC 69
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the
Statement of Financial Position date, where transactions or events that result in an obligation to pay more tax in the
future or right to pay less tax in the future have occurred at the Statement of Financial Position date. This is subject to
deferred tax assets only being recognised if it is considered more likely than not that there will be suitable profits from
which the future reversal of the underlying timing differences can be deducted. Timing differences are differences
arising between the Company’s taxable profits and its results as stated in the financial statements which are capable of
reversal in one or more subsequent periods. Deferred tax is measured on a non-discounted basis at the tax rates that
are expected to apply in the periods in which timing differences are expected to reverse, based on tax rates and laws
enacted or substantively enacted at the Statement of Financial Position date.
Due to the Company’s status as an investment trust company and the intention to continue meeting the conditions
required to obtain approval in the foreseeable future, the Company has not provided deferred tax on any capital gains
and losses arising on the revaluation or disposal of investments.
The tax effect of different items of income/gain and expenditure/loss is allocated between capital and revenue within
the Statement of Comprehensive Income on the same basis as the particular item to which it relates using the
Company’s effective rate of tax for the year, based on the marginal basis.
(e) Valuation of investments. The Company has chosen to apply the recognition and measurement provisions of IAS 39
Financial Instruments: Recognition and Measurement. All investments have been designated upon initial recognition at
fair value through profit or loss. This is done because all investments are considered to form part of a group of financial
assets which is evaluated on a fair value basis, in accordance with the Company’s documented investment strategy,
and information about the grouping is provided internally on that basis. Investments are recognised and de-recognised
at trade date where a purchase or sale is under a contract whose terms require delivery within the timeframe
established by the market concerned, and are measured initially at fair value. Subsequent to initial recognition,
investments are valued at fair value through profit or loss. For listed investments, this is deemed to be bid market prices or
closing prices for SETS (London Stock Exchange’s electronic trading service) stocks sourced from the London Stock
Exchange. Gains and losses arising from changes in fair value are included in the net return for the period as a capital
item in the Statement of Comprehensive Income and are ultimately recognised in the capital reserve.
(f) Cash and cash equivalents. Cash comprises cash in hand and demand deposits. Cash equivalents are short-term, highly
liquid investments that are readily convertible to known amounts of cash and that are subject to insignificant risk of
change in value.
(g) Borrowings and finance costs. Borrowings of interest bearing bank loans and 2.51% Senior Loan Notes are recognised
initially at the fair value of the consideration received, net of any issue expenses, and subsequently at amortised cost
using the effective interest method. Borrowings of 4.37% Senior Loan Notes, which were novated to the Company on the
merger with Perpetual Income and Growth Investment Trust plc, were recorded initially at their fair value of £73,344,000
and are amortised over the remaining life of the loan towards their redemption value of £60,000,000. The amortisation
adjustment is presented as a finance cost. Finance costs accrue using the effective interest rate over the life of the
borrowings and are allocated 30% to revenue and 70% to capital.
(h) Traded options. The Company may enter into certain derivative contracts (eg options) to gain exposure to the market.
The option contracts are classified as fair value through profit or loss, held for trading, and accounted for as separate
derivative contracts and are therefore shown in other assets or other liabilities at their fair value ie market value. The
premium on the option (as with written options generally) is treated as the option’s initial fair value and is recognised
over the life of the option in the revenue column of the Statement of Comprehensive Income along with fair value
changes in the open position which occur due to the movement in underlying securities. Losses realised on the exercise
of the contracts are recorded in the capital column of the Statement of Comprehensive Income as they arise. Where
the Company enters into derivative contracts to manage market risk, gains or losses arising on such contracts are
recorded in the capital column of the Statement of Comprehensive Income.
70 Murray Income Trust PLC
(i) Segmental reporting. The Directors are of the opinion that the Company is engaged in a single segment of business
activity, being investment business. Consequently, no business segmental analysis is provided.
(j) Nature and purpose of reserves
Share capital. The Ordinary share capital on the Statement of Financial Position relates to the number of shares in issue
and in treasury. Only when the shares are cancelled, either from treasury or directly, is a transfer made to the capital
redemption reserve. This is a non-distributable reserve.
Share premium account. The balance classified as share premium includes the premium above nominal value from the
proceeds on issue of any equity share capital comprising Ordinary shares of 25p and includes the premium arising
following the issue of shares on the combination with Perpetual Income and Growth Investment Trust plc on 17
November 2020. This is a non-distributable reserve.
Capital redemption reserve. The capital redemption reserve reflects the cancellation of Ordinary shares, when an
amount equal to the par value of the Ordinary share capital is transferred from the share capital reserve to the capital
redemption reserve. This is a non-distributable reserve.
Capital reserve. This reserve reflects any gains or losses on investments realised in the period along with any movements
in the fair value of investments held that have been recognised in the Statement of Comprehensive Income. These
include gains and losses from foreign currency exchange differences. Additionally, expenses, including finance costs,
are charged to this reserve in accordance with (b) and (f) above. When making a distribution to shareholders, the
Directors determine profits available for distribution by reference to ‘Guidance on realised and distributable profits
under the Companies Act 2006’ issued by the Institute of Chartered Accountants in England and Wales and the Institute
of Chartered Accountants of Scotland in April 2017. The availability of distributable reserves in the Company is
dependent on those distributions meeting the definition of qualifying consideration within the guidance and on available
cash resources of the Company and other accessible sources of funds. The distributable reserves are therefore subject
to any future restrictions or limitations at the time such distribution is made.
The capital reserve, to the extent it constitutes realised profits, is distributable. This may include unrealised (losses)/gains
on investments where these are readily convertible to cash. The amount of the capital reserve that is distributable is
complex to determine and is not necessarily the full amount of the reserve as disclosed within these financial statements
of £489,428,000 as at 30 June 2023 as this is subject to fair value movements and may not be readily realisable at
short notice.
Revenue reserve. This reserve reflects all income and costs which are recognised in the revenue column of the
Statement of Comprehensive Income. The revenue reserve is distributable by way of dividend.
(k) Treasury shares. When the Company buys back the Company’s equity share capital as treasury shares, the amount of
the consideration paid, including directly attributable costs and any tax effects, is recognised as a deduction from equity.
When these shares are sold or reissued subsequently, the net amount received is recognised as an increase in equity,
and the resulting surplus or deficit on the transaction is transferred to or from the capital reserve.
(l) Dividends payable. Final dividends are recognised from the date on which they are approved by Shareholders. Interim
dividends are recognised when paid. Dividends are shown in the Statement of Changes in Equity.
(m) Foreign currency. Transactions in foreign currencies are converted to Sterling at the exchange rate ruling at the date of
the transaction. Monetary assets and liabilities and non-monetary assets held at fair value denominated in foreign
currencies are translated into Sterling at rates of exchange ruling at the Statement of Financial Position date. Exchange
gains and losses are taken to the Statement of Comprehensive Income as a capital or revenue item depending on the
nature of the underlying item.
Notes to the Financial Statements
Continued
Murray Income Trust PLC 71
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
(n) Significant estimates and judgements. The Directors do not believe that any accounting estimates or judgements have
been applied to these financial statements that have a significant risk of causing material adjustment to the carrying
amount of assets and liabilities.
3. Income
2023 2022
£’000 £’000
Income from investments
UK dividends (all listed):
- ordinary 32,132 32,710
- special 353 1,676
Property income dividends 814 1,153
Overseas dividends (all listed)
- ordinary 10,343 8,731
- special 756 160
Stock dividends 1,006 3,728
45,404 48,158
Other income
Deposit interest 34 7
Money Market interest 682 32
Traded option premiums 2,759 2,820
Compensation payments - 1
3,475 2,860
Total income 48,879 51,018
All special dividends for the year of £1,109,000 (2022 - £1,836,000) have been recognised as being revenue in nature.
During the year, the Company received premiums totalling £2,759,000 (2022 - £2,820,000) in exchange for entering into
derivative transactions. At the year end there were no open positions (2022 - none).
72 Murray Income Trust PLC
4. Investment management fees
2023 2022
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Management fee 1,141 2,663 3,804 1,199 2,798 3,997
The management fee is based on 0.55% per annum for net assets up to £350 million, 0.45% per annum on the next £100 million
of net assets and 0.25% per annum for net assets over £450 million, calculated and payable monthly. The fee has been
allocated 30% to revenue and 70% to capital. The management agreement is terminable on three months’ notice. The fee
payable to the Manager at the year end was £1,273,000 (2022 – £642,000).
Under the terms of the management agreement, the value of the Company’s investments in commonly managed funds is
excluded from the calculation of the management fee. The Company held no such commonly managed funds at the year
end (2022 – none).
5. Administrative expenses
2023 2022
£’000 £’000
Shareholders’ services
A
418 400
Directors’ remuneration
B
188 193
Secretarial fees
C
75 75
Registrars fees 76 110
Depositary fees 90 96
Custody fees 68 60
Printing and postage 61 34
Auditor’s remuneration:
– fees payable to the Company’s auditor for the audit of the Company’s
annual financial statements
42 42
Legal and professional fees 38 51
Irrecoverable VAT
D
164 126
Other expenses 170 163
1,390 1,350
A
Includes savings scheme and other wrapper administration and promotion expenses, paid to the Manager under a delegation agreement with the Manager to cover
promotional activities during the year. There was £106,000 (2022 – £100,000) due to the Manager in respect of these promotional activities at the year end.
B
Refer to the Directors’ Remuneration section of the Directors’ Remuneration Report on page 49 for further details.
C
Payable to the Manager, balance outstanding of £19,000 (2022 – £19,000) at the year end.
D
The Company was granted VAT registered status on 18 March 2022, backdated to 1 January 2021. As a result the prior year irrecoverable VAT includes backdated
VAT of £28,000.
Notes to the Financial Statements
Continued
Murray Income Trust PLC 73
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
6. Finance costs
2023 2022
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Bank loans and overdraft interest 118 274 392 75 175 250
2.51% Senior Loan Note 301 703 1,004 301 703 1,004
4.37% Senior Loan Note 787 1,835 2,622 787 1,835 2,622
Amortisation of 2.51% Senior Loan Note issue expenses 3 9 12 3 9 12
Amortisation of 4.37% Senior Loan Note (474) (1,107) (1,581) (474) (1,107) (1,581)
735 1,714 2,449 692 1,615 2,307
Details of the Loan Notes and their amortisation are set out in note 14. Finance costs are allocated 30% to revenue and 70% to
capital.
7. Ordinary dividends on equity shares
2023 2022
Rate £’000 Rate £’000
Fourth interim dividend previous year 11.25p 13,128 9.75p 11,412
First interim dividend current year 8.25p 9,556 8.25p 9,641
Second interim dividend current year 8.25p 9,431 8.25p 9,628
Third interim dividend current year 8.25p 9,337 8.25p 9,627
Return of unclaimed dividends (97) –
41,355 40,308
The fourth interim dividend for 2023 of 12.75p per Ordinary share has not been included as a liability in these financial
statements as it was not paid until after the reporting date (14 September 2023).
74 Murray Income Trust PLC
The following table sets out the total dividends paid and proposed in respect of the financial year, which is the basis on which
the requirements of Section 1158–1159 of the Corporation Tax Act 2010 are considered. The revenue available for distribution
by way of dividend for the year is £44,528,000 (2022 – £47,314,000).
2023 2022
Rate £’000 Rate £’000
Three interim dividends of 8.25p each (2022: same) 24.75p 28,324 24.75p 28,896
Fourth interim dividend 12.75p 14,088 11.25p 13,128
37.50p 42,412 36.00p 42,024
8. Taxation
2023 2022
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
(a) Analysis of charge for the year
Overseas tax incurred 2,244 – 2,244 1,961 – 1,961
Overseas tax reclaimable (1,159) – (1,159) (1,498) – (1,498)
Total tax charge for the year 1,085 – 1,085 463 – 463
Notes to the Financial Statements
Continued
Murray Income Trust PLC 75
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
(b) Factors affecting the tax charge for the year. The UK corporation tax rate is 25% (2022 – 19%). The tax charge for the year
is lower than the corporation tax rate (2022 – lower). The differences are explained below:
2023 2022
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Net return before taxation 45,613 28,958 74,571 47,777 (88,415) (40,638)
Net return multiplied by the effective rate of
corporation tax of 20.5% (2022 – 19%)
9,351 5,936 15,287 9,078 (16,799) (7,721)
Effects of:
Non-taxable UK dividends (6,057) – (6,057) (6,305) – (6,305)
Non-taxable overseas dividends (3,008) – (3,008) (2,553) – (2,553)
Expenses not deductible for tax purposes 2 – 2 56 – 56
Movement in unutilised management expenses (288) 897 609 (276) 839 563
Realised and unrealised losses/(gains) on
investments held
– (6,683) (6,683) – 15,919 15,919
Currency movements not taxable – (150) (150) – 41 41
Overseas tax payable 1,085 – 1,085 463 – 463
Total tax charge 1,085 – 1,085 463 – 463
(c) Factors that may affect future tax charges. No provision for deferred tax has been made in the current or prior
accounting period.
The Company has not provided for deferred tax on capital gains or losses arising on the revaluation or disposal of
investments as it is exempt from tax on these items because of its status as an investment trust company.
At the year end, the Company has, for taxation purposes only, accumulated unrelieved management expenses and
loan relationship deficits of £74,422,000 (2022 – £71,665,000). A deferred tax asset at the standard rate of corporation of
25% (2022 – 25%) of £18,606,000 (2022 – £17,916,000) has not been recognised and these expenses will only be utilised if
the Company has profits chargeable to corporation tax in the future. It is considered highly unlikely that the Company will
generate such profits and therefore no deferred tax asset has been recognised. The Finance Act 2021 received Royal
Assent on 10 June 2021 and the rate of Corporation Tax of 25% effective from 1 April 2023 has been used to calculate
the potential deferred tax asset of £18,606,000.
76 Murray Income Trust PLC
9. Return per Ordinary share
2023 2022
£’000 p £’000 p
Returns are based on the following figures:
Revenue return 44,528 38.70 47,314 40.5
Capital return 28,958 25.2 (88,415) (75.7)
Total return 73,486 63.9 (41,101) (35.2)
Weighted average number of Ordinary shares in issue 114,958,339 116,831,407
10. Investments at fair value through profit or loss
2023 2022
£’000 £’000
Opening book cost 1,017,087 995,661
Opening investment holdings gains 81,706 206,629
Opening fair value 1,098,793 1,202,290
Analysis of transactions made during the year
Purchases at cost 183,338 241,150
Sales proceeds received (216,422) (260,861)
Gains/(losses) on investments 32,602 (83,786)
Closing fair value 1,098,311 1,098,793
2023 2022
£’000 £’000
Closing book cost 989,936 1,017,087
Closing investment gains 108,375 81,706
Closing fair value 1,098,311 1,098,793
2023 2022
Gains/(losses) on investments £’000 £’000
Realised gains on sale of investments at fair value 5,988 41,137
Realised loss on exercise of put options (55) –
Net movement in investment holdings gains 26,669 (124,923)
32,602 (83,786)
Notes to the Financial Statements
Continued
Murray Income Trust PLC 77
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The Company received £216,422,000 (2022 – £260,861,000) from investments sold in the year. The book cost of these
investments when they were purchased was £210,434,000 (2022 – £219,724,000). These investments have been revalued over
time and until they were sold any unrealised gains/(losses) were included in the fair value of the investments.
The Company may write and purchase both exchange traded and over the counter derivative contracts as part of its
investment policy. The Company pledges collateral greater than the market value of the traded options in accordance with
standard commercial practice. At 30 June 2023 there were no shares pledged as part of the option underwriting programme
(30 June 2022 – none). The liability of collateral held at the year end was £nil as no open positions existed (30 June 2022 – £nil).
Transaction costs. During the year expenses were incurred in acquiring or disposing of investments classified at fair value
through profit or loss. These have been expensed through capital and are included within gains on investments in the
Statement of Comprehensive Income. The total costs were as follows:
2023 2022
£’000 £’000
Purchases 797 885
Sales 144 146
941 1,031
The above transaction costs are calculated in line with the AIC SORP. The transaction costs in the Company’s Key Information
Document are calculated on a different basis and in line with the PRIIPs regulations.
11. Other debtors and receivables
2023 2022
£’000 £’000
Amounts due from brokers – 2,490
Accrued income 3,080 2,685
Taxation recoverable 4,170 3,844
Prepayments 24 42
7,274 9,061
78 Murray Income Trust PLC
12. Cash and cash equivalents
2023 2022
£’000 £’000
Cash at bank and in hand 1,227 1,503
Money market funds 13,888 18,628
15,115 20,131
The Company holds £13,888,000 (2022 – £18,628,000) in Aberdeen Standard Liquidity Fund (Lux) – Sterling Fund which is
managed and administered by abrdn.
13. Creditors: amounts falling due within one year
2023 2022
£’000 £’000
Other creditors 2,548 1,513
Amounts due to brokers for purchases of investments 2,202 –
Amounts due to brokers for buyback of Ordinary shares for treasury 1,247 –
Bank loans 6,378 6,507
12,375 8,020
The Company has a three year £50 million multi-currency unsecured revolving bank credit facility with Bank of Nova Scotia
Limited, committed until 27 October 2024. Under the terms of the agreement, advances from the facility may be made for
periods of up to six months or for such longer periods agreed by the lender.
As at 30 June 2023, the Company had drawn down the following amounts from the facility, all with a maturity date of
26 July 2023 (2022 – 27 July 2022):
2023 2022
Currency £’000 Currency £’000
Swiss Franc at an all-in rate of 2.798% (2022: 1.35%) 1,200,000 1,055 2,500,000 2,150
Euro at an all-in rate of 4.563% (2022: 1.15%) 3,300,000 2,832 2,326,000 2,002
Norwegian Krone at an all-in rate of 5.11% (2022: 2.59%) 6,360,000 467 13,145,000 1,096
Danish Krona at an all-in rate of 4.56% (2022: 1.15%) 6,850,000 789 5,410,000 626
US Dollar at an all-in rate of 6.314% (2022: 2.70%) 1,570,000 1,235 768,000 633
6,378 6,507
Notes to the Financial Statements
Continued
Murray Income Trust PLC 79
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
At the date this Report was approved, the Company had drawn down the following amounts from the facility, all with a
maturity date of 25 September 2023:
– Swiss Franc 1,200,000 at an all-in rate of 3.056%, equivalent to £1,079,000.
– Euro 3,300,000 at an all-in rate of 4.792%, equivalent to £2,840,000.
– Norwegian Krone 6,360,000 at an all-in rate of 5.41%, equivalent to £477,000.
– Danish Krona 6,850,000 at an all-in rate of 4.84%, equivalent to £790,000.
– US Dollar 1,570,000 at an all-in rate of 6.564%, equivalent to £1,267,000.
Financial covenants contained within the facility agreement provide, inter alia, that the ratio of net assets to borrowings must
be greater than 3.5:1 and that net assets must exceed £550 million. All financial covenants were met during the year and also
during the period from the year end to the date of this report.
14. Creditors: amounts falling due after more than one year
2023 2022
£’000 £’000
2.51% Senior Loan Note 40,000 40,000
Unamortised 2.51% Senior Loan Note issue expenses (59) (70)
39,941 39,930
4.37% Senior Loan Note at fair value 73,344 73,344
Amortisation of 4.37% Senior Loan Note (4,144) (2,564)
69,200 70,780
109,141 110,710
On 8 November 2017 the Company issued £40,000,000 of 10 year Senior Loan Notes at a fixed rate of 2.51%. Interest is
payable in half yearly instalments in May and November and the Loan Notes are due to be redeemed at par on
8 November 2027.
As a result of the transaction with Perpetual Income and Growth Investment Trust plc on 17 November 2020, £60,000,000 of
15 year Senior Loan Notes at a fixed rate of 4.37% issued on 8 May 2014 were novated to the Company. Under FRS 102 the
loan notes are required to be recorded initially at their fair value of £73,344,000 in the Company’s Financial Statements and
are then amortised over the remaining life of the loan towards their redemption value of £60,000,000. The amortisation
adjustment is presented as a finance cost, split 70% to capital and 30% to revenue. Interest is payable in half yearly
instalments in May and November and the Loan Notes are due to be redeemed at par on 8 May 2029.
Both the Loan Notes are secured by a floating charge over the whole of the assets of the Company and rank pari passu. The
Company has complied with the Senior Loan Note Purchase Agreements covenants throughout the year that the ratio of net
assets to gross borrowings must be greater than 3.5:1, and that net assets will not be less than £550,000,000.
80 Murray Income Trust PLC
15. Share capital
2023 2022
Shares £’000 Shares £’000
Allotted, called-up and fully-paid:
Ordinary shares of 25p each: publicly held 111,720,001 27,930 116,690,472 29,172
Ordinary shares of 25p each: held in treasury 7,809,531 1,952 2,839,060 710
119,529,532 29,882 119,529,532 29,882
During the year 4,970,471 Ordinary shares were bought back (2022 – 356,015) to be held in treasury by the Company at a
total cost of £42,202,000 (2022– £3,195,000) representing 4.3% (2022 – 0.3%) of called-up share capital excluding Ordinary
shares held in treasury at the start of the year.
16. Net asset value per Ordinary share
The net asset value per Ordinary share and the net asset value attributable to the Ordinary shares at the year end follow.
These were calculated using 111,720,001 (2022 – 116,690,472) Ordinary shares in issue at the year end (excluding
treasury shares).
2023 2022
Net Asset Value Attributable Net Asset Value Attributable
£’000 pence £’000 pence
Net asset value – debt at par 999,184 894.4 1,009,255 864.9
Add: amortised cost of 2.51% Senior Loan Notes 39,941 35.8 39,930 34.1
Less: fair value of 2.51% Senior Loan Notes (34,928) (31.3) (39,725) (33.9)
Add: amortised cost of 4.37% Senior Loan Notes 69,200 61.9 70,780 60.5
Less: fair value of 4.37% Senior Loan Notes (54,900) (49.1) (63,905) (54.6)
Net asset value – debt at fair value 1,018,497 911.7 1,016,335 871.0
Note 19 sets out the basis used to estimate the fair value of the Loan Notes.
Notes to the Financial Statements
Continued
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Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
17. Analysis of changes in net debt
At Currency Non-cash At
01 July 2022 differences Cash flows movements 30 June 2023
£’000 £’000 £’000 £’000 £’000
Cash and cash equivalents* 20,131 695 (5,711) – 15,115
Debt due within one year (6,507) 38 91 – (6,378)
Debt due after more than one year (110,710) – – 1,569 (109,141)
(97,086) 733 (5,620) 1,569 (100,404)
At Currency Non-cash At
01 July 2021 differences Cash flows movements 30 June 2022
£’000 £’000 £’000 £’000 £’000
Cash and cash equivalents* 4,493 82 15,556 – 20,131
Debt due within one year (6,241) (298) 32 – (6,507)
Debt due after more than one year (112,279) – – 1,569 (110,710)
(114,027) (216) 15,588 1,569 (97,086)
* An analysis of cash and cash equivalents between cash at bank and in hand and money market funds is provided in note 12.
A statement reconciling the movement in net funds to the net cash flow has not been presented as there are no differences
from the above analysis.
18. Financial instruments
This note summarises the risks deriving from the financial instruments that comprise the Company’s assets and liabilities.
The Company’s investment activities expose it to various types of financial risk associated with the financial instruments and
markets in which it invests. The Company’s financial instruments, other than derivatives, comprise securities and other
investments, cash balances, liquid resources, loans and debtors and creditors that arise directly from its operations; for example,
in respect of sales and purchases awaiting settlement, and debtors for accrued income. The Company also has the ability to
enter into derivative transactions in the form of forward foreign currency contracts, futures and options, subject to Board
approval, for the purpose of enhancing portfolio returns and for hedging purposes in a manner consistent with the Company’s
broader investment policy. As at 30 June 2023 there were no open positions in derivatives transactions (2022 – same).
Risk management framework. The directors of abrdn Fund Managers Limited collectively assume responsibility for the Manager’s
obligations under the AIFMD including reviewing investment performance and monitoring the Company’s risk profile during the year.
The Manager is a wholly owned subsidiary of the abrdn Group (“the Group”), which provides a variety of services and support
to the Manager in the conduct of its business activities, including in the oversight of the risk management framework for the
Company. The Manager has delegated the day to day administration of the investment policy to abrdn Investments Limited,
which is responsible for ensuring that the Company is managed within the terms of its investment guidelines and the limits set
out in its pre-investment disclosures to investors (details of which can be found on the Company’s website). The Manager has
retained responsibility for monitoring and oversight of investment performance, product risk and regulatory and operational
risk for the Company.
82 Murray Income Trust PLC
The Manager conducts its risk oversight function through the operation of the Group’s risk management processes and
systems which are embedded within the Group’s operations. The Group’s Risk Division (“the Risk Division”) supports
management in the identification and mitigation of risks and provides independent monitoring of the business. The Risk Division
includes Compliance, Business Risk, Market Risk, Risk Management and Legal. The team is headed up by the Group’s Chief Risk
Officer, who reports to the Chief Executive Officer (“CEO”) of the Group. The Risk Division achieves its objective through
embedding the Risk Management Framework throughout the organisation using the Group’s operational risk management
system (“SHIELD”).
The Group’s Internal Audit Department is independent of the Risk Division and reports directly to the Group CEO and to the
Audit Committee of the Group’s Board of Directors. The Internal Audit Department is responsible for providing an independent
assessment of the Group’s control environment.
The Group’s corporate governance structure is supported by several committees to assist the board of directors, its
subsidiaries and the Company to fulfil their roles and responsibilities. The Group’s Risk Division is represented on all committees,
with the exception of those committees that deal with investment recommendations. The specific goals and guidelines on the
functioning of those committees are described in the committees’ terms of reference.
Risk management of the financial instruments. The main risks the Company faces from these financial instruments are (a)
market risk (comprising (i) interest rate, (ii) foreign currency and (iii) other price risk), (b) liquidity risk and (c) credit risk.
In order to mitigate risk, the investment strategy is to select investments for their fundamental value. Stock selection is
therefore based on disciplined accounting, market and sector analysis. It is the Board’s policy to hold an appropriate spread of
investments in the portfolio in order to reduce the risk arising from factors specific to a particular sector. The Attribution
Analysis, detailing the allocation of assets and the stock selection, is shown in the Performance Attribution table on page 10.
The Investment Manager actively monitors market prices throughout the year and reports to the Board, which meets
regularly in order to consider investment strategy. The Company’s strategy is detailed in the Chair’s Statement on pages 4 to 8,
in the Investment Manager’s Report on pages 9 to 13 and in Overview of Strategy on page 23.
The Board has agreed the parameters for net gearing, which was 10.4% of net assets as at 30 June 2023 (2022 – 9.4%). The
Manager’s policies for managing these risks are summarised below and have been applied throughout the current and
previous year. The numerical disclosures in the tables listed below exclude short-term debtors and creditors.
18 (a) Market risk. The Company’s investment portfolio is exposed to market price fluctuations, which are monitored by the
Manager in pursuance of the investment objective as set out on page 17. Adherence to investment guidelines and to
investment and borrowing powers set out in the management agreement mitigates the risk of exposure to any particular
security or issuer. Further information on the investment portfolio is set out in the Investment Manager’s Report on pages
9 to 13.
Market price risk arises mainly from uncertainty about future prices of financial instruments used in the Company’s operations.
It represents the potential loss the Company might suffer through holding market positions as a consequence of price
movements. It is the Board’s policy to hold equity investments in the portfolio in a broad spread of sectors in order to reduce
the risk arising from factors specific to a particular sector. An analysis of the equity portfolio by sector is on page 30 and a
summary of investment changes during the year is on page 31.
18 (a)(i) Interest rate risk
Interest rate movements may affect:
– the level of income receivable on cash deposits;
– interest payable on the Company’s variable rate borrowings; and
– the fair value of any investments in fixed interest rate securities.
Notes to the Financial Statements
Continued
Murray Income Trust PLC 83
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Management of the risk. The possible effects on fair value and cash flows that could arise as a result of changes in interest rates
are taken into account when making investment and borrowing decisions. Details of the bank loan and interest rates
applicable can be found in note 13.
The Board imposes borrowing limits to ensure gearing levels are appropriate to market conditions and reviews these on a
regular basis. Interest rate risk is the risk of movements in the value of financial instruments as a result of fluctuations in
interest rates.
Financial assets. The interest rate risk of the portfolio of financial assets at the reporting date was as follows:
Floating rate Non-interest bearing
2023 2022 2023 2022
£’000 £’000 £’000 £’000
Danish Krona – 93 22,239 20,888
Euro – 268 69,528 46,543
Norwegian Krone – 66 9,323 20,582
Singapore Dollars – – 21,124 14,833
Sterling 15,115 19,704 898,427 942,138
Swedish Krone – – 16,694 14,075
Swiss Francs – – 36,060 23,009
Taiwan Dollars – – 7,051 5,273
US Dollars – – 17,865 11,452
Total 15,115 20,131 1,098,311 1,098,793
The floating rate assets of cash at bank and in hand and cash held in money market funds earn interest at the prevailing
market rates.
The non-interest bearing assets represent the equity element of the portfolio.
Financial liabilities. The Company has floating rate borrowings by way of its loan facility and fixed rate senior loan note issues,
details of which are in notes 13 and 14.
Interest rate sensitivity. The sensitivity analysis below has been determined based on the exposure to interest rates for both
derivative and non-derivative instruments at the reporting date and the stipulated change taking place at the beginning of the
financial year and held constant in the case of instruments that have floating rates.
84 Murray Income Trust PLC
If interest rates had been 1% higher or lower and all other variables were held constant, the Company’s profit before tax for the
year ended 30 June 2023 and net assets would increase/decrease by £53,000 (2022 – £161,000) respectively. This is mainly
attributable to the Company’s exposure to interest rates on its floating rate cash balances and borrowings.
18 (a)(ii) Foreign currency risk. A proportion of the Company’s investment portfolio is invested in overseas securities whose
values are subject to fluctuation due to changes in foreign exchange rates. In addition, the impact of changes in foreign
exchange rates upon the profits of investee companies can result, indirectly, in changes in their valuations. Consequently, the
Statement of Financial Position can be affected by movements in exchange rates.
Management of the risk. The revenue account is subject to currency fluctuations arising on dividends receivable in foreign
currencies and, indirectly, due to the impact of foreign exchange rates upon the profits of investee companies. It is not
the Company’s policy to hedge this currency risk but the Board keeps under review the currency returns in both capital
and income.
Foreign currency risk exposure by currency of denomination falling due within one year is set out in the table below. Net
monetary assets/(liabilities) comprise cash and loan balances and exclude other debtors and receivables and other payables
(including amounts due to or from brokers).
30 June 2023 30 June 2022
Net Net
monetary Total monetary Total
assets/ currency assets/ currency
Investments (liabilities) exposure Investments (liabilities) exposure
£’000 £’000 £’000 £’000 £’000 £’000
Danish Krona 22,239 (789) 21,450 20,888 (533) 20,355
Euro 69,528 (2,832) 66,696 46,543 (1,734) 44,809
Norwegian Krone 9,323 (467) 8,856 20,582 (1,030) 19,552
Singapore Dollars 21,124 – 21,124 14,833 – 14,833
Swedish Krone 16,694 – 16,694 14,075 – 14,075
Swiss Francs 36,060 (1,055) 35,005 23,009 (2,150) 20,859
Taiwan Dollars 7,051 – 7,051 5,273 – 5,273
US Dollars 17,865 (1,235) 16,630 11,452 (633) 10,819
Total 199,884 (6,378) 193,506 156,655 (6,080) 150,575
Notes to the Financial Statements
Continued
Murray Income Trust PLC 85
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Foreign currency sensitivity. The following table details the impact on the Company’s net assets to a 10% decrease (in the
context of a 10% increase the figures below should all be read as negative) in Sterling against the foreign currencies in which
the Company has exposure. The sensitivity analysis includes foreign currency denominated monetary and non-monetary
items and adjusts their translation at the period end for a 10% change in foreign currency rates.
2023 2022
£’000 £’000
Danish Krona 2,145 2,036
Euro 6,670 4,481
Norwegian Krone 886 1,955
Singapore Dollars 2,112 1,483
Swedish Krone 1,669 1,408
Swiss Francs 3,501 2,086
Taiwan Dollars 705 527
US Dollars 1,663 1,082
Total 19,351 15,058
18(a)(iii) Other price risk. Other price risks (ie changes in market prices other than those arising from interest rate or currency
risk) may affect the value of the quoted investments.
Management of the risk. It is the Board’s policy to hold an appropriate spread of investments in the portfolio in order to reduce
the risk arising from factors specific to a particular sector. The allocation of assets to international markets and the stock
selection process, as detailed in the section “Delivering the Investment Policy” on page 17, both act to reduce market risk. The
Manager actively monitors market prices throughout the year and reports to the Board, which meets regularly in order to
review investment strategy.
Other price risk sensitivity. If market prices at the reporting date had been 10% higher or lower while all other variables
remained constant, the return attributable to Ordinary shareholders and equity for the year ended 30 June 2023 would have
increased/decreased by £109,831,000 (2022 – £109,879,000).
86 Murray Income Trust PLC
18 (b) Liquidity risk. This is the risk that the Company will encounter difficulty in meeting obligations associated with financial
liabilities as they fall due in line with the maturity profile analysed as follows:
Within Within Within More than
1 year 1-3 years 3-5 years 5 years Total
At 30 June 2023 £000 £000 £000 £000 £000
Bank loans 6,378 – – – 6,378
2.51% Senior Loan Note 8/11/27 – – 40,000 – 40,000
4.37% Senior Loan Note 8/5/29 – – – 60,000 60,000
Interest cash flows on bank loans 3 – – – 3
Interest cash flows on 2.51% Senior Loan Note 1,004 2,008 1,506 – 4,518
Interest cash flows 4.37% Senior Loan Note 2,622 5,244 5,244 2,622 15,732
Cash flows on other creditors 5,997 – – – 5,997
16,004 7,252 46,750 62,622 132,628
Within Within Within More than
1 year 1-3 years 3-5 years 5 years Total
At 30 June 2022 £000 £000 £000 £000 £000
Bank loans 6,507 – – – 6,507
2.51% Senior Loan Note 8/11/27 – – – 40,000 40,000
4.37% Senior Loan Note 8/5/29 – – – 60,000 60,000
Interest cash flows on bank loans 1 – – – 1
Interest cash flows on 2.51% Senior Loan Note 1,004 2,008 2,008 502 5,522
Interest cash flows 4.37% Senior Loan Note 2,622 5,244 5,244 5,244 18,354
Cash flows on other creditors 1,513 – – – 1,513
11,647 7,252 7,252 105,746 131,897
Management of the risk. The Company’s assets comprise readily realisable securities which can be sold to meet funding
commitments if necessary. Short-term flexibility is achieved through the use of committed loan and overdraft facilities.
As at 30 June 2023 the Company utilised £6,378,000 (2022 – £6,507,000) of a £50,000,000 multi–currency revolving bank credit
facility, which is committed until 27 October 2024. Details of maturity dates and interest charges can be found in note 13. The
aggregate of all future interest payments at the rate ruling at 30 June 2023 and the redemption of the loan amounted to
£6,381,000 (2022 – £6,508,000).
Notes to the Financial Statements
Continued
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18 (c) Credit risk. This is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other
party to incur a financial loss.
Management of the risk. The risk is mitigated by the Manager reviewing the credit ratings of counterparties. The risk attached
to dividend flows is mitigated by the Investment Manager’s research of potential investee companies. The Company’s
custodian bank is responsible for the collection of income on behalf of the Company and its performance is reviewed by the
Depositary (on an ongoing basis) and by the Board on a regular basis. It is the Manager’s policy to trade only with A– and above
(Long Term rated) and A–1/P–1 (Short Term rated) counterparties. The maximum credit risk at 30 June 2023 is £18,123,000
(30 June 2022 – £25,306,000) consisting of £3,080,000 (2022 – £2,685,000) of dividends receivable from equity shares, £nil
(2022 – £2,490,000) receivable from brokers and £15,115,000 (2022 – £20,131,000) in cash and cash equivalents.
None of the Company’s financial assets are past due or impaired (2022 – none).
19. Fair value hierarchy
FRS 102 requires an entity to classify fair value measurements using a fair value hierarchy that reflects the significance of the
inputs used in making the measurements. Categorisation within the hierarchy is determined on the basis of the lowest level
input that is significant to the fair value measurement of each relevant asset or liability. The fair value hierarchy has the
following levels:
Level 1: unadjusted quoted prices in an active market for identical assets or liabilities that the entity can access at the
measurement date;
Level 2: inputs other than quoted prices included within Level 1 that are observable (ie developed using market data) for the
asset or liability, either directly or indirectly; and
Level 3: inputs are unobservable (ie for which market data is unavailable) for the asset or liability.
The valuation techniques used by the Company are explained in the accounting policies note 2(e). The Company’s portfolio
consists wholly of quoted equities, all of which are Level 1.
The fair value of both the 2.51% Senior Loan Note and 4.37% Senior Loan Note have been calculated by aggregating the
expected future cash flows for the loans discounted at a rate based on UK gilts issued with comparable coupon rates and
maturity dates plus a margin representing the credit for Investment Grade A bonds (2022 – the fair value of the 4.37% Senior
Loan Notes have been calculated based on a comparable debt security). The fair value and amortised cost amounts can be
found in note 16.
All other financial assets and liabilities of the Company are included in the Statement of Financial Position at their book value
which in the opinion of the Directors is not materially different from their fair value.
88 Murray Income Trust PLC
20. Related party transactions and transactions with the Manager
Fees payable during the year to the Directors and their interests in shares of the Company are considered to be related party
transactions and are disclosed within the Directors’ Remuneration section of the Directors’ Remuneration Report on pages
47 to 50.
The Company has agreements with the Manager for the provision of management, secretarial, accounting and administration
services and promotional activities. Details of transactions during the year and balances outstanding at the year end are
disclosed in notes 4 and 5.
21. Capital management policies and procedures
The investment objective of the Company is to achieve a high and growing income combined with capital growth through
investment in a portfolio principally of UK equities.
The capital of the Company consists of debt (comprising loan notes and bank loans) and equity (comprising issued capital,
reserves and retained earnings). The Company manages its capital to ensure that it will be able to continue as a going concern
while maximising the return to shareholders through the optimisation of the debt and equity balance.
The Board monitors and reviews the broad structure of the Company’s capital on an ongoing basis. This review includes:
– the level of equity shares in issue;
– the planned level of gearing which takes into account the Investment Manager’s views on the market (net gearing figures
can be found on page 104); and
– the extent to which revenue in excess of that which is required to be distributed should be retained.
The Company’s objectives, policies and processes for managing capital are unchanged from the preceding accounting year.
Notes 13 and 14 give details of the Company’s bank facility agreement and loan notes respectively.
Notes to the Financial Statements
Continued
Murray Income Trust PLC 89
Corporate Information
Owned partly by SSE, a portfolio company, the Clyde Wind Farm in South
Lanarkshire has 206 turbines with an installed capacity of 522MW generating
sufficient renewable energy to power over 290,000 homes. SSE operates a
leading community investment programme, delivering financial support to a
diverse range of community projects near to its renewable developments,
with the Clyde Wind Farm community investment fund valued at £58m.
90 Murray Income Trust PLC
abrdn Fund Managers Limited
The Company’s Manager is abrdn Fund Managers
Limited, a subsidiary of abrdn, whose assets under
management and administration were £496 billion as at
30 June 2023.
The Investment Team
Charles Luke
Senior Investment Director
BA in Economics and Japanese Studies from Leeds
University and an MSc in Economic History from the
London School of Economics. Joined abrdn’s Pan
European equities team in 2000. He previously worked at
Framlington Investment Management.
Rhona Millar
Investment Manager
An Investment Analyst in the Developed Equities team
since 2018, Rhona joined abrdn in 2016 after working at EY.
Rhona graduated with a BSc in Mathematics from the
University of St Andrews. She is a chartered accountant
and a CFA Charterholder.
Iain Pyle
Investment Director
Investment Director in the UK equities team, having joined
abrdn in 2015. Prior to joining, he was an analyst on the
top-ranked Oil & Gas research team at Sanford Bernstein.
Iain graduated with a MEng degree in Chemical
Engineering from Imperial College and an
MSc (Hons) in Operational Research from Warwick
Business School. He is a chartered accountant and
a CFA Charterholder.
Information about the Manager including
Investment Process
Murray Income Trust PLC 91
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The Investment Process
Investment Philosophy and Style
The Investment Manager believes that company
fundamentals ultimately drive stock prices but are often
priced inefficiently. It believes that in-depth company
research delivers insights that can be used to exploit these
market inefficiencies. It focuses on investing in high quality
companies, with the market often underestimating the
sustainability of their returns. Quality companies tend to
produce more resilient earnings streams with fewer tail
risks, allowing them to better navigate challenging market
conditions whilst also capitalising on opportunities to
create value. This makes the approach well suited to
identifying companies with sustainable and growing
income generation. Investment insights are generated by
the extensive equity research platform at abrdn. Ideas are
generated through frequent direct company contact,
deep fundamental analysis and integrated ESG analysis
with rigorous team debate strengthening analytical
conclusions. The Investment Manager has a long-term
approach, aiming to buy and hold companies for a multi-
year time horizon although it has the ability to react
quickly if necessary. It is willing to take sizeable deviations
to the benchmark based on the companies where it finds
the highest quality and most attractive valuations.
Investment Process
The investment process has three stages:
1. Idea Generation and Research. Comprehensive
coverage of the UK equity market with a team of
analysts generating investment ideas from company
meetings, combined with corroborating evidence
from competitors, suppliers and customers.
External secondary research is also generated
to gain insight on the consensus view and
supplement proprietary research.
2. Stock Selection. Buy ideas are peer reviewed by the
UK and European equity team, evaluating the level of
conviction and the materiality, corroboration and
correlation of those investment opportunities. For the
Company specifically, the Investment Manager aims
to select high quality stocks. Quality is defined by
reference to management, business focus, balance
sheet and corporate governance.
3. Portfolio Construction and Risk Management. Portfolio
construction is undertaken in a disciplined way,
prioritising the taking of company specific risk with a
rigorous sell discipline. Non-proprietary and
proprietary quantitative tools are used to identify and
control risk factor exposures, including sector and
geographic weights
The Investment Manager believes that good investment
decision making requires clarity of responsibility for those
decisions. Every stock has a named analyst responsible for
its coverage, and every portfolio has a named fund
manager responsible for its management. The individual
portfolio managers make those decisions supported and
challenged by the team, but accountability for the final
decision is clear.
ESG integration means identifying and including all ESG
analysis in each investment decision and the Investment
Manager is regarded as a leader in this area. A central
ESG team supports investment teams across different
asset classes with its thematic work on areas such as
remuneration and climate change, as well as taking
responsibility for voting policies. Further information on
ESG may be found on pages 93 to 97.
The investment process also leverages a wealth of
knowledge, insight and expertise across asset classes and
regions within abrdn. This allows the Investment Manager
to take advantage of equity colleagues across the globe
who are meeting companies and conducting research
and sharing their insights using one common global
research platform. This is invaluable when investing in the
UK equity market, which is one of the most global markets
in the world. Corporate level insights are shared with the
credit team which enriches the equity view through an
understanding of the full capital structure of the
businesses invested in. Members of the Investment
Manager’s multi-asset and economics teams regularly
attend the equity team’s daily meeting to share macro
level insights.
92 Murray Income Trust PLC
Risk Management
The Investment Manager utilises a number of quantitative
risk tools to ensure it is fully aware of and understand all
the risks prevalent in portfolios it manages. These risk
management systems monitor and analyse active risk, the
composition of portfolio positions, as well as contribution
to risk and marginal contribution to risk of the portfolio’s
holdings. The systems break down the risk within the
portfolio by industry and country factors, and highlight the
stocks with the highest marginal contribution to risk and
the largest diversification benefit. Sector, thematic and
geographical positions are a residual of stock selection
decisions, but are monitored to ensure excessive risk is not
taken in any one area. The Investment Manager also
makes use of pre-trade analytics to assess the impact of
any trades on the portfolio risk metrics.
Accountability and Performance Evaluated at Each Stage of the Process
Information about the Manager including
Investment Process
Continued
Murray Income Trust PLC 93
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Summary
Some key information is set out below about the way ESG considerations have been embedded in the
portfolio by the Investment Manager.
abrdn
c. 60
Dedicated ESG
experts across
our business
5-star
Rating across nine
categories in the
latest Principles for
Responsible
Investment (PRI)
assessment
1,020
Company
engagements
covering ESG topics
Equities Investment Team
5-star/4 star
PRI Rating for
Integration/Active
Ownership in
Listed Equities
100%
of researched
companies include
integration of ESG
company analysis
Company
21.7%
Lower carbon
intensity relative
to the Benchmark
58
Number of
meetings where
the Company
voted
20.7%
Number of
meetings with at
least one vote
against
management
1
st
Quartile
Peer Group MSCI
Rating
AA
Fund MSCI ESG
Rating
abrdn’s latest PRI Assessment Report containing its scores across all modules is available at www.abrdn.com/en-gb/intermediary.
Engagement: time period referenced is the six months ended 30 June 2023.
Voting: time period referenced is the year ended 30 June 2023.
How the Investment Mana
g
er approaches ESG
94 Murray Income Trust PLC
Introduction
The Board relies on its Investment Manager to apply
appropriate Environment, Social and Governance (“ESG”)
principles to how the portfolio is constructed and
managed within the confines of its investment objective
and policy. Having an income objective means that the
Company needs to acquire investments which typically
provide a higher than average yield. In some cases, this
means more exposure to older industries such as mining
and oil and gas but, nevertheless the Investment
Manager’s ESG principles are applied in deciding on a
specific investment. Even within these more mature
industries it is evident that the possibility of engagement
by the Investment Manager can lead to change, for
example business models adapting to account for social
and environmental responsibilities. This is irrespective of
government interventions.
Although ESG factors are not the overriding criteria in
relation to the investment decisions taken by the
Investment Manager as the Company does not follow a
sustainability approach, prominence is placed on ESG
and climate-related factors throughout the
investment process.
The following explains how ESG and climate change
factors are considered by the Investment Manager.
The Investment Manager does not judge the suitability of
an investment from an ESG perspective on a purely binary
basis. Instead, a dynamic approach is taken, investing in
companies where the greatest alignment to mitigating
the risks can be seen or pursued further through the
investee companies’ commitment to improving their ESG
profile. The Investment Manager believes in active
engagement with our investments and potential
investments: from providing initial guidance on suitable
metrics through to holding the company to account for
delivering on its promises. It is through this filter that the
Investment Manager is comfortable investing in, for
example, sectors such as mining and oil and gas, subject
to the belief, based on such engagement and investee
companies delivering on their commitments, that a
company is taking the necessary action to address their
energy transition. The Investment Manager has high
expectations for these companies’ commitments to ESG
given that many commodities are necessary for the
transition to a low carbon future.
At the investment stage, ESG factors and analysis can help
to frame where best to invest by considering material risks
and opportunities alongside other financial metrics. Due
diligence can ascertain whether such risks are being
adequately managed, and whether the market has
understood and priced them accordingly.
The Investment Manager is an active investor, voting at
shareholder meetings in a considered manner, working
with companies to drive positive change, and engaging
with policymakers on ESG and stewardship matters.
How the Investment Mana
g
er approaches ESG
Continued
Murray Income Trust PLC 95
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
There are three core principles which underpin the Investment Manager’s investment approach (shown below) and the time
it dedicates to ESG analysis as part of its overall fundamental equity research process:
How the Investment Manager embeds ESG into its Investment Process
1. Investment Insight 2. Active Ownership 3. Risk & Monitoring 4. Our People
High quality fundamental and
first hand research
Assessment of ESG for all
stocks under coverage
Engage and vote with aim of
improving financial resilience
and investment performance
Raise standards in companies
and industries we invest in,
and help drive industry
best practice
Combine in-house and
external scoring to inform view
Active tracking of portfolio
holdings against ESG objectives
Over 130 equity professionals,
and 60 central and on-desk
ESG specialists across
the world
96 Murray Income Trust PLC
Details of the proprietary ESG scoring system that the
Investment Manager uses within its investment process
can be found in the bi-annual Sustainability Investment
Report which is considered by the Board. The report
includes updates on the key data and sustainability ratings
for the Company’s portfolio and is made available on its
website at: murray-income.co.uk
Benchmarking: MSCI ESG Ratings
MSCI company ratings are provided by MSCI to enable
comparisons with investments held elsewhere in a
standardised format. As described above, our Investment
Manager conducts its own proprietary research which
may lead it to a rating that differs to the MSCI score. MSCI
rates companies on a AAA-CCC scale according to their
exposure to ESG risks and how well they manage those
risks relative to peers.
The Company’s MSCI ESG Quality Score assesses the
resilience of a fund's aggregate holdings to long term ESG
risks and is provided on a 0-10 scale, with 10 being the
highest possible fund score. It is based on a granular
breakdown of a company’s business, its core product or
business segments, the locations of its assets or revenues
and other relevant measures such as outsourced
production. The Company’s MSCI ESG Quality Score is 8.3.
The MSCI ESG Rating measures the resiliency of portfolios
to long term risks and opportunities arising from
environmental, social, and governance factors. The ESG
Rating is calculated as a direct mapping of the "MSCI ESG
Quality Score" to letter rating categories.
The Company’s MSCI ESG Rating is
AA
Based on the Company’s holdings as at 30 June 2023
Climate Change
Climate change is one of the most significant challenges
of the 21st century and has big implications for investors.
The energy transition is underway in many parts of the
world, and policy changes, falling costs of renewable
energy, and a change in public perception are happening
at a rapid pace. The task force on climate-related
financial disclosures (referred to as “TCFD”) is now a
global standard for reporting climate risks and
opportunities. As a listed investment company, the
Company is not subject to the FCA Listing Rule
requirement to comply with TCFD reporting. However, the
Board is a keen supporter of the ambitions of TCFD, as it
believes it will improve disclosure of climate related risks.
This in turn will help the Investment Manager and other
stakeholders better assess the risks which will support
sound investment decisions. Your Manager is subject to
mandatory requirements to report on the Company as
one of its products and the first Murray Income Trust PLC
TCFD Report, for the year ended 31 December 2022, is
available from the Company’s website at murray-
income.co.uk.
Assessing the risks and opportunities of climate change is
already an integral part of the investment process
associated with your portfolio. In particular, the Investment
Manager considers:
Transition risks and opportunities
Governments could take robust climate change
mitigation actions to reduce emissions and transition to a
low-carbon economy. This is reflected in targets, policies
and regulation and can have a considerable impact on
high-emitting companies.
Physical risks and opportunities
Insufficient climate change mitigation action will lead to
more severe and frequent physical damage. This results in
financial implications, including damage to crops and
infrastructure, and the need for physical adaptation such
as flood defences.
The Investment Manager has aligned its approach with
that advocated by the investor agenda of the Principles
for Responsible Investment (PRI) – a United Nations-
supported initiative to promote responsible investment as
a way of enhancing returns and better managing risk.
Importance of Engagement
The Investment Manager is committed to regular, ongoing
engagement with the companies in which it invests, to
help to maintain and enhance their ESG standards into
the future.
As part of the investment process, the Investment
Manager undertakes a significant number of company
meetings each year on behalf of the Company, supported
by on-desk ESG analysts as well as a well-resourced
specialist ESG Investment team. These meetings provide
an opportunity to discuss various relevant ESG issues
including board composition, remuneration, audit, climate
change, labour issues, human rights, bribery and
corruption. Companies are strongly encouraged to set
clear targets or key performance indicators on all material
ESG risks.
Continued
How the Investment Mana
g
er approaches ESG
Murray Income Trust PLC 97
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
This engagement is not limited to a company’s
management team. It can include many other
stakeholders such as non-government agencies, industry
and regulatory bodies, as well as activists and the
company’s customers and clients.
Examples of engagement with companies including
Games Workshop, Safestore and Hiscox, during the year
ended 30 June 2023, may be found in the Investment
Manager’s Report, on page 12.
Our Engagement Activity
The following chart shows the engagements that have
included ESG topics. Over the year ended 30 June 2023,
the Investment Manager met with 36 portfolio companies
on ESG topics and held 71 engagements with them. This
does not include positions sold by the Investment
Manager, or potential stocks under consideration. Themes
engaged on include:
Climate
Environment
Labour Management,
Diversity & Inclusion
Human Rights &
Stakeholders
Corporate Behaviour
Corporate
Governance
abrdn’s Voting Activity
The following is a summary of the Investment Manager’s
voting activity, on behalf of the Company, for the year
ended 31 December 2022 (Source abrdn):
Voting Summary Total
How many meetings were you eligible to vote? 64
How many meetings did you vote at? 58
How many resolutions were you eligible to vote on? 1,203
What % of resolutions did you vote on for which
you were eligible?
89.4%
Of the resolutions on which you voted, what % did
you vote with management?
96.3%
Of the resolutions on which you voted, what % did
you vote against management?
3.6%
Of the resolutions on which you voted, what % did
you abstain from voting?
0.1%
In what % of meetings, for which you did vote, did
you vote at least once against management?
20.7%
While it is most common for the Investment Manager to vote in line with an investee board’s voting recommendation,
abrdn will vote against resolutions which are not consistent with the Company’s best interests. For example, abrdn may
vote against resolutions which are not aligned with its policies or which conflict with local governance guidelines, such as
the Investment Association in the UK. Although the Investment Manager seeks to vote either in favour or against a
resolution, it does make use of an abstain vote where this is considered appropriate. The Investment Manager aims
to vote at all eligible meetings unless share blocking (which can be a feature of voting in non UK jurisdictions) makes
this unviable.
98 Murray Income Trust PLC
Alternative Investment Fund Managers
Directive (“AIFMD”) and Pre-Investment
Disclosure Document (“PIDD”)
The Company has appointed the Manager as its
alternative investment fund manager and BNP Paribas
Trust Corporation UK Limited as its depositary
under the AIFMD.
The AIFMD requires the Manager, as the Company’s
alternative investment fund manager, to make available
to investors certain information prior to such investors’
investment in the Company. Details of the leverage and
risk policies which the Company is required to have in
place under AIFMD are published in the Company’s PIDD
which can be found on its website: murray-income.co.uk
The periodic disclosures required to be made by the
Manager under the AIFMD are set out on page 101.
Benchmark
The Company’s benchmark is the FTSE All-Share Index.
Keeping You Informed
For internet users, detailed data on the Company
(including price, performance information, a monthly fact
sheet and current and historic Annual and Half-Yearly
Reports) is available from the Company’s website
(murray-income.co.uk) and the TrustNet website
(trustnet.co.uk). Alternatively you can call 0808 500 0040
(free when dialling from a UK landline) for investment
company information. You can register for regular email
updates by visiting the Company’s website.
a
brdn Investment Trusts Social Media Accounts
Twitter: @abrdnTrusts
LinkedIn: abrdn Investment Trusts
Investor Warning: Be alert to share fraud
and boiler room scams
The Company has been made aware by abrdn that some
investors have received telephone calls from people
purporting to work for abrdn, or third parties, who have
offered to buy their investment trust shares. These may be
scams which attempt to gain personal information with
which to commit identity fraud or could be ‘boiler room’
scams where a payment from an investor is required to
release the supposed payment for their shares. These
callers do not work for abrdn and any third party making
such offers has no link with abrdn. abrdn never makes
these types of offers and does not ‘cold-call’ investors in
this way. If investors have any doubt over the veracity of a
caller, they should not offer any personal information, end
the call and contact abrdn’s investor services centre using
the details provided below.
The Financial Conduct Authority provides advice with
respect to share fraud and boiler room scams at:
fca.org.uk/consumers/scams
Shareholder Enquiries
For queries regarding shareholdings, lost certificates,
dividend payments, registered details and related
matters, shareholders holding their shares directly in the
Company are advised to contact the Registrar, Link Group
(see Additional Shareholder Information for details).
Changes of address must be notified to the Registrar
in writing.
Any general questions about the Company should be
addressed to the Company Secretaries, Murray Income
Trust PLC, 1 George Street, Edinburgh EH2 2LL or by email
to: murray-income@abrdn.com.
Suitable for Retail/NMPI Status
The Company’s shares are intended for investors,
primarily in the UK, including retail investors, professionally-
advised private clients and institutional investors who are
seeking a high and growing income combined with capital
growth through investment in a portfolio principally of UK
equities, and who understand and are willing to accept the
risks of exposure to equities.
Investors should consider consulting a financial adviser
who specialises in advising on the acquisition of shares
and other securities before acquiring shares. Investors
should be capable of evaluating the risks and merits of
such an investment and should have sufficient resources
to bear any loss that may result.
Investor Information
Murray Income Trust PLC 99
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The Company currently conducts its affairs so that the
securities issued by the Company can be recommended
by a financial adviser to ordinary retail investors in
accordance with the Financial Conduct Authority’s rules in
relation to non-mainstream pooled investments (“NMPIs”)
and intends to continue to do so for the foreseeable future.
The Company’s securities are excluded from the Financial
Conduct Authority’s restrictions which apply to NMPIs
because they are securities issued by an investment trust.
Key Information Document (“KID”)
The KID relating to the Company can be found under ‘Key
Documents’ in the ‘Literature’ section of the Company’s
website at murray-income.co.uk.
How to Attend and Vote at
Company Meetings
The Chair’s Statement, in “Action to be Taken” on page 7
includes information on how shareholders may exercise
their voting rights in relation to the Annual General
Meeting on 7 November 2023.
How to Invest in Murray Income Trust PLC
and other abrdn-managed investment trusts
A range of leading investment platforms and share
dealing services let you buy and sell abrdn-managed
investment trusts including Murray Income Trust PLC.
Many of these platforms operate on an ‘execution-only’
basis. This means they can carry out your instruction to
buy or sell a particular investment trust. But they may not
be able to advise on suitable investments for you. If you
require advice, please speak to a qualified financial
adviser (see below).
A note about the abrdn Investment Trusts
Savings Plans (the “Plans”)
In June 2023, abrdn notified existing investors in the abrdn
Investment Trusts ISA, Share Plan and Investment Plan for
Children that these Plans would be closing in December
2023. The Plans are no longer open to new investors.
Further information on the options available to investors in
the Plans may be found at: invtrusts.co.uk/planclosure
If you are an existing investor in the Plans and have any
queries, please contact our Investor Services department
on 0808 500 4000 or, from overseas, on 00 44 1268 448
222. We are open from 9am to 5pm, Monday to Friday,
Call charges will vary. Alternatively, please contact us by
email at inv.trusts@abrdn.com . Email is not a secure form
of communication so you should not send any personal or
sensitive information.
Flexibility
Many investment platform providers will allow you to buy
and hold abrdn Investment Trust shares within an
Individual Savings Account (ISA), Junior ISA or Self Invested
Personal Pension (SIPP), all of which have potential tax
advantages. Most will also allow you to invest on both a
lump sum and regular savings basis.
Costs and service
It is important to choose the right platform for your needs,
so take time to research what each platform offers before
you make your decision, as well as considering charges.
When it comes to charges, some platforms have flat fee
structures while others levy percentage-based charges.
Typically, you will also pay a fee every time you buy and
sell shares, so you need to bear in mind these transaction
costs if you are trading frequently. There may also be
additional charges for ISA and SIPP investments.
Can I exercise my voting rights if I hold my
shares through an investment platform?
Yes, you should be able to exercise your right to vote by
contacting your platform provider. Procedures differ, but
some platforms will automatically alert you when new
statutory documents are available and then allow you to
vote online. Others will require you to contact them to
vote. Your chosen platform provider will provide
further guidance.
Getting advice
abrdn recommends that you seek financial advice prior to
making an investment decision. If you do not currently
have a financial adviser, details of authorised financial
advisers in your area can be found at pimfa.co.uk or
unbiased.co.uk (see below). You will pay a fee for
advisory services.
100 Murray Income Trust PLC
Platform providers
Platforms featuring Murray Income Trust PLC, as well as
other abrdn-managed investment trusts, include:
· AJ Bell:
www.ajbell.co.uk/markets/investment-trusts
· Barclays Smart Investor:
www.barclays.co.uk/smart-investor
· Charles Stanley Direct:
www.charles-stanley-direct.co.uk
· Fidelity: www.fidelity.co.uk
· Halifax: www.halifax.co.uk/investing
· Hargreaves Lansdown:
www.hl.co.uk/shares/investment-trusts
· interactive investor (owned by abrdn):
www.ii.co.uk/investment-trusts
The companies above are shown for illustrative purposes
only. Other platform providers are available. The links
above direct you to external websites operated by each
platform provider. abrdn is not responsible for the content
and information on these third-party sites, apart from
interactive investor, which is owned by abrdn.
Discretionary Private Client Stockbrokers
If you have a large sum to invest, you may wish to contact
a discretionary private client stockbroker. They can
manage your entire portfolio of shares and will advise you
on your investments. To find a private client stockbroker
visit The Personal Investment Management & Financial
Advice Association at: pimfa.co.uk.
Financial Advisers
To find an adviser who recommends on investment trusts,
visit: unbiased.co.uk
Regulation of Stockbrokers
Before approaching a stockbroker, always check that
they are regulated by the Financial Conduct Authority:
Tel: 0800 111 6768 or at
at https://register.fca.org.uk
Email: consumerqueries@fca.org.uk
Note
Please remember that past performance is not a guide to the future. Stock market and currency movements may
cause the value of shares and the income from them to fall as well as rise and investors may not get back the amount
they originally invested. As with all equity investments, the value of investment trusts purchased will immediately be
reduced by the difference between the buying and selling prices of the shares, the market maker’s spread. Investors
should further bear in mind that the value of any tax relief will depend on the individual circumstances of the investor and
that tax rates and reliefs, as well as the tax treatment of ISAs, may be changed by future legislation.
The information on pages 98 to 100 has been approved for the purposes of Section 21 of the Financial Services and
Markets Act 2000 (as amended by the Financial Services Act 2012) by abrdn Investments Limited, 280 Bishopsgate,
London EC2M 4AG which is authorised and regulated by the Financial Conduct Authority in the United Kingdom.
Financial Calendar
Payment months of quarterly dividends
March, June, September, December
Financial year end
30 June
Expected announcement of annual results
September
Annual General Meeting
November
Investor Information
Continued
Murray Income Trust PLC 101
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
The Manager and the Company are required to make certain disclosures available to investors in accordance
with the AIFMD. Those disclosures that are required to be made pre-investment are included within a pre-investment
disclosure document (“PIDD”) which may be found on the Company’s website (murray-income.co.uk), maintained
by the Manager.
AIFMD or the Directive
The Alternative Investment Fund Managers Directive -
There have been no material changes to the disclosures contained within the PIDD since its latest publication
in September 2023.
The periodic disclosures as required under the AIFMD to investors are made below:
· information on the investment strategy, geographic and sector investment focus and principal stock exposures is
included in the Strategic Report;
· none of the Company’s assets are subject to special arrangements arising from their illiquid nature;
· the Strategic Report, Note 18 to the financial statements and the PIDD, together set out the risk profile and risk
management systems in place. There have been no changes to the risk management systems in place in the period
under review and no breaches of any of the risk limits set, with no breach expected;
· there are no new arrangements for managing the liquidity of the Company or any material changes to the liquidity
management systems and procedures employed by the Manager;
· all authorised Alternative Investment Fund Managers are required to comply with the AIFMD Remuneration Code. In
accordance with the AIFMD Remuneration Code, the AIFM’s remuneration policy in respect of its reporting period
ended 31 December 2022 is available on the website of abrdn plc at www.abrdn.com/en-gb/corporate/about-us/our-
leadership-team/remuneration-disclosure, or on request from the Company Secretaries, abrdn Holdings Limited (see
Additional Shareholder Information on page 113 for contact details).
Leverage
For the purposes of the Alternative Investment Fund Managers Directive, leverage is any method which increases the
Company’s exposure, including the borrowing of cash and the use of derivatives. It is expressed as a ratio between the
Company’s exposure and its net asset value and can be calculated on a gross and a commitment method. Under the
gross method, exposure represents the sum of the Company’s positions after the deduction of Sterling cash balances,
without taking into account any hedging and netting arrangements. Under the commitment method, exposure is
calculated without the deduction of Sterling cash balances and after certain hedging and netting positions are offset
against each other.
The table below sets out the current maximum permitted limit and actual level of leverage for the Company:
Gross Method Commitment Method
Maximum level of leverage 2.50:1 2.00:1
Actual level at 30 June 2023 1.21:1 1.23:1
There have been no breaches of the maximum level during the period and no changes to the maximum level of
leverage employed by the Company. There is no right of re-use of collateral or any guarantees granted under the
leveraging arrangement. Changes to the information contained either within this Annual Report or the PIDD in relation to
any special arrangements in place, the maximum level of leverage which the AIFM may employ on behalf of the
Company; the right of use of collateral or any guarantee granted under any leveraging arrangement; or any change to
the position in relation to any discharge of liability by the Depositary will be notified via a regulatory news service without
undue delay in accordance with the AIFMD.
The information on this page has been approved for the purposes of Section 21 of the Financial Services and Markets Act
2000 (as amended by the Financial Services Act 2012) by the Manager which is authorised and regulated by the
Financial Conduct Authority in the United Kingdom.
AIFMD Disclosures
(
Unaudited
)
102 Murray Income Trust PLC
General
Safestore, a portfolio company, is the UK's largest self-storage group with 181
stores, comprising 130 stores in the UK (including 72 in London and the South
East with the remainder in key metropolitan areas such as Manchester,
Birmingham, Glasgow, Edinburgh, Liverpool and Bristol), 29 stores in the Paris
region, as well as 22 in Belgium, Spain and the Netherlands. The Manager’s
engagement with the company is described on page 12.
Murray Income Trust PLC 103
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Alternative performance measures are numerical measures of the Company’s current, historical or future performance, financial
position or cash flows, other than financial measures defined or specified in the applicable financial framework. The Company’s
applicable financial framework includes FRS 102 and the AIC SORP. The Directors assess the Company’s performance against a range
of criteria which are viewed as particularly relevant for closed-end investment companies.
Discount to net asset value per Ordinary share with debt at fair value
The discount is the amount by which the share price is lower than the net asset value per share with debt at fair value, expressed as a
percentage of the net asset value.
2023 2022
NAV per Ordinary share a 911.7p 871.0p
Share price b 837.0p 832.0p
Discount (b-a)/a –8.2% –4.5%
Discount to net asset value per Ordinary share with debt at par value
The discount is the amount by which the share price is lower than the net asset value per share with debt at par value, expressed as a
percentage of the net asset value.
2023 2022
NAV per Ordinary share a 894.4p 864.9p
Share price b 837.0p 832.0p
Discount (b-a)/a –6.4% –3.8%
Dividend cover
Dividend cover is the revenue return per share divided by dividends per share expressed as a ratio.
2023 2022
Revenue return per share a 38.73p 40.50p
Dividends per share b 37.50p 36.00p
Dividend cover a/b 1.03 1.13
Alternative Performance Measures
104 Murray Income Trust PLC
Alternative Performance Measures
Continued
Dividend yield
The annual dividend per Ordinary share divided by the share price, expressed as a percentage.
2023 2022
Dividends per share a 37.50p 36.00p
Share price b 837.00p 832.00p
Dividend yield a/b 4.5% 4.3%
Net asset value per Ordinary share with debt at fair value
The calculation of the Company’s net asset value per Ordinary share with debt at fair value is set out in note 16.
Net gearing
Net gearing measures the total borrowings less cash and cash equivalents divided by shareholders’ funds, expressed as a percentage.
Under AIC reporting guidance cash and cash equivalents includes amounts due to and from brokers at the year end as well as cash
and cash equivalents.
2023 2022
Bank loans (£’000) a (6,378) (6,507)
Senior Loan Notes (£’000) b (109,141) (110,710)
Total borrowings (£’000) c=a+b (115,519) (117,217)
Cash (£’000) d 15,115 20,131
Amounts due to brokers (£’000) e (3,449) –
Amounts due from brokers (£’000) f – 2,490
Shareholders’ funds (£’000) g 999,184 1,009,255
Net gearing –(c+d+e+f)/g 10.4% 9.4%
Murray Income Trust PLC 105
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Ongoing charges ratio
The ongoing charges ratio has been calculated based on the total of investment management fees and administrative expenses less
non-recurring charges and expressed as a percentage of the average daily net asset values with debt at fair value published
throughout the year.
2023 2022
Investment management fees (£’000) a 3,804 3,997
Administrative expenses (£’000) b 1,390 1,350
Less: non-recurring charges
A
(£’000) c (8) (30)
Ongoing charges (£’000) a+b+c 5,186 5,317
Average net assets (£’000) d 1,036,020 1,102,862
Ongoing charges ratio e=(a+b+c)/d 0.50% 0.48%
A
2023 comprises £7,000 professional fees relating to discussions with the registrar and £1,000 quick turnaround fee on ESEF filing. 2022 comprises £20,000 director recruitment fee,
£8,000 legal fees relating to the private placement notes and £2,000 professional fees for Taiwan tax work.
The ongoing charges ratio provided in the Company’s Key Information Document is calculated in line with the PRIIPs regulations, which
includes financing and transaction costs.
Total return
Share price and NAV total returns show how the NAV and share price has performed over a period of time in percentage terms, taking
into account both capital returns and dividends paid to shareholders. Share price and NAV total returns are monitored against open-
ended and closed-ended competitors, and the FTSE All-Share Index, respectively.
Share NAV NAV
Year ended 30 June 2023 Price (debt at fair value) (debt at par)
Opening at 1 July 2022 a 832.0p 871.0p 864.9p
Closing at 30 June 2023 b 837.0p 911.7p 894.4p
Price movements c=(b/a)-1 0.6% 4.7% 3.4%
Dividend reinvestment
A
d 4.3% 4.1% 4.1%
Total return c+d 4.9% 8.8% 7.5%
106 Murray Income Trust PLC
Alternative Performance Measures
Continued
Share NAV NAV
Year ended 30 June 2022 Price (debt at fair value) (debt at par)
Opening at 1 July 2021 a 871.0p 935.7p 934.6p
Closing at 30 June 2022 b 832.0p 871.0p 864.9p
Price movements c=(b/a)-1 –4.5% –6.9% –7.5%
Dividend reinvestment
A
d 3.8% 3.4% 3.5%
Total return c+d –0.7% –3.5% –4.0%
A
Share price total return involves reinvesting the net dividend in the share price of the Company on the date on which that dividend goes ex-dividend. NAV total return involves
investing the net dividend in the NAV of the Company with debt at fair value on the date on which that dividend goes ex-dividend.
Murray Income Trust PLC 107
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
Active Share
A measure of the difference between a portfolio and a
benchmark, calculated as a percentage
abrdn or the Group
The abrdn plc group of companies.
AIFMD
Alternative Investment Fund Managers Directive
AIC
The Association of Investment Companies (theaic.co.uk).
Benchmark
FTSE All-Share Index.
Depositary
A depositary is responsible for cash monitoring, the
custody and safeguarding of the Company’s financial
instruments and monitoring the Company’s compliance
with investment limits and leverage requirements. During
the year the Depositary was BNP Paribas Trust
Corporation UK Limited.
FCA
The Financial Conduct Authority.
Investment Manager
abrdn Investments Limited (formerly Aberdeen Asset
Managers Limited, until 25 November 2022).
Investment Trust
A type of Closed-End Fund which invests in other
securities, allowing shareholders to share the risks, and
returns, of collective investment.
Key Information Document or KID
The Packaged Retail and Insurance-based Investment
Products (“PRIIPS”) Regulation requires the Manager, as
the Company’s PRIIP ‘manufacturer’, to prepare a Key
Information Document (“KID”) in respect of the Company.
This KID must be made available by the Manager to retail
investors prior to them making any investment decision
and is available via the Company’s website. The Company
is not responsible for the information contained in the KID
and investors should note that the procedures for
calculating the risks, costs and potential returns are
prescribed by law. The figures in the KID may not reflect
the expected returns for the Company and performance
returns cannot be guaranteed.
Manager (the “Manager”)
abrdn Fund Managers Limited (formerly Aberdeen
Standard Fund Managers Limited, until 31 July 2022), is a
wholly owned subsidiary of abrdn and acts as the
alternative investment fund manager for the Company.
abrdn Fund Managers Limited is authorised and regulated
by the Financial Conduct Authority.
Net Asset Value or NAV
The net asset value or NAV is the Company’s total assets
less liabilities. Liabilities for this purpose include current and
long-term liabilities such as the Company’s £40m senior
loan notes expiring in 2027 and £60m senior loan notes
expiring in 2029.
NAV per Ordinary Share
The calculation of the NAV per Ordinary share is shown in
note 16 on the basis of debt at par value (amortised cost)
and debt at fair value (discounted cashflow basis, as set
out in note 19).
Price/Earnings Ratio
The ratio is calculated by dividing the middle-market price
per share by the earnings per share. The calculation
assumes no change in earnings but in practice the
multiple reflects the stock market’s view of a company’s
prospects and profit growth potential.
PRIIPs
Packaged retail and insurance-based investment
products marketed to retail investors which are subject to
investment risk
Scrip Dividend
An issue of shares to a shareholder in proportion to their
existing holding, in lieu of paying a dividend.
Glossary of Terms
108 Murray Income Trust PLC
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Murray Income Trust PLC will be held at 12.30pm on
Tuesday 7 November 2023 in the Strathclyde Suite, The Glasgow Royal Concert Hall, 2 Sauchiehall Street, Glasgow,
G2 3NY for the purpose of considering and if thought fit passing the following resolutions, of which Resolutions 1 to 11
inclusive will be proposed as Ordinary Resolutions and Resolutions 12 and 13 inclusive will be proposed as
Special Resolutions:–
Ordinary Business
1. To receive and adopt the Directors’ Report, Auditor’s Report and the audited financial statements for the year ended
30 June 2023.
2. To receive and adopt the Directors’ Remuneration Report for the year ended 30 June 2023 other than the Directors’
Remuneration Policy.
3. To receive and adopt the Directors’ Remuneration Policy as set out on pages 47 and 48 of the Annual Report of the
Company for the year ended 30 June 2023.
4. To approve the Company’s dividend policy to pay four quarterly interim dividends per year.
5. To re-elect Stephanie Eastment* as a Director of the Company.
6. To re-elect Alan Giles* as a Director of the Company.
7. To re-elect Nandita Sahgal Tully* as a Director of the Company.
8. To re-elect Peter Tait* as a Director of the Company.
9. To re-appoint PricewaterhouseCoopers LLP as independent auditor of the Company.
10. To authorise the Audit Committee to fix the remuneration of PricewaterhouseCoopers LLP as independent auditor
of the Company for the year ended 30 June 2024.
Special Business
Authority to Allot
11. THAT, in substitution of all existing powers, the Directors be and are hereby generally and unconditionally authorised
in accordance with Section 551 of the Companies Act 2006 (the “Act”) to exercise all the powers of the Company to
allot Ordinary shares of 25p each in the capital of the Company (“shares”) up to an aggregate nominal amount of
£1,374,150 (or, if less, the number representing 5 per cent. of the total Ordinary shares in issue (excluding treasury
shares) as at the date of passing of this resolution), during the period expiring on the conclusion of the next Annual
General Meeting of the Company after the passing of this resolution or on 31 December 2024, whichever is the
earlier, but so that this authority shall allow the Company to make offers or agreements before the expiry of this
authority which would or might require shares to be allotted after such expiry and the Directors shall be entitled to
allot shares in pursuance of such an offer or agreement as if such authority had not expired.
Disapplication of Pre-emption Rights
12. THAT, subject to the passing of Resolution 11 proposed at the Annual General Meeting of the Company convened
for 7 November 2023, and in substitution for all existing powers, the Directors be and are hereby empowered,
pursuant to Section 570 of the Companies Act 2006 (the “Act”), to allot equity securities (as defined in Section 560(1)
of the Act) for cash pursuant to the authority given in accordance with Section 551 of the Act by Resolution 11 or
otherwise as if Section 561 of the Act did not apply to any such allotment and to sell or transfer equity securities if,
immediately before the sale or transfer, such equity securities are held by the Company as treasury shares (as
defined in Section 724(5) of the Act) as if Section 561 of the Act did not apply to any such sale or transfer, provided
that this power:-
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Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
i. expires at the conclusion of the next Annual General Meeting of the Company after the passing of this resolution
or on 31 December 2024, whichever is the earlier, but so that this power shall enable the Company to make
offers or agreements which would or might require equity securities to be allotted or treasury shares to be sold
or transferred after the expiry of this power and the Directors may allot equity securities or sell or transfer
treasury shares in pursuance of any such offers or agreements as if this power had not expired;
ii. shall be limited to the allotment of equity securities up to an aggregate nominal amount of £2,748,300 (or, if less,
the number representing 10 per cent. of the total Ordinary shares in issue (excluding treasury shares) as at the
date of passing of this resolution); and
iii. shall be limited in respect of the issue of shares or the sale of equity securities from treasury in the
circumstances as detailed in the section headed “Authority to allot shares and disapply pre-emption rights” in
the Directors’ Report on page 44 of the Annual Report of the Company for the year ended 30 June 2023 and at a
price not less than 0.5% above the net asset value per share (as determined by the Directors).
Authority to Make Market Purchases of Shares
13. THAT the Company be and is hereby generally and, subject as hereinafter appears, unconditionally authorised in
accordance with Section 701 of the Companies Act 2006 (the “Act”) to make market purchases (within the meaning
of Section 693(4) of the Act) of Ordinary shares of 25p each in the capital of the Company (“shares”) and to cancel
or hold in treasury such shares, provided always that:
i. the maximum number of shares hereby authorised to be purchased shall be an aggregate of 16,478,806
Ordinary shares or, if less, the number representing 14.99% of the total Ordinary shares in issue (excluding
treasury shares) as at the date of passing this resolution;
ii. the minimum price which may be paid for each share shall be 25p;
iii. the maximum price (exclusive of expenses) which may be paid for a share is the higher of (i) 5% above the
average of the middle market quotations for a share taken from, and calculated by reference to, the London
Stock Exchange Daily Official List for the five business days immediately preceding the day on which the share is
purchased; and (ii) the higher of the price of the last independent trade and the highest current independent bid
on the London Stock Exchange at the time the purchase is carried out;
iv. the authority hereby conferred shall expire on 31 December 2024 or, if earlier, at the conclusion of the next
Annual General Meeting of the Company unless such authority is previously varied, revoked or renewed prior to
such time; and
v. the Company may enter into a contract to purchase shares under the authority hereby conferred prior to the
expiry of such authority and may purchase shares pursuant to any such contract notwithstanding such
expiry above.
*The biographies of the Directors offering themselves for re-election may be found on pages 34 to 36.
By order of the Board
abrdn Holdings Limited
Secretaries
19 September 2023
Registered Office
1 George Street
Edinburgh
EH2 2LL
110 Murray Income Trust PLC
Notes
i. To be entitled to attend and vote at the Meeting (and for the purpose of the determination by the Company of the
number of votes they may cast), shareholders must be registered in the Register of Members of the Company at
close of trading on 3 November 2023. Changes to the Register of Members after the relevant deadline shall be
disregarded in determining the rights of any person to attend and vote at the Meeting.
ii. Shareholders, or their proxies, intending to attend the Meeting in person are requested, if possible, to arrive at the
Meeting venue at least 20 minutes prior to the commencement of the Meeting at 12.30pm (UK time) on 7
November 2023 so that their shareholding may be checked against the Company’s Register of Members and
attendances recorded.
iii. Shareholders are entitled to appoint another person as a proxy to exercise all or part of their rights to attend and to
speak and vote on their behalf at the Meeting. A shareholder may appoint more than one proxy in relation to the
Meeting provided that each proxy is appointed to exercise the rights attached to a different ordinary share or
ordinary shares held by that shareholder. A proxy need not be a shareholder of the Company.
iv. In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the
appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in which
the names of the joint holders appear in the Company’s Register of Members in respect of the joint holding (the first
named being the most senior).
v. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes for or
against the resolution. If no voting indication is given, your proxy will vote or abstain from voting at his or her
discretion. Your proxy will vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is
put before the Meeting.
vi. You can vote either:
· by logging on to signalshares.com and following the instructions; or
· you may request a hard copy form of proxy directly from the registrars, Link Group, on Tel: 0371 664 0300. Calls
are charged at the standard geographic rate and will vary by provider. Calls from outside the UK will be charged
at the applicable international rate. Lines are open between 08:30 – 17:30, Monday to Friday excluding public
holidays in England and Wales.
· in the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with
the procedures set out below.
In order for a proxy appointment to be valid a form of proxy must be completed. In each case the form of proxy
must be received by Link Group at PXS 1, Central Square, 29 Wellington Street, Leeds, LS1 4DL by 12.30pm on
3 November 2023.
vii. If you return more than one proxy appointment, either by paper or electronic communication, the appointment
received last by the Registrar before the latest time for the receipt of proxies will take precedence. You are advised
to read the terms and conditions of use carefully. Electronic communication facilities are open to all shareholders
and those who use them will not be disadvantaged.
viii. The return of a completed form of proxy, electronic filing or any CREST Proxy Instruction (as described in note (x)
below) will not prevent a shareholder from attending the Meeting and voting in person if he/she wishes to do so.
ix. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service
may do so for the Meeting (and any adjournment of the Meeting) by using the procedures described in the CREST
Manual (available from euroclear.com/site/public/EUI ). CREST Personal Members or other CREST sponsored
members, and those CREST members who have appointed a service provider(s), should refer to their CREST
sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf.
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Continued
Murray Income Trust PLC 111
Strategic Report Governance Overview General Portfolio Corporate Information Financial Statements
x. In order for a proxy appointment or instruction made by means of CREST to be valid, the appropriate CREST
message (a ‘CREST Proxy Instruction’) must be properly authenticated in accordance with Euroclear UK & Ireland
Limited’s specifications and must contain the information required for such instructions, as described in the CREST
Manual. The message must be transmitted so as to be received by the issuer’s agent (ID RA10) by 12.30pm on 3
November 2023. For this purpose, the time of receipt will be taken to mean the time (as determined by the
timestamp applied to the message by the CREST application host) from which the issuer’s agent is able to retrieve
the message by enquiry to CREST in the manner prescribed by CREST. After this time, any change of instructions to
proxies appointed through CREST should be communicated to the appointee through other means.
xi. CREST members and, where applicable, their CREST sponsors or voting service providers should note that
Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular message.
Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is
the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member,
or sponsored member, or has appointed a voting service provider(s), to procure that his CREST sponsor or voting
service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of
the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST
sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning
practical limitations of the CREST system and timings. The Company may treat as invalid a CREST Proxy Instruction
in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.
xii. Any corporation which is a shareholder can appoint one or more corporate representatives who may exercise on
its behalf all of its powers as a shareholder provided that no more than one corporate representative exercises
powers in relation to the same shares.
xiii. As at 19 September 2023 (being the latest practicable business day prior to the publication of this Notice), the
Company’s ordinary issued share capital consists of 109,932,001 ordinary shares, carrying one vote each and
9,597,531 shares held in treasury. Therefore, the total voting rights in the Company as at 19 September 2023 are
109,932,001.
xiv. Under Section 527 of the Companies Act 2006, shareholders meeting the threshold requirements set out in that
section have the right to require the Company to publish on a website a statement setting out any matter relating
to: (i) the audit of the Company’s financial statements (including the Auditor’s Report and the conduct of the audit)
that are to be laid before the Meeting; or (ii) any circumstances connected with an auditor of the Company
ceasing to hold office since the previous meeting at which annual financial statements and reports were laid in
accordance with Section 437 of the Companies Act 2006 (in each case) that the shareholders propose to raise at
the relevant meeting. The Company may not require the shareholders requesting any such website publication to
pay its expenses in complying with Sections 527 or 528 of the Companies Act 2006. Where the Company is
required to place a statement on a website under Section 527 of the Companies Act 2006, it must forward the
statement to the Company’s auditor not later than the time when it makes the statement available on the website.
The business which may be dealt with at the Meeting for the relevant financial year includes any statement that the
Company has been required under Section 527 of the Companies Act 2006 to publish on a website.
xv. Any shareholder attending the Meeting has the right to ask questions. The Company must cause to be answered
any such question relating to the business being dealt with at the Meeting but no such answer need be given if: (a)
to do so would interfere unduly with the preparation for the Meeting or involve the disclosure of confidential
information; (b) the answer has already been given on a website in the form of an answer to a question; or (c) it is
undesirable in the interests of the Company or the good order of the Meeting that the question be answered.
xvi. Copies of the Directors’ letters of appointment will be available for inspection during normal business hours at the
registered office of the Company on any business day from the date of this Notice until the time of the Meeting and
may also be inspected at the Meeting venue, as specified in this Notice, for 15 minutes before and during the
Annual General Meeting until the conclusion of the Meeting.
112 Murray Income Trust PLC
xvii. You may not use any electronic address (within the meaning of Section 333(4) of the Companies Act 2006)
provided in either this Notice or any related documents (including the form of proxy) to communicate with the
Company for any purposes other than those expressly stated.
xviii. A copy of this Notice, and other information required by Section 311A of the Companies Act 2006, can be found on
the Company’s website at murray-income.co.uk
xix. There are special arrangements for holders of shares through the abrdn Investment Plan for Children, Investment
Trust Share Plan and Investment Trust Individual Savings Account (“ISA”). These are explained in the separate
‘Letter of Direction’ which such holders will have received with this Annual Report.
xx. If the law or Government guidance so requires at the time of the Meeting, physical attendance at the Meeting may
not be possible. In these circumstances, the Chair will limit, in their sole discretion, the number of individuals in
physical attendance at the meeting to two persons. Should there be no restrictions imposed by law or Government
at the time of the Meeting, the Company may still impose entry restrictions on certain persons wishing to attend the
Meeting in order to ensure the safety of those attending the Meeting. As set out in the Chair’s Statement,
shareholders are encouraged to submit questions in advance of the Meeting by email to:
murray.income@abrdn.com
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the action you should take, you are
recommended to seek your own independent financial advice from your stockbroker, bank manager, solicitor, accountant or other independent financial
adviser authorised under the Financial Services and Markets Act 2000 (as amended by the Financial Services Act 2012) if you are in the United Kingdom or,
if not, from another appropriately authorised financial adviser.
If you have sold or otherwise transferred all your Ordinary shares in Murray Income Trust PLC, please forward this document together with the
accompanying documents immediately to the purchaser or transferee, or to the stockbroker, bank or agent through whom the sale or transfer was
effected for transmission to the purchaser or transferee.
Notice of Annual General Meetin
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Murray Income Trust PLC 113
Directors
Neil Rogan (Chair)
Peter Tait (Senior Independent Director)
Stephanie Eastment (Audit Committee Chair)
Alan Giles
Merryn Somerset Webb
Nandita Sahgal Tully
Company Secretaries, Registered Office and
Company Number
abrdn Holdings Limited
(formerly Aberdeen Asset Management PLC)
1 George Street
Edinburgh EH2 2LL
Registered in Scotland under company number SC012725
Website
murray-income.co.uk
Legal Entity Identifier
549300IRNFGVQIQHUI13
United States Internal Revenue Service
FATCA Registration Number (“GIIN”)
8Q8ZFE.99999.SL.826
Points of Contact
The Chair or Company Secretaries at the Registered
Office of the Company
Email: murray.income@abrdn.com
Customer Services Department and
Enquiries for the abrdn Children’s Plan, Share
Plan and ISA
abrdn Investment Trusts
PO Box 11020
Chelmsford
Essex CM99 2DB
Freephone: 0808 500 0040
(open Monday to Friday from 9.00am to 5.00pm,
excluding public holidays)
Email: inv.trusts@abrdn.com
Please see page 99 for information on the closure of
the abrdn Children’s Plan, Share Plan and ISA in
December 2023.
Alternative Investment Fund Manager
abrdn Fund Managers Limited
Authorised and regulated by the Financial
Conduct Authority
Investment Manager
abrdn Investments Limited
(formerly Aberdeen Asset Managers Limited)
Authorised and regulated by the Financial
Conduct Authority
Registrar (for direct shareholders)
The Share Portal, operated by Link Group, is a secure
online website where shareholdings can be managed
quickly and easily, including changing address or
arranging to pay dividends directly into a bank account, or
to receive electronic communications. To register,
shareholders will need their Investor Code which may be
found on their share certificate or by contacting the
Registrar at: signalshares.com
Alternatively, please contact the Registrar –
By email, via the above website
By phone, Tel: 0371 664 0300
(UK calls cost 10p per minute plus network extras)
From overseas: +44 208 639 3399
(open Monday to Friday, from 9.00am to 5.30pm,
excluding public holidays)
By post -
Link Group
PXS 1
Central Square
29 Wellington Street
Leeds
LS1 4DL
Independent Auditor
PricewaterhouseCoopers LLP
Depositary
BNP Paribas Trust Corporation UK Limited
Solicitors
Dickson Minto W.S.
Stockbroker
Investec Bank plc
Additional Shareholder Information
murray-income.co.uk
Murray Income Trust PLC
Annual Report 30 June 2023
An investment trust founded in 1923 aiming
for high and growing income with capital growth
For more information visit murray-income.co.uk
abrdn.com