murray-intl.co.uk

Murray International Trust PLC

A high conviction global portfolio designed to deliver

a strong and rising income and to grow capital

Annual Report

31 December 2021

Glasgow’s Finnieston Crane, a symbol of the city’s

industrial heritage. The Company’s roots can be

traced back to Glasgow’s thriving industrial and

shipbuilding-based economy

Murray International Trust PLC 1

“Your Board is recommending an increased final

dividend of 19.0p per share (2020: final dividend of

18.5p). If approved at the Annual General Meeting,

this final dividend will be paid on 18 May 2022 to

shareholders on the register on 8 April 2022 (ex

dividend 7 April 2022).”

David Hardie,

Chairman

“The NAV total return for the year to 31 December

2021 with net dividends reinvested was 14.1%...

Over the full financial year, the double-digit total

return on gross assets was comfortably

ahead of inflation.”

Bruce Stout,

Aberdeen Asset Managers Limited

2 Murray International Trust PLC

Net asset value total return

– 2021 Share price total return

– 2021

+14.1% +7.2%

2020 +0.9% 2020 –5.3%

Reference Index total return

– 2021 Discount to net asset value

– 2021

+20.0% –6.8%

2020 +7.0% 2020 –0.7%

Dividends per share

– 2021 Revenue return per share

– 2021

55.0

51.7

2020 54.5p 2020 46.6p

Retail Prices Index

– 2021 Ongoing charges ratio

7.5% 0.59%

2020 1.2% 2020 0.68%

Alternative Performance Measure (see pages 102 to 104).

For the year to 31 December.

Reference Index comprising 60% FTSE World ex UK Index/40% FTSE World UK Index up to April 2020 and 100% FTSE All World TR Index from May 2020.

As at 31 December.

Dividends declared for the year in which they were earned.

Net asset value per share Dividends per share Mid-Market price per share

At 31 December – pence Year ended 31 December – pence At 31 December – pence

1,251

1,108

1,190

1,138

1,240

17 18 19 20 21

50.0

51.5

53.5

54.5

55.0

17 18 19 20 21

1,268

1,132

1,260

1,130

1,156

17 18 19 20 21

Performance Hi

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Murray International Trust PLC 3

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 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

International 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.

Financial Calendar 4

Financial Highlights 5

Strategic Report

Chairman’s Statement 8

Investment Manager’s Review 12

The Manager’s Investment Process 19

The Manager’s Focus on ESG 21

Investment and ESG Case Studies 25

Key Performance Indicators (KPIs) 28

Performance Track Record 29

Investment Objective and Investment Policy 31

Promoting Your Company’s Success 32

Risk Management and Viability 37

Portfolio

Ten Largest Investments 42

List of Investments 43

Summary of Net Assets 45

Sector/Geographical AnalysisE

Error! Bookmark not defined.

Governance

Board of Directors 52

Directors’ Report 54

Directors’ Remuneration Report 61

Report of Audit and Risk Committee 64

Statement of Directors’ Responsibilities 66

Independent Auditor’s Report to the Members of Murray

International Trust PLC 67

Financial Statements

Statement of Comprehensive Income 76

Statement of Financial Position 77

Statement of Changes in Equity 78

Statement of Cash Flows 79

Notes to the Financial Statements 80

Alternative Performance Measures 102

Corporate Information

Information about the Investment Manager 106

Investor Information 109

Glossary of Terms 112

General

Notice of Annual General Meeting 115

Shareholder Information 120

Company Information 121

Contents

4 Murray International Trust PLC

Payment dates of quarterly dividends

18 May 2022

16 August 2022

18 November 2022

18 February 2023

Financial year end

31 December

Online Shareholder Presentation

Thursday 7 April 2022 at 11.00 a.m.

Annual General Meeting (London)

Friday 22 April 2022 at 12:30 p.m.

Dividends

Rate Ex-dividend date Record date Payment date

1st interim 12.0p 1 July 2021 2 July 2021 16 August 2021

2nd interim 12.0p 7 October 2021 8 October 2021 19 November 2021

3rd interim 12.0p 6 January 2022 7 January 2022 18 February 2022

Proposed final 19.0p 7 April 2022 8 April 2022 18 May 2022

Total dividends 55.0p

Financial Calendar

Murray International Trust PLC 5

31 December 2021 31 December 2020 % change

Total assets

£1,760.9m £1,661.6m +6.0

Net assets £1,561.1m £1,461.8m +6.8

Market capitalisation £1,455.0m £1,451.4m +0.2

Net Asset Value per Ordinary share

1,240.3p 1,138.2p +9.0

Share price per Ordinary share (mid market)

1,156.0p 1,130.0p +2.3

Discount to Net Asset Value per Ordinary share

–6.8% –0.7%

Net gearing

12.2% 13.4%

Revenue return per share 51.7p 46.6p +10.9

Dividends per share

55.0p 54.5p +0.9

Dividend cover (including proposed final dividend)

0.94x 0.86x

Dividend yield

4.8% 4.8%

Revenue reserves

£63.0m £66.8m

Ongoing charges ratio

0.59% 0.68%

See definition on page 113.

Capital values.

Considered to be an Alternative Performance Measure as defined on pages 102 to 104.

The figure for dividends per share reflects the years to which their declaration relates (see note 8 on page 86) and assuming approval of the final

dividend of 19.0p (2020 – final dividend of 18.5p).

The revenue reserve figure does not take account of the third interim and final dividends amounting to £15,103,000 and £23,833,000 respectively (2020 –

third interim dividend of £15,413,000 and final dividend of £23,748,000).

Financial Hi

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6 Murray International Trust PLC

Strategic

Report

The Company invests in Verizon, an American

multinational telecommunications conglomerate

Murray International Trust PLC 7

Murray International Trust PLC is an

investment company with its

Ordinary shares listed on the

premium segment of the London

Stock Exchange. The Company is an

approved investment trust and aims

to achieve an above average

dividend yield, with long-term growth

in dividends and capital ahead of

inflation, by investing principally in

global equities

8 Murray International Trust PLC

Introduction

It was with great sadness that I wrote to shareholders in

August to advise of the death of Simon Fraser, the

Company’s Chairman, following a short illness. Simon

joined the Board in May 2020, initially as a non-executive

Director, becoming Chairman in April 2021. Drawing on his

wealth of experience in fund management, the

investment trust sector and his broader business interests,

Simon made a significant contribution to Board

discussions during his all too short tenure; he will be greatly

missed. As a result, I was appointed interim Chairman in

August 2021 and then accepted the Board’s invitation in

October 2021 to become Chairman of the Company.

Performance

The Company’s net asset value (“NAV”) posted a total

return for the year (i.e. with net income reinvested) of

14.1%. The Company has no benchmark, but this

performance compares with a rise over the same period

of 7.5% for the UK Retail Price Index and a total return for

the Reference Index, the FSTE ALL World TR Index, of

20.0%. The share price posted a lower total return of 7.2%,

reflecting the widening of the discount to NAV. Income per

share generated from the Company’s portfolio increased

to 51.7p for the year (2020: 46.6p).

Our investment focus continued to emphasise both

geographical and sector diversification across a broad

range of quality companies in order to deliver both

income and capital growth. Such characteristics tend not

to be as heavily represented in the Reference Index where

in-favour growth stocks still tend to dominate. For this

reason, relative performance over any short time period

can and does deviate significantly on a comparative basis.

Economic recovery in the Developed World exceeded

expectations and was quickly discounted in the

associated equity markets. As for the Developing World,

however, progress proved slower often due to the

complexities involved with immunisation of predominately

large, dispersed populations. Here improvements in

fundamentals are more likely to occur this year and

beyond. Specific performance highlights of regions,

sectors and holdings are discussed further in the

Investment Manager’s Review.

Against the backdrop of a challenging environment for

the Company in recent years, it is useful to step back and

to look at the Company’s performance versus its

investment objective over time; there may be particular

points in time when inflation spikes cannot be matched

but the chart below indicates that, over the longer term,

the Company has been delivering on its investment

objective to shareholders.

Comparison of Net Asset Value Total Return and Dividend Growth to Inflation (figures

rebased to 100)

Ten years to 31 December 2021

100

120

140

160

180

200

220

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

MINT NAV total return

(CAGR 8.1%)

MINT dividend growth

(CAGR 4.0%)

UK RPI (average 3.3%)

However, in recent years, capital performance has

underperformed the Reference Index and, indeed, the

Company’s peer group; while this is understandable to an

extent, given the significant differences between the

Company’s portfolio and both of these, it has of course

been a source of disappointment to the Board.

Chairman’s Statement

Murray International Trust PLC 9

Accordingly, the Board and Manager have engaged

extensively to discuss the Manager’s investment style and

other factors behind this. These discussions have included

topics such as:

• the Manager’s focus on high quality companies with

strong balance sheets and track records, which have

been out of favour more recently but which may be

better able to weather market volatility and higher

inflationary environments over the longer term;

• the Company’s preference to pay its dividends fully

from revenue and revenue reserves, rather than

seeking to distribute from capital; and

• the Company’s high dividend yield, which leads its

peers.

It is noteworthy that it is these factors and the Company’s

ownership of both bonds as well as equities which provide

shareholders with a markedly different and, hopefully,

attractive opportunity for diversification.

In addition, adverse stock selection has clearly also played

a part in the recent underperformance as can be seen

from the table on page 13. The Board continues to

challenge the Manager to identify investment

opportunities with an acceptable yield that also have

attractive growth prospects and are able to balance

successfully the need for income with the Company’s

desire to deliver capital growth over time. Recent changes

in the portfolio are referred to in the Investment Manager’s

Review.

Dividends

Three interim dividends of 12.0p per share (2020: three

interims of 12.0p) have been declared during the year.

Your Board is now recommending an increased final

dividend of 19.0p per share (2020: final dividend of 18.5p).

If approved at the Annual General Meeting, this final

dividend will be paid on 18 May 2022 to shareholders on

the register on 8 April 2022 (ex dividend 7 April 2022). If the

final dividend is approved, total Ordinary dividends for the

year will amount to 55.0p (2020: 54.5p), an increase over

the previous year of 0.9% which compares with the 7.5%

increase in the Retail Price Index in 2021. The level of

increase reflects the fact that the Company already pays

a competitively high dividend yield which stood at 4.8% at

year end. This represents the 17

year of dividend

increases for the Company, which remains an AIC ‘Next

Generation Dividend Hero’.

As a long-established investment trust, the Company has

the benefit of £62.9 million of distributable reserves on its

balance sheet at 31 December 2021, which have been

accumulated by the Company over many years. The

payment of the final dividend, if approved, will use

approximately £23.9 million from revenue reserves. This

amounts to approximately 36.1% of these reserves and

dividend cover at year end was 0.94x (2020: 0.86x). This

use of reserves is in line with the policy that we have

highlighted to shareholders in previous years. I can

confirm that the Board intends to maintain a progressive

dividend policy, given the Company’s investment

objective. This means that, in some years, revenue will be

added to reserves while, in others, some revenue may be

taken from reserves to supplement earned revenue for

that year, in order to pay the annual dividend.

Shareholders should not be surprised or concerned by

either outcome as, over time, the Company will aim to pay

out what the underlying portfolio earns in sterling terms.

Currency fluctuations may also have an impact on

income and therefore the level of dividend. The Board,

however, is maintaining the present policy not to hedge

the sterling translation risk of revenue arising from non-UK

assets.

Gearing

At the year end, total borrowings amounted to £200

million, representing net gearing (calculated by dividing

the total borrowings less cash by shareholders’ funds) of

12.2% (2020: 13.4%), all of which is drawn in sterling. In May

2021, the Company extended part of its long-term

borrowings by issuing a £50 million 10 year Senior

Unsecured Loan Note (the "Loan Note") at an annualised

interest rate of 2.24%. The Company used the proceeds of

the Loan Note to repay, and cancel in full, the Company's

£50 million Revolving Credit Facility, which expired at that

time. Under the Loan Note facility, an additional £150

million remains available for drawdown by the Company

for a five-year period from its first issue. The Board's

current intention is to only draw this down to repay existing

debt and the Company is now at an advanced stage in

the process of agreeing terms to use £60m of this shelf

facility to replace the £60m term loan when it expires in

May 2022 and expects to provide an update on this

shortly.

Annual General Meeting (“AGM”) and Online

Presentation

For the second year running, the Company’s AGM in 2021

was a functional only AGM due to the pandemic. This was

a source of frustration for the Board; however, an

interactive online shareholder presentation was convened

ahead of the AGM. The online presentation was very well

attended and provided a useful opportunity for the Board

to receive feedback and views as well as to answer

questions from shareholders and prospective investors.

Given the success of the online event, the Board has

decided to hold another, similar interactive online

10 Murray International Trust PLC

shareholder presentation, which will be held at 11.00 a.m.

on Thursday 7 April 2022. This is in addition to the in-person

AGM to be held in London on 22 April 2022. At the online

presentation, shareholders will receive updates from me

as Chairman and the Investment Manager, and there will

be an interactive question and answer session. Full details

on how to join the Online Shareholder Presentation can be

found in my accompanying letter and further information

on how to register for the event can be found at

www.workcast.com/register?cpak=6147225932852209

Following the online presentation, shareholders will still

have almost two weeks during which to submit their proxy

votes prior to the AGM and I would encourage all

shareholders (whether or not they intend to attend

the AGM in person) to lodge their votes in advance

in this manner.

The AGM has been convened for 12:30 p.m. on 22 April

2022 at the Mermaid Conference Centre in London, and

will be followed by light refreshments and an opportunity

to meet the Board and the Investment Manager. Given the

evolving nature of the pandemic, should circumstances

change significantly, rendering an in-person AGM

inadvisable or not permissible, we will notify shareholders

of any changes to the AGM arrangements by updating

the Company’s website at murray-intl.co.uk and through

an RNS announcement, where appropriate, with as much

notice as possible.

Ahead of the online presentation and AGM, I would

encourage shareholders to send in any questions that

they may have for either forum to:

murray-intl@abrdn.com.

On behalf of the Board, I should like to thank shareholders

for their understanding and support over the last two

years and very much look forward to the opportunities to

engage directly with shareholders provided by the online

presentation and subsequent in-person AGM.

Management of Discount and Premium

At the AGM held in April 2021, shareholders renewed the

annual authorities to issue up to 10% of the Company’s

issued share capital for cash at a premium and to buy

back up to 14.99% of the issued share capital at a discount

to the prevailing NAV. During the year, 2,576,806 Ordinary

shares were purchased for Treasury, representing 2.0% of

issued share capital. The Board will be seeking approval

from shareholders to renew the buyback authority

together with the authority to allot new shares or sell

shares from Treasury at the AGM in 2022. As in previous

years, new or Treasury shares will only be issued or sold at

a premium to NAV (excluding income) and shares will only

be bought back at a discount to NAV (including income).

Resolutions to this effect will be proposed at the AGM and

the Directors strongly encourage shareholders to support

these proposals.

Your Board continues to believe that it is appropriate to

seek to address temporary imbalances of supply and

demand for the Company's shares which might otherwise

result in a recurring material discount or premium. The

Board believes that this process is in all shareholders’

interests as it seeks to reduce volatility in the discount or

premium to underlying NAV whilst also making a small

positive contribution to the NAV. Since the year end, up to

3 March 2022, the Company has bought back a further

426,838 Ordinary shares for Treasury. At the latest

practicable date, the NAV (excluding income) per share

was 1243.4p and the share price was 1189.0p, equating to

a discount of 4.4% per Ordinary share compared to a

discount of 6.8% per Ordinary share at the year end.

Management Fee Reduction and Ongoing

Charges Ratio (“OCR”)

On 30 December 2021, the Board was pleased to

announce a reduction in the level of management fees

payable by the Company. From 1 January 2022, the

management fee will be charged at the rate of 0.5% per

annum of Net Assets up to £500m and 0.4% per annum of

Net Assets above £500m. Up to 31 December 2021, the

management fee was charged at the rate of 0.5% of Net

Assets up to £1,200m and 0.425% of Net Assets above

£1,200m. The Board remains focused on controlling costs

and on delivering value to shareholders. The OCR for 2021

has reduced to 0.59% (2020: 0.68%). The reduction in the

level of management fee will, all other things being equal,

flow through to a further reduction in the OCR in future

years.

Environmental, Social and Governance

As part of its responsible stewardship of shareholders’

assets, your Board continues to engage actively with the

Manager with regard to the ongoing assessment and

further integration of Environmental, Social and

Governance (“ESG”) factors in the Manager’s investment

process. The Board receives regular assessments of the

Company’s holdings and portfolio, including a MSCI fund

ratings report which currently gives the Company’s

portfolio a rating of ‘AA’ (2020: ‘A’). Further information on

the important work undertaken on ESG by the Manager is

provided in the Strategic Report on pages 21 to 27.

Climate Change

Your Board supports the principle of further regulation to

promote climate change disclosures and considers that

the related physical, transition and litigation risks are

becoming increasingly likely and financially material.

Chairman’s Statement

Continued

Murray International Trust PLC 11

Without becoming prescriptive on specific investment

criteria, the Board’s desire is for the Manager to build an

increasingly resilient portfolio and to seek to exploit

opportunities arising from a net zero economy, in so far as

this is consistent with the Company’s investment objective.

A key ingredient in building such a portfolio is meaningful,

regular and continuing dialogue between the Manager

and high emitting investee companies, with a view not only

to understanding the risk exposure and evolving business

models better, but also to influencing corporate

behaviour.

The Board is pleased to note that abrdn has joined the Net

Zero Asset Manager initiative – an initiative that will see

asset managers work in collaboration with their clients to

achieve net zero by 2050 or sooner.

Directorate

The Board has had detailed discussions about its

composition during the year and the Company is in the

process of recruiting an additional independent non-

executive Director using the services of an independent

recruitment consultant. Shareholders will be updated

when a candidate has been appointed.

Outlook

The global geopolitical situation looks increasingly

uncertain as a result of the recent Russian invasion of

Ukraine and the consequences and implications which will

flow from that. Whilst the Company does not have any

direct investment in Russian or Ukrainian equities or bonds,

the portfolio does include exposure to some multinational

companies with operations there, or potentially affected

by these events. However, at the time of writing, little more

can usefully be said save that the position will, of course,

continue to be monitored by the Manager and the Board.

This is in addition to the uncertainties resulting from the

pandemic.

As the global economy begins to confront the numerous

challenges presented by the ongoing pandemic, certain

key issues stand out. Many businesses face an uncertain

future from irrevocable changes to work practices,

employment demographics, consumer spending patterns

and leisure behaviour. Governments will count the costs of

expanding fiscal deficits with the unenviable task of

allocating future generations the debt burdens. Finally,

policymakers must tackle an unfamiliar economic

landscape where rising prices and wages arguably

present the most serious hurdle for custodians of

economic prosperity.

From a portfolio perspective, the evolving business

backdrop presents numerous attractive investment

opportunities for the Company’s unconstrained global

mandate. In these uncertain times, the Company’s

inherent investment flexibility permits broad country,

sector and stock diversification at a time when most

global equity markets seem never to have been so

narrow, concentrated and expensive. Exposure to growth

businesses in Asia and the developing world offer,

currently often ignored, potential for superior long-term

total returns, whilst an overall focus of the portfolio on

“real” assets seeks to mitigate rising inflationary threats.

Protecting wealth from the corrosive effects of inflation

has barely registered on investment mandate radars for

many decades now – in the current environment, it may

become a priority. The Manager believes that the

Company’s portfolio exposures reflect such realities as the

Company continues to seek to provide shareholders with

a differentiated proposition that can meet the Company’s

long-term income and capital growth objectives.

Finally, your views matter. Your Board greatly values

shareholder comments and I encourage you to

email me with your views at

DavidHardie.Chairman@murray-intl.co.uk.

David Hardie

Chairman

3 March 2022

12 Murray International Trust PLC

Background

The subjective “science” synonymous with financial

markets attracts many diverse practitioners. Devout

disciples of data worship statistics as the instigator of

relative price moves. Followers of fashion adopt a more

footloose approach, favouring concepts over cash-flows,

perceptions over profits. At the extremes, the apostles of

animal spirits put their faith in “the invisible hand”, a guiding

force anatomically attributed to avarice and anxiety, but

emotionally expressed as greed and fear. For the most

part, such financial ideologies co-exist without much

friction or fissure. But not always. Periodically, the

contemporary dominating dogma becomes

dysfunctional as economic conditions change, the

inevitable consequences invariably being asset-value

dislocations and wealth destruction. Spurious justifications

of excessive valuation repeatedly precede such events,

painful deflation of mispriced assets the recurring

aftermath. The seismic shift in the global economic

landscape over the past twelve months represented the

most serious challenge to prevailing consensus market

doctrine for decades.

At the root was a once familiar foe - inflation. Supposedly

extinct in a world of free-flowing capital, labour and trade,

the silent assassin of wealth returned with a vengeance.

Initially ignored as transitory, then latterly dismissed as

temporary; by year end widespread price rises were

attracting the attention of everyone except the most

foolhardy. The rapid pace of inflation’s resurgence was

relentless, radically “warming” the economic climate

across the globe. Ironically, as if to emphasise the point,

infection mutations related to the pandemic were

perhaps the only cold constant throughout. Coexisting

with the continuing battle against Covid-19, practically

every economy registered a meaningful rebound in

growth and inflation, although rates of expansion proved

extremely erratic, varying enormously between countries

and continents. Vast differences emerged between the

Developed and the Developing Worlds, not solely

attributable to vaccination rates.

Unfettered expansion of fiscal and monetary stimulus in

the Developed World unleashed unwelcome

consequences. Budget deficits ballooned, pent-up

consumer demand overwhelmingly outstripped supply,

and unlimited financing inflated numerous asset bubbles

in different sectors of economies. Equity market valuations

surpassed previous peaks, property prices soared to the

highest multiple of household income on record,

commodity prices skyrocketed upwards and speculative

“investment” in new concepts and conjectures exceeded

all levels of rational reasoning.

At the core of such emphatic exhilaration was, yet again,

irresponsible Central Bankers. Craving popularity over

prudence, the purported guardians of the greater good

constantly stoked the fires of future financial instability by

adhering to inappropriate monetary stimulus way beyond

the boundaries of stated purpose and seemingly oblivious

to the inflationary impacts of such actions. Pandering to

equity markets whilst simultaneously enforcing financial

repression on bonds should have no place in any self-

respecting, independent Central Bank mandate but

unfortunately this has been endemic throughout the

Developed World in recent times.

Conversely, the Developing World generally favoured

constraint in negotiating the untrodden path from the

Covid pandemic. Across Asia and Emerging Markets,

policymakers mitigated business interruptions and social

costs whilst simultaneously implementing prudent policy

responses. Interest rates were raised in anticipation of

future inflationary pressures, and pro-growth initiatives

intensified without exploitation of public financing. Caution

prevailed and careful discretion was exercised with

prosperity simply postponed for the future. A combination

of vaccine shortages, selective reinstated lockdowns,

mandated isolations and generally higher interest rates

were always going to restrain growth in various

developing market countries, but only relatively. The

Chinese economy still expanded over 8% in 2021, with

Taiwan not far behind growing 6%. More importantly,

fiscal respectability was maintained throughout, with local

interest rates free to accurately price risk for both lenders

and borrowers alike. Against this backdrop, corporate

profit recoveries were more subdued than those

experienced in the Developed World, but the delayed

resurgence in earnings and dividends should ultimately

mean they prove to be longer lasting and of higher quality.

Absent of the excesses which prevail in Developed World

asset classes, the risk reward in Asian and Emerging equity

markets remains very compelling.

For a year that began offering a plethora of positive

potential, promising new vaccines, unprecedented

stimulus, widespread economic recovery and contained

inflation, by the end of the period the financial backdrop

had markedly changed. A highly contagious Covid variant,

increasing upward pressure on interest rates, restrained

fiscal spending initiatives and inflation at multi-decade

highs had conspired to sever expectations from reality.

More ominously so did the performance of bond and

equity markets, the former beginning to discount tougher

times ahead, the latter essentially ignoring escalating

inflationary pressures and the consequences that

invariably follow. Unfortunately such naivety is unlikely

to last.

Investment Mana

er’s Review

Murray International Trust PLC 13

Portfolio Activity

Portfolio activity returned to more “normal” levels of

around 12% turnover in gross assets in 2021, having been

higher in 2020 when market volatility presented numerous

opportunities to switch expensive fixed income securities

into undervalued equities. Such pricing discrepancies

proved less prevalent as pandemic-induced panic

subsided, but some notable strategic changes were

implemented. Exposure to Emerging Market Bonds

continued to be reduced such that, by the financial year

end, overall equity exposure had risen to 102.5% of Net

Assets compared to 98.8% at the end of 2020.

In total, five new companies were introduced to the

portfolio and seven companies were fully divested. North

American equity exposure slightly increased on selective

buying of two new positions, Canadian pipeline operator

Enbridge and US pharmaceutical giant Bristol Myers, offset

by the outright sale of semiconductor manufacturer Intel.

European exposure also only marginally increased; with

new purchases of Swiss pharmaceutical company Sanofi

and Scandinavian regional bank Nordea being offset by

outright sales of Bayer and Novartis plus a large reduction

in exposure to Roche

Such activity in these geographical

regions partly reflected a change in Healthcare

preferences, accentuating both potentially higher capital

growth and income opportunities. Overall Asian exposure

marginally declined on a net basis, with outright sales of

Auckland Airport, Swire Pacific and Japan Tobacco, plus

ongoing profit-taking in Taiwan Semiconductor to adhere

to a maximum 5% of total portfolio in any one holding in

accordance with investment guidelines. Only one new

position was established in Asia with the initiation of China

Vanke, a high quality property developer and

management company. Over the period, there were only

two meaningful transactions within UK equities, adding to

the existing holding in out-of-favour Consumer Goods

producer Unilever

and the full divestment of Standard

Chartered Bank. Whilst future prospects for Latin America

remain attractive, the region witnessed the largest

amount of profit-taking within the overall portfolio, the

reduction of Chilean lithium producer Sociedad Quimica

(Soquimich) and Mexican airport operator Grupo Asur

purely a reflection of strong performance and periodically

extended valuations.

From an overall investment perspective, the emphasis

continues to be on diversified asset exposures in

companies deemed beneficiaries of the evolving

backdrop, maintaining a “barbell” strategy of owning both

growth and cyclical stocks. Structurally higher inflation is

supportive of companies owning real assets and exposed

to the global economic cycle, whilst selective growth

companies should benefit from accelerating trends in

industrial automation, semiconductor miniaturisation and

digital communications. In our view, the greatest potential

for positive cyclical momentum upside surprises can still

be identified in Asia and other countries that have lagged

the recovery in the Developed World, given the current

lower expectations for earnings and dividends that prevail.

In such sectors and businesses the portfolio remains

meaningfully invested.

Performance

The NAV total return for the year to 31 December 2021 with net dividends reinvested was 14.1%. This compared with the

Reference Index (FTSE All World) total return of 20.0%. Over the full financial year, the double-digit total return on gross

assets was comfortably ahead of inflation. The top five and bottom five stock contributors are detailed below:

Top Five Stock Contributors %* Bottom Five Stock Contributors %*

Broadcom 0.97 Ping An Insurance -1.10

MTN 0.59 Banco Bradesco -0.84

Nutrien 0.47 Unilever -0.81

GlobalWafers 0.44 Verizon Communications -0.68

Cisco Systems 0.41 Samsung Electronics -0.66

* % relates to the percentage contribution to return relative to the Reference Index (FTSE All World TR Index)

14 Murray International Trust PLC

Global equity market turbulence stabilised to more

normal levels following 2020’s emotion-fuelled roller-

coaster. Apart from a couple of minor spikes in January

and December, volatility remained relatively subdued. In

capital terms, for the third consecutive year, North

America

delivered the strongest index returns, yet again

led by the Technology sector. For the third consecutive

year, this disproportionally inflated returns from the

Reference Index, which remains increasingly detached

from the total return investment objective of any income

focused portfolio. In Sterling terms, both UK

and European

portfolio exposures

recorded high double-digit returns,

the heavy cyclically-weighted UK market witnessing its

best performance for close to a decade with Europe not

far behind. Conversely, a combination of pandemic

variant mutations, difficulties associated with obtaining

and administering vaccines and consequential business

interruptions delayed economic recovery in parts of Asia,

Latin America

and other Emerging Markets.

This was very

much reflected in currency weakness and market returns,

with Asia essentially flat and Latin America and other

Emerging Markets recording negative total returns in

Sterling terms. Encouragingly, portfolio returns from

exposures in these regions witnessed high single-digit

contributions, primarily from strong stock selection

amongst commodity and industrial holdings.

Predicting dividend income over the financial year again

proved extremely problematic. Although the scale of

pandemic induced uncertainty and business disruption

moderated from last year’s constant convulsions, most

companies remained reluctant to give guidance on future

trading conditions. Cancelled or suspended dividends

from the previous year were mostly restored, and some

were even raised above pre-pandemic levels, but a

sizable majority were reset lower to reflect more modest

expectations going forward. Currency movements

against Sterling experienced relatively normal volatility

within an historical context, with the usual unpredictability

of magnitude and direction. Where Sterling strength

prevailed, it tended to be dictated by non-financial

influences, particularly during waves of infection

mutations in those countries still struggling to contain the

pandemic such as South Africa, Brazil and Thailand.

Dividend increases from portfolio companies generally

exceeded conservative estimates, with 70% of holdings

falling into this category. The largest contribution to

recovery in revenues came from holdings in mining stocks,

banks, insurance and pharmaceuticals. Reduced dividend

distributions were almost exclusively a feature of Asian

holdings, caused by maintaining the discipline of paying

fixed percentage pay-out ratios on business interrupted

earnings from the previous year. This practice will likely

positively impact the current financial year given the

stronger earnings growth witnessed in 2021. Overall gross

income increased +14.2% year-on-year, with earnings per

share growth of +11.0% reflecting lower dividend tax

reclaims than the prior period.

Attribution Analysis

The attribution analysis overleaf details the various

influences on portfolio performance. In context, it should

be noted that the Company’s income objective gives rise

to a portfolio of investments that differs significantly from

the Reference Index in terms of geographical exposures,

sector allocations and stock selection. During the period

under review, when increasingly concentrated market

(United States), sector (technology) and stock (low-

yielding) outperformance continued to dominate

composite index returns, the statistical limitations of

relative attribution analysis were clearly evident. However,

from the analysis, in summary, of the 440 basis points

(before expenses) of performance below the reference

index, asset allocation detracted 270 basis points and

stock selection detracted 170 basis points. Structural

effects, relating to the fixed income portfolio and gearing

net of borrowing costs, detracted a further 30 basis points

of relative performance.

Continued

Investment Mana

er’s Review

Murray International Trust PLC 15

Company Reference Index

Contribution from:

Asset Stock

Weight Return Weight Return Allocation Selection Total

% % % % % % %

UK 5.9 15.1 3.9 18.4 – –0.3 –0.3

Europe ex UK 20.6 11.1 13.2 17.6 0.6 –2.1 –1.5

North America 31.2 27.2 62.4 28.1 –2.3 –0.4 –2.7

Asia Pacific ex Japan 29.7 9.5 12.1 –0.1 0.2 –0.5 –0.3

Japan – – 6.3 2.5 1.3 –0.1 1.2

Other International 12.6 12.1 2.1 10.1 –2.5 1.7 –0.8

Gross equity portfolio return 100.0 15.6 100.0 20.0 –2.7 –1.7 –4.4

Fixed income –

Gross portfolio return

15.6

Management fees and admin expenses –0.7

Tax charge –0.6

Finance costs –0.3

Technical differences 0.1

Total return 14.1 20.0

Reference Index – FTSE All World TR Index

Notes to Performance Analysis

Asset Allocation effect – measures the impact of over or underweighting each asset category, relative to the Reference Index weights.

Stock Selection effect – measures the effect of security selection within each category.

Technical differences – the impact of different return calculation methods used for NAV and portfolio performance

Source: abrdn plc & BNP Paribas Securities Services Limited.

Global Review

Given the depth of regional recessions and deeply

distorted macroeconomic trends that prevailed

throughout the world in 2020, economic recoveries in 2021

were unlikely to be smooth, uniform and predictable. In the

event, what transpired clearly proved the point. As

business interruptions sporadically continued and financial

legacies mounted, consumers, companies and

governments remained hostage to unfamiliar

circumstances. Nowhere was this more evident than in

the United States. A high-octane cocktail of extremely

loose monetary policy, huge transfer payments to

unemployed consumers during the pandemic and

promises of massive future fiscal stimulus fuelled a frenzy

of equity investment. Anticipation of higher future

corporate earnings inflamed the momentum. In the real

economy, labour markets tightened as economic

recovery gained traction, pent-up demand far

outstripped supply, and a booming US economy

succumbed to the inevitable – inflation. The Federal

Reserve’s pledge to tolerate “moderately” higher inflation

until the economy generated full employment evaporated

in line with other post-pandemic promises, leaving policy

in limbo and increasingly susceptible to speculative forces.

The year ended with rising expectations for imminent

interest rate hikes, an end to printing money and less fiscal

largesse. How this relates to current valuations on US

equities and bonds remains of key concern.

Under virtually any scenario apart from the belief that rock

bottom interest rates will prevail in perpetuity, the US

equity market stands out as excessively valued. Year-on-

year comparisons for quarterly earnings will become

tougher throughout this year, as will debt servicing and

perhaps even access to new capital. Corporate taxes

may also have to rise if politicians ever, even reluctantly,

wish to restore some semblance of fiscal respectability.

The US bond market also has many uncertainties to

negotiate: constant monetary intervention over the past

decade has distorted the US bond market beyond

recognition, such that America faces the future with the

most negative real interest rates since the 1950s. Bank

deposits are already being eroded by inflation. For now,

16 Murray International Trust PLC

the US bond market seems impotent to correctly price

increasingly evident inflationary pressures, but scope

clearly exists for significant upward moves in bond yields if

market forces are restored to fixed income valuations.

For the UK and Europe, the divergence between economic

fundamentals and equity markets appears less stretched

on an absolute basis, but careful consideration must be

given to the more cyclical nature of key index constituents

and the sustainability of recovering growth dynamics. For

both these “regions”, painful price and wage inflation are

already causing numerous problems. Rigid labour

markets, spiralling energy costs, higher taxes and

increasing trade barriers suggest the post-pandemic

future will be decidedly different from what prevailed

before. For consumers and businesses alike, this changing

landscape brings significant challenges. Generalisations

carry significant risk so evaluating individual companies

relative to global sector dynamics arguably provides more

insight than purely domestic market comparisons.

Specifically, individual portfolio holdings in the UK and

Europe generally emphasise real assets with some degree

of pass-through pricing power. Diversified energy

companies with accelerating renewables exposure are

preferred (TotalEnergies and Shell) over more narrowly

focused producers. Asset rich communication companies

operationally leveraged to recovering wireless traffic

(Vodafone and Telenor) look better positioned than liability

heavy incumbents. Insurance providers unburdened by

legacy business, over-zealous regulators or lingering

political interference (Tryg and Zurich Finance) remain

attractive total-return prospects. Finally, asset light

industrials exposed to recovering manufacturing

industries and growth in commodity volumes (Atlas Copco

and Epiroc) appear well placed to benefit from ongoing

global recoveries. Finding the combination of appropriate

dividend yield and attractive valuation in these types of

businesses remains a key investment priority.

The polarisation between vaccination progress in the

Developed World and vaccination roll out across the

Developing World could crudely be interpreted as

responsible for relative regional equity market returns as

previously discussed. This gross simplification only gives

part of the reasoning. Sentiment towards Asia, Latin

America and other Emerging Markets proved almost

universally negative throughout as constant lock-downs,

business interruptions and locally emerging new variants

kept investors wary. The pandemic undoubtedly played its

part in paralysing international risk appetite. Yet,

encouragingly for many countries, an arguably more

cautious approach to limiting social mobility and ensuring

infection rates were kept to a minimum, protecting

domestic interests with the long term in mind. Industrial

powerhouses such as Taiwan and Korea hardly missed a

beat, whilst Singapore remained focused on maintaining

financial stability throughout. China’s “common prosperity”

crusade caused eruptions across many domestic sectors,

causing foreign capital to flee and international scrutiny to

intensify but, for the most part, emotive rhetoric was

aimed more at purging excesses and resetting

boundaries than destroying the nation’s increasingly

capitalist dependency. From a portfolio perspective, Asian

industrials, telecommunications and banking exposure

generally performed well, and total returns from the

region contributed positively to both income and capital.

The same was the case for Latin America. The

contributions to the Company’s improving income

statement from Chilean lithium producer Soquimich and

Vale in Brazil were significant, as was the total return from

Grupo Asur in Mexico. The blend of both growth and

cyclical value at attractive valuations remains most

pronounced in these regions. With enormous pent-up

demand still to be unleashed as social constraints are

eased, the scope for operational leverage on profits, and

consequentially dividends, augers well for companies

exposed to these trends this year and beyond.

Investment Mana

er’s Review

Continued

Murray International Trust PLC 17

Summary of Investment Changes During the Year

Valuation Appreciation/ Valuation

31 December 2020 (depreciation) Transactions 31 December 2021

£’000 % £’000 £’000 £’000 %

Equities

UK 73,372 4.5 1,265 11,235 85,872 5.0

Europe ex UK 274,030 16.6 19,819 11,038 304,887 17.5

North America 380,614 23.1 90,913 25,369 496,896 28.6

Asia Pacific ex Japan 489,281 29.7 29,363 (15,325) 503,319 28.9

Japan 13,848 0.8 (1,052) (12,796) – –

Latin America 218,535 13.3 3,453 (37,923) 184,065 10.6

Africa 5,995 0.4 9,799 – 15,794 0.9

1,455,675 88.4 153,560 (18,402) 1,590,833 91.5

Preference shares

UK 7,488 0.5 149 – 7,637 0.4

7,488 0.5 149 – 7,637 0.4

Bonds

Europe ex UK 13,182 0.8 (7,005) (154) 6,023 0.4

Asia Pacific ex Japan 69,365 4.2 (1,722) (15,117) 52,526 3.0

Latin America 83,621 5.1 (3,781) (13,137) 66,703 3.8

Africa 17,074 1.0 (1,564) 80 15,590 0.9

183,242 11.1 (14,072) (28,328) 140,842 8.1

Total Investments 1,646,405 100.0 139,637 (46,730) 1,739,312 100.0

18 Murray International Trust PLC

Outlook

Despite consensus claims to the contrary, assessing

investment prospects arguably remains rooted more in

definitive and discernible assets rather than instinctive or

idiosyncratic ideas. Add inflation to the equation and

what’s tangible today invariably takes precedence over

tomorrow’s potential promises. In essence, inflationary

dynamics distort accurate future valuation assumptions,

eroding predictability of interest rates, currencies, returns

on capital and growth. Against such a backdrop, foresight

favours simplicity. Looking backwards, there can be no

argument that the unforeseen circumstances brought

about by the global pandemic favoured Technology

companies which thrived under social and economic

isolation. Enormous behavioural changes driven by

electronic services are testimony to that. Whilst none of

these trends is likely to reverse, looking forward the global

economy looks destined to be confronted by more

familiar influences, namely interest rates, inflation

and infections.

Of the three, the lingering pandemic is arguably the

hardest to integrate. It potentially constrains the outlook

for economic growth whilst simultaneously carrying the

capacity to disrupt business further. Such a scenario

merely exaggerates inflationary pressures. In essence, a

double negative with no positive connotations. In terms of

interest rates, the landscape looks more defined. With

most G7 central banks late to acknowledge inflationary

threats, the removal of extremely accommodative

monetary stimulus is a matter of when, not if. Thereupon,

the availability of money rapidly mutates from plenty to

paucity for those nations most affected. Herein lies the

potential for the greatest margin of error. With inflation

already breaching 40-year highs in numerous economies,

fears are escalating that policy makers are already too

late to act effectively. The destructive dynamic of central

banks aggressively tightening into economies already

decelerating naturally is a tragically familiar feature of

economic history. Simultaneously, shrinking government

balance sheets, raising interest rates and taming inflation,

all without affecting growth, is most definitely not a precise

science. Any tightening cycle is fraught with angst and

apprehension, and this time will be no different.

Most ominously, rising global protectionism, regulation and

redistribution of wealth to labour from capital represent

new challenges for financial markets. The powerful

deflationary forces of globalisation and technology

disruption, which defined improved productivity and

contained inflation for previous decades, are increasingly

under threat, potentially heralding in a period of greater

inefficiencies and price rises. Sparse economic growth

against a backdrop of liberal monetarism, so prevalent in

the current century to date and inspiration for the “pay

any price for growth” mentality that dominated the

mantra of the 2010-2020 investment generation may be

about to broaden out considerably. An inflationary

environment represents a paradigm shift from what has

recently prevailed, prompting the allocation of capital,

savings and investment to be influenced by dramatically

different factors. Against such a backdrop, great care

continues to be exercised, with investment emphasis on

diversification, quality and real tangible assets. By

maintaining our disciplined investment approach towards

delivering income growth through careful allocation of

capital our flexible mandate is well positioned to capitalise

on whatever investment opportunities lie ahead.

Bruce Stout

Senior Investment Director

Martin Connaghan,

Investment Director

Samantha Fitzpatrick,

Investment Director

3 March 2022

Investment Mana

er’s Review

Continued

Murray International Trust PLC 19

The Company’s Alternative Investment Fund Manager is

Aberdeen Standard Fund Managers Limited (“ASFML”)

which is authorised and regulated by the Financial

Conduct Authority. Day-to-day management of the

portfolio is delegated to Aberdeen Asset Managers

Limited (“AAM”). AAM and ASFML are collectively referred

to as the “Investment Manager” or the “Manager”. The

ultimate parent of AAM and ASFML is abrdn plc (previously

known as Standard Life Aberdeen plc).

The Manager believes that deep fundamental research

into companies, mediated through team debate and a

rigorous stock selection process, is the key to unlocking

investment insight and driving investment returns for

clients such as the Company. The Manager utilises a truly

bottom-up, fundamental stock-picking approach, where

sector, regional and country allocations are a

consequence of the bottom-up stock selection decisions,

constrained by appropriate risk controls. The Manager

operates a comprehensive risk system with tools that

provide better insights for its individual fund managers and

a more complete understanding of all risk exposures in the

portfolios to ensure that the managers only take the sort

of risk that the Manager is comfortable with and can back

with insight from extensive first hand research.

The Manager takes a long term quality approach by

focusing on companies that the research analysts identify

as high quality. This involves assessing each company on

five key factors, namely the durability of the business

model and moat, the attractiveness of the industry, the

strength of the financials, the capability of management,

and assessment of the company’s ESG credentials. In the

assessment of what is an appropriate valuation for a

company, the Manager focuses primarily on earnings

yields, free cashflow yields and dividend yields, set against

expected long-term growth rates for those elements. The

Manager targets a double digit implied annual return.

From this pool of companies the Manager looks to

construct a focused portfolio of 40 - 60 companies,

selecting those companies that have the most attractive

quality and valuation characteristics, offering the best

expected risk adjusted returns, within a diversified

portfolio. Position sizes typically range from 1% to 5% and

are considered on an absolute, rather than benchmark

relative basis.

An overview of the investment process is provided below

and further explanation of this process can be found on

pages 19 and 106.

The Mana

er’s Investment Process

20 Murray International Trust PLC

Reference Index

The Company does not have a Benchmark. However,

performance is measured against a number of measures

including a Reference Index, the FTSE All World TR Index,

which was adopted in April 2020. Given the composition

of the portfolio and the Manager’s investment process, it is

likely that the Company’s investment performance may

diverge, possibly significantly, from this Reference Index.

Performance prior to April 2020 is measured against a

blend of the old composite Benchmark (40% of the FTSE

World UK Index and 60% of the FTSE World ex-UK Index)

up to 27 April 2020 and the FTSE All World TR Index

thereafter.

Delivering the Investment Policy

Day-to-day management of the Company’s assets has

been delegated to the Manager. The Manager invests in a

diversified range of international companies and securities

in accordance with the investment objective.

The Manager has responsibility for portfolio construction

across all regional segments and the team is led by Bruce

Stout with dedicated support from Martin Connaghan and

Samantha Fitzpatrick. The management team utilises a

“Global Coverage List” which is constructed by each of the

specialist country management teams. This list contains

all buy (and hold) recommendations for each

management team, which are then used by the portfolio

manager as the Company’s investment universe. Stock

selection is the major source of added value over time.

Top-down investment factors are secondary in the

Manager’s portfolio construction, with stock diversification

rather than formal controls guiding stock and sector

weights. Market capitalisation is not a primary concern.

A detailed description of the investment process and risk

controls employed by the Manager is disclosed on pages

19 and 106 and in note 18 to the financial statements. A

comprehensive analysis of the Company’s portfolio is

disclosed on pages 42 to 49 including a description of the

ten largest investments, the portfolio of investments by

value and a sector and geographical analysis of

investments. The portfolio attribution analysis is on page

15.

In addition to equity exposures, the investment mandate

provides the flexibility to invest in fixed income securities.

The process of identifying, selecting and monitoring both

sovereign and corporate bonds follows exactly the same

structure and methodology as that for equity investment,

fully utilising the global investment resources of the

Manager. As in the case of equity exposure, the total

amount, geographical preference, sector bias and

specific securities will ultimately depend upon relative

valuation and future prospects.

At the year end, the Company’s portfolio consisted of 51

equity and 20 bond holdings. The Manager is authorised

by the Board to hold between 45 and 150 holdings in the

portfolio.

The Mana

er’s Investment Process

Continued

Murray International Trust PLC 21

Introduction

Whilst environmental, social and governance (“ESG”)

factors are not the over-riding criteria in relation to the

investment decisions taken by the Manager for the

Company, significant attention is given to ESG and climate

related factors throughout the Manager’s investment

process. The Manager gives particular weight to ESG

factors when they are material to the investment case

being made for an investee company.

The following pages highlight the way that ESG and

climate change are considered by the Manager. These

processes are reviewed regularly and liable to change

and the latest information will be available for download

on the Company’s website, murray-intl.co.uk.

Core beliefs: Assessing Risk, Enhancing Value

Whilst the management of the Company’s investments is

not undertaken with any specific instructions to exclude

certain asset types or classes, the consideration of ESG

factors is a fundamental part of the Manager’s investment

process and has been for over 30 years. It is one of the key

criteria on which the Manager assesses the investment

case for any company in which it invests for three key

reasons.

Responsible Investing – Integration of ESG into the Manager's Investment Process

“By embedding ESG factors into our active equity investment process we aim to reduce risk, enhance potential value for

our investors and foster companies that can contribute positively to the world.”

abrdn

Financial Returns ESG factors can be financially material – the level of consideration they are given in a

company will ultimately have an impact on corporate performance, either positively

or negatively. In the Manager’s view, those companies that take their ESG

responsibilities tend to outperform, over time, those that do not.

Fuller Insight Systematically assessing a company’s ESG risks and opportunities alongside other

financial metrics allows the Manager to make better investment decisions.

Corporate Advancement Informed and constructive engagement helps foster better companies, protecting

and enhancing the value of the Company’s investments.

“We believe that the market systematically undervalues the importance of ESG factors. We believe that in-depth ESG

analysis is part of both fundamental company research and portfolio construction and will lead to better client

outcomes.”

abrdn

Researching Companies: Deeper Company

Insights for Better Investor Outcomes

The Manager conducts extensive and high-quality

fundamental and first-hand research to fully understand

the investment case for every company in its global

universe. A key part of the Manager’s research involves

focusing its extensive resources on analysis of ESG issues.

The Manager’s investment managers, ESG Equity Analysts

and central ESG Investment Team collaborate to

generate a deep understanding of the ESG risks and

opportunities associated with each company.

Stewardship and active engagement with every company

are also fundamental to the investment process helping to

produce positive outcomes that lead to better risk-

adjusted returns.

abrdn’s Global ESG Infrastructure

abrdn has over 1,000 investment professionals globally

including investment managers, ESG Equity Analysts and

the central ESG Investment Team who systematically

analyse ESG risks and opportunities as part of the

Manager’s research output for each company. Its central

team and ESG equity analysts support the investment

managers’ first-hand company analysis, producing

research into specific themes (e.g. labour relations or

climate change), sectors (e.g. forestry) and ESG topics to

understand and highlight best practice. Examples of

thematic and sector research can be found on the

Manager’s website at:

www.abrdn.com/discretionary/investment-

approach/responsible-investing.

The Mana

er’s Focus on ESG

22 Murray International Trust PLC

Investment Managers All abrdn equity investment managers seek to engage

actively with companies to gain insight into their specific

risks and provide a positive ongoing influence on their

corporate strategy for governance, environmental and

social impact

ESG Equity Analysts abrdn has dedicated and highly experienced ESG

equity analysts located across the UK, US, Asia and

Australia. Working as part of individual investment

teams, rather than as a separate department, these

specialists are integral to pre-investment due diligence

and post-investment ongoing company engagement.

They are also responsible for taking thematic research

produced by the central ESG Investment Team (see

below), interpreting and translating it into actionable

insights and engagement programmes for our regional

investment strategies.

ESG Investment Team This central team of more than 20 experienced

specialists based in Edinburgh and London provides

ESG consultancy and insight for all asset classes. Taking

a global approach both identifies regions, industries and

sectors that are most vulnerable to ESG risks and

identifies those that can take advantage of the

opportunities presented. Working with investment

managers, the team is key to the Manager’s active

stewardship approach of using shareholder voting and

corporate engagement to drive positive change.

Climate Change

According to the United Nations, climate change refers to

the long-term shifts in temperatures and weather

patterns. These shifts may be natural, such as through

variations in the solar cycle. But since the 1800s, human

activities have been the main driver of climate change,

primarily due to burning fossil fuels such as coal, oil and

gas.

Burning fossil fuels generates greenhouse gas emissions

that act like a blanket wrapped around the Earth, trapping

the sun’s heat and raising temperatures.

Examples of greenhouse gas emissions that are causing

climate change include carbon dioxide and methane.

These come from using fuel for driving a car or coal for

heating a building, for example. Clearing land and forests

can also release carbon dioxide. Landfills for waste are a

major source of methane emissions. Energy, industry,

transport, buildings, agriculture and land use are among

the main emitters.

The Manager has a duty to consider all factors that may

have a financially material impact on returns. Climate

change is such a key factor.

The related physical and transition risks are vast and are

becoming increasingly financially material for many of our

investments. This is not only true in the obvious high-

emitting sectors, such as energy, utilities and

transportation, but also along the supply chain, providers

of finance and in those reliant on agricultural outputs and

water.

In the Manager’s view, companies that successfully

manage climate change risks will perform better in the

long term. It is important that the Manager assesses the

financial implications of material climate change risks

across all asset classes, including real assets, to make

portfolios more resilient to climate risk.

Adaptation measures are essential to help limit damages

from the physical impacts of climate change.

Comparable climate-related data is necessary to enable

effective decision making, and is something the Manager

actively sources and incorporates into its process. The

Manager is supportive of the Task Force on Climate-

related Financial Disclosures (TCFD) framework to

strengthen climate reporting globally.

Continued

The Mana

er’s Focus on ESG

Murray International Trust PLC 23

Regular engagement with high-emitting investee

companies allows the Manager to better understand its

exposure and management of climate change risks and

opportunities. In actively managed investments,

ownership provides a strong ability to challenge

companies where appropriate. The Manager can also

influence corporate behaviour positively in relation to

climate-risk management.

The Manager believes that this is more powerful for an

effective energy transition than a generic fossil fuel

divestment approach. Through active engagement it is

possible to steer investee companies towards ambitious

targets and more sustainable low-carbon solutions. If

there is limited progress in response to the engagement,

the Manager will consider the ultimate option of selling its

holdings.

The Manager strongly encourages companies to consider

the social dimension of the energy transition to ensure it is

inclusive and ‘just’. This means worker and community

needs are considered on the path to a low-carbon

economy so they are not left stranded. Other social

aspects, such as affordability and reliability of energy

supply are also important. Influencing through

engagement has worked particularly well in collaboration

with other asset managers and asset owners as part of

our involvement in Climate Action 100+. This is a five-year

initiative to engage and influence high-emitting

companies collaboratively.

Consideration of climate change risks and opportunities is

an integral part of the investment process and corporate

engagement is seen as essential to ensuring that portfolio

companies manage climate-related risks and support a

‘just’ energy transition. This is an important part of the role

of an active investor.

The Manager provides climate change insights through

research and data to investment decision makers. This

helps assess the financial materiality of climate change

risks and opportunities. The Manager aims to influence the

management of climate-related risks through

engagement and voting and is part of Climate Action 100+

having signed the 2018 Just Transition statement.

The Manager is also a signatory to the Net Zero Asset

Manager Initiative, which informs how the Manager

conducts research, selects and manages investments.

The Manager also pledges to reduce its own operational

carbon footprint. It has committed to reducing emissions

from energy use by 50% by 2025, procuring 100%

renewable electricity for its buildings, and offsetting those

emissions that have not yet been eliminated.

From Laggards to Best in Class: Rating

Company ESG Credentials

A systematic and globally-applied approach to evaluating

stocks allows the Manager to compare companies

consistently on their ESG credentials – both regionally and

against their peer group.

The Manager captures the findings from its research and

company engagement meetings in formal research

notes.

Some of the key questions include:

· Which ESG issues are relevant for this company, how

material are they, and how are they being addressed?

· What is abrdn’s assessment of the quality of this

company’s governance, ownership structure and

management?

· Are incentives and key performance indicators aligned

with the company’s strategy and the interests of

shareholders?

Having considered the regional universe and peer group in

which the company operates, the Manager’s equity team

then allocates it an ESG rating between one and five (see

below). This is applied across every stock that the

Manager covers globally.

The Manager also uses a combination of external and

proprietary in-house quantitative scoring techniques to

complement and cross-check analyst-driven ESG

assessments. ESG analysis is peer-reviewed within the

equities team, and ESG factors impacting both sectors

and stocks are discussed as part of the formal sector

reviews. To be considered ‘best in class’, the management

of ESG factors must be a material part of the company’s

core business strategy. It must provide excellent disclosure

of data on key risks. It must also have clear policies and

strong governance structures, among other criteria.

24 Murray International Trust PLC

1. Best in class 2. Leader 3. Average 4. Below average 5. Laggard

ESG considerations

are material part of

the company’s core

business strategy

Excellent disclosure

Makes

opportunities from

strong ESG risk

management

ESG considerations

not market leading

Disclosure is good,

but not best in class

Governance is

generally very good

ESG risks are

considered as a part

of principal business

Disclosure in line with

regulatory

requirements

Governance is

generally good but

some minor concerns

Evidence of some

financially material

controversies

Poor governance or

limited oversight of

key ESG issues

Some issues in

treating minority

shareholders poorly

Many financially

material

controversies

Severe governance

concerns

Poor treatment of

minority

shareholders

At the time of writing, 3 March 2022, 6.8% of the Company’s portfolio is invested into companies with an ESG rating of

level 1, 28.7% in assets with an ESG rating of 2, 46.9% in businesses with an ESG rating of 3, 8.9% in investments with an

ESG rating of level 4 and there were no investments in companies rated 5. The Company’s bonds and cash holdings

are unrated.

Working with Companies: Staying Engaged,

Driving Change

Once abrdn invests in a company, it is committed to

helping that company maintain or raise their ESG

standards further, using the Manager’s position as a

shareholder to press for action as needed. abrdn actively

engages with the companies in which it invests to maintain

ESG focus and encourage improvement.

The Manager sees this programme of regular

engagement as a necessary fulfilment of its duty as a

responsible steward of clients’ assets. It is also an

opportunity to share examples of best practice seen in

other companies and to use the Manager’s influence to

effect positive change. The Manager’s engagement is not

limited to the 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 clients. What gets

measured gets managed, so the Manager strongly

encourages companies to set clear targets or key

performance indicators on all material ESG risks.

The investment process consists of four interconnected

and equally important stages:

Monitor Contact Engage Act

Ongoing due diligence

· Business performance

· Company financials

· Corporate governance

· Company’s key risks

and opportunities

Frequent dialogue

· Senior executives

· Board members

· Heads of departments

and specialists

· Site visits

Exercise rights

· Attend AGM/EGMs

· Always vote

· Explain voting decisions

· Maximise influence to

drive positive outcomes

Consider all options

· Increase or decrease

our shareholding

· Collaborate with other

investors

· Take legal action if

necessary

The Mana

er’s Focus on ESG

Continued

Murray International Trust PLC 25

The Manager takes into consideration many factors when deciding whether to invest in or divest from a company.

These factors have been described in the previous sections covering The Manager’s Investment Process and The

Manager’s Focus on ESG and are further illustrated by the case studies below.

GlobalWafers Case Study

The Company first invested in Taiwan-listed GlobalWafers

back in 2019. It is the country's largest silicon wafer maker

and the third-largest worldwide. A key material in the

semiconductor industry, GlobalWafer's products feed into

the supply chains of technology leaders like TSMC,

Samsung Electronics and Intel. This exposes the company

to a comprehensive suite of structural trends globally,

such as increasing 5G adoption, rising demand for higher

computing power, and accelerating digitalisation and

automation across various industries. These end market

exposures were the primary driver for the initiation, while

also affording the Company the opportunity to diversify its

semiconductor exposure to a degree. The company had

executed very well on increasing its scale and capabilities

via acquisitions and the thesis was that management

would continue to execute well while also maintaining

attractive returns to shareholders.

With a long history dating back to 1981, the company has

steadily grown its scale and manufacturing expertise over

the years through mergers and acquisitions, allowing it to

capture orders from top-tier customers, which account

for nearly half of the company's annual sales. In addition,

the increasingly consolidated nature of the industry

means that major clients will remain with trusted suppliers

such as GlobalWafers for repeat orders. At the same time,

the prohibitive cost of bringing on new wafer capacity will

keep prospective new entrants at bay. This competitive

edge has allowed GlobalWafers to generate high returns

and sustainable cash flows through the years, bolstering a

solid balance sheet and allowing for a generous

shareholder return policy.

The Covid-19 pandemic saw several trends emerge, such

as remote working, increased e-commerce and logistics

demand, and greater security, connectivity, and

digitalisation requirements. Coupled with lockdown-

induced disruptions and US-China trade disputes, this has

led to a higher demand for chips as semiconductor

companies sought to restock and meet this surge.

GlobalWafers has capitalised on this opportunity to

increase wafer prices and contracts in this environment of

more robust demand and tighter supply.

Looking ahead, GlobalWafers had been considering a

majority stake in German rival, Siltronic, which would have

taken GlobalWafers to the position of second largest

silicon wafer maker globally. Germany's Economic

Ministry did not clear the €4.35 billion deal, citing concerns

around "tech sovereignty", where countries do not want to

rely on other countries for critical technologies like

semiconductors.

While the Siltronic deal would have been a positive

development for the business, fortune tends to favour the

high quality executors in this space. This should still place

GlobalWafers in good standing to reap the benefits of

these ongoing trends driving the current semiconductor

upcycle, which is why it remains a core holding.

GlobalWafers has also made notable progress in

disclosing energy usage and recycling targets. In the

future, it will publish plans on how the company can align

itself to net-zero carbon initiatives. This progress is

pertinent because it is part of chipmaker TSMC’s supply

chain. TSMC, another key holding of the Company, has

committed its supply chain to adhere to the initiatives

above. GlobalWafers is running the net zero carbon

disclosure exercise and will share its plans when they are

completed. While they are to be congratulated on

improved disclosure, we also noted that its ESG rating with

MSCI is below expectations and shared its perceived

areas of weakness. We have held initial discussions with

the company on each of these points and will follow up on

suggested action points.

Vale ESG Case Study Update

In the 2019 Annual Report we provided shareholders with

an update on the Feijao dam collapse in the city of

Brumadinho in 2018 and highlighted the Manager’s

engagement with Vale in the aftermath of the disaster.

abrdn’s engagement with portfolio companies is a

continuous process and this year we are providing

Investment and ESG Case Studies

26 Murray International Trust PLC

shareholders with a detailed update, having seen tangible

progress regarding the level of disclosure and detailed

information that Vale has provided to investors.

Upstream tailings dam progress

There are sixty-five upstream dams (the type that failed)

in Brazil, which account for fourteen percent of the total

amount. An upstream dam is constructed using the

deposited tailings, or waste, and is built in the opposite

direction to the water flow. These are no longer allowed to

be constructed or operated in Brazil following stricter

regulations brought in after the tragedy. Vale owns one

hundred and ten tailings dams in Brazil, seventeen of

which are upstream. Vale has already eliminated seven

upstream tailing dams and expects to de-commission a

further five in 2022. All are expected to be eliminated by

2035.

Reparations

In February 2021, the complete reparation agreement of

R$37.7bn (approximately US$7bn) was signed by Vale, the

Minas Gerais state government, the State and Federal

Public Prosecutor's Office, and the Public Defender's

Office for the State of Minas Gerais. This is a civil

agreement only, which means that criminal proceedings

remain open. The agreement includes (1) Income

Transfer Program for local communities, (2) Projects

demanded by the affected communities, and (3) Water

security for the affected region. Approximately 55% of

total payments had already been made by December

2021.Vale has taken additional measures out with this

agreement, including funding studies on risks to human

health and ecology, monitoring the groundwater for

human consumption, and paying for temporary housing

whenever necessary.

Recycled tailings waste

Vale and other players in the industry are currently

developing products made from the reuse/recycling of

dry tailings. These products include cement/concrete

mixture, bricks and green tyres. We believe the

development of these products should bring an important

sustainable component to the industry as a whole.

Operational improvements

Operational safety, or more specifically dam safety, is a

crucial topic for Vale. Vale’s reputation was badly

damaged by its indirect involvement in the 2018 Mariana

dam disaster, followed by its direct responsibility for the

Brumadinho accident. These events evidenced the

instability of upstream dam structures. Brumadinho also

highlighted that Vale failed to identify risks and strengthen

its risk management framework in light of the Mariana

dam failure. Although these events will forever tarnish the

company's history, the Brumadinho accident has

triggered significant internal changes which aim to

transform Vale, and reposition the company as a

benchmark for safety and ESG issues. Operational risks

cannot be eliminated, but the company has significantly

improved its risk management framework and

governance. The company has ambitious targets to de-

risk its operations and essential milestones have already

been achieved.

Vale has a new ‘ESG Roadmap’ initiative which includes

key targets such as: (i) compliance with the Paris

agreement to become carbon neutral by 2050 with 100%

of self-generation of clean energy; (ii) reduction in water

collection by 10%; (iii) reforestation goals increased

fivefold and a 50% increase in the area of forest protected

by the company; (iv) improvement in the diversity of

management and employees -e.g. Increase women's

participation from 13% to 26% by 2030; (v) compliance

with new Health and Safety system targets and get ISO

14001 certification by 2022. It is also worth noting that the

company has included ESG key performance indicators

(KPI's) in short and long term remuneration plans.

Vale has materially changed its approach towards safety

and risk management since the Brumadinho tragedy.

While the company’s new “safety first” culture will take

time to implement fully, there have been some notable

accomplishments since the accident.

Governance for safety and risk management.

Vale created its ‘Safety and Operational Excellence

Executive Office’ in 2019. It comprises 450 professionals

who take care of: Health and Safety and Operational Risks,

Operational Excellence, Asset Management and

Geotechnical Structures. This office is led by Carlos

Medeiros, an Executive Vice-President who reports

directly to the CEO.

Health & Safety

Vale has reduced its injury frequency rate by 37% since

2018 and was one of the top two players in the industry as

of 2020. High potential recordable injuries have also been

trending down, and Vale expects to reach zero by 2025.

Corporate Governance

In 2021, the board underwent significant changes as the

company moved to an improved corporate structure.

Now eight out of twelve board members are independent,

and the role of Chairman, currently filled by Jose Luciano

Duarte Penido, is also independent for the first time.

We have heard management say several times over the

last few years that Vale is fully committed to shifting the

Investment and ESG Case Studies

Continued

Murray International Trust PLC 27

mindset of its employees to "safety first". While the past

cannot be changed, we do see meaningful change taking

place. Vale was perceived as a company obsessed with

operational performance before the accident, but safety

does seem to have become the number one priority. The

company has accepted lower production figures during

the last three years while getting its house in order. The

Manager has met with representatives of the company

over thirty times since the accident, pressing for and

monitoring the progress of improvements in key areas.

We will continue to do so going forward.

Telus Case Study

The Company first invested in Canadian telecoms

operator Telus in 2013. The initial thesis focused on the

significant market shares that Canada's three major

incumbents, Telus, Rogers and Bell enjoy. The competitive

environment had been relatively benign until that point,

allowing the big three players to generate solid cash flows

and pay attractive dividends. The Canadian telecom

market was also seeing tailwinds such as wireless and

wireline convergence, where operators blend the two

network types, making connectivity more ubiquitous and

where Canadian telecom operators have been very

successful. In addition, Canada's higher population growth

rate relative to G7 nations and, at the time, lower wireless

penetration rates provided additional longer term

structural tailwinds.

On the surface, the Canadian telecom market appears

similar to other Western markets in structure, competitive

strategy and underlying trends. Canada has three major

incumbents in wireless, Telus, Rogers and Bell, with some

challengers nipping at the heels. The market has seen

average revenue per user (ARPU) erosion due to unlimited

pricing plans and device financing while experiencing

accelerating broadband pricing growth. Structurally, the

Canadian market is small relative to other developed

markets, with around 15 million households versus about

129 million in the US. Its population of circa 38 million

people makes Canada roughly the same size as California

in terms of the addressable market size. However, the

market is much more concentrated than the US in terms

of population density. While Canada is a vast country with

ten provinces and three territories, Ontario, Quebec,

Alberta, and British Columbia account for 87% of the

overall population and GDP. The top 5 metro areas of

Toronto, Montreal, Vancouver, Calgary and Ottawa

account for 43% of the Canadian population. By

comparison, the top 5 metro areas in the US accounts for

around 17% of the population. This is one of the reasons

why, despite Canada's land area being comparable to the

US, Canada only requires approximately 13,000 cell

towers vs about 340,000 sites in the US.

This thesis has largely played out as hoped over the years,

and many of the drivers still remain relevant for the stock

today. While regulatory environment in Canada tends to

be more onerous than in other markets, there still appears

to be a more stable regime in place. Furthermore, the

quality of execution at those smaller operators seeking to

be competitively disruptive has been lacking, resulting in

the major incumbents seeing less operating pressure to

date than has been the case in other markets such as the

US.

Also, despite the regulatory environment, Canadian

distributors still have some of the highest ARPUs in the

Developed World. While the regulatory framework

remains an ongoing risk for the sector in Canada, of which

we should remain mindful, we believe this is likely to be less

of a terminal value risk even in the worst-case scenario, i.e.

wholesale access at regulated rates. This is because the

size of the market is too small and regulatory risk too

significant to attract global majors. At the same time, the

scale difference between the incumbents and new

entrants is too substantial for the latter to create sustained

long term pressure. The majors looked to cement their

position even further when Canada held a 3500MHz

spectrum auction, key for 5G networks, in 2021. This

generated a record C$8.9 billion, with the top three firms

accounting for around 80% of that. In addition, unlike other

parts of the world, Canadian operators control a vast

majority of their infrastructure instead of relying on third

parties such as tower companies and data centre

operators. This creates significant entry barriers for

infrastructure-based entrants.

At their most recent results, Telus offered better than

expected revenue and earnings guidance for 2022. There

is also an expectation of lower capital intensity from 2023

onwards, which should accelerate free cash flow

generation, allowing for even more attractive capital

returns as the business delevers. Telecommunication

companies are sometimes accused of being unexciting;

however, we still view Telus as a business with attractive

assets and a solid strategy, which management should

continue to execute on well.

28 Murray International Trust PLC

The Board uses a number of financial and operating performance measures to assess the Company’s success in

achieving its investment objective and to determine the progress of the Company in pursuing its investment policy. The

main KPIs (refer to glossary on page 112 for definition) identified by the Board in relation to the Company which are

considered at each Board meeting are as follows:

KPI Description

Dividend Absolute Growth: The Board’s aim is to seek to increase the Company’s revenues

over time in order to maintain an above average dividend yield. Dividends paid over

the past 10 years are set out on page 29 with a graph showing dividend growth

against inflation on page 30.

Relative Yield: The Board also measures NAV total return performance against the

Reference Index and performance relative to investment trusts within the

Company’s peer group over a range of time periods, taking into consideration the

differing investment policies and objectives employed by those companies.

NAV Performance Absolute Performance: The Board considers the Company’s NAV total return figures

to be the best indicators of performance over time and these are therefore the main

indicators of performance used by the Board.

Relative Performance: The Board also measures NAV total return performance

against the Reference Index and performance relative to investment trusts within

the Company’s peer group over a range of time periods, taking into consideration

the differing investment policies and objectives employed by those companies.

A graph showing the NAV and Reference Index total returns is shown on page 30.

Share Price Performance Absolute Performance: The Board monitors the share price absolute return.

Relative Performance: The Board also monitors the price at which the Company’s

shares trade relative to the Reference Index on a total return basis over time

A graph showing absolute, relative and share price performance is shown on page

30 and further commentary on the performance of the Company is contained in the

Chairman’s Statement and Investment Manager’s Review.

Share Price Discount/

Premium to NAV

The discount/premium relative to the NAV per share represented by the share price

is closely monitored by the Board. The objective is to avoid large fluctuations in the

discount/premium by the use of share buybacks and the issuance of new shares or

the sale of Treasury shares, subject to market conditions. A graph showing the share

price premium/(discount) relative to the NAV is shown on page 30.

Gearing The Board’s aim is to ensure that gearing as a percentage of NAV is kept within the

Board’s guidelines issued to the Manager as disclosed on page 31.

Competitive Ongoing Charges

Ratio

Absolute Performance: The Board monitors the longer term trend of the Company’s

OCR in absolute terms

Relative Performance: the Board also monitors the relative trend of the OCR versus

the Company’s peer group, taking into consideration the differing investment

policies and objectives employed by those companies.

Key Performance Indicators

(

KPIs

)

Murray International Trust PLC 29

In accordance with the investment objective, the Company’s performance is measured over the long term and

annualised data covering the last ten years is presented below.

Total Return

1 year 3 year 5 year 10 year

% return % return % return % return

Share price

+7.2 +18.3 +22.4 +96.8

Net asset value per Ordinary share

+14.1 +29.3 +37.2 +118.0

UK RPI +7.5 +11.2 +18.9 +32.7

Reference Index

+20.0 +55.5 +66.2 +211.2

Considered to be an Alternative Performance Measure (see page 104 for more details).

Mid to mid.

Reference Index comprising 60% FTSE World ex UK Index/40% FTSE World UK Index up to April 2020 and 100% FTSE All World TR Index from May 2020.

Source: abrdn, Morningstar & Lipper

Ten Year Financial Record

Year end 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Total revenue (£’000) 55,141 63,717 62,609 67,020 77,333 79,471 77,105 82,417 68,918 78,737

Per Ordinary share (p):

Net asset value 975.8 981.0 966.6 849.0 1,135.7 1,251.4 1,107.8 1,190.0 1,138.2 1,240.3

Share price 1,048.0 1,052.0 1,026.0 829.5 1,188.0 1,268.0 1,132.0 1,260.0 1,130.0 1,156.0

Net revenue return

39.8 43.8 40.8 45.7 51.2 51.8 49.6 54.1 46.6 51.7

Dividends

40.5 43.0 45.0 46.5 47.5 50.0 51.5 53.5 54.5 55.0

Dividend cover 0.99x 1.03x 0.91x 0.99x 1.08x 1.04x 0.96x 1.01x 0.86x 0.94x

Revenue reserves

(£’000)

64,631 68,120 64,690 64,767 70,963 75,252 73,563 75,747 66,764 62,967

Shareholders’ funds

(£’000)

1,192,243 1,236,718 1,240,537 1,091,019 1,447,879 1,599,129 1,419,588 1,539,055 1,461,827 1,561,066

Net revenue return per Ordinary share has been based on the average Ordinary share capital during each year (see note 9 on page 87).

The figure for dividends per share reflects the years to which their declaration relates and not the years they were paid.

Performance Track Record

30 Murray International Trust PLC

Share Price (Discount)/Premium to NAV (%)

Ten years to 31 December 2021

-10

-8

-6

-4

-2

2011 2012 2013 2014 2015 20 16 20 17 2018 20 19 2020 2021

Net Asset Value and Share Price Total Return rebased to 100 (with net dividends reinvested)

Ten years to 31 December 2021

100

150

200

250

300

350

2011 2012 2013 2014 20 15 2016 2017 2018 20 19 2020 2021

Share Price

NAV

UK RPI

Reference Index

Comparison of Net Asset Value Total Return and Dividend Growth to Inflation

(figures rebased to 100)

Ten years to 31 December 2021

100

120

140

160

180

200

220

2011 2012 2013 2014 2015 20 16 2017 2018 2019 2020 2021

MINT NAV total return

(CAGR 8.1%)

MINT dividend growth

(CAGR 4.0%)

UK RPI (average 3.3%)

* Long Term means the average of the last ten years

Performance Track Record

Continued

NAV Total

Return 2021

XX%

Long Term*

Dividend Growth

4.0% p.a.

Long Term*

NAV Return

8.1% p.a

Long Term*

UK RPI

3.3% p.a

Murray International Trust PLC 31

Investment trusts, such as the Company, are long-term

investment vehicles. Typically, investment trusts are

externally managed, have no employees, and are

overseen by an independent non-executive board of

directors. Your Company’s Board of Directors sets the

investment mandate, monitors the performance of all

service providers (including the Manager) and is

responsible for reviewing strategy on a regular basis. All

this is done with the aim of preserving and enhancing

shareholder value over the longer term.

Investment Objective

The aim of the Company is to achieve an above average

dividend yield, with long-term growth in dividends and

capital ahead of inflation, by investing principally in global

equities.

Investment Policy

There are a number of elements set out in the investment

policy delegated to the Manager which are set out below.

Asset Allocation

The Company’s assets are currently invested in a

diversified portfolio of international equities and fixed

income securities spread across a range of industries and

economies. The Company’s investment policy is flexible

and it may, from time to time, hold other securities

including (but not limited to) index-linked securities,

convertible securities, preference shares, unlisted

securities, depositary receipts and other equity-related

securities. The Company may invest in derivatives for the

purposes of efficient portfolio management in the

furtherance of its investment objective.

The Company’s investment policy does not impose any

geographical, sectoral or industrial constraints upon the

Manager. The Board has set guidelines which the

Manager is required to work within. It is the investment

policy of the Company to invest no more than 15% of its

gross assets in other listed investment companies

(including listed investment trusts), at the time of

purchase. The Company currently does not have any

investments in other investment companies. The

Manager is authorised to enter into stocklending contracts

and the Company plans to undertake limited stocklending

activity in the future following the completion of the

administrative set-up process.

Risk Diversification

The Manager actively monitors the Company’s portfolio

and attempts to mitigate risk primarily through

diversification. The Company is permitted to invest up to

15% of its investments by value in any single holding (at the

time of purchase) although, typically, individual

investments do not exceed 5% of the total portfolio.

Gearing

The Board considers that returns to shareholders can be

enhanced by the judicious use of borrowing. The Board is

responsible for the level of gearing in the Company and

reviews the position on a regular basis. Any borrowing,

except for short-term liquidity purposes, is used for

investment purposes or to fund the purchase of the

Company’s own shares.

Total gearing will not in normal circumstances exceed

30% of net assets with cash deposits netted against the

level of borrowings. At the year end, there was net gearing

of 12.2% (calculated in accordance with Association of

Investment Companies guidance). Particular care is

taken to ensure that any bank covenants permit

maximum flexibility in investment policy.

Changes to Investment Policy

Any material change to the investment policy will require

the approval of the shareholders by way of an ordinary

resolution at a general meeting.

Investment Objective and Investment Policy

32 Murray International Trust PLC

Introduction

The purpose of the Company, which is in its 116

year, is to

act as a vehicle to provide, over time, financial returns

(both income and capital) to its shareholders. The

Company’s investment objective is disclosed on page 31.

The activities of the Company are overseen by the Board

of Directors of the Company.

The Board is required to describe to the Company’s

shareholders how the Directors have discharged their

duties and responsibilities over the course of the financial

year under section 172 (1) of the Companies Act 2006

(the “s172 Statement”). This s172 Statement, from

‘Introduction’ on page 32 to “The Work of the Board and its

Principal Decisions” on page 36, provides an explanation of

how the Directors have promoted the success of the

Company for the benefit of its members as a whole, taking

into account the likely long-term consequences of

decisions, the need to foster relationships with all

stakeholders and the impact of the Company’s operations

on the environment.

Our Culture

The Board seeks to ensure that the Company and the

Board operate with a transparent culture where all parties

are treated with respect and are provided with the

opportunity to offer practical challenge and participate in

constructive debate which is focused on achieving the

expectations of shareholders and other stakeholders. The

Board reviews the culture and manner in which the

Manager operates at its regular meetings and receives

regular reporting and feedback from the other key service

providers.

Our Business Model

The mechanics of how the Company operates are set out below. These mechanics, which have evolved over time, are

designed to protect shareholders’ interests:

Company Policies

Environmental, Social and Human Rights Issues

The Company has no employees as the Board has

delegated day-to-day management and administrative

functions to Aberdeen Standard Fund Managers Limited.

There are, therefore, no disclosures to be made in respect

of employees. The Company’s socially responsible

investment policy is outlined below and on page 60.

Due to the nature of the Company’s business, being a

Company that does not offer goods and services to

customers, the Board considers that it is not within the

scope of the Modern Slavery Act 2015 because it has no

turnover. The Company, therefore, is not required to

make a slavery and human trafficking statement.

Promotin

Your Company’s Success

Murray International Trust PLC 33

Marketing and Promotional Policy

The Board recognises the importance of communicating

the long-term attractions of your Company to current and

prospective investors both for improving liquidity and for

enhancing the value and rating of the Company’s shares.

The Board believes an 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 companies under its

management. The Company also supports the Manager’s

investor relations programme which involves regional

roadshows, promotional and public relations campaigns.

The Company’s financial contribution to these

programmes is matched by the Manager. The Manager

reports at least quarterly to the Board providing an

analysis of the promotional activities as well as updates on

the shareholder register and any changes in the make up

of that register.

Global Greenhouse Gas Emissions

The Company 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. It is therefore

deemed to be a low user (<40MWH/year) and exempt

from Streamlined Energy and Carbon Reporting

obligations.

Socially Responsible Investment Policy

The Company supports the UK’s Stewardship Code, and

seeks to play its role in supporting good stewardship of the

companies in which it invests. While the 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.

Further details on stewardship may be found on pages 10

and 60.

Board Diversity Policy

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 the Board to

fulfil its obligations. The Board also recognises the benefits

and is supportive of the principle of diversity in its

recruitment of new Board members. The Board will not

display any bias for age, gender, race, sexual orientation,

religion, ethnic or national origins, or disability in

considering the appointment of its Directors. However, the

Board will continue to ensure that all appointments are

made on the basis of merit against the specification

prepared for each appointment and, therefore, the

Company does not consider it appropriate to set diversity

targets. At 31 December 2021, there were two male

Directors and two female Directors on the Board.

Our Engagement with Stakeholders

The diagram below illustrates the relationship with the Company and its key stakeholders.

34 Murray International Trust PLC

Shareholders

Shareholders are key stakeholders in the Company – they look to the Manager to achieve the investment objective over

time and to deliver a regular growing income together with some capital growth. Therefore the Directors place a great

deal of importance on communication with shareholders and the table below provides further details on the various

methods of interaction. The Board’s policy is to communicate directly with shareholders and their representative bodies

without the involvement of the abrdn Group (either the Company Secretary or the Manager) in situations where direct

communication is required and usually a representative from the Board meets with major shareholders on an annual

basis in order to gauge their views.

The following table describes some of the ways we engage with our shareholders:

AGM Ordinarily the AGM provides an opportunity for the Directors to engage with

shareholders, answer their questions and meet them informally. The next AGM is

scheduled for 22 April 2022 in London. Subject to any developments in respect of

the Covid pandemic, the Board very much hopes to be able to hold a normal in-

person AGM followed by refreshments and an opportunity for shareholders to

meet the Directors.

Online Shareholder Presentation Following the success of the Online Shareholder Presentation in 2021, the Board

has decided to hold another Online Shareholder Presentation in 2022 at 11.00 a.m.

on Thursday 7 April 2022 and shareholders are encouraged to register and attend,

whether they are planning to attend the AGM or not.

Annual and Half Yearly Reports We publish a full Annual Report in March/April each year that contains a strategic

report, governance section, financial statements and additional information; we

also publish a Half Yearly Report each August/September. The reports are

available on the Company’s website and in paper format and widely distributed to

parties who have an interest in the Company’s performance.

Company Announcements We release a full set of financial results at the half year and full year stage. We also

issue announcements for all substantive news relating to the Company.

Shareholders can find these announcements on the Company’s website. Updated

net asset value figures are announced on a daily basis.

Monthly Factsheets The Manager publishes monthly factsheets on the Company’s website including

commentary on portfolio and market performance.

Website Our website contains a range of information on the Company and includes up to

date performance information as well as a full monthly portfolio listing of our

investments. Details of financial results, the investment process and Manager

together with Company announcements and contact details can be found here:

murray-intl.co.uk.

Other Shareholder Engagement We seek regular engagement with the Company’s major shareholders and also

prospective shareholders through annual and interim roadshow meetings

undertaken in conjunction with the Manager and Broker. Such regular meetings

may take the form of joint presentations with the Investment Manager or meetings

directly with a Director where any matters of concern may be raised directly in

order to understand their views on governance and performance. In addition, the

management team present at brokers’ conferences and regularly conduct

webcasts and webinars, some of which are available on the Company’s website.

Correspondence The Board welcomes queries from shareholders and responds to letters and

emails from shareholders on a range of issues.

Promotin

Your Company’s Success

Continued

Murray International Trust PLC 35

The Manager

The key service provider for the Company is the

Alternative Investment Fund Manager. The performance

of the Manager is reviewed in detail at each Board

meeting. The Manager’s investment process is outlined on

pages 19 and 106 and further information on the Board’s

oversight of, and engagement with, the Manager is

provided below and on page 56.

Other Service Providers

The other key stakeholder group is that of the Company’s

other third party service providers. The Board is

responsible for selecting the most appropriate outsourced

service providers and monitoring the relationships with

these suppliers regularly in order to review their

performance and ensure a constructive working

relationship. Our service providers look to the Company to

provide them with a clear understanding of the

Company’s needs in order that those requirements can

be delivered efficiently and fairly. The Board, in

conjunction with the Management Engagement

Committee, ensures that the arrangements with service

providers are reviewed at least annually in detail including

consideration of complaints. The aim is to ensure that

contractual arrangements are good value for money,

remain in line with best practice, services being offered

meet the requirements and needs of the Company and

performance is in line with the expectations of the Board,

Manager and other relevant stakeholders. Reviews

include those of the Company’s depositary and custodian,

share registrar and broker. The Audit and Risk Committee

reviews the terms of engagement of the auditor.

The Work of the Board and its Principal

Decisions

Pursuant to the Board’s aim of promoting the long-term

success of the Company, the Directors have undertaken

the following work and taken the following principal

decisions during the year:

Pathway to a Fully Covered Dividend

The Board aims to ensure that dividends received each

year from portfolio companies are sufficient to cover the

Company’s annual dividend payment to shareholders.

The Covid-19 pandemic caused significant uncertainty

and impacted the level of dividends paid out by portfolio

companies and so the Board took the decision in 2020 and

again in 2021 to use revenue reserves to top up earnings

and to allow the Company to continue to grow its

dividends in line with the investment objective. To give the

Board as much clarity as possible regarding the path to a

fully covered dividend, the Manager has prepared for the

Board a detailed three year “bottom up” analysis of the

earnings and dividend prospects for each individual

holding which is updated periodically and monitored by

the Board.

Dividend

The Board’s aim is to continue to pay a rising dividend. As

in 2020, three interim dividends of 12.0p per share have

been declared during the year. The Board is

recommending an increased final dividend of 19.0p per

share (2020: 18.5p). This is covered 0.94x by revenue

income for the year and illustrates the progress made to

date in the pathway to a fully covered dividend as

described above.

Improvement in Capital Performance

The Board monitors the Manager’s delivery of the

investment objective through, amongst other things,

reviewing the portfolio’s performance at every Board

meeting. The Board has challenged the Manager to

identify new dividend paying investment opportunities

that also have attractive growth prospects ; the aim being

to improve the capital element of the total return

performance. The Board recognises the dual requirement

to deliver both income and capital growth for the

Company’s shareholders. Changes in the portfolio are

referred to in the Investment Manager’s Review.

ESG and Climate Change

The Board’s responsibility for overseeing the work of the

Manager is not limited solely to investment performance.

The Board also has regard to environmental, social and

governance matters that subsist within the portfolio

companies. The Board has conducted regular meetings

with the Manager and is supportive of the Manager’s pro-

active approach to ESG and climate change engagement

to foster better societal outcomes from, and sustainable

business models for, investee companies. At the Board’s

request, the Manager has continued to improve the

quality and content of its ESG and associated reporting to

the Board and discussions have taken place on how to

improve communication in this area to shareholders and

the wider public. During the year, the MSCI ESG rating of

the portfolio has improved from ‘A’ to ‘AA’. The Board has

reaffirmed its decision not to impose specific exclusion

criteria within the Manager’s mandate.

Cost Control and OCR

The Board is responsible for controlling the level of costs

borne by the Company. During the year, the OCR has

reduced from 0.68% to 0.59%. Additionally, the Board has

36 Murray International Trust PLC

successfully negotiated a reduced investment

management fee which became effective from 1 January

2022 resulting in a reduction in the level of management

fee. This is expected to result in an annualised cost saving

of approximately £750,000 (based upon the current asset

base) and should serve to improve further the OCR in

future years.

Gearing

The use of gearing is a distinguishing feature of investment

trusts and allows the Company to use borrowings to

enhance shareholder returns over the longer term. In May

2021, following a detailed Board review of gearing options

available, the Company extended part of the Company's

long-term borrowings through the issuance of a £50

million 10 year Senior Unsecured Loan Note (the "Loan

Note") at an annualised interest rate of 2.24%. The

Company used the proceeds of the Loan Note to repay,

and cancel in full, the Company's £50 million Revolving

Credit Facility, which expired at that time. The new long-

term arrangement will provide the Company with

certainty in a rising interest rate environment and, in a

rising equity market, will enhance Company returns in a

cost effective manner.

Share Buybacks

During the year, the Board has continued to review the

trading in the Company’s shares and has regularly bought

back Ordinary shares at times when the number of sellers

has exceeded the number of buyers. The aim of the

buybacks is to ensure that the discount to NAV does not

become excessive compared amongst other things to the

peer group, and to provide further liquidity to the market

when it is beneficial to do so. During 2021, 2.5m shares

were acquired at a cost of £28.9m.

Directorate

The Board believes that shareholders’ interests are best

served by ensuring a smooth and orderly refreshment of

the Board, and it has a long-term succession programme

in place. This provides continuity and maintains the

Board’s open and collegiate style whilst ensuring a

diversity of thought backgrounds and experience.

Following the death of Simon Fraser in August 2021, Mr

Hardie was initially appointed as interim Chairman and the

Board undertook a review of its composition and future

requirements, appointing Mr Hardie as Chairman in

October 2021. Ms Mackesy was appointed Senior

Independent Director and Remuneration Committee

Chairman in August 2021. An exercise is underway to find

a new independent non-executive Director and

shareholders will be updated when this process has been

completed.

Shareholder Engagement

Given the death of Simon Fraser, the Board decided to

seek to engage with major shareholders and the

Chairman, in conjunction with the Senior Independent

Director, conducted a number of meetings during the

year in order to explain plans to refresh the Board and to

understand any concerns or issues they may have on this

or other issues.

After a period when capital returns in particular have

lagged the Company's peers, we also engaged with

shareholders during the year to update them on the

Board's continued engagement with the Manager about

this issue.

Continuing appointment of the Manager

It is the Board’s duty to shareholders to ensure that the

Investment Manager delivers on the investment objective.

After a period where capital returns in particular have

lagged peers, the Board has engaged with abrdn

intensively over the year a) to understand fully the reasons

for lagging capital returns and b) to encourage a more

balanced focus on both the capital as well as income

competitiveness of the Company. The continuing

appointment of the Manager is formally reviewed

annually at the Management Engagement Committee

(MEC) which the MEC has confirmed on the same terms

subject to the agreed management fee reduction.

Continued

Promotin

Your Company’s Success

Murray International Trust PLC 37

The Board is responsible for setting and monitoring policies designed to manage risk and to ensure the long term viability

of the Company.

Risk Management

There are a number of risks which, if realised, could have a

material adverse effect on the Company and its financial

condition, performance and prospects. A summary of the

principal risks is set out below, together with a description

of the mitigating actions taken by the Board. The principal

risks associated with an investment in the Company’s

shares are published monthly on the Company’s fact

sheet and can also be found in the pre-investment

disclosure document (“PIDD”) published by the Manager,

both of which are available on the Company’s website.

The Board regularly undertakes a robust review of the

principal risks and uncertainties facing the Company,

including those that would threaten its business model,

future performance, solvency or liquidity. The Board

collectively discusses with the Manager areas where there

may be risks emerging and maintains a register of these.

Examples of emerging risks which the Board is monitoring

include: the potential for Scottish independence;

geopolitical tensions and realignment of trading

relationships; and the evolution of post-Covid business

models and societal changes. In the event that an

emerging risk has gained significant weight or

importance, that risk is categorised and added to the

Company’s risk register and is monitored accordingly. In

addition the Manager operates a ‘three lines of defence’

model over its activities with the abrdn business units

responsible for adhering to applicable rules and

regulations; the compliance team is then responsible for

checking that the rules are being followed and then

internal audit is responsible for independently reviewing

these arrangements.

The Board has kept the on-going risks related to the

Covid-19 pandemic and the impact of the UK leaving the

EU (“Brexit”) to the Company’s investment portfolio and its

operations under review.

The influence of the pandemic on stock markets and

wider societal trends will continue to be seen for some

time to come as different regions of the world move at

different speeds into an endemic, rather than pandemic,

phase of Covid-19. The consequential uncertainty around

areas such as disrupted supply chains, changes in

demand for products and services, and labour market

constraints may then impact the value of the Company’s

investments or the level of their future dividend payments.

However, the Board notes the Manager’s robust and

disciplined investment process, which continues to focus

on long-term company fundamentals including balance

sheet strength and deliverability of sustainable earnings

growth, as further described in the Investment Manager’s

Review on page 14.

Many of the Company’s third-party service providers,

including the Manager, are likely to continue operating

with some form of hybrid working practices. The Board,

through the Manager, continues to monitor all third-party

service arrangements closely and is pleased to report that

it has not to date seen any reduction in the level of service

provided to the Company.

Since the expiry of the transition period for the UK leaving

the EU (“Brexit”) on 1 January 2021, the Board does not

believe there has been a significant impact on either the

Company’s investment portfolio or its operations, but will

continue to monitor any longer-term impacts.

The design, implementation and maintenance of controls

and procedures to safeguard the assets of the Company

and to manage its affairs properly extends to operational

and compliance controls and risk management. Further

information about the Company’s internal controls is

included in the Directors’ Report on pages 58 and 59.

The Board has prepared its own risk register which

identifies potential risks relating to strategy, investment

management, shareholders, marketing, gearing,

regulatory and financial obligations, third party service

providers and the Board. The Board considers the

potential cause and possible impact of these risks as well

as reviewing the controls in place to mitigate these

potential risks. A risk is rated by having a likelihood and an

impact rating and the residual risk is plotted on a “heat

map” and is reviewed at least twice a year.

Significant matters relating to the work of the Audit and

Risk Committee are discussed in the Report of the Audit

and Risk Committee on page 65 and further detail on

financial risks and risk management is disclosed in note 18

to the financial statements. In all other respects, the

Company’s principal risks and uncertainties have not

changed materially since the date of the Annual Report

and are not expected to change materially for the current

financial year.

Risk Mana

ement and Viability

38 Murray International Trust PLC

Principal Risks

Trend

Mitigating Action

Investment strategy and objectives – if the

Company’s investment objective becomes

unattractive and the Company fails to

adapt to changes in investor demand

(including in relation to ESG and climate

change) the Company may become

unattractive to investors, leading to

decreased demand for its shares and a

widening discount.

The Board keeps the level of discount and/or premium at

which the Company’s shares trade as well as the investment

objective and policy under review. The Board holds an annual

strategy meeting where it reviews updates from the Manager

and investor relations reports, and the Broker reports on the

market. In addition, the Board is updated at each Board

meeting on the make up of and any movements in the

shareholder register. The Directors attend meetings with, and

respond to correspondence from, shareholders to keep

abreast of investor opinion.

Investment Portfolio Performance Risk

– if

the longer-term performance of the

investment portfolio does not deliver

income and/or capital returns in line with

the investment objective and/or

consistently underperforms market

expectations, the Company may become

unattractive to investors leading to

decreased demand for its shares and a

widening discount.

The Board reviews the investment portfolio performance at

each Board meeting and, amongst other things, seeks

explanations from the Manager where performance deviates

from expectations on either an absolute or relative basis. In

addition, the Directors attend meetings with, and respond to

correspondence from, shareholders to keep abreast of

investor opinion. The Board considers the Manager’s

appointment annually at the Management Engagement

Committee meeting where performance is comprehensively

reviewed alongside other metrics relevant to reappointment.

Operational Risks – the Company is

dependent on third parties (and the abrdn

Group in particular) for the provision of all

services and systems. Any fraud, control

failures, cyber threats, business continuity

issues at, or poor service from, these third

parties could result in financial loss or

reputational damage to the Company.

The Board receives reports from the Manager on internal

controls and risk management at each Board meeting. It

receives assurances from all its significant service providers

including the depositary, as well as back to back assurance

from the Manager at least annually. Further details of the

internal controls which are in place are set out in the

Directors’ Report on pages 58 and 59.

Financial Risks – the level of the Company’s

gearing, if inappropriate, and the financial

risks associated with the portfolio, including

the impact of movements in foreign

currency exchange rates, could result in

capital losses and/or reduced income for

the Company.

The Board sets a gearing limit and receives regular updates

on the actual gearing levels the Company has reached from

the Manager together with the assets and liabilities of the

Company and reviews these at each Board meeting. In

addition, ASFML, as Alternative Investment Fund Manager, in

conjunction with the Board, has set an overall leverage limit

of 2.0x on a commitment basis (2.5x on a gross notional

basis) and provides regular updates to the Board (see page

111).

The financial risks associated with the Company include

market risk, liquidity risk and credit risk, all of which are

mitigated in conjunction with the Manager. Further details of

the steps taken to mitigate the financial risks associated with

the portfolio are set out in note 18 to the financial statements.

Risk Mana

ement and Viability

Continued

Murray International Trust PLC 39

Viability Statement

The Company does not have a fixed period strategic plan

but the Board formally considers risks and strategy at

least annually. The Board considers the Company, with no

fixed life, to be a long-term investment vehicle but, for the

purposes of this viability statement, has decided that a

period of five years is an appropriate period over which to

report. The Board considers that this 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 considered the operational

resilience of the Company including the regular updates

and reporting received from the Manager and have

focused upon the following factors:

· The principal and emerging risks detailed in the

Strategic Report on pages 37 to 39;

· The ongoing relevance of the Company’s investment

objective in the current environment;

· The demand for the Company’s shares evidenced by

the historical level of premium and/or discount;

· The level of income generated by the Company;

· The need to ensure that that the Manager and the

Company’s other third party service providers have

suitable processes and controls in place to enable them

to continue to provide their services to the Company

within the context of the ongoing Covid-19 pandemic;

· The liquidity of the Company’s portfolio - over 91.5% of

the investments are categorised as level 1, held within

active markets and realisable within seven days; and

· The profile of the Company’s £200 million loan facilities

and Loan Notes which mature between May 2022 and

May 2031 and the ability of the Company to refinance or

repay the £60m facility that matures in May 2022.

Accordingly, taking into account the Company’s current

position, the fact that the Company’s investments are

mostly liquid 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 to meet its liabilities as they fall due for a

period of five years from the date of this Report. In making

this assessment, the Board has considered scenario

modelling prepared by the Manager which analysed the

impact of matters such as significant economic and stock

market volatility which could result in a substantial

reduction in the liquidity of the portfolio, changes in

investor sentiment or a significant reduction in earnings

which could all have an impact on the assessment of the

Company’s prospects and viability in the future.

David Hardie

Chairman

3 March 2022

40 Murray International Trust PLC

Portfolio

The Company invests in Unilever a multinational consumer goods

company specialising in food, personal care and cleaning products

Murray International Trust PLC 41

The Company maintains a diversified

portfolio of investments. At the year

end, the Company’s portfolio

consisted of 51 equity and 20 bond

holdings. The Manager is authorised

by the Board to hold between 45 and

150 investments in the portfolio.

42 Murray International Trust PLC

As at 31 December 2021

Taiwan Semiconductor Manufacturing

GlobalWafers

Taiwan Semiconductor Manufacturing

is one of the largest integrated circuit

manufacturers in the world. The

company is involved in component

design, manufacturing, assembly,

testing and mass production of

integrated circuits.

The company specialises in

manufacturing silicon wafers for the

global semiconductor industry. The

company is vertically integrated, having

production capability for wafer slicing,

etching, diffusion and polishing. Finished

products are sold to all leading

technology companies worldwide.

Aeroporto del Sureste

Broadcom Corporation

Grupo Aeroporto del Sureste operates

airports in Mexico. The company holds

long-term concessions to manage

airports in leading tourist resorts and

major cities.

Broadcom designs, develops and

markets digital and analogue

semiconductors. The company offers

wireless components, storage

adaptors, networking processors,

switches, fibre optic modules and

optical sensors. Broadcom markets its

products worldwide.

CME Group

Philip Morris International

Based in Chicago, USA CME Group

operates a derivatives exchange that

trades futures contracts and options,

interest rates, stock indexes, foreign

exchange and commodities.

Spun out from the Altria Group in 2008,

Philip Morris International is one of the

world’s leading global tobacco

companies. It manufactures and sells

leading recognisable brands such as

Marlboro, Parliament and Virginia Slims.

Unilever

AbbVie

Unilever is a multinational consumer

goods group which is focused in the

areas of home care, beauty &

personal care and food products.

AbbVie Inc is a global pharmaceutical

company, producing a broad range of

drugs for use in speciality therapeutic

areas such as immunology, chronic

kidney disease, oncology and

neuroscience.

Samsung Electronics

Verizon Communications

Korean based Samsung Electronics

manufactures a wide range of

consumer and industrial electronic

equipment and products such as

semiconductors, computers, monitors,

peripherals, televisions and home

appliances. The company also has

significant global market share of the

mobile phone handsets and

telecommunication equipment.

Verizon Communications is an

integrated telecommunications

company based in New York that

provides wire line voice and data

services, wireless services, internet

services and published directory

information.

Ten Lar

est Investments

Murray International Trust PLC 43

Valuation Total Valuation

2021 assets

2020

Company Country £’000 % £’000

Taiwan Semiconductor Manufacturing Taiwan 82,058 4.7 82,638

GlobalWafers Taiwan 71,090 4.0 55,300

Aeroporto del Sureste Mexico 70,058 4.0 72,113

Broadcom Corporation USA 58,956 3.3 38,438

CME Group USA 57,349 3.3 45,256

Philip Morris International USA 49,097 2.8 42,360

Unilever

UK & Netherlands 45,390 2.6 24,401

AbbVie USA 44,985 2.5 31,316

Samsung Electronics Korea 44,298 2.5 48,868

Verizon Communications USA 38,362 2.2 42,942

Top ten investments 561,643 31.9

TotalEnergies France 37,471 2.1 31,597

Oversea-Chinese Bank Singapore 37,459 2.1 33,411

Cisco Systems USA 37,423 2.1 26,178

Tryg Denmark 35,496 2.0 20,747

Telus Canada 34,824 2.0 28,918

Atlas Copco Sweden 32,574 1.9 26,402

Pepsico USA 32,063 1.8 27,104

Epiroc Sweden 31,306 1.8 32,285

BHP Group Australia 30,786 1.8 26,950

Roche Holdings Switzerland 30,719 1.7 51,146

Top twenty investments 901,764 51.2

Taiwan Mobile Taiwan 30,688 1.7 29,612

British American Tobacco UK 30,041 1.7 29,788

Bristol-Myers Squibb USA 29,922 1.7 –

Sociedad Quimica Y Minera de Chile Chile 29,780 1.7 46,657

Hon Hai Precision Industry Taiwan 27,753 1.6 23,927

Vale do Rio Doce Brazil 27,540 1.6 32,664

Sanofi France 26,027 1.5 –

Zurich Insurance Switzerland 25,956 1.5 24,729

Nutrien Canada 25,291 1.4 16,025

Siam Commercial Bank Thailand 25,262 1.4 19,174

Top thirty investments 1,180,024 67.0

List of Investments

44 Murray International Trust PLC

List of Investments

Continued

Valuation Total Valuation

2021 assets

2020

Company Country £’000 % £’000

Johnson & Johnson USA 25,254 1.4 23,005

Telkom Indonesia Indonesia 25,114 1.4 20,681

TC Energy Canada 24,029 1.4 20,785

Enel Italy 23,660 1.3 18,520

Singapore Telecommunications Singapore 22,870 1.3 23,016

Nordea Bank Sweden 22,552 1.3 –

Kimberly Clark de Mexico Mexico 22,331 1.3 24,944

Royal Dutch Shell UK 22,065 1.3 17,128

China Resources Land China 21,743 1.2 21,217

Enbridge Canada 21,651 1.2 –

Top forty investments 1,411,293 80.1

Banco Bradesco Brazil 19,859 1.1 27,461

Ping An Insurance China 19,143 1.1 26,875

China Vanke China 18,875 1.1 –

Schlumberger USA 17,690 1.0 12,770

Telenor Norway 17,406 1.0 18,699

Castrol India India 17,061 1.0 17,164

Lotus Retail Growth Thailand 16,687 0.9 19,901

Republic of Indonesia 6.125% 15/05/28

Indonesia 15,799 0.9 15,746

MTN South Africa 15,794 0.9 5,995

Republic of South Africa 7% 28/02/31

South Africa 15,590 0.9 17,074

Top fifty investments 1,585,197 90.0

Telefonica Brasil Brazil 14,497 0.8 14,696

America Movil Sab De 6.45% 05/12/22

Mexico 14,235 0.8 14,901

United Mexican States 5.75% 05/03/26

Mexico 13,601 0.8 15,365

Petroleos Mexicanos 6.75% 21/09/47

Mexico 13,031 0.7 13,717

Indocement Tunggal Prakarsa Indonesia 12,432 0.7 15,048

Republic of Dominica 6.85% 27/01/45

Dominican Republic 12,191 0.7 13,350

Republic of Indonesia 8.375% 15/03/34

Indonesia 11,618 0.7 12,128

Vodafone Group UK 10,096 0.6 10,885

HDFC Bank 7.95% 21/09/26

India 7,928 0.5 8,209

Power Finance Corp 7.63% 14/08/26

India 7,825 0.4 7,922

Top sixty investments 1,702,651 96.7

Murray International Trust PLC 45

Valuation Total Valuation

2021 assets

2020

Company Country £’000 % £’000

Petroleos Mexicanos 5.5% 27/06/44

Mexico 7,275 0.4 7,519

Republic of Indonesia 10% 15/02/28

Indonesia 4,710 0.3 4,833

ICICI Bank 7.42% 27/06/24

India 4,646 0.3 4,782

Santander 10.375% Non Cum Pref

UK 4,025 0.2 3,680

General Accident 7.875% Cum Irred Pref

UK 3,612 0.2 3,808

Republic of Ecuador 0.5% 31/07/35

Ecuador 3,101 0.2 2,556

Republic of Turkey 9% 24/07/24

Turkey 3,061 0.2 6,544

Republic of Turkey 8% 12/03/25

Turkey 2,962 0.2 6,638

Republic of Ecuador 0.5% 31/07/30

Ecuador 2,372 0.1 1,833

Republic of Ecuador 0.5% 31/07/40

Ecuador 644 – 556

Top seventy investments 1,739,059 98.8

Republic of Ecuador 0.0% 31/07/30

Ecuador 253 – 212

Total investments

1,739,312 98.8

Net current assets

21,568 1.2

Total assets

1,760,880 100.0

Excluding bank loans.

The 2020 column denotes the Company’s holding at 31 December 2020.

The 2021 holding comprises UK and Netherlands securities, split £23,670,000 and £21,720,000 respectively.

Quoted preference share or bond.

See definition on page 113.

Summary of Net Assets

Valuation Valuation

31 December 2021 31 December 2020

£’000 % £’000 %

Equities 1,590,833 101.9 1,455,675 99.6

Preference shares 7,637 0.5 7,488 0.5

Bonds 140,842 9.0 183,242 12.6

Total investments 1,739,312 111.4 1,646,405 112.7

Net current assets 21,568 1.4 15,227 1.0

Total assets 1,760,880 112.8 1,661,632 113.7

Prior charges

(199,814) (12.8) (199,805) (13.7)

Net assets 1,561,066 100.0 1,461,827 100.0

See definition on page 113.

Sector/Geographical Analysis

46 Murray International Trust PLC

Asia

United North Europe Pacific Latin 2021 2020

Kingdom America ex UK ex Japan America Africa Total Total

Sector/Geographical Analysis % % % % % % % %

Energy 1.3 3.6 2.1 – – – 7.0 4.9

Oil Gas and Coal 1.3 3.6 2.1 – – – 7.0 4.9

Basic Materials – 1.4 – 2.7 3.3 – 7.4 8.4

Chemicals – 1.4 – 1.0 1.7 – 4.1 4.8

Industrial Metals and Mining – – – 1.7 1.6 – 3.3 3.6

Industrials – – 3.7 0.7 4.0 – 8.4 10.2

Construction & Materials – – – 0.7 – – 0.7 0.9

General industrials – – – – – – – 0.6

Industrial Engineering – – 3.7 – – – 3.7 3.5

Industrial Transportation – – – – 4.0 – 4.0 5.2

Consumer Staples 3.0 4.6 1.2 – 1.3 – 10.1 9.8

Beverages – 1.8 – – – – 1.8 1.6

Personal Care Drug and

Grocery Stores

1.3 – 1.2 – 1.3 – 3.8 3.0

Tobacco 1.7 2.8 – – – – 4.5 5.2

Health Care – 5.7 3.2 – – – 8.9 7.9

Pharmaceuticals &

Biotechnology

– 5.7 3.2 – – – 8.9 7.9

Telecommunications 0.6 6.3 1.0 5.2 – 0.9 14.0 13.5

Telecommunications Service

Providers

0.6 4.2 1.0 5.2 – 0.9 11.9 11.9

Telecommunications

Equipment

– 2.1 – – – – 2.1 1.6

Utilities – – 1.3 – – – 1.3 1.1

Electricity – – 1.3 – – – 1.3 1.1

Murray International Trust PLC 47

Asia

United North Europe Pacific Latin 2021 2020

Kingdom America ex UK ex Japan America Africa Total Total

Sector/Geographical Analysis % % % % % % % %

Financials – 3.3 4.8 4.6 1.1 – 13.8 12.8

Banks – – 1.3 3.5 1.1 – 5.9 5.8

Investment Banking and

Brokerage Services

– 3.3 – – – – 3.3 2.7

Life Insurance – – – 1.1 – – 1.1 1.6

Nonlife Insurance – – 3.5 – – – 3.5 2.7

Real Estate – – – 3.2 – – 3.2 2.5

Real Estate Investment and

Services

– – – 2.3 – – 2.3 1.3

Real Estate Investment Trusts – – – 0.9 – – 0.9 1.2

Technology – 3.4 – 12.8 – – 16.2 16.5

Technology Hardware &

Equipment

– 3.4 – 12.8 – – 16.2 16.5

Total equities 4.9 28.3 17.3 29.2 9.7 0.9 90.3 87.6

Preference shares and bonds 0.4 – 0.4 3.1 3.7 0.9 8.5 11.5

Total investments 5.3 28.3 17.7 32.3 13.4 1.8 98.8 99.1

Net current assets 1.2 0.9

Total assets

100.0 100.0

See definition on page 113.

Sector/Geographical Analysis

48 Murray International Trust PLC

Total Equities Distribution by Sector

0% 5% 10 % 15% 20%

Technology

Financials

Utilities

Telecommunications

Consumer Staples

Industrials

Basic Materials

Real Estate

Energy

2021

2020

Total Equities Distribution by Geographic Region

0% 5% 10% 15% 20% 25% 30% 35% 40%

Africa

Japan

United Kingdom

Europe ex UK

Latin America

North America

Asia Pacific ex Japan

2021

2020

Continued

Equities

Represent

90.3% of Net

Assets

51 Equity

Holdings

Portfolio

Turnover

12%

(2020: 16%)

Murray International Trust PLC 49

Equities by Country

Preference Shares and Bonds by Country

24.6%

13.3%

3.9%

5.8%

5.4%

2.4%

3.8%

3.6%

6.6%

5.4%

12.1%

10.2%

1.9%

1.0%

USA

Taiwan

Brazil

Mexico

Indonesia

Singapore

Switzerland

Canada

Sweden

Other Asia Pa

Other Europe

Chile

Japan

Africa

2021

8.2%

4.3%

13.7%

21.6%

32.4%

10.5%

4.1%

5.2%

Dominican R

Ecuador

India

Indonesia

Mexico

South Africa

Turkey

2021

21.6%

13.2%

5.1%

6.7%

6.9%

2.5%

3.9%

6.4%

4.5%

4.0%

12.3%

8.4%

3.2%

1.0%

0.4%

2020

7.0%

2.7%

19.2%

17.1%

34.1%

9.0%

6.9%

3.9%

2020

Bonds

Represent 8.5%

of Net Assets

2021 Year

End Equity

Exposure 102.5%

(2020: 98.8%)

20 Bond

Holdings

50 Murray International Trust PLC

Governance

The Company invests in GlobalWafers, a Taiwanese tech

manufacturing company and silicon wafer supplier

Murray International Trust PLC 51

The Company is committed to high

standards of corporate governance

and applies the principles identified

in the UK Corporate Governance

Code and the AIC Code of

Corporate Governance

52 Murray International Trust PLC

David Hardie

Chairman and Independent Non-Executive Director

Experience

David is a corporate lawyer by background and was

formerly a partner of UK law firm, Dundas & Wilson (now

part of CMS), where he was a partner for over 30 years

and where he held various positions including head of

corporate, managing partner and chairman. David is also

a non-executive chairman of WNL Investments Limited.

Length of Service:

He was appointed a Director on 1 May 2014

Last re-elected to the Board:

23 April 2021

Contribution:

The Nomination Committee has reviewed the contribution

of Mr Hardie in light of his forthcoming re-election at the

AGM to be held in April 2022 and has concluded that he

has assumed the role of Chairman with ease, leading the

Company with skill and expertise as well as continuing to

provide a wealth of legal experience and insight to the

Board’s deliberations through the year.

Committee membership:

Management Engagement Committee (Chairman) and

Nomination Committee (Chairman)

Employment by the Manager:

None

Other connections with Trust, Manager or other Directors:

None

Shareholding in Company:

15,643 Ordinary shares

Claire Binyon

Independent Non-Executive Director

Experience:

Claire is a chartered accountant who, following an early

career in the City, held senior corporate development and

strategic planning roles with global multinational

businesses including inBev, Cadbury, DS Smith and Fenner

(a Michelin group company). She is a non-executive

director of JPMorgan American Investment Trust PLC.

Length of service:

She was appointed a Director on 1 May 2018

Last re-elected to the board:

23 April 2021

Contribution:

The Nomination Committee has reviewed the contribution

of Ms Binyon in light of her forthcoming re-election at the

AGM in April 2022 and has concluded that Ms Binyon

continues to provide excellent global strategic and

financial insight to the Board as well as proficiently

chairing the Audit and Risk Committee with due focus on

the significant areas of accounting financial risk.

Committee membership:

Audit and Risk Committee (Chairman), Management

Engagement Committee, Nomination Committee and

Remuneration Committee.

Employment by the Manager:

None

Other connections with Trust, Manager or other Directors:

None

Shareholding in Company:

1,213 Ordinary shares

Board of Directors

Murray International Trust PLC 53

Alexandra Mackesy

Senior Independent Non-Executive Director

Experience:

Alexandra is a former equity analyst, having spent the

majority of her executive career in Asia with SBC Warburg,

JP Morgan and Credit Suisse. She has some 18 years of

experience as a director of UK listed investment trusts and

is currently chairman of JPMorgan China Growth &

Income trust plc and a non-executive director of The

Henderson Smaller Companies Trust plc. She is also a

director of Board Level Partners Ltd, which provides board

advisory services.

Length of Service:

She was appointed a Director on 1 May 2016

Last re-elected to the Board:

23 April 2021

Contribution:

The Nomination Committee has reviewed the contribution

of Mrs Mackesy in light of her forthcoming re-election at

the AGM to be held in April 2022 and concluded that she

has provided significant investment insight and investment

trust expertise to the Board during the year as well as

seamlessly assuming the role of chairman of the

Remuneration Committee.

Committee membership:

Audit and Risk Committee, Management Engagement

Committee, Nomination Committee and Remuneration

Committee (Chairman)

Employment by the Manager:

None

Other connections with Trust, Manager or other Directors:

None

Shareholding in Company:

975 Ordinary shares

Nicholas Melhuish

Independent Non-Executive Director

Experience:

Nicholas joined Corpus Christi College, Oxford as Fellow

and Bursar in 2018 following a portfolio management

career most recently as Head of Global Equities at Amundi

SA. He is a non executive director of JPMorgan

Claverhouse Investment Trust PLC, a trustee of the

Trusthouse Charitable Foundation and a director and

trustee of The London Clinic. He also lectures at the Saïd

Business School at Oxford University on Asset

Management.

Length of Service:

He was appointed a Director on 1 May 2021

Last re-elected to the Board:

Proposed election to the Board at the April 2022 AGM

Contribution:

The Nomination Committee has reviewed the contribution

of Mr Melhuish in light of his forthcoming election at the

AGM to be held in April 2022 and concluded that he has

already, in the short period of time since his appointment

to the board, delivered excellent global investment insight

and challenge.

Committee membership:

Audit and Risk Committee, Management Engagement

Committee, Nomination Committee and Remuneration

Committee

Employment by the Manager:

None

Other connections with Trust, Manager or other Directors:

None

Shareholding in Company:

2,563 Ordinary shares

54 Murray International Trust PLC

The Directors present their report and the audited

financial statements for the year ended

31 December 2021.

Results and Dividends

Details of the Company’s results and proposed dividends

are shown on pages 29 and 4 of this Report.

Investment Trust Status

The Company is registered as a public limited company

(registered in Scotland No. SC006705) and 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 January 2012.

The Directors are of the opinion that the Company has

conducted its affairs for the year ended 31 December

2021 so as to enable it to comply with the ongoing

requirements for investment trust status.

Individual Savings Accounts

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

The Company’s capital structure is summarised in note 14

to the financial statements. At 31 December 2021, there

were fully 125,861,856 paid Ordinary shares of 25p each

(2020 –128,438,662 Ordinary shares) in issue. At the year

end there were 3,550,147 Ordinary shares held in Treasury

(2020 – 973,341).

Share Buybacks

During the year 2,576,806 Ordinary shares were

purchased in the market for Treasury (2020 – 973,341).

Subsequent to the year end, a further 426,838 Ordinary

shares have been purchased for Treasury at a discount to

the prevailing NAV per share.

Share Rights

Ordinary shareholders are entitled to vote on all

resolutions which are proposed at general meetings of the

Company. The Ordinary shares carry a right to receive

dividends and 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.

Borrowings

In May 2021 the Company issued a £50 million 10 year

Senior Unsecured Loan Note (the "Loan Note") at an

annualised interest rate of 2.24%. The Loan Note is

unsecured, unlisted and denominated in sterling. The Loan

Note ranks pari passu with the Company's other

unsecured and unsubordinated financial indebtedness.

The Company used the proceeds of the Loan Note to

repay, and cancel in full, the Company's £50 million

Revolving Credit Facility with The Royal Bank of Scotland

International Limited, London Branch.

An additional £150 million is also available for drawdown

by the Company under the new Loan Note facility for a

five year period, with the Board's current intention to draw

this down only to repay any of the Company's existing

debt.

Management and Secretarial Arrangements

The Company has appointed Aberdeen Standard Fund

Managers Limited (“ASFML”), a wholly owned subsidiary of

abrdn plc, as its alternative investment fund manager

under the terms of an investment management

agreement dated 14 July 2014 (as amended). Under the

terms of the agreement, the Company’s portfolio is

managed by Aberdeen Asset Managers (“AAM”) by way

of a group delegation agreement in place between

ASFML and AAM. Investment management services are

provided to the Company by ASFML. Company

secretarial, accounting and administrative services have

been delegated by ASFML to Aberdeen Asset

Management PLC.

Up to 31 December 2021, the annual management fee

was charged on net assets (ie excluding borrowings for

investment purposes), averaged over the six previous

quarters (“Net Assets”) on the following tiered basis: 0.5%

of Net Assets up to £1,200m and 0.425% of Net Assets

above £1,200m.

With effect from 1 January 2022, the management fee is

charged at the rate of 0.5% per annum of Net Assets up to

£500m and 0.4% per annum of Net Assets above

£500m. Save for the aforementioned changes, all other

terms and conditions contained in the Company's

Management Agreement dated 14 July 2014 (as

amended)

remain unaltered.

A fee of 1.5% per annum remains chargeable on the value

of any unlisted investments. The investment management

fee is chargeable 30% against revenue and 70% against

realised capital reserves in line with the Board’s long-term

expectation of returns from revenue and capital. No fees

are charged in the case of investments managed or

Directors’ Report

Murray International Trust PLC 55

advised by the abrdn Group. The management

agreement may be terminated by either party on the

expiry of six months’ written notice. On termination, the

Manager would be entitled to receive fees which would

otherwise have been due up to that date.

The Board considers the continued appointment of the

Manager on the terms agreed to be in the interests of the

shareholders as a whole because the abrdn Group has

the investment management, secretarial, promotional

and administrative skills and expertise required for the

effective operation of the Company.

The Board

The Board currently consists of four non-executive

Directors.

The names and biographies of the current Directors are

disclosed on pages 52 and 53 indicating their range of

experience as well as length of service. Dr Carter and Ms

Campbell retired from the Board on 23 April 2021 and Mr

Fraser died on 9 August 2021 following a short illness.

The Directors will retire at the AGM in April 2022 and, with

the exception of Mr Melhuish, each Director will stand for

re-election (with Mr Melhuish standing for election).

The Board considers that there is a balance of skills and

experience within the Board relevant to the leadership

and direction of the Company and that all the Directors

contribute effectively. The reasons for the re-election,

where relevant, of the individual Directors are set out on

pages 52 and 53.

In common with most investment trusts, the Company has

no employees. Directors’ & Officers’ liability insurance

cover has been maintained throughout the year at the

expense of the Company. The Company’s Articles of

Association provide an indemnity to the Directors out of

the assets of the Company against any liability incurred in

defending proceedings or in connection with any

application to the Court in which relief is granted.

The Role of the Chairman and Senior

Independent Director

The Chairman 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

Chairman facilitates the effective contribution, and

encourages active engagement, by each Director. In

conjunction with the Company Secretary, the Chairman

ensures that Directors receive accurate, timely and clear

information to assist them with effective decision-making.

The Chairman leads the evaluation of the Board and

individual Directors, and acts upon the results of the

evaluation process by recognising strengths and

addressing any weaknesses. The Chairman also engages

with major shareholders and ensures that all Directors

understand shareholder views.

The Senior Independent Director acts as a sounding board

for the Chairman and acts as an intermediary for other

Directors, when necessary. Working closely with the

Nomination Committee, the Senior Independent Director

takes responsibility for an orderly succession process for

the Chairman, and leads the annual appraisal of the

Chairman’s performance. The Senior Independent

Director is also available to shareholders to discuss any

concerns they may have.

Management of Conflicts of Interest

No Director has a service contract with the Company

although Directors are issued with letters of appointment

upon appointment. The Directors’ interests in contractual

arrangements with the Company are as shown in note 21 to

the financial statements and the Directors’ Remuneration

Report. No Directors had any other interest in contracts with

the Company during the period or subsequently.

The Board has a procedure in place to deal with a

situation where a Director has a conflict of interest, as

required by the Companies Act 2006. As part of this

process, the Directors are required to disclose other

positions held and all other conflict situations that may

need to be authorised either in relation to the Director

concerned or his or 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 their wider

duties is affected. Each Director is required to notify the

Company Secretary of any potential or actual conflict

situations that will need authorising by the Board.

Authorisations given by the Board are reviewed at each

Board meeting. All proposed significant external

appointments are also required to be approved, in

advance, by the Chairman and then communicated to

other Directors for information.

The Company has a policy of conducting its business in an

honest and ethical manner. The Company takes a zero

tolerance approach to bribery and corruption and has

procedures in place that are proportionate to the

Company’s circumstances to prevent them. The Manager

also adopts a group-wide zero tolerance approach and

has its own detailed policy and procedures in place to

prevent bribery and corruption. Copies of the Manager’s

anti-bribery and corruption policies are available on its

website.

56 Murray International Trust PLC

In relation to the corporate offence of failing to prevent tax

evasion, it is the Company’s policy to conduct all 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 is committed to acting professionally, fairly

and with integrity in all its business dealings and

relationships.

Corporate Governance

The Corporate Governance Statement forms part of the

Directors’ Report. 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.

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

complied with the principles and provisions of the AIC

Code and the relevant provisions of the UK Code, except

as set out below.

The UK Code includes provisions relating to:

· interaction with the workforce (provisions 2, 5 and 6);

· the role and responsibility of the chief executive

(provisions 9 and 14);

· previous experience of the chairman of a remuneration

committee (provision 32); and

· executive directors’ remuneration (provisions 33 and 36

to 40).

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.

The full text of the Company’s Corporate Governance

Statement can be found on the Company’s website,

murray-intl.co.uk.

The table below details Directors’ attendance at

scheduled Board and Committee meetings held during

the year ended 31 December 2021 (with eligibility to

attend the relevant meeting in brackets). In addition there

were a number of other ad hoc Board meetings held

during the year.

Scheduled

Board

Audit

Com

Nom

Com

MEC Rem

Com

D Hardie

6 (6) 1 (1) 1 (1) 1 (1) n/a

C. Binyon 6 (6) 3 (3) 1 (1) 1 (1) 1 (1)

A Mackesy 6 (6) 3 (3) 1 (1) 1 (1) 1 (1)

N Melhuish

4 (4) 2 (2) n/a n/a 1 (1)

M Campbell

2 (2) 1 (1) n/a 1 (1) n/a

K J Carter

2 (2) n/a n/a n/a n/a

S Fraser

3 (3) 1 (1) n/a 1 (1) n/a

Mr Hardie was appointed interim Chairman in August 2021 and Chairman in

October 2021 and the Chairman is not a member of either the Audit and Risk

Committee or the Remuneration Committee but attended all Committee meetings by

invitation

Mr Melhuish was appointed to the Board on 1 May 2021

Dr Carter and Ms Campbell retired from the Board on 23 April 2021

Mr Fraser died on 9 August 2021

Board Committees

Terms of Reference

The terms of reference of all the Board Committees may

be found on the Company’s website murray-intl.co.uk and

copies are available from the Company Secretary upon

request. The terms of reference are reviewed and re-

assessed by the Board for their adequacy on an annual

basis.

Audit and Risk Committee

The Report of the Audit and Risk Committee is on pages 64

and 65 of this Annual Report.

Management Engagement Committee (“MEC”)

The MEC comprises all of the Directors. Mr Hardie is the

Chairman. The Committee reviews the performance of

the Manager and its compliance with the terms of the

management and secretarial agreement. The terms and

conditions of the Manager’s appointment, including an

evaluation of fees, are reviewed by the Committee on an

annual basis. The Committee believes that the continuing

appointment of the Manager on the terms that have been

agreed is in the interests of shareholders as a whole. The

Committee is also responsible for the oversight and

Directors’ Report

Continued

Murray International Trust PLC 57

annual review of all other key service provider

relationships.

Nomination Committee

All appointments to the Board of Directors are considered

by the Nomination Committee which comprises the entire

Board and is chaired by Mr Hardie. The Board’s overriding

priority in appointing new Directors to the Board is to

identify the candidate with the best range of skills and

experience to complement existing Directors. The Board

also recognises the benefits of diversity and its policy on

diversity is referred to in the Strategic Report on page 33.

When board positions become available as a result of

retirement or resignation, the Company ensures that a

diverse group of candidates is considered.

The Board’s policy on tenure is that continuity and

experience are considered to add significantly to the

strength of the Board. The Board also takes the view that

independence is not necessarily compromised by length

of tenure on the Board. However, in compliance with the

provisions of the AIC Code, it is expected that Directors will

serve in accordance with the time limits laid down by the

AIC Code. It is the policy of the Board that the Chairman

of the Company should retire once he or she has served

as a Director for nine years in line with current best

practice of the Financial Reporting Council. However there

could be circumstances where it might be appropriate to

ask a Chairman to stay on for a limited period and the

reasons for the extension will be fully explained to

shareholders and a timetable for the departure of the

Chairman clearly set out.

As part of its succession plans, the Company has initiated

a search for a new independent non-executive Director

using the services of an independent external recruitment

consultant that has no other connections with the

Company. A key requirement of the recruitment process

is to ensure the continuity of the Board’s open and

inclusive culture, policies and practices which are judged

to be essential to the future success of the Company. The

Company will update shareholders as soon as a new

appointment has been made.

The Committee has put in place the necessary

procedures to conduct, on an annual basis, an appraisal of

the Chairman of the Board, Directors’ individual self

evaluation and a performance evaluation of the Board as

a whole. An external evaluation was undertaken in 2018

by Stephenson & Co. an independent external board

evaluation service provider that does not have any other

connections with the Company. The 2021 external

evaluation was postponed following the death of Simon

Fraser and the next externally facilitated Board evaluation

is now scheduled to be completed during 2022. In 2021

questionnaires covering the Board, individual Directors, the

Chairman and the Audit and Risk Committee Chairman

were completed. The Chairman then met each Director

individually to review their responses and the Senior

Independent Director met the Chairman to provide

evaluation feedback. This evaluation highlighted certain

areas of further focus such as continuing professional

development as well as areas of focus for the current

recruitment process. Overall, the Committee has

concluded that the Board has a relevant balance of

experience and knowledge of investment markets, legal

regulation and financial accounting and continues to work

in a collegiate and effective manner.

In accordance with Principle 23 of the AIC’s Code of

Corporate Governance which recommends that all

directors of investment companies should be subject to

annual re-election by shareholders, all the members of

the Board, will retire at the forthcoming Annual General

Meeting and will offer themselves for re-election (with Mr

Melhuish offering himself for election). In conjunction with

the evaluation feedback, the Committee has reviewed

each of the proposed reappointments and concluded

that each of the Directors has the requisite high level and

range of business and financial experience and

recommends their re-election at the forthcoming AGM.

Details of the contributions provided by each Director

during the year are disclosed on pages 52 and 53.

Remuneration Committee

The level of fees payable to Directors is considered by the

Remuneration Committee which comprises the entire

Board excluding the Chairman who attends by invitation

and which was chaired by Mr Hardie up to August 2021

and thereafter by Mrs Mackesy.

The Company’s remuneration policy is to set

remuneration at a level to attract individuals of a calibre

appropriate to the Company’s future development.

Further information on remuneration is disclosed in the

Directors’ Remuneration Report on pages 61 to 63.

Going Concern

The Directors have undertaken a robust review of the

Company’s viability (refer to statement on page 39) and

ability to continue as a going concern. The Company’s

assets consist of a diverse portfolio of listed equity shares

and bonds. The equities and a majority of the bond

portfolio are, in most circumstances, realisable within a

very short timescale.

The Company has a £60 million loan facility which is due to

mature in May 2022. The Directors are currently reviewing

options to replace the facility including the use of the Loan

Note Shelf Facility. If acceptable terms are available, the

Company expects to continue to access a similarly sized

58 Murray International Trust PLC

level of gearing. However, should the Board decide not to

replace the facility any maturing debt would be repaid

through the proceeds of equity and/or bond sales.

The Directors are mindful of the principal risks and

uncertainties disclosed on pages 37 and 38 including the

continuing global economic disruption caused by the

Covid-19 pandemic and have reviewed forecasts

detailing revenue and liabilities. Notwithstanding the

continuing uncertain economic environment, the Directors

believe that the Company has adequate financial

resources to continue its operational existence for the

foreseeable future and at least 12 months from the date

of this Annual Report. Accordingly, the Directors continue

to adopt the going concern basis in preparing these

financial statements.

Accountability and Audit

Each Director confirms that, so far as he or she is aware,

there is no relevant audit information of which the

Company’s auditor is unaware, and he or she has taken all

the steps that they ought 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.

Independent Auditor

BDO LLP was appointed independent auditor to the

Company with effect from the AGM on 27 April 2020. BDO

LLP has expressed its willingness to continue to be the

Company’s independent auditor and a Resolution to re-

appoint BDO LLP as the Company’s auditor will be put to

the forthcoming AGM, along with a separate Resolution to

authorise the Directors to fix the auditor’s remuneration.

Internal Controls and Risk Management

Details of the financial risk management policies and

objectives relative to the use of financial instruments by

the Company are set out in note 18 to the financial

statements. The Board of Directors is ultimately

responsible for the Company’s system of internal control

and for reviewing its effectiveness. Following the Financial

Reporting Council’s publication of “Guidance on Risk

Management, Internal Controls and Related Financial and

Business Reporting” (the “FRC Guidance”), the Directors

confirm that there is an ongoing process for identifying,

evaluating and managing the significant risks faced by the

Company. This process has been in place for the full year

under review and up to the date of approval of the

financial statements, and this process is regularly

reviewed by the Board and accords with the relevant

sections of the FRC Guidance.

The Board has reviewed the effectiveness of the system of

internal control and, in particular, it has reviewed the

process for identifying and evaluating the significant risks

faced by the Company and the policies and procedures

by which these risks are managed.

The Directors have delegated the investment

management of the Company’s assets to ASFML 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 ASFML’s internal audit function which

undertakes periodic examination of business processes,

including compliance with the terms of the management

agreement, and ensures that recommendations to

improve controls are implemented.

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 Guidance and includes financial, regulatory, market,

operational and reputational risk. This helps the Manager’s

internal audit risk assessment model to identify those

functions for review. Any relevant weaknesses identified

through internal audit’s review are reported to the Board

and timetables are agreed for implementing

improvements to systems, processes and controls. The

implementation of any remedial action required is

monitored and feedback provided to the Board.

The key components designed to provide effective

internal control for the year under review and up to the

date of this Report are outlined below:

· the Manager prepares forecasts and management

accounts which allow the Board to assess the

Company’s activities and review its investment

performance;

· the Board and Manager have agreed clearly defined

investment criteria;

· there are specified levels of authority and exposure

limits. Reports on these issues, including performance

statistics and investment valuations, are regularly

submitted to the Board. The Manager’s investment

process and financial analysis of the companies

concerned include detailed appraisal and due diligence;

· as a matter of course the internal audit and compliance

departments of ASFML continually review 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 monitoring

reports are received from these providers when

required;

· the Board has considered the need for an internal audit

function but, because of the compliance and internal

Directors’ Report

Continued

Murray International Trust PLC 59

control systems in place at the Manager, has decided to

place reliance on the Manager’s systems and internal

audit procedures; and

· twice a year, at its board meetings, the Board carries out

an assessment of internal controls by considering

documentation from the Manager, including its internal

audit and compliance functions and taking account of

events since the relevant period end.

In addition, the Manager ensures that clearly documented

contractual arrangements exist in respect of any activities

that have been delegated to external professional

organisations. The Board meets annually with

representatives from BNY Mellon and reviews a control

report covering the activities of the depositary and

custodian.

Representatives from the Internal Audit Department of the

Manager report six monthly to the Audit and Risk

Committee of the Company and have direct access to

the Directors at any time.

The Board has reviewed the effectiveness of the

Manager’s system of internal control including its annual

internal controls report prepared in accordance with the

International Auditing and Assurance Standards Board’s

International Standard on Assurances Engagements

(“ISAE”) 3402, “Assurance Reports on Controls at a Service

Organisation”. The Board has also reviewed the Manager’s

process for identifying and evaluating the significant risks

faced by the Company and the policies and procedures

by which these risks are managed. The 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 provide reasonable

but not absolute assurance against material

misstatement or loss.

Discount Management Policy and Special

Business at Annual General Meeting

Issue of Shares

In terms of the Companies Act 2006 (the “Act”), the

Directors may not allot shares unless so authorised by the

shareholders. Resolution 10 in the Notice of Annual

General Meeting which will be proposed as an Ordinary

Resolution will, if passed, give the Directors the necessary

authority to allot shares up to an aggregate nominal

amount of £3,135,875 (equivalent to 12,543,501 Ordinary

shares or 10% of the Company’s existing issued share

capital at 3 March 2022, the latest practicable date prior

to the publication of this Annual Report). Such authority will

expire on the date of the 2023 Annual General Meeting or

on 30 June 2023, whichever is earlier. This means that the

authority will have to be renewed at the next Annual

General Meeting.

When shares are to be allotted for cash, Section 561 of the

Act provides that existing shareholders have pre-emption

rights and that the new shares 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 otherwise than by a

pro rata issue to existing shareholders. Special Resolution

11 will, if passed, also give the Directors power to allot for

cash equity securities up to an aggregate nominal amount

of £3,135,875 (equivalent to 12,543,501 Ordinary shares or

10% of the Company’s existing issued share capital at 3

March 2022, the latest practicable date prior to the

publication of this Annual Report), as if Section 561 of the

Act does not apply. This is the same nominal amount of

share capital which the Directors are seeking the authority

to allot pursuant to Resolution 10. This authority will also

expire on the date of the 2023 Annual General Meeting or

on 30 June 2023, whichever is earlier. This authority will not

be used in connection with a rights issue by the Company.

The Directors intend to use the authority given by

Resolutions 10 and 11 to allot shares and disapply pre-

emption rights only in circumstances where this will be

clearly beneficial to shareholders as a whole. Accordingly,

issues will only be made where shares can be issued at a

premium of 0.5% or more to NAV and there will never be

any dilution for existing shareholders. The issue proceeds

will 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.

Resolution 11 will also disapply pre-emption rights on the

sale of Treasury shares as envisaged above. Once again,

the pre-emption rights would only be disapplied where the

Treasury shares are sold at a premium to NAV of not less

than 0.5%.

Share Buybacks

At the Annual General Meeting held on 23 April 2021,

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 last Annual General Meeting. The

principal aim of a share buyback facility is to enhance

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

60 Murray International Trust PLC

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 Annual General Meeting.

Under the Listing Rules, the maximum price that may be

paid on the exercise of this authority must not be more

than the higher of (i) an amount equal to 105% of the

average of the middle market quotations for a share

taken from 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

last independent trade and the current highest

independent bid on the trading venue where the purchase

is carried out. The minimum price which may be paid is

25p per share. It is currently proposed that any purchase

of shares by the Company will be made from the capital

reserve of the Company. The purchase price will normally

be paid out of the cash balances held by the Company

from time to time.

Special Resolution 12 will permit the Company to buy back

shares and any shares bought back by the Company may

be cancelled or held as Treasury shares. The benefit of the

ability to hold Treasury shares is that such shares may be

resold. This should give the Company greater flexibility in

managing its share capital and improve liquidity in its

shares. The Company would only sell on Treasury shares

at a premium to NAV. When shares are held in Treasury,

all voting rights are suspended and no distribution (either

by way of dividend or by way of a winding up) is permitted

in respect of Treasury shares. If the Directors believe that

there is no likelihood of re-selling shares bought back, such

shares would be cancelled. During the year to 31

December 2021 the Directors have successfully used the

share buyback authority to acquire 2,576,073 shares for

Treasury.

Special Resolution 12 in the Notice of Annual General

Meeting will renew the authority to purchase in the market

a maximum of 14.99% of shares in issue at the date of the

Annual General Meeting (amounting to 18,802,709

Ordinary shares as at 3 March 2022). Such authority will

expire on the date of the 2023 Annual General Meeting or

on 30 June 2023, whichever is earlier. This means in effect

that the authority will have to be renewed at the next

Annual General Meeting or earlier if the authority has

been exhausted.

Recommendation

The Directors consider that the authorities requested

above are in the best interests of the shareholders taken

as a whole and recommend that all shareholders vote in

favour of the resolutions, as the Directors intend to in

respect of their own beneficial holdings of Ordinary shares

amounting in aggregate to 20,394 shares, representing

approximately 0.02% of the Company’s issued share

capital as at 3 March 2022.

Substantial Interests

The Board has been advised that the following

shareholders owned 3% or more of the issued Ordinary

share capital of the Company at 31 December 2021:

Shareholder

No. of Ordinary

shares held % held

Rathbones 12,900,074 10.3

Hargreaves Lansdown

12,195,320 9.7

Interactive Investor

11,694,583 9.3

abrdn Standard Retail Plans

10,327,730 8.2

Charles Stanley 6,793,467 5.4

Smith & Williamson Wealth

Management

5,807,270 4.6

Investec Wealth & Management 5,114,724 4.1

AJ Bell 4,046,679 3.2

Non-beneficial interests

There have been no significant changes notified in respect

of the above holdings between 31 December 2021 and 3

March 2022.

The UK Stewardship Code and Proxy Voting

Responsibility for actively monitoring the activities of

portfolio companies has been delegated by the Board to

the AIFM which has sub-delegated that authority to the

Manager.

The Manager is a tier 1 signatory of the UK Stewardship

Code 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.

By order of the Board of Murray International Trust PLC

Aberdeen Asset Management PLC

Secretary

1 George Street, Edinburgh EH2 2LL

3 March 2022

Directors’ Report

Continued

Murray International Trust PLC 61

The Board has prepared this report in accordance with

the regulations governing the disclosure and approval of

Directors’ remuneration.

Remuneration Committee

As recommended by the AIC Code, a Remuneration

Committee has been established with written terms of

reference, copies of which are available upon request

from the Company Secretary and on the Company’s

website. The Remuneration Committee comprises the

whole Board, excluding Dr Carter, and I, Alexandra

Mackesy, am the Chairman.

This Remuneration Report comprises three parts:

· Remuneration Policy, which is subject to a binding

shareholder vote every three years (or sooner if varied

during this interval) – most recently approved at the 27

April 2020 AGM;

· Implementation Report, which provides information on

how the Remuneration Policy has been applied during

the year and which is subject to an advisory vote on the

level of remuneration paid during the year; and,

· Annual Statement of compliance with regulations.

The law requires the Company’s auditor to audit certain of

the disclosures provided. Where disclosures have been

audited, they are indicated as such. The auditor’s opinion is

included in the report on page 72.

Remuneration Policy

This part of the Remuneration Report provides details of

the Company’s Remuneration Policy for Directors of the

Company. This policy takes into consideration the

principles of UK Corporate Governance and the AIC’s

recommendations regarding the application of those

principles to investment companies. The Company

currently has four independent non-executive Directors.

There have been no changes to the policy during the

period of this Report nor are there any proposals for

change in the foreseeable future. No shareholder views

were sought in setting the remuneration policy although

any comments received from shareholders are

considered.

The Directors are non-executive and their fees are set

within the limits of the Company’s Articles of Association.

The Board’s policy on Directors’ fees is that the

remuneration of non-executive Directors should reflect

the nature of their duties, responsibilities and the value of

their time spent and be fair and comparable to that of

other investment trusts that are similar in size, have a

similar capital structure and have a similar investment

objective. Fees are reviewed annually and, if considered

appropriate, increased accordingly.

Shareholder

December

2021

December

2020

Chairman 48,000 48,000

Chairman of Audit and Risk

Committee 34,000 34,000

Senior Independent Director 32,000 32,000

Director 28,000 28,000

Articles Limit on Directors’ Fees

The Company’s Articles of Association limit the aggregate

fees payable to the Board of Directors per annum to

£300,000. The level of cap may be increased by

shareholder resolution from time to time and was last

increased in 2021.

Terms of Appointment

· The Company intends only to appoint non-executive

Directors;

· All the Directors are non-executive appointed under the

terms of Letters of Appointment;

· Directors must retire and be subject to re-election at the

first AGM after their appointment and at least every

three years thereafter. Currently the whole Board

submits for annual re-election in line with best practice

and the New Articles submitted for approval at the

forthcoming AGM will embed annual re-election;

· It is the policy of the Board that the Chairman of the

Company will normally retire once he or she has served

as a Director for nine years (further details on page 57);

· New appointments to the Board will be placed on the

fee applicable to all Directors at the time of appointment

(£28,000 for the year to 31 December 2021);

· No incentive or introductory fees will be paid to

encourage a Directorship;

· The Directors are not eligible for bonuses, pension

benefits, share options, long-term incentive schemes or

other benefits; and

· Directors are entitled to re-imbursement of out-of-

pocket expenses incurred in connection with the

performance of their duties, including travel expenses.

Directors’ Remuneration Report

62 Murray International Trust PLC

Performance, Service Contracts,

Compensation and Loss of Office

· The Directors’ remuneration is not subject to any

performance related fee;

· No Director has a service contract;

· No Director was interested in contracts with the

Company during the period or subsequently;

· The terms of appointment provide that a Director may

be removed without notice;

· Compensation will not be due upon leaving office; and

· No Director is entitled to any other monetary payment

or any assets of the Company.

Directors’ & Officers’ liability insurance cover is maintained

by the Company on behalf of the Directors. The

Company’s Articles of Association provide an indemnity to

the Directors out of the assets of the Company against

any liability incurred in defending proceedings or in

connection with any application to the Court in which

relief is granted.

The Remuneration Policy was last approved by

shareholders at the AGM on 27 April 2020. The

Remuneration Policy is reviewed by the Remuneration

Committee on an annual basis and the Remuneration

Policy applies for the three year period ending 31

December 2022.

Implementation Report

Directors’ Fees

The Remuneration Committee carried out a review of the

level of Directors’ fees during the year encompassing a

review of fees payable to directors of peer group

companies as well as the wider sector. The Committee

concluded that the annual fees payable to Directors

should remain unchanged. There are no further fees to

disclose as the Company has no employees, Chief

Executive or Executive Directors and, other than for the

Audit and Risk Committee, no extra fees are payable to

Committee Chairmen.

Company Performance

During the year, the Board also carried out a review of

investment performance. The following graph compares

the share price total return (assuming all dividends are

reinvested) to Ordinary shareholders, assuming a notional

investment of £100 into the Company on 31 December

2011, compared with the total shareholder total return on

the Company’s Reference Index.

Please note that past performance is not a guide to future

performance.

Statement of Voting at General Meeting

At the Company’s last AGM held on 23 April 2021,

shareholders approved the Directors’ Remuneration

Report (other than the Directors’ Remuneration Policy) in

respect of the year ended 31 December 2020 and the

following proxy votes were received on the resolutions:

Resolution For*

Against

Withheld

(2) Receive and Adopt

Directors’ Remuneration

Report

53.8m

(99.3%)

332,343

(0.6%)

164,086

(3) Approve Directors’

Remuneration Policy**

38.6m

(99.3%)

230,057

(0.6%)

86,458

* Including discretionary votes

** Last voted upon on 27 April 2020

Spend on Pay

As the Company has no employees, the Directors do not

consider that it is relevant to present a table comparing

remuneration paid to employees with distributions to

shareholders. The total fees paid to Directors are shown

overleaf.

Fees Payable (Audited)

The Directors who served in the year received the

following fees which exclude employers’ National

Insurance:

£100

£150

£200

£250

£300

£350

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Share Price Reference Index

Directors’ Remuneration Report

Continued

Murray International Trust PLC 63

Director 2021

2020

D Hardie

38,280 30,733

C Binyon

32,117 28,000

A Mackesy

29,570 28,000

N Melhuish

18,667 n/a

K J Carter

15,067 48,000

M Campbell

10,672 34,000

S Fraser

22,883 18,667

Total 167,256 187,400

Mr Hardie became interim Chairman in August 2021 and Chairman in October 2021

Ms Binyon was appointed Audit and Risk Committee Chairman in April 2021

Mrs Mackesy was appointed Senior Independent Director in August 2021

Mr Melhuish was appointed to the Board on 1 May 2021

Dr Carter and Ms Campbell retired from the Board on 23 April 2021

Mr Fraser died on 9 August 2021

The Directors’ fees were last increased in December 2019,

with effect from 1 January 2020 and this increase broadly

reflected the impact of RPI over the three year period

since the last increase.

Annual Percentage Change in Directors’

Remuneration

The table below sets out the annual percentage change in

Directors’ fees over the last two years.

Director Year ended

31 December

2021 %

Year ended

31 December

2020 %

D Hardie

24.6 18.2

C Binyon

14.7 7.7

A Mackesy

5.6 7.7

N. Melhuish

n/a n/a

Mr Hardie became interim Chairman in August 2021and Chairman in October 2021

Ms Binyon was appointed Audit and Risk Committee Chairman in April 2021

Mrs Mackesy was appointed Senior Independent Director in August 2021

Mr Melhuish was appointed to the Board on 1 May 2021

Fees are pro-rated where a change takes place during a

financial year. There were no payments to third parties

from the fees referred to in the table above.

Directors’ Interests in the Company

(Audited)

The Directors are not required to have a shareholding in

the Company. The Directors (including connected

persons) at 31 December 2021 and 31 December 2020

had no interest in the share capital of the Company other

than those interests, all of which are beneficial interests,

shown in the following table.

31 December

2021

Ordinary 25p

31 December

2020

Ordinary 25p

D Hardie 15,489 14,777

C Binyon 1,213 1,161

A Mackesy 975 -

N. Melhuish

2,563 n/a

K J Carter

65,000 65,000

M Campbell

17,174 17,174

S Fraser

7,500 -

Mr Melhuish was appointed to the Board on 1 May 2021

Shareholding at date of retirement on 23 April 2021

Shareholding at date of death on 9 August 2021

Subsequent to the period end Mr Hardie’s beneficial

holding has increased to 15,643 Ordinary shares following

reinvestment of the third interim dividend paid on 18

February 2022. With the exception of this further

disclosure, the Directors’ holdings were unchanged at 3

March 2022, being the nearest practicable date prior to

the signing of this Annual 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, Alexandra Mackesy, Chairman of the

Remuneration Committee, confirm that the Report on

Remuneration Policy and the Remuneration

Implementation Report summarises, as applicable, for the

year to 31 December 2021:

· 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

decisions have been taken.

The Directors’ Remuneration Report was approved by the

Board of Directors on 3 March 2022 and signed on its

behalf by:

Alexandra Mackesy

Remuneration Committee Chairman

3 March 2022

64 Murray International Trust PLC

The Audit and Risk Committee has prepared this report in

compliance with the September 2014 Competition and

Markets Authority Order.

Audit and Risk Committee

As recommended by the AIC Code, an Audit and Risk

Committee has been established with written terms of

reference, copies of which are available upon request

from the Company Secretary and on the Company’s

website. The Audit and Risk Committee comprises the

whole Board (excluding Mr Hardie) and following the

retirement of Ms Campbell at the AGM in 2021, I, Claire

Binyon, am the Chairman. Mr Hardie is not a member of

the Committee, but, as Chairman of the Company, he has

a standing invitation to attend meetings and typically

attends each Audit and Risk Committee as an observer.

The members of the Audit and Risk Committee are each

independent and free from any relationship that would

interfere with our impartial judgement in carrying out our

responsibilities. We have satisfied ourselves that at least

one of the Committee’s members has recent and relevant

financial experience. We met three times during the year.

The terms of reference of the Audit and Risk Committee

are reviewed and re-assessed for their adequacy on an

annual basis. In accordance with those terms of

reference:

· we review and monitor the internal control systems and

risk management systems including review of non

financial risks and the Manager’s policy on information

security (cyber risk) on which the Company is reliant.

The Directors’ statement on the Company’s internal

controls and risk management is set out in the Directors’

Report;

· we consider whether there is a need for the Company

to have its own internal audit function (refer to Directors’

Report);

· we 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;

· we 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, interim reports, announcements

and related formal statements;

· we review the content of the Annual Report and

financial statements and make recommendations to

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;

· we meet with the auditor to review the proposed audit

programme of work and the findings of the auditor. The

Directors also use this as an opportunity to assess the

effectiveness of the audit process;

· we also meet in private with the auditor, without any

representatives of the Manager being present, and we

meet in private with a representative from the

Manager’s internal audit department;

· we develop and implement the policy on the

engagement of the auditor to supply non-audit services.

There were non-audit fees of £3,500 (2020: £3,500) paid

to the auditor during the year under review in

connection with assurance work conducted on the Half

Yearly Report;

· we review a statement from the Manager detailing the

arrangements in place within the abrdn Group whereby

staff may, in confidence, escalate concerns about

possible improprieties in matters of financial reporting or

other matters;

· we make recommendations in relation to the

appointment of the auditor and to approve the

remuneration and terms of engagement of the auditor;

and

· we monitor and review the auditor’s independence,

objectivity, effectiveness, resources and qualification.

Details of attendance at the Audit and Risk Committee

meetings are shown in the Directors’ Report.

The Board has received a report from BDO, its auditor,

which notes that BDO has policies and procedures in

place that instil professional values as part of its firm’s

culture and ensure that the highest standards of

objectivity and independence and integrity are

maintained.

The Company’s policy on non-audit services is to ensure

that best value for the Company is achieved whilst

ensuring compliance with regulations that are in place to

maintain the independence of the auditor. The extent of

non-audit services that can be provided by BDO is very

limited. The Audit and Risk Committee has reviewed and

approved the level of non-audit services provided by the

independent auditor during the year, together with the

independent auditor’s procedures in connection with the

provision of such services, and remains satisfied that the

auditor’s objectivity and independence is being

safeguarded. The level of non-audit fees payable by the

Company is not material in any way for BDO and the Audit

and Risk Committee confirms its belief that BDO is

independent in accordance with applicable ethical

standards. Since its appointment, BDO has not provided

any significant non-audit services to the Company.

Report of Audit and Risk Committee

Murray International Trust PLC 65

Deloitte and PwC provide ongoing local tax compliance

services to the Company.

Significant Matters

During our review of the Company’s financial statements

for the year ended 31 December 2021, we considered the

following significant matters:

Valuation and Ownership of Investments

Mitigation – The Board reviews monthly management

accounts that include a full breakdown of the portfolio

valuation. The valuation of investments is undertaken in

accordance with the accounting policies, disclosed in

notes 2(e) and 10 to the financial statements on pages 81

and 87. All investments are quoted and can be verified

against daily market prices. 91.5% (2020: 88.4%) of

investments are considered to be liquid and are therefore

categorised as Level 1 in accordance with the FRS 102 fair

value hierarchy. 8.5% (2020: 11.6%) of investments are

considered to be subject to some risk of illiquidity and are

therefore categorised as Level 2 within the FRS 102 fair

value hierarchy. 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. BNY Mellon has

been appointed as custodian and depositary to safeguard

the assets of the Company. The depositary checks the

consistency and accuracy of its records on a monthly

basis and reports its findings to ASFML. Separately, the

investment portfolio is reconciled regularly by the

Manager.

Correct Calculation of Management Fees

Mitigation - The management fees are calculated by the

Manager and reviewed annually by the Audit and Risk

Committee and auditor.

Revenue Recognition

Mitigation - The recognition of investment income is

undertaken in accordance with accounting policy 2(b)

and note 3 to the financial statements on pages 80 and 83.

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 Manager

provides

monthly internal control reports to the Board which are

reviewed together with monthly revenue forecasts and

dividend schedules.

Review of Auditor

We have reviewed the work undertaken by BDO, which is

in its second year following original appointment at the

AGM on 27 April 2020, and are satisfied with the

effectiveness of the auditor. The areas of focus included:

· independence - the auditor discusses with the Audit and

Risk Committee, at least annually, the steps it takes to

ensure its independence and objectivity 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 and

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 Board, the

Committee and 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 company sector

and retention or rotation of the partner.

BDO is in its second year as auditor to the Company and in

accordance with present professional guidelines the

Senior Statutory Auditor will be rotated after no more than

five years and the year ended 31 December 2021 will be

the second year for which the present Senior Statutory

Auditor will serve. The Committee considers BDO, the

Company’s auditor, to be independent of the Company.

For and on behalf of the Audit and Risk Committee

Claire Binyon,

Audit and Risk Committee Chairman

3 March 2022

66 Murray International Trust PLC

Directors’ Responsibilities

The Directors are responsible for preparing the Annual

Report and the financial statements in accordance with

United Kingdom Generally Accepted Accounting Practice,

the requirements of the Companies Act 2006 and

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 for 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 judgements 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;

· prepare the financial statements on the going concern

basis unless it is inappropriate to presume that the

company will continue in business; and

· prepare a director’s report, a strategic report and

director’s remuneration report which comply with the

requirements of the Companies Act 2006.

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. In accordance with their responsibilities, the

Directors confirm that, to the best of their knowledge, 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

position, performance, business model and strategy.

Website Publication

The Directors are responsible for ensuring the Annual

Report and the financial statements are made available

on a website. Financial statements are published on

murray-intl.co.uk, the Company’s website, in accordance

with legislation in the United Kingdom governing the

preparation and dissemination of financial statements,

which may vary from legislation in other jurisdictions. The

maintenance and integrity of the Company's website is

the responsibility of the Directors. The Directors'

responsibility also extends to the ongoing integrity of the

financial statements contained therein.

Directors’ Responsibilities Pursuant to DTR4

The Directors confirm to the best of their knowledge:

· The financial statements have been prepared in

accordance with the applicable accounting standards

and give a true and fair view of the assets, liabilities,

financial position and profit of the Company; and

· The Annual Report includes a fair review of the

development and performance of the business and the

financial position of the company, together with a

description of the principal risks and uncertainties that

they face.

For Murray International Trust PLC

David Hardie

Chairman

3 March 2022

Statement of Directors’ Responsibilities

Murray International Trust PLC 67

Opinion on the financial statements

In our opinion the financial statements:

• give a true and fair view of the state of the Company’s affairs as at 31 December 2021 and of its profit for the

year then ended;

• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice;

and

• have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements of Murray International Trust PLC (the ‘Company’) for the year ended 31

December 2021 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the

Statement of Changes in Equity, the Statement of Cash flows and notes to the financial statements, including a summary

of significant accounting policies. The financial reporting framework that has been applied in their preparation is

applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial

Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting

Practice).

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law.

Our responsibilities under those standards are further described in the Auditor’s 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. Our audit opinion is consistent with the additional report to the Audit and

Risk Committee.

Independence

Following the recommendation of the Audit and Risk Committee, we were appointed by the Board of Directors on 27

April 2020 to audit the financial statements for the year ending 31 December 2020 and subsequent financial periods. The

period of total uninterrupted engagement including retenders and reappointments is 2 years, covering the years ending

31 December 2020 to 31 December 2021. We remain independent of the Company in accordance with the ethical

requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as

applied to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these

requirements. The non-audit services prohibited by that standard were not provided to the Company.

Conclusions relating to going concern

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. Our evaluation of the Directors’ assessment of the

Company’s ability to continue to adopt the going concern basis of accounting included:

• Assessing the appropriateness of the Directors’ assumptions and judgements made by comparing the prior

year forecasted costs to the actual costs incurred to check that the projected costs are reasonable.

• Assessing the projected management fees for the going concern review period to check that it was in line with

the current assets under management levels and the projected market growth forecasts.

• Sensitising the forecasts based on an economic downturn and calculating financial ratios to ascertain the

financial health of the Company, including performing calculations assessing the net asset position of the

Company to understand the reliance on loans.

• Checking the availability of cash to meet forecast expenditure in both the base case and sensitised scenarios.

• Reviewing the loan agreements to identify the covenants and assessing the likelihood of them being breached

based on the Directors’ forecasts and our sensitivity analysis.

Independent Auditor’s Report to the Members of

Murray International Trust PLC

68 Murray International Trust PLC

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 relation to the Company’s reporting on how it has 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.

Overview

Key audit matters

2021 2020

Revenue recognition D D

Valuation and ownership of investments D D

Materiality Company financial statements as a whole:

£15.6m (2020: £14.6m) based on 1% (2020: 1%) of Net Assets

An overview of the scope of our audit

Our audit was scoped by obtaining an understanding of the Company and its environment, including the Company’s

system of internal control, and assessing the risks of material misstatement in the financial statements. We also

addressed the risk of management override of internal controls, including assessing whether there was evidence of bias

by the Directors that may have represented a risk of material misstatement.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our 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) that we identified, 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 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.

Independent Auditor’s Report to the Members of

Murray International Trust PLC

Continued

Murray International Trust PLC 69

Key audit matter

How the scope of our audit addressed the key audit

matter

Revenue recognition

(Note 2(b) and 3 to the

financial statements)

Income arises from dividends and

interest and can be volatile but is

often a key factor in demonstrating

the performance of the portfolio.

Additionally, judgement is required

by management in determining

the allocation of dividend income

to revenue or capital.

We responded to this matter by utilising data analytics

to test 100% of the portfolio.

We derived an independent expectation of income

based on the investment holding and distributions per

independent sources and compared to that

recognised.

We also cross checked the portfolio against corporate

actions and special dividends and challenged if these

had been appropriately accounted for as income or

capital by reviewing the underlying reason for issue of

the dividend and whether it could be driven by a

capital event.

We analysed the whole population of dividend

receipts to identify items for further discussion that

could indicate a capital distribution, for example

where a dividend represents a particularly high yield.

Key observations:

Based on our procedures performed we found the

revenue recognition to be appropriate.

Valuation and

ownership of

investments

(Note 2(e) and 10 to

the financial

statements)

The investment portfolio at the

year-end comprised of listed

equity and fixed income

investments held at fair value

through profit or loss.

We consider the valuation and

ownership of investments to be the

most significant audit areas as

investments represent the most

significant balance in the Financial

Statements and underpin the

principal activity of the entity.

Furthermore, we consider the

valuation disclosures to be a

significant area as they are

expected to be a key area of

interest for the users of the

financial statements.

We have responded to this matter by testing the

valuation and ownership of 100% of the portfolio of

investments. We performed the following procedures:

- Obtained direct confirmation from the

custodian regarding the existence and

ownership of all investments held at the

balance sheet date.

- Recalculating the valuation by multiplying the

number of shares held per the statement

obtained from the custodian by the valuation

per share.

- Confirmed the year end bid price used by

agreeing to externally quoted prices and

assessed if there were contra indicators, such

as liquidity considerations, that would suggest

bid price is not the most appropriate

indication of fair value. Contra indicators

examples include considering the realisation

period for individual holdings.

We also considered the completeness, accuracy and

clarity of investment-related disclosures against the

requirements of the relevant accounting standard.

70 Murray International Trust PLC

Key observations:

Based on our procedures performed we did not

identify any matters to suggest the valuation or

ownership of listed equity and fixed income

investments or the related disclosures was not

appropriate.

Our application of materiality

We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of

misstatements. We consider materiality to be the magnitude by which misstatements, including omissions, could

influence the economic decisions of reasonable users that are taken on the basis of the financial statements.

In order to reduce to an appropriately low level the probability that any misstatements exceed materiality, we use a

lower materiality level, performance materiality, to determine the extent of testing needed. Importantly, misstatements

below these levels will not necessarily be evaluated as immaterial as we also take account of the nature of identified

misstatements, and the particular circumstances of their occurrence, when evaluating their effect on the financial

statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole and

performance materiality as follows:

Company financial statements

2021

£m

2020

£m

Materiality 15.6 14.6

Basis for determining

materiality

1% of Net Assets 1% of Net Assets

Rationale for the benchmark

applied

As an investment trust, the net asset value is the key measure of performance for users

of the financial statements.

Performance materiality 11.7 9.5

Basis for determining

performance materiality

75% of materiality based on our risk

assessment and consideration of the

control environment.

We also considered the history of

misstatements based on our knowledge

obtained in the previous year,

aggregation effect of planned nature of

testing and the overall size complexity of

the entity.

65% of materiality based on our risk

assessment and consideration of the

control environment. We also considered

the aggregation effect of planned nature

of testing, the overall size complexity of

the Company and the fact that it was our

first year as auditors.

Independent Auditor’s Report to the Members of

Murray International Trust PLC

Continued

Murray International Trust PLC 71

Specific materiality

We determined that for items impacting revenue return, a misstatement of less than materiality for the financial

statements as a whole, specific materiality, could influence the economic decisions of users. As a result, we determined

materiality for these items based on revenue return before tax to be £3,680,000 (2020: £3,200,000). Specific materiality

was determined using 5% (2020: 5%) of revenue return before tax. We further applied a performance materiality level

of 75% (2020: 65%) of revenue return before tax to ensure that the risk of errors exceeding specific materiality was

appropriately mitigated.

Reporting threshold

We agreed with the Audit and Risk Committee that we would report to them all individual audit differences in excess of

£184,000 (2020: £160,000). We also agreed to report differences below this threshold that, in our view, warranted

reporting on qualitative grounds.

Other information

The directors are responsible for the other information. The other information comprises the information included in the

Annual Report other than the financial statements and our auditor’s report thereon. Our opinion on the financial

statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we

do not express any form of assurance conclusion thereon. 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 course of the audit, or otherwise appears to be materially misstated. If we identify such material

inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material

misstatement in the financial statements themselves. 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 in this regard.

Corporate governance statement

The Listing Rules require us to review the Directors’ statement 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.

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 or our knowledge obtained

during the audit.

Going concern and

longer-term viability

· The Directors' statement with regards to the appropriateness of adopting the going

concern basis of accounting and any material uncertainties identified set out on pages

57 and 58; and

· The Directors’ explanation as to their assessment of the Company’s prospects, the

period this assessment covers and why the period is appropriate set out on page 39.

Other Code provisions · Directors' statement on fair, balanced and understandable set out on page 66;

· Board’s confirmation that it has carried out a robust assessment of the emerging and

principal risks set out on page 37;

· The section of the annual report that describes the review of effectiveness of risk

management and internal control systems set out on page 37; and

· The section describing the work of the Audit and Risk Committee set out on page 64.

72 Murray International Trust PLC

Other Companies Act 2006 reporting

Based on the responsibilities described below and our work performed during the course of the audit, we are required by

the Companies Act 2006 and ISAs (UK) to report on 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 the Directors’ report for the financial

year for which the financial statements are prepared is consistent with the financial

statements; and

· the Strategic report and the Directors’ report have been prepared in accordance with

applicable legal requirements.

In the light of the knowledge and understanding of the Company and its environment

obtained in the course of the audit, we have not identified material misstatements in the

strategic report or the 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.

Matters on which we are

required to report by

exception

We have nothing to report in respect of the following matters in relation to which the

Companies Act 2006 requires us to report to you if, in our opinion:

· adequate accounting records have not been kept, or returns adequate for our audit

have not been received from branches not visited by us; 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; or

· certain disclosures of Directors’ remuneration specified by law are not made; or

· we have not received all the information and explanations we require for our audit.

Responsibilities of Directors

As explained more fully in the Statement of Directors’ Responsibilities, the Directors are responsible for the preparation of

the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the

Directors 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.

Auditor’s 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 auditor’s 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.

Extent to which the audit was capable of detecting irregularities, including

fraud

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 Auditor’s Report to the Members of

Murray International Trust PLC

Continued

Murray International Trust PLC 73

We gained an understanding of the legal and regulatory framework applicable to the Company and industry in which it

operates and considered the risk of acts by the Company which were contrary to applicable laws and regulations,

including fraud. We considered the significant laws and regulations to be the Companies Act 2006, the UK Listing Rules,

the DTR rules, the principles of the UK Corporate Governance Code, industry practice represented by the AIC SORP and

FRS102. We also considered the Company’s qualification as an Investment Trust under UK tax legislation.

We assessed the susceptibility of the financial statements to material misstatement, including fraud and considered the

fraud risk areas to be revenue recognition and management override of controls.

Our procedures included:

· agreement of the financial statement disclosures to underlying supporting documentation;

· obtaining an understanding of the control environment in monitoring compliance with laws and regulations;

· enquiries of management and those charged with governance regarding known or suspected instances of non-

compliance with laws and regulation and fraud within the Company and its operations. We corroborated our enquiries

through our review of board minutes for the year, reviewing correspondence with the relevant authorities and other

evidence gathered during the course of the audit;

· testing the appropriateness of a sample of journal entries in the general ledger by agreeing to supporting

documentation and adjustments made in the preparation of the financial statements, reviewing and assessing the

accounting estimates for possible bias and obtaining an understanding of the business rationale of significant

transactions that are outside the normal course of the business for the Company and those that appear to be unusual;

· the procedures set out in the Key Audit Matters section above.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team

members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout

the audit.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements,

recognising that 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, misrepresentations or

through collusion. There are inherent limitations in the audit procedures performed and the further removed non-

compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less

likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council’s website at:

www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the

Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those

matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted

by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as

a body, for our audit work, for this report, or for the opinions we have formed.

Peter Smith (Senior Statutory Auditor)

For and on behalf of BDO LLP, Statutory Auditor

London, UK

3 March 2022

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

74 Murray International Trust PLC

Financial

Statements

The Company invests in Taiwan Semiconductor,

a Taiwanese multinational semiconductor contract

manufacturing and design company

Murray International Trust PLC 75

For the year to 31 December 2021

the Company’s Revenue Return per

Ordinary share increased to 51.7p

(2020: 46.6p) and the Company

proposes to pay a total dividend

amounting to 55.0p (2020: 54.5p)

76 Murray International Trust PLC

Year ended 31 December 2021 Year ended 31 December 2020

Revenue Capital Total Revenue Capital Total

Notes

£’000 £’000 £’000 £’000 £’000 £’000

Gains/(losses) on investments

– 139,637 139,637 – (49,645) (49,645)

Income

78,737 – 78,737 68,918 – 68,918

Investment management fees

(2,086) (4,867) (6,953) (2,054) (4,795) (6,849)

Currency losses

– (745) (745) – (3,757) (3,757)

Administrative expenses

(1,752) – (1,752) (1,966) – (1,966)

Net return before finance costs and taxation

74,899 134,025 208,924 64,898 (58,197) 6,701

Finance costs

(1,216) (2,838) (4,054) (1,189) (2,775) (3,964)

Return before taxation

73,683 131,187 204,870 63,709 (60,972) 2,737

Taxation

(7,554) 798 (6,756) (3,513) 1,033 (2,480)

Return attributable to equity shareholders

66,129 131,985 198,114 60,196 (59,939) 257

Return per Ordinary share (pence)

9 51.7 103.1 154.8 46.6 (46.4) 0.2

The “Total” column of this statement represents the profit and loss account of the Company. There is no other

comprehensive income and therefore the return after taxation is also the total comprehensive income for the year.

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.

The accompanying notes are an integral part of these financial statements.

Statement of Comprehensive Income

Murray International Trust PLC 77

As at As at

31 December 2021 31 December 2020

Notes

£’000 £’000

Non-current assets

Investments at fair value through profit or loss

1,739,312 1,646,405

Current assets

Debtors

15,377 14,410

Cash and short-term deposits

8,705 3,208

24,082 17,618

Creditors: amounts falling due within one year

Bank loans

12,13

(59,975) (50,000)

Other creditors

(2,514) (2,391)

(62,489) (52,391)

Net current liabilities

(38,407) (34,773)

Total assets less current liabilities

1,700,905 1,611,632

Creditors: amounts falling due after more than one year

Bank loans

12,13

(89,930) (149,805)

Loan Notes

12,13

(49,909) –

Net assets

1,561,066 1,461,827

Capital and reserves

Called-up share capital

32,353 32,353

Share premium account

362,967 362,967

Capital redemption reserve

8,230 8,230

Capital reserve

1,094,549 991,513

Revenue reserve

62,967 66,764

Equity shareholders’ funds

1,561,066 1,461,827

Net asset value per Ordinary share (pence)

1,240.3 1,138.2

The financial statements were approved and authorised for issue by the Board of Directors on 3 March 2022 and were signed on its

behalf by:

David Hardie

Director

The accompanying notes are an integral part of these financial statements.

Statement of Financial Position

78 Murray International Trust PLC

For the year ended 31 December 2021

Share Capital

Share premium redemption Capital Revenue

capital account reserve reserve reserve Total

Note

£’000 £’000 £’000 £’000 £’000 £’000

Balance at 31 December 2020

32,353 362,967 8,230 991,513 66,764 1,461,827

Return after taxation

– – – 131,985 66,129 198,114

Dividends paid

– – – – (69,926) (69,926)

Buy back of shares to Treasury

– – – (28,949) – (28,949)

Balance at 31 December 2021

32,353 362,967 8,230 1,094,549 62,967 1,561,066

For the year ended 31 December 2020

Share Capital

Share premium redemption Capital Revenue

capital account reserve reserve reserve Total

£’000 £’000 £’000 £’000 £’000 £’000

Balance at 31 December 2019

32,333 361,989 8,230 1,060,756 75,747 1,539,055

Return after taxation

– – – (59,939) 60,196 257

Dividends paid

– – – – (69,179) (69,179)

Issue of new shares

20 978 – – – 998

Buy back of shares to Treasury

– – – (9,304) – (9,304)

Balance at 31 December 2020

32,353 362,967 8,230 991,513 66,764 1,461,827

The accompanying notes are an integral part of these financial statements.

Statement of Chan

es in Equity

Murray International Trust PLC 79

Year ended Year ended

31 December 2021 31 December 2020

Notes

£’000 £’000

Net return before finance costs and taxation

208,924 6,701

Decrease in accrued expenses

(8) (104)

Overseas withholding tax

(9,123) (6,857)

Decrease in accrued income

706 3,520

Interest paid

(3,818) (4,019)

(Gains)/losses on investments

(139,637) 49,645

Currency losses

745 3,757

Decrease/(increase) in other debtors

22 (53)

Corporation tax received

321 2,707

Net cash inflow from operating activities

58,132 55,297

Investing activities

Purchases of investments

(177,090) (257,535)

Sales of investments

224,171 256,648

Net cash from/(used in) investing activities

47,081 (887)

Financing activities

Equity dividends paid

(69,926) (69,179)

Ordinary shares bought back to Treasury

(28,949) (9,304)

Issue of Ordinary shares

– 998

Issue of Loan Notes

49,904 –

Loan repayment

(50,000) (50,000)

Loan drawdown

– 50,000

Net cash used in financing activities

(98,971) (77,485)

Increase/(decrease) in cash

6,242 (23,075)

Analysis of changes in cash during the year

Opening balance

3,208 30,040

Effect of exchange rate fluctuations on cash held

(745) (3,757)

Increase/(decrease) in cash as above

6,242 (23,075)

Closing balances

8,705 3,208

The accompanying notes are an integral part of these financial statements.

Statement of Cash Flows

80 Murray International Trust PLC

1. Principal activity

The Company is a closed-end investment company, registered in Scotland No SC006705, with its Ordinary shares being listed

on the London Stock Exchange.

2. Accounting policies

(a) Basis of preparation. The financial statements have been prepared in accordance with Financial Reporting Standard 102

and with the AIC’s Statement of Recommended Practice ‘Financial Statements of Investment Trust Companies and

Venture Capital Trusts’ issued in April 2021. 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 Company’s assets consist substantially of equity shares in companies listed on recognised stock exchanges and in

most circumstances are realisable within a short timescale. The Board has set limits for borrowing and regularly reviews

actual exposures, cash flow projections and compliance with banking covenants. Having taken these factors into account

as well as the impact of Covid-19 and having assessed the principal risks and other matters set out in the Viability

Statement on page 37, the Directors believe that, after making enquiries, the Company has adequate resources to

continue in operational existence for the foreseeable future and has the ability to meet its financial obligations as they fall

due for a period of at least twelve months from the date of approval of this Report. Accordingly, they continue to adopt the

going concern basis of accounting in preparing the financial statements. Further detail is included in the Directors’ Report

(unaudited) on page 57 and 58.

Significant accounting judgements, estimates and assumptions. The preparation of financial statements requires the use of

certain significant accounting judgements, estimates and assumptions which requires management to exercise its

judgement in the process of applying the accounting policies and are continually evaluated. The areas requiring most

significant judgement and assumption in the financial statements are: the determination of the fair value hierarchy

classification of quoted preference shares and bonds which have been assessed as being Level 2 as they are not

considered to trade in active markets; and also the determination of whether special dividends received are considered to

be revenue or capital in nature. The Directors do not consider there to be any significant estimates within the financial

statements.

(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 are recognised on their due date. Provision is made for any dividends not expected to

be received. Special dividends are credited to capital or revenue, according to their circumstances.

In some jurisdictions, investment income and capital gains are subject to withholding tax deducted at the source of the

income. The Company presents the withholding tax separately from the gross investment income in the Statement of

Comprehensive Income under taxation.

The fixed returns on debt securities are recognised on a time apportionment basis so as to reflect the effective yield on the

debt securities.

Interest receivable from cash and short-term deposits is accrued to the end of the year.

Notes to the Financial Statements

For the year ended 31 December 2021

Murray International Trust PLC 81

Income. Expenses are charged against revenue except as follows:

– transaction costs on the acquisition or disposal of investments are charged against capital in the Statement of

Comprehensive Income; and

– expenses are treated as a capital item in the Statement of Comprehensive Income and ultimately recognised in the

capital reserve 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 the capital

reserve to reflect the Company’s investment policy and prospective income and capital growth.

(d) Taxation. The tax expense 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 return 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.

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) Investments. The Company has chosen to apply the recognition and measurement provisions of IAS 39 Financial

Instruments: Recognition and Measurement and 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 at fair value. For listed

investments, the valuation of investments at the year end 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 treated in net profit or loss 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 includes short-term,

highly liquid investments, that are readily convertible to known amounts of cash and that are subject to an insignificant risk

of change in value.

82 Murray International Trust PLC

(g) Short-term debtors and creditors. Both short-term debtors and creditors are measured at amortised cost and not subject

to interest charges.

(h) Borrowings. Borrowings, which comprise interest bearing bank loans and unsecured 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. The finance costs of such borrowings are accounted for on an accruals basis using the effective

interest rate method and are charged 30% to revenue and 70% to capital in the Statement of Comprehensive Income to

reflect the Company’s investment policy and prospective income and capital growth.

(i) Nature and purpose of reserves

Called-up share capital. The Ordinary share capital on the Statement of Financial Position relates to the number of shares

in issue. This reserve is not distributable.

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 the proceeds of sales of shares held

in Treasury in excess of the weighted average purchase price paid by the Company to repurchase the shares. This reserve

is not distributable.

Capital redemption reserve. The capital redemption reserve arose when Ordinary shares were cancelled, at which point

an amount equal to the par value of the Ordinary share capital was transferred from the share capital account to the

capital redemption reserve. This reserve is not distributable.

Capital reserve. This reserve reflects any gains or losses on investments realised in the period along with any movement 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 (c) and (h) above. This reserve is distributable for the purpose of funding share

buybacks and paying dividends to the extent that gains are deemed realised.

When the Company purchases its Ordinary shares to be held in Treasury, the amount of the consideration paid, which

includes directly attributable costs, is recognised as a deduction from the capital reserve.

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 represents the amount of the Company’s reserves distributable by way

of dividend.

(j) Foreign currency. Assets and liabilities in foreign currencies are translated at the rates of exchange ruling on the Statement

of Financial Position date. Transactions involving foreign currencies are converted at the rate ruling on the date of the

transaction. Gains and losses on dividends receivable are recognised in the Statement of Comprehensive Income and are

reflected in the revenue reserve. Gains and losses on the realisation of foreign currencies are recognised in the Statement

of Comprehensive Income and are then transferred to the capital reserve.

(k) 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.

(l) Dividends payable. Dividends payable to equity shareholders are recognised in the financial statements when they have

been approved by shareholders and become a liability of the Company. Interim dividends are recognised in the financial

statements in the period in which they are paid.

Notes to the Financial Statements

Continued

Murray International Trust PLC 83

3. Income

2021 2020

£’000 £’000

Income from investments (all listed)

UK dividend income 8,547 5,855

Overseas dividends 58,240 47,138

Overseas interest 11,945 15,731

78,732 68,724

Other income

Deposit interest 1 2

Interest on corporation tax reclaim 4 192

Total income 78,737 68,918

4. Investment management fees

2021 2020

Revenue Capital Total Revenue Capital Total

£’000 £’000 £’000 £’000 £’000 £’000

Investment management fees 2,086 4,867 6,953 2,054 4,795 6,849

The Company has an agreement with Aberdeen Standard Fund Managers Limited (“ASFML”) for the provision of investment

management, secretarial, accounting and administration and promotional activity services.

The annual management fee is charged on net assets (i.e. excluding borrowings for investment purposes) averaged over the

six previous quarters (“Net Assets”), on a tiered basis. The annual management fee is charged at 0.5% of Net Assets up to £1,200

million and 0.425% of Net Assets above £1,200 million. A fee of 1.5% per annum is chargeable on the value of any unlisted

investments. The investment management fee is chargeable 30% against revenue and 70% against realised capital reserves.

During the year £6,953,000 (2020 – £6,849,000) of investment management fees was payable to the Manager, with a balance of

£1,797,000 (2020 – £1,680,000) being due at the year end. With effect from 1 January 2022 the annual management fee is

charged at 0.5% of Net Assets up to £500 million and 0.4% of Net Assets above £500 million. All other terms and conditions

remain unaltered.

With effect from 1 January 2021, the Company and Manager agreed to terminate the arrangement of allocating £100,000 of

the management fee to secretarial fees, which were chargeable 100% to revenue.

No fees are charged in the case of investments managed or advised by the abrdn Group. The management agreement may

be terminated by either party on the expiry of six months’ written notice. On termination the Manager is entitled to receive fees

which would otherwise have been due up to that date.

84 Murray International Trust PLC

5. Administrative expenses

2021 2020

£’000 £’000

Promotional activities

400 400

Secretarial fees

– 100

Registrars’ fees 133 151

Directors’ remuneration 167 198

Bank charges and custody fees 606 690

Depositary fees 149 136

Stock exchange fees 86 92

Printing and postage 60 88

Irrecoverable VAT 14 2

Auditor’s fees for:

– Statutory audit 32 30

– Other assurance services 3 4

Other expenses 102 75

1,752 1,966

In 2021 £400,000 (2020 – £400,000) was payable to ASFML to cover promotional activities during the year. At the year end £100,000 (2020 – £100,000) was due to

ASFML.

Details of the fee basis are contained in note 4.

6. Finance costs

2021 2020

Revenue Capital Total Revenue Capital Total

£’000 £’000 £’000 £’000 £’000 £’000

Bank loans and overdraft interest 1,002 2,339 3,341 1,189 2,775 3,964

Loan Notes 214 499 713 – – –

1,216 2,838 4,054 1,189 2,775 3,964

Notes to the Financial Statements

Continued

Murray International Trust PLC 85

7. Taxation

2021 2020

Revenue Capital Total Revenue Capital Total

£’000 £’000 £’000 £’000 £’000 £’000

(a) Total tax charge

Analysis for the year

Current UK tax 163 – 163 837 – 837

Double taxation relief (163) – (163) (837) – (837)

Corporation tax prior year adjustment – – – (3,071) – (3,071)

Tax relief to capital 920 (920) – 1,438 (1,438) –

Irrecoverable overseas tax suffered 9,081 122 9,203 6,688 405 7,093

Overseas tax reclaimable (2,447) – (2,447) (1,542) – (1,542)

Total tax charge for the year 7,554 (798) 6,756 3,513 (1,033) 2,480

(b) Factors affecting the tax charge for the year. The UK corporation tax rate is 19% (2020 – 19%). The tax assessed for the

year is lower than the corporation tax rate. The differences are explained below:

2021 2020

Revenue Capital Total Revenue Capital Total

£’000 £’000 £’000 £’000 £’000 £’000

Return before taxation 73,683 131,187 204,870 63,709 (60,972) 2,737

Return multiplied by the effective standard rate

of corporation tax of 19% (2020 – 19%)

14,000 24,925 38,925 12,105 (11,585) 520

Effects of:

Non taxable UK dividend income (1,624) – (1,624) (1,112) – (1,112)

(Gains)/losses on investments not taxable – (26,531) (26,531) – 9,433 9,433

Currency losses not taxable – 142 142 – 714 714

Non taxable overseas dividends (10,750) – (10,750) (8,718) – (8,718)

Irrecoverable overseas tax suffered 9,081 122 9,203 6,688 405 7,093

Overseas tax reclaimable (2,447) – (2,447) (1,542) – (1,542)

Double taxation relief (163) – (163) (837) – (837)

Marginal tax relief (544) 544 – – – –

Corporation tax prior year adjustment – – – (3,071) – (3,071)

Expenses not deductible for tax purposes 1 – 1 – – –

Total tax charge for the year 7,554 (798) 6,756 3,513 (1,033) 2,480

86 Murray International Trust PLC

The Company has not provided for deferred tax on chargeable gains or losses arising on the revaluation or disposal of

investments as it is exempt from corporation tax on these items because of its status as an investment trust company.

The Company has not recognised a deferred tax asset (2020 – same) arising as a result of there being no excess

management expense to be utilised in future periods.

8. Ordinary dividends on equity shares

2021 2020

£’000 £’000

Amounts recognised as distributions paid during the year:

Third interim for 2020 of 12p (2019 – 12.0p) 15,413 15,520

Final dividend for 2020 of 18.5p (2019 – fourth interim dividend of 17.5p) 23,748 22,647

First interim for 2021 of 12.0p (2020 – 12.0p) 15,404 15,529

Second interim for 2021 of 12.0p (2020 – 12.0p) 15,361 15,483

69,926 69,179

A third interim dividend was declared on 3 December 2021 with an ex date of 6 January 2022. This dividend of 12.0p was paid

on 18 February 2022 and has not been included as a liability in these financial statements. The proposed final dividend for 2021

is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial

statements.

Set out below are the total dividends paid and proposed in respect of the financial year, which is the basis on which the

requirements of Sections 1158–1159 of the Corporation Tax Act 2010 are considered. The revenue available for distribution by

way of dividend for the year is £66,129,000 (2020 – £60,196,000).

2021 2020

£’000 £’000

Three interim dividends for 2021 of 12.0p (2020 – 12.0p) 45,868 46,425

Proposed final dividend for 2021 of 19.0p (2020 – final dividend of 18.5p) 23,833 23,748

69,701 70,173

The amount reflected above for the cost of the proposed final dividend for 2021 is based on 125,435,018 Ordinary shares,

being the number of Ordinary shares in issue excluding those held in Treasury at the date of this Report.

Continued

Notes to the Financial Statements

Murray International Trust PLC 87

9. Return per Ordinary share

2021 2020

£’000 p £’000 p

Returns are based on the following figures:

Revenue return 66,129 51.7 60,196 46.6

Capital return 131,985 103.1 (59,939) (46.4)

Total return 198,114 154.8 257 0.2

Weighted average number of Ordinary shares 127,971,051 129,160,107

10. Investments at fair value through profit or loss

2021 2020

£’000 £’000

Opening book cost 1,324,155 1,276,337

Opening investment holdings gains 322,250 425,236

Opening fair value 1,646,405 1,701,573

Analysis of transactions made during the year

Purchases at cost 177,090 252,553

Sales proceeds received (224,171) (256,648)

Gains/(losses) on investments 139,637 (49,645)

Accretion/(amortisation) of fixed income book cost 351 (1,428)

Closing fair value 1,739,312 1,646,405

Closing book cost 1,330,337 1,324,155

Closing investment gains 408,975 322,250

Closing fair value 1,739,312 1,646,405

The Company received £224,171,000 (2020 – £256,648,000) from investments sold in the period. The book cost of these

investments when they were purchased was £171,259,000 (2020 – £203,307,000). 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.

88 Murray International Trust PLC

2021 2020

The portfolio valuation £’000 £’000

Listed on stock exchanges:

United Kingdom:

– equities 85,872 100,322

– preference shares 7,637 7,488

Overseas:

– equities 1,504,961 1,355,353

– fixed income 140,842 183,242

Total 1,739,312 1,646,405

Transaction costs. During the year expenses were incurred in acquiring or disposing of investments classified as fair value

through profit or loss. These have been expensed through capital and are included within gains/(losses) on investments in the

Statement of Comprehensive Income. The total costs were as follows:

2021 2020

£’000 £’000

Purchases 322 180

Sales 185 348

507 528

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. Debtors: amounts falling due within one year

2021 2020

£’000 £’000

Corporation tax refund 136 457

Overseas withholding tax 6,722 4,366

Other debtors 87 109

Accrued income 8,432 9,478

15,377 14,410

None of the above amounts is overdue or impaired.

Notes to the Financial Statements

Continued

Murray International Trust PLC 89

12. Creditors

2021 2020

£’000 £’000

Amounts falling due within one year:

Bank loans (note 13) 59,975 50,000

Accruals 2,514 2,391

62,489 52,391

2021 2020

£’000 £’000

Amounts falling due after more than one year:

Bank loans (note 13) 89,930 149,805

Loan Notes (note 13) 49,909 –

139,839 149,805

All financial liabilities are measured at amortised cost.

13. Borrowings

2021 2020

£’000 £’000

Unsecured bank loans repayable within one year:

Fixed rate term loan facilities

– £60,000,000 at 1.714% – 31 May 2022 59,975 –

Revolving credit facilities

– £50,000,000 at 0.72588% – 14 January 2021 – 50,000

Unsecured bank loans repayable in more than one year but less than five years:

Fixed rate term loan facilities

– £60,000,000 at 1.714% – 31 May 2022 – 59,915

– £60,000,000 at 2.328% – 31 May 2023 59,962 59,935

– £30,000,000 at 2.25% – 16 May 2024 29,968 29,955

Unsecured loan notes repayable in more than five years:

– £50,000,000 at 2.24% – 13 May 2031 49,909 –

199,814 199,805

90 Murray International Trust PLC

The terms of these loans and loan notes permit early repayment at the borrower’s option which may give rise to additional

amounts being either payable or repayable in respect of fluctuations in interest rates since drawdown. Since the Directors

currently have no intention of repaying the loans and loan notes early, then no such charges are included in the cash flows

used to determine their effective interest rate.

In May 2021 the Company finalised new long-term fixed rate borrowings through the issuance of a £50 million 10 year Senior

Unsecured Loan Note at an all-in-rate of 2.24%. The proceeds of the issue were used to repay the Company’s £50 million

revolving credit facility with the Royal Bank of Scotland International Limited, London Branch that matured at that time. Under

the terms of the Loan Note Agreement, up to an additional £150 million will also be available for drawdown by the Company

for a five year period and the Board’s current intention is to only use this additional amount to repay the Company’s existing

RBSI debt as it falls due over the coming years. Financial covenants contained within the loan note agreement provide, inter

alia, that borrowings shall at no time exceed 35% of net assets, that the Company must hold 40 investments or more and that

the net assets must exceed £650 million. At 31 December 2021 the Company held 72 investments, net assets were

£1,561,066,000 and borrowings were 12.8% thereof. The Company has complied with all financial covenants throughout the

year.

The Company also has three fixed rate term loan facilities with RBSI, all of which are fully drawn down and have maturity dates

of 31 May 2022, 31 May 2023 and 16 May 2024 respectively. Financial covenants contained within the relevant loan

agreements provide, inter alia, that borrowings shall at no time exceed 40% of net assets and that the net assets must exceed

£650 million. At 31 December 2021 net assets were £1,561,066,000, and borrowings were 12.8% thereof. The Company has

complied with all financial covenants throughout the year.

14. Share capital

2021 2020

Number £’000 Number £’000

Allotted, called up and fully paid Ordinary shares of 25p each:

Balance brought forward 128,438,662 32,110 129,332,003 32,333

Ordinary shares bought back to Treasury in the year (2,576,806) (644) (973,341) (243)

Ordinary shares issued in the year – – 80,000 20

Balance carried forward 125,861,856 31,466 128,438,662 32,110

Treasury shares:

Balance brought forward 973,341 243 – –

Ordinary shares bought back to Treasury in the year 2,576,806 644 973,341 243

Balance carried forward 3,550,147 887 973,341 243

At 31 December 2021, shares held in Treasury represented 2.8% (2020 – 0.8%) of the Company’s total issued share capital.

During the year 2,576,806 Ordinary shares were bought back to Treasury (2020 – 973,341) at a total cost of £28,949,000 (2020

– £9,304,000) net of expenses. Subsequent to the year end a further 426,838 Ordinary shares have been bought back to

Treasury at a total cost of £5,003,000. During 2020, 80,000 new Ordinary shares were issued at a premium to net asset value,

enhancing net assets per share for existing shareholders. The issue prices ranged from 1,239p to 1,254p raising £998,000 net of

expenses.

Continued

Notes to the Financial Statements

Murray International Trust PLC 91

On a winding up of the Company, any surplus assets available after payment of all debts and satisfaction of all liabilities of the

Company shall be applied in repaying the Ordinary shareholders the amounts paid up on such shares. Any surplus shall be

divided among the holders of Ordinary shares according to the amount paid up on such shares respectively.

Voting rights. In accordance with the Articles of Association of the Company, on a show of hands, every member (or duly

appointed proxy) present at a general meeting of the Company has one vote; and, on a poll, every member present in person

or by proxy shall have one vote for every 25p nominal amount of Ordinary shares held.

15. Capital reserve

2021 2020

£’000 £’000

At 31 December 2020 991,513 1,060,756

Movement in fair value gains/(losses) 139,637 (49,645)

Capital expenses (including taxation) (6,907) (6,537)

Buy back of shares to Treasury (28,949) (9,304)

Currency losses (745) (3,757)

At 31 December 2021 1,094,549 991,513

Included in the total above are investment holdings gains at the year end of £408,975,000 (2020 – £322,250,000).

16. Net asset value per share

The net asset value per share and the net asset value attributable to the Ordinary shares, at the year end calculated in

accordance with the Articles of Association and FRS 102 were as follows:

As at As at

31 December 2021 31 December 2020

Attributable net assets (£’000) 1,561,066 1,461,827

Number of Ordinary shares in issue (excluding Treasury) 125,861,856 128,438,662

Net asset value per share (pence) 1,240.3 1,138.2

17. Analysis of changes in net debt

At At

31 December Currency Cash Non-cash 31 December

2020 differences flows movements

2021

£’000 £’000 £’000 £’000 £’000

Cash and short-term deposits 3,208 (745) 6,242 – 8,705

Debt due within one year (50,000) – 50,000 (59,975) (59,975)

Debt due after more than one year (149,805) – (49,904) 59,870 (139,839)

(196,597) (745) 6,338 (105) (191,109)

92 Murray International Trust PLC

At At

31 December Currency Cash Non-cash 31 December

2019 differences flows movements

2020

£’000 £’000 £’000 £’000 £’000

Cash and short-term deposits 30,040 (3,757) (23,075) – 3,208

Debt due within one year (50,000) – – – (50,000)

Debt due after more than one year (149,704) – – (101) (149,805)

(169,664) (3,757) (23,075) (101) (196,597)

2021 figures reflect a movement in maturity dates and amortisation of finance costs, 2020 figures reflect amortisation of finance costs.

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 and risk management.

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 comprise listed equities and debt securities, cash balances,

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 may enter into derivative transactions for the purpose of

managing market risks arising from the Company’s activities in the form of swap contracts, forward foreign currency

contracts, futures and options.

The Board has delegated the risk management function to Aberdeen Standard Fund Managers Limited (“ASFML”) under the

terms of its management agreement with ASFML (further details of which are included in the Directors’ Report). The Board

regularly reviews and agrees policies for managing each of the key financial risks identified with the Manager. The types of risk

and the Manager’s approach to the management of each type of risk, are summarised below. Such approach has been

applied throughout the year and has not changed since the previous accounting period. The numerical disclosures exclude

short-term debtors and creditors.

Risk management framework. The directors of ASFML collectively assume responsibility for ASFML’s obligations under the

AIFMD including reviewing investment performance and monitoring the Company’s risk profile during the year.

ASFML is a fully integrated member of the abrdn Group (“the Group”), which provides a variety of services and support to

ASFML in the conduct of its business activities, including in the oversight of the risk management framework for the Company.

The AIFM has delegated the day to day administration of the investment policy to Aberdeen Asset Managers 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 AIFM has retained

responsibility for monitoring and oversight of investment performance, product risk and regulatory and operational risk for the

Company.

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 supports management in the

identification and mitigation of risks and provides independent monitoring of the business. The Division includes Compliance,

Business Risk, Market Risk, Risk Management and Legal. The team is headed up by the Group’s Head of Risk, who reports to the

Chief Executive Officer 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’s Chief Executive

Officer 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.

Notes to the Financial Statements

Continued

Murray International Trust PLC 93

The Group’s corporate governance structure is supported by several committees to assist the board of directors of abrdn plc,

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 on the committees’ terms of reference.

Risk management. The main risks the Company faces from its financial instruments are (i) market risk (comprising interest rate

risk, foreign currency risk and price risk), (ii) liquidity risk and (iii) credit risk.

(i) Market risk. The fair value and future cash flows of a financial instrument held by the Company may fluctuate because of

changes in market prices. This market risk comprises three elements – interest rate risk, foreign currency risk and price

risk.

Interest rate risk. Interest rate risk is the risk that interest rate movements will affect:

– the fair value of the investments in fixed interest rate securities; and

– the level of income receivable on cash deposits;

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.

The Board reviews the values of the fixed interest rate securities on a regular basis.

The Board imposes borrowing limits to ensure gearing levels are appropriate to market conditions and reviews these on

a regular basis. Borrowings comprise fixed rate facilities, which are used to finance opportunities at low rates. Current

bank covenant guidelines are detailed in note 13 on page 90.

Interest risk profile. The interest rate risk profile of the portfolio of financial assets and liabilities at the Statement of

Financial Position date was as follows:

Weighted

average

period for Weighted Non–

which average Fixed Floating interest

rate is fixed interest rate rate rate bearing

At 31 December 2021 Years % £’000 £’000 £’000

Assets

Sterling – – 7,637 8,143 116,658

US Dollar 22.06 5.52 38,866 267 527,077

Indian Rupee 4.18 7.71 20,399 2 17,061

Indonesian Rupiah 8.45 7.51 32,128 – 37,546

Mexican Peso 2.52 6.11 27,836 – 92,390

South African Rand 9.17 7.00 15,590 – 15,794

Turkish Lira 2.88 8.51 6,023 – –

Other – – – 293 784,307

Total assets 148,479 8,705 1,590,833

94 Murray International Trust PLC

Liabilities

Bank loans 1.22 2.07 (149,905) – –

Loan Notes 9.37 2.24 (49,909) – –

Total liabilities (199,814) – –

Weighted

average

period for Weighted Non–

which average Fixed Floating interest

rate is fixed interest rate rate rate bearing

At 31 December 2020 Years % £’000 £’000 £’000

Assets

Sterling – – 7,488 2,932 100,322

US Dollar 23.42 6.02 53,354 269 485,232

Indian Rupee 4.56 7.87 36,657 2 17,164

Indonesian Rupiah 9.50 7.53 32,708 – 35,729

Mexican Peso 3.58 6.09 30,267 – 97,057

South African Rand 10.17 7.00 17,074 – 5,995

Turkish Lira 3.88 8.50 13,182 – –

Other – – – 5 714,176

Total assets 190,730 3,208 1,455,675

Liabilities

Bank loans 1.66 1.73 (199,805) – –

Total liabilities (199,805) – –

The weighted average interest rate is based on the current yield of each asset, weighted by its market value. The

weighted average interest rate on bank loans is based on the interest rate payable, weighted by the total value of the

loans. The maturity dates of the Company’s loans are shown in note 13 to the financial statements.

The fixed rate assets represents quoted preference shares and bonds.

The floating rate assets consist of cash deposits on call earning interest at prevailing market rates.

The non-interest bearing assets represent the equity element of the portfolio.

Short-term debtors and creditors have been excluded from the above tables as they are not considered to be exposed

to interest rate risk.

Continued

Notes to the Financial Statements

Murray International Trust PLC 95

Interest rate sensitivity. The sensitivity analyses below have been determined based on the exposure to interest rates for

non-derivative instruments at the Statement of Financial Position date and the stipulated change taking place at the

beginning of the financial year and held constant throughout the reporting period in the case of instruments that have

floating rates.

If interest rates had been 25 basis points higher or lower (based on the current parameter used by the Manager’s

Investment Risk Department on risk assessment) and all other variables were held constant, the Company’s revenue

return for the year ended 31 December 2021 would increase/decrease by £22,000 (2020 – increase/decrease by

£8,000). This is mainly attributable to the Company’s exposure to interest rates on its floating rate cash balances. These

figures have been calculated based on cash positions at each year end.

The capital return would decrease/increase by £6,830,000 (2020 – increase/decrease by £8,526,000) using VaR (“Value

at Risk”) analysis based on 100 observations of weekly VaR computations of fixed interest portfolio positions at each year

end.

Foreign currency risk. A significant proportion of the Company’s investment portfolio is invested overseas 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 investment holdings 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. It is not the Company’s policy to hedge this risk on a continuing basis but the Company may,

from time to time, match specific overseas investment with foreign currency borrowings. The Manager seeks, when

deemed appropriate, to manage exposure to currency movements on borrowings by using forward foreign currency

contracts as a hedge against potential foreign currency movements. At 31 December 2021 the Company did not have

any forward foreign currency contracts (2020 – none).

The revenue account is subject to currency fluctuation arising on overseas income. The Company does not hedge this

currency risk.

96 Murray International Trust PLC

Currency risk exposure. Currency risk exposure (excluding fixed interest securities) by currency of denomination:

31 December 2021 31 December 2020

UK and UK and

overseas Net Total overseas Net Total

equity monetary currency equity monetary currency

investments assets

exposure investments assets

exposure

£’000 £’000 £’000 £’000 £’000 £’000

US Dollar 527,077 267 527,344 485,232 269 485,501

Taiwan Dollar 211,589 281 211,870 191,477 5 191,482

Euro 108,878 12 108,890 103,464 – 103,464

Canadian Dollar 105,794 – 105,794 65,727 – 65,727

Mexican Peso 92,390 – 92,390 97,057 – 97,057

Swedish Krone 86,431 – 86,431 58,688 – 58,688

Singapore Dollar 60,329 – 60,329 56,426 – 56,426

Hong Kong Dollar 59,761 – 59,761 57,642 – 57,642

Swiss Franc 56,674 – 56,674 93,181 – 93,181

Thailand Baht 41,949 – 41,949 39,075 – 39,075

Indonesian Rupiah 37,546 – 37,546 35,729 – 35,729

Danish Krone 35,496 – 35,496 – – –

Norwegian Krone 17,406 – 17,406 18,699 – 18,699

Indian Rupee 17,061 2 17,063 17,164 2 17,166

South African Rand 15,794 – 15,794 5,995 – 5,995

New Zealand Dollar – – – 15,949 – 15,949

Japanese Yen – – – 13,848 – 13,848

1,474,175 562 1,474,737 1,355,353 276 1,355,629

Sterling 116,658 (191,671) (75,013) 100,322 (196,873) (96,551)

Total 1,590,833 (191,109) 1,399,724 1,455,675 (196,597) 1,259,078

Reflects cash, short-term deposits and bank borrowings.

Notes to the Financial Statements

Continued

Murray International Trust PLC 97

The asset allocation between specific markets can vary from time to time based on the Manager’s opinion of the

attractiveness of the individual markets.

Foreign currency sensitivity. The following table details the Company’s sensitivity to a 10% decrease (in the context of a

10% increase the figures below should all be read as negative) in sterling against the major foreign currencies in which

the Company has exposure (based on exposure >5% of total exposure). The sensitivity analysis includes foreign currency

denominated monetary items and adjusts their translation at the year end for a 10% change in foreign currency rates,

being a reasonable range of fluctuations for the period.

2021 2020

Capital

£’000 £’000

US Dollar

52,734 48,550

Taiwan Dollar

21,187 19,148

Euro

10,889 10,346

Canadian Dollar

10,579 6,573

Mexican Peso

9,239 9,706

Swedish Krone

8,643 –

Swiss Franc

– 9,318

Total

113,271 103,641

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. The Company’s stated objective is to achieve an above average dividend

yield, with long-term growth in dividends and capital ahead of inflation by investing principally in global equities.

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 country or sector. The allocation of assets to international

markets and the stock selection process, as detailed on pages 19 and 20, 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. The investments held by the Company are listed on various stock exchanges worldwide.

Price risk sensitivity. If market prices at the Statement of Financial Position date had been 10% higher or lower, which is a

reasonable range of annual price fluctuations, while all other variables remained constant, the return attributable to

Ordinary shareholders for the year ended 31 December 2021 would have increased/decreased by £159,083,000 (2020

– increase/decrease of £145,568,000) and equity would have increased/decreased by the same amount.

98 Murray International Trust PLC

(ii) 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 below.

Within Within Within Within Within More than

1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years Total

At 31 December 2021 £’000 £’000 £’000 £’000 £’000 £’000 £’000

Bank loans 60,000 60,000 30,000 – – – 150,000

Loan Notes – – – – – 50,000 50,000

Interest cash flows on bank loans 2,585 1,371 337 – – – 4,293

Interest cash flows on Loan Notes 1,120 1,120 1,120 1,120 1,120 5,040 10,640

Cash flows on other creditors 2,077 – – – – – 2,077

65,782 62,491 31,457 1,120 1,120 55,040 217,010

Within Within Within Within Within More than

1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years Total

At 31 December 2020 £’000 £’000 £’000 £’000 £’000 £’000 £’000

Bank loans 50,000 60,000 60,000 30,000 – – 200,000

Interest cash flows on bank loans 3,131 2,585 1,371 337 – – 7,424

Cash flows on other creditors 2,085 – – – – – 2,085

55,216 62,585 61,371 30,337 – – 209,509

Management of the risk. Liquidity risk is not considered to be significant as the Company’s assets comprise mainly readily

realisable securities, which can be sold to meet funding commitments if necessary. Short-term flexibility is achieved

through the use of loan and overdraft facilities (note 13).

(iii) Credit risk. This is failure of the counterparty to a transaction to discharge its obligations under that transaction that could

result in the Company suffering a loss.

Management of the risk

– where the Manager makes an investment in a bond, corporate or otherwise, the credit ratings of the issuer are taken

into account so as to manage the risk to the Company of default;

– investments in quoted bonds are made across a variety of industry sectors and geographic markets so as to avoid

concentrations of credit risk;

– transactions involving derivatives are entered into only with investment banks, the credit rating of which is taken into

account so as to minimise the risk to the Company of default;

– investment transactions are carried out with a number of brokers, whose credit-standing is reviewed periodically by the

Manager, and limits are set on the amount that may be due from any one broker;

– the risk of counterparty exposure due to failed trades causing a loss to the Company is mitigated by the daily review of

failed trade reports. In addition, both stock and cash reconciliations to the custodian’s records are performed daily to

ensure discrepancies are investigated in a timely manner. The Manager’s Compliance department carries out periodic

reviews of the custodian’s operations and reports its finding to the Manager’s Risk Management Committee;

– cash is held only with reputable banks with acceptable credit quality. 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.

Continued

Notes to the Financial Statements

Murray International Trust PLC 99

Credit risk exposure. In summary, compared to the amounts in the Statement of Financial Position, the maximum

exposure to credit risk at 31 December 2021 was as follows:

2021 2020

Balance Maximum Balance Maximum

Sheet exposure Sheet exposure

£’000 £’000 £’000 £’000

Non-current assets

Quoted preference shares and bonds at fair

value through profit or loss

148,479 148,479 190,730 190,730

Current assets

Other debtors

87 87 109 109

Accrued income

8,432 8,432 9,478 9,478

Cash and short-term deposits

8,705 8,705 3,208 3,208

165,703 165,703 203,525 203,525

None of the Company’s financial assets is secured by collateral or other credit enhancements.

Credit ratings. The table below provides a credit rating profile using Moodys credit ratings for the quoted preference

shares and bonds at 31 December 2021 and 31 December 2020:

2021 2020

£’000 £’000

14,235 14,901

Ba1

4,025 –

Baa1

13,601 15,365

Ba2

15,590 38,310

Baa2

32,127 32,707

Ba3

32,497 13,350

Baa3

– 17,292

Non-rated

36,404 58,805

148,479 190,730

100 Murray International Trust PLC

Whilst a substantial proportion of the fixed interest portfolio does not have a rating provided by Moodys, the Manager

undertakes an ongoing review of their suitability for inclusion within the portfolio as set out in “Investment Process” and

“Delivering the Investment Policy” on pages 19 and 20. At 31 December 2021 Moodys credit ratings agency did not provide

a rating for Ecuador bonds, Indian bonds, Turkish bonds and Irredeemable preference shares (2020 – Ecuador bonds,

Indian bonds, Turkish bonds and Irredeemable preference shares) held by the Company and were accordingly

categorised as non–rated in the table above. It was noted however that Fitch credit ratings agency does provide a B–

rating for Ecuador bonds with a value of £6,370,000 (2020 – £5,157,000 with a B– rating) and a BB– rating for Turkish bonds

with a value of £6,023,000 (2020 – £13,182,000 with a BB- rating).

Fair values of financial assets and financial liabilities. The fair value of borrowings has been calculated at £201,783,000 as at

31 December 2021 (2020 – £203,597,000) compared to a carrying amount in the financial statements of £199,814,000

(2020 – £199,805,000) (note 12). The fair value of each loan is determined by aggregating the expected future cash flows

for that loan discounted at a rate comprising the borrower’s margin plus an average of market rates applicable to loans

of a similar period of time and currency. The carrying value of all other assets and liabilities is an approximation of fair

value.

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. The fair value hierarchy shall have the following classifications:

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 in Level 1 that are observable (ie developed using market data) for the asset

or liability, either directly or indirectly.

Level 3: inputs are unobservable (ie for which market data is unavailable) for the asset or liability.

The financial assets and liabilities measured at fair value in the Statement of Financial Position are grouped into the fair value

hierarchy at the reporting date as follows:

Level 1 Level 2 Level 3 Total

As at 31 December 2021 Note £’000 £’000 £’000 £’000

Financial assets at fair value through profit or loss

Quoted equities a) 1,590,833 – – 1,590,833

Quoted preference shares b) – 7,637 – 7,637

Quoted bonds b) – 140,842 – 140,842

Total 1,590,833 148,479 – 1,739,312

Level 1 Level 2 Level 3 Total

As at 31 December 2020 Note £’000 £’000 £’000 £’000

Financial assets at fair value through profit or loss

Quoted equities a) 1,455,675 – – 1,455,675

Quoted preference shares b) – 7,488 – 7,488

Quoted bonds b) – 183,242 – 183,242

Total 1,455,675 190,730 – 1,646,405

Continued

Notes to the Financial Statements

Murray International Trust PLC 101

a) Quoted equities. The fair value of the Company’s investments in quoted equities has been determined by reference to

their quoted bid prices at the reporting date. Quoted equities included in Fair Value Level 1 are actively traded on

recognised stock exchanges.

b) Quoted preference shares and bonds. The fair value of the Company’s investments in quoted preference shares and bonds

has been determined by reference to their quoted bid prices at the reporting date. Investments categorised as Level 2 are

not considered to trade in active markets.

20. Capital management policies and procedures

The investment objective of the Company is to achieve an above average dividend yield, with long-term growth in dividends

and capital ahead of inflation by investing principally in global equities.

The capital of the Company consists of bank borrowings 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 planned level of gearing which takes into account the Investment Manager’s views on the market;

– the level of equity shares in issue; 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

period.

Details of the Company’s gearing facilities and financial covenants are detailed in note 13 of the financial statements. The

Company does not have any other externally imposed capital requirements.

21. Related party transactions and transactions with the Manager

Directors’ fees and interests. Fees payable during the year to the Directors and their interests in shares of the Company are

disclosed within the Directors’ Remuneration Report on page 63.

Transactions with the Manager. The Company has agreements with ASFML for the provision of management, 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.

In the opinion of the Directors on the basis of shareholdings advised to them, the Company has no immediate or ultimate

controlling party.

102 Murray International Trust PLC

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

The discount is the amount by which the share price is lower than the net asset value per share, expressed as a percentage of the net

asset value.

2021 2020

NAV per Ordinary share (p)

1,240.30 1,138.15

Share price (p)

1,156.00 1,130.00

Discount

(b-a)/a

–6.8% –0.7%

Dividend cover

Dividend cover measures the revenue return per share divided by total dividends per share, expressed as a ratio.

2021 2020

Revenue return per share

51.7p 46.6p

Dividends per share

55.0p 54.5p

Dividend cover

a/b

0.94x 0.86x

Dividend yield

The annual dividend per Ordinary share divided by the share price at the year end, expressed as a percentage.

2021 2020

Dividends per share

a 55.00p 54.50p

Share price

b 1,156.00p 1,130.00p

Dividend yield

a/b 4.8% 4.8%

Alternative Performance Measures

Murray International Trust PLC 103

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.

2021 2020

Borrowings (£’000)

199,814 199,805

Cash (£’000)

8,705 3,208

Amounts due to/(from) brokers (£’000)

– –

Shareholders’ funds (£’000)

1,561,066 1,461,827

Net gearing

(a-b+c)/d

12.2% 13.4%

Ongoing charges ratio (OCR)

The ongoing charges ratio has been calculated in accordance with guidance issued by the AIC as the total of investment

management fees and administrative expenses and expressed as a percentage of the average daily net asset values with debt at fair

value published throughout the year.

2021 2020

Investment management fees (£’000)

6,953 6,849

Administrative expenses (£’000)

1,752 1,966

Less: non-recurring charges

(£’000)

(74) (81)

Ongoing charges (£’000)

8,631 8,734

Average net assets (£’000)

1,510,301 1,346,488

Ongoing charges ratio (excluding look-through costs)

0.57% 0.65%

Look-through costs

0.02% 0.03%

Ongoing charges ratio (including look-through costs)

0.59% 0.68%

Professional services comprising new Director recruitment costs and legal fees considered unlikely to recur.

Calculated in accordance with AIC guidance issued in October 2020 to include the Company’s share of costs of holdings in investment companies on a look-through basis.

The ongoing charges ratio provided in the Company’s Key Information Document is calculated in line with the PRIIPs regulations, which

includes amongst other things, the cost of borrowings and transaction costs.

104 Murray International Trust PLC

Total return

NAV and share price 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 Reference Index, respectively.

Year ended 31 December 2021 NAV Price

Opening at 1 January 2021

1,138.2p 1,130.0p

Closing at 31 December 2021

1,240.3p 1,156.0p

Price movements

c=(b/a)-1

9.0% 2.3%

Dividend reinvestment

5.1% 4.9%

Total return

c+d

+14.1% +7.2%

Year ended 31 December 2020 NAV Price

Opening at 1 January 2020

1,190.0p 1,260.0p

Closing at 31 December 2020

1,138.2p 1,130.0p

Price movements

c=(b/a)-1

–4.4% –10.3%

Dividend reinvestment

5.3% 5.0%

Total return

c+d

+0.9% –5.3%

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. 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.

Alternative Performance Measures

Continued

Murray International Trust PLC 105

Corporate

Information

The Company’s Manager is

Aberdeen Asset Managers Limited, a

subsidiary of abrdn plc, whose group

companies as at 31 December 2021

had approximately £542 billion of

assets under management and

administration

The Company invests in Cisco Systems, a multinational conglomerate providing

networking hardware, software and telecommunications equipment

106 Murray International Trust PLC

Aberdeen Asset Managers Limited

The Company’s Manager is Aberdeen Asset Managers Limited, a subsidiary of abrdn plc, whose group companies as at

31 December 2021 had approximately £542 billion of assets under management and administration. The Manager has

its headquarters in Edinburgh and invests globally, operating from over 60 offices around the world. Its investment teams

are generally based in the markets or regions in which they invest; in the UK its main investment centres are in London

and Edinburgh.

The abrdn Global Equity Team

The global equity team at abrdn comprises thirteen individuals, predominantly based in Edinburgh, with two in the US.

This team leverages the investment analysis and research work conducted at the regional level within abrdn. While the

team can, and do, appraise investments as a combined group, the team is also arranged into smaller ‘pods’, driven by

product focus. The global equity income pod at abrdn comprises five individuals. The rationale for having small groups

focusing on various key client outcomes is that it allows research and idea generation to be explicitly focused on each

specific client outcome. It also allows for greater accountability and a more flexible and nimble decision making process.

Bruce Stout

Senior Investment Director

The management of the Company’s assets is led by Bruce

Stout who is assisted by Martin Connaghan and Samantha

Fitzpatrick. Bruce Stout is a Senior Investment Director on

the Global Equity Team which is responsible for the

construction of global equity portfolios. Bruce joined

Aberdeen Asset Managers Limited (or acquired

companies) in 1987 and has held a number of roles

including investment manager on the emerging markets

team. He has been directly involved in the management

of the Company’s assets since 1992 and Manager since

2004.

Martin Connaghan

Investment Director

Martin Connaghan is an Investment Director on the Global

Equity team. Martin joined Aberdeen Asset Managers

Limited (or acquired companies) in 1998 and has held a

number of roles including Trader, Credit Analyst and ESG

Analyst. He has been focused on the management of

global equity portfolios for the last fifteen years.

Samantha Fitzpatrick

Investment Director

Samantha Fitzpatrick is an Investment Director on the

Global Equity Team at abrdn. Samantha joined Aberdeen

Asset Managers (or acquired companies) in 1998 and has

been involved in the management of global equity

portfolios for the last fifteen years. She is a CFA Charter

holder.

Information about the Investment Mana

Murray International Trust PLC 107

The Investment Process, Philosophy

and Style

Idea Generation

The Manager’s scale affords coverage of a wide and

dynamic universe, with in-depth, locally-sourced insights

with over 1,000 investment professionals across the world

supporting fundamental stock research and insight

generation. Research coverage is organised by region

and on a sector basis, with analysts developing deep

expertise which enables them to identify investment

opportunities through fundamental knowledge at both the

sector and stock level. The Manager has excellent access

to the companies which it researches, through structured

meetings and regular conversations with key decision-

makers and conducts several thousand company

meetings per year, in addition to the many ESG

engagements undertaken with companies. The Manager

conducts over 6,000 company meetings each year and

maintains a coverage list of global stocks of 2,000 stocks

Research

The Manager has developed a proprietary research

platform used by all its equity, credit and ESG teams, giving

instant access to research globally. The research is

focused on four key areas:

· Foundations – the Manager analyses how the company

makes money, the attractiveness and characteristics of

its industry, and the strength and sustainability of the

economic ‘moat’. This includes a thorough evaluation of

the environmental, social and governance (ESG) risks

and opportunities of the company. Face-to-face

meetings anchor how the Manager understands and

challenges the key elements of a company’s

fundamentals: the evolution and growth of the business;

the sustainable competitive advantage; management’s

track record of execution and managing risk; past

treatment of minority shareholders; the balance sheet

and financials; and ESG risks and opportunities of the

company in question.

· Dynamics – the shorter- and longer-term dynamics of

the business that will be the key determinants of its

corporate value over time. Specifically the Manager

looks for changes in the factors driving the market price

of a stock, identifying the drivers that the wider market

may not be pricing in. Understanding the dynamics

behind these drivers allows the Manager to focus on the

factors that will drive shareholder returns from a

particular stock.

· Financials and Valuation – the Manager examines the

strengths and weaknesses of the company’s financials

including a thorough analysis of the balance sheet, cash

flow and accounting, the market’s perception of the

company’s future prospects and value, and its own

forecasts of future financials and how the stock should

be priced. This includes significant focus on the dividend

paying capability of each business, the potential for

dividend growth and the sustainability of the payout.

· Investment insight and risk – the Manager articulates its

investment thesis, explaining how it views a stock

differently from the market consensus and how the

Manager expects to crystallise value from the holding

over time.

Integrated ESG Analysis

The detailed analysis of the Manager’s embedded ESG

process is contained on pages 21 to 27.

Idea Capture

To ensure that the Manager captures the best ideas from

the global research platform, the Global Equity Team is

fully integrated into the regional research process. The

Team mirrors the sector specialisms across the various

regional desks and they contribute to, and participate in,

the investment debate of the stocks in their sector. Being

fully integrated allows the Team to be present at all stages

along the investment journey and build their own

conviction into the underlying investment cases.

The Team attends company meetings as well as the

regional teams’ sector review meetings, facilitating deep

knowledge of the companies and the degree of

conviction underpinning the investment insights. This

allows the Team to capture effectively the highest

conviction ideas and the most important news flow across

the research platform.

Peer Review

Having a common investment language facilitates

effective communication and comparison of investment

ideas through peer review which is a critical part of the

process. All investment ideas are subject to rigorous peer

review, both at regular meetings and on an ad hoc basis –

and all team members debate stocks, meet companies

from all industries, and given their dual fund manager /

analyst role are incentivised to fully participate in the

entire process.

Portfolio Construction/Risk Controls

Portfolios are built from the bottom up, prioritising high

conviction stock ideas in a risk aware framework, giving

clients access to the best investment ideas. Portfolio risk

budgets are derived from clients’ investment objectives

and required outcomes. Peer review is an essential

component of the construction process with dedicated

portfolio construction pods (smaller dedicated groups of

108 Murray International Trust PLC

senior team members that have clear accountability for

the strategy) debating stock holdings, portfolio structure

and risk profiles.

As an active equity investor the Manager has adopted a

principled portfolio construction process which actively

takes appropriate and intentional risk to drive return. The

largest component of the active risk will be stock-specific

risk, along with appropriate levels of diversification. Risk

systems monitor and analyse risk exposures across

multiple perspectives breaking down the risk within the

portfolio by industry and country factors, by currency and

macro factors, and by other fundamental factors (quality,

momentum, etc.). Consideration of risk starts at the stock

level with the rigorous company research helping the

Manager to avoid stock specific errors. The Manager

ensures that any sector or country risk is appropriately

sized and managed relative to the overall objectives of the

Company.

Operational Risk and Independent

Governance Oversight

Risk management is an integral part of the Manager’s

management process and portfolios are formally

reviewed on a regular basis with the Manager’s Global

Head of Equities, the Portfolio Managers, the Manager’s

Investment Governance & Oversight Team (IGO) and

members of the Manager’s Investment Risk Team. This

third party oversight both monitors portfolio risk and also

oversees operational risk to ensure client objectives

are met.

Information about the Investment Mana

Continued

Murray International Trust PLC 109

Keeping You Informed

For internet users, detailed data on the Company,

including price, performance information and a monthly

fact sheet is available from the Company’s website

(murray-intl.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.

Abrdn Social Media Accounts

Twitter: @abrdnTrusts

LinkedIn: abrdn Investment Trusts

Investor Warning

The Board has been made aware by the Manager that

some investors have received telephone calls from people

purporting to work for the Manager, 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 the Manager and

any third party making such offers has no link with the

Manager. The Manager 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 the Manager’s investor services centre using the

details provided below.

Dividend Tax Allowance

The annual tax-free personal allowance on dividend

income is £2,000 for the 2021/2022 tax year. Above this

amount, individuals will pay tax on their dividend income at

a rate dependent on their income tax bracket and

personal circumstances. The Company will provide

registered shareholders with a confirmation of dividends

paid by the Company and this should be included with any

other dividend income received when calculating and

reporting to HMRC total dividend income received. It is the

shareholder’s responsibility to include all dividend income

when calculating any tax liability.

Direct Investment in Shares

Investors can buy and sell shares in the Company directly

through a stockbroker or indirectly through a lawyer,

accountant or other professional adviser. Alternatively, for

retail clients, shares can be bought directly through the

abrdn Investment Plan for Children, abrdn Investment

Trusts ISA and abrdn Share Plan.

abrdn Investment Plan for Children

abrdn runs an Investment Plan for Children (the “Children’s

Plan”) which covers a number of investment companies

under its management including the Company. Anyone

can invest in the Children’s Plan, including parents,

grandparents and family friends (subject to the eligibility

criteria as stated within the terms and conditions). All

investments are free of dealing charges on the initial

purchase of shares, although investors will suffer the bid-

offer spread, which can, on some occasions, be a

significant amount. Lump sum investments start at £150

per trust, while regular savers may invest from £30 per

month. Investors simply pay Government Stamp Duty

(currently 0.5%) on all purchases. Selling costs are £10 +

VAT. There is no restriction on how long an investor need

invest in the Children’s Plan, and regular savers can stop or

suspend participation by instructing abrdn in writing at any

time. In common with other schemes of this type, all

investments are held in nominee accounts. Investors have

full voting and other rights of share ownership.

abrdn Share Plan

abrdn runs a Share Plan (the “Plan”) through which shares

in the Company can be purchased. There are no dealing

charges on the initial purchase of shares, although

investors will suffer the bid-offer spread, which can, on

some occasions, be a significant amount. Lump sum

investments start at £250, while regular savers may invest

from £100 per month. Investors simply pay Government

Stamp Duty (currently 0.5%). Selling costs are £10 + VAT.

There is no restriction on how long an investor need invest

in a Plan, and regular savers can stop or suspend

participation by instructing abrdn in writing at any time. In

common with other schemes of this type, all investments

are held in nominee accounts. Investors have full voting

and other rights of share ownership.

abrdn Investment Trusts ISA

An investment of up to £20,000 can be made in the tax

year 2021/2022. The annual ISA administration charge is

£24 + VAT, calculated annually and applied on 31 March

(or the last business day in March) and collected soon

thereafter either by direct debit or, if there is no valid direct

debit mandate in place, from the available cash in the Plan

prior to the distribution or reinvestment of any income, or,

where there is insufficient cash in the Plan, from the sale of

investments held in the Plan. Investors have full voting and

other rights of share ownership. Under current legislation,

investments in ISAs can grow free of capital gains tax.

Investor Information

110 Murray International Trust PLC

ISA Transfer to abrdn

You can choose to transfer previous tax year investments

to abrdn which can then be invested in the Company

while retaining your ISA wrapper. The minimum lump sum

for an ISA transfer is £1,000, subject to a minimum per trust

of £250.

Shareholder Enquiries

In the event of queries regarding their holdings of shares,

lost certificates dividend payments, registered details, etc

shareholders holding their shares in the Company directly

should contact the registrars, Link Asset Services at Link

Group, 10th Floor, Central Square, 29 Wellington Street,

Leeds LS1 4DL or Tel: 0371 664 0300 Lines are open 9.00

a.m. to 5.30 p.m. (London Time) Monday to Friday. Calls

may be recorded and monitored randomly for security

and training purposes. Changes of address must be

notified to the registrars in writing.

Any general enquiries about the Company should be

directed to the Company Secretary, Murray International

Trust PLC, 1 George Street, Edinburgh EH2 2LL or by email

at CEF.CoSec@abrdn.com.

If you have any questions about an investment held

through the abrdn Share Plan, abrdn Investment Trusts ISA

or abrdn Investment Plan for Children, please telephone

the Manager’s Customer Services Department on 0808

500 0040. Alternatively, email inv.trusts@abrdn.com or

write to abrdn Investment Trusts, PO Box 11020,

Chelmsford, Essex CM99 2DB.

Literature Request Service

For literature and application forms for the Company and

the abrdn range of investment trust products, please

telephone: 0808 500 4000. For information on the abrdn

Investment Plan for Children, abrdn Share Plan, abrdn

Investment Trusts ISA or an ISA Transfer to abrdn please

write to abrdn Investment Trust Administration, PO Box

11020, Chelmsford, Essex, CM99 2DB or telephone the

Manager’s Customer Services Department on 0808 500

00 40 (free from a UK landline). Terms and conditions for

the abrdn managed savings products can be found under

the literature section of invtrusts.co.uk.

Key Information Document (“KID”)

The KID relating to the Company and published by the

Manager can be found on the Manager’s website:

www.invtrusts.co.uk/en/fund-centre/

literature-order-form.

Online Dealing

There are a number of online dealing platforms for private

investors that offer share dealing, ISAs and other means to

invest in the Company. Real-time execution-only

stockbroking services allow you to trade online, manage

your portfolio and buy UK listed shares. These sites do not

give advice. Some comparison websites also look at

dealing rates and terms. Some well-known online

providers, which can be found through internet search

engines, include:

AJ Bell Youinvest; Barclays Smart Investor; Charles Stanley

Direct; Fidelity; Halifax; Hargreaves Lansdown; Interactive

Investor; Novia; Transact; and Standard Life.

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 and Financial

Advice Association at pimfa.co.uk.

Independent 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

Website: https://register.fca.org.uk/

Email: register@fca.org.uk

Suitable for Retail/NMPI Status

The Company’s securities are intended for investors

primarily in the UK (including retail investors), professional-

advised private clients and institutional investors who are

wanting to benefit from the growth prospects of global

companies by investment in a relatively risk averse

investment trust 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

Continued

Murray International Trust PLC 111

The Company currently conducts its affairs so that its

securities can be recommended by a financial adviser to

ordinary retail investors in accordance with the Financial

Conduct Authority’s (FCA) rules in relation to non-

mainstream pooled investments (NMPIs) and intends to

continue to do so for the foreseeable future. The

Company’s shares are excluded from the FCA’s

restrictions which apply to non-mainstream investment

products because they are shares in an investment trust.

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.

AIFMD Disclosures (Unaudited)

The Company has appointed Aberdeen Standard Fund

Managers Limited as its alternative investment fund

manager and BNY Mellon as its depositary under the

AIFMD. abrdn and the Company are required to make

certain disclosures available to investors in accordance

with the Alternative Investment Fund Managers Directive

(“AIFMD”). Those disclosures that are required to be made

pre-investment are included within a pre-investment

disclosure document (“PIDD”) which can be found on the

Company’s website murray-intl.co.uk. There have been

no material changes to the disclosures contained within

the PIDD since its last publication in March 2021.

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

are included in the Strategic Report.

· None of the Company’s assets is 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 Company’s Investment Policy risk limits, 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 ASFML.

· All authorised Alternative Investment Fund Managers

are required to comply with the AIFMD Remuneration

Code. In accordance with the Remuneration Code, the

AIFM’s remuneration policy is available from the

Company Secretaries, Aberdeen Asset Management

PLC on request (see contact details on page 121) and

the remuneration disclosures in respect of the AIFM’s

reporting period for the year ended 31 December 2021

are available on the Company’s website.

Leverage

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 31 December 2021 1.24 1.25

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

gearing agreements. 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 ASFML 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 pages 109 to 111 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 Aberdeen Standard Fund Managers

Limited which is authorised and regulated by the Financial

Conduct Authority

112 Murray International Trust PLC

ASFML

Aberdeen Standard Fund Managers Limited is a wholly

owned subsidiary of abrdn PLC and acts as the Alternative

Investment Fund Manager for the Company. ASFML is

authorised and regulated by the Financial Conduct

Authority.

AIC

The Association of Investment Companies – the AIC is the

trade body for closed-ended investment companies

(theaic.co.uk).

AIFMD

The Alternative Investment Fund Managers Directive – The

AIFMD is European legislation which created a European-

wide framework for regulating managers of ‘alternative

investment funds’ (AIFs). It is designed to regulate any fund

which is not a UCITS (Undertakings for Collective

Investments in Transferable Securities) fund and which is

managed/marketed in the EU. The Company has been

designated as an AIF.

Alternative Performance Measure or APM

An alternative performance measure is a financial

measure of historical or future financial performance,

financial position, or cash flows, other than a financial

measure defined or specified in the applicable financial

reporting framework.

Common Reporting Standards or CRS

Under CRS the Company is required to provide personal

information to HMRC on certain investors that purchase

shares in the Company. This information will be provided

annually to the local tax authority of the tax residencies of

a number of non UK based certificated shareholders and

corporate entities.

Discount

The amount by which the market price per share of an

investment trust is lower than the NAV per share. The

discount is normally expressed as a percentage of the

NAV per share.

Disclosure Guidance and Transparency

Rules or DTRs

The DTRs are issued by the Financial Conduct Authority

(FCA) and contain requirements for publishing and

distributing annual financial reports, half-yearly financial

reports and other regulatory statements, and are

applicable to investment companies which are listed on

the main market of the London Stock Exchange.

Dividend Cover

Revenue return per share divided by dividends per share

expressed as a ratio.

Dividend Entitlements

The Ordinary shares carry the right to receive the revenue

profits (including accumulated revenue reserves) of the

Company available for distribution as dividend and

determined to be distributed by way of interim and/or

final dividend and at such times as the Directors may

determine.

Electronic Communications

Any registered shareholders wishing to receive future

communications from the Company electronically should

contact Link Asset Services at Link Group, 10th Floor,

Central Square, 29 Wellington Street, Leeds LS1 4DL

or Tel: 0371 664 0300 (lines are open 9.00 a.m. -5.30 p.m.

Mon-Fri).

Environmental, Social and Governance

or ESG

ESG refers to the three key factors that can be used to

measure the sustainability and impact on society of an

investee company.

Gearing

Investment Trusts can ‘gear’ or borrow money to invest

but unit trusts are limited in this respect. Gearing can

magnify a fund’s return, however, a geared investment is

riskier because of the borrowed money.

Investment Manager or Manager

The Company’s Alternative Investment Fund Manager is

Aberdeen Standard Fund Managers Limited (“ASFML”)

which is authorised and regulated by the Financial

Conduct Authority. Day-to-day management of the

portfolio is delegated to Aberdeen Asset Managers

Limited (“AAM”). AAM and ASFML are collectively referred

to as the “Investment Manager” or the “Manager”.

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 anticipated

performance returns cannot be guaranteed.

Glossary of Terms

Murray International Trust PLC 113

Key Performance Indicator or KPI

In accordance with the Companies Act 2006, the Strategic

Report section of the Annual Report is required to contain

Key Performance Indicators. These are factors by

reference to which the development, performance or

position of the business of the Company can be measured

effectively.

Listing Rules

The Financial Conduct Authority’s (FCA) Listing Rules are a

set of regulations that are applicable to all companies that

are listed on the London Stock Exchange.

MiFID

The Markets in Financial Instruments Directive 2004/39/EC

(MiFID)is a European Union law that provides harmonised

regulation for investment services across the 31 member

states of the European Economic Area.

Net Asset Value or NAV

The value of total assets less liabilities. Liabilities for this

purpose includes current and long-term liabilities. The

NAV divided by the number of shares in issue produces the

NAV per share.

Net Gearing/(Cash)

Net gearing/(cash) is calculated by dividing total assets

(as defined below) less cash or cash equivalents by

shareholders’ funds expressed as a percentage.

Ongoing Charges Ratio (OCR)

Ratio of expenses as percentage of average daily

shareholders’ funds calculated as per the AIC’s industry

standard method.

PIDD or Pre-Investment

Disclosure Document

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’), a copy of which

can be found on the Company’s website.

Premium

The amount by which the market price per share of an

investment trust exceeds the NAV per share. The premium

is normally expressed as a percentage of the NAV per

share.

Prior Charges

The name given to all borrowings including debentures,

long-term loans and short-term loans and overdrafts

used for investment purposes, reciprocal foreign currency

loans, currency facilities to the extent that they are drawn

down, index-linked securities, and all types of preference

or preferred capital and the income shares of split capital

trusts, irrespective of the time until repayment.

Reference Index

The Company does not have a Benchmark. However,

performance is measured against a number of measures

including a Reference Index, the FTSE All World TR Index,

which was adopted in April 2020. Given the composition

of the portfolio and the Manager’s investment process, it is

likely that the Company’s investment performance may

diverge, possibly significantly, from this Reference Index.

Performance prior to 27 April 2020 was measured against

a composite Benchmark Index (40% of the FTSE World UK

Index and 60% of the FTSE World ex-UK Index) up to 27

April 2020 and the FTSE All World TR Index thereafter.

Total Assets

The total assets less current liabilities as shown on the

Balance Sheet with the addition of Prior Charges (as

defined above).

Total Return

Total Return involves reinvesting the net dividend in the

month that the share price goes xd. The NAV Total Return

involves investing the same net dividend in the NAV of the

Company on the date to which that dividend was earned,

eg quarter end, half year or year end date.

Voting Rights

In accordance with the Articles of Association of the

Company, on a show of hands, every member (or duly

appointed proxy) present at a general meeting of the

Company has one vote; and, on a poll, every member

present in person or by proxy shall have one vote for every

25p nominal amount of Ordinary shares held.

Winding-Up Entitlements

On a winding up of the Company, any surplus assets

available after payment of all debts and satisfaction of all

liabilities of the Company shall be applied in repaying the

Ordinary shareholders the amounts paid up on such

shares. Any surplus shall be divided among the holders of

Ordinary shares pari passu according to the amount paid

up on such shares respectively.

114 Murray International Trust PLC

General

The 2022 Annual General Meeting of the Company

will be held at 12:30 p.m. on 22 April 2022 at

The Mermaid Conference Centre, Puddle Dock,

Blackfriars, London EC4V 3DB

Murray International Trust PLC 115

NOTICE IS HEREBY GIVEN that the one hundred and fourteenth Annual General Meeting of Murray International Trust

PLC (registered in Scotland under company number SC006705) will be held at 12:30 p.m. on 22 April 2022 at The

Mermaid Conference Centre, Puddle Dock, Blackfriars, London EC4V 3DB for the following purposes:

Ordinary Business

As ordinary business to consider and, if thought fit, pass the following resolutions as Ordinary Resolutions:

1. To receive the Directors’ Report, the Auditor’s Report and audited financial statements for the year ended 31

December 2021.

2. To receive and adopt the Directors’ Remuneration Report for the year ended 31 December 2021 (other than the

Directors’ Remuneration Policy).

3. To re-elect Ms C Binyon* as a Director of the Company.

4. To re-elect Mrs A Mackesy* as a Director of the Company.

5. To elect Mr N Melhuish* as a Director of the Company.

6. To re-elect Mr D Hardie* as a Director of the Company.

7. To re-appoint BDO LLP as independent auditor of the Company.

8. To authorise the Directors to fix the remuneration of the independent auditor.

9. THAT a final dividend of 19.0p per Ordinary share in respect of the year ended 31 December 2021 be paid on 18 May

2022 to holders of the Ordinary shares of 25p in the capital of the Company on the register at close of business on 8

April 2022.

Special Business

As special business to consider and, if thought fit, pass the following resolutions in the case of resolution 10 as an Ordinary

Resolution and in the case of resolutions 11 and 12 as Special Resolutions:

Authority to Allot

10. THAT the Directors be generally and unconditionally authorised in accordance with Section 551 of the Act to

exercise all the powers of the Company to allot shares in the Company and to grant rights to subscribe for, or to

convert any security into, shares in the Company up to an aggregate nominal amount of £3,135,875 (representing

10% of the total Ordinary share capital of the Company in issue on 3 March 2022) during the period expiring on the

date of the next Annual General Meeting of the Company or on 30 June 2023, whichever is the earlier, but so that this

authority, unless previously revoked, varied or renewed, shall allow the Company to make offers or agreements

before the expiry of this authority which would or might require shares to be allotted or rights to be granted after

such expiry and the Directors may allot shares and grant rights in pursuance of such an offer or agreement as if such

authority had not expired.

Disapplication of Pre-emption Rights

11. THAT the Directors be and they are hereby empowered, pursuant to Sections 570 and 573 of the Act, to allot equity

securities (as defined in Section 560 of the Act) for cash pursuant to the authority given in accordance with Section

551 of the Act by Resolution Number 10 as if Section 561 of the Act did not apply to any such allotment, provided that

this power shall be limited to the allotment of equity securities:-

i. during the period expiring on the date of the next Annual General Meeting of the Company or on 30 June 2023,

whichever is earlier, but so that this power shall, unless previously revoked, varied or renewed, enable the

Company to make offers or agreements before the expiry of this power which would or might require equity

securities to be allotted after the expiry of this power and the Directors may allot equity securities in pursuance

of such an offer or agreement as if such power had not expired;

Notice of Annual General Meetin

116 Murray International Trust PLC

ii. up to an aggregate nominal amount of £3,135,875 (representing 10% of the total Ordinary share capital of the

Company in issue on 3 March 2022); and

iii. in the circumstances detailed in the section headed “Issue of Shares” on page 59 of the Annual Report and at a

price not less than 0.5% above the net asset value per share from time to time (as determined by the Directors

and excluding Treasury shares).

This power applies to a sale of Treasury shares which is an allotment of equity securities by virtue of Section 560(3) of the

Act as if in the first paragraph of this Resolution the words ‘pursuant to the authority given in accordance with Section 551

of the Act by Resolution Number 10’ were omitted.

Authority to Make Market Purchases of Shares

12. THAT the Company be 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 fully paid Ordinary shares of 25p each in the capital of the Company on such terms and in such

manner as the Directors from time to time determine, PROVIDED ALWAYS THAT:

i. the maximum number of shares hereby authorised to be purchased shall be an aggregate of 18,802,709

Ordinary shares or, if less, the number representing 14.99% of the issued Ordinary share capital of the Company

(excluding shares held in Treasury) as at the date of the passing of this Resolution;

ii. the minimum price which may be paid for a share shall be 25p;

iii. the maximum price (exclusive of expenses) which may be paid for a share shall be the higher of (i) an amount

equal to 105% of the average of the middle market quotations for a share taken from, and calculated by

reference to, the Daily Official List of the London Stock Exchange 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 at the time the purchase is carried out;

iv. any purchase of shares will be made in the market for cash at prices below the prevailing net asset value per

share (as determined by the Directors);

v. the authority hereby conferred shall expire at the conclusion of the next Annual General Meeting of the

Company or on 30 June 2023, whichever is earlier, unless such authority is previously revoked, varied or

renewed prior to such time; and

vi. the Company may, at any time prior to the expiry of the authority hereby conferred, enter into a contract or

contracts to purchase shares under such authority which would or might be completed or executed wholly or

partly after the expiration of such authority and may make a purchase of shares pursuant to any such contract

or contracts as if the authority conferred hereby had not expired.

* The biographies of the Directors and reasons for re-election are detailed on pages 52 and 53 of this Annual Report.

By order of the Board

Aberdeen Asset Management PLC

Secretary

3 March 2022

Registered Office

1 George Street

Edinburgh

EH2 2LL

Notice of Annual General Meetin

Continued

Murray International Trust PLC 117

Notes

i. Only those shareholders registered in the register of members of the Company at close of business on 20 April

2022 shall be entitled to attend and/or vote at the Annual General Meeting in respect of the number of shares

registered in their name at that time (“the specified time”). If the Meeting is adjourned to a time not more than 48

hours after the specified time applicable to the original Meeting, that time will also apply for the purpose of

determining the entitlement of shareholders to attend and/or vote at the adjourned meeting. If the Meeting is

adjourned for a longer period, the time by which a person must be entered on the register of members of the

Company in order to have the right to attend and/or vote at the adjourned meeting is the close of business two

days (excluding non working days) prior to the time of the adjourned meeting. Changes to entries on the register

of members after the relevant deadline shall be disregarded in determining the rights of any person to attend

and/or vote at the Annual General Meeting.

ii. As at 3 March 2022 (being the last practicable day prior to the publication of this Notice), the Company’s issued

share capital consisted of 125,435,018 Ordinary shares carrying one vote each on a poll and 3,976,985 Treasury

shares. Therefore, the total voting rights in the Company as at 3 March 2022 are 125,435,018 and the Treasury

shares represent 3.1% of the total issued Ordinary share capital (inclusive of treasury shares).

iii. A shareholder entitled to attend and vote at the Annual General Meeting is entitled to appoint one or more proxies

to attend, speak and vote instead of him or her, provided that if two or more proxies are appointed, each proxy

must be appointed to exercise the rights attaching to different shares. A Form of Proxy is enclosed with this Notice.

A proxy need not be a shareholder of the Company. However, given the restrictions on attendance this year, only

the Chairman of the meeting should be appointed as your proxy. If another individual is appointed, it is likely that

they will be refused entry to the Annual General Meeting and will be unable to represent you and your vote.

Completion and return of the Form of Proxy will not preclude shareholders from attending or voting at the Annual

General Meeting, if they so wish but please note the general restriction on attendance this year. Details of how to

appoint the Chairman of the Meeting as your proxy using the Form of Proxy are set out in the note to the Form of

Proxy. In the event that a Form of Proxy is returned without an indication as to how the proxy shall vote on the

resolutions, the proxy will exercise his or her discretion as to whether, and if so how, he or she votes. You may also

submit your proxy electronically using The Share Portal service at signalshares.com. Shareholders can use this

service to vote or appoint a proxy online. The same voting deadline of 48 hours (excluding non-working days)

before the time of the meeting applies as if you were using your Personalised Voting Form to vote or appoint a

proxy by post to vote for you. Shareholders will need to use the unique personal identification Investor Code, this

number can be found on your share certificate. Shareholders should not show this information to anyone unless

they wish to give proxy instructions on their behalf.

iv. To be valid, the Form of Proxy, together with the power of attorney or other authority, if any, under which it is

executed (or a notarially certified copy of such power or authority) must be deposited with the Company’s

Registrar, for this purpose being PXS 1, Link Group, Central Square, 29 Wellington Street, Leeds, LS1 4DL, as soon as

possible, but in any event not later than 3.00 p.m. on 20 April 2022. If you have any queries relating to the completion

of the Form of Proxy, please contact Link Group on 0371 664 0300 (lines are open 9.00am to 5.30pm Mon-Fri). Link

Group cannot provide advice on the merits of the business to be considered nor give any financial, legal or tax

advice. Alternatively, if the shareholder holds his or her shares in uncertificated form (i.e. in CREST) they may vote

using the CREST System (see note (x) below).

v. A vote given in accordance with the terms of an instrument of proxy shall be valid notwithstanding the previous

death or insanity of the principal or revocation of the proxy or of the authority under which the proxy was executed,

or the transfer of the share in respect of which the proxy is given, provided that no intimation in writing of such

death, insanity, revocation or transfer as aforesaid shall have been received by the Company at its registered office

or the address specified in note (iv) above before the commencement of the meeting or adjourned meeting at

which the proxy is used.

vi. Where there are joint holders of any share, any one of such persons may vote at any meeting, and if more than one

of such persons is present at any meeting personally or by proxy, the vote of the senior holder who tenders the vote

shall be accepted to the exclusion of the votes of other joint holders and, for this purpose, seniority will be

determined by the order in which the names stand in the register of members of the Company.

118 Murray International Trust PLC

vii. Any person to whom this notice is sent who is a person nominated under Section 146 of the Companies Act 2006 to

enjoy information rights (a “Nominated Person”) may, under an agreement between him/her and the shareholder

by whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for

the Annual General Meeting. If a Nominated Person has no such proxy appointment right or does not wish to

exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the

exercise of voting rights. Nominated Persons should also remember that their main point of contact in terms of

their investment in the Company remains the shareholder who nominated the Nominated Person to enjoy

information rights (or, perhaps the custodian or broker who administers the investment on their behalf). Nominated

Persons should continue to contact that shareholder, custodian or broker (and not the Company) regarding any

changes or queries relating to the Nominated Person’s personal details and interests in the Company (including

any administrative matter). The statement of the rights of shareholders in relation to the appointment of proxies in

notes (iii) to (v) does not apply to Nominated Persons. The rights described in these notes can only be exercised by

shareholders of the Company.

viii. Any corporation which is a shareholder may authorise such person as it thinks fit to act as its representative at this

meeting. Any person so authorised shall be entitled to exercise on behalf of the corporation which he represents

the same powers (other than to appoint a proxy) as that corporation could exercise if it were an individual

shareholder (provided, in the case of multiple corporate representatives of the same corporate shareholder, they

are appointed in respect of different shares owned by the corporate shareholder or, if they are appointed in

respect of the same shares, they vote the shares in the same way). To be able to attend and vote at the Annual

General Meeting, corporate representatives will be required to produce prior to their entry to the Meeting evidence

satisfactory to the Company of their appointment. However, given the restrictions on attendance at the Annual

General Meeting this year, shareholders should note that any corporate representative attempting to attend the

Annual General Meeting in person is likely to be refused entry and any corporations which are members are

therefore advised to instead appoint the Chairman of the meeting as their proxy.

ix. To allow effective constitution of the Annual General Meeting, if it is apparent to the Chairman that no shareholders

will be present in person or by proxy, other than by proxy in the Chairman’s favour, then the Chairman may appoint

a substitute to act as proxy in his stead for any shareholder, provided that such substitute proxy shall vote on the

same basis as the Chairman.

x. Notes on CREST Voting:

1. CREST Members who wish to appoint a proxy or proxies by utilising the CREST electronic proxy appointment

service may do so by utilising the procedures described in the CREST Manual, which is available to download

from the Euroclear UK & Ireland (“Euroclear”) website (www.euroclear.com/CREST). CREST personal members

or other CREST sponsored members, and those CREST members who have appointed voting service

provider(s) should contact their CREST sponsor or voting service provider(s) who will be able to take the

appropriate action on their behalf.

2. In order for a proxy appointment or instruction made using the CREST system to be valid, the appropriate CREST

message (a “CREST proxy instruction”) must be properly authenticated in accordance with Euroclear’s

specifications and must contain the information required for such instructions, as described in the CREST

Manual. To appoint a proxy or to give or amend an instruction to a previously appointed proxy via the CREST

system, the CREST message must be received by the issuer’s agent RA10 by 12:30 p.m. on 20 April 2022. For this

purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the

message by the CREST applications Host) from which the issuer’s agent is able to retrieve the message. CREST

members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear

does not make available special procedures in CREST for any particular messages. 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 CREST sponsored

member or has appointed a voting service provider(s), to procure that his CREST sponsor or voting service

provider(s) takes(s)) such action as shall be necessary to ensure that a message is transmitted by means of the

CREST system by a particular time. For further information on CREST procedures, limitations and system timings

please refer to the CREST Manual. The Company may treat as invalid a proxy appointment sent by CREST in the

circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001. In any case, a

proxy form must be received by the Company’s registrars no later than 12:30 p.m. on 20 April 2022.

Continued

Notice of Annual General Meetin

Murray International Trust PLC 119

xi. Shareholders are advised that unless otherwise provided, the telephone numbers and website addresses which

may be set out in this Notice or the Form of Proxy/Letter of Direction are not to be used for the purpose of serving

information or documents on the Company including the service of information or documents relating to

proceedings at the Company’s Annual General Meeting. If the Chairman, as a result of any proxy appointments, is

given discretion as to how the votes the subject of those proxies are cast and the voting rights in respect of those

discretionary proxies, when added to the interests in the Company’s shares already held by the Chairman, result in

the Chairman holding such number of voting rights that he has a notifiable obligation under the Disclosure

Guidance and Transparency Rules, the Chairman will make the necessary notifications to the Company and the

Financial Conduct Authority. As a result any person holding 3% or more of the voting rights in the Company who

grants the Chairman a discretionary proxy in respect of some or all of those voting rights and so would otherwise

have a notification obligation under the Disclosure Guidance and Transparency Rules, need not make a separate

notification to the Company and the Financial Conduct Authority.

xii. In accordance with Section 311A of the Companies Act 2006, the contents of this notice of Meeting, details of the

total number of shares in respect of which members are entitled to exercise voting rights at the Annual General

Meeting and, if applicable, any members’ statements, members’ resolutions or members’ matters of business

received by the Company after the date of this notice will be available on the Company’s website murray-intl.co.uk.

xiii. Pursuant to Section 319A of the Companies Act 2006, the Company must cause to be answered at the Annual

General Meeting any question relating to the business being dealt with at the Annual General Meeting which is put

by a shareholder attending the Meeting, except in certain circumstances, including if it is undesirable in the interests

of the Company or the good order of the Meeting that the question be answered or if to do so would involve the

disclosure of confidential information.

xiv. Shareholders should note that it is possible that, pursuant to requests made by shareholders of the Company under

Section 527 of the Companies Act 2006, the Company may be required to publish on a website a statement setting

out any matter relating to: (i) the audit of the Company’s accounts (including the auditor’s report and the conduct

of the audit) that are to be laid out before the Meeting; or (ii) any circumstance connected with an auditor of the

Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in

accordance with Section 437 of the Companies Act 2006, that the shareholders propose to raise at the 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 that the time when it makes the statement available on the website. The business

which may be dealt with at the Meeting includes any statement that the Company has been required under

Section 527 of the Companies Act 2006 to publish on the website.

xv. Participants in the abrdn Share Plan, Plan for Children and ISA are entitled to vote by completing the enclosed

Letter of Direction and returning it to the Company’s registrars.

xvi.

The Board is hopeful that the 2022 AGM will be an in-person meeting. However, given the evolving nature of the

Covid-19 pandemic, should circumstances change significantly before the time of the AGM, the Company will

notify shareholders of any changes to the AGM arrangements by updating the Company’s website at murray-

intl.co.uk and through an RIS announcement, where appropriate, as early as is possible before the date of the

meeting. Shareholders should note that if law or Government guidance so requires at the time of the meeting, the

Chairman of the Meeting will limit, in his sole discretion, the number of individuals in attendance at the meeting and

may be required to impose entry restrictions on certain persons wishing to attend the meeting in order to ensure

the safety of those attending the meeting and to satisfy any requirements mandated by the venue managers.

120 Murray International Trust PLC

Stock Exchange Codes SEDOL ISIN

Ordinary shares of 25p each 0611190 GB0006111909

Annual General Meeting

The Annual General Meeting will be on Friday 22 April 2022 at 12:30 p.m. at The Mermaid Conference Centre, Puddle

Dock, Blackfriars, London EC4V 3DB.

Online Shareholder Presentation

The Directors will be holding an Online Shareholder Presentation on Thursday 7 April 2022 at 11:00 a.m.. Further details

and how to register are included in the Chairman’s Statement.

Recent Ordinary Share Capital History

Shares Issued Share Buybacks Shares in Issue

Year ended 31 December Ordinary 25p Ordinary 25p Ordinary 25p

2012 10,145,888 n/a 121,283,242

2013 3,840,500 n/a 125,126,207

2014 2,232,500 n/a 127,361,901

2015 130,000 n/a 127,601,952

2016 155,625 1,081,463 127,484,238

2017 301,642 n/a 127,785,880

2018 357,665 n/a 128,143,545

2019 1,188,458 n/a 129,332,003

2020 80,000 973,341 128,438,662

2021 - 2,576,806 125,861,856

History

Murray International Trust PLC started its life in 1907 as The Scottish Western Investment Company Limited. The Scottish

Western of the early days was very highly geared but it was mainly invested in bonds, though the international spread

resembled today’s, with countries such as Argentina, China, Japan, Canada and many others appearing in the portfolio.

Although the range of currencies was much smaller, multi currency or even gold-backed bonds were commonplace, as

many of the era’s bond certificates show. The big move into equities came after the 1930s slump, when bond defaults

forced the purchase of higher yielding equities to fund the costs of the Company’s gearing. The Managers were not slow

to spot an opportunity, but it started as Hobson’s choice, and was only later hailed as brilliant foresight.

In 1929 just under 20% of the assets were in equities, in 1940 38%, in 1948 51% of the assets, which were still only £2.65

million. After deducting the preference shares (which were repaid in 1999) and debentures, the Company was

effectively over 100% geared into equities by the start of the great post war boom. After a number of amalgamations,

the Company emerged as a generalist investment trust. However, there was an excess of trusts with a similar broad

remit, so towards the end of the 1970s the Board defined the investment brief more narrowly as the achievement of

growth in income and capital through a well diversified portfolio. Symbolised by the name change from Murray Western

to Murray International Trust PLC in 1984, the focus has since been on a relatively high yielding portfolio of equities in a

well diversified mix of world markets.

In 2008 the Board circulated to all shareholders a short booklet to commemorate the centenary of the incorporation of

the Company on 18 December 1907. In 2018 the Centenary Booklet was updated. Copies are available on the website,

murray-intl.co.uk or from the Company Secretary.

Shareholder Information

Murray International Trust PLC 121

Directors

D Hardie (Chairman)

C Binyon

A Mackesy (Senior Independent Director)

N Melhuish

Secretaries and Registered Office

Aberdeen Asset Management PLC

1 George Street

Edinburgh EH2 2LL

E-mail: CEF.CoSec@abrdn.com

Registered in Scotland as an Investment

Company

Company Number SC006705

Website

murray-intl.co.uk

Points of Contact

The Chairman, the Senior Independent Director and the

Company Secretary at the registered office of the

Company

Email: DavidHardie.Chairman@murray-intl.co.uk

Manager

Aberdeen Asset Managers Limited

Customer Services Department: 0808 500 0040

(free when dialling from a UK landline)

AIFM

Aberdeen Standard Fund Managers Limited

Broker

Stifel Nicolaus Europe Limited

Registrars

Link Asset Services

Link Group

10th Floor, Central Square

29 Wellington Street

Leeds LS1 4DL

Tel: 0371 664 0300

(lines are open 9.00am-5.30pm Mon-Fri)

Tel International: (+44 208 639 3399)

E-mail: enquiries@linkgroup.co.uk

Share portal: signalshares.com

Depositary

The Bank of New York Mellon (International) Limited

Independent Auditor

BDO LLP

United States Internal Revenue Service

FATCA Registration Number (GIIN)

8Y8Z2N.99999.SL.826

Legal Entity Identifier (LEI)

549300BP77JO5Y8LM5