Temple Bar Investment Trust PLC Annual General Meeting

Alastair Mundy Target audience This document is being provided for informational purposes only. Circulation must be restricted accordingly. Nothing herein should be construed as an offer to enter into any contract, investment advice, a recommendation of any kind, a solicitation of clients, or an offer to invest in any particular fund, product, investment vehicle or derivative.

General risks The value of investments, and any income generated from them, can fall as well as rise. Where charges are taken from capital, this may constrain future growth. Past performance is not a reliable indicator of future results. If any currency differs from the investor's home currency, returns may increase or decrease as a result of currency fluctuations. Investment objectives and performance targets may not necessarily be achieved, losses may be made.

Specific risks

Borrowing/leverage risk: The Company can borrow additional money to invest, known as leverage. This increases the exposure of the Company to markets above and beyond its total net asset value. This can help to increase the rate of growth of the fund but also cause losses to be magnified. Charges to capital risk: A portion (60%) of the Company’s expenses are charged to its capital account rather than to its income, which has the effect of increasing income (which may be taxable) whilst reducing its capital to an equivalent extent. This could constrain future capital and income growth. Company share price risk: The Company’s share price is determined by supply and demand for such shares in the market as well as the net asset value per share. The share price can therefore fluctuate and may represent a discount or premium to the net asset value per share. This can mean that the price of an ordinary share can move independently of the market. Interest rate: The value of fixed income investments (e.g. bonds) tends to decrease when interest rates and/or inflation rises. Equity investment: The value of equities (e.g. shares) and equity-related investments may vary according to company profits and future prospects as well as more general market factors. In the event of a

company default (e.g. bankruptcy), the owners of their equity rank last in terms of any financial payment from that company. Target Target audience

2 Confidential | Investec Asset Management Performance Update on request

NAV Total Return performance over 5 years

160 Temple Bar FTSE All-Share 150

140

130

120

110

100

90 Feb 13 Feb 14 Feb 15 Feb 16 Feb 17 Feb 18

Past performance figures are not audited and should not be taken as a guide to the future. Source: Morningstar, in GBP, 28 February 2018, using cum income NAV, debt at market value.

4 Confidential | Investec Asset Management Update on request

NAV Total Return performance over 10 years

290 Temple Bar FTSE All-Share

240

190

140

40 Feb-08 Feb-09 Feb-10 Feb-11 Feb-12 Feb-13 Feb-14 Feb-15 Feb-16 Feb-17 Feb-18

Past performance figures are not audited and should not be taken as a guide to the future. Source: Datastream, in GBP, 28 February 2018, using ex income NAV, debt at par.

5 Confidential | Investec Asset Management Update on request

Temple Bar Investment Trust Attribution analysis

12 month top and bottom 10 attribution analysis to 28 February 2018

Grafton Group Plc 1.0 SIG plc 0.9 British American Tobacco p.l.c. * 0.7 Games Workshop Group PLC 0.7 Shire PLC * 0.7 easyJet plc 0.6 Computacenter Plc 0.5 Reckitt Benckiser Group plc * 0.4 Imperial Brands PLC 0.4 National Grid plc * 0.3 Rio Tinto plc -0.3 Royal Dutch Shell Plc Class B -0.3 Global X Silver Miners ETF -0.4 Travis Perkins plc -0.4 Capita plc -0.4 Drax Group plc -0.4 ETFS Physical Silver -0.5 Centrica plc -0.5 Signet Jewelers Limited -0.5 GlaxoSmithKline plc -0.7 -1.5% -1.0% -0.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5%

Change in position (%)

Source: Investec Asset Management, 28 February 2018. * Indicates the security is not held. The portfolio may change significantly over a short period of time. This is not a buy, sell or hold recommendation for any particular security.

6 Confidential | Investec Asset Management How we invest

Investment is most intelligent when it is most business-like ● We research assets that are potentially mispriced

● We look for companies that we can understand and value with some measure of confidence

● We value stocks on a through-the-cycle basis with particular attention to downside risks ● We can take a substantial amount of short-term pain (falling stock price) if we are confident our valuation is correct

Our approach requires patience (and capacity to bear short-term pain) but it is inextricably linked to opportunity

7 Confidential | Investec Asset Management The type of idea we pre-select for our shortlist What are we attracted to?

Hidden assets Special situations Fallen angels Quality cyclicals Deep value  Mediocre businesses at very  Cannot be computerised  Spin offs  Often old market darlings  Industrials and financials attractive prices

 Re-capitalisations  Large but non-fatal blow  Industry down-turn

 Offers opportunity to buy the best

Examples Examples Examples Examples Examples

 Capita  Capita  Next  Lloyds Banking  SIG

 Royal Bank of Scotland  Direct Line  Tesco  Travis Perkins  Centrica

 Marks & Spencer  Royal Bank of Scotland  Land Securities

 easyJet  CRH

 Forterra

 Aggreko

The portfolio may change significantly over a short space of time. This is not a buy, sell or hold recommendation for any particular security.

8 Confidential | Investec Asset Management Avoiding value traps What are we not attracted to?

Most of the stock ideas fail one or more of our pre-screening tests which we’ve implemented to avoid value traps

Balance sheet ● Too much debt? ● Hidden liabilities? ● Thinly capitalised financial?

Structural Valuation ● Terminal decline? ● Optical cheapness not enough given ● Risk of obsolescence? Pre-screening the business / industry? ● Value-destructive industry? ● Discount to book for financials tests justified by unappealing returns?

Governance Circle of competence ● Arm of the state? ● Too hard? ● Controlled by a majority shareholder ● Too complicated? with minority shareholder rights and ● Past experience in the sector returns a low priority? suggests avoiding?

9 Confidential | Investec Asset Management After pre-selection Full due diligence lasts between 3 and 6 weeks. Template is flexible but there are certain questions that need to be answered

The price Capital structure ● Is valuation low in absolute terms? ● Is it safe through the cycle? ● We prefer EV/EBIT to take account of capital structure ● Does it give the company time to sort out its current issues?

Objective: The business 1. Is the business cheap in Cash flows ● Can we understand the industry and the relation to its fundamental ● Do they confirm accounting profits? company’s position in it? characteristics? ● How capital-intensive is the business? ● What are its future prospects? 2. What is the likelihood that it will recover? 3. What happens to our investment if we are wrong?

Corporate governance Returns ● Have management been good stewards of the business and ● Does the company add value over time? shareholder funds (can we “trust” them?) ● What is a normal rate of return on capital and why should it continue to ● Do they have a sustainable, long-term strategy? be so?

10 Confidential | Investec Asset Management Theme - Valuation dispersion is high across equity markets Increasing bifurcation between high and low PE stocks

FTSE 350 ex Investment Trusts (Trailing PE)

Source: Exane BNP Paribas, December 2017. For further information on indices please see Important Information section.

12 Confidential | Investec Asset Management Update: Monthly

The opportunity set UK

80 Number of securities

30 Dec 04 Dec 05 Dec 06 Dec 07 Dec 08 Dec 09 Dec 10 Dec 11 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17

Stocks which have fallen -50% relative to the FTSE All-Share Index over 5 years, excluding the last 2 years

Source: FactSet, 28 February 2018. For further information on indices, please see the Important information section.

13 Confidential | Investec Asset Management Update: Monthly

The opportunity set UK Consumer Consumer Telecommunication Materials Energy Discretionary Industrials Staples Utilities Real Estate Financials Services Health Care TalkTalk Telecom Hikma Acacia Mining Tullow Oil AA Capita Tesco Drax Group Intu Properties Provident Financial Group Pharmaceuticals Greencore Group Vedanta Resources Petrofac Limited Dignity Serco Group Centrica RDI REIT IP Group Inmarsat Vectura Group Plc Capital & Counties Hochschild Mining Cairn Energy N Brow n Group FirstGroup J Sainsbury Standard Chartered BT Group Shire Properties

Fresnillo Hunting Dixons Carphone Aggreko Saga

Sports Direct Royal Bank of Essentra Stagecoach Group International Scotland Group

Anglo American McCarthy & Stone MITIE Group Man Group

KAZ Minerals Pearson Cobham Just Group

Antofagasta Mitchells & Butlers Galliford Try

Polymetal Babcock Greene King International International Group

BHP Billiton Card Factory Go-Ahead Group

Marks and Spencer Group

Dunelm Group

Pets At Home Group

ITV Stocks which have fallen -50% relative to the FTSE All-Share Index over 5 years, excluding the last 2 years No representation is being made that any investment will or is likely to achieve profits or losses similar to those achieved in the past, or that significant losses will be avoided. This is not a buy, sell or hold recommendation for any particular security. Source: FactSet, 28 February 2018. For further information on indices, please see the Important information section.

14 Confidential | Investec Asset Management Update: Monthly

Transaction activity Recent Transactions (6 months)

Buys Capita Imperial Brands Additions Centrica Forterra Lloyds Banking Travis Perkins Reductions Citigroup Computacenter Grafton Sells International Personal Finance 5.75% 2021 Ladbrokes Coral Standard Chartered Yara International

The portfolio may change significantly over a short space of time. This is not a buy, sell or hold recommendation for any particular security. Source: Factset, Investec Asset Management, 28 February 2018.

15 Confidential | Investec Asset Management Theme – Valuation dispersion is high across equity markets

ACTION ● The portfolio has a distinct bias to cheap stocks which have underperformed (financials and consumer related sectors)

16 Confidential | Investec Asset Management Theme - banks offer a favourable risk/return trade-off Improving fundamentals for Banks

● We are past the peak in fines and regulation

● Profitability remains strong in a fairly oligopolistic market

● Balance sheets are strong and stress-tested

● Dividends are growing

● Valuations remain modest

18 Confidential | Investec Asset Management Update: Monthly

Valuations are modest

Stock Price/tangible book Barclays 0.8x

Citigroup 1.2x

HSBC Holdings 1.2x

Lloyds Banking 1.3x

Royal Bank of Scotland 0.7x

This is not a buy, sell or hold recommendation for any particular security. The portfolio may change significantly over a short period of time. Source: Bloomberg, Investec Asset Management, 28 February 2018. Bank stocks held by Investec UK Special Situations Fund.

19 Confidential | Investec Asset Management Update: Monthly

Theme - banks offer a favourable risk/return trade-off

Stock Portfolio weight (%) ACTION HSBC 7.1 ● The sector is the largest Barclays 4.9 overweight on the portfolio: Royal Bank of Scotland 3.3 Lloyds Banking 3.4 Citigroup 2.1 TOTAL 20.7

FTSE Banks Supersector 11.6

20 Confidential | Investec Asset Management Theme: the market for repair, maintenance and improvement remains depressed Real UK RMI spend has lagged European peers and is close to a 25-year low

RMI spend per capita

Source: Berenberg estimates, Euroconstruct, Datastream, December 2016.

22 Confidential | Investec Asset Management Current RMI spend depressed as housing transactions remain low relative to historical average

RMI spend per house p.a. (£, 2011 prices) Age of housing stock (years)

Housing transactions as % of UK housing stock Planning permissions for householder developments, rolling annual (000s)

Source: Liberum, 16 January 2018

23 Confidential | Investec Asset Management Some structural positives

● The market remains ● The sector is far less ● With house moving costs fragmented – smaller vulnerable to disruption than high, more house owners may merchants will slowly be most others be encouraged to extend their consolidated and this should current houses generate improved returns

● Government policy is currently anti-landlord. A ● And rules for planning permission have been change in the mix of households from rented to relaxed in recent years owned should be supportive to growth in RMI

24 Confidential | Investec Asset Management Update: Monthly

Theme - the market for repair, maintenance and improvement remains depressed

ACTION

● The portfolio is significantly exposed to this theme:

Stock TBIT weight (%) Grafton 4.0 SIG 3.0 Travis Perkins 2.8 TOTAL 9.8

25 Confidential | Investec Asset Management Theme – Idiosyncratic exposure to UK consumer Update: Monthly

Theme - exposure to UK consumer

ACTION

● Portfolio has significant exposure to this theme

Stock TBIT weight (%) Marks & Spencer 1.9 easyJet 1.8 Next 1.4 Kingfisher 1.2 Go-Ahead 1.0 N Brown 0.5 Countrywide 0.1 TOTAL 8.0

The portfolio may change significantly over a short period of time. This is not a buy or sell recommendation for any particular security. Source: Investec Asset Management, 28 February 2018.

27 Confidential | Investec Asset Management Theme - China’s private sector debt growth is at frightening levels China – the biggest bubble of all?

Credit bubbles by country then and now. The lesson from history: credit bubble always burst Household + corporate debt as % of GDP

Crescat capital, 5 August 2017.

29 Confidential | Investec Asset Management Theme - government debt keeps building and inflation is picking up Let the unwind begin…

Combined balance sheet totals Fed + ECB + BoE + SNB + BoJ in USD (bn) 18,000

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

- 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Source: Bloomberg, 28 February 2018.

31 Confidential | Investec Asset Management High levels of government debt have historically led to defaults and inflation Why should this time be any different?

50 Countries in default or restructuring Total public debt/GDP, world average 90 Once this happens Countries with annual inflation over 20% 45 (top arrow), 200+ years of history 40 80 tells you what comes next: 35 70 Sovereign 30 restructuring &/or default followed by 60 25 currency devaluation –

50 induced inflation Percentage (%) Percentage Percentage (%) Percentage 20 (CDII) (Bottom 15 arrow) 40 We’ve been living 10 on borrowed time 30 since 2008…Rogoff 5 MUST know this.

0 20 1826 1836 1846 1856 1866 1876 1886 1896 1906 1916 1926 1936 1946 1956 1966 1976 1986 1996 2006

Source: Forrest for the Trees, 2011. Please note that this chart has been redrawn by Investec Asset Management for stylistic purposes using the original version as a template.

32 Confidential | Investec Asset Management Rates are close to the lowest in 5000 years Investors believe inflation will remain low but central bankers are keen to reflate

BofA Merrill Lynch Global Investment Strategy. March 2017.

33 Confidential | Investec Asset Management Update: Monthly

Theme - the authorities are struggling to generate much growth…and the debt keeps building

ACTION

● The portfolio is exposed to precious metals through physical holdings in gold and silver, and also gold and silver shares

Security Portfolio weight (%) ETFS Physical Silver 1.9 Global X Silver Miners ETF 1.4 Gold Bullion Securities 0.9 VanEck Vectors Gold Miners ETF 0.5 Hochschild Mining 0.1 TOTAL 4.7

The portfolio may change significantly over a short period of time. This is not a buy or sell recommendation for any particular stock. Source: Investec Asset Management, 28 February 2018.

34 Confidential | Investec Asset Management Portfolio performance and positioning Update: Monthly

Temple Bar Investment Trust Top ten holdings

Security Portfolio weighting (%) HSBC Holdings 7.1 Royal Dutch Shell 5.8 GlaxoSmithKline 5.4 Barclays 4.9 BP 4.7 Grafton 4.0 Lloyds Banking 3.4 Royal Bank of Scotland 3.3 SIG 3.0 Capita 2.8

The portfolio may change significantly over a short period of time. This is not a buy or sell recommendation for any particular stock. Source: Investec Asset Management, preliminary data to 28 February 2018.

36 Confidential | Investec Asset Management Update: Monthly

Temple Bar Asset Allocation

% weight UK Equities 75.1 Of which: FTSE 100 46.5 FTSE 250 25.6 FTSE Small Cap 3.0 Internationally listed stocks 6.7 Physical Gold & Silver 4.6 Cash & Equivalents 13.1 Fixed Interest 0.5

● Portfolio concentration: – Top 10 = 44.4% – Top 20 = 65.1% – Top 30 = 77.6%

The portfolio may change significantly over a short period of time. Source: Investec Asset Management, 28 February 2018. For further information on indices, please see the Important information section.

37 Confidential | Investec Asset Management Update: Monthly

Sector positions

Absolute positions Relative positions

Retail Retail Banks Banks Industrial Goods & Services Industrial Goods & Services Physical Gold & Silver Physical Gold & Silver Construction & Materials Construction & Materials Utilities Utilities Real Estate TBIT weights Real Estate Technology FTSE All-Share weights Technology Automobiles & Parts Automobiles & Parts Chemicals Chemicals Travel & Leisure Travel & Leisure Oil & Gas Oil & Gas Telecommunications Telecommunications Health Care Health Care Media Media Food & Beverage Food & Beverage Insurance Insurance Basic Resources Basic Resources Financial Services Financial Services Personal & Household Goods Personal & Household Goods

0 5 10 15 20 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 % weight % weight

The portfolio may change significantly over a short period of time. Source: Investec Asset Management, FactSet, 28 February 2018. For further information on indices, please see the Important information section.

38 Confidential | Investec Asset Management Update: Monthly

Active positions

Top 10 overweight positions Top 10 underweight positions Fund Index* Active Fund Index* Active Security (%) (%) (%) Security (%) (%) (%) Grafton 4.0 0.1 3.9 British American Tobacco 0.0 4.2 -4.2 Barclays 4.9 1.6 3.3 Diageo 0.0 2.6 -2.6 SIG 3.0 0.0 3.0 AstraZeneca 0.0 2.6 -2.6 Royal Bank of Scotland 3.3 0.4 2.9 Royal Dutch Shell 5.8 8.2 -2.4 GlaxoSmithKline 5.4 2.7 2.7 Vodafone 0.0 2.3 -2.3 Capita 2.8 0.0 2.7 Prudential 0.0 2.0 -2.0 Travis Perkins 2.8 0.1 2.6 Rio Tinto 0.0 2.0 -2.0 Wm Morrison Supermarkets 2.6 0.2 2.4 Glencore 0.0 1.9 -1.9 Citigroup . 2.1 0.0 2.1 Unilever 0.0 1.8 -1.8 Tesco 2.7 0.7 1.9 Reckitt Benckiser 0.0 1.5 -1.5

The portfolio may change significantly over a short period of time. This is not a buy, sell or hold recommendation for any particular security. Source: Investec Asset Management, 28 February 2018. • Index is FTSE All Share. For further information on indices, please see the Important information section.

39 Confidential | Investec Asset Management Summary

● A decade after the financial crisis, the growing global debt mountain remains a significant problem

● The conventional policy tools have been fully used. We believe further unconventional tools will be used in the future

● And if we are worrying about nothing, bonds are significantly over-valued

● And a rise in bond yields would make it hard for equities to gain further ground…

● …although interesting opportunities do exist for contrarians

40 Confidential | Investec Asset Management Appendix Calendar year performance

30.0%

24.1% 25.0% 22.8% 21.2% 20.0%

15.0% 13.3%

10.0% 5.6% 4.5% 4.4% 5.0% 1.4% 0.0%

-5.0%

-7.3% -10.0% -8.4%

-15.0% Feb 13 - Feb 14 Feb 14 - Feb 15 Feb 15 - Feb 16 Feb 16 - Feb 17 Feb 17 - Feb 18

Temple Bar NAV FTSE All-Share TR GBP

Past performance figures are not audited and should not be taken as a guide to the future. Source: Morningstar, in GBP, 28 February 2018, using cum income NAV, debt at market value.

42 Confidential | Investec Asset Management Update: Monthly

Temple Bar Investment Trust Largest stock position changes

12 month period as at 28 February 2018

Capita plc 2.78

Next plc 1.45

Global X Silver Miners ETF 1.42

Kingfisher Plc 1.18

Forterra Plc 1.12

GlaxoSmithKline plc -1.45

J Sainsbury plc -1.51

Yara International ASA -1.70

Best Buy Co., Inc. -1.90

British American Tobacco p.l.c. -2.01

-3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 Change in position (%)

Source: Investec Asset Management, FactSet, 28 February 2018.

43 Confidential | Investec Asset Management Update: Monthly

Temple Bar Investment Trust Largest sector position changes

12 month period as at 28 February 2018

Industrial Goods & Services 2.53

Construction & Materials 0.91

Oil & Gas 0.53

Real Estate 0.35

Insurance 0.02

Basic Resources -0.52

Utilities -0.64

Health Care -1.45

Chemicals -1.70

Personal & Household Goods -1.93

-5 -4 -3 -2 -1 1 2 3 4 Change in position (%)

Source: Investec Asset Management, FactSet, 28 February 2018.

44 Confidential | Investec Asset Management Thank you

www.investecassetmanagement.com Contact details

Investec Asset Management Woolgate Exchange Telephone: +44 (0)20 7597 1900 25 Basinghall Street Email: [email protected] London EC2V 5HA United Kingdom

www.investecassetmanagement.com

Outside the US, telephone calls may be recorded for training and quality assurance purposes. Issued by Investec Asset Management, March 2018.

46 Confidential | Investec Asset Management Important information

This presentation has been issued on behalf of the Board of the Trust and has been approved by Investec Asset Management Limited and its Manager. Investec Asset Management is authorised and regulated by the Financial Conduct Authority. THIS DOCUMENT IS PROVIDED FOR GENERAL INFORMATION ONLY. IT IS NOT AN INVITATION TO MAKE AN INVESTMENT NOR DOES IT CONSTITUTE AN OFFER FOR SALE. All the information contained in this document is believed to be reliable but may be inaccurate or incomplete. Any opinions stated are honestly held but are not guaranteed and should not be relied upon. The portfolio may change significantly over a short period of time. This is not a buy or sell recommendation for any particular stock. Past performance should not be taken as a guide to the future and there is no guarantee that this investment will make profits. The value of this investment, and any income generated from it, will be affected by market and currency movements and by other political, social and economic developments, as well as by fee levels and taxes and other specific matters relating to the assets in which it invests. Investors are not certain to make profits; losses may be made. Where charges are deducted from capital, the potential for capital growth will be reduced (60% of the management fee and interest payable are charged to capital). The effect of borrowings to finance the Trust’s investments is to magnify the volatility of its price and potential capital gains and losses. Please note that Investec provides Temple Bar with investment management services. Investec may have a position in Temple Bar. Phone calls may be recorded for training purposes and quality assurance purposes. For further details, call the Investor Services Department on

020 7597 1800, or send an email to [email protected]. Alternatively, visit our Internet site: www.investecassetmanagement.com Temple Temple Bar

47 Confidential | Investec Asset Management Investec Asset Management

Australia Europe (ex UK) Singapore United Kingdom Level 23, The Chifley Tower Woolgate Exchange 25 Duxton Hill #03-1 Woolgate Exchange 2 Chifley Square 25 Basinghall Street Singapore 25 Basinghall Street Sydney, NSW 2000 London, EC2V 5HA 089608 London EC2V 5HA Telephone: +61 2 9293 6257 Telephone: +44 (0)20 7597 1890 Telephone: +65 (0)6653 5550 Telephone: +44 (0)20 7597 1900 Facsimile: +61 2 9293 2429 Facsimile: +44 (0)20 7597 1919 Facsimile: +65 (0)6653 5551 Facsimile: +44 (0)20 7597 1919

Botswana Hong Kong South Africa United States Plot 64511, Unit 5 Suites 2602-06, Tower 2 Cape Town 666 5th Avenue Fairgrounds The Gateway, Harbour City 36 Hans Strijdom Avenue 37th Floor Gaborone Tsim Sha Tsui, Kowloon Foreshore New York, NY 10103 Hong Kong Cape Town, 8001 Telephone: +267 318 0112 Telephone: +852 2861 6888 Telephone: +27 (0)21 416 2000 US Toll Free: +1 800 434 5623 Facsimile: +267 318 0114 Facsimile: +852 2861 6861 Facsimile: +27 (0)21 416 2001 Telephone: +1 917 206 5179 Facsimile: +1 917 206 5155

Channel Islands Namibia Johannesburg PO Box 250, 100 Robert Mugabe Avenue, Office 100 Grayston Drive St. Peter Port 1 Ground Floor, Heritage Square Sandown Guernsey, GY1 3QH Building, Windhoek Sandton, 2196 Telephone: +44 (0)1481 710 404 Telephone: +264 (61) 389 500 Telephone: +27 (0)11 286 7000 Facsimile: +44 (0)1481 712 065 Facsimile: +264 (61) 249 689 Facsimile: +27 (0)11 286 7777

www.investecassetmanagement.com

Please note that this communication is not necessarily approved for distribution in all of the above jurisdictions

48 Confidential | Investec Asset Management