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WITAN INVESTMENT TRUST PLC

This announcement contains regulated information

Annual Financial Report for the year ended 31 December 2017

Chairman's Report

Highlights

· NAV total return of 19.0%, outperforming the benchmark's return of 15.1% by 3.9%

· 5 year NAV total return of 115%, 28% ahead of the benchmark

· Share price discount to NAV reduced to 1.6% at year-end (2016: 4.0%)

· £30m of long-term debt issued at a fixed rate of 2.74%

· 2.8m shares bought back, helping to narrow the discount to 1.6%

· Dividend increased by 10.5% to 21.0p, more than double the level in 2007 and the 43rd consecutive annual rise

Summary

Witan has been operating a multi-manager approach since 2004. Over this period we have beaten the returns on our equity benchmark and raised the dividend significantly faster than the rate of inflation. We will strive to extend this record.

Global economic growth strengthened and became more broadly based during 2017 and corporate earnings followed suit. In the UK the Brexit negotiations and political uncertainties affected corporate confidence but in Europe political developments were generally helpful to sentiment. Steady growth in the US allowed the Federal Reserve to continue gradually raising interest rates and to begin reducing its bond holdings, accumulated during the quantitative easing period.

With inflation subdued, interest rates low and corporate earnings rising, the backdrop for equity markets was generally positive. Our investment portfolio benefited from this environment, outperforming the benchmark. The net asset value (NAV) total return was 19.0%, 3.9% ahead of our benchmark's total return of 15.1 %. The share price total return, enhanced by a narrower discount, was 22.1 %.

A fourth interim dividend of 6.75 pence was declared in February 2018, payable on 29 March 2018. As a result, the dividend for the year increased by 10.5% to 21.0 pence per share (2016: 19.0 pence), fully covered by revenue earnings, with £5.5m added to the Company's revenue reserves. This is the 43rd consecutive year of rising dividends at Witan, with the dividend more than double that paid in 2007.

Taking a longer perspective, over the past 5 years Witan has achieved a NAV total return of 115%, compared with the benchmark's 87% return over this period. During the 10 years to the end of 2017, shareholders have had a NAV total return of 155%, compared with the benchmark's return of 114%.

Witan's shares in the market

During 2017, the Company bought back a total of 2.8m shares at discounts between 6% and 1.5%, adding £0.9m to the net asset value for remaining shareholders and contributing to a reduction in the discount from 4% at the end of 2016 to 1.6% at the end of 2017.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Chairman's Report continued

It remains a long-term objective to create sustainable liquidity in Witan's shares at or near to net asset value.

Issue of long-term debt

The Company issued £30m of long-term (37 year) debt at a fixed rate of 2.74%, which is the lowest long-term borrowing rate secured by an investment trust for many years and well below the historical average level of interest rates. The Board believes that borrowing at such a low rate will benefit shareholder returns. This issue, together with the low cost debt issued in 2015, has reduced the average interest rate on the Company's fixed-rate borrowings from 7% in 2014 to 4.3% as at the end of 2017.

Board changes

Robert Boyle will be standing down at the AGM, after serving on the Board since 2007 and as Chairman of the Audit Committee since 2008. Catherine Claydon will also be standing down having served on the Board and as Chairman of the Remuneration and Nomination Committee since 2009. On behalf of shareholders, I thank them both warmly for their valued service on behalf of Witan's shareholders.

Jack Perry, who joined the Board in January 2017, will take over as Chairman of the Audit Committee, following the AGM, while Richard Oldfield will succeed Catherine as Remuneration and Nomination Committee Chairman.

AGM

Our Annual General Meeting will be held at Merchant Taylors' Hall on Wednesday 2 May 2018 at 2.30 pm. Formal notice of the meeting will be sent to shareholders when the Annual Report is published. We look forward to the opportunity to meet you then for the Company's 110th AGM.

Harry Henderson

Chairman

12 March 2018

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Chief Executive's Report

The investment markets in 2017

Equity markets performed well during 2017, with global equities up 13.8% in sterling terms. After lagging significantly during 2016, UK equities (+13.1%) kept pace with overseas markets, despite the vicissitudes of the Brexit negotiations. Overseas market returns of over 20% in many regions were partly offset as the pound reversed some of its 2016 losses but in sterling terms most regions still delivered strong absolute returns, with a better performance by non-US markets, after a long period of US leadership. The strongest regions were Europe (+16.9%) and Asia (+19.5%), while North America returned 11.3%.

Witan's multi-manager approach is to select a range of external managers who have demonstrated the potential to outperform, to create a portfolio targeting both capital and income growth. 2017 was a good year for active management and our external managers as a whole beat their benchmarks. The net asset value total return outperformance was principally driven by this, along with the decision to maintain 10% gearing for most of the year. Notable performances were achieved by Lindsell Train (+21.8%), Lansdowne (+19.1%) and Veritas (+17.1%). These, together with the Direct Holdings portfolio (+27.2%) all materially outperformed their benchmarks.

Portfolio changes

One measure of the portfolio's potential to benefit from the managers' stock picking decisions is the "active share" which describes the proportion of the portfolio which differs from the benchmark (see page 7). This rose from 70% to 77% during 2017. Exposure to emerging markets was raised in February with the appointment of GQG. In May, the five global managers were consolidated into three and in October two managers with concentrated portfolios were appointed to increase European exposure. The Strategic Report on pages 5 to 21 sets out details of the third party managers' performance during the year as well as decisions made in the areas of gearing, the use of index futures, changes in external managers and the portfolio of directly held collective investments.

Outlook

During 2017, some central banks began to raise interest rates or to reduce (and, in the US, start to reverse) the monetary stimulus stemming from their purchases of financial assets (quantitative easing). Inflation remained low and less responsive than expected to rising economic activity, enabling monetary tightening to take place very gradually - more a case of taking the foot off the accelerator than applying the brakes.

2018 seems set to be another year of broadly-based, steady but not especially rapid, global economic growth. Whilst this should be supportive of growth in profits, bond and equity markets may be vulnerable if currently benign inflation assumptions are disappointed. There are several potential risks.

The enactment of a significant programme of tax cuts in the US at the end of 2017 will potentially boost growth at a time when there is limited spare capacity in the US economy. The success of oil producers in restraining output has pushed oil prices up which, unless the move is reversed, will increase energy costs for oil users. Increased cost pressures may reduce corporate profits, given the widespread lack of pricing power as a result of globalisation and the disruptive effect of technological change. Central banks might react to higher than expected inflation with faster than expected rate rises.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Chief Executive's Report continued

A further factor is that reducing central bank bond purchases will progressively weigh on the balance between supply and demand in government bond markets which, other things being equal, will exert upward pressure on yields.

These developments will be monitored carefully. Although moderate rises in inflation, interest rates and bond yields can coincide with healthy economic growth and rising equity markets, watchfulness is called for given the degree of investor optimism reflected in equity valuations. The volatile market conditions that appeared in early February were a reminder of the need for optimism on growth to be tempered by realism on valuations amid bond-market nervousness concerning possible inflation risks.

On the home front, the underperformance by domestically-exposed UK equities suggests lingering concerns, as a result of 2016's Brexit referendum and the policy uncertainty engendered by 2017's General Election. The Board and its managers will continue to take account of the implications of these issues, amongst others, in managing Witan's globally diversified portfolio.

The improvement in economic growth should allow corporate profits to catch up with the expectation built into equity valuations. Assuming that rises in bond yields are moderate, equity ratings continue to look competitive with the returns offered from bonds and cash. Equity ratings are high by historic standards, but interest rates are extraordinarily low. The changes made over the past year increase the stock specific focus of the portfolio, at a time when index valuations offer few windfalls.

Andrew Bell

Chief Executive

12 March 2018

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report

Strategy and business model

This Strategic Report is intended to help shareholders assess the Company's strategy. It contains certain forward-looking statements. These are made by the directors in good faith based on the information available to them up to the time of their approval of this report. Such statements should be treated with caution due to the inherent uncertainties including economic and business risks, underlying any such forward-looking information.

This report falls into three main sections:

1. Performance and principal developments in 2017 (page 5)

2. Strategy and business model (page 13)

3. Corporate and operational structure (page 16).

Witan is an Investment Trust, founded in 1909 and listed on the London Stock Exchange since 1924. It is managed by the Executive team of its subsidiary Witan Investment Services Limited (WIS), as Alternative Investment Fund Manager (AIFM), under the control and supervision of the Company's Board of directors.

Special note: The European Union's Packaged Retail Investment and Insurance based Products ('PRIIP's) Regulations cover Investment Trusts and require Boards to prepare a Key Information Document ('KID') in respect of their Companies. Witan's KID is available on the Company's website. Investors should note that the processes for calculating the risks, costs and potential returns in the KID are prescribed by EU law and the Company has no discretion over the format or content of the document. The illustrated performance returns in the KID cannot be guaranteed and, together with the prescribed cost calculation and risk categorisation, may not reflect figures for the Company derived using other methods. Accordingly the Board recommends that investors also take account of information from other sources, including the Annual Report.

1. Performance and principal developments in 2017

Performance summary and attribution

Witan's NAV total return (with debt at fair value and after all costs) was 19.0%, 3.9% ahead of the 15.1% return from the Company's equity benchmark. Taking the par value of debt, the NAV total return was 18.8%, 3.7% ahead of the benchmark. The shareholder total return was 22.1%, as the discount narrowed to 1.6% (2016: 4.0%). Five out of the seven third party managers in place for the full year outperformed their benchmarks. The Direct Holdings portfolio also significantly outperformed Witan's benchmark. Significant value was added by Witan's use of gearing, which averaged 10.5% during the year. The gross contribution from gearing of 2.2% was 1.7% after taking account of the Company's borrowing costs. Share buybacks contributed 0.05% (£0.9m) to NAV returns. Further details of the portfolio's performance attribution are shown in the table on page 6.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Net asset value total return	+19.0%	Portfolio total return (gross)		+18.2%
Benchmark total return	+15.1%	Benchmark total return		+15.1%
		Relative investment performance		+3.2%
		Gearing impact	+2.2%
		Effect of changed fair value of debt	+0.0%
		Share buybacks	+0.1%
				+2.2%
				+5.4%
		Borrowing costs	-0.5%
		Operating costs and tax	-1.1%
				-1.6%
Relative performance	+3.9%			+3.9%

N.B. Figures may not sum, due to rounding

Key Performance Indicators

The financial statements in the Annual Report set out the required statutory reporting measures of the Company's financial performance. Success is monitored against Key Performance Indicators ('KPIs') viewed as significant measures of longer-term success. Given the inherent volatility of investment returns, success over the long term is viewed as most important, although performance is also monitored over shorter periods.

Aside from the statutory accounting measures, the principal financial KPIs are set out below, with a report of Witan's performance during the year. With respect to non-financial measures, details of the Company's policies and compliance in relation to the UK Corporate Governance Code are set out in the Corporate Governance Statement in the Annual Report.

A. Investment performance

· Positive long-term real returns and outperformance of Witan's equity benchmark.

The Company seeks at least 2% p.a. long-term outperformance in NAV total return and shareholder total return.

In 2017, Witan achieved a NAV total return of 19.0%, 3.9% ahead of its benchmark (see page 14), with a shareholder total return of 22.1% benefiting from a narrowing of the discount. Witan's total returns were also well ahead of inflation of 3% for the year to December 2017. Returns over the longer term, set out on page 23, indicate that the return objectives have also been met over the past 3 and 5 year periods.

· Long-term outperformance by the individual managers relative to their benchmarks.

In 2017, five of the seven third party managers in place for the full year and the internally-managed Direct Holdings portfolio outperformed their benchmarks. The returns since each manager's appointment are set out in the table on page 8. Further details are set out on page 8.

B. Annual growth in the dividend per share ahead of inflation

The dividend was increased by 10.5%, 7.5% ahead of the inflation rate of 3% in the year to December 2017. Further details are set out on page 9.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

C. A positive contribution to investment returns from the use of borrowings

The Company employed average gearing of 10.5% during the year, which contributed 2.2% to gross returns. After allowing for the payment of interest, there was a net contribution of 1.7%. Further details are set out on page 10.

D. A share price trading at a sustainable low discount (or a premium) to NAV (including income, with debt at fair value), taking account of prevailing investment conditions

The shares traded at an average discount of 2.8% in 2017, compared with an average 5.8% discount in 2016. The discount at the year-end was 1.6% (2016: 4.0%). Further details are set out on page 11.

E. A competitive level of ongoing charges, balancing the need to pay for high quality investment management with keeping the costs of managing the business as low as possible.

In 2017, the ongoing charges figure ('OCF') was 0.76% excluding performance fees (2016: 0.75%) and 0.78 % including performance fees (2016: 0.65%). Further details are set out on pages 11 and 12.

Combined portfolio composition

The sector and regional structure are summarised below. The top 50 holdings are set out in the Annual Report. They represented 46% of Witan's portfolio at 31 December 2017 (2016: 44%). These analyses highlight the portfolio's substantial diversification.

The portfolio's active share

Achieving outperformance requires the portfolio to differ from the benchmark. It is important that diversification does not suppress the benefits sought when selecting active managers. One measure of active management is known as "active share". A portfolio identical to the benchmark has an active share of 0% while one with no holdings in common with its benchmark has an active share of 100%. Although active share is an incomplete measure of active management (let alone likely success), the active share of our combined portfolio was circa 77% at the end of 2017 (2016: 70%). This indicates that Witan's portfolio differs markedly from the relevant indices, while remaining well-diversified across global regions, industry sectors and at the individual company level.

Geographical distribution at 31 December 2017

	%
UK	35
North America	22
Europe	21
Far East	14
Japan	5
Other	3

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Sector breakdown of the portfolio

	%
Financials including investment companies	29.4
Consumer Services	15.5
Industrials	14.7
Technology	11.8
Consumer Goods	10.2
Health Care	6.0
Other	8.4
Open-Ended Funds	0.7
Equity Index Futures	1.1
Cash/Bonds	2.2

Investment managers' performance

Investment manager	Value of Witan assets managed at 31.12.17 £m	% of Witan's assets under management at 31.12.17 (Note 1)	Performance in 2017 (%)	Benchmark performance in 2017 (%)	Performance since appointment (%) (Note 2)	Benchmark performance since appointment (%)
Artemis	184.8	8.3	7.7	13.1	10.1	6.8
Heronbridge	138.1	6.2	12.0	13.1	11.2	9.0
Lindsell Train	175.6	7.9	21.8	13.1	16.8	10.1
Lansdowne Partners	330.6	14.9	19.1	11.6	22.7	16.1
Pzena	315.3	14.2	14.0	13.8	13.8	14.3
Veritas	311.4	14.0	17.1	13.8	14.5	12.3
CRUX	98.7	4.4	n/a	n/a	0.7	(1.4)
S.W. Mitchell	99.5	4.5	n/a	n/a	(1.2)	(1.4)
Matthews	260.3	11.7	21.5	20.6	12.7	11.0
GQG	92.6	4.2	n/a	n/a	16.7	16.0
Witan Direct Holdings	203.3	9.1	27.2	15.1	12.9	10.0

Notes:

(1) Percentage of Witan's investments managed and cash balances held centrally by Witan.

(2) The percentages are annualised where the date of appointment was more than one year ago.

Manager structure and performance

The third party managers follow mandates set by the Company. The mandate, benchmark, investment style and the date of appointment for each manager are shown in the Annual Report.

In February, GQG Partners LLP was appointed to manage a portfolio of Emerging Market equities. In May, Witan's five global managers were consolidated into three, with the assets managed by MFS and Tweedy, Browne being allocated between the remaining three global managers. In October, the pan-European portfolio managed by Marathon was reallocated to two new Europe ex-UK managers, CRUX and S.W. Mitchell, as the opportunity was taken to increase portfolio concentration and European exposure. These moves were undertaken after careful analysis of the impact on overall portfolio returns and, in the case of new managers, extensive search processes.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Seven of the third party managers were in place throughout the year. Strong returns were delivered by Lindsell Train (+21.8%), Lansdowne (+19.1%) and Veritas (+17.1%), which significantly outperformed their benchmarks, and Matthews (+21.5%) which performed 1% ahead of the Asia-Pacific index. Artemis and Heronbridge both underperformed the UK market, for stock specific and Brexit-related reasons.

Directly held investments

Up to 12.5% of the portfolio (previously 10%) may be invested by the Executive team, with the objective of outperforming Witan's equity benchmark. Up to 10% (at the time of investment) may be invested in specialist collective funds. These investments may represent undervalued asset categories or funds viewed as longer-term generators of superior returns. Up to 2.5% may be allocated in smaller mandates to third party managers with strong potential to add value, which are more newly-established or in highly specialised investment areas.

The Direct Holdings portfolio delivered a return of 27.2%, compared with 15.1% for Witan's benchmark. Returns were driven by strong performances from the specialist life sciences company Syncona (+52%), Princess Private Equity (+35%) and Aberforth Geared Income Trust (+36%) which restructured in June, enabling Witan to exit at NAV.

This portfolio is actively managed, with no fixed allocation. More capital is invested when opportunities appear (subject to the limits noted above) and the allocation falls when sales occur and there is a shortage of attractive new ideas. After two very strong years of returns, we have moderately reduced the proportion of our assets in this area. The portfolio held 10.2% of assets at the start of the year and was 9.1% of the investment portfolio at the end of 2017.

The main investments, which are all collective funds, are in listed private equity, life sciences and specialist regional or sector funds.

Dividend performance in 2017

The Company's dividend policy (subject to circumstances) is that the annual rate of growth in dividends per share should be greater than inflation, as measure by the UK Consumer Price Index ('CPI').

Revenue earnings increased by 7.7% to 23.8 pence per share in 2017. This was driven by an increase in portfolio dividends and, for much of the year, favourable foreign exchange impacts on overseas currency dividends.

For 2017, the Board has declared a fourth interim dividend of 6.75 pence per share, to be paid to shareholders on 29 March 2018, making a total distribution for the year of 21.0 pence (2016: 19.0 pence). This represents an increase of 10.5%, 7.5% ahead of the 3% rate of CPI inflation in the year to December 2017. This is the 43rd consecutive year of Witan dividend increases.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

In addition to increasing the dividend, the Company has added £5.5m to its revenue reserves. At £60m after allowing for 2017's fourth interim payment, the reserves are equivalent to over one and a half times the annual dividend. These reserves enable the Company to maintain or grow its dividends in years when revenue from the portfolio is less buoyant, or falls. Since 2007, Witan's dividend per share has more than doubled, rising 112% compared with 26% for the CPI. A chart in the Annual Report shows the growth in Witan's dividend over the past 10 years.

The Company pays dividends quarterly. The first three payments for 2018 (in June, September and December) will, in the absence of unforeseen circumstances, be paid at a rate of 5.25 pence per share (2017: 4.75 pence), being one quarter of the full year payment for 2017. The fourth payment (in March 2019) will be a balancing amount, reflecting the difference between the three quarterly dividends already paid and the payment decided for the full year.

Gearing and the use of derivatives

The Policy on the use of gearing (leverage) and the use of derivatives is detailed in Section 2 of the Strategic Report on page 15.

Gearing activity during 2017

The Company issued £30m in Private Placement Notes in November, bearing interest at 2.74% and repayable in 2054.

The size of the Company's short-term facility was increased to £125m in February 2017. At the end of December, the drawn balance on this facility was £73m (2016: £71m).

Gearing was maintained at around 10-11% for most of the year, reflecting improved economic news and a positive view being taken of the opportunities within global equity markets. The calculation of gearing takes account of cash balances and the full nominal value of any derivatives held.

At the end of 2016, gross gearing (the total value of all investment positions, less cash) was 10.3%. This included £21m in Emerging Markets equity index futures, equivalent to 1.2% of net assets. Gearing excluding this was 9.1%. At the end of 2017, gross gearing (on the same basis) was 9.7%. This included £23m in European equity index futures, equivalent to 1.2% of net assets. Gearing excluding this was 8.5%. Further details of the accounting treatment for these positions are given in the Annual Report.

Derivatives activity during 2017

The holding in MSCI Emerging Markets futures at the end of 2016 was sold in the months following the appointment of an emerging markets manager in February.

In April, an investment was made in European equity index futures ahead of the French election, as European political risks appeared to be fading and the region's economy was enjoying an upswing. This position was added to over the summer, to increase exposure to the region while a search was undertaken for new active managers. The search resulted in two managers being appointed in October, following which the index futures position was reduced from 2.5% of assets to 1.2%. At the year-end an investment of £23m remained, equivalent to 1.2% of assets.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

The realised capital gain on index futures during the year was £7.6m, as shown in the cash flow statement on page 28.

Witan's shares in the market - liquidity and discounts

Witan is a member of the FTSE 250 index, with a market capitalisation of £1.9 bn. The Board places great importance on the encouragement of a liquid market in Witan's shares on the London Stock Exchange and on clear communications with shareholders and potential investors.

Although delivery of sound investment performance remains the principal focus, the Board has also always paid attention to discount-related issues and has, over many years, made significant use of share buybacks, purchasing shares when they have stood at an unduly wide discount. In addition to being accretive to NAV, this has the objective of reducing the discount.

The discount trend since the end of 2012 is illustrated in a chart in the Annual Report. The exceptional discount widening experienced during 2016 (affected by an institutional share sale and the aftermath of the Brexit vote) has been reversed during 2017. During 2017, Witan bought a total of 2.8m shares into treasury, 2m early in the year at an average discount of 4%, with the balance repurchased since April at an average discount of 1.9%. This has added a total of £0.9m to the net asset value for remaining shareholders.

Discounts are affected by many factors outside the Company's control but where it is in shareholders' interests, (taking account of market conditions) the Company is prepared to buy back shares at a discount to NAV or to issue shares at a premium. It remains a long-term objective to create sustainable liquidity in Witan's shares at or near to asset value. The actions taken during 2017 are evidence of this commitment.

Costs

Investment management fees

Each of the third party managers is entitled to a management fee, based on the assets under management. The agreements can be terminated on one to three months' notice. Two managers, in total managing 16% of Witan's portfolio, have performance related fees, which are subject to capping in any particular year. They have lower base fees than the managers without performance fees.

The base fee rates for managers in place at the end of 2017 ranged from 0.25% to 0.80% per annum. The weighted average base fee was 0.52% as at 31 December 2017 (2016: 0.49%).

As an illustration, if our external managers uniformly outperformed their benchmarks by 3% after base management fees, this would generate a total investment management fee rate of 0.58% (including a 0.52% base fee and a performance fee of 0.05%), 9% lower than the comparable estimate in 2016 (0.64%). The actual fees payable will vary according to the actual performance of managers with higher or lower fees.

Witan takes care to ensure the competitiveness of the fees it pays. A majority of the fee structures incorporate a "taper" whereby the average fee rate reduces as the portfolio grows.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

The Company's investment managers may use certain services which are paid for, or provided by, various brokers. They may place business, including transactions relating to the Company, with those brokers. Under the requirements of MiFID II broker-provided services (other than the execution of transactions) must either be minor non-monetary benefits or, for research received by investment managers and charged to the Company, separately accounted for.

Ongoing charges and costs

The Key Information Document on the Company's website contains a measure of costs calculated in accordance with EU PRIIPs regulations, which includes average figures over a period. In accordance with AIC guidance, Witan will continue to calculate the Ongoing Charges Figure ('OCF') for the Annual Report on a consistent basis with those published in previous years, to facilitate comparison. It is emphasised that the Company's investment performance is reported after all costs, whichever measure is used.

The main cost headings constituting the OCF are set out in the table below. As in previous years, the figure for transaction costs is also shown. The figure for borrowing costs is also included in the table, for easy reference.

Category of cost	2017 £m	2017 % of average net assets	2016 £m	2016 % of average net assets
Other expenses (excluding investment management expenses)	6.46	0.35	5.21	0.33
Less expenses relating to the subsidiary (those expenses not relating to the operation of the investment company).	(1.45)	(0.08)	(0.89)	(0.06)
Investment management base fees (note 4)	9.02	0.49	7.62	0.48
Ongoing Charges Figure (including investment management base fees)	14.03	0.76	11.94	0.75
Investment management performance fees (note 4)	0.53	0.02	(1.46)	(0.10)
Ongoing charges (including performance fees)	14.56	0.78	10.48	0.65
Portfolio transaction costs*	3.18	0.17	2.00	0.13
Interest costs	7.62	0.41	9.62	0.60
Costs including transaction costs and borrowing costs	25.35	1.37	22.10	1.38
Outperformance during the year (after all costs, debt at fair value)		+3.9%		-0.1%

Figures may not sum due to rounding

*including costs relating to manager changes

The OCF (the recurring operating and investment management costs, as a percentage of average net assets) was 0.76% in 2017 (2016: 0.75%). Including performance fees due to third party managers, the OCF was 0.78% in 2017 (2016: 0.65%). The weighted average OCF for the AIC Global sector was 0.65% and 0.67% including performance fees (source: Morningstar). Investment management costs rose by more than the average level of net assets, due to the appointment of an emerging market manager (replacing an index futures investment) and to manager changes during the year. Other expenses rose owing to increased staff, regulatory and overseas custody costs.

The Company exercises strict scrutiny and control over costs. The Board believes that the OCF during the year represents good value for money for shareholders, taking account of recent and longer-term performance.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Priorities for the year ahead

In 2018, the priorities for Witan include:

> Investment: Seek to build on the good returns achieved for shareholders in recent years. Make use of a range of active managers to deliver Witan's strategic objectives. Continue to deliver dividend growth ahead of inflation;

> Communication: Communicate Witan's distinct and active investment approach and achievements effectively to existing and potential shareholders;

> Regulatory change: Continue to operate robust risk and investment management processes, liaising closely with the Company's AIFM to ensure compliance with regulatory developments.

2. Strategy and business model

Objective and strategy

The Company's objective is to achieve a competitive return for shareholders by generating long-term capital growth, providing an income that rises faster than inflation and outperforming a representative equity benchmark.

The Company's strategy is to add value by investing primarily in listed individual companies across a broad spread of global equity markets, while communicating effectively with existing and potential shareholders. The Company seeks to construct a combined portfolio covering a broad range of markets and sectors, offering a distinctive way for individual as well as institutional investors to access the opportunities created by global economic growth.

The Company uses an active multi-manager approach, allocating funds to selected third party investment managers. The aim is to access the best available managers, including those not accessible on the same terms (or at all) to UK investors. Individual portfolios are actively managed by each investment manager, in accordance with its mandate, with overall asset allocation and risk being managed by the Executive team, within delegated limits set by the Board.

This approach, adopted in 2004, recognises that no manager is likely to excel in all market conditions and regions. Selecting managers to invest in their areas of greatest competence should improve returns, while reducing performance variability relative to using a single manager.

Witan's approach is to combine different investment approaches and geographical mandates, creating a portfolio which can profit from the managers' ability to outperform over time. The selection process seeks managers focusing on fundamental value drivers rather than short-term trends.

Business model

The Company has appointed its wholly-owned subsidiary Company, Witan Investment Services Limited ('WIS') as its AIFM under the Alternative Investment Fund Managers Directive ('AIFMD'). As such, WIS is responsible for operating the Company's portfolio and risk management processes. WIS delegates certain portfolio management responsibilities to third party portfolio managers. The Company outsources other corporate functions. The Company's activities are overseen by the Executive team, headed by the Chief Executive Officer (CEO), who is a director of the Company.

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WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Whilst the third party managers appointed are responsible for stock selection in their individual portfolios, the Company's Board and WIS are responsible for the overall delivery of performance to shareholders, through the following means:

> Setting the overall investment objective;

> Selecting competent managers, who are expected to outperform a relevant benchmark;

> Operating appropriate portfolio, corporate governance and risk management controls;

> Adjusting asset allocation according to opportunity;

> The judicious use of borrowings with the aim of adding to performance;

> Direct investment in specialist funds;

> Selective use of exchange-traded derivatives for efficient portfolio management; and

> Clear communication of Witan's objective and results to shareholders and potential investors.

The Board's and the Executive's role in investment management

The Board is responsible for setting the Company's investment strategy, policy and guidelines.

The selection of individual investments is largely delegated to third party managers, subject to investment limits reflecting the particular mandate. The managers are chosen by the Witan and WIS Boards after a selection process focused on their scope to add value as part of the overall portfolio.

The overwhelming majority of the portfolio is in segregated accounts, held in custody by the Company's depositary. The operations of the custodian and the safeguarding of the Company's assets are supervised by the depositary.

At the end of 2017, the Company had 10 third party investment managers, covering a range of investment remits. The proportion of Witan's assets managed by each and their performance during the year are set out on page 8.

The returns from the third party investment managers' portfolios are expected to be the principal driver of performance. Aside from its role in selecting and overseeing the managers, the Executive seeks to add to performance by adjusting the level of gearing, by the selective use of exchange-traded derivatives to alter the asset allocation and by the use of specialist funds to gain exposure to areas viewed as offering attractive returns. The Executive operates within delegated parameters that are periodically reviewed by the Board and its AIFM. In essence, the Company seeks to have sufficient levers to pull to take advantage of a wide range of investment opportunities.

Witan's benchmark

The Company's benchmark is used as a transparent reference point for comparing performance. It is a combination of global equity markets, giving access to a wide range of investment opportunities in the global economy, covering the investment universe from which most of the portfolio holdings are chosen.

The benchmark consists of 30% UK, 25% North America, 20% Europe ex-UK, 20% Asia Pacific and 5% Emerging Markets. The component weightings reflect the Board's belief that returns derive from the changing opportunities as economies evolve, more than market capitalisation.

Page 15 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

The portfolio is actively managed and not designed to track any combination of indices. Performance can be expected to vary, sometimes considerably, from benchmark returns, while aiming for long term outperformance.

Gearing policy

The purpose of using borrowings (or 'gearing/leverage') is to improve returns for shareholders, by achieving investment returns higher than the cost of borrowing. Attention is paid to using a level of gearing appropriate for market conditions (borrowing more when markets are attractively valued and less when returns are expected to be poorer). A blend of long-term and short-term borrowings is used, to balance the certainty of cost from locking in fixed rates for longer periods with the flexibility of short-term facilities which can be readily repaid.

Although the Company has the legal power under its Articles of Association to borrow up to 100% of the adjusted total of shareholders' funds (which is also the maximum level set by its AIFM), the Board's longstanding policy is not to allow gearing (as defined in the Annual Report) to rise to more than 20%, other than temporarily in exceptional circumstances. Over the past five years it has generally varied between 5% and 15%. Where appropriate the Company may hold a net cash position.

Structure of borrowings

The Company has fixed-rate borrowings, principally consisting of:

Secured Bonds 2025 6.025% £64m

Private Placement Notes 2035 3.29% £21m

Private Placement Notes 2045 3.47% £54m

Private Placement Notes 2054 2.74% £30m

The average interest rate paid on the Company's fixed rate borrowings is 4.3%. The Company also has a £125m one-year facility, providing additional flexibility over the level of gearing, as well as enabling the Company to borrow in currencies other than sterling, if deemed appropriate. Witan may either invest its borrowings fully, or neutralise their effect with cash balances according to its assessment of the markets. The Company's third party managers are not permitted to borrow within their portfolios but may hold cash.

Use of derivatives

Where financial instruments are available that help with efficient portfolio management their use will be considered. Witan's policy on the use of derivatives prioritises transparency, cost effectiveness and the minimisation of counterparty risk. In recent years, exchange-traded index futures have been the only instruments used. These give exposure to a market index, are readily tradable and depend upon the creditworthiness of the exchange, not an individual firm. The value of the investments (which are traded on official exchanges) is marked to market every day.

Page 16 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

The use of index futures enables Witan to adjust its investment exposure or asset allocation quickly and flexibly. In both cases changes can be made without interfering with the objective of our investment managers, to pick stocks that will grow in value and outperform their benchmarks over the long term. The operation of this investment area is the responsibility of the CEO, acting under guidelines set and supervised by the Board. The Company's third party managers are not permitted to use derivatives and may not gear their portfolios.

Marketing

Witan and its Board place great importance in effectively communicating the Company's strategy and operating results to existing and potential shareholders. The Board and Witan's Executive maintain regular contact with shareholders and the wider market's participants including private and professional investors, financial advisers and intermediaries. Clear communication of the Company's investment objective and its success in implementing its strategy helps investors to decide how Witan fits with their own investment objectives. Other things being equal, this should help the shares to trade at a narrow discount or a premium to NAV, from which all shareholders benefit.

Information on the Company, its strategy and portfolio is regularly made available via the website ( www.witan.com ), newsletters and videos. Important shareholder information such as the Annual Report, the Key Information Document and Investor Disclosure Document can be found there, as well as details of the Company's Wisdom and Jump savings scheme operated by the Company's subsidiary, Witan Investment Services Limited. Investors can also purchase shares on a wide range of other investment platforms listed in the Annual Report. Key contact information can be found in the Annual Report.

3. Corporate and operational structure

Witan is an Investment Trust with a Premium Listing on the London Stock Exchange. It has a single, wholly-owned subsidiary, Witan Investment Services Limited ('WIS') which acts as the Company's AIFM.

Operational management arrangements

In addition to the appointment of third party investment managers, Witan and WIS contract with third parties for other services, including:

> BNP Paribas Securities Services London Branch ('BNPSS') for depositary services, custody, investment accounting and administration;

> Frostrow Capital LLP for company secretarial services;

> DST Services Ltd. ('DST') as the savings plan administrator of Witan Wisdom and Jump Savings;

> The Company takes specialist advice on regulatory compliance issues and, as required, procures legal, investment consulting, financial and tax advice.

The service quality and value received from major service providers are reviewed regularly by the Board.

Page 17 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

The contracts governing the provision of all services are formulated with legal advice and stipulate clear objectives and guidelines for service required.

Premises and staffing

The Company has a lease on office premises at 14 Queen Anne's Gate, London SW1H 9AA, which is the Company's registered office. The current lease has a 5 year term, which commenced in October 2015.

The Company's policy towards its employees is to attract and retain staff with the particular skills and expertise required to manage the affairs of an investment trust company. Details of the Company's remuneration policies and required disclosures are set out in the Directors' Remuneration Report in the Annual Report. Employees and those who seek to work at Witan are treated equally regardless of sex, marital status, creed, colour, race or ethnic origin. The Company has seven direct employees, four men and three women. At the end of 2017, the Board consisted of eight non-executive directors (six men and two women) and the Chief Executive Officer, Andrew Bell, who is an employee. Given its outsourced model and small number of direct employees, the Group has no specific policies in respect of environmental or social and community affairs.

Witan Investment Services ('WIS')

Witan Investment Services Limited is authorised and regulated by the Financial Conduct Authority ('FCA'). It is authorised to act as Witan's AIFM, to provide investment savings accounts and marketing services and to give investment advice to professional investors.

WIS's principal activities are acting as Witan's AIFM, providing executive management services to the Boards of Witan and Witan Pacific Investment Trust plc ('Witan Pacific'), communicating information about the companies to the market and the provision of savings plans for investors to hold Witan and Witan Pacific shares.

WIS's operational objectives for 2018 are:

> to fulfil its responsibilities as Witan's AIFM;

> to provide suitable advice to the Boards of its corporate clients;

> to manage the Witan Wisdom and Jump Savings Plans;

> to reduce the net operating costs for Witan; and

> to seek appropriate business opportunities that can add value for shareholders.

In 2017, WIS had two principal sources of income. These were savings plan revenues and the fees (as AIFM or Executive Manager and for marketing services) paid by its corporate clients. The main costs incurred were fees to the savings schemes administrator (DST), staff costs and professional advice to ensure compliance with its regulatory and accounting obligations.

Principal risks and uncertainties

The directors have carried out a robust assessment of the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity. These risks, and the actions taken to mitigate them, are set out on pages 18 and 19. In addition, note 14 to the Financial Statements in the Annual Report sets out in more detail the nature of and management processes for the principal financial risks identified.

Page 18 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Risks are inherent in investment and corporate management. It is important to identify important risks and ways to control or avoid them. WIS has a Risk Committee in order to monitor compliance with its risk management and reporting obligations as Witan's AIFM.

The Company has a framework of the key risks, with policies and processes devised to manage those risks. Its detailed risk map is reviewed regularly by the Audit Committee and the WIS Risk Committee, which report on issues arising to their respective boards. The guiding principles remain watchfulness, proper analysis, prudence and a clear system of risk management.

Where appropriate, the Witan and WIS Boards meet jointly to cover matters of common interest. The WIS Board consists of seven non-executives and one executive director who are also directors of Witan, and one executive director who is a Company employee.

The Group's key risks fall broadly under the following categories:

Market and investment portfolio risks

Witan invests in global equity markets on behalf of its shareholders. Equity exposure is unlikely to drop below 80% of net assets, in normal conditions. A key risk of investing in Witan is a general fall in equity prices, which could be exacerbated by gearing. Other risks are the portfolio's exposure to country, currency, industrial sector and stock specific factors. There are also risks associated with the performance of its investment managers and changes in Witan's share price rating.

The Board seeks to manage these risks through:

> a broadly diversified equity benchmark;

> appropriate asset allocation decisions;

> selecting competent managers and regularly monitoring performance;

> attention to key economic and political events;

> active management of risk, whether to preserve capital or capitalise on opportunities;

> the application of relevant policies on gearing and liquidity; and

> share buybacks and issuance to respond to market supply and demand.

During the year Andrew Bell (the CEO) managed the overall business and the investment portfolio in accordance with limits, determined by the Board and its AIFM, on which the CEO reports at each Board meeting. The Board also regularly reviews investment strategy and performance, supported by comprehensive management information and analysis.

Operational

Many of the Group's financial systems are outsourced to third parties, principally BNP Paribas Securities Services ('BNPSS'). Disruption to their accounting, payment systems or custody records could prevent the accurate reporting and monitoring of the Company's financial position. BNPSS as the Company's depositary has a key responsibility for monitoring such issues on behalf of the Company. DST acts as the Administrator for the Witan Wisdom and Jump Savings Plans so the effectiveness of their systems and controls is also key. Details of the Board's monitoring and control processes are explained further in the Corporate Governance Statement in the Annual Report.

Page 19 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Corporate governance

The Board takes its regulatory responsibilities very seriously and compliance issues and potential regulatory changes are regularly reviewed by the Board and its AIFM.

Details of the Company's corporate governance policies are set out in the Corporate Governance Statement in the Annual Report. The Board conducts an annual assessment of the effectiveness of its governance processes. There is also a 3-yearly independent external review, the most recent of which was in late 2016. See the Annual Report for further details.

Operational and regulatory risks are regularly reviewed by Witan's Audit Committee and WIS's Risk Committee. WIS is subject to its own operating rules and regulations and is regulated by the FCA. The Company has established a modus operandi for the effective coordination of its responsibilities and those of WIS, as its AIFM.

Operationally the multi-manager structure is robust, as the investment managers, the custodian and the fund accountants keep their own records which are regularly reconciled. The depositary, AIFM and the Board provide additional checks and safeguards. Management monitors the activities of all third parties and reports any significant issues to the Board.

Accounting, legal and regulatory

The Company must comply with sections 1158-59 of the Corporation Tax Act 2010 ('CTA'). A breach could result in the Company losing investment trust status and, as a consequence, capital gains realised would be subject to Corporation Tax. The accounting criteria are monitored by the CEO and AIFM and the Company carefully monitors compliance with the applicable rules.

The Company must comply with the provisions of the Companies Act 2006 ('Companies Act') and with the UK Listing Authority's Listing Rules and Disclosure Rules ('UKLA Rules'). A breach of the Companies Act could result in the Company and/or the directors being fined or becoming the subject of criminal proceedings. Breach of the UKLA Rules could result in the suspension of the Company's shares which would itself constitute a breach of the provisions of the CTA.

These requirements offer significant protection for shareholders. The Board relies on the CEO, the AIFM, the Company Secretary and the Group's professional advisers to ensure compliance with all applicable rules. WIS is authorised and regulated by the FCA to act as the AIFM for Witan, for the marketing and administration of savings plans and the provision of investment advice to professional clients.

Liquidity

The Company's portfolio consists mainly of readily realisable securities. The Company and its AIFM regularly review liquidity needs (for example operational costs, loan servicing and repayment, shareholder dividends and share buybacks) relative to the Company's portfolio income and the value and tradability of the Company's assets. Most of the likely liquidity requirements are foreseeable (for example timetabled loan payments and dividends) while others (such as share buybacks) are subject to the Company's discretion. The Board is satisfied that unexpected liquidity needs are not significant and could be readily met without compromising normal portfolio management practice.

Page 20 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Viability Statement

In accordance with the 2016 UK Corporate Governance Code, the Board has assessed the prospects of the Company over a longer period than the 12 months required by the 'Going Concern' provision.

The Company's current position and prospects are set out in the Chairman's and Chief Executive's Report and the Strategic Report. The principal risks are set out on pages 17 to 19. The Board has considered the Company's financial position and its ability to liquidate its portfolio and meet its expenses as they fall due and notes the following:

> The portfolio consists of investments traded on major international stock exchanges and there is a spread of investments. In normal conditions, the current portfolio could be liquidated to the extent of more than 87% within 5 trading days and there is no expectation that the nature of the investments held will be materially different in future;

> The closed-ended nature of the Company means that, unlike an open-ended fund, it does not need to realise investments when shareholders wish to sell their shares;

> The Board has considered the viability of the Company under various scenarios and concluded that it would usually be able to take appropriate action to protect the value of the Company's assets. As set out in note 14 to the accounts, the Board has considered price risk sensitivity (the sensitivity of the profit after taxation for the year and the value of the shareholders' funds to changes in the fair value of the Group's investments) and foreign currency sensitivity (the sensitivity to changes in the exchange rates for the £/US dollar, £/Euro and £/Japanese yen);

> In addition to its cash balances, which were £74m at 31 December 2017 (2016: £49.2m), the Company has a short-term bank facility which can be used to meet its liabilities, and fixed-rate financing in the form of Secured Bonds, Secured Notes and cumulative preference shares. With the exception of the short-term facility, this financing will remain in place until at least 2025. Details of the Company's non-current liabilities are set out in note 13 to the accounts;

> The expenses of the Company are predictable and modest in comparison with the assets and there are no capital commitments currently foreseen which would alter that position.

As well as considering the principal risks on pages 18 and 19 and the financial position of the Company, the Board has made the following assumptions in considering the Company's longer-term viability:

> The Company's remit of investing in the securities of global listed companies will continue to be an activity to which investors will wish to have exposure;

> Investors will continue to want to invest in closed-ended investment trusts;

> The performance of the Company will continue to be satisfactory. The Board is able to replace any of the current investment managers when it considers it appropriate to do so;

> The Company will continue to have access to adequate capital when required;

> The Company will continue to be able to fund share buybacks when required. The Company bought back 2.8m ordinary shares in 2017 at a cost of £26.6m and experienced no issues with liquidity in doing so. It had shareholders' funds in excess of £1.9bn at the end of 2017.

Page 21 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Strategic Report continued

Based on the results of its review, and taking into account the long-term nature of the Company and its financing, the Board has a reasonable expectation that the Company will be able to continue its operations and meet its expenses and liabilities as they fall due for the foreseeable future, taken to mean at least the next five years. The Board has chosen this figure because, whilst it has no information to suggest this judgement will need to change in the coming five years, forecasting over longer periods is imprecise. The Board's long-term view of viability will of course be updated each year in the Annual Report.

Going concern

In light of the conclusions drawn in the foregoing Liquidity and Viability Statements, the Company has adequate financial resources to continue in operational existence for at least the next 12 months. Therefore, the directors believe that it is appropriate to continue to adopt the going concern basis in preparing the financial statements. In reviewing the position as at the date of this report, the Board has considered the guidance on this matter issued by the Financial Reporting Council.

Approval

This report was approved by the Board of Directors on 12 March 2018 and is signed on its behalf by:

H M Henderson A L C Bell

Chairman Chief Executive

12 March 2018

Page 22 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Statement of Directors' Responsibilities

in respect of the Annual Report and the financial statements

Responsibility statement

The directors as at the date of the Annual Report confirm to the best of their knowledge that :

· the financial statements, prepared in accordance with International Financial Reporting Standards as adopted by the EU, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole; and

· the Strategic Report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description (on pages 18 to 19) of the principal risks and uncertainties that they face.

The directors also confirm that the financial statements, taken as a whole, are fair, balanced and understandable, and provide the information necessary for shareholders to assess the Company's position, performance, business model and strategy.

By order of the Board

H M Henderson

Chairman

A L C Bell

Chief Executive

12 March 2018

Page 23 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Financial Highlights as at 31 December 2017

Key data

	2017	2016	% change
Share price	1079.0p	902.0p	+19.6
NAV per ordinary share (debt at par value)⁽⁴⁾	1109.8p	952.8p	+16.5
NAV per ordinary share (debt at fair value)⁽⁴⁾	1096.2p	939.2p	+16.7
Discount (NAV including income, debt at fair value)^{(1) (4)}	1.6%	4.0%

Total return performance

	1yr % Return	3yrs % Return	5yrs % Return
Total shareholder return⁽²⁾⁽⁴⁾	22.1	52.7	140.4
Net asset value total return⁽²⁾⁽⁴⁾	19.0	55.7	114.9
Witan Benchmark⁽²⁾	15.1	46.5	86.6
FTSE All-Share Index⁽³⁾	13.1	33.3	63.0
FTSE World Index⁽³⁾	13.8	53.5	106.7
UK CPI Return	3.0	4.8	7.5

(1) The average discount on this basis in 2017 was 2.8% (2016: 5.8%), (Source: Morningstar)

(2) Source: Morningstar.

(3) Source: Morningstar. See also FTSE International for conditions of use ( www.ftse.com ).

(4) Alternative Performance Measure (see page 24)

Dividend information

2017

2016

% change

Revenue per share

23.8p

22.1p

+7.7%

Dividend per share

21.0p

19.0p

+10.5%

Since 2007, Witan's dividend per share has risen 112%, compared with 26% for the UK consumer price index.

2018 dividend schedule

Ex-dividend date	Pay date	Dividend type	Dividend payable per share
01 March 2018	29 March 2018	Fourth interim (2017)	6.75p
17 May 2018	18 June 2018	First interim	5.25p
23 August 2018	18 September 2018	Second interim	5.25p
22 November 2018	18 December 2018	Third interim	5.25p

Please note that the dates and amounts for the first, second and third interim dividends could be subject to change.

Page 24 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Financial Highlights (continued)

Other financial information

	2017	2016	% change
Net assets	£1,980,521,000	£1,726,637,000	+14.7
Number of ordinary shares in issue ⁽¹⁾	200,071,000	200,071,000	-
Gearing⁽²⁾	9.7%	10.3%
Ongoing charge excluding performance fee⁽²⁾	0.76%	0.75%
Ongoing charge including performance fee⁽²⁾	0.78%	0.65%

(1) Of which 21,621,411 (2016: 18,860,261) shares are held in treasury

(2) Alternative Performance Measure (see below)

Alternative Performance Measures

The financial statements in the Annual Report set out the required statutory reporting measures of the Company's financial performance. In addition, the Board assesses the Company's performance against a range of criteria which are viewed as particularly relevant for investment trusts, which are summarised on pages 23 and 24 and explained in greater detail in the Strategic Report, under the heading 'Key Performance Indicators' on page 6. Definitions of the terms used and a reconciliation of the NAV per ordinary share (debt at par value) to the NAV per ordinary share (debt at fair value) are set out in the Annual Report.

Page 25 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Consolidated Statement of Comprehensive Income

for the year ended 31 December 2017

	Year ended 31 December 2017			Year ended 31 December 2016
	Revenue return £'000	Capital return £'000	Total £'000	Revenue return £'000	Capital return £'000	Total £'000
Investment income (note 2)	54,425	-	54,425	52,452	-	52,452
Other income (note 3)	1,318	-	1,318	1,475	-	1,475
Gains on investments held at fair value through profit or loss	-	289,268	289,268	-	297,032	297,032
Foreign exchange losses on cash and cash equivalents	-	(1,686)	(1,686)	-	(417)	(417)
	----------	----------	----------	----------	----------	----------
Total income	55,743	287,582	343,325	53,927	296,615	350,542

Expenses
Management and performance fees (note 4)	(2,255)	(7,294)	(9,549)	(1,905)	(4,252)	(6,157)

Other expenses	(6,361)	(101)	(6,462)	(5,109)	(101)	(5,210)
	----------	----------	----------	----------	----------	----------
Profit before finance costs and taxation	47,127	280,187	327,314	46,913	292,262	339,175

Finance costs	(1,967)	(5,651)	(7,618)	(2,467)	(7,148)	(9,615)
	----------	----------	----------	----------	----------	----------
Profit before taxation	45,160	274,536	319,696	44,446	285,114	329,560

Taxation	(2,493)	-	(2,493)	(2,415)	-	(2,415)
	----------	----------	----------	----------	----------	----------
Profit attributable to equity shareholders of the parent company	42,667	274,536	317,203	42,031	285,114	327,145
	----------	----------	----------	----------	----------	----------

Earnings per ordinary share (note 5)	23.82p	153.24p	177.06p	22.11p	149.95p	172.06p
	======	======	======	======	======	======

The total column of this statement represents the Group's Statement of Comprehensive Income, prepared in accordance with IFRSs as adopted by the European Union.

The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies.

The Group does not have any other comprehensive income and hence the total profit, as disclosed above, is the same as the Group's total comprehensive income.

All items in the above statement derive from continuing operations.

All income is attributable to the equity holders of Witan Investment Trust plc, the parent company. There are no non-controlling interests.

Page 26 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Consolidated and Individual Company Statement of Changes in Equity

for the year ended 31 December 2017

Group: Year ended 31 December 2017
		Ordinary	Share	Capital	Other
		share	premium	redemption	capital	Revenue
		capital	account	reserve	reserves	reserve	Total
		£'000	£'000	£'000	£'000	£'000	£'000
Total equity at 31 December 2016		50,018	99,251	46,498	1,464,105	66,765	1,726,637
Total comprehensive income:
Profit for the year		-	-	-	274,536	42,667	317,203
Transactions with owners,
recorded directly to equity:
Ordinary dividends paid (note 7)		-	-	-	-	(36,697)	(36,697)
Buybacks of ordinary shares (held in treasury)		-	-	-	(26,622)	-	(26,622)
		--------	---------	---------	------------	---------	------------
Total equity at 31 December 2017		50,018	99,251	46,498	1,712,019	72,735	1,980,521

Company: Year ended 31 December 2017
		Ordinary	Share	Capital	Other
		share	premium	redemption	capital	Revenue
		capital	account	reserve	reserves	reserve	Total
		£'000	£'000	£'000	£'000	£'000	£'000
Total equity at 31 December 2016		50,018	99,251	46,498	1,464,915	65,955	1,726,637
Total comprehensive income:
Profit for the year		-	-	-	274,178	43,025	317,203
Transactions with owners,
recorded directly to equity:
Ordinary dividends paid (note 7)		-	-	-	-	(36,697)	(36,697)
Buybacks of ordinary shares (held in treasury)		-	-	-	(26,622)	-	(26,622)
		--------	---------	---------	------------	---------	------------
Total equity at 31 December 2017		50,018	99,251	46,498	1,712,471	72,283	1,980,521

Group: Year ended 31 December 2016
		Ordinary	Share	Capital	Other
		share	premium	redemption	capital	Revenue
		capital	account	reserve	reserves	reserve	Total
		£'000	£'000	£'000	£'000	£'000	£'000
Total equity at 31 December 2015		50,018	99,251	46,498	1,321,909	59,654	1,577,330
Total comprehensive income:
Profit for the year		-	-	-	285,114	42,031	327,145
Transactions with owners,
recorded directly to equity:
Ordinary dividends paid (note 7)		-	-	-	-	(34,920)	(34,920)
Buybacks of ordinary shares (held in treasury)		-	-	-	(142,918)	-	(142,918)
	--------	---------	---------	------------	---------	------------	------------
Total equity at 31 December 2016		50,018	99,251	46,498	1,464,105	66,765	1,726,637

Company: Year ended 31 December 2016
		Ordinary	Share	Capital	Other
		share	premium	redemption	capital	Revenue
		capital	account	reserve	reserves	reserve	Total
		£'000	£'000	£'000	£'000	£'000	£'000
Total equity at 31 December 2015		50,018	99,251	46,498	1,322,517	59,046	1,577,330
Total comprehensive income:
Profit for the year		-	-	-	285,316	41,829	327,145
Transactions with owners,
recorded directly to equity:
Ordinary dividends paid (note 7)		-	-	-	-	(34,920)	(34,920)
Buybacks of ordinary shares (held in treasury)		-	-	-	(142,918)	-	(142,918)
		--------	---------	---------	---------------	---------	------------
Total equity at 31 December 2016		50,018	99,251	46,498	1,464,915	65,955	1,726,637

Page 27 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Consolidated and Individual Company Balance Sheets

As at 31 December 2017

	Group	Company	Group	Company
	31 December	31 December	31 December	31 December
	2017	2017	2016	2016
	£'000	£'000	£'000	£'000
Non current assets
Investments held at fair value through profit or loss	2,149,267	2,150,619	1,884,037	1,885,747
	--------------	--------------	--------------	--------------
Current assets
Other receivables	5,217	5,077	11,638	11,038
Cash and cash equivalents	75,795	74,031	50,556	49,155
	-----------	-----------	-----------	-----------
	81,012	79,108	62,194	60,193
	-----------	-----------	-----------	-----------

Total assets	2,230,279	2,229,727	1,946,231	1,945,940
	---------------	---------------	---------------	---------------

Current liabilities
Other payables	(6,393)	(5,841)	(8,102)	(7,811)
Bank loans	(73,000)	(73,000)	(71,000)	(71,000)
	----------	----------	----------	----------
	(79,393)	(78,841)	(79,102)	(78,811)
	----------	----------	----------	----------
Total assets less current liabilities	2,150,886	2,150,886	1,867,129	1,867,129

Non current liabilities
At amortised cost:
6.125 per cent. Secured Bonds due 2025	(63,538)	(63,538)	(63,434)	(63,434)
3.29 per cent. Secured Notes due 2035	(20,871)	(20,871)	(20,864)	(20,864)
3.47 per cent. Secured Notes due 2045	(53,652)	(53,652)	(53,639)	(53,639)
2.74 per cent. Secured Notes due 2054	(29,749)	(29,749)	-	-
3.4 per cent. cumulative preference shares of £1	(2,055)	(2,055)	(2,055)	(2,055)
2.7 per cent. cumulative preference shares of £1	(500)	(500)	(500)	(500)
	----------	----------	----------	----------
	(170,365)	(170,365)	(140,492)	(140,492)
	----------	----------	----------	----------
Net assets	1,980,521	1,980,521	1,726,637	1,726,637

Equity attributable to equity holders
Ordinary share capital	50,018	50,018	50,018	50,018
Share premium account	99,251	99,251	99,251	99,251
Capital redemption reserve	46,498	46,498	46,498	46,498
Retained earnings:
Other capital reserves	1,712,019	1,712,471	1,464,105	1,464,915
Revenue reserve	72,735	72,283	66,765	65,955
	----------	----------	----------	----------
Total equity	1,980,521	1,980,521	1,726,637	1,726,637

Net asset value per ordinary share	1109.85p	1109.85p	952.83p	952.83p

As permitted by section 408 of the Companies Act 2006, the Company has not presented its own income statement. The profit of the Company dealt with in the accounts of the Group amounted to £317,203,000 (2016: £ 327,145 ,000).

Page 28 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Consolidated and Individual Company Cash Flow Statements

for the year ended 31 December 2017

	Group	Company	Group	Company
	2017	2017	2016	2016
	£'000	£'000	£'000	£'000
Cash flows from operating activities
Dividend income received	55,464	55,464	49,178	49,178
Interest received	29	28	90	87
Other income received	2,105	195	1,384	291
Operating expenses paid	(12,644)	(11,096)	(14,688)	(13,988)
Taxation on overseas income	(3,014)	(3,014)	(2,883)	(2,883)
Taxation recovered	412	412	371	371
	----------	-----------	----------	-----------
Net cash inflow from operating activities	42,352	41,989	33,452	33,056
	----------	-----------	----------	-----------

Cash flows from investing activities
Purchases of investments	(1,097,207)	(1,097,207)	(525,517)	(525,517)
Sales of investments	1,113,894	1,113,894	641,967	641,967
Realised gain on futures	7,593	7,593	7,548	7,548
	----------	-----------	----------	-----------
Net cash inflow from investing activities	24,280	24,280	123,998	123,998
	----------	-----------	----------	-----------

Cash flow from financing activities
Equity dividends paid	(36,697)	(36,697)	(34,920)	(34,920)
Issue of secured notes net of issue expenses	29,748	29,748	-	-
Buybacks of ordinary shares	(27,413)	(27,413)	(142,081)	(142,081)
Repayment of debenture	-	-	(44,589)	(44,589)
Interest paid	(7,345)	(7,345)	(10,474)	(10,474)
Drawdown of bank loans	2,000	2,000	68,000	68,000
	----------	-----------	----------	-----------
Net cash outflow from financing activities	(39,707)	(39,707)	(164,064)	(164,064)
	----------	-----------	----------	-----------

Increase/(decrease) in cash and cash equivalents	26,925	26,562	(6,614)	(7,010)
Cash and cash equivalents at the start of the period	50,556	49,155	57,587	56,582
Effect of foreign exchange rate changes	(1,686)	(1,686)	(417)	(417)
	----------	-----------	----------	-----------
Cash and cash equivalents at the end of the period	75,795	74,031	50,556	49,155

Page 29 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Notes to the Financial Statements

for the year ended 31 December 2017

1. Accounting policies

The financial statements of the Group have been prepared in accordance with International Financial Reporting Standards ('IFRSs') as adopted by the European Union and therefore the Group financial statements comply with Article 4 of the EU IAS Regulation. These comprise standards and interpretations approved by the International Accounting Standards Board ('IASB'), together with interpretations of the International Accounting Standards and Standing Interpretations Committee approved by the International Accounting Standards Committee ('IASC') that remain in effect, to the extent that they have been adopted by the European Union.

These financial statements are presented in pounds sterling because that is the currency of the primary economic environment in which the Group operates.

(a) Basis of preparation

The financial statements have been prepared on the historical cost basis, except for the revaluation of certain financial instruments. The principal accounting policies adopted are set out below. Where presentational guidance set out in the Statement of Recommended Practice Financial Statements of Investment Trust Companies and Venture Capital Trusts ('the SORP') issued by the Association of Investment Companies ('the AIC') in November 2014 and updated in January 2017 with consequential amendments, is consistent with the requirements of IFRSs as adopted by the European Union, the directors have sought to prepare the financial statements on a basis compliant with the recommendations of the SORP.

Judgements and sources of estimation uncertainty

In the application of the Group's accounting policies, management is required to make judgements, estimates and assumptions about carrying values of assets and liabilities that are not always readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may vary from these estimates. The Directors do not consider that there are any such items in these financial statements.

(b) Going concern

The financial statements have been prepared on a going concern basis. The Group's business activities, together with the factors likely to affect its future development and performance, are set out in the Strategic Report on pages 5 to 21. The financial position of the Group as at 31 December 2017 is shown on the balance sheet on page 27. The cash flows of the Group for the year ended 31 December 2017 are not untypical and are set out on page 28. The Company had fixed debt and preference share capital totalling £170,365,000. In 2017, the Group renewed a one-year secured multi-currency borrowing facility for £125 million, of which £73 million was drawn down at 31 December 2017 (2016: £71 million of £75 million facility).

The consolidated financial statements incorporate the financial statements of the Company and the entity controlled by the Company (its subsidiary) made up to 31 December each year.

In accordance with IFRS10 the Company has been designated as an investment entity on the basis that:

- It obtains funds from investors and provides those investors with investment management services;

- It commits to its investors that its business purpose is to invest solely for returns from capital appreciation and investment income; and

- It measures and evaluates performance of substantially all of its investments on a fair value basis.

The subsidiary of the Company was established for the sole purpose of operating or supporting the investment operations of the Company, and is not itself an investment entity. Therefore, under the principles of IFRS 10, the Company has consolidated its subsidiary as it is a controlled entity that supports the investment activity of the investment entity.

Page 30 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Notes to the Financial Statements continued

Control is achieved where the Company is exposed, or has the right, to variable returns from its investment in the subsidiary and has the ability to affect those returns through its power to direct the relevant activities. Where necessary, adjustments are made to the financial statements of the subsidiary to bring the accounting policies used by it into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

(d) Presentation of the Statement of Comprehensive Income

In order to better reflect the activities of an investment trust company, and in accordance with guidance issued by the AIC, supplementary information which analyses the Statement of Comprehensive Income between items of a revenue and capital nature has been presented alongside the Statement of Comprehensive Income. In accordance with the Company's Articles of Association, net capital returns may not be distributed by way of dividend. Additionally, the net revenue is the measure the directors believe appropriate in assessing the Group's compliance with certain requirements set out in section 1158 of the Corporation Tax Act 2010.

2. Investment income


	2017	2016
	£'000	£'000
Franked:
UK dividends from listed investments	21,117	20,878
UK stock dividends from listed investments	43	841
UK ? special dividends from listed investments	1,040	1,019
	-----------	-----------
	22,200	22,738
	-----------	-----------
Unfranked:
Overseas dividends from listed investments	30,161	26,433
Overseas special dividends from listed investments	683	1,041
Property income dividends	81	186
Stock dividends from listed investments	491	888
Fixed interest and convertible bonds	809	1,166
	-----------	-----------
	32,225	29,714
	-----------	-----------
Total investment income	54,425	52,452

	2017	2017
	£'000	£'000
Analysis of investment income by geographical segment:
United Kingdom	22,200	22,739
North America	6,260	7,464
Continental Europe	15,290	13,516
Japan	2,145	2,121
Asia Pacific (ex Japan)	7,237	5,662
Latin America	536	108
Other	757	842
	-----------	-----------
Total investment income	54,425	52,452

Page 31 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Notes to the Financial Statements continued

3. Other income


	2017	2016
	£'000	£'000
Deposit interest	41	91
Underwriting commission	4	34
Stock lending income	180	242
Income from the subsidiary company's third party business	1,093	1,108
	-----------	-----------
	1,318	1,475

4. Management fees

	Year ended 31 December 2017			Year ended 31 December 2016
	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000

Management fees	2,255	6,766	9,021	1,905	5,715	7,620
Performance fees	-	528	528	-	(1,463)	(1,463)
	----------	-----------	-----------	----------	-----------	-----------
	2,255	7,294	9,549	1,905	4,252	6,157

5. Earnings per ordinary share

The earnings per ordinary share figure is based on the net profit for the year of £317,203,000 (2016: £327,145,000) and on 179,149,747 ordinary shares (2016: 190,131,108), being the weighted average number of ordinary shares in issue during the year.

The earnings per ordinary share figure detailed above can be further analysed between revenue and capital, as below. The Company has no securities in issue that could dilute the return per ordinary share. Therefore the basic and diluted earnings per ordinary share are the same.

	2017	2016
	£'000	£'000

Net revenue profit	42,667	42,031
Net capital profit	274,536	285,114
	----------	----------
Net total profit	317,203	327,145

Weighted average number of ordinary shares in issue during the year	179,149,747	190,131,108

	Pence	Pence
Revenue earnings per ordinary share	23.82	22.11
Capital earnings per ordinary share	153.24	149.95
	----------	----------
Total earnings per ordinary share	177.06	172.06

Page 32 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Notes to the Financial Statements continued

6. Issued share capital

The number of ordinary shares of 25p each in issue at 31 December 2017 was 200,071,000 (2016: 200,071,000), of which 21,621,411 ordinary shares of 25p each were held in treasury (2016: 18,860,261).

7. Dividends

	2017 £'000	2016 £'000
Amounts recognised as distributions to equity holders in the year:
Fourth interim dividend for the year ended 31 December 2016 of 6.25p (2015: 5.45p) per ordinary share	11,246	10,895
First interim dividend for the year ended 31 December 2017 of 4.75p (2016: 4.25p) per ordinary share	8,509	8,490
Second interim dividend for the year ended 31 December 2017 of 4.75p (2016: 4.25p) per ordinary share	8,485	7,817
Third interim dividend for the year ended 31 December 2017 of 4.75p (2016: 4.25p) per ordinary share	8,478	7,739

Refund of unclaimed dividends	(21)	(21)
	----------	----------
	36,697	34,920
	======	======

Fourth interim dividend for the year ended 31 December 2017 of 6.75p (2016: 6.25p) per ordinary share	12,038	11,246
	======	======

Total in respect of the year:
Set out below is the total dividend to be paid in respect of the year. This is the basis on which the requirements of section 1158 of the Corporation Tax Act 2010 are considered.

	2017 £'000	2016 £'000
Revenue profits available for distribution (Company only)	43,025	41,829
First interim dividend for the year ended 31 December 2017 of 4.75p (2016: 4.25p) per ordinary share	(8,509)	(8,490)
Second interim dividend for the year ended 31 December 2017 of 4.75p (2016: 4.25p) per ordinary share	(8,485)	(7,817)
Third interim dividend for the year ended 31 December 2017 of 4.75p (2016: 4.25p) per ordinary share	(8,478)	(7,739)
Fourth interim dividend for the year ended 31 December 2017 of 6.75p (2016: 6.25p) per ordinary share	(12,038)	(11,246)
	----------	----------
Revenue retained for the year (Company only)	5,515	6,537
	======	======

8. 2017 Accounts

The figures and financial information for 2017 are extracted from the Annual Report and Financial Statements for the year ended 31 December 2017 and do not constitute the statutory accounts for the year. The Annual Report and Financial Statements include the Report of the Independent Auditor which is unqualified and does not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006. The Annual Report and Financial Statements have not yet been delivered to the Registrar of Companies.

Page 33 of 33

WITAN INVESTMENT TRUST PLC

Annual Financial Report for the year ended 31 December 2017

Notes to the Financial Statements continued

9. 2016 Accounts

The figures and financial information for 2016 are extracted from the published Annual Report and Financial Statements for the year ended 31 December 2016 and do not constitute the statutory accounts for that year. The Annual Report and Financial Statements have been delivered to the Registrar of Companies and included the Report of the Independent Auditor which was unqualified and did not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006.

10. Annual Report and Financial Statements

Copies of the Annual Report and Financial Statements will be posted to shareholders by the end of March 2018 and will be available on the Company's website (www.witan.com) or in hard copy format from the Registered Office, 14 Queen Anne's Gate, London, SW1H 9AA.

The Annual General Meeting will be held at 2.30 pm on Wednesday, 2 May 2018 at Merchant Taylors' Hall, 30 Threadneedle Street, London EC2R 8JB.

For further information please contact:

Andrew Bell

Chief Executive

Witan Investment Trust plc

Telephone: 020 7227 9770

Alexis Barling

Director of Marketing

Witan Investment Trust plc

Telephone: 020 7227 9770

- ENDS -

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.