Coronavirus (Covid-19) – Update

THE SCOTTISH AMERICAN INVESTMENT COMPANY P.L.C.

Legal Entity Identifier: 549300NF03XVC5IFB447

Coronavirus (Covid-19) - Update

Further to the announcement on 27 March 2020 of payment to shareholders of a fourth interim dividend (instead of a shareholder approved final dividend), the Board of The Scottish American Investment Company P.L.C. (SAINTS) wishes to provide a further update to shareholders in the light of developments relating to the Coronavirus (Covid-19).

Operational update

The Board has reviewed the operational resilience of its Managers and other service providers and is comfortable with the effectiveness of their business continuity arrangements, and the stability and robustness of their operations.

Investment update

The Board and the Managers recognise the significant disruption to the global economy being caused by the coronavirus (Covid-19). The Board is, however, encouraged by updates from SAINTS' managers. In the current environment Baillie Gifford's emphasis on operational resilience and dependability in selecting stocks is proving helpful. Similarly, the property manager's emphasis on long leases and strong covenants is providing a good level of protection, although the Board is also conscious of its responsibility to act as a responsible landlord in the current testing circumstances.

Dividend Outlook

Overall, current expectations are that there will be some drop in SAINTS' revenues in 2020 relative to 2019. SAINTS' own dividend payments are nonetheless expected to be largely supported by anticipated revenues and are also underpinned by SAINTS' significant reserves. At 31 December 2019 SAINTS' revenue reserves stood at over £17m. After deducting the cost of the recently declared fourth interim dividend, the adjusted revenue reserves are equivalent to roughly 9 months of dividend payments (based on the rate of that dividend).

The Board remains confident in the long-term prospects of SAINTS' investments. Taken with the support available from SAINTS' reserves, the Board is therefore also confident in SAINTS' ability to pay a reliable dividend to its shareholders.

Current activity

The Board is encouraging the Managers to be supportive shareholders, and to continue to take advantage of the three inherent strengths of their approach:

Long-term perspective - recognising that weakness in the world economy and its impact on business will allow some companies to emerge stronger than others from this difficult period.

Growth mindset - which we believe will help to ensure that growth in earnings and cashflows at SAINTS' holdings will resume, supporting future growth in the income stream.

Genuinely global - taking advantage of a global universe of more than 4,000 stocks, which allows them to be highly selective about the companies in which they invest for SAINTS.

The Board is pleased both that, after a thorough review by the Managers of the resilience and long-term prospects of SAINTS' holdings, turnover remains low, but also that the Managers are taking advantage of some opportunities to purchase new holdings in businesses they know well at attractive prices.

We would encourage shareholders to monitor SAINTS' website at www.saints-it.com.

Baillie Gifford & Co Limited

Company Secretaries

 9 April 2020

Regulated Information Classification: Additional regulated information required to be disclosed under applicable laws.