Half-yearly Report

Alliance Trust PLC

Interim Results for the six months ended 31 July 2008

Highlights

- Company net asset value down 4.8% in a challenging economic
  environment, compared to 8.4% decline in the FTSE All-Share 
  and 6.3% fall in the FTSE All-World Index over the same period

- Share price declined 8.9% in the period. The discount widened
  from 16% to 19.6%

- Continued the development of a more focused equity portfolio and
  the strategy of investing with more conviction

- Substantially increased cash levels. Net cash represents an
  historically high level of 10.7% of the Company's net assets

- Equities produced above benchmark index returns in UK Large Cap,
  UK Mid Cap, North America, Europe and Japan

- Consolidated administrative expenses down 3.7% compared to last
  year

- Dividend of 4.0p per share for the first two quarters (3.8p per
  share for the same period last year)

- Appointment of new Chief Executive, Katherine Garrett-Cox

- Strengthening of investment management teams.

Katherine Garrett-Cox, Chief Executive, commented:

"Against a background of turbulent global economies and volatile
stock markets, the past six months has been challenging. We anticipate that
this period of uncertainty will continue and we are actively managing our
asset allocation and stock selection to take advantage of opportunities in the
second half of the year.

A successful and well implemented investment philosophy is at the
heart of our business. We continue to develop the strength of our investment
teams and we are reviewing all aspects of our business to ensure that our
focus is firmly on improving our investment performance to deliver enhanced
shareholder value."

Contacts:

Amy Fisher,                                   Conor McClafferty/James Murgatroyd
Director Corporate Communications 

Alliance Trust                                Finsbury Group
Tel [phone]                      Tel [phone]
Mobile: [phone]


ALLIANCE TRUST PLC

INTERIM REPORT FOR THE SIX MONTHS ENDED 31 JULY 2008

Alliance Trust is a self-managed investment company with investment trust status. 
Our objective is to be a core investment for investors seeking increased value over 
the long-term.

We have no fixed asset allocation benchmark and we invest in a wide range of asset 
classes throughout the world to achieve our objective. Our focus is to generate a 
real return for shareholders over the medium to long term by a combination of capital 
growth and a rising dividend.

We pursue our objective by:

- Investing in both quoted and unquoted equities across the globe in different sectors 
and industries;

- Investing internationally in fixed income securities;

- Investing in other asset classes and financial instruments, either directly or through 
investment vehicles; and

- Investing in subsidiaries and associated businesses which allow us to expand into other 
related activities.

We are prepared to invest any proportion of the total corporate capital in any of the 
above asset classes, subject only to the restrictions imposed on us by the regulatory 
or fiscal regime within which we operate. However, we would expect equities to comprise 
at least 50% of our portfolio. Changes to the asset allocation will be dependent upon 
attractive investment opportunities being available.

Where market conditions permit, we will use gearing of not more than 30% of our net 
assets at any given time.

We can use derivative instruments to hedge, enhance and protect positions, including 
currency exposures.

 
Company Statistics                              31 July    31 January
                                                   2008          2008
 
Net Asset Value (basic)                          383.0p        402.3p
Net Asset Value (diluted)                        382.0p        401.7p
Share Price                                      308.0p        338.0p
Discount to basic Net Asset Value                 19.6%         16.0%
 


Performance for 6 months to 31 July 2008        Capital         Total
                                                               Return

Net Asset Value                                  (4.8%)        (3.6%)*
Share Price                                      (8.9%)        (7.7%)
FTSE All-Share Index                             (8.4%)        (6.2%)
FTSE All-World Index (sterling adjusted)         (6.3%)        (4.7%)
RPI (Retail Prices Index)                          3.2%

* Return after adding back dividends paid



Performance Summary

This interim report sets out the results of Alliance Trust PLC for the six months 
ended 31 July 2008.

Over the past six months the Company's basic net asset value per share declined 
by 4.8%. This return compares favourably to the 8.4% decline in the FTSE All-Share 
Index and with the 6.3% fall in the FTSE All-World Index over the same period. 
The net asset value return ranks 14th in a peer group of 43 Global Growth and Global 
Growth and Income Investment Trusts at the end of that period.

Disappointingly, despite the relative outperformance of the net asset value, the 
share price declined by 8.9% over the six months reflecting a widening of the discount 
from 16.0% to 19.6%.

In our Annual Report we noted that we expected the challenging investment environment 
to continue for some time. The Company's interim results are set against a background 
of turbulent global economies and stock markets. The problems in financial markets 
emanating from the credit crunch have spread into the wider global economy. Investors 
are confused and sentiment has been bleak.

We entered the period with net gearing of 4.8%. Acting on the belief that the full 
impact of the global economic slowdown on corporate earnings was not fully reflected 
in share prices we substantially increased cash levels throughout the six months. We 
reduced our equity exposure from 93.5% of net assets at 31 January 2008 to 76.9% at 
31 July 2008. As at 31 July 2008, net cash represented an historically high level of 
10.7% of the Company's net assets. We raised cash generally across the equity portfolios, 
as all major markets were under pressure, actively reducing our Asian holdings and 
retaining our very low exposure to Japan.

Investment Activity

Equities

In our quoted equity portfolio, we have continued the process of focusing our number 
of holdings by investing with high conviction.

We achieved above benchmark index returns in several areas, namely UK Large Cap, UK 
Mid Cap, North America, Europe and Japan.


Quoted Equity Portfolio Statistics

From 31 January 2008 to 31 July 2008
 
                      Net        Portfolio      Benchmark Index   Relative
                     Assets %     Return %        Return %        Return %
 
UK Large Cap          32.5         (5.1)          (6.1)             1.0
UK Mid Cap            6.3          (2.5)          (7.6)             5.5
North America         18.3          2.8           (5.2)             8.4
Europe ex UK          10.7         (1.8)          (3.2)             1.4
Asia Pacific ex Japan 6.8         (12.6)          (8.5)            (4.5)
Japan                 1.2          (3.4)          (3.7)             0.3


The UK economy has endured very tough conditions over the past six months. We have 
faced an economic slowdown heading towards a possible recession, while at the same 
time inflation has been rising, driven by higher energy and food costs. Interest rate 
policy has been constrained by rising inflation and as a result we have not yet seen 
the interest rate cuts we had anticipated as being possible earlier in the year. In 
this environment, financial companies, in particular the banks, and house builders have 
suffered badly. Early in the period, we reduced our holdings in UK banks, including 
the sale of Lloyds TSB. Our relative outperformance in our UK Large Cap portfolio was 
helped by an underweight position in financial companies and by strong performance in 
resources and basic materials. We disposed of our investment in Anglo American following 
a strong rise in mining stocks.

In the UK Mid Cap area, visibility of earnings growth commands a premium in the uncertain 
times we are experiencing and good stock selection has benefited the portfolio. High 
oil prices have helped oil services companies as the "stronger for longer" theme has 
gained more supporters. Oil companies need to replace reserves and their capital expenditure 
is unlikely to be cut. Support services companies with exposure to defence and PFI business 
such as Serco and Babcock are continuing to win new contracts and to grow their order books. 
Some engineering companies, such as Weir and Spirax, continue to enjoy good demand in 
specific industries and are benefiting from the weakening of sterling.

Our North American portfolio has generated positive absolute returns in a falling market. 
The fallout from the credit crunch continued with the stress within the US financial 
system highlighted by the collapse of Bear Stearns and Lehman Brothers. The portfolio 
benefited from a limited exposure to financial companies, although we did take the 
opportunity to purchase a holding in New York Community Bank which should benefit from 
the distress being suffered by its competitors. The surge in oil and gas prices served 
our portfolio well with its heavy weighting in energy stocks.

Against the backdrop of deteriorating economic conditions and weakening corporate earnings, 
the decision was taken in late May to reduce our exposure to the US. The partial reduction 
was implemented by opening a sell position on an S&P Future, taking advantage of the 
flexibility offered by such a derivative instrument.

In the period we increased our shareholding in Plum Creek Timber which has performed well. 
The company is the largest private timberland owner in the United States. In addition to 
managing its trees for the long term, it is realising the value of its forestry land through 
selective sales to private equity investors, conservationists and developers.

We do not expect a rapid recovery for the US economy. We retain a defensive bias in the 
portfolio, preferring companies we believe can sustainably grow profits. Outside of the 
financial and property sectors, many companies are well financed and it is encouraging that 
we can still identify attractive investments.

The financial crisis which developed first in the United States has spread to Europe and 
the resulting deleveraging is now being undertaken. This is going to have a negative impact 
on growth.

Domestic European economies are now slowing markedly and the region as a whole faces the 
possibility of sliding into recession. In particular, the economies of Spain and Ireland 
have been worst hit as the unwinding of the property bubble takes effect. Holdings in the 
portfolio which have performed strongly include Syngenta, on the back of strength in agricultural 
commodity markets, and Linde which is benefiting from strong energy markets.

The immediate outlook remains difficult for the European region. However, if inflation has 
peaked, there is scope for some assistance from the European Central Bank by way of interest 
rate cuts.

Asia Pacific equities traded on historically high ratings in early 2008 which made them 
vulnerable as the global economy slowed. We actively reduced our exposure to Asia during 
the period. We hold a number of high quality companies in the portfolio such as China Life 
Insurance, which is experiencing strong new premium growth, and Taiwan Semiconductor 
Manufacturing which is gaining market share as more semiconductor companies decide to 
outsource chip production. Asian markets are now trading at ten year valuation lows and, 
although slowing, Asian economic growth is stronger than other major economies. This should 
produce some attractive opportunities when market stability returns. In Japan, the economy 
continued to deteriorate and we expect to see a further round of downward earnings revisions 
when companies announce their half-year results later in the year. We have retained our very 
low exposure to Japan and, for now, see no reason to change this view.

Other Asset Classes

The value of our UK Commercial Property portfolio fell to £64.5 million over the past six 
months. Gross rental income amounted to £2.2 million and all properties are fully let. We 
maintained our cautious approach to investment in the sector. We have not added to the property 
portfolio since May 2007.

The UK commercial property market witnessed a sharper than expected correction in prices during 
the period. Transaction activity is at an all time low. It is likely that capital values will 
continue to fall until such time as the banks are in a position to recommence lending to the 
sector. We anticipate that this may take until mid-2010.

Private Equity

Alliance Trust Equity Partners ("ATEP") is the Private Equity arm of Alliance Trust. In the 
first half of the year we have positioned ATEP for growth over the coming years. The intention 
is to build a differentiated `Fund of Funds' business providing superior returns for the Company 
and raising third party funds in due course.

The ATEP team has been focused on mapping the top performing European private equity managers 
and reviewing and researching a number of strong investment opportunities. This will culminate 
in commitments to private equity funds in the second half of the year. The ATEP team completed 
a commitment in January 2008 to August Equity II, a UK lower mid market management buyout fund, 
where we believe we will be able to enhance our returns through co-investment opportunities in 
the future. This fund commitment was based on August Equity's strong track record in their market 
sector and on a long standing relationship between the August and ATEP teams.

In addition, the ATEP team provided input to the Company's investment in Climate Change Capital 
Group ("CCCG"), a specialist fund management business with a focus on opportunities arising 
from the transition to a low carbon economy. This is an area that we believe will provide 
growing opportunity in the future and where CCCG has taken a market leading position.

The capital value of the Preference Stock portfolio fell by 7.6% over the past six months, 
reflecting the continuing weakness in the UK financial sector. The income yield, however, 
remains attractive.

Financial Services Subsidiaries

Over the long term we expect our wholly owned subsidiaries, which represent a small proportion 
of the portfolio at the moment, to produce a substantial return on the capital invested. We 
also expect these to contribute additional revenue to the Company.

Alliance Trust Savings expanded its fund supermarket to offer a wider range of investment funds 
and introduced real time telephone dealing. It is shortly to launch an initiative to grow its 
new and important adviser channel. For the six months ending 31 July 2008, income grew to £8.6m, 
a 31% increase compared to the equivalent period last year. Operating expenses in the period are 
down by almost £1m on the same period last year. Further, no exceptional expenses were incurred 
in this period compared to £2.2m in the equivalent period last year. Performance in the second 
half will depend on how clients react to the tough economic environment.

We continue to develop a UK asset management subsidiary. Alliance Trust Asset Management received 
Financial Services Authority authorisation during the period. When launched next year investors 
will be able to access the Alliance Trust style of investment in a range of specialist funds.

Outlook

Global markets are dominated at the present time by the repercussions of the credit crunch. The 
share prices of financial companies are extremely volatile. In the UK, HBOS has been forced into 
a takeover by Lloyds TSB. The Financial Services Authority is seeking to stabilise the market by 
introducing a temporary ban on the short-selling of financial stocks.

Two further major US investment banks have followed Bear Stearns in falling prey to the crisis, 
with Lehman Brothers having filed for Chapter 11 bankruptcy protection and Merrill Lynch being 
acquired by Bank of America in a $50 billion deal. The US Treasury is providing an $85 billion 
rescue package for AIG, once the world's largest insurer, and has bailed out mortgage providers 
Fannie Mae and Freddie Mac to help restore confidence to global financial markets.

We remain some way from the fully functioning banking system which we indicated in our Annual 
Report as a prerequisite for a return to economic growth, although central banks around the 
world have injected many billions of dollars into money markets in an attempt to ease the 
liquidity crisis. The US authorities are working on an emergency plan to enable banks to free 
their balance sheets of illiquid assets.

Slowing growth and rising inflation have been the major global economic themes of recent months. 
The oil price has fallen back sharply from its high of $147 per barrel reached in July. Sterling 
has weakened against both the euro and the dollar, reflecting deteriorating economic conditions 
in the UK. Export companies should benefit from weaker sterling although European markets are 
experiencing a sharp fall in consumer confidence. Interest rate reductions by the European Central 
Bank may be needed later in the year to boost European economies. In Asia, Chinese inflation 
should be past the worst as the impact of food prices, a major component of the Consumer Price 
Index, has peaked.

It is a challenging operating environment for all companies and a time to ensure that our investment 
processes, risk management and decision making within our portfolios are rigorous and sharp. Our 
focus remains on identifying and investing in high quality companies with strong balance sheets 
and experienced and tested management. We currently retain relatively high cash balances.

Dividend

In accordance with our quarterly dividend policy the Company paid an interim dividend of 2.0p 
per share on 31 July 2008 and a second interim dividend of 2.0p per share will be paid on or 
around 31 October 2008 to shareholders on the register on 10 October 2008. For the financial 
year ending 31 January 2009 and in the absence of any unforeseen developments, we expect to 
be able to recommend a third interim dividend of 2.0p payable on or around 31 January 2009, 
and a fourth interim dividend of at least 2.0p payable on or around 30 April 2009.

Responsibility statement of the directors in respect of the half-yearly financial report

We confirm that to the best of our knowledge:

- The condensed set of financial statements has been prepared in accordance with IAS 34 
"Interim Financial Reporting" as adopted by the EU:

- The interim management report includes a fair review of the information required by:

(a) DTR 4.2.7R of the "Disclosure and Transparency Rules", being an indication of important 
events that have occurred during the first six months of the financial year and their impact 
on the condensed set of financial statements; and a description of the principal risks and 
uncertainties for the remaining six months of the year; and

(b) DTR 4.2.8R of the "Disclosure and Transparency Rules", being related party transactions 
that have taken place in the first six months of the current financial year and that have 
materially affected the financial position of performance of the entity during that period; 
and any changes in the related party transactions described in the last annual report that 
could do so.


Signed on behalf of the Board

Katherine Garrett-Cox             Lesley Knox
Chief Executive                   Chairman

30 September 2008



Consolidated Income Statement (unaudited)
For the period ended 31 July 2008


                                 6 months to                 6 months to                               Year to
                                31 July 2008                31 July 2007                       31 January 2008
                                                                                                     (audited)

£000
                    Note   Revenue   Capital     Total  Revenue  Capital    Total  Revenue   Capital     Total
 
Revenue
Deposit interest             8,614         -     8,614    6,905        -    6,905   14,184         -    14,184
Dividend income             51,889         -    51,889   42,899        -   42,899   73,035         -    73,035
Mineral rights income          932         -       932      929        -      929    1,633         -     1,633
Rental income                2,189         -     2,189    1,748        -    1,748    4,016         -     4,016
 
Gains and losses on
investments
Loss on fair value               -   (1,799)   (1,799)        - (32,241) (32,241)        -   (2,255)   (2,255)
designated investments
held
(Loss)/Profit on fair            - (121,105) (121,105)        -  113,781  113,781        - (116,634) (116,634)
value designated
investments realised
 
Loss on investment               -  (15,645)  (15,645)        -    (222)    (222)        -  (11,820)  (11,820)
property held
Other operating income       5,161         -     5,161    4,259        -    4,259    9,331         -     9,331
 
Total revenue               68,785 (138,549)  (69,764)   56,740   81,318  138,058  102,199 (130,709)  (28,510)
 
Administrative expenses   (18,850)     (586)  (19,436) (19,319)    (871) (20,190) (38,114)   (1,234)  (39,348)
Finance costs           3  (2,720)   (2,019)   (4,739)  (1,883)        -  (1,883)  (5,727)   (2,681)   (8,408)
Foreign exchange (losses)        -     (910)     (910)        -      994      994       28     1,786     1,814
/gains
                               ---       ---       ---      ---      ---      ---      ---       ---       ---
Profit/(loss) before tax    47,215 (142,064)  (94,849)   35,538   81,441  116,979   58,386 (132,838)  (74,452)
Tax                        (5,421)       560   (4,861)  (4,129)       85  (4,044)  (3,052)       274   (2,778)
                               ---       ---       ---      ---      ---      ---      ---       ---       ---
Profit/(loss) for the       41,794 (141,504)  (99,710)   31,409   81,526  112,935   55,334 (132,564)  (77,230)
period
                               ===       ===       ===      ===      ===      ===      ===       ===       ===
Attributable to:
Minority interest               25     (734)     (709)        -        -        -     (10)     (658)     (668)
Equity holders of the       
parent                      41,769 (140,770)  (99,001)   31,409   81,526  112,935   55,344 (131,906)  (76,562)

                               ---       ---       ---      ---      ---      ---      ---       ---       ---
                            41,794 (141,504)  (99,710)   31,409   81,526  112,935   55,334 (132,564)  (77,230)
                               ===       ===       ===      ===      ===      ===      ===       ===       ===

Earnings per share from
continuing operations
attributable to equity
holders of the parent
Basic (p per share)     5     6.23   (21.00)   (14.77)     4.68    12.14    16.82     8.25   (19.65)   (11.40)
Diluted (p per share)   5     6.22   (21.00)   (14.78)     4.67    12.13    16.80     8.24   (19.65)   (11.41)




Consolidated statement of recognised income and expense


                                 6 months to 31            6 months to 31                         Year to 31
                                      July 2008                 July 2007                       January 2008
                                                                                                   (audited)

£000
                         Note Revenue   Capital     Total Revenue Capital   Total Revenue   Capital    Total
 
Income and expenses
recognised directly in
equity:
Defined benefit plan
actuarial (losses)/gains    6       -   (3,339)   (3,339)       -   1,539   1,539       -     1,404    1,404
Retirement benefit
obligations deferred tax    6       -       925       925       -   (336)   (336)       -     (399)    (399)
Profit/(loss) for the          41,794 (141,504)  (99,710)  31,409  81,526 112,935  55,334 (132,564) (77,230)
period
                                  ---       ---       ---     ---     ---     ---     ---       ---      ---
Total recognised income
and expense for the            41,794 (143,918) (102,124)  31,409  82,729 114,138  55,334 (131,559) (76,225)
period
 
Attributable to:
Minority interest                  25     (734)     (709)       -       -       -    (10)     (658)    (668)
Equity holders of the          41,769 (143,184) (101,415)  31,409  82,729 114,138  55,344 (130,901) (75,557)
parent
                                  ---       ---       ---     ---     ---     ---     ---       ---      ---

                               41,794 (143,918) (102,124)  31,409  82,729 114,138  55,334  (131,559)(76,225)



Consolidated Balance Sheet (unaudited)

As at 31 July 2008
                                   Note    31 July    31 July 31 January
                                              2008       2007       2008
                                                               (audited)
 
£000

Non-current assets
Held as fair value investments           2,191,391  2,721,072  2,729,397
Investment property                         64,455     91,190     80,100
Property, plant and equipment:
Office premises                              6,718        900      3,884
Other fixed assets                              57         51         36
Intangible assets                           15,761     14,659     16,763
Retirement benefit surplus            6          -      1,900      1,617
Deferred tax assets                              -        944          -
                                              ----       ----       ----
                                         2,278,382  2,830,716  2,831,797
Current assets
Other receivables                           31,585     46,503     48,171
Withholding tax debtor                       1,103      1,017      1,013
Corporation tax debtor                         500          -        875
Cash and cash equivalents                  559,204    321,243    227,653
                                              ----       ----       ----
                                           592,392    368,763    277,712
  
Total assets                             2,870,774  3,199,479  3,109,509
 
Current liabilities
Other payables                           (236,676)  (269,702)  (236,796)
Current tax liabilities                    (1,246)    (1,214)          -
Bank overdrafts and loans                 (50,000)          -  (159,000)
                                              ----       ----       ----
                                         (287,922)  (270,916)  (395,796)
 
Total assets less current                2,582,852  2,928,563  2,713,713
liabilities
 
Non-current liabilities
Deferred tax liabilities                   (1,501)      (570)    (1,546)
Retirement benefit obligations        6    (1,686)          -          -
                                              ----       ----       ----
Net assets                               2,579,665  2,927,993  2,712,167
 
Equity
Share capital                               16,798     16,798     16,798
Capital reserves                         1,820,368  2,179,478  1,966,300
Merger reserve                             645,335    645,335    645,335
Revaluation reserve                            608        608        608
Capital redemption reserve                   2,200      2,200      2,200
Revenue reserves                            87,071     75,053     73,550
                                              ----       ----       ---- 
Equity attributable to equity            2,572,380  2,919,472  2,704,791
holders of the parent
 
Minority interest                            7,285      8,521      7,376
 
Total equity                             2,579,665  2,927,993  2,712,167
 
Net Asset Value per ordinary share
attributable to equity holders of
the parent
Basic (p per share)                   7      383.9      435.2      403.2
Diluted (p per share)                 7      382.8      434.5      402.6




Consolidated Cash Flow (unaudited)
For the period ended 31 July 2008

                                       6 months to  6 months to   Year to 31
                                      31 July 2008 31 July 2007 January 2008
                                                                   (audited)
£000

Cash Flows from operating activities
(Loss)/Profit before tax                  (94,849)      116,979     (74,452)
Adjustments for:
Losses/(gains) on investments              138,549     (81,318)      130,709
Foreign exchange losses/(gains)                910        (994)      (1,814)
Scrip dividends                              (541)        (300)        (311)
Depreciation                                    27           13           45
Amortisation of intangibles                  1,335        1,946        1,562
Share based payment expense                    459          365          885
Interest payable pay                         4,284        1,457        6,572
                                              ----         ----         ----
Operating cash flows before movements       50,174       38,148       63,196
in working capital
 
Increase in amounts due to depositors       20,079       36,463       50,526
(Increase)/decrease in receivables         (10,003)    (15,638)          358
(Decrease)/increase in payables            (4,295)       76,573       10,613
                                              ----         ----         ----
Net cash from operating activities
before income taxes
                                            55,955      135,546      124,693
 
Taxes paid                                 (2,484)        (522)      (3,594)
                                              ----         ----         ----
Net cash inflow from operating              53,471      135,024      121,099
activities
 
Cash flows from investing activities
Proceeds on disposal of fair value       1,062,185      594,254    1,382,985
through profit and loss investments
Purchases of fair value through          (635,860)    (694,644)  (1,690,930)
profit and loss investments
Purchase of investment properties                -     (24,045)     (24,775)
Purchase of property, plant and               (48)         (66)         (49)
equipment
Purchase of intangible assets                (333)      (1,433)        (570)
Purchase in respect of new head            (2,834)            -      (2,984)
office
                                              ----         ----         ----
Net cash inflow/(outflow) from             423,110    (125,934)    (336,323)
investing activities
 
Cash flows from financing activities
Dividends paid - Equity                   (28,159)     (25,844)     (51,334)
Purchase of own shares                     (2,587)      (3,640)      (3,640)
New bank loans raised                            -            -      159,000
Repayment of borrowing                   (109,000)      (5,188)      (5,188)
Minority interest investment in               (90)        5,905        2,226
PATIF*
Interest payable                           (4,284)      (1,457)      (6,572)
                                              ----         ----         ----
Net cash (outflow)/inflow from           (144,120)     (30,224)       94,492
financing activities
 
Net increase/(decrease) in cash            332,461     (21,134)    (120,732)
and cash equivalents
 
Cash and cash equivalents at               227,653      341,383      346,571
beginning of period
 
Effect of foreign exchange rate              (910)          994        1,814
changes
                                              ----         ----         ----
Cash and cash equivalents at end           559,204      321,243      227,653
of period

* Premier Alliance Trust Investment Funds





Notes to the Financial Statements


1 General Information

The information for the period ended 31 July 2008 does not constitute statutory accounts 
as defined in section 240 of the Companies Act 1985. A copy of the statutory accounts for 
the year ended 31 January 2008 has been delivered to the Registrar of Companies. The auditors' 
report on those accounts was not qualified and did not contain statements under section 237(2) 
or (3) of the Companies Act 1985.

The interim results are unaudited. They should not be taken as a guide to the full year and 
do not constitute the statutory accounts.


2 Accounting Policies

The financial statements have been prepared using accounting policies consistent with International 
Financial Reporting Standards (IFRS) as adopted for use in the EU and in accordance with IAS 34 
`Interim Financial Reporting'.

Except for the new accounting policy on derivatives detailed below, the same accounting policies, 
presentations and methods of computation are followed in these financial statements as are 
applied in the Group's latest annual audited financial statements. No material changes in 
accounting policy are anticipated in the forthcoming financial statements for the year ended 
31 January 2009.

Gains and Losses on Investments

The Institute of Chartered Accountants in England and Wales (`ICAEW') in its technical guidance 
TECH01/08 states that profit or loss arising out of a change in fair value of assets should 
be considered to be realised where the change can be readily converted to cash. Investments 
listed on a recognised stock exchange are generally regarded as readily convertible into cash 
and therefore the income statement for the six months to 31 July 2008 and the year to 31 January 
2008 reflect this. However this guidance was not issued until February 2008 and therefore the 
comparatives for the six months to 31 July 2007 do not reflect this guidance and have not been 
restated.

Derivatives

Derivatives are recognised initially at cost and subsequent to initial recognition are stated 
at fair value. Changes in the fair value of derivatives are recognised in the income statement 
as they arise. The Group does not hold or issue derivatives for trading purposes.

Segmental Analysis

No segmental analysis is provided as the requirements provided under IAS14/IFRS8 have not been 
met and the directors consider that the identified operating segments are immaterial in relation 
to the results of the group as a whole.


3 Finance Costs

                  6 months to 31        6 months to 31            Year to 31
                       July 2008             July 2007          January 2008 

£000

           Revenue Capital Total Revenue Capital Total Revenue Capital Total
Interest
Payable
Payable to   1,710       - 1,710   1,883       - 1,883   4,365       - 4,365
depositors
Bank loans   1,010   2,019 3,029       -       -     -   1,362   2,681 4,043
and
overdrafts
              ----    ----  ----    ----    ----  ----    ----    ----  ----
Total        2,720   2,019 4,739   1,883       - 1,883   5,727   2,681 8,408
finance
costs


4 Dividends
                                       6 months to  6 months to   Year to 31
                                           31 July      31 July      January
                                              2008         2007         2008
 
£000
 
Third interim dividend for the year              -       13,099       13,099
ended 31 January 2007 of 1.95p per share
 
First interim dividend for the year              -       12,745       12,745
ended 31 January 2008 of 1.90p per share
 
Second interim dividend for the year             -            -       12,745
ended 31 January 2008 of 1.90p per share

Third interim dividend for the year              -            -       12,745
ended 31 January 2008 of 1.90p per share
 
Fourth interim dividend for the year        14,758            -            -
ended 31 January 2008 of 2.20p per share
 
First interim dividend for the year         13,401            -            -
ended 31 January 2009 of 2.00p per share


5 Earnings per share

From continuing operations

The calculation of the basic and diluted earnings per share is based on the following data:


                                    6 months to              6 months to                 Year to 31
                                   31 July 2008             31 July 2007               January 2008

                     Revenue   Capital    Total Revenue Capital    Total Revenue   Capital    Total
Ordinary shares
Earnings for the
purpose of basic
earnings per share
being net profit/
(loss)attributable
to equity holders of
the parent (£000)     41,769 (140,770) (99,001)  31,409  81,526  112,935  55,344 (131,906) (76,562)

Number of shares
Weighted average
number of ordinary
shares for the purposes
of basic earnings per
share
                                    670,223,550              671,434,022                671,113,244
Weighted average number
of ordinary shares for
the purposes of diluted
earnings per share                  671,909,760              671,909,760                671,909,760


The weighted average number of ordinary shares is arrived at by taking account of the 1,856,020 
(1,108,624) ordinary shares acquired by the Trustee of the Employee Benefit Trust with funds 
provided by the Company.

IAS 33.41 requires that shares should only be treated as dilutive if they decrease earnings per 
share or increase the loss per share.  The earnings/(loss) per share figures on the income 
statement reflect this.


6 Pension Schemes

The Group sponsors two pension arrangements.

The Alliance Trust Companies' Pension Fund (`the Scheme') is a funded defined benefit pension 
scheme which is now closed to new entrants. Members continue to accrue benefits under the Scheme.

Employees who joined the Group pursuant to an offer made after 1 March 2005 are not entitled 
to join the Scheme but are entitled to receive contributions into their own Self Invested Personal 
Pension (`SIPP') provided by Alliance Trust Savings Limited.

Valuation and Contributions

The last full actuarial valuation of the Scheme was carried out by a qualified independent actuary 
as at 1 April 2006 although for the purpose of these calculations the results have been updated 
on an approximate basis to 31 July 2008. Valuations are on the projected unit credit method.

The contributions made by the participating employer over the six months to 31 July 2008 were 
£1,020,000 (31 July 2007 £1,175,000).

These comprise the amount expected to be payable in the year to 31 January 2009. The actuarial 
loss made in the period and recognised in the statement of recognised income and expense (`SORIE') 
was £2,414,000 (31 July 2007 actuarial gain of £1,203,000)

Certain actuarial assumptions have been used to arrive at the retirement benefit deficit of £1.7m 
as at 31 July 2008 (31 July 2007 surplus of £1.9m). These are set out below:
 
                                       31 July 2008 31 July 2007 31 January 2008
                                        % per annum  % per annum  % per annum
 
Inflation                                      3.90         3.50         3.35
Salary increases                               4.90         4.50         4.35
Rate of discount                               6.00         5.75         6.00
Allowance for pension in payment               3.90         3.50         3.35
Increases of RPI or 5% p.a. if less
Allowance for revaluation of deferred          3.90         3.50         3.35
pensions of RPI or 5% p.a. if less


7 Net Asset Value per Ordinary Share

The calculation of the net asset value is based on the following:
 
                                            31 July     31 July  31 January
                                               2008        2007        2008
 
Equity shareholder funds (£000)           2,572,380   2,919,472   2,704,791
Number of share at period end - Basic   670,053,740 670,801,136 670,801,136
Number of shares at period end -        671,909,760 671,909,760 671,909,760
Diluted


The number of ordinary shares has been reduced by 1,856,020 (1,108,624 at 31 July 2007 
and 31 January 2008) ordinary shares held by the Trustee of the Employee Benefit Trust in 
order to arrive at the basic figures above.


8 Related Party Transactions

Transactions between the Company and its subsidiaries, which are related parties, are 
eliminated on consolidation.

Entities within the group may purchase goods or services for other entities within the group 
and recharge these costs directly to the appropriate entity that the costs relate to.

As at 1 February 2008 primary responsibility for the payment of goods and services on behalf 
of the group was transferred from Alliance Trust Finance Ltd to Alliance Trust Services Ltd.

During the period the following amounts were reimbursed/(repaid):

 
                          6 months to   6 months to     Year to
                         31 July 2008  31 July 2007  31 January
Alliance Trust Finance                                     2008                                                             
 
£000
 
Paid by Alliance Trust             5         2,830        5,793
Paid to Alliance Trust          (23)            -            -
                                ----         ----         ----
                                (18)         2,830        5,793
 
Paid by Alliance Trust            85         4,822       10,549
Savings Limited
 
Paid to Alliance Trust          (36)          (75)         (75)
Savings Limited
                                ----          ----         ----
                                  49         4,747       10,474
 

Alliance Trust Services
 
£000
                      
Paid by Alliance Trust         5,281         2,423        4,289
Paid to Alliance Trust       (3,793)       (2,477)      (7,050)
                                ----          ----         ----
                               1,488          (54)      (2,761)

 
                      
Paid by Alliance Trust         6,445         3,602        7,162
Savings Limited
                      
Paid to Alliance Trust         (128)          (21)        (101) 
Savings Limited
                                ----          ----         ----
                               6,317         3,581        7,061

 
Transactions with key management personnel

For the purposes of IAS 24 `Related Party Disclosures', key management personnel comprise 
the members of the Chief Executive's Group (the executive directors plus the Chief Operating 
Officer) plus the non executive directors of the Company.  Their remuneration and other 
compensation is summarised below
 

£000
 
Total emoluments                1,062    1,845    2,793
Post retirement benefits          110      116      248
Equity compensation benefits      361      306      612


9 Intangible Assets - Goodwill Impairment Testing

Goodwill has arisen on the acquisition of certain businesses and assets. It is subject to 
an annual impairment review. Where this indicates that the carrying value is not recoverable 
it is written down through the income statement. No review has been carried out at the interim 
date as the review is an annual one and therefore there is no impairment loss for the period 
(2007 Nil).


10 Capital Expenditure Commitments

Venture Capital Fund Commitments

On 31 July 2008 the Company had undrawn venture capital fund commitments totalling £76.9m 
(£71.3m at 31 January 2008).


11 Share Based Payments

The group operates three share based payment schemes. Full details of these schemes are disclosed 
in the 2008 annual report and financial statements and the basis of measuring fair value is 
consistent with that disclosed therein.

In the period to 31 July 2008 participating employees applied a proportion of their annual cash 
bonuses for the year ended 31 January 2008 to purchase 197,247 (103,711) Company shares at a price 
of £3.51 (£3.8625) per share. Matching awards of up to 376,672 (197,928) shares, and performance 
awards of up to 958,559 (1,015,637) shares were granted.

Matching awards and performance awards made during the period were valued at £444,232 (£266,807) 
and £1,048,086 (£1,233,659) respectively. The fair value of the awards was calculated using a 
binomial methodology. The assumptions used were a share price of £3.51 (£3.8625), share price 
volatility of 12.8% (12.3%) based on 3 year volatility to 1 February 2008, a dividend yield of 
2.2% (2.03%), a risk free rate of return of 4.25% (5%), and growth in RPI of 2.6% (3%) per annum.

The cumulative charge to the income statement during the period for the cost of the awards referred 
to above was £179,824 (£236,181) for the Company and £459,090 (£364,713) for the Group. Per IFRS 2 
the costs of matching awards for each plan are expensed over the three year performance period.

These costs are adjusted if certain vesting conditions are not met, for example if a participant 
leaves before the end of the three year vesting period.


12 Principal Risks and Uncertainties

As an investment trust the Company invests in both quoted and unquoted equities, fixed income 
securities, its subsidiary businesses, other asset classes and financial instruments for the long 
term in order to achieve its investment objectives. Its principal risks are therefore market risk 
(comprising currency risk, interest rate risk and other price risk), liquidity risk and credit risk.

Other risks faced by the Company include regulatory, reputational, operational and financial risks. 
These risks, and the way in which they are managed, are described in more detail within the Business 
Review in the Company's Annual Report and Accounts for the year ended 31 January 2008. The nature of 
the Company's principal risks and uncertainties has not changed materially since the date of that report.


Note on Audit

This half-yearly financial report has not been audited or reviewed by our auditors pursuant to the 
Auditing Practice Board guidance on Review of Interim Financial Information.


 END