Portfolio Update

BLACKROCK SMALLER COMPANIES TRUST plc

All information is at 31 July 2009 and unaudited.

Performance at month end is calculated on a capital only basis

                             One     Three       One     Three     Five      
                           Month    Months      Year     Years    Years     
                                                                              
Net asset value             6.5%     10.7%    -21.9%    -15.0%    36.6%     
Share price                 1.1%      5.5%    -24.8%    -21.5%    30.0%     
HGSC ex Inv Trust + AIM*    6.4%      9.7%    -15.4%    -30.1%    -8.2%   

Sources: BlackRock and Datastream

*With effect from 1 September 2007 the Hoare Govett Smaller Companies plus AIM
(ex Investment Companies) Index replaced the FTSE SmallCap Index (ex Investment
Companies) as the Company's benchmark. For three year and five year periods the
above index has been blended to reflect this.

At month end                                                                  
                                                                              
Net asset value Capital only (debt at par value):               299.89p           
Net asset value Capital only (debt at fair value):              294.40p           
Net asset value incl. Income (debt at par value):               303.84p**         
Net asset value incl. Income (debt at fair value):              298.35p**         
Share price:                                                    235.00p           
Discount to Capital only NAV (debt at par value):                21.63%            
Discount to Capital only NAV (debt at fair value):               20.17%            
Net yield:                                                        2.15%             
Total assets:                                                   £165.6m^           
Gearing incl. income:                                             13.1%             
Ordinary shares in issue:                                   48,194,792^^      

**includes net revenue of 3.95p.
^includes current year revenue.
^^excludes 1,798,731 shares held in treasury.

Ten Largest Sector                                                             
Weightings                                              % of Total Assets
                                                                               
Software & Computer Services                                         11.4
Financial Services                                                    9.3
Oil & Gas Producers                                                   9.0
Support Services                                                      8.3
Industrial Metals & Mining                                            6.9
Industrial Engineering                                                5.1
Travel & Leisure                                                      4.4
General Retailers                                                     4.2
Technology Hardware & Equipment                                       3.8
Pharmaceuticals & Biotechnology                                       3.8
                                                                     ----
Total                                                                66.2
                                                                     ====

Ten Largest Equity Investments (in alphabetical order)                         
                                                                               
Company                                                                        
                                                                               
Abcam                                                                          
Aveva Group                                                                    
Brewin Dolphin Holdings                                                        
City of London Investment Group                                                
Dechra Pharmaceuticals                                                         
Domino Printing Sciences                                                       
Emerald Energy                                                                 
Fidessa Group                                                                  
Rathbone Brothers                                                              
Rensburg Sheppards                                                             

Commenting on the markets, Mike Prentis, representing the Investment Manager
noted:

During July the NAV increased by 6.5% on a capital only basis; this was
marginally ahead of the benchmark which rose by 6.4%. The FTSE 100 rose by
8.5%.

The main contributors to relative outperformance were holdings in Emerald
Energy and Western Canadian Coal. Emerald Energy announced that it had received
a bid approach; in August, Sinochem announced a cash offer. Western Canadian
Coal completed its all share merger with Cambrian Mining, in which we had a
holding. Western Canadian Coal shares have been strong before and post the
merger; it is now a well financed, profitable coal producer with significant
reserves mainly in North America.

Relative performance was impacted by a poor contribution from Rathbone Brothers
and Phorm. Rathbones reported interims in late July which showed that it is
getting far less interest margin on customer deposits than last year; this
trend will continue whilst interest rates remain low. We see the Rathbones
brand as being strong, helping to generate reasonable organic funds growth, and
the shares are now trading at trough, or close to trough, earnings, with a
strong balance sheet supported by a good yield. Phorm is a small holding and an
interesting software company with potentially considerable upside. However, its
key trial customer has been BT, and BT elected to discontinue the trial during
July. Trials are going on elsewhere in the world, but the BT news was
disappointing and the shares fell sharply.

Holdings in Mouchel, Debenhams and DSGI were sold. Mouchel had failed to win
any of the largest contracts it has been tendering for. Whilst it has a large
order book of contracted business, it also has a high margin consultancy
business where visibility is limited; this seems to have seen a fall off in
demand, much of which comes from UK Government. We do not see this situation
improving in the near term. We remain cautious about UK consumer spending given
the many pressures on UK individuals. Debenhams and DSGI had not been high
conviction holdings.

We took new holdings in Hutchison China Meditech ("Chi-Med") and IQE. Chi-Med
has several activities the main one of which is the development, manufacture
and sale of traditional Chinese medicines which are sold directly into the
Chinese market through a sales and distribution workforce across China of about
2,300 people. The Chinese Government is keen to improve healthcare and Chi-Med,
which is related to the Hutchison Whampoa group, is well placed to benefit.
Revenues are growing strongly and the company is well financed and valued at
less than 0.5 times sales on an EV basis. IQE is a leading global manufacturer
of compound semiconductors, most of which are used in mobile phones. The
growing use of smartphones is a big positive for IQE since smartphones use much
more compound semiconductors than ordinary mobile phones. Other vertical
markets also offer good potential for IQE.

Latest information is available by typing www.blackrock.co.uk/its on the
internet, "BLRKINDEX" on Reuters, "BLRK" on Bloomberg or "8800" on Topic 3 (ICV
terminal).

24 August 2009