Portfolio Update

BLACKROCK SMALLER COMPANIES TRUST plc

All information is at 31 January 2011 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             2.5%     15.6%      62.1%      60.0%      74.8%     
Share price                 6.4%     24.0%      78.1%      71.9%      77.9%     
HGSC ex Inv Trust + AIM*    0.9%      9.9%      28.5%      11.7%       3.5%      

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 the five year period the above index
has been blended to reflect this.

At month end                                                                  
Net asset value Capital only (debt at par value):           607.60p           
Net asset value Capital only (debt at fair value):          603.37p           
Net asset value incl. Income (debt at par value):           613.38p**         
Net asset value incl. Income (debt at fair value):          609.14p**         
Share price:                                                531.50p           
Discount to Capital only NAV (debt at par value):           12.5%             
Discount to Capital only NAV (debt at fair value):          11.9%             
Net yield:                                                  1.1%              
Total assets:                                               £323.7m^          
Gearing incl. Income:                                       9.9%              
Ordinary shares in issue:                                   47,879,792^^      

**includes net revenue of 5.78p.
^includes current year revenue.
^^excludes 2,113,731 shares held in treasury.

Ten Largest Sector                                                         
Weightings                                      % of Total Assets
                                                                           
Software & Computer Services                                  9.6
Support Services                                              9.1
Industrial Metals & Mining                                    8.9
Oil & Gas Producers                                           8.8
Financial Services                                            8.7
Electronic & Electrical Equipment                             8.1
Media                                                         6.4
Industrial Engineering                                        5.9
Pharmaceuticals & Biotechnology                               5.2
Chemicals                                                     4.1
                                                             ----
Total                                                        74.8
                                                             ====
 
Ten Largest Equity Investments (in alphabetical order)

Company

Abcam Group
Aveva Group
City of London Investment Group
Cove Energy
Domino Printing Sciences
Fidessa group
Hutchison China Meditech
IQE
ITE Group
Renishaw

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

During January the Company's NAV per share rose by 2.5% on a capital only
basis, whilst the benchmark index increased by 0.9%. The FTSE 100 Index fell by
0.6%.

The main positive contributors to our outperformance in the month, relative to
the Company's benchmark, were our holdings in Mecom and Renishaw. Mecom
announced a trading update which highlighted its strong cash generation, even
though advertising revenues have yet to pick up. Renishaw produced very strong
interim results driven by high levels of demand from most parts of the world,
but especially China. Demand is for its metrology probes and related software
which is enabling customers to carry out measurements to far higher levels of
accuracy than possible using competitive equipment. Renishaw has continued to
invest heavily in R & D and we expect other product ranges to contribute
meaningfully to profits within the near future.

There was no significant negative contributor to relative performance during
the month, in that no one holding detracted from relative performance by more
than 0.25%.

Outperformance was derived from both stock selection and sector allocation. The
main positive sector contributor was our large overweight position in the
electronics and electrical equipment sector. Interestingly, the largest
negative contributor was our overweight position in the industrial engineering
sector; the companies in this sector have very similar drivers to those in the
electronics and electrical equipment sector. The main reason for the
underperformance of the industrial engineering sector would appear to be the
poor share price performance of stocks such as Rotork, Spirax Sarco and
Spectris during January. All of these companies had market capitalisations too
large to retain membership of the Hoare Govett indices when rebalanced on 1
January. We suspect they have experienced a wave of benchmark related selling,
but we remain confident that all continue to trade well; we have a holding in
each.

We sold the balance of our holding in Biocompatibles following the bid from
BTG. We also sold our holding in Hardy Underwriting on the grounds of likely
increasing claims for the sector and weak rate increases on renewal. We added
new holdings in Mulberry and Collins Stewart. We held meetings with the chief
executives of both companies before taking holdings. It is clear that demand
for Mulberry's upmarket leather handbags remains very strong, driven by demand
from wealthy Chinese and other overseas buyers. Whilst the stock is highly
valued we believe its brand, aimed at the luxury end of the international
market, is more likely than many to be enduring. Collins Stewart is a mix of
businesses. We believe its wealth management business has good long term growth
potential, its Hawkpoint corporate finance business could soon enter more
encouraging times for mergers and acquisitions at the smaller end of the market
and its broking business is gaining market share. The rating of the shares is
also modest.


16 February 2011

ENDS

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