Portfolio Update

BLACKROCK SMALLER COMPANIES TRUST plc
All information is at 31 May 2010 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             -8.0%      5.8%    42.8%     -18.5%      51.1%    
Share price                 -9.5%     10.0%    38.0%     -22.3%      54.7%    
HGSC ex Inv Trust + AIM*    -7.3%      1.9%    28.6%     -31.5%      -0.2%    

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):           397.03p           
Net asset value Capital only (debt at fair value):          392.77p           
Net asset value incl. Income (debt at par value):           400.47p**         
Net asset value incl. Income (debt at fair value):          396.21p**         
Share price:                                                323.00p           
Discount to Capital only NAV (debt at par value):           18.6%             
Discount to Capital only NAV (debt at fair value):          17.8%             
Net yield:                                                  1.5%              
Total assets:                                               £214.4m^          
Gearing incl. Income:                                       11.5%             
Ordinary shares in issue:                                   47,879,792^^      

**includes net revenue of 3.43p.
^includes current year revenue.
^^excludes 2,113,731 shares held in treasury.
 

Ten Largest Sector                                                         
Weightings                                                % of Total Assets
                                                                           
Industrial Metals & Mining                                             11.0
Software & Computer Services                                           10.5
Financial Services                                                      8.6
Oil & Gas Producers                                                     8.6
Electronic & Electrical Equipment                                       7.3
Support Services                                                        6.8
Industrial Engineering                                                  6.6
Pharmaceuticals & Biotechnology                                         5.5
Technology Hardware & Equipment                                         5.0
Media                                                                   4.7
                                                                      -----
Total                                                                  74.6
                                                                       ====

Ten Largest Equity Investments (in alphabetical order)
Company

Abcam Group
Aveva Group
Brewin Dolphin Holdings
Domino Printing Sciences
Fidessa group
ITE Group
Rotork
Spirax-Sarco Engineering
Victrex
Western Coal

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

May was a poor month for stockmarkets around the world, and the Company
performed poorly in absolute and relative terms, with the NAV (on a capital
only basis) down 8.0%, behind the benchmark which was down 7.3%. The FTSE 100
Share Index fell by 6.6%.

The main reason for underperformance was gearing. The Company has remained 10%
to 12% geared for some time, and with the benchmark down 7.3%, gearing
accounted for 0.8% of underperformance.

From a stock point of view our holdings in Abcam and BSS Group contributed
strongly to relative performance, whereas our holding in BATM Advanced
Communications disappointed. Abcam shares performed well although there was no
newsflow during the month; we see this as a very defensive holding which has
experienced strong growth which we expect to continue. BSS Group announced a
bid approach from Travis Perkins; the combination of the two companies would
undoubtedly make a good fit. BATM announced that trading in their telecoms
division was well behind expectations with one of their key customers itself
losing share mainly, we believe, to Chinese competitors. BATM still see
considerable potential for their telecoms products especially in the US, but
demand is unlikely to recover quickly. Their medical division is making better
progress, and the company is financially very strong. However, overall, this
was a very disappointing update.

Activity during the month was limited. We did trim a few holdings, and we took
small new holdings in Blinkx and Faroe Petroleum; we had positive meetings with
management of these companies during the month. Blinkx believe they are the
world's largest and most advanced video search engine, with an index of over 35
million hours of searchable video. Revenues are running well ahead of previous
market expectations. Faroe Petroleum is an oil and gas company focused on
exploration and appraisal drilling in the Atlantic Margin (Faroe Islands and UK
west of Shetlands), the North Sea and Norway. The company has a very active
drilling program and have had recent drilling successes.

We have seen a continuation of the high volatility which began late in April.
There continue to be a number of areas of uncertainty, the most immediate ones
seem to be handling the excessive borrowing of some Southern European
countries, worries about economic overheating in China and whether a slowdown
can be managed effectively, worries about North Korea and its relationships
with its neighbours, the implications of the imposition of a mining tax by the
Australian government, and the effect of cuts in public spending by the new UK
government. Some of these concerns are now beginning to recede.

We take comfort from the data which shows that global GDP growth is above 3%,
led by Asia Pacific, Emerging Markets and North America. Our portfolio is
positioned to benefit from strength in these regions; we are underweight most
areas of UK consumer and UK government spending. Many of our holdings are
trading well in the current climate; holdings such as Spectris and Renishaw
have seen good earnings upgrades in May and we are seeing a continuation of bid
activity, most recently for BSS Group.

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).

2 July 2010