Interim Results

ABERFORTH SMALLER COMPANIES TRUST plc

INTERIM RESULTS

For the Six Months to 30 June 2003


FEATURES

          Fully Diluted Net Asset Value Total Return                     +18.5%

          Benchmark Index Total Return                                   +19.2%

          Increase in Interim Dividend per Ordinary Share                +6.1%


Aberforth Smaller Companies Trust plc (ASCoT) invests only in small UK quoted
companies and is managed by Aberforth Partners.


CHAIRMAN'S STATEMENT TO SHAREHOLDERS

RESULTS REVIEW

For the six months to 30 June 2003 ASCoT achieved a total return of 18.5%, which
compares  with the total return of 19.2% from the Hoare Govett Smaller Companies
Index  (Excluding  Investment Companies), your Company's  investment  benchmark.
Larger companies, as represented by the FTSE All-Share Index, registered a total
return  of  6.3%.   ASCoT has therefore slightly underperformed  its  benchmark,
though  the  real feature of the period was the significant outperformance  from
smaller companies relative to their larger brethren.

Your Board is pleased to announce an increase in this year's interim dividend to
3.50p  per  share.  This represents a rise of 6.1% compared with the  equivalent
period  last  year.   This rate of increase reflects the robustness  of  ASCoT's
portfolio  in  difficult  economic times as well as  your  Board's  belief  that
dividend  yield  and  growth will continue to be of significance  to  investors'
total  return.   The  interim  dividend will be paid  on  5  September  2003  to
Shareholders on the register on 8 August 2003.

At  the  Annual  General  Meeting  held in February,  Shareholders  renewed  the
authority  for your Company to buy in up to 14.99% of its Ordinary  Shares.   No
shares  have yet been bought in under this authority, but your Board  would  not
hesitate to act should we believe it to be in Shareholders' best interests.

During  the  six month period, your Company was able to buy 40,000 Warrants  for
cancellation  at  a  price that modestly enhanced the fully  diluted  net  asset
value.   However,  of greater importance was the passing of the  final  exercise
date  for  the  Warrants of 31 March 2003.  The remaining 963,311 Warrants  were
exercised and the listing of the resulting Ordinary Shares took place on 9 April
2003.

With the expiry of its Warrants, ASCoT's capital structure is even simpler,  now
comprising  only  Ordinary  Shares.   Investment  trusts'  ability  to   enhance
shareholder  returns  by borrowing is one of their greatest strengths,  although
the  use  of  long term fixed rate debt has proved a burden to  many  in  recent
times.   ASCoT  is not currently geared and has no long term debt.   A  flexible
£80m  debt  facility is, however, available and may be drawn  down  on  request.
This  or  similar  facilities have been used in the past  to  the  advantage  of
ASCoT's shareholders, and no doubt will be used again.

INVESTMENT BACKGROUND

The  recent  rally in stockmarkets around the world would appear  to  have  been
justified by a resolution of the Iraqi war, which has helped to lower the  price
of  oil, and by the efficient containment of SARS.  A remarkable feature of  the
rebound  has  been  the  concomitant development in the prices  of  other  asset
classes:  rising  equities  have been accompanied by  reinvigorated  commodities
prices,  narrowing  spreads  on  corporate debt  and  a  falling  dollar  -  all
potentially  indicative of inflation - but also by a continuation  in  the  bull
market for government bonds - hardly consistent with resurgent inflation.

These unusual price movements have fuelled a debate between those who worry that
the  Western  world  is following Japan into deflation and  those  who  identify
inflation as the true threat.  Those in the former camp point to the legacies of
the  equity  bubble  of the late 1990s - excess capacity and a  highly  indebted
private  sector risk - and to China's emergence as a major economy. The  US  has
responded by cutting interest rates to their lowest level for 45 years, together
with  tax cuts and greater public spending.  On top of these, ambiguous comments
about  the  commitment to "the strong dollar" have helped push the  US  currency
down  against  the  euro by 16% since 30 June 2002.  But, most  remarkably,  Fed
officials have expressed their confidence in "making sure it (deflation) doesn't
happen" through the use of so-called "unconventional measures".

Financial  markets  are entering uncharted waters, but such measures  appear  to
entail  the use of the printing press to create more money.  One mooted  tactic,
which gratifyingly goes some way to rationalise the unusual combination of asset
price  movements  in  recent  months, is for  the  Fed  to  suppress  yields  of
government  bonds  of  all maturities by buying them with  their  newly  printed
dollars.   To  date, "unconventional measures" have not been employed,  but  the
mere  suggestion appears to have driven financial markets to build in a  greater
likelihood  of reflation.  Such an outcome would probably prove more benign  for
equities than a slide into deflation.

Whether  through  luck or judgement, however, the spectre of deflation  is  much
less  frightening in the UK.  Inflation, as gauged by the RPIX,  is  running  at
around 3% and, thanks to government spending and low interest rates, the economy
is  forecast  to grow in nominal terms at least as quickly as the  US  and  more
quickly than the Eurozone in 2003. Sterling's weakness against the euro is  also
helpful  and may assist in addressing some of the imbalances in the UK  economy.
In  particular, it should be of more direct benefit than lower interest rates to
exporters  and those businesses with continental competitors: according  to  the
National  Statistics Office, the manufacturing sector's output managed  a  small
improvement  in  the  first  quarter  of 2003  after  having  fallen  for  eight
consecutive quarters.

The  key to the UK's relative resilience, however, remains the consumer.   There
are  signs,  though, that confidence is slipping and that house price  inflation
has  fallen sharply from the 26% rate reached at the end of 2002.  Against  this
background,  and with the global economic outlook murky, it is perhaps  as  well
that  the  government  has opted to maximise the country's fiscal  and  monetary
flexibility by deciding against EMU entry for the time being.

INVESTMENT PERFORMANCE

The  six  months to 30 June 2003 can be split into two distinct periods.   In  a
continuation of the trends that prevailed in the second half of 2002, the  first
two  and  a  half  months were in the grip of the bear market.  ASCoT  performed
relatively  well  in  this  period.   From mid March, however,  the  stockmarket
staged  a  strong  rally that was led by small companies.   ASCoT's  performance
lagged  in  this  recovery  phase, as the Managers  questioned  the  fundamental
justification for the revaluation of a number of businesses.

Corporate  activity  made  a minor contribution to ASCoT's  performance,  though
there  are  signs  that  confidence is returning.  Although  only  22  benchmark
companies were acquired in ASCoT's first half, against 53 deals in the whole  of
2002,  many more are in discussions or have actually received bids.  Clearly,  a
proportion  of  these approaches will fail, but there are grounds for  optimism:
large amounts of money in venture capital funds are waiting to be invested; in a
low  growth world, management teams may seek to add value through consolidation;
and, as is described below in greater detail, small UK companies appear to offer
good value.

The  companies  in  ASCoT's portfolio have, on the whole, coped  well  with  the
uncertain economic environment.  A useful means to assess this assertion  is  to
examine  their dividend payments.  The dividends announced by the 103  companies
in  the portfolio at 30 June 2003 were 6% higher than the corresponding payments
in  the  previous  year,  although it is should be  noted  that  ASCoT's  actual
receipts  vary from this since the portfolio is actively managed.   Of  the  103
businesses, 13 did not, as anticipated, pay a dividend; seven cuts were endured,
three of which were expected; and 23 companies reported unchanged dividends. The
remaining 60 raised their payouts.

With  inflation around 3%, this level of dividend growth is encouraging and,  in
the  absence  of robust growth in the economy at large, is due in  part  to  the
average  dividend cover of the portfolio, which at the end of June was the  same
as  that of the benchmark.  This is significant, given that over ASCoT's history
the  portfolio's cover has been on average 11% lower than that of the benchmark.
The  opportunity  to  construct  such a portfolio  has  been  presented  by  the
compression of the gap between the price earnings ratios of "value" and "growth"
stocks  that  has characterised the bear market.  This allowed the  Managers  to
make  selective  purchases of higher quality businesses whose  valuations  would
previously have been too demanding.







                                            30 June 2003             30 June 2002
Characteristics                           ASCoT     Benchmark      ASCoT    Benchmark
                                                                                                
Number of Companies                         103           827         96          915
Weighted Average Market Capitalisation  £309.0m       £334.0m    £317.6m      £355.4m
Price Earnings Ratio (Historic)           11.9x         13.4x      12.3x        14.3x
Net Dividend Yield (Historic)              3.4%          3.0%       3.0%         2.8%
Dividend Cover (Historic)                  2.5x          2.5x       2.7x         2.5x

INVESTMENT OUTLOOK

The threat of deflation, whether real or imagined, has profound implications for
both economies and financial markets.  For the Fed, the threat is very real.  It
has   responded  with  interest  rate  cuts  and,  more  recently,  talk   about
"unconventional  measures".  The truth is that words are a more powerful  weapon
than actual deployment of these measures: the trick is to build confidence among
consumers  and  businesses that deflation will not happen, so that  they  resume
spending  and  investment.   The  risk is that,  as  in  Japan,  loose  monetary
conditions  do  not  translate  into  greater  activity  in  the  real  economy.
Consumers  and businesses may, for example, consider it more rational to  reduce
their indebtedness than to spend.

Therefore, despite a prompt end to the Iraqi war, economic conditions  still  do
not  appear conducive to sustained growth in corporate profits, the sine qua non
of  successful equity investment.  Such doubts are reflected in the  actions  of
those  running  the  businesses.  Judging by the results  of  ASCoT's  portfolio
companies, management teams are doing a fine job in controlling costs.  They are
not,  though,  sufficiently  confident yet to invest:  their  focus  remains  on
optimising  cash  generation,  often by setting  capital  expenditure  at  under
depreciation.

The  Managers  do  not,  therefore, foresee an imminent return  to  double-digit
increases in earnings per share for the stockmarket as a whole.  It still  seems
appropriate  to think of real returns from equities of close to  the  5-7%  long
term  average.   They will, though, be prone to wild swings from year  to  year,
perhaps of the sort witnessed so far in 2003.

Dividend  yield  and dividend growth may therefore assume greater  significance.
From  the  point  of  view  of  investors in  small  UK  quoted  companies,  the
combination  of  a 3.0% yield and 2.5x dividend cover is encouraging.   Although
larger  companies, as gauged by the FTSE All-Share Index (excluding loss  makers
and  investment  companies), boast a higher yield of 3.5%, they  do  so  at  the
expense  of  a  lower  dividend cover at 1.7x and, therefore,  ceteris  paribus,
inferior dividend growth prospects.

Following this logic, ASCoT's portfolio would appear relatively well positioned.
It  is  diversified, with holdings in 103 companies, and generates a 3.4%  yield
without sacrificing dividend cover, which stands at 2.5x.  In constructing  this
portfolio, the Managers have applied the same principles of value investment  to
which  they  have  adhered  throughout  ASCoT's  life.   Such  consistency   has
inevitably  led to volatile relative performance, as the mood of the market  has
changed, but has, on the whole, resulted in respectable returns.

                                                               William Y. Hughes
                                                                        Chairman
                                                                    17 July 2003


The  Statement  of  Total Return, summary Balance Sheet and  summary  Cash  Flow
Statement are set out below:-


STATEMENT OF TOTAL RETURN
(Incorporating the Revenue Account1)
(unaudited)

                                          6 months to                               6 months to
                                         30 June 2003                               30 June 2002
                                Revenue       Capital          Total      Revenue        Capital          Total
                                  £'000         £'000          £'000        £'000          £'000          £'000
                                                                                                 
Realised (losses)/gains on sales      -       (1,260)        (1,260)            -          7,298          7,298
Unrealised gains                      -        47,623         47,623            -         10,187         10,187
                                -------       -------        -------      -------        -------        -------
Gains/(losses) on investments         -        46,363         46,363            -         17,485         17,485
Deemed cost of Warrants                                                                          
purchased for                         -          (50)           (50)            -              -              -
cancellation
Dividend income                   5,988             -          5,988        5,442            254          5,696
Interest income                     207             -            207          299              -            299
Other income                          9             -              9           48              -             48
Investment management fee         (475)         (792)        (1,267)        (580)          (967)        (1,547)
Other expenses                    (146)             -          (146)        (127)              -          (127)
                                -------       -------        -------      -------        -------       --------
Return on ordinary                                                                               
activities before tax             5,583        45,521         51,104        5,082         16,772         21,854
Tax on ordinary activities            -             -              -            -              -              -

                                -------       -------        -------      -------        -------        -------
Return attributable to                                                                           
  equity shareholders             5,583        45,521         51,104        5,082         16,772         21,854
Dividends in respect of        
  equity shares                 (2,969)             -        (2,969)      (2,767)              -        (2,767)
                                -------       -------        -------      -------        -------        -------
Transfer to reserves              2,614        45,521         48,135        2,315         16,772         19,087
                                =======       =======        =======      =======        =======        =======
Returns per Ordinary Share2:                                                                           
  Basic                           6.62p        53.97p         60.59p        6.07p         20.03p         26.10p
  Diluted                         6.59p        53.76p         60.35p        5.99p         19.76p         25.75p
                                                                                                 
Dividends per Ordinary Share      3.50p             -          3.50p        3.30p              -          3.30p


NOTES

1.   The revenue column of this statement is the profit and loss account of the Company. All revenue and capital
     items in the above statement derive from continuing  operations. No operations were acquired or discontinued
     in the period.

2.   The  calculations of revenue return per Ordinary Share are based on net revenue of £5,583,000 (30 June 2002
     - £5,082,000) and on Ordinary Shares of 84,339,740 (30 June 2002 - 83,741,322) in the case of basic returns
     and 84,677,027 (30 June 2002 - 84,864,791) in the case of diluted returns.

The  calculations of capital return per Ordinary Share are based on net capital gains of £45,521,000 (30 June 2002
- £16,772,000) and on Ordinary Shares of 84,339,740 (30 June 2002 - 83,741,322) in the case of basic returns and
84,677,027 (30 June 2002 - 83,741,322) in the case of diluted returns.


SUMMARY BALANCE SHEET
(unaudited)


                                                                 30 June        30 June    31 December
                                                                    2003           2002           2002
                                                                   £'000          £'000          £'000
                                                                                        
Securities officially listed on the London Stock Exchange        310,834        335,263        273,543
                                                                --------       --------       --------
                                                                                                     
Cash at bank                                                      14,332            612          6,555
Debtors                                                            5,233          2,315          1,024
Creditors                                                        (5,434)        (3,617)        (5,227)
                                                                --------       --------       --------
                                                                     
Net current assets/ (liabilities)                                 14,131          (690)          2,352
                                                                                        
                                                                --------       --------       --------
                                                                     
Total assets less liabilities                                    324,965        334,573        275,895
                                                                ========       ========       ========
                                                                                        
Capital and reserves: equity interests                                                  
  Called up share capital (Ordinary Shares)                          848            839            839
                                                                                        
Reserves:                                                                               
  Share premium account                                            2,043          1,089          1,090
  Special reserve                                                133,525        133,525        133,525
  Capital reserve - realised                                     149,471        144,040        151,600
  Capital reserve - unrealised                                    25,638         42,828       (21,985)
  Revenue reserve                                                 13,440         12,252         10,826
                                                                --------       --------       --------
                                                                    
                                                                 324,965        334,573        275,895
                                                                ========       ========       ========
                                                                                        
Net Asset Values:                                                                       
  per Ordinary Share (basic)                                      383.1p         399.0p         329.0p
  per Ordinary Share (fully diluted)                                 n/a         394.0p         326.3p
  per Ordinary Share (diluted - FRS 14)                              n/a         394.1p         326.3p



NOTES

As at 30 June 2003, the Company had 84,818,734 Ordinary Shares (30 June 2002 and 31 December 2002 - 83,855,423).
No warrants remain in issue (30 June  2002 - 1,434,811 and 31 December 2001 - 1,003,311) in issue.

In April 2003, as a result of holders exercising the subscription rights of their Warrants, 963,311 Ordinary Shares
of 1p were issued at 100p per share. During the six months to 30 June 2003, the Company purchased 40,000 Warrants for
cancellation at a total cost of £77,000.





SUMMARY CASH FLOW STATEMENT
(unaudited)

                                                      6 months to                       6 months to
                                                      30 June 2003                     30 June 2002
                                                      £'000            £'000            £'000           £'000
                                                                                               
Net cash inflow from operating activities                              3,802                            3,312
                                                                                               
Capital expenditure and financial investment                                                              
Payments to acquire investments                    (34,101)                          (61,962)  
Receipts from sales of investments                   42,390                            49,762  
                                                   --------                          --------  
Net cash inflow/(outflow) from capital                                                         
   expenditure and financial investment                                8,289                         (12,200)
                                                                     -------                         --------
                                                                      12,091                          (8,888)
                                                                                               
Equity dividends paid                                                (5,199)                          (4,934)
                                                                    --------                         --------
                                                                       6,892                         (13,822)
Financing                                                                                      
Issue of Ordinary Shares                                962                               224  
Warrants purchased for cancellation                    (77)                                 -  
                                                   --------                          --------  
                                                                                               
Net cash inflow from financing                                           885                              224
                                                                    --------                         --------
Increase/(decrease) in cash                                            7,777                         (13,598)
                                                                    ========                         ========


NOTES

1.   The foregoing do not comprise statutory accounts (as defined in section 240(5) of the Companies Act 1985)
     of the Company. The statutory accounts for the year to 31 December 2002, which contained an unqualified
     Report of the Auditors, have been lodged with the Registrar of Companies and did not contain a statement
     required under section 237(2) or (3) of the Companies Act 1985.

2.   The Interim Report is expected to be posted to shareholders on 21 July 2003. Members of the public may obtain
     copies from Aberforth  Partners, 14 Melville Street, Edinburgh EH3 7NS or from its website at www.aberforth.co.uk.


CONTACT:     David Ross          Aberforth Partners          0131 220 0733

Aberforth Partners, Secretaries - 17 July 2003

ANNOUNCEMENT ENDS