Interim Results

Schroder UK Growth Fund PLC
17 December 2004







Press Release

                                

For Immediate Release                                       17 December 2004



                          SCHRODER UK GROWTH  FUND plc

                           Unaudited Interim Results



The Directors of Schroder UK Growth Fund plc announce the unaudited interim
results for the six months ended 31 October 2004.



Statement of Total Return (Unaudited)


                                          Six months ended 31 October 2004           Six months ended 31 October 2003
                                           Revenue     Capital       Total         Revenue        Capital       Total
                                             £'000       £'000       £'000           £'000          £'000       £'000

Gains on investments                             -         765         765               -         24,366      24,366
Income                                       2,529           -       2,529           2,549              -       2,549
Investment management fee                    (123)       (286)       (409)           (123)          (287)       (410)
Administrative expenses                      (160)           -       (160)           (170)              -       (170)

Net return  before finance costs and         2,246         479       2,725           2,256         24,079      26,335
taxation
Interest payable                             (166)       (387)       (553)           (116)          (270)       (386)

Net return  on ordinary activities           2,080          92       2,172           2,140         23,809      25,949
before taxation
Tax on ordinary activities                       -           -           -               -              -           -
Return  on ordinary activities after         2,080          92       2,172           2,140         23,809      25,949
tax attributable to equity
shareholders
Dividends: 1st interim dividend            (2,475)           -     (2,475)         (2,523)              -     (2,523)
Transfer (from)/to reserves                  (395)          92       (303)           (383)         23,809      23,426
Return per ordinary share                    1.25p       0.06p       1.31p           1.27p         14.16p      15.43p
Dividends for the period per                 1.50p           -       1.50p           1.50p              -       1.50p
ordinary share



Summary Balance Sheet                                          At 31 October 2004            At 30 April 2004

Assets                                                                      £'000                       £'000

Listed investments at market value                                        191,449                     191,469

Loans                                                                    (25,000)                    (20,000)

Other net current assets                                                    4,057                       1,476

Net Assets                                                                170,506                     172,945

Net asset value per share                                                 102.93p                     102.92p




Abridged Cash Flow Statement                             For the six months ended    For the six months ended

                                                                  31 October 2004             31 October 2003
                                                                            £'000                       £'000


Net cash inflow from operating activities                                   3,615                       3,244


Net cash outflow from returns on investments and                            (548)                       (397)
servicing of  finance


Net cash inflow from financial investment                                     347                          50


Equity dividends paid                                                     (2,512)                     (2,523)


Net cash inflow from financing                                              2,725                           -
Net cash inflow                                                             3,627                         374





This announcement is prepared on the basis of the accounting policies as set out
in the most recently published set of annual financial statements.



The Board of Directors approved this statement on 17 December 2004.



Statement by the Chairman, Mr Alan clifton



Performance



For the period ended 31 October 2004, the Company's net asset value produced a
total return of 1.6%*. The total return on the FTSE All-Share Index, was 4.3%
over the same period.



Dividends



The Board has declared a first interim dividend of 1.50p per share for the year
ending 30 April 2005. This interim dividend will be payable on 31 January 2005.



Gearing Policy



A total of £20 million was drawn from the Company's £25 million borrowing
facility at 1 May 2004. In August 2004, an additional £5 million was drawn down
and the facility has remained fully drawn since that time. At 31 October 2004,
the net gearing level was 10.6%.



*source: Fundamental Data.
Continuation Vote



At the Annual General Meeting of the Company held on 4 August 2004, the ordinary
resolution proposing that the Company should continue as an investment trust for
a further five year period was overwhelmingly passed by shareholders.



Purchase of Shares for Cancellation



During the period ended 31 October 2004, the Board continued to operate its
share buy-back facility and a total of 2,400,000 ordinary shares were purchased
for cancellation.



The Directors will continue to consider purchasing shares for cancellation in
circumstances where such purchases would enhance net asset value.



Retirement of a Director



Mr Trotter has decided to retire at the end of this calendar year. Ian has
served as a Director of the Company since 1999 and during that time he has made
a significant contribution to the deliberations of the Board. He leaves with the
best wishes of the Board and our thanks.



The Board is not intending to appoint another Director for the time being.



Alan Clifton

Chairman



Investment Manager's Review



Background



The risk aversion that had been in the market since the Madrid bombings remained
until half way through the period when sentiment became less negative with share
prices rising on the back of falling oil prices, the US election result, a pick
up in corporate activity and positive trading statements from many UK companies.
There are still some areas of caution, in particular in relation to the oil
price, which is likely to stay volatile in the months ahead.  The fiscal outlook
in the US is still uncertain and the spotlight will now be on the country's
ballooning budget and current account deficits as well as the falling dollar.
There also remains a lack of clarity on US interest rates, and we will feel more
comfortable when it becomes clearer just how many more rate rises the Fed has in
mind.



The performance of the Fund has lagged the benchmark index as there has been a
divergence between the operating and share price performance of many of the
companies owned, with frequent instances of stock price moves being purely based
on short term sentiment whilst ignoring evidence of sustained business recovery.
  We would expect this to reverse as the market recognises the long term growth
prospects of these stocks.



Outlook



Looking ahead to 2005, slowing consumer activity will prove challenging for some
sectors but we do not anticipate a recession, with the Bank of England having
sufficient scope to cut interest rates if demand weakens excessively.
Corporate-facing sectors should see a continuation of the gradual improvement in
confidence and sales, but rising input costs and limited pricing power will
ensure that profit growth of many companies remains challenging.  Whilst
valuations are reasonable, headwinds to profits growth will mean that 2005
proves a testing year for investor sentiment.



As current uncertainties are gradually overcome we expect many of the companies
we favour to perform better and as such we are still comfortable with an
economically sensitive tilt to our policy. However, in order to create a
portfolio with sensibly diversified characteristics we have balanced our
cyclical exposure with some companies with strong growth prospects independent
of economic conditions, such as Tesco and Gallaher.



Schroder Investment Management Limited



FIRST INTERIM DIVIDEND



The Directors of the Company have declared the payment of a first interim
dividend of 1.50p per share for the year ending 30 April 2005.  The dividend
will be payable on Monday 31 January 2005 to shareholders on the register on 31
December 2004.



Ex-Dividend Date                    : 29 December 2004



Transfers must be lodged by         : Close of business on 31 December 2004



Dividend Warrants                   : Despatched on 28 January 2005



Payment Date                        : 31 January 2005



Dividend per share                  : 1.50p





The Interim Report will be mailed to shareholders at their registered addresses
in December 2004 and from that date copies of the Interim Report will be
available to the public at the Company's registered office: 31 Gresham Street,
London, EC2V 7QA.






Enquiries:                               Schroder Investment Management Limited
John Spedding                                                   (0207 658 3206)
17 December 2004









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