Final Results

3i Smaller Quoted Co's Trust PLC
26 April 2001

3i SMALLER QUOTED COMPANIES TRUST plc
ANNOUNCEMENT OF PRELIMINARY RESULTS
FOR THE YEAR ENDED 28 FEBRUARY 2001

'A Fair Performance in Difficult Markets'

3i Smaller Quoted Companies Trust plc today announces preliminary results
for the year ended 28 February 2001.

Key Points

Net asset value per share fell by 15.9% to 282.8p, compared to a fall of
4.0% in the benchmark FTSE SmallCap Index excluding Investment Companies

Net asset value performance in line with the average smaller company
investment trust, calculated on a size weighted basis

The fall in asset value per share reflected primarily the fall in share
prices of the part of the portfolio invested in technology stocks

Good long term record with net asset value per share up 38.2% over 3
years, 9.2% ahead of the benchmark index and 31.3% ahead of the FTSE
All-Share Index

Underlying earnings per share of 4.64p (before receipt of special dividends
of 0.05p per share) compared with 4.46p for the previous year

Total dividend increased 3% to 4.33p per share

Bill Govett, Chairman commented:

'In difficult market conditions, we have had to give back some of the gains
made in the previous year.  At this point in time, it is too early to tell
how long the slowdown will last and how severely it will affect the UK and
other European economies. On a more encouraging note and against this
uncertain background, UK smaller companies tend to be more domestically
orientated than the UK market as a whole.  Furthermore, the UK economy,
although slowing, is likely to be supported by increasing government
spending.  Finally, across many sectors of the market, valuations are
more attractive than they have been in recent years.'


For further information, please contact:
Henrietta Marsh, 3i Investments plc            020 7 975 3531
Issued by:
Robin O'Kelly, Burson-Marsteller               020 7 300 6423

Chairman's statement

Performance
The performance of the UK market in the year to 28 February 2001 has
been characterised by periods of volatility and switches in market
sentiment between sectors and styles of investment approach. The Trust
has performed in line with the average smaller company investment trust,
calculated on a size weighted basis but, in common with other smaller
company funds, found market conditions difficult particularly during
the second half of the year. The net asset value per share fell by 15.9%
during the year. This compares with a fall in the benchmark FTSE SmallCap
Index excluding Investment Companies of 4.0% which was in line with the
fall in the UK market as a whole.

The reduction in the Trust's asset value per share has reflected,
primarily, falls in the share prices of technology stocks. The Trust
holds shares in some of these companies because they meet the Trust's
investment criteria, having good market positions, strong management teams
and growth potential. This investment focus has served shareholders
well over the longer term. In the three years to 28 February 2001, the
Trust's net asset value per share increased 38.2%, outperforming the
benchmark index by 9.2% and the FTSE All-Share Index by 31.3%.

Earnings and dividends
Earnings per share for the year to 28 February 2001 were 4.69p. This
figure includes receipts of 0.05p in respect of special dividends
which are difficult to predict, often being received from companies
which are restructuring. For the previous year, earnings per share
excluding such special dividend receipts were 4.46p. The directors are
recommending an increase in total dividend for the year of 3% to 4.33p.
In reaching this recommendation, the directors have taken account of
their policy of seeking to pay progressive increases in dividends
which has to be balanced by the tendency of some companies to pay low
dividends in order to conserve cash to fund growth.

Discount and share buy-backs
The Board pays close attention to the discount to net assets at which
the Trust's shares trade. In the year to 28 February 2001, the discount
ranged between 8% and 28%. During May 2000, when the Trust's shares traded
at a discount of 26%, compared to a sector average of 21%, the Board
used its powers to buy back 200,000 shares. The discount subsequently
narrowed to 17% by the end of August 2000 and finished the financial
year at 15%.

The Board will be seeking renewal of its authority to buy back shares
at the Annual General Meeting. The primary purpose of any buy-back is to
enhance net asset value for all continuing shareholders with a secondary
aim of reducing the discount. Over the year, the discount has averaged 16%
which compares to 17% for the size weighted average for the smaller
companies investment trust sector as a whole.

Savings plan
The Manager is unable to offer a Savings Plan for regulatory reasons
and after exploring alternatives has reluctantly given notice to close
the existing Scheme. The Board and the Manager continue to value the
support of private shareholders and are seeking alternative ways to
encourage their ongoing participation in the Trust.

Gearing
Gearing levels are set by the Board, in consultation with the Manager,
with the objective of increasing long term returns to shareholders. The
Board considers that, in normal market conditions, a gearing level of
10% will achieve this objective without adding undue risk. During the
year, gearing averaged around 9%. The debt facilities currently available
to the Trust are the £15m Debenture, the £15m revolving credit facility
and the £5m overdraft facility. The facilities gave potential gearing
of 21% at the year end.

Risk management
The Board seeks to identify and monitor all the significant risks to
which the Trust is exposed. As to portfolio risk, the Board reviews
large exposures to sectors and individual investments. The policy of
the Board is that risks should be managed in a fashion appropriate for
a general smaller company trust, with investment broadly diversified
across sectors whilst taking advantage of the link with 3i.

Market conditions
The dramatic fall in the share prices of technology companies worldwide
has now spread to the broader markets and many have recorded severe falls
from their peaks. Economic growth has fallen sharply in the USA accompanied
by profit warnings from some leading companies, but more particularly
companies in the new economy sector as they strive to bring inventories
under control. This slowdown in corporate activity may now extend to
Europe and Asia. The Federal Reserve has responded with cuts in interest
rates and more are thought likely to come. However, at this point in
time, it is too early to tell how long the slowdown will last and how
severely it will affect the UK and other European economies.

On a more encouraging note and against this uncertain background, UK
smaller companies tend to be more domestically orientated than the UK
market as a whole. Furthermore, the UK economy, although slowing, is
likely to be supported by increasing government spending. Finally,
across many sectors of the market, valuations are more attractive
than they have been in recent years.



William Govett
25 April 2001

Investment Manager's review

Overall performance and strategy
The net asset value per share of the Trust fell by 15.9% in the year to
28 February 2001, compared to a fall of 4.0% for the benchmark index.
In recent years, the Trust has tended to outperform its benchmark index
when growth stocks outperformed and when the new issue market was
strong. These tendencies were borne out in the year under review. In the
first half, although growth stocks were falling out of favour and the
techMARK 100 Index fell sharply, the Trust was able to outperform its
benchmark and produce an increase in net asset value per share through
strong contributions from new issues and through good stock selection,
particularly in the Information Technology sector. However, in the second
half, the new issue market became very difficult and the Trust was unable
to compensate for the underperformance of technology stocks and growth
stocks generally.

Gearing
Although gearing has contributed to the long term performance of the
Trust since it was first introduced in July 1997, it was not helpful in
the year under review. It is estimated that gearing had a negative
impact of around 1.0% on net asset value per share.

Performance of the benchmark index
The benchmark index fell 4.0% in the year to 28 February 2001. Despite
this, some sectors produced very good performances. Most notably the
Construction and Building Materials sector rose 50.5% and the Real
Estate sector rose 41.4%. The most notable negative performances were
from the Software and Computer Services sector which fell 66.7% and
the Support Services sector which fell 24.1%.

Sector and stock performance
Sector allocation, or the extent to which the Trust was over or
under weight in individual sectors as compared to the benchmark index,
was an important feature of the year. The Trust's portfolio saw a negative
impact from sector allocation which more than counteracted the positive
impact of good stock selection within the sectors.

Some of this impact arose from the rebalancing of the benchmark index
which occurred early in the year when the Trust found itself substantially
more overweight in the Software and Computer Services sector than it
had been prior to the rebalancing. In March 2000, a significant number
of companies in the Software and Computer Services sector were promoted
out of the benchmark index into the FTSE 250 Index and a number of
companies in the Buildings and Construction sector were demoted from
the FTSE 250 Index to the benchmark index. This rebalancing coincided
with the change in market sentiment away from technology companies,
and ABN AMRO estimate that this rebalancing added 7.4% to the performance
of the FTSE SmallCap Index in the calendar year. Clearly, the performance
relative to the benchmark of all smaller companies investment trusts was
affected in the same way. Against its peer group, the Trust produced a
reasonable result which was in line with that of the size weighted average
of the smaller companies investment trust sector.

Stock selection within sectors was generally good and there were some
excellent individual performances. In the Pharmaceutical sector, Dechra
Pharmaceuticals, a distributor of veterinary products and a new issue,
showed an 82% price rise and Shire Pharmaceuticals, one of the Trust's
largest holdings and a niche marketer and developer of prescription
medicines, showed a 23% rise. In the Media sector, Border Television
was taken over at a healthy premium. In the Support Services sector,
Whitehead Mann, an executive search agency, rose 65%. In the Software
and Computer Services sector, stock selection produced a significantly
better result than that sector of the benchmark index.

In some sectors, performance was held back by profit warnings. In the
Building and Construction sector, Allen revealed problems in its
building contracting and utilities services divisions. In the Engineering
and Machinery sector, Cammell Laird faced payment difficulties on a
major contract. In the Distributor sector, Headlam announced that
Eclipse Blinds, a business it had taken over in 1999, was not performing
to its expectations.

Activity
Purchase and sale activity during the year has been in line with that of
the previous year and averaged around 23% of the portfolio. 36% of
purchases were new issues and 25% of sales were as a result of takeovers.

New issues
Sentiment towards new issues was mixed during the year. Early on, a number
of high profile initial public offerings were cancelled as demand
evaporated and prices of technology stocks fell. By June the market
improved and continued to be active until November, when again sentiment
moved against new issues.

Over the year, the Trust invested £14.8m in 19 new issues. On average,
these new issues performed adequately given the market conditions
producing an uplift in value of 0.5% on the purchase price. The best
performer was Dechra Pharmaceuticals, described above, which produced
an uplift amounting to £1.2m.

Of the £14.8m invested in new issues, £10.6m was invested in nine stocks
bought directly from 3i. These stocks were selected from a total of 14
where 3i sold part of its holding on flotation and the Trust had the
opportunity to buy direct. The purchases included Profile Therapeutics,
Beeson Gregory, Bookham Technology, NetStore, Weston Medical, TeleCity,
Indigo Vision, TeleWork and TTP Communications. Although, on the whole,
these stocks initially performed well, with hindsight it is clear that
profits were not taken quickly enough. Overall, by the year end the total
loss on these stocks amounted to £1.5m or 14.5% of the purchase price.
This result is disappointing, but should be seen in the context of the
last few years where the link with 3i has proved valuable. In the year
to 29 February 2000, stocks purchased from 3i produced an uplift of
£3.9m and in the year to 28 February 1999, £3.7m.

Takeovers
Takeover activity in the portfolio began the year more strongly than it
finished. Of the 12 takeovers during the year, nine were completed in the
first half. These were BTP, Critchley, J Holt, City Technology, British
Borneo, Border Television, MG, Columbus Group and Slug & Lettuce. In the
second half, Ellis & Everard, Oxford Asymmetry and Cornwell Parker were
completed. The Trust's experience appears to correspond with the
experience in the smaller company universe generally, where activity
reduced in the fourth quarter of 2000, perhaps reflecting the higher
prices prevailing for non-technology stocks.

Other purchases and sales
The purchases, that were not bought at new issue, came from a broad
spread of industries. These included KBC Technologies, which is a
provider of consulting services to the oil industry, Harvey Nash, which
is a recruitment agency specialising in information technology staff,
Lavendon, which is a provider of powered access equipment, Shanks Group,
which is a waste management group and Minorplanet, which provides
information technology services to the road haulage industry.

The majority of sales were of technology stocks and included NSB Retail,
Bookham Technology, Autonomy, Guardian iT, DIAGONAL, Oxford
GlycoSciences, and Glotel. These sales often reflected concerns about
ratings. In addition, significant realisations were made from the holdings
in Bloomsbury, Brewin Dolphin, Lavendon, Redrow, First Technology and one
of the Trust's two remaining unquoted investments, C&J Clark, which dates
from a period when the Trust invested in unquoted stocks as well as
quoted ones.

Conclusion and outlook
The Trust has suffered a period of underperformance against the benchmark,
much of this due to sector weightings which diverged from those of the
benchmark. Some of these sector weightings arose as a result of the
rebalancings of the benchmark index which were particularly significant
in the last year. Currently, sector weightings are much more consistent
with those of the benchmark, although the Trust continues to be
overweight in the areas of the market which 3i knows well, such as
general industrials, technology and oil and gas.

Stock selection within sectors has generally been good and the Trust
continues to focus on high quality companies with good market positions,
strong management teams and growth potential. The Manager believes
these qualities will be particularly appropriate if the economic
environment becomes tougher, and merger and acquisition activity plays
a reduced role in supporting share prices at the cheaper end of the
smaller company universe.

Henrietta Marsh
3i Investments plc
25 April 2001


Statement of total return
for the year ended 28 February 2001 (incorporating the Revenue Account)

                  Year ended 28 February 2001  Year ended 29 February 2000
                  Revenue  Capital   Total     Revenue Capital   Total
                  £'000    £'000     £'000     £'000   £'000     £'000
Gains on                                                         
investments
Net realised                                                     
(losses)/gains              (4,041)   (4,041)           12,631    12,631
over previous
valuation
Net unrealised                                                   
(depreciation)             (24,854)  (24,854)           67,490    67,490
/ appreciation
                           (28,895)  (28,895)           80,121    80,121
Income             3,857               3,857    4,107              4,107
Investment          (485)   (1,455)   (1,940)    (378)  (1,135)   (1,513)
management fee
Other expenses      (312)               (312)    (253)              (253)
Net return                                                       
before finance     3,060   (30,350)  (27,290)   3,476  78,986     82,462
costs
Interest                                                         
payable and         (352)     (982)   (1,334)    (599)   (578)    (1,177)
similar
charges
Return on                                                        
ordinary           2,708   (31,332)  (28,624)   2,877  78,408     81,285
activities for
the finanical
year
Dividends         (2,494)             (2,494)  (2,433)            (2,433)
Transfer to          214   (31,332)  (31,118)     444  78,408     78,852
reserves
Return per        4.69p    (54.25p)  (49.56p)  4.97p   135.37p   140.34p
ordinary share
(pence)

All revenue and capital items in the above statement derive from continuing
operations.

No operations were acquired or discontinued during the year.

Balance sheet
as at 28 February 2001

                                              2001       2000
                                              £'000      £'000
Fixed assets                                             
Investments                                   180,779     210,558
Current assets                                           
Debtors                                         1,043       1,716
Cash and short term deposits                    3,078         576
                                                4,121       2,292
Creditors: amounts falling due within          (6,986)     (3,379)
one year
Net current liabilities                        (2,865)     (1,087)
Total assets less current liabilities         177,914     209,471
Creditors: amounts falling due after          (14,688)    (14,674)
more than one year
Net assets                                    163,226    194,797
Capital and reserves                                     
Called-up share capital                        14,430     14,480
Share premium                                  38,952     38,952
Capital redemption reserve                         50          -
Capital reserve - realised                     63,970     48,742
- unrealised                                   43,346     90,359
Revenue reserve                                 2,478      2,264
Total shareholders' funds                     163,226    194,797
Net asset value per share (pence)             282.8p     336.3p

The financial statements were approved by the Board on 25 April 2001
and were signed on its behalf by:

William Govett
Director

Cash flow statement
for the year ended 28 February 2001

                                              2001      2000
                                              £'000     £'000
Operating activities                                    
Investment income received                      3,790     3,775
Deposit interest received                          72       313
Underwriting commisison received                   10        30
Investment management fees paid                (1,685)     (942)
Secretarial fees paid                             (59)      (59)
Other cash receipts                                 -         8
Other cash payments                              (246)     (201)
Net cash inflow from operating                  1,882     2,924
activities
Servicing of finance                                    
Interest paid                                  (1,312)   (1,162)
Net cash outflow from servicing of             (1,312)   (1,162)
finance
Financial investment                                    
Purchase of investments                       (44,308)  (42,324)
Sale of investments                            45,635    34,591
Net cash inflow/(outflow) from                  1,327    (7,733)
financial investment
Equity dividends paid                          (2,442)   (2,716)
Financing                                               
Purchase of ordinary shares for                  (453)        -
cancellation
Drawdown of short term loan                     3,500         -
Net cash inflow from financing                  3,047         -
Increase/(decrease) in cash                     2,502    (8,687)



Notes to the financial statements for the year ended 28 February 2001

1.   Reconciliation of net revenue                     2001       2000
     before finance costs to net cash                 £'000      £'000
     inflow    from operating activities
Net revenue before finance costs                      3,060      3,476
Scrip dividends                                         (46)       (40)
Investment management fee allocated                  (1,455)    (1,135)
to capital reserve - realised
Decrease in accrued income                               61         50
Increase in creditors                                    69        581
Decrease/(increase) in debtors                          193         (8)
Net cash inflow from operating                        1,882      2,924
activities
                                                               
2.   Reconciliation of net cash flow                   2001       2000
     to movement in net debt                          £'000      £'000
Increase/(decrease) in cash in the                    2,502     (8,687)
year
Cash inflow from increase in                         (3,500)          -
debt
Amortised Debenture stock issue                         (14)       (15)
expenses
Movement in net debt in the year                     (1,012)    (8,702)
Opening net debt                                    (14,098)    (5,396)
Closing net debt                                    (15,110)   (14,098)
                                                               
                                                               
3.   Analysis of changes in net debt                           
                            Opening   Cash flows    Amortised  
                                                    issue      Closing
                                                    expenses   
                            £'000     £'000         £'000      £'000
Cash and short term             576        2,502          -       3,078
deposits
Debt due within one year    -             (3,500)         -      (3,500)
Debt due after more than    (14,674)           -        (14)    (14,688)
one year
                            (14,098)        (998)       (14)    (15,110)

Notes to the announcement

1.  A final dividend of 2.62p per ordinary share is recommended and,
subject to its approval at the Annual General Meeting in June 2001,
will be paid on 19 June 2001 to shareholders on the register at 18
May 2001.   Together with an interim dividend of 1.71p per share
paid in November 2000 this makes a total of 4.33p per share for
the year, compared with 4.20p per share for the year ended 29
February 2000.

2.  The Report and Accounts will be posted to shareholders on 1 May
2001 and the Annual General Meeting will be held at 12 noon
on 4 June 2001 at the offices of 3i plc, 91 Waterloo Road,
London SE1 8XP.

3.  The statutory accounts for the year to 28 February 2001 have not
yet been delivered to the Registrar of Companies. The statutory
accounts for the year to 29 February 2000 were filed with the
Registrar of Companies on 8 August 2000. The auditors' reports
on these statutory accounts are unqualified and do not contain
any statements under Section 237(2) or (3) of the Companies Act
1985.   This announcement does not constitute statutory accounts.


Notes to editors

3i Smaller Quoted Companies Trust plc is managed by 3i Investments plc,
which is regulated by the Securities and Futures Authority and seeks to
achieve returns in excess of the benchmark index through the use of
fundamental analysis.

3i Investments plc is a wholly owned subsidiary of 3i Group plc ('3i'),
Europe's leading venture capital company.  The relationship with 3i
brings several important benefits to 3i Investments plc and the funds
that it manages including access to 3i's international network,
operating across three continents.  This provides an important source
of information on local companies.