Final Results

Foreign & Colonial U.S.Smllr.Co PLC
7 September 2000



FOREIGN & COLONIAL U.S. SMALLER COMPANIES PLC
Unaudited Preliminary Statement for the year ended 30 June 2000


Date:     6 September 2000

Contact:  Graeme Glen                              Claire Barry / Louise Dolan
          Foreign & Colonial US Smaller Companies  Financial Dynamics
          020 7628 8000                            020 7831 3113




                 FOREIGN & COLONIAL U.S. SMALLER COMPANIES PLC
                        Unaudited Preliminary Statement
                        for the Year ended 30 June 2000



HIGHLIGHTS

-    The net asset value per share rose by 5.7% to 243.35 pence

-    Since inception the net asset value has risen by 152.3%, which compares
     to a 116.6% increase in the Russell 2000

-    The buy back programme added approximately 10p per share to the fully
     diluted net asset value per share at 30 June 2000.

-    As at 5 September 2000 the discount stood at  9.5% and has ranged between
     5.1% and 15.8%

-    The Company repurchased around 31% of the outstanding warrants at an
     average price of 92p



SUMMARY OF RESULTS

                           30 June 2000   30 June 1999        % Change
                                                                      
Net assets                                                            
attributable to                                                       
equity shareholders             £80.95m       £115.96m          -30.2%

Net assets per share                                                  
                                243.35p        230.30p           +5.7%
Net Assets per share                                                  
(diluted)                       228.44p        217.82p           +4.9%

Share price                     200.00p        183.25p           +9.1%

Warrant price                   103.00p        105.00p           -1.9%



Extracts from Chairman's Statement

Dear Shareholder,

                                    Results


I am pleased to present the annual report for Foreign & Colonial US Smaller
Companies PLC for the year ended 30 June 2000.  In the more speculative
investment environment of the past year our risk averse investment strategy,
with a focus on companies with a history of consistent profitability, has
produced below average returns.  As a result your Company underperformed its
benchmark for the first year in its seven year history.

For the year to 30 June 2000 the net asset value per share rose by 5.7%.  This
compares with a 17.7% rise in our sterling converted benchmark, the Russell
2000 Smaller Companies Index.  Since the inception of the Company in March
1993, the net asset value per share has risen by 152.3%.  This compares to an
increase of 116.6% in the Russell 2000.

Despite several increases in interest rates by the Federal Reserve Board, the
US stock market has made good progress with particularly strong gains being
seen in the technology and health care sectors which rose by 71.6% and 56.6%
respectively (Russell 2000 Index, sterling adjusted) over the period under
review.  Many companies in the technology sector have relatively small revenue
bases and are losing money.  The investment strategy of the Company is to try
to find companies with strong franchises and strong free cash flow to fund
expansion.  Careful attention is paid to the quality and life of the assets.
Despite the rapid growth being achieved by many technology companies, few fit
these criteria and the Manager has remained substantially underweight in the
sector.  This decision has had a major negative impact on performance.  In
addition a number of our investments in the consumer sector which appeared to
offer better value performed poorly as investors concentrated on more rapidly
growing areas of the market.

In line with the stated policy in previous years, your Board is not
recommending the payment of a dividend for the year ended 30 June 2000.

                         Share and Warrant Repurchase
At two separate extraordinary general meetings held during the course of the
year and at the last annual general meeting , shareholders gave the Board the
requisite authority to buy back shares for cancellation.  Since shareholders
first gave the necessary authority in July 1999, 17,132,885, or 34%, of the
ordinary shares in issue have been bought back. The share repurchase programme
has had the effect of reducing the size of your Company so that at 30 June
2000 the net assets stood at £80.95 million compared with £115.96 million a
year earlier.  The programme added approximately 10p per share to the fully
diluted net asset value as at 30 June 2000. The discount to net asset value at
which the shares trade, 9.5% at 5 September 2000, has ranged between 5.1% and
15.8% over the year.

Your Board remains committed to an active policy of buying back the ordinary
shares of the Company with the aim of reducing the discount to net asset value
at which the shares trade and enhancing the net asset value per share.

Your Board also has a policy of repurchasing warrants for cancellation
provided such repurchases add to the diluted net asset value. During the last
financial year the Company repurchased around 31% of the outstanding warrants
at an average price of 92p. Since the inception of the Company in 1993, 56% of
the warrants that were issued have either been exercised or repurchased.



                                   Prospects
The signs from around the world generally indicate that economic growth is
likely to slow and this could begin to affect the US.  For the moment consumer
spending in the US is particularly sensitive to swings in the stock market as
consumer instalment debt, relative to personal income, is at a record high.
Energy prices have had their biggest increase for 20 years and the real
Federal Funds Rate is at its highest level since 1989.  With this background
further increases in interest rates may not occur.  We have begun to see signs
of better relative performance from smaller companies.  Much of this
performance has been attributable to a relatively narrow group of highly rated
technology and biotechnology companies.  Since the sharp correction in the
NASDAQ index in April and May, the breadth of the market has improved and with
it the relative performance of the portfolio.  We still believe that many
technology issues are overpriced while many of our major investments appear
undervalued.  We therefore hope that after a disappointing year the relative
performance of your Company will improve in the coming months.

Gordon Grender


September 2000


Balance Sheet
                                      30 June 2000   30 June 1999
                                            £000's         £000's
Fixed assets                                                     
Investments                                 78,598        108,583
Current assets                                                   
Debtors                                        171          1,686
Taxation recoverable                            42             34
Cash at bank and short-term                                      
deposits                                     2,395          8,062
                                             2,608          9,782
                                                                 
Current liabilities                                              
Creditors: amounts falling due                                   
within one year                              (260)        (2,410)
                                                                 
Net current assets                           2,348          7,372
                                                                 
                                                                 
Net assets                                  80,946        115,955
                                                                 
                                                                 
Capital and Reserves                                             
Called up share capital                      8,316         12,587
Capital redemption reserve                   4,283              -
Share premium                                   50         32,782
Warrant reserve                              1,438          2,101
Special reserve                             27,945              -
Capital reserves                            39,630         68,882
Revenue reserve                              (716)          (397)
Total shareholders' funds                   80,946        115,955
                                                                 
                                                                 
                                                                 
Net asset value per ordinary share                               
(basic)- pence                              243.35         230.30
Net asset value per ordinary share                               
(diluted) - pence                           228.44         217.82
                                                                 
                                                                 


Statement of Total Return (incorporating the Revenue Account)
for the year ended 30 June 2000

              Revenue  Capital    30 June  Revenue £    Capital     30 June
              £ 000's  £ 000's       2000      000's    £ 000's        1999
                                    Total                             Total
                                  £ 000's                           £ 000's
Gains and                                                                  
losses on                                                                  
Investments         -    (202)      (202)          -      8,645       8,645
                                                                           
Exchange                                                                   
gains and                                                                  
losses              -     (40)       (40)          -        338         338
                                                                           
Income            627        -        627      1,102          -       1,102
                                                                           
Management                                                                 
fee             (695)        -      (695)      (830)          -       (830)
                                                                           
Loss on                                                                    
warrants                                                                   
purchased                                                                  
for                                                                        
cancellation        -  (1,158)    (1,158)          -      (376)       (376)
                                                                           
Other                                                                      
expenses        (182)     (13)      (195)      (147)      (173)       (320)
                                                                           
Net return                                                                 
before                                                                     
finance                                                                    
costs and                                                                  
taxation        (250)  (1,413)    (1,663)        125      8,434       8,559
                                                                           
Interest                                                                   
payable and                                                                
similar                                                                    
charges                                                                    
                    -        -          -          -          -           -
                                                                           
Return on                                                                  
ordinary                                                                   
activities                                                                 
before                                                                     
taxation        (250)  (1,413)    (1,663)        125      8,434       8,559
                                                                           
Taxation on                                                                
ordinary                                                                   
activities                                                                 
                 (69)        -       (69)      (127)          -       (127)
                                                                           
Return on                                                                  
ordinary                                                                   
activities                                                                 
after                                                                      
taxation        (319)  (1,413)    (1,732)        (2)      8,434       8,432
                                                                           
Dividend on                                                                
ordinary                                                                   
shares              -        -          -          -          -           -
                                                                           
Amount                                                                     
transferred                                                                
(from) / to                                                                
reserves        (319)  (1,413)    (1,732)        (2)      8,434       8,432
                                                                           
Return per                                                                 
ordinary                                                                   
share -                                                                    
pence          (0.86)   (3.81)     (4.67)          -      16.75       16.75
                                                                           
Return per                                                                 
ordinary                                                                   
share -                                                                    
diluted -                                                                  
pence           +        +          +              -      16.00       16.00

-    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.
-    The Directors recommend that no dividend be paid for the year to 30 June
     2000.
-    There is no dilution

Cash Flow Statement for the year ended 30 June 2000

                                                                       
                                        30 June 2000       30 June 1999
                                             £ 000's            £ 000's
                                                                       
Net cash (outflow)/ inflow from                                        
operating activities                           (233)                 74
Tax paid                                        (86)              (111)
Net cash inflow from financial                                         
investment                                    27,372              4,947
Net cash inflow before financing                                       
                                              27,053              4,910
Management of liquid resources                                         
                                               6,362            (6,175)
Net cash (outflow)/inflow from                                         
financing                                   (32,717)                 23
Increase/(decrease) in cash                      698            (1,242)


Notes

No dividend will be paid on the ordinary shares.


The Annual Report and Accounts will be posted to all shareholders on 20
September 2000. Copies may be obtained during normal business hours from the
Company's Registered Office, Exchange House, Primrose Street, London EC2A 2NY.



By order of the Board
Foreign & Colonial Management Limited, Secretary

6 September 2000