Final Results

F&C U.S. Smaller Companies PLC
15 September 2004

Date:              15 September 2004

Contact:           Robert Siddles                  Lisa Stanley
                   F&C Management Limited          Lansons Communications
                   020 7628 8000                   020 7294 3692



                          F&C US SMALLER COMPANIES PLC
                   Unaudited Preliminary Statement of Results
                        for the year ended 30 June 2004


HIGHLIGHTS

•          The net asset value (NAV) per share of the Company rose 22.2% to
244.53p, compared to an increase of 20.0% in our benchmark, the
sterling-adjusted Russell 2000 Index.

•         Your Company's NAV performance has exceeded its benchmark for the last
four years and in ten out of the eleven years since formation.

•         The Board believes that the Company's risk averse approach will
continue to benefit shareholders over the longer term.

SUMMARY OF RESULTS

                                             30 June 2004            30 June 2003               % change

Net assets                                        £64.76m                 £53.27m                 +21.59

Net asset value per share                         244.53p                 200.06p                 +22.23

Share price                                       216.50p                 192.00p                 +12.76


Extracts from the Chairman's Statement

Dear Shareholder

I am pleased to report a better performance for US equity markets during the
Company's financial year.  The net asset value (NAV) per share of the Company
rose 22.2% to 244.53p, compared to an increase of 20.0% in our benchmark, the
sterling-adjusted Russell 2000 Index.

Your Company's NAV performance has exceeded its benchmark for the last four
years and in ten of the eleven years since formation in March 1993.  Since then,
the NAV per share has risen by 153.3%, whereas the sterling-adjusted Russell
2000 Index gained only 106.8%.

During the year under review the Russell 2000 rose by 31.9%, in dollar terms,
significantly better than the other major indices such as the Standard & Poor's
Composite Index 500 and the more technology-orientated NASDAQ Index.  These
increased in dollar terms by 17.1% and 26.2% respectively.

Market Review

The recovery in the US economy became apparent a year ago.  The equity market
has responded with a robust rise in the first half of the Company's financial
year followed by a more measured gain in the second half.  This reflects the
shift in focus from economic recovery to concerns about rising interest rates
and energy prices.  At the same time the rally in technology shares faded.

The best performing areas within the Russell 2000 were economically sensitive
sectors, such as other (diversified companies), other energy, producer durables
and materials and processing.  The reason for this seems to have been
surprisingly strong global growth and tightness in energy markets.  The laggards
were utilities, technology and financials.  The latter have been affected by
rising interest rates.

Discount and Buybacks

The price of the shares rose by 12.8% to 216.5p over the year.  The discount to
NAV per share widened during the year from 4.0% to 11.5% and at 13 September
2004 was 13.1%.  The average discount over the financial year was 9.4%.

The Company bought back shares during the year.  There were purchases of 140,000
shares at an average discount of 12.6%.

The Board will continue to apply its policy of buying back shares at appropriate
times with a view to limiting the discount in the longer term to around 10%.

Outlook

Whilst we remain optimistic on the future prospects for the smaller company
sector in the US, some caution may be called for given prospects for rising
interest rates and a Presidential election.  The Board believes that the
Company's risk averse approach will continue to benefit shareholders over the
longer term.

AGM

The Annual General Meeting will be held on 27 October 2004 and I hope that you
will attend.  The meeting will be held in the offices of F&C Management Limited
at Exchange House, Primrose Street, London EC2A 2NY.

Gordon Grender
September 2004

Balance Sheet
at 30 June
                                                                                 2004                 2003
                                                                               £'000s               £'000s
Fixed assets
Listed investments                                                             63,843               52,135

Current assets
Debtors                                                                           171                   20
Cash at bank and short-term deposits                                            1,381                1,295
                                                                                1,552                1,315

Current liabilities
Creditors: amounts falling due within one year                                  (632)                (185)

Net current assets                                                               920                 1,130

Net assets                                                                     64,763               53,265

Capital and Reserves
Called up equity share capital                                                  6,621                6,656
Capital redemption reserve                                                      6,731                6,696
Share premium                                                                   2,468                2,468
Non-distributable reserve                                                         841                  841

Special reserve                                                                10,713               11,009

Capital reserves                                                               38,988               27,133
Revenue reserve                                                               (1,599)              (1,538)
Total shareholders' funds - equity                                             64,763               53,265



Net asset value per ordinary share - pence                                     244.53               200.06




The geographical distribution of investments at 30 June 2004 was:

United States 100%.


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


                                                                   2004                                   2003

                                      Revenue      Capital        Total      Revenue      Capital        Total
                                       £'000s       £'000s       £'000s       £'000s       £'000s       £'000s
Gains/(losses) on
Investments                                 -       12,005       12,005            -      (8,632)      (8,632)

Exchange losses on currency
balances                                    -        (148)        (148)            -          (2)          (2)
                                            
Income                                    714            -          714          526            -          526

Management fee                          (496)            -        (496)        (430)            -        (430)

Other expenses                          (175)          (2)        (177)        (164)          (6)        (170)

Net return before finance costs
and taxation                               43       11,855       11,898         (68)      (8,640)      (8,708)
                                           
Interest payable and similar
charges                                     -            -            -            -            -            -

Return on ordinary activities
before taxation                            43       11,855       11,898         (68)      (8,640)      (8,708)

Taxation on ordinary activities         (104)            -        (104)         (75)            -         (75)

Return attributable to equity
shareholders                             (61)       11,855       11,794        (143)      (8,640)      (8,783)
                                         
Dividends on ordinary shares
(equity)                                    -            -            -            -            -            -
                                            
Amount transferred (from)/to
reserves                                 (61)       11,855       11,794        (143)      (8,640)      (8,783)
                                         
Return per ordinary share -
pence                                  (0.23)        44.53        44.30       (0.49)      (29.62)      (30.11)
                                       

* 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.


Cash Flow Statement
For the year ended 30 June

                                                                              2004                        2003
                                                                            £'000s                      £'000s


Net cash inflow/(outflow) from operating activities                              8                        (51)
Taxation paid                                                                (104)                        (76)
Net cash inflow from financial investment                                      329                      12,581
Net cash inflow before use of liquid resources and
financing
                                                                               233                      12,454
Net cash outflow from financing                                                  -                    (12,541)
Increase/(decrease) in cash                                                    233                        (87)


Notes

The Board recommends that no final dividend payment be made.

The above financial information comprises non-statutory accounts within the
meaning of section 240 of the Companies Act 1985. The financial information for
the year ended 30 June 2003 has been extracted from published accounts for the
year ended 30 June 2003 that have been delivered to the Registrar of Companies
and on which the report of the auditors has been unqualified.

The Report and Accounts will be posted to shareholders in late September 2004.
Copies may be obtained, during normal business hours from the registered office
of the Company, Exchange House, Primrose Street, London EC2A  2NY.

The Annual General Meeting will be held at the registered office of the Company,
Exchange House, Primrose Street, London EC2A 2NY on 27 October 2004 at 12.30 pm.

By order of the Board

F&C Management Limited, Secretary

14 September 2004


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