Final Results - Replacement

Capital Gearing Trust PLC
8 June 2001

CAPITAL GEARING TRUST plc

PRELIMINARY ANNOUNCEMENT

5 April 2001

The issuer advises that the following replaces the 'Final Results'
announcement released today, 8 June 2001, at 12:54, under RNS number 9532E.

The announcement should state that the dividend will be paid on 10th July 2001
to shareholders on the register as at 22nd June 2001 and not on the register
as at 20th June 2001 as previously stated.

All other details remain unchanged. The full amended text appears below.





CHAIRMAN'S STATEMENT

The cautious investment stance adopted by the Trust over the year to 5th April
2001 proved rewarding to shareholders with a rise in the net asset value per
share of 10.2% to 1101p compared with a fall in the Investment Trust Index of
10.6%, a fall in the FTSE All Share Index of 10.7%, and a fall in the FTSE All
Stocks Gilt Index of 0.4%. This may be considered a good result and I think
demonstrates the value of taking an independent line in judging markets and
not being driven by short-term performance league tables. Over the year the
discount of the share price to net asset value traded in a relatively narrow
range closing the year at a small discount of 1%. The Board used the powers
granted by shareholders to buy in a small amount of stock on advantageous
terms, and it is proposed that the powers to buy in (and sell out) be renewed
at the forthcoming Annual General Meeting.

In January 2001 Peter Spiller, the partner of Cazenove & Co. appointed to
manage the portfolio and a director of the Trust, informed the Board of his
intention to retire from Cazenove on 30th April 2001 and an announcement was
made to this effect at the time. He has now set up a small investment
management company of his own. While regretting the resulting severance of our
close links with Cazenove, the independent directors concluded that it was in
the best interest of shareholders to retain the services of Peter Spiller as
investment manager. I am pleased to report that the practical aspects of this
changeover were satisfactorily resolved and CG Asset Management Ltd. was
appointed Investment Manager with effect from 1st May, 2001. I am happy to
confirm that Cazenove & Co. Ltd., remain the Trust's Corporate broker.

Later this year we intend to enter trading in the Trust's share capital into
the Crest system of computerised settlement which we consider will benefit
shareholders.

Turning to the Revenue account, earnings per share for the year rose to 9.92p.
The Directors now recommend a dividend of 8.00p compared with 7.00p in 2000.
This dividend will be paid on 10th July, 2001 to shareholders on the register
as at 22nd June, 2001.

The spread of the investment portfolio remains defensive in character with
over 60% of the assets invested in investment trust zero dividend preference
shares and fixed interest stocks compared with 70% at this time last year,
reflecting our current view of markets. While we are clearly interested in the
zero dividend preference share market the security and liquidity of some of
the stock on offer raise some questions.

The organisational changes to which I have referred above and in last year's
Statement will take time to settle down. However, I am confident that the
investments are well managed and positioned to weather the uncertain
conditions we currently face in markets.

MANAGER'S REPORT AND PORTFOLIO ANALYSIS

Last year presented a tough environment with both the MSCI International and
FT All Share down by more than 10%. The technology, media and telephone
sectors were particularly weak, following the Nasdaq bubble of the previous
year. Against that background, the increase in net asset value per share of
Capital Gearing Trust of 10% may be regarded as satisfactory.

The portfolio benefited from overall asset allocation, sector bias and stock
selection. Throughout the year, equity exposure was kept below 35%. This
reflected a view that the fundamental position of world economies, and
particularly that of the US, demonstrated important imbalances that must
eventually lead to a recession. In addition, the flood of liquidity that the
Federal Reserve had injected into the US economy had driven share valuations
to unsustainable levels; in the case of technology, these reached manic
proportions. Your portfolio was heavily biased towards old economy stocks and
profits were taken on holdings that had done well out of high growth stocks
such as Scottish Value, which doubled in a year. Tor Capital, a long-held
investment, duly reconstructed in the summer of 2000, which, of course,
eliminated the discount. Electra tendered for part of its stock and your
portfolio reduced its holding at a good price. Five Arrows Chile went into
liquidation and Murray Emerging Economics reconstructed, the latter showing a
small profit on the year, following excellent earlier returns, despite the
difficult times for emerging markets. Other good performances were provided by
the managers of both Aberforth Split Capital Shares and Gartmore Irish. In
both cases the discount narrowed as well.

In the area of bond funds, the portfolio benefited from the reconstruction of
our holding in Latin American Extra Yield and further progress by the Asia
High Yield Bond Fund; here the combination of asset growth and reduction in
discount produced a 60% return in Yen. In general, our direct holdings of
bonds did well in local terms. The US Treasury Inflation Protected Securities
reflected a re-rating, inflation and a strong US dollar. The weakness of the
Euro reduced the sterling value of our bonds in Europe. In the UK, the large
holdings of zero-coupon preference shares, which have a short duration, were
also re-rated so that the return exceeded the redemption yield at the
beginning of the year.

OUTLOOK

In last year's report, I referred to the overheated economy and highly valued
stock market in the US. It is true that NASDAQ has seen a dramatic correction,
but share prices overall still look too high. Indeed, monetary policy has been
so stimulative, with money supply showing rapid growth over the last year and
continued expansion of credit throughout the private sector, that the Federal
Reserve appears to be trying to re-inflate the stock market bubble.
Unfortunately, that has made the financial imbalances in the economy even
worse, with the consumer over-extended, though as yet showing no sign of
retrenchment, and corporate America over-investing, although the correction in
this area has begun. With the outlook for profits poor, the stock market will
be a struggle between continued liquidity and lower interest rates against
poor profitability and over-valuation. The short term is therefore hard to
call, but there is little doubt that the market is vulnerable to further falls
in time. It is likely that both the economies and stock markets in the rest of
the world will respond to the trends in the US.

Happily, the opportunity to make reasonable returns remains. The portfolio of
zero-coupon preference shares is of high quality but should nevertheless
produce an attractive return in real terms. The long-term US index linked
bonds still look too cheap and further re-rating is expected; some of the gain
may be lost if - one is tempted to say when - the dollar weakens. Conventional
bonds in Euros on the other hand, look attractive and currency moves should
help, although appreciation may be delayed until after the introduction of the
Euro as money in the New Year.

Within the equities, the better value in smaller companies should benefit
Aberforth Split Level Capital Shares and the valuation of this well-managed
trust is still favourable. Details of the reconstruction of Investors Capital
are promised soon and should entail a small further uplift in value and
Gartmore Fledgling has already begun to liquidate. Group Trust is the subject
of a bid by Dunedin Enterprises. Both M&G Income and Schroder Split Capital,
in which we have small but highly geared exposure, are due to reorganise later
this year. In addition, there are votes in both Old Mutual South Africa and
the Asia High Yield Bond Fund. The remainder of the portfolio is in well
managed trusts where there is hope that discounts will narrow over the year.

STATEMENT OF TOTAL RETURN

(INCORPORATING THE REVENUE ACCOUNT)

FOR THE YEAR ENDED 5 APRIL 2001


                                                                              
                                        2001                             2000 
              Revenue    Capital       Total   Revenue    Capital       Total 
                    £          £           £         £          £           £ 

  Realised          -   2,249,356  2,249,356         -   1,585,803  1,585,803 
  gains on                                                                    
  investments                                                                  
                                                                             
  Net               -    145,722     145,722         -    605,416     605,416 
  change in                                                                   
  unrealised                                                                  
  appreciation                                                                  
                                                                            
  Income      424,722          -     424,722   336,947          -     336,947 

  GROSS       424,722   2,395,078  2,819,800   336,947   2,191,219  2,528,166 
  RETURN                                                                      

  Investment  (44,372)  (177,488)  (221,860)   (37,318)  (149,668)  (186,986) 
  management                                                                  
  fees                                                                        

  Other       (140,713)  (4,334)   (145,047)   (95,577)         -    (95,577) 
  expenses                                                                   

  RETURN ON   239,637   2,213,256  2,452,893   204,052   2,041,551  2,245,603 
  ORDINARY                                                                    
  ACTIVITIES                                                                  
  BEFORE                                                                      
  TAXATION                                                                    

  Tax on      (11,667)    11,667           -   (2,250)          -     (2,250) 
  ordinary                                                                    
  activities                                                                  
                                                                              
  RETURN      227,970   2,224,923  2,452,893   201,802   2,041,551  2,243,353 
  ATTRIBUTABLE                                                                  
  TO                                                                       
  EQUITY                                                                      
  SHAREHOLDERS                                                                  
                                                                            
  Dividends                                                                   
  on          (181,272)        -   (181,272)   (163,163)         -   (163,163) 
  ordinary                                                                  
  shares:                                                                     

  Dividends                                                                   
  payable -                                                                   
  8p per                                                                      
  ordinary                                                                    
  share                                                                       
  (2000 -                                                                     
  7p)                                                                         

  TRANSFER     46,698   2,224,923  2,271,621    38,639          -   (163,163) 
  TO                                                                          
  RESERVES                                                                    

  RETURN           9.92p    96.83p      106.75p     8.66p     87.58p   96.24p
  PER              
  ORDINARY                                                                    
  SHARE*                                                                      



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.

* There was no dilution in either year.





BALANCE SHEET - 5 APRIL 2001
                                                    2001          2000

FIXED ASSETS                                        £             £

Investments:
Listed investments                                  24,980,041    23,322,832

CURRENT ASSETS

Debtors                                             571,848       606,904
Cash at bank                                        171,523       104,717

                                                    743,371       711,621
CREDITORS: amounts falling due within one year      (772,807)     (750,342)

NET CURRENT LIABILITIES                             (29,436)      (38,721)

NET ASSETS                                          24,950,605    23,284,111

CAPITAL AND RESERVES

Called up share capital                             566,476       582,726
Share premium account                               991,150       991,150
Capital redemption reserve                          16,250        -
Capital reserve - unrealised                        3,794,195     3,648,473
Capital reserve - realised                          19,408,615    17,934,541
Revenue reserve                                     173,919       127,221

TOTAL SHAREHOLDERS' FUNDS - EQUITY                  24,950,605    23,284,111

NET ASSET VALUE PER ORDINARY SHARE*                 1101.1p       998.9p

* There was no dilution of the above net asset value at either date.





CASH FLOW STATEMENT

FOR THE YEAR ENDED 5 APRIL 2001


                                                 2001           2000
                                                 £              £

NET CASH INFLOW FROM OPERATING ACTIVITIES        103,332        348,497

TAXATION

Income tax recovered                             40,378         12,921

CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT

Payments to acquire investments                  (11,455,814)   (12,323,954)
Receipts from sale of investments                12,147,200     11,235,875

                                                 691,386        (1,088,079)

EQUITY DIVIDENDS PAID                            (163,163)      (116,545)

FINANCING

Purchase of own shares                           (605,127)      -

INCREASE/(DECREASE) IN CASH                      66,806         (843,206)

The financial information set out above does not constitute the company's
statutory accounts for the years ended 5 April 2000 and 2001 but is derived
from those accounts. Statutory accounts for 2000 have been delivered to the
Registrar of Companies and those for 2001 will be delivered following the
company's Annual General Meeting. The auditors have reported on those
accounts; their reports were unqualified and did not contain statements under
Article 245 (2) or (3) of the Companies (Northern Ireland) Order 1986.