Interim Results

Graphite Enterprise Trust PLC
17 September 2004


                         GRAPHITE ENTERPRISE TRUST PLC
                           RESULTS FOR THE HALF YEAR
                                TO 30 JUNE 2004


FINANCIAL RESULTS

                                                          30 June          31 Dec      % change to
                                                             2004            2003     30 June 2004

Shareholders' Funds                                       £285.5m         £258.7m           +10.3%
Net assets per share                                       314.4p          284.9p           +10.3%
Share Price                                                236.3p          222.3p            +6.3%
FTSE All-Share Index                                      2,228.7         2,207.4            +1.0%


SUMMARY

•    Net assets per share rose by 10.3%.

•    The valuation of Maplin increased by £23.6 million.

•    Since 30 June there have been four major realisations, including
     Maplin.


CHAIRMAN'S STATEMENT

Overall Performance

In the six months to 30 June 2004 the net assets of Graphite Enterprise Trust
PLC (the 'Enterprise Trust') rose by 10.3% from 284.9p to 314.4p per share.  The
share price rose by 6.3% from 222.3p to 236.3p.  These movements compare with an
increase of 1.0% in the FTSE All-Share Index in the period.  The strong overall
performance of the Enterprise Trust was the result of a number of successful
realisations from the unquoted portfolio.

Events since 30 June

At 30 June a number of realisations were in progress that have been completed
since.  These were the disposals of Maplin and Paperchase and the refinancings
of Ridgmont and Wagamama, all of which were completed between July and early
September.  The net asset value at 30 June reflects the terms of these
realisations.

Following the completion of these realisations the share price has risen to
262.0p at the close of business on 16 September, the day before the announcement
of the interim results.  At this price, and assuming an unchanged net asset
value since 30 June, the discount of the share price to the net asset value is
16.7%.

Investment Activity

In the six months to June realisations from the investment portfolio were £24.3
million by comparison with purchases of £12.5 million.  The largest disposal
from the direct unquoted portfolio was Leapfrog, which generated £5.8 million.
This represented an uplift of £3.4 million over the valuation at the beginning
of the year.  Total disposals from the direct unquoted portfolio were £8.9
million.

A total of £11.3 million was realised from the fund portfolio, of which £6.9
million came from the Hicks, Muse, Tate & Furst Europe Fund, mostly as a result
of the disposal of the Fund's residual holding in Yell.  There were £4.1 million
of disposals from the quoted portfolio.

Additions to the direct unquoted portfolio totalled £4.7 million, of which £3.1
million was represented by an investment in Preh, a German manufacturer of
automotive components.  In the fund portfolio a new commitment of £3.4 million
was made to Sagitta Private Equity Partners III and £7.8 million was drawn down
against existing commitments.

Valuation Movements

Net gains in the investment portfolio were £28.0 million in the period, of which
£3.9 million was realised and £24.1 million was unrealised.  The largest
increases in unrealised gains were in Maplin (£23.6 million), Wagamama (£7.9
million), Ridgmont (£3.6 million) and Paperchase (£2.8 million), in all cases
reflecting the terms of transactions that have been finalised since 30 June.

In 2001 the Enterprise Trust invested £5.2 million in Maplin, the fast-growing
retailer of electronic equipment and accessories.  Maplin has been highly
successful, with turnover and profits growing rapidly in the last three years.
By 30 June 2004 a total of £9.2 million had been received from the investment in
capital proceeds and income.  In early September the investment in Maplin was
sold for £40.7 million, taking total proceeds to £49.9 million.  This represents
a multiple of 9.5 times cost and  an annual internal rate of return over the
life of the investment of 120.6%.

Both Wagamama, the chain of Japanese noodle bars, and Ridgmont, the nursing home
group, have been refinanced since 30 June.  The Enterprise Trust received £14.5
million from the refinancing of Wagamama, representing a multiple of 2.5 times
the cost of the investment.  The refinancing of Ridgmont generated £4.8 million
or 2.1 times cost.  In both cases the Enterprise Trust retains a substantial
equity stake.

The Enterprise Trust's investment in Paperchase, the specialist stationery
retailer, was sold in July for £7.4 million.  After a difficult start, the
company grew rapidly.  The exit proceeds represented a multiple of 3.7 times
cost.

Elsewhere in the investment portfolio there have been net falls in value of £9.9
million.  The largest reduction was in Standard Brands (£4.4 million) to reflect
disappointing recent trading performance.  The fund portfolio fell in value by
£1.5 million as a result of currency movements and the quoted portfolio fell
overall by £1.3 million.

Balance Sheet and Liquidity

At 30 June the Enterprise Trust had total net assets of £293.4 million.  Taking
into account commitments it was fully invested.  The investment portfolio, the
great majority of which was unquoted, had a value of £209.3 million, or 71.3% of
total net assets.  The remaining £84.1 million, or 28.7% of the assets was held
in cash and near-cash.  Commitments of £94.0 million represented 32.0% of total
net assets with the result that if all the commitments had been called, gearing
would have been 3.3%.

Revenue Account

The net revenue attributable to shareholders in the six months to 30 June was
£4.3 million, compared with the £4.4 million in the whole of 2003.  In both
periods, however, substantial dividends were received from Maplin: this year the
dividend was £2.1 million.  As there will be no further dividends from Maplin
following its disposal, it is likely that net revenue will fall, although in the
short term this should be at least partly offset by an increase in interest
income.

Outlook

We have been pleased with the performance of the Enterprise Trust in the year to
date.  We believe, despite the sluggish stockmarket, that this has been an
excellent period in which to realise investments in unquoted companies.  As a
result we have made the disposals described above.  Against this background it
is perhaps unsurprising that while we have considered a large number of
potential new investments, we have made few additions to the portfolio.

We believe that the Enterprise Trust's remaining investment portfolio provides a
solid platform as we look forward to meeting the challenge of reinvesting the
proceeds of the successful disposals of the last few months.

John Sclater
Chairman


For further information, please contact:

Rod Richards / William Eccles                                Tel:  [phone]
Graphite Capital Management Limited


                          GRAPHITE ENTERPRISE TRUST PLC

                  SUMMARY RESULTS FOR THE HALF YEAR TO 30 JUNE


Consolidated Statement of Total Return                          Half year to                       Year to
(incorporating the Revenue Account)                                  30 June                        31 Dec
                                                                 (Unaudited)                      (Audited)
                                                                        2004        2003              2003
                                                                        £000        £000              £000
Revenue Return

Income                                                                 6,008       5,051             7,537
Investment management fee                                              (576)       (533)           (1,076)
Other expenses                                                         (368)       (408)             (770)
Net return before finance costs and taxation                           5,064       4,110             5,691
Interest payable and similar charges                                       -           -              (15)
Return on ordinary activities before taxation                          5,064       4,110             5,676
Taxation on ordinary activities                                        (818)       (785)           (1,242)
Return attributable to equity shareholders                             4,246       3,325             4,434

Dividends in respect of ordinary shares  (equity)                          -           -           (3,904)
Transfer to reserves                                                   4,246       3,325               530

Capital Return
Net gains on investments                                              28,007       9,516            26,319
Investment management charges                                        (1,233)     (1,600)
                                                                                                   (3,229)
Other expenses                                                         (780)         (4)             (152)
Taxation on ordinary activities                                          818         480             1,245
                                                                                                     
                                                                      26,812       8,392            24,183
Minority interests                                                   (4,312)       (969)           (1,406)
Net capital return                                                    22,500       7,423            22,777

Total Return                                                          26,746      10,748            23,307

Revenue return per ordinary share                                      4.68p       3.66p             4.88p
Capital return per ordinary share                                     24.78p       8.18p            25.08p
Total return per ordinary share                                       29.46p      11.84p            29.96p


Consolidated Assets                                                        30 June                  31 Dec
                                                                      (Unaudited)                (Audited)
                                                                            2004       2003           2003
                                                                            £000       £000           £000

Listed investments                                                        19,271     20,222         24,614
Unlisted investments at directors' valuation                             189,997    159,318        168,467
Total investments                                                        209,268    179,540        193,081
Net current assets                                                        84,153     70,714         69,734
Total net assets                                                         293,421    250,254        262,815
Minority interest                                                        (7,970)    (4,108)        (4,110)
Equity Shareholders' funds                                               285,451    246,146        258,705

Net asset value per share                                                 314.4p     271.1p         284.9p


Consolidated Cash Flow Statement                                Half year to                       Year to
                                                                     30 June                        31 Dec
                                                                 (Unaudited)                     (Audited)
                                                                        2004        2003              2003
                                                                        £000        £000              £000

Net cash flow from operating activities                                1,931         942               943
Returns on investments and servicing of finance                            -           -              (15)
                                                                                         
Taxation                                                                 642         173               544
Acquisitions and disposals                                            11,826     (4,139)             (865)
Equity dividends paid                                                (3,904)     (3,904)           (3,904)
Net cash inflow/(outflow) before financing                            10,495     (6,928)           (3,297)
Management of liquid resources                                        -           26,000            18,500
Financing                                                              (457)       (791)           (1,321)
Increase in cash                                                      10,038      18,281            13,882

Reconciliation of net cash flow to movement in net debt

Increase in cash                                                      10,038      18,281            13,882
Cash outflow from change in liquid resources                               -    (26,000)          (18,500)
Change in net liquid funds resulting from cash flows                  10,038     (7,719)           (4,618)
Exchange difference                                                                                  
                                                                       (227)         (4)              (39)
Income received via capital                                                         
                                                                         874         866             1,550
Movement of net liquid funds                                          10,685     (6,857)           (3,107)
Net liquid funds at 1 January                                         73,528      76,635            76,635
Net liquid funds 30 June/31 December                                  84,213      69,778            73,528

Reconciliation of operating profit to net cash flow from
operating activities

Net revenue on ordinary activities before taxation                     5,064       4,110             5,676
                                                                                 
Add back interest payable                                                  -           -                15
                                                                                                       
Income before interest payable and taxation                            5,064       4,110             5,691
(Increase)/decrease in debtors                                                                         
                                                                       (466)       (388)               241
Increase in creditors                                                    812          81                88
Income received via capital                                            (874)       (866)           (1,550)
Tax on investment income within income                                 (873)       (395)             (298)
                                                                                                   
Management charges taken to capital                                  (1,732)     (1,600)           (3,229)
Net cash inflow from operating activities                                                            
                                                                       1,931         942              943


Geographical distribution of portfolio investments
at 30 June 2004                                                               UK      Non-UK         Total
                                                                               %           %             %

Listed                                                                         9           -             9
Unlisted                                                                      71          20            91
                                                                              80          20           100

Notes

Revenue return before taxation and revenue return per ordinary share for the
half year are not necessarily indicative of the likely outcome for the full
year.

As in previous years, the directors do not propose to pay an interim dividend.

The summary financial statements at 31 December 2003 have been compiled from the
latest published accounts.  Those accounts have been delivered to the Registrar
of Companies: the report of the independent auditors thereon was unqualified.
The financial information for the year ended 31 December 2003 included within
this interim report does not constitute full accounts within the meaning of
section 240 of the Companies Act 1985.

Copies of the Interim Report will be posted to all shareholders on or around 30
September 2004 and copies may be obtained during normal business hours from the
Company's registered office thereafter.


By order of the Board                                          Registered Office
Graphite Capital Management Limited                        Berkeley Square House
Secretary                                                        Berkeley Square
                                                                  London W1J 6BQ
                                                              Tel: [phone]



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