Final Results

Herald Investment Trust PLC
11 February 2005



                                    PRELIMINARY STOCK EXCHANGE ANNOUNCEMENT



                             HERALD INVESTMENT TRUST plc

                    Results for the year to 31 December 2004

                                11 February 2005

                                 BOARD STATEMENT

                             CHAIRMAN'S STATEMENT



2004 has seen modest progress with the net asset value per share rising 5.2%.
Somewhat disappointingly, the performance has lagged the FTSE 100, which rose
7.5% and the Hoare Govett Smaller Companies Index, which grew 17.3%. However,
over the history of the Trust the net asset value has grown 289.5% over a period
when the FTSE 100 rose only 40.9%.  In this context, to have underperformed the
FTSE by 2.3% is not unsatisfactory in a year when Herald's target sectors have
performed poorly. The FTSE Information Technology Index, which is central to the
portfolio, attained wooden spoon status by appearing bottom of the All Share
Index table with a decline of 8.4%. The relevant sectors in the Hoare Govett
showed a weighted average total return of 1.38%. The market in the US has been
more difficult with the Russell 2000 Technology Index declining 4.3%, which
translated to £ is a decline of 10.7%.



The most encouraging outcome of 2004 has been the outstandingly strong trading
performance in the portfolio's companies. The aggregate increase in earnings in
the portfolio in 2004, according to consensus estimates, was 90.4%. This far
exceeds the return on the portfolio this year, but the strong performance in
2003 was clearly anticipating much of this growth. Consensus forecasts suggest
similar profits growth of 67.6% in 2005. By value, more than two thirds of the
portfolio has been consistently trading profitably. The P/E of these stocks in
2004 was 18.4x falling to 14.9x in 2005. A further 13.1% of the value of
equities in the portfolio at the year end is expected to have moved from losses
in 2003 to profits in 2004. Expectations are for these profits to rise
dramatically by 127.6% in 2005. Against this background, prospects for progress
in 2005 are exceptionally promising.



In spite of the growth orientation of the portfolio, a fully invested position
and a significant proportion of the portfolio not paying dividends, the Trust
has remained profitable. This is after passing all expenses through the income
account as always. Capital appreciation remains the primary objective.



The Trust became geared in 2002. These borrowings were rolled forward again in
US$ at a rate of 2.62% in October, but for much of the year similar levels of
cash have been held in £. This has provided a useful currency hedge for the US$
element of the portfolio.



The market for new issues re-emerged with a vengeance in the first half after
two years of inactivity. The market was swamped by July, and the second half has
been more sober in stock market terms in the sector. This, combined with cash
withdrawals from the sector, such as the steady redemptions in specialist
open-ended funds, has contributed to the de-rating during the year. Positively
the speculators have moved on to the mining sector!  Some acquisition activity
has countered this at substantial premiums. More bid activity is expected in
2005. There continues to be favourable macro trends including the dramatic
adoption of broadband Internet access by the consumer, albeit tempered by price
competition in many parts of the sector. Economic growth is still expected in
2005 albeit at a more modest rate than 2004. More than ever this is a stock
pickers market.



Clive Parritt and Justin Dukes have both served as directors since the Trust was
launched in 1994. Pressured by the regulatory environment and the Combined Code
of Corporate Governance with the incumbent restrictions on Director's tenure
they have decided to stand down. I would like to thank them for their efforts
over the years.  I welcome Tim Curtis to the Board.  He has recently retired as
Chief Executive of Zetex, and brings international knowledge in the
semiconductor and telecommunications equipment sector.  Shareholders will be
asked to vote on his appointment at the Annual General Meeting.



Overall there has been a dichotomy this year between depressing macroeconomic
and political news, which has understandably preyed on investors' minds, and
exceptionally strong profits performance in the underlying portfolio. Happily
this does provide an extremely solid base with which to look forward to 2005, as
ever in the absence of unforeseen shocks.







Martin Boase
Chairman
10 February 2005








                       Statistics and Performance Report


                            At inception               At               At     Performance      Performance
                                                                                     since  since inception
                        16 February 1994 31 December 2003      31 December     31 December
                                                                      2004            2003
                                                                                      
Net asset value per               98.7p+           365.4p           384.4p            5.2%           289.5%
ordinary share
Share price                       90.9p            325.3p           322.8p          (0.8%)           255.1%
FTSE 100 Index                 3,417.7            4,476.9          4,814.3            7.5%            40.9%
HGSC Index (ext. cap           1,750.0            2,346.7          2,752.2           17.3%            57.3%
gains ex investment
co's)
Russell 2000 (small                83.2*             72.9             65.1         (10.7%)          (21.8%)
cap) Technology Index
(in sterling terms)

+ 100p is shareholders' subscription price before launch costs of 1.3p.
*At 9 April 1996, being the date funds were first available for international investment.





Portfolio Performance for the 12 months to 31 December 2004


                                               Performance (total return)

Equity markets
UK                                                                9.3%
Europe ex. UK                                                    21.1%
Americas                                                        (7.1%)
Japan                                                          (17.5%)
Asia Pacific ex. Japan                                          (9.0%)



                                    - ends -



For further information please contact:



Ms Katie Potts, Manager
Herald Investment Trust plc     020 7553 6300


Baillie Gifford & Co.
Secretaries                     0131 275 2000

The following is the unaudited preliminary statement for the year to 31 December
2004 which was approved by the Board on 10 February 2005.  The Directors of
Herald Investment Trust plc are recommending to the Annual General Meeting of
the Company to be held on 13 April 2005 the payment of a final dividend of 0.30p
net (0.30p net last year) per ordinary share for the year ended 31 December
2004.





                             HERALD INVESTMENT TRUST plc

                              STATEMENT OF TOTAL RETURN

                 (unaudited and incorporating the revenue account*)


                                           for the year ended                      for the year ended
                                            31 December 2004                        31 December 2003
                                      Revenue     Capital        Total         Revenue     Capital       Total

                                        £'000       £'000        £'000           £'000       £'000       £'000


Gains on investments                        -     14,607       14,607               -     136,680     136,680
Exchange difference on loans                -      1,813        1,813               -       3,169       3,169
Currency (losses)/gains                     -        (29)         (29)              -         100         100

Income (note 1)                        4,776            -       4,776           3,882           -       3,882
Investment management fee             (3,671)           -      (3,671)         (2,727)          -      (2,727)
Other administrative expenses           (267)           -        (267)           (259)          -        (259)


Net return before finance costs
and taxation
                                         838      16,391       17,229             896     139,949     140,845
Finance costs of borrowings             (501)           -        (501)           (591)          -        (591)


Return on ordinary activities
before taxation
                                         337      16,391        16,728             305    139,949     140,254
Tax on ordinary activities               (36)           -         (36)            (29)          -         (29)

Return on ordinary activities
after taxation
                                         301      16,391       16,692             276     139,949     140,225
Ordinary dividend payable

(note 2)                                (263)           -        (263)           (263)          -        (263)


Transfer to reserves                      38      16,391       16,429              13     139,949     139,962


Return per Ordinary share
Basic and diluted (note 3)              0.34p      18.68p       19.02p           0.32p     161.39p     161.71p

Dividend per Ordinary share             0.30p                                    0.30p



* The revenue column of this statement is the revenue account of the Company.

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

                           HERALD INVESTMENT TRUST plc

                            SUMMARISED BALANCE SHEET

                              at 31 December 2004

                                  (unaudited)




                                                                      31 December 2004          31 December 2003
                                                                                 £'000                     £'000
NET ASSETS

Investments at market value                                                    325,168                   331,497
Net liquid assets                                                               36,065                    18,712
Total assets (before deduction of bank loans)                                  361,233                   350,209
Bank loans (note 4)                                                           (24,663)                  (29,325)
                                                                               336,570                   320,884


CAPITAL AND RESERVES
Called-up share capital                                                         21,889                    21,952
Capital reserves                                                               312,582                   296,871
Revenue reserve                                                                  2,099                     2,061
EQUITY SHAREHOLDERS' FUNDS                                                     336,570                   320,884



Net asset value per ordinary share (note 5)                                    384.41p                   365.44p

Ordinary shares in issue (note 6)                                           87,556,010                87,807,348









                                        DISTRIBUTION OF ASSETS
                                          at 31 December 2004
                                                (unaudited)



                                                                      31 December 2004          31 December 2003

                                                                                     %                         %


Equities:              United Kingdom                                             60.7                      63.4
                       Continental Europe                                          6.6                       6.0
                       Americas                                                   15.0                      17.8
                       Japan                                                       0.7                       0.6
                       Asia Pacific                                                7.0                       6.9
                                                                                  90.0                      94.7
Net liquid assets                                                                 10.0                       5.3
Total assets (before deduction of bank loans)                                    100.0                     100.0

                                       HERALD INVESTMENT TRUST plc

                                      SUMMARISED CASH FLOW STATEMENT
                                                 (unaudited)


                                                           for the year ended        for the year ended
                                                            31 December 2004          31 December 2003
                                                                 £'000       £'000           £'000       £'000
NET CASH INFLOW FROM OPERATING ACTIVITIES                                     762                         927
NET CASH OUTFLOW FROM SERVICING OF FINANCE                                   (495)                       (580)
FINANCIAL INVESTMENT
Purchase of investments                                       (65,423)                    (77,543)
Sale of investments                                            85,279                      74,274
NET CASH INFLOW/(OUTFLOW) FROM FINANCIAL INVESTMENT                        19,856                      (3,269)
EQUITY DIVIDEND PAID                                                         (263)                       (718)
NET CASH INFLOW/(OUTFLOW) BEFORE FINANCING                                 19,860                      (3,640)
FINANCING
Issue of Ordinary shares                                             -                      3,332
Loans drawn down                                               25,769                      37,902
Loans repaid                                                  (28,618)                    (27,718)
Shares repurchased                                               (743)                           -


NET CASH (OUTFLOW)/ INFLOW FROM FINANCING                                  (3,592)                     13,516


INCREASE IN CASH                                                           16,268                       9,876

RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET (DEBT)/
FUNDS
Increase in cash in period                                                 16,268                       9,876
Decrease/(increase) in bank loans                                           2,849                     (10,184)
Exchange movement on loans                                                  1,813                       3,169


MOVEMENT IN NET FUNDS/(DEBT) IN PERIOD                                     20,930                       2,861


NET DEBT AT 1 JANUARY                                                     (10,686)                    (13,547)


NET FUNDS/(DEBT) AT 31 DECEMBER                                            10,244                     (10,686)

RECONCILIATION OF NET REVENUE BEFORE FINANCE COSTS AND
TAXATION TO NET CASH INFLOW FROM OPERATING ACTIVITIES
Net revenue before finance costs and taxation                                 838                       896
Changes in debtors and creditors                                                 -                      (29)

Realised currency (loss)/profit                                               (29)                        100
Income tax suffered                                                           (11)                        (11)
Overseas tax suffered                                                         (36)                        (29)


NET CASH INFLOW FROM OPERATING ACTIVITIES

                                                                              762                         927

                                    HERALD INVESTMENT TRUST plc
                                                   NOTES


                                                           31 December 2004                31 December 2003
                                                                   £'000                         £'000
1.   Income


     Income from investments and interest receivable                4,759                      3,875
     Other income                                                      17                          7

2.   The proposed final dividend will be paid on 19 April 2005 to all shareholders on the register at the
     close of business on 29 March 2005.

3.   Return per ordinary share
     Revenue return                                                   301                        276
     Capital return                                                16,391                    139,949

     The basic return per ordinary share is based on the above totals of revenue and capital and on
     87,745,357 ordinary shares (2003 -86,711,829) being the weighted average number of ordinary shares in
     issue during the year.


4.   The Company currently has a 364 day US$47.35 million multi-currency loan facility with ING Bank N.V.
     which expires on 25 October 2005. At 31 December 2003 it also had a five year £3 million facility with
     the Royal Bank of Scotland plc which expired on 7 January 2004.



     At 31 December 2004 the Company had borrowings totaling £24,663,000 (US$47,350,000) (2003 -
     £29,325,000 (US$ 47,350,000 and Yen 551,550,000)).


5.   Net asset value per ordinary share is based on net assets of £336,570,000 (2003 - £320,884,000) and
     87,556,010 (2003 - 87,807,348) ordinary shares, being the number of ordinary shares in issue at each
     date.


6.   At the Annual General Meeting in April 2004 Shareholders granted the Company authority to purchase
     shares in the market up to 13,162,321 Ordinary shares (equivalent to 14.99% of its issued share
     capital at that date).  In the year to 31 December 2004, a total of 251,338 (2003 - nil) Ordinary
     shares with a nominal value of £62,835 were bought back at the total cost of £742,567 (2003 - £nil).
     At 31 December 2004 the Company had authority to buy back a further 12,910,983 Ordinary shares.  Under
     the provisions of the Company's Articles share buy-backs are funded from the realised capital reserve.
       The nominal value of the share capital is maintained by the provision of a capital redemption
     reserve.


7.   The financial statements for the year to 31 December 2004 have been prepared on the basis of the
     accounting policies set out in the Company's financial statements at 31 December 2003.



     The financial information set out above does not constitute the Company's statutory accounts for the
     year ended 31 December 2004.  The financial information for 2003 is derived from the statutory
     accounts for 2003 which have been delivered to the Registrar of Companies.  The Auditors have reported
     on the 2003 accounts, their report was unqualified and did not contain a statement under section 237
     (2) or (3) of the Companies Act 1985.  The statutory accounts for 2004 will be finalised on the basis
     of the financial information presented in this preliminary announcement and will be delivered to the
     Registrar of Companies following the Company's Annual General Meeting.






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