Interim Results

Herald Investment Trust PLC
24 July 2001

                   PRELIMINARY STOCK EXCHANGE ANNOUNCEMENT

                         HERALD INVESTMENT TRUST plc

                Results for the six months ended 30 June 2001

                                 24 July 2001

                               BOARD STATEMENT

This is Herald Investment Trust's eighth interim statement, and we have to
report a decline of 21.86% in the diluted net asset value per share. This
reflects a particularly poor UK and European performance, where the decline
exceeded 30%, offset by a small positive return from the Far East, and a
pleasingly good positive return of c10% from the US. It remains the policy to
have at least 50% of the portfolio in the UK and Europe, and the performance
has benefited from the aggressive profit taking in last year's speculative
bubble, so we had a lower proportion of the fund invested in the UK than we
have been hitherto accustomed. Whilst the unwinding of irrationally high
valuations was entirely to be expected, the scale of slow down of underlying
demand has caught us by surprise. The degree to which sales expectations have
been missed is unprecedented in the Manager's experience, although
frustratingly explicable given the euphoria last year, which influenced
customers as well as investors. Whilst the slowdown started in the first
quarter of the year in the US, anecdotally there has been a sharp downward
lurch in trading conditions for many UK companies in the second quarter, while
the major economies of Germany and Japan continue to disappoint the most.


Capital performance of the Trust from 31 December 2000 to 30 June 2001


UK Equities                         -37.4%

European Equities                   -31.5%

US Equities                          +9.6%

Other Overseas Equities              +5.6%

Whilst the UK performance is well below our benchmark indices we do draw
attention to the fact that at the end of June the basic net assets of the fund
were still 15.0% higher than the level at the end of October 1999, when the
speculative bubble began. Over that time period the FTSE-100 has fallen 9.8%,
the HGSCI, the principal benchmark is up 6.5%, the Russell 2000 Technology
Index is down 21.0%, Techmark 100 has fallen 17.6% while the FTSEIT index and
the German Neuer Markt have almost halved. In the period being reported on,
the sectors in which the investments in the fund are focussed have been
savaged.


At the start of the period Information Technology (hardware and software)
accounted for 48% of total equities and UK IT stocks accounted for 31% of
total equities. The FT index for this sector was down 50.0% in the first half,
the FT telecomms services sector was down 35.6%, and even the media sector,
which was relatively resilient, was down 26.9% . In past periods of technology
weakness the media sector has provided defensiveness- not in this environment.
The decline in the FTSE Techmark was only 30.3% reflecting the positive
performance of a number of pharmaceutical/ biotechnology stocks in which
Herald does not invest. For example the largest stock in the index is now
Shire Pharmaceuticals which was up by 22.7%, while Smith and Nephew was up by
19%. Against this background the performance of the UK element, and more
particularly the fund overall, is more satisfactory.


We cannot expect to enjoy the upside without some pain in these conditions.
During the period the fund has significantly underperformed its principal
benchmarks the HGSCI (ext cap gains), which was down 7.4%, and the Russell
2000 Technology Index which was down 11.7%, albeit only 6.2% in £ terms.


The revenue account has benefited from relatively high liquidity, and lower
costs, as the management fee is proportional to assets which are lower than
last year. The focus of the fund remains on capital growth, and as in previous
years an interim dividend will not be paid. However, there are prospects for
an increased final. As in previous years all costs are charged to revenue.


Companies are continuing to surprise on the downside, in the UK and Europe in
particular, which were later into the down cycle. We may well not have reached
the bottom yet. Part of the ferociousness of current conditions is destocking
and lengthening sales cycles. These will work through, and for the businesses
we aim to invest in there is long term demand. However, we would caution
against expecting growth rates in the IT sector for example to recover to
rates of recent years too quickly. Nevertheless, with our focus on small
companies, we are increasingly confident that there are, selectively,
opportunities for good returns. We have invested a net £10.8m in the first
half, and still have c£46m in net cash and gilts to exploit opportunities,
with the potential to gear if the market gets really oversold.

  
                                                                  Martin Boase

                                                                      Chairman

                                                                  23 July 2001


Statistics and Performance Report

                                                      Performance
                                                            since
                                    At       At    At               Performance
                             inception                31 December         since
                                             31    30                 inception
                                    16 December  June        2000
                              February     2000
                                  1994           2001
Basic NAV per share               98.7p  447.5p     346.6p -22.5%       +251.2%
Diluted NAV (FRS14)               98.7p  431.4p     337.3p -21.8%       +241.7%
Fully diluted NAV per share       98.7p  432.0p     337.2p -21.9%       +241.6%
Share price                       90.9p  491.0p     324.5p -33.9%       +257.0%
Warrant price                     45.5p  382.5p     217.5p -43.1%       +378.0%
FTSE 100 Index                  3,417.7 6,222.5    5,642.5  -9.3%        +65.1%
HGSC Index (ext. cap gains      1,750.0 2,702.2    2,503.0  -7.4%        +43.0%
ex investment co's)
Russell 2000 (small cap)          83.2*  128.3       120.3  -6.2%        +44.6%
Technology Index (in
sterling terms)

* 9 April 1996, being the date funds were first available for
international investment

                                   - ends -


For further information please contact:

Ms Katie Potts, Manager

Herald Investment Trust plc                              020 7553 6300



Baillie Gifford & Co.

Secretaries                                              0131 222 4000



                         HERALD INVESTMENT TRUST plc

The following is the unaudited preliminary statement for the six months to 30
June 2001 which has been neither reviewed nor audited by the auditors. This
statement is being printed and will be sent to all shareholders on 3 August
2001. Copies will be available for inspection at the Registered Office of the
Company or may be obtained on request from the Managers or Secretaries after
that date.

                          STATEMENT OF TOTAL RETURN

              (unaudited and incorporating the revenue account*)
                               For the six months          For the six months
                                      ended                       ended

                                  30 June 2001                30 June 2000

                              Revenue Capital Total       Revenue Capital Total

                              £'000   £'000   £'000       £'000   £'000   £'000
(Losses)/gains on investments -       (84,324) (84,324)   -       46,792  46,792
Unrealised gain/(loss) on     -       88      88          -       (100)   (100)
loan
Currency gain                 -       2       2           -       42      42

Income                        2,957   -       2,957       3,308   -       3,308
Investment management fee     (1,787) -       (1,787)    (2,795)  -      (2,795)
Other administrative expenses (137)   -       (137)       (246)   -       (246)
Net return before finance     1,033   (84,234)(83,201)    267     46,734  47,001
costs and taxation
Finance costs of borrowings   (39)    -       (39)        (44)    -       (44)
Return on ordinary activities 994     (84,234)(83,240)    223     46,734  46,957
before taxation
Tax on ordinary activities    (18)    -       (18)        (20)    -       (20)

Return on ordinary activities 976     (84,234)(83,258)    203     46,734  46,937
after taxation
Transfer to/(from) reserves   976     (84,234)(83,258)    203     46,734  46,937
Return per Ordinary share
(note 1)
Basic                         1.16p (100.20p) (99.04p)    0.24p   56.12p  56.36p
Diluted                       1.12p   (96.77p) (95.65p)   0.23p   53.71p  53.94p


* 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 30 June 2001

                                 (unaudited)
                                                  30 June          31 December

                                                     2001              2000
                                                  £'000             £'000
NET ASSETS                                        284,478           365,575

Investments at market value
Net current assets                                11,363            13,032
Total assets (before deduction of bank            295,841           378,607
loan)
Overseas currency loan (note 2)                   (3,145)           (3,233)
TOTAL NET ASSETS                                  292,696           375,374
CAPITAL AND RESERVES
Called-up share capital                           21,113            20,968
Other reserves                                    268,895           352,694
Revenue reserve                                   2,688             1,712
EQUITY SHAREHOLDERS' FUNDS                        292,696           375,374

Net asset value per ordinary share (note 3)
Basic                                             346.58p           447.55p
Diluted (FRS14)                                   337.31p           431.43p
Fully diluted                                     337.16p           431.98p

Ordinary shares in issue (note 4)                 84,453,686        83,873,599



                         HERALD INVESTMENT TRUST plc

                            DISTRIBUTION OF ASSETS

                               at 30 June 2001

                                 (unaudited)

                                                     30 June        31 December

                                                     2001           2000

                                                        %                %
Equities: United Kingdom                             47.4            55.7
Continental Europe                                   6.7             7.2
Americas                                             24.2            16.6
Japan                                                0.9             0.6
Asia Pacific                                         4.3             4.5
                                                     83.5            84.6
UK bonds                                             12.7            12.0
Net liquid assets                                    3.8             3.4
Total assets (before deduction of bank loan)         100.0           100.0


                         HERALD INVESTMENT TRUST plc
                        SUMMARISED CASH FLOW STATEMENT

                                  (unaudited)
                                               Six months to       Year to

                                               30 June 2001   31 December 2000
                                              £'000  £'000       £'000   £'000
NET CASH INFLOW FROM OPERATING ACTIVITIES            901                 348
NET CASH OUTFLOW FROM SERVICING OF FINANCE           (41)                (83)
TOTAL TAX RECOVERED                                  54                  -
FINANCIAL INVESTMENT
Purchase of investments                      (40,689)         (212,244)
Sale of investments                          39,681            196,392
Currency movement                            2                79
NET CASH OUTFLOW FROM FINANCIAL INVESTMENT           (1,006)            (15,773)
EQUITY DIVIDEND PAID                                 (713)              (705)
NET CASH OUTFLOW BEFORE USE OF LIQUID                (805)              (16,213)
RESOURCES AND FINANCING
MANAGEMENT OF LIQUID RESOURCES+
Decrease/(increase) in term deposits                 4,000               (4,000)
FINANCING
Issue of Ordinary shares                             580                 912

INCREASE/(DECREASE) IN CASH                          3,775              (19,301)
RECONCILIATION OF NET CASH FLOW TO MOVEMENT
IN NET FUNDS
Increase/(decrease) in cash in period                3,775              (19,301)
(Decrease)/increase in short term investments        (4,000)               4,000
Exchange movement                                    88                  110
MOVEMENT IN NET FUNDS IN PERIOD                      (137)              (15,191)
NET FUNDS AT 1 JANUARY                               8,997               24,188
NET FUNDS AT 30 JUNE/31 DECEMBER                     8,860               8,997


+ The Company includes as liquid resources term deposits of less than one
year.



                         HERALD INVESTMENT TRUST plc

                                    NOTES

 1. The basic return per Ordinary share calculations are based on a weighted
    average number of shares in issue during each period. For the period to 30
    June 2001, the weighted average number of Ordinary shares was 84,068,024
    (30 June 2000 - 83,267,327).

    The diluted returns per Ordinary share have been calculated on the
    weighted average warrants in issue during the period adjusted by the
    difference between the average price of the Ordinary shares during the
    period and the Subscription price of 100p, giving a weighted average of
    87,045,201 (30 June 2000 - 87,015,024) shares.

    There were 3,353,663 warrants in issue at 30 June 2001 (30 June 2000 -
    3,933,750).

 2. The overseas currency loan of Yen 551,550,000 becomes due for repayment on
    7 January 2004.


 3. The diluted net asset value per ordinary share has been calculated in
    accordance with FRS 14 'Earnings per share'. The calculation determines
    the potential number of dilutive shares which would be issued on the
    exercise of warrants by reference to the share price (fair value) at each
    period end.


    The fully diluted net asset value per ordinary share has been calculated
    on the assumption that the 3,353,663 warrants in issue at 30 June 2001 (31
    December 2000 - 3,933,750) were fully exercised at 100p at each period
    end.


 4. During the period 580,087 ordinary shares were issued in respect of
    warrants exercised on 30 April 2001. Each warrant entitles the holder to
    subscribe for one ordinary share at 100p on 30 April in either of the
    remaining years 2002 and 2003.

    At the AGM on 18 April 2001 the Company's authority to buy back shares was
    renewed in respect of 12,572,652 ordinary shares. No shares have been
    bought back during the period.


 5. The financial information for the year ended 31 December 2000 has been
    extracted from the full accounts, which have been filed with the Registrar
    of Companies and which contain an unqualified Auditor's Report.

 6. The accounting policies applied in calculating the interim figures are
    consistent with those used in the Annual Financial Statements.

 7. The Interim Report was approved by the Board on 23 July 2001.