Interim Results

Herald Investment Trust PLC
24 July 2003



                     PRELIMINARY STOCK EXCHANGE ANNOUNCEMENT


                          HERALD INVESTMENT TRUST plc

                 Results for the six months ended 30 June 2003

                                23 July 2003


                              BOARD STATEMENT

                            CHAIRMAN'S STATEMENT

The Trust targets the IT, media and communications sectors, which peaked
dramatically in March 2000, and have subsequently fallen precipitously. However
our Manager believed that the correction had been overdone and that September
and October 2002 provided an outstanding buying opportunity.  This led to the
fund becoming fully invested at that time, having had c£43m net cash at the
start of 2002.  Furthermore at the October 2002 Trust board meeting the board
approved a £20m multi-currency loan, which was drawn down in US$ at an interest
rate of 2.1% for a year. Although there was a useful rally in the Autumn the
first quarter was poor with the assets declining 8% reflecting the macro
economic/Gulf war concerns seen throughout the market. This provided an
opportunity to gear the fund further, with the Manager drawing down the US$
equivalent of an additional £10m at 1.85% following the AGM in April. However,
although the assets dropped to £163m at the end of March, this was around 10%
higher than the October low. Furthermore market liquidity was desperately
lacking, and stock was difficult to buy in the required size in March and April,
and the Manager struggled to invest the proceeds of four cash bids received in
February followed by the borrowed funds. The market rallied strongly in the
second quarter when the basic NAV per share grew 39%. While it was definitely a
buyers market in September and October, the market is now seeing healthy two way
business.

Total return by geography of the Trust from 31 December 2002 to 30 June 2003

UK Equites                     +31.52%
US Equities                    +26.27%
European Equities              +13.68%
Far East Equities              +10.48%

The fully diluted NAV per share rose 30.5% in the first half. The UK performed
well ahead of the relevant indices. The total return of the Hoare Govett Smaller
Companies Index was +19.2% over the same period, albeit the weighted average of
the sectors most relevant to the Trust within the index was 21.4%, and the
FTSE-Techmark 100 was +21.1%. The performance benefited from significant stakes
in three of the four best performing stocks in Techmark - Gresham Computing,
Amstrad and Imagination - albeit no single stock contributed as much as 3% of
the overall 30.5% growth in the Trust. It is particularly pleasing that this
outperformance of the sectors in the UK in a rising market was nearly as much as
the outperformance in last year's declining markets. The US also performed well
with a return of 26.3% in £; the US$ declined by 2.5% but this was cushioned by
the US$ debt. The Russell 2000 Technology Small Companies Index grew 23.0% (in
£), whereas the large company equivalent grew only 14.2%, and Nasdaq grew 18.5%.
Valuations in the US were and remain superficially higher, but there is a high
level of operational gearing to sales volumes, and the economy seems more robust
than elsewhere. The European portfolio is small, and underperformed the Trust
overall with local returns of 9.9%, but benefited from the strong Euro which
increased the return to 13.7%. The economic background in Europe remains
difficult. The Far East performance was relatively disappointing with our
holdings skewed to economies affected by SARS.

The outstanding warrants were exercised in April. There was a 93% take up with
the residue being placed. The equity will suffer from no further dilution. As in
previous years an interim dividend will not be paid. In recent years significant
revenues have come from gilt and interest income.  Now that the fund is fully
invested this is no longer the case and, of course, interest rates are very low
anyway.

The outstanding anomalies in valuation have unfortunately disappeared, as the
irrational pessimism of the Autumn has changed to a more normal market. Further
good performance is still probable, but should be based on companies making
solid progress. This will not occur across the board while the major economies
remain sluggish, but it is encouraging that the number of earnings surprises on
the upside have exceeded disappointments in the recent past, and corporate
capital expenditure is certainly at a sub-normal level. There is also evidence
that some investors are worried about being underexposed to the Trust's area,
and weight of money could again drive valuations to unexpected levels. The fund
has outperformed the FTSE-100 by 28% in the first half and in a low growth
competitive world niche small companies may still offer the best potential.


Martin Boase
Chairman
23 July 2003


Statistics and Performance Report

                                                                              Performance
                                                                                    since      Performance
                        16 February 1994     31 December          30 June     31 December  since inception
                                                    2002             2003            2002                
                                                                     
Basic NAV per share               98.7p+          210.2p           268.9p           27.9%           172.4%
Diluted NAV (FRS14)               98.7p+          206.7p           268.9p           30.1%           172.4%
Fully diluted NAV per             98.7p+          206.0p           268.9p           30.5%           172.4%
share
Share price                        90.9p          177.0p           237.5p           34.2%           161.3%
Warrant price                      45.5p           79.0p                -               -                -
FTSE 100 Index                   3,417.7         3,940.4          4,031.2            2.3%            18.0%
HGSC Index (ext. cap             1,750.0         1,693.9          1,981.9           17.0%            13.3%
gains ex. investment
companies)
Russell 2000 (small                83.2*            49.6             61.0           23.0%          (26.7%)
cap) Technology Index
(in sterling terms)


+ 100.0p is shareholders' subscription price before launch costs of 1.3p.

* 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 2003 which has been neither reviewed nor audited by the auditors.  This
statement is being printed and will be sent to all shareholders on 1 August
2003.  Copies will be available for inspection at the Registered Office of the
Company or may be obtained on request from the Manager or Secretary after that
date.

                                                  STATEMENT OF TOTAL RETURN
                                      (unaudited and incorporating the revenue account*)


                 For the six months ended            For the six months ended               For the year ended
                       30 June 2003                        30 June 2002                      31 December 2002
                Revenue    Capital     Total       Revenue    Capital      Total       Revenue    Capital      Total
                  £'000      £'000     £'000         £'000      £'000      £'000         £'000      £'000      £'000

Gains/(losses)        -     53,931    53,931             -    (58,491)   (58,491)            -    (95,509)   (95,509)
on
investments
Unrealised            -      1,021     1,021             -       (127)      (127)            -        582        582
gains/(losses)
on loans
Currency              -          -         -             -        (30)       (30)            -       (146)      (146)
losses
Income            1,772          -     1,772         1,884          -      1,884         3,539          -      3,539
Investment       (1,069)         -    (1,069)       (1,413)         -     (1,413)       (2,470)         -     (2,470)
management
fee
Other              (130)         -      (130)         (129)         -       (129)         (262)         -       (262)
administrative
expenses
Net return          573     54,952    55,525           342    (58,648)   (58,306)          807    (95,073)   (94,266)
before finance
costs and
taxation
Finance costs      (282)         -      (282)          (37)         -        (37)         (149)         -       (149)
of
borrowings
Return on           291     54,952    55,243           305    (58,648)   (58,343)          658    (95,073)   (94,415)
ordinary
activities
before
taxation
Tax on              (18)         -       (18)          (24)         -        (24)          (31)         -        (31)
ordinary
activities
Return on           273     54,952    55,225           281    (58,648)   (58,367)          627    (95,073)   (94,446)
ordinary
activities
after
taxation
Ordinary              -          -         -             -          -          -          (718)         -       (718)
dividend
payable (note
2)
Transfer to/        273     54,952    55,225           281    (58,648)   (58,367)          (91)   (95,073)   (95,164)
(from)
reserves
Return per
Ordinary share
(note 3)
Basic              0.32p     64.20p    64.52p         0.33p    (69.44p)   (69.11p)        0.74p   (112.55p)  (111.81p)
Diluted            0.32p                              0.32p                               0.73p
(FRS14)
Dividend per          -                                  -                                0.85p
Ordinary
Share

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

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

                          HERALD INVESTMENT TRUST plc
                                        
                            SUMMARISED BALANCE SHEET
                                  (unaudited)
                                         


                                           30 June       30 June   31 December                                          
                               
                                              2003          2002          2002
                                             £'000         £'000         £'000
NET ASSETS
Investments at market value                258,023       212,808       191,988
Net current assets                           9,413         4,598         7,912
Total assets (before deduction of bank     267,436       217,406       199,900
loans)
Bank loans (note 4)                        (31,289)       (3,019)      (22,310)
TOTAL NET ASSETS                           236,147       214,387       177,590

CAPITAL AND RESERVES

Called-up share capital                     21,952        21,119        21,119
Share premium                               73,738        69,723        69,723
Warrant reserve                                  -         1,516         1,516
Capital reserve - realised                 178,134       203,571       186,381
Capital reserve - unrealised               (39,998)      (83,962)     (103,197)
Revenue reserve                              2,321         2,420         2,048
EQUITY SHAREHOLDERS' FUNDS                 236,147       214,387       177,590


Net asset value per ordinary share
(note 5)
Basic                                       268.94p       253.79p       210.23p
Diluted (FRS14)                             268.94p       248.55p       206.68p
Fully diluted                               268.94p       247.95p       206.04p

Ordinary shares in issue (note 6)       87,807,348    84,475,145    84,475,145


                             DISTRIBUTION OF ASSETS                                        
                                  (unaudited)

                                             30 June    30 June    31 December
                                                2003       2002           2002
                                                   %          %              %

Equities: United Kingdom                        65.2       55.6           62.9
Continental Europe                               5.2        7.3            6.4
Americas                                        17.7       17.4           18.2
Japan                                            0.4        0.6            0.5
Asia Pacific                                     8.0        7.4            8.0
                                                96.5       88.3           96.0
UK bonds                                           -        9.6              -
Net liquid assets                                3.5        2.1            4.0
Total assets (before deduction of bank         100.0      100.0          100.0
loans)


                          HERALD INVESTMENT TRUST plc
                                        
                         SUMMARISED CASH FLOW STATEMENT
                                  (unaudited)


                                For the six          For the six  For the year
                               months ended        months ended          ended
                               30 June 2003        30 June 2002    31 December 
                                                                          2002    
                                      £'000              £'000           £'000

NET CASH INFLOW FROM                    501                275             790
OPERATING ACTIVITIES
NET CASH OUTFLOW FROM                  (249)               (36)            (84)
SERVICING OF FINANCE
FINANCIAL INVESTMENT
Purchase of investments             (37,145)           (56,046)        (99,858)
Sale of investments                  23,880             42,733          69,514
Currency movement                         -                (30)           (146)
NET CASH OUTFLOW FROM               (13,265)           (13,343)        (30,490)
FINANCIAL INVESTMENT
EQUITY DIVIDEND PAID                   (718)              (718)           (718)
NET CASH OUTFLOW BEFORE             (13,731)           (13,822)        (30,502)
FINANCING
FINANCING
Issue of Ordinary shares              3,332                 22              22
Loans drawn down                     10,000                  -          20,000
NET CASH INFLOW FROM                 13,332                 22          20,022
FINANCING

DECREASE IN CASH                       (399)           (13,800)        (10,480)
RECONCILIATION OF NET CASH
FLOW TO MOVEMENT IN NET
(DEBT)/FUNDS
Decrease in cash in period             (399)           (13,800)        (10,480)
Increase in bank loans              (10,000)                 -         (20,000)
Exchange movement on loans            1,021               (127)            582
MOVEMENT IN NET (DEBT)/ FUNDS        (9,378)           (13,927)        (29,898)
IN PERIOD
NET (DEBT)/FUNDS AT 1               (13,547)            16,351          16,351
JANUARY
NET (DEBT)/FUNDS AT 30 JUNE/        (22,925)             2,424         (13,547)
31 DECEMBER

                          HERALD INVESTMENT TRUST plc
                                        
                                      NOTES

 1.  The accounting policies applied in calculating the interim figures are
     consistent with those used in the Annual Financial Statements. The Interim
     Report was approved by the Board on 23 July 2003.

 2.  No interim dividend will be declared.

                                  Six months         Six months     Year ended
                                     ended              ended      31 December
                              30 June 2003       30 June 2002             2002 
                                     £'000              £'000            £'000
 3.  Return per ordinary
     share
     Revenue return                    273                281              627
     Capital return                 54,952            (58,648)         (95,073)

     The basic return per ordinary share is based on the above totals of revenue
     and capital and on 85,598,153 ordinary shares (30 June 2002 - 84,460,918,
     31 December 2002 - 84,468,090) being the weighted average number of
     ordinary shares in issue during each period.

     The diluted return per ordinary share is calculated on the above totals of
     revenue and capital and using the weighted average number of warrants in
     issue during the period adjusted by the difference between the average
     price of the ordinary shares during the period (186.9p (30 June 2002 -
     269.1p, 31 December 2002 - 221.6p)) and the subscription price of 100p, to
     give a weighted average of 86,107,645 (30 June 2002 - 86,563,625, 31
     December 2002 - 86,300,599) shares.

 4.  The Company has arranged multi-currency loan facilities with The Royal Bank
     of Scotland plc. These comprise a 364 day £30 million facility which
     expires on 31 October 2003 and a five year £3 million facility which
     expires on 7 January 2004. At 30 June 2003 there were outstanding drawings
     of US$47,038,000 and yen 551,550,000 and under these facilities (30 June
     2002 - yen 551,550,000, 31 December 2002 - US$31,268,000 and yen
     551,550,000).

 5.  Net asset value per ordinary share is based on net assets of £236,147,000
     (30 June 2002 - £214,387,000, 31 December 2002 - £177,590,000) and
     87,807,348 (30 June 2002 and 31 December 2002 - 84,475,145) ordinary
     shares, being the number of ordinary shares in issue at each date.

     The diluted net asset value per ordinary share has been calculated in
     accordance with Financial Reporting Standard 14 (FRS 14). The calculation
     is based on net assets and the number of ordinary shares in issue at the
     period end plus the notional number of ordinary shares that would have been
     issued for no consideration using the share price (fair value) (237.5p (30
     June 2002 - 214.5p, 31 December 2002 - 177.0p)) at each period end.

     The fully diluted net asset value per ordinary share has been calculated on
     the assumption that the 3,332,203 warrants in issue at 30 June 2002 and 31
     December 2002 were fully exercised at 100p at each period end.

     At 30 June 2003 there were no outstanding warrants and hence no dilution
     under either method.



                          HERALD INVESTMENT TRUST plc
                                        
                                  NOTES (Ctd)
                                        

 6.  During the period 3,332,203 ordinary shares were issued in respect of
     warrants exercised on
     30 April 2003. Each warrant entitled the holder to subscribe for one
     ordinary share at 100p on 30 April in any of the years 1995 to 2003. 30
     April 2003 was the final date for the exercise of the warrants.

     There were no warrants in issue at 30 June 2003 (30 June 2002 and 31
     December 2002 - 3,332,203).

     At the AGM held on 16 April 2003 the Company's authority to buy back shares
     was renewed in respect of 12,662,824 ordinary shares (equivalent to 14.99%
     of its issued share capital at that date). No shares have been bought back
     during the period and therefore at 30 June 2003 the Company's authority to
     buy back shares remained unchanged at 12,662,824.

 7.  The financial information for the year ended 31 December 2002 has been
     extracted from the full accounts, which have been filed with the Registrar
     of Companies and which contain an unqualified Auditors' Report.


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