Interim Results

Herald Investment Trust PLC
23 July 2004



                    PRELIMINARY STOCK EXCHANGE ANNOUNCEMENT

                         HERALD INVESTMENT TRUST plc

                 Results for the six months ended 30 June 2004

                               23 July 2004

                              BOARD STATEMENT

                            CHAIRMAN'S STATEMENT



The Trust targets the IT, media and communications sectors, which recovered last
year from an oversold position. Following the rise in the Trust's fully diluted
net asset value of 77% in 2003 this half year has seen a period of wholesome
consolidation and more modest progress. Overall the net assets have risen 5.6%.
In general progress in the figures reported by the companies in the portfolio
has been very strong, but this was in part discounted in the rally last year,
and sentiment has been adversely affected by macro concerns such as interest
rate and oil price rises in spite of the strong fundamentals. Although the fund
was geared throughout last year, it was only 103% invested at the start of 2004,
and through profit taking had modest net cash by early February. Encouraged by
the strong reporting season the Manager has subsequently not raised further
cash, as was originally planned.

Total return by geography of the Trust from 31 December 2003 to 30 June 2004

UK Equities                                                   +11.0%
US Equities                                                    -8.9%
European Equities                                             +10.5%
Far East Equities                                              -7.6%

The capital return was 5.6% in the first half. The total return of the HGSCI was
+10.6% over the same period, which is similar to the UK portfolio within the
Trust, albeit the weighted average of the sectors most relevant to the Trust
within the index was up only just by 0.61%. The FTSE-Techmark 100 was +15.3%,
but the performance was heavily enhanced by biotechnology and healthcare stocks
which Herald does not invest in. In contrast the FTSE-IT index was down 5.2%.
The US portfolio decline was similar to the Russell 2000 Technology Index (-6.1%
in US$), which is the most relevant benchmark.  The US was a materially lower
proportion of the fund than in previous years. Generally trading performances
were strong, but the market is nervous that further trading improvements will be
more difficult. The European portfolio is small, but performed satisfactorily
with local returns of 15.6%, reduced by the weak Euro which reduced the return
to 10.5%. The Far East portfolio declined 7.6%; a positive Japanese return had a
minor impact due to the low weighting. This reflects the difficulties in
analysing small companies in Japan.

As in previous years an interim dividend will not be paid.

Although there have been strong trading improvements in general, there has been
a flood of paper offerings from new issues, particularly in the UK, and an
unusually small number of takeovers. This reflects a backlog of demand following
a period when the market was effectively closed, and the excessive financial
incentive brokers have to place new stock versus secondary stock. The quality of
many of these offerings is not terribly high, and the flow will abate as
investors weary. The regulatory environment in the US and the UK which precludes
analysts from operating both sides of the Chinese walls, is leaving many small
companies increasingly under researched. On balance this will lead to more
market inefficiencies which we should be in a good position to exploit. It has
become conspicuous that at the current US$ exchange rate UK executive salaries
of the companies in which the Trust invests have become surprisingly high
relative to the US, and even more so compared with the Far East. With
unemployment low, and house prices high, the UK has become a less competitive
place in which to operate. Although the UK has risen to 69% of the net assets,
the intention will be to reduce this exposure in the coming months. There is no
longer the requirement to have at least 50% of the fund's assets in the UK and
Europe.

Enthusiasm for the internet may have become irrational in 2000. Nevertheless
usage is showing robust growth as the roll-out of broadband proceeds. Consumer
demand has remained robust in the first half utilising most of the world's
semiconductor capacity. There has been a strong upturn in capital expenditure in
this area, but enterprise software remains, as expected, subdued. More than ever
stock selection remains the key. There continue to be interesting small
companies thriving in emerging markets.


M Boase
Chairman
22 July 2004



Statistics and Performance Report

                                                                              Performance
                           At inception               At               At           since      Performance
                        16 February 1994     31 December          30 June     31 December  since inception
                                                    2003             2004            2003
                                                                     
NAV per share                      98.7p          365.4p           385.9p            5.6%           291.0%

Share price                        90.9p          325.3p           315.8p          (2.9%)           247.4%

FTSE 100 Index                   3,417.7         4,476.9          4,464.1          (0.3%)            30.6%

HGSC Index (ext. cap             1,750.0         2,346.7          2,560.3            9.1%            46.3%
gains ex. investment
companies)

Russell 2000 (small                83.2*            72.9             67.6          (7.3%)          (18.8%)
cap) Technology Index
(in sterling terms)


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

Past performance is no guarantee of future performance.



                                    - ends -



For further information please contact:

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

Baillie Gifford & Co.
Secretaries                                                        0131 275 2000






                          HERALD INVESTMENT TRUST plc

The following is the unaudited preliminary statement for the six months to 30
June 2004 which has been neither reviewed nor audited by the auditors.  This
statement is being printed and will be sent to all shareholders on 2 August
2004.  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 2004                     30 June 2003                  31 December 2003
                           Revenue    Capital Total         Revenue    Capital     Total     Revenue   Capital     Total
                             £'000      £'000 £'000       £'000          £'000     £'000       £'000     £'000     £'000

Gains on investments            -      17,500   17,500           -     53,931    53,931           -    136,680  136,680
Unrealised gains on loans       -         215      215           -      1,021     1,021           -      3,169    3,169
Currency gains                  -         174      174           -          -         -           -        100      100

Income                      2,375           -    2,375       1,772          -     1,772       3,882          -    3,882
Investment management fee  (1,905)          -   (1,905)     (1,069)         -    (1,069)     (2,727)         -   (2,727)
Other administrative         (129)          -     (129)       (130)         -      (130)       (259)         -     (259)
expenses
Net return before finance     341      17,889   18,230         573     54,952    55,525         896    139,949  140,845
costs and taxation

Finance costs of borrowings  (232)          -     (232)       (282)         -      (282)       (591)         -     (591)
Return on ordinary            109      17,889   17,998         291     54,952    55,243         305    139,949  140,254
activities before taxation

Tax on ordinary activities    (30)          -      (30)        (18)         -       (18)        (29)         -      (29)

Return on ordinary             79      17,889   17,968         273     54,952    55,225         276    139,949  140,225
activities after taxation                                                           

Ordinary dividend payable       -           -        -           -          -         -        (263)         -     (263)
(note 2)
Transfer to reserves           79      17,889   17,968         273     54,952    55,225          13    139,949  139,962
Return per Ordinary share
(note 3)

Basic                       0.09p      20.37p    20.46p       0.32p     64.20p    64.52p       0.32p   161.39p   161.71p
Diluted (FRS14)             0.09p                             0.32p                            0.32p
Dividend per Ordinary           -                                 -                            0.30p
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
                                                                  2004              2003
                                                                 £'000             £'000                £'000
NET ASSETS
Investments at market value                                   334,088           258,023              331,497
Net current assets                                             30,874             9,413               18,712
Total assets (before deduction of bank loans)                 364,962           267,436              350,209
Bank loans (note 4)                                           (26,110)          (31,289)             (29,325)
TOTAL NET ASSETS                                              338,852           236,147              320,884

CAPITAL AND RESERVES
Called-up share capital                                        21,952            21,952               21,952
Share premium                                                  73,738            73,738               73,738
Capital reserve - realised                                    195,895           178,134              182,463
Capital reserve - unrealised                                   45,127           (39,998)              40,670
Revenue reserve                                                 2,140             2,321                2,061
EQUITY SHAREHOLDERS' FUNDS                                    338,852           236,147              320,884

Net asset value per ordinary share                             385.90p           268.94p              365.44p

Ordinary shares in issue (note 5)                           87,807,348        87,807,348           87,807,348




                              DISTRIBUTION OF ASSETS
                                  (unaudited)

                                                                 30 June          30 June         31 December
                                                                    2004             2003                2003
                                                                       %                %                   %

Equities:              United Kingdom                               63.9             65.2                63.4
                       Continental Europe                            6.2              5.2                 6.0
                       Americas                                     14.2             17.7                17.8
                       Japan                                         0.9              0.4                 0.6
                       Asia Pacific                                  6.4              8.0                 6.9
                                                                    91.6             96.5                94.7
Net liquid assets                                                    8.4              3.5                 5.3
Total assets (before deduction of bank loans)                      100.0            100.0               100.0







                            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 2004      30 June 2003       31 December
                                                                                                       2003
                                                                  £'000             £'000             £'000

NET CASH INFLOW FROM OPERATING ACTIVITIES                          240               501               827

NET CASH OUTFLOW FROM SERVICING OF FINANCE                        (265)             (249)             (580)

FINANCIAL INVESTMENT
Purchase of investments                                        (39,020)          (37,145)          (77,543)
Sale of investments                                             52,993            23,880            74,274
Currency movement                                                   23                 -               100

NET CASH INFLOW/(OUTFLOW) FROM FINANCIAL INVESTMENT             13,996           (13,265)           (3,169)

EQUITY DIVIDEND PAID                                              (263)             (718)             (718)

NET CASH INFLOW/(OUTFLOW) BEFORE  FINANCING                     13,708           (13,731)           (3,640)

FINANCING
Issue of Ordinary shares                                             -             3,332             3,332
Loans drawn down                                                     -            10,000            37,902
Loans repaid                                                    (2,849)                 -          (27,718)
NET CASH (OUTFLOW)/INFLOW FROM FINANCING                        (2,849)           13,332            13,516


INCREASE/(DECREASE) IN CASH                                     10,859              (399)            9,876

RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET (DEBT)
/FUNDS
Increase/(decrease) in cash in period                           10,859              (399)            9,876
Decrease/(increase) in bank loans                                2,849           (10,000)          (10,184)
Exchange movement on loans                                         366             1,021             3,169

MOVEMENT IN NET (DEBT)/ FUNDS IN PERIOD                         14,074            (9,378)            2,861

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

                                                                                 
NET FUNDS/(DEBT) AT 30 JUNE/31 DECEMBER                          3,388           (22,925)          (10,686)





                              HERALD INVESTMENT TRUST plc

                                         NOTES

     
1.   The Financial Statements for the six months to 30 June 2004 have been 
     prepared on the basis of the accounting policies set out in the Company's 
     Annual Financial Statements at 31 December 2003.  The Interim Report was 
     approved by the Board on 22 July 2004.

     None of the views expressed in this document should be construed as advice 
     to buy or sell a particular investment.


2.   No interim dividend will be declared.

                                         Six months ended          Six months ended               Year ended
                                             30 June 2004              30 June 2003         31 December 2003
                                                    £'000                     £'000                    £'000
3.   Return per ordinary share
     Revenue return                                    79                       273                      276
     Capital return                                17,889                    54,952                  139,949
                                                                                              

     The basic return per Ordinary share is based on the above totals of revenue 
     and capital and on 87,807,348 ordinary shares (30 June 2003 - 85,598,153 
     and 31 December 2003 - 86,711,829) being the weighted average number of 
     ordinary shares in issue during each period.

     There is no dilution effect on the return per Ordinary share in the period 
     to 30 June 2004 as all outstanding warrants had been exercised by 30 April 
     2003.  For the periods to 30 June and 31 December 2003, the diluted return 
     per Ordinary share was calculated using the weighted average number of 
     warrants in issue during these periods adjusted by the difference between 
     the average price of the Ordinary shares during the period, 30 June 2003 - 
     186.9p and 31 December 2003 - 244.3p, and the Subscription price of 100p to 
     give a weighted average of 30 June 2003 - 86,625,581 and 31 December 2003
     - 87,358,935 shares.


 4.  The Company has arranged multi-currency loan facilities with The Royal Bank 
     of Scotland plc and ING Bank N.V.   The facility with The Royal Bank of 
     Scotland plc comprised a five year £3 million facility which expired on 7 
     January 2004.  The ING Bank N.V. facility comprises a 364 day £30 million 
     facility which expires on 26 October 2004.  At 30 June 2004 there were 
     outstanding drawings of US$47.35 million (30 June 2003 - US$47.038 million 
     and Y551.55 million and at 31 December 2003 - US$47.35 million and Y
     551.55 million).


 5.  At the AGM held on 14 April 2004 the Company's authority to buy back shares 
     was renewed in respect of 13,162,321 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 2004 the Company's authority to 
     buy back shares remains unchanged at 13,162,321.


 6.  The financial information for the year ended 31 December 2003 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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