Interim Results

SchroderJapan Growth Fund PLC
30 March 2006












                                                                  30  March 2006



Press Release



                           Unaudited Interim Results





The Directors of Schroder Japan Growth Fund plc announce the unaudited interim
results for the six months ended 31 January 2006.


                                                 For the six months ended          For the six months ended

                                                          31 January 2006                   31 January 2005
                                                                                                 (Restated)
                                            Revenue    Capital      Total     Revenue    Capital      Total
                                              £'000      £'000      £'000       £'000      £'000      £'000
Gains on investments                              -     37,541     37,541           -      3,036      3,036
Realised exchange rate (losses)/gains             -      (135)      (135)           -        135        135
Unrealised exchange gains/(losses) on             -      1,287      1,287           -      (765)      (765)
the loan facility
Income                                          844          -        844         680          -        680
Investment management fee                     (849)          -      (849)       (644)          -      (644)
Administrative expenses                       (170)          -      (170)       (225)          -      (225)
Net (loss)/return before finance              (175)     38,693     38,518       (189)      2,406      2,217
costs, taxation and gain on  expiry of
warrants
Interest payable                               (56)          -       (56)        (77)          -       (77)
Net (loss)/return on ordinary                 (231)     38,693     38,462       (266)      2,406      2,140
activities before taxation
Tax on ordinary activities                     (58)          -       (58)        (47)          -       (47)
Net (loss)/return attributable to             (289)     38,693     38,404       (313)      2,406      2,093
equity shareholders
Net (loss)/return per ordinary              (0.23)p     30.95p     30.72p     (0.25)p      1.93p      1.68p
share-pence










Reconciliation of Movements in Shareholders' Funds


                             Share       Share        Share        Warrant      Capital      Revenue
                             capital     premium      purchase     exercise     reserve      reserve
                                         account      reserve      reserve
                             £'000       £'000        £'000        £'000        £'000        £'000
Balance at 31 July  2005     12,501      7            97,205       3            17,108       (7,381)
Net profit from operating    -           -            -            -            38,693         (289)
activities
Realised gain on expiry of   -           -            -            -            -            -
warrants
Issue of shares on exercise  -           -            -            -            -            -
of warrants


Balance at 31 January 2006   12,501      7            97,205       3            55,801       (7,670)












                           Share      Share       Share       Warrant     Warrant     Capital     Revenue
                           capital    premium     purchase    exercise    reserve     reserve     reserve
                                      account     reserve     reserve
                           £'000      £'000       £'000       £'000       £'000       £'000       £'000
Balance at 31 July  2004   12,500     3           97,205      1           9,639       (907)       (7,182)
Net profit from operating  -          -           -           -           -           2,406       (313)
activities
Realised gain on expiry of -          -           -           -           (9.637)     9,637       -
warrants
Issue of shares on         1          4           -           2           (2)         -           -
exercise of warrants


Balance at 31 January 2005 12,501     7           97,205      3           -           11,136      (7,495)










                           Share      Share       Share       Warrant     Warrant     Capital     Revenue
                           capital    premium     purchase    exercise    reserve     reserve     reserve
                                      account     reserve     reserve
                           £'000      £'000       £'000       £'000       £'000       £'000       £'000
Balance at 31 July  2004   12,500     3           97,205      1           9,639       (907)       (7,182)
Net profit from operating  -          -           -           -           -           8,378       (199)
activities
Realised gain on expiry of -          -           -           -           (9,637)     9,637       -
warrants
Issue of shares on         1          4           -           2           (2)         -           -
exercise of warrants


Balance at 31 July 2005    12,501     7           97,205      3           -           17,108      (7,381)










                                                                 Six months ended        Six months ended
                                                                  31 January 2006         31 January 2005

                                                                                                 restated
Abridged Cash Flow Statement                                                £'000                   £'000

Net cash outflow from operating activities                                  (158)                   (335)

Net cash outflow from investing activities                                (4,776)                      48

Net cash outflow before financing                                         (4,934)                   (287)

Net cash  inflow from financing                                             4,918                       0

Net cash outflow                                                             (16)                   (287)
Net debt at beginning of period                                          (18,554)                (15,727)
Realised exchange gains/(losses) on currency balances                       (135)                     135
Movement in bank loan to finance investments                              (4,918)                       0
Exchange movement on loan facility                                          1,287                   (768)

Net debt at period end                                                   (22,336)                (16,647)








                                                            As at 31 January 2006      As at 31 July 2005
Assets                                                                      £'000                   £'000

Listed investments                                                        180,581                 139,144

Net current liabilities                                                  (22,734)                (19,701)

Creditors: amounts falling due after one year                                   -                       -

Net Assets                                                                157,847                 119,443

Net asset value per share - undiluted pence                               126.27p                  95.55p





The Board of Directors approved this statement on 30 March 2006.



Notes

1.The above financial information is unaudited and does not amount to statutory
accounts under Section 240 of the Companies Act 1985 (as amended).  The
information given for the financial year ended 31 July 2005 does not constitute
the Company's statutory accounts for that financial year.  Statutory accounts
for the financial year ended 31 July 2005 have been reported on by the Company's
auditors and delivered to the Registrar of Companies.  The report of the
auditors was unqualified and did not contain a statement under Section 237(2) or
(3) of the Companies Act 1985.



2. This announcement is prepared on the basis of the accounting policies as set
out in the most recent published set of annual financial statements with the
following exceptions, which have arisen from the adoption of new accounting
standards and the Statement of Recommended Practice 'Financial Statements of
Investment Trust Companies' ('SORP') issued in January 2003 and revised in
December 2005.

a) FRS26 (Financial Instruments: Measurement) - The Company has designated its
assets and liabilities  as being measured at 'fair value through profit or
loss'. The fair value of listed investments is deemed to be the bid value of
those investments at the close of business on the relevant date. Previously,
listed investments were valued at last traded price basis. There was no
difference between the last traded price basis and the bid value of the
investments at 31 January 2006, 31 January 2005 and 31 July 2005.

Transaction costs have been included within capital account. Purchase
transaction costs amounted to £21,000 for the period to 31 January 2006 and
sales transaction costs amounted to £16,000.

b) FRS25 (Financial Disclosure and Presentation) - Warrants issued by an
Investment Trust Company (ITC) should be classified as equity  and the net
proceeds shown as a warrant reserve and included as part of equity holders'
funds. If warrants issued by an ITC lapse unexercised then the amount previously
recognised in respect of the warrant should be reclassified as a realised gain.
This is not reflected in the profit or loss but reported as a movement in the
Reconciliation of Movement in Shareholders' Funds. The accounts for the period
ended 31 January 2005 and the year ended 31 July 2005 have been restated to
reflect these changes.

c) FRS 23 (The effects of changes in Foreign Exchange Rates) - The financial
statements of a company are presented in currency of the primary economic
environment in which it operates (its functional currency). The functional and
presentational currency of this Company is deemed to be sterling and the
financial statements presented accordingly.


Chairman's Statement



Performance



I am very pleased to report that your Company has experienced a strong period of
growth over the six months ended 31 January 2006. The Company's net asset value
increased by 32.2%, whilst the share price increased by 38.4%. The Tokyo Stock
Exchange ('TSE') First Section produced a Total Return in sterling terms of
35.3% over the same period.



An analysis of the performance of the portfolio can be found in the following
Investment Manager's Review.



Director Changes



Mr. Yoshindo Takahashi has been appointed as a Non-Executive Director of the
Company with effect from 19 December 2005.



Mr. Takahashi, aged 65, is currently Director of the Office of Pharmaceutical
Industry Research, a research arm of Japan Pharmaceutical Manufacturers
Association.  He is also a member of the Management Committee of Executive
Partners Inc, a consulting firm for small and emerging companies and a statutory
auditor (Independent) of Netprice Corp, an internet shopping company based in
Japan. He was previously Executive Director and Dean of Nomura School of
Advanced Management (1996 - 2000) and Executive Vice President of Nomura
Research Institute Ltd (1994 - 1996). He served as President and then Chairman
of Nomura Research Institute Europe Ltd and Nomura Research Institute America
Inc. between 1980 and 1991.



Mr. Takahashi will be proposed for election at the 2006 Annual General Meeting.



Mr. Keisuke Egashira retired as a Director of the Company on 19 December 2005 on
accepting the Chairmanship of a major motor-vehicle manufacturer in Japan. He
served as a Director of the Company since its launch in 1994 and has made an
invaluable contribution to the deliberations of the Board. He leaves with the
thanks and best wishes of all the Directors.



Accounting Standards



The Accounting Standards Body has implemented a convergence programme with
International Accounting Standards and has introduced a number of new and
revised Accounting Standards, which have been adopted in these interim accounts.
In addition the Company has also complied with the revised Statement of
Recommended Practice issued by the AITC in December 2005. These changes have had
no financial impact in our interim accounts other than presentational changes
and additional disclosures.



Gearing



During the six-month period ended 31 January 2006, the Company increased total
borrowings to Yen 5.5 billion (from Yen 4.5 billion) in line with the increase
in asset values. All of the borrowings continue to be obtained via a revolving
credit facility with variable draw-down periods, providing flexibility to the
Board and the Manager.



Jonathan Taylor

Chairman











Investment Manager's Review



Performance



The Company's net asset value rose 32.2% in sterling terms during the six months
to 31st January 2006.



Over this period, the benchmark Index rose strongly in local currency terms, by
42.6% and slightly less so in sterling terms, by 35.3%. Rising expectations for
economic growth and corporate earnings and a resounding victory for Prime
Minister Koizumi in parliamentary elections provided a positive impetus to the
market.



Commodity-related sectors, such as steels, metals and resources, performed
strongly against a backdrop of strong global and, in particular, regional demand
and pricing. At the same time, high-beta domestic stocks, such as real estate,
brokers, banks and insurance warmed to the prospect of asset inflation. Toward
the end of 2005, the market became increasingly momentum - and thematically
driven, throwing out exceptional value in some neglected stocks at the end of
the period.



Underperformance came from an underweight position in commodity sectors, with
the exception of trading companies, and in higher-beta domestic sectors, such as
banks, where valuations look stretched.



Outlook



We are expecting real GDP growth above 2% for the third successive fiscal year.
Indeed, real GDP growth is likely to grow at this rate again in the next fiscal
year ending March 2007. The outlook for next year is dependent on inflation and
interest rates. The core CPI turned positive in November (+0.1%) and is likely
to continue rising for the next few months. Although we do not expect higher
interest rates until the beginning of 2007, the Bank of Japan may feel obliged
to act earlier if inflation rises above 1%. Overall, we expect a relatively
positive environment for companies with profits growth of around 10%. A greater
focus on improving return on equity by using excess capital appropriately would
lead to higher valuation multiples.



The chief threats to this scenario are premature tightening of fiscal/monetary
policy by the authorities and potential political upheaval as Prime Minster
Koizumi steps down.



Investment Policy



The market has maintained a strong focus on domestic reflation. Whilst trends in
nominal GDP have been supportive, an important medium term driver of the market
will be a further rise in return on equity driven more by balance sheet
restructuring. This will benefit cash-generative companies able to use excess
cash to reinvest or return to shareholders. The portfolio continues to include
exposure to such situations, for example Takeda Pharmaceutical and Nissan Motor.



There is growing evidence that profits momentum is beginning to peak,
particularly if one isolates from market earnings those segments which have
enjoyed strongly favourable tailwinds, such as trading companies, or banks,
where provisions have been written back. Having said that, nominal growth should
be sufficiently strong to sustain reasonable levels of profits growth. A concern
would be that this proves insufficient to sustain multiples in many segments of
the market and we believe, therefore, that stock selection, rather than the
sector themes, which have driven the market forward over recent periods, will be
increasingly important. We are particularly positive on stocks like Astellas
Pharmaceutical, Omron and T&D Holdings and would add to positions on any
weakness. Effective net gearing at the end of January was 14.1%.



Schroder Investment Management Limited









Interim Report

The Interim Report will be mailed to registered shareholders at their registered
addresses. Copies of the Interim Report will be made available from the date of
release at the Company's registered office, 31 Gresham Street, London, EC2V 7QA.



Enquiries:                                   Schroder Investment Management Limited

John Spedding                               (020 7658 3206)

30 March 2006


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