Interim Results

Scottish American Investment Co PLC
25 July 2002



               THE SCOTTISH AMERICAN INVESTMENT COMPANY PLC

     Preliminary Results (Unaudited) for the six months to 30th June 2002


The Scottish American Investment Company PLC (SAINTS) is an international
general investment trust. The Company's investment objective is to offer private
investors a diversified portfolio that achieves a balance between growth of
capital and a reasonable level of income. SAINTS, which has total assets of £367
million, is managed by First State Investments, part of the Commonwealth Bank of
Australia Group.



Summary


•       Performance - SAINTS' net asset value total return was minus 11.0 per
cent. This compares with a total return for our benchmark (65 per cent FTSE All-
Share Index : 35 per cent FTSE World ex-UK Index) of minus 10.3 per cent. The
net asset value per share was down 12.1 per cent.

•       Second quarterly dividend of 1.40p per share (2001:1.39p) payable on 7th 
October 2002.

•       International Equity Manager - David Leary, Head of Global Equities at
First State Investments, took over the management of our non-UK equity portfolio
in April.




Results

Attached is a copy of the preliminary results.  These are presented in a format
which summarises the information which will be given in the forthcoming Interim
Report.



For further information, please contact:


Sara Dennehy             First State Investments, London         0207 332 6500






THE SCOTTISH AMERICAN INVESTMENT COMPANY PLC

Preliminary Results (Unaudited) for the six months to 30th June 2002





SUMMARY
                                                   30th June 2002          31st December 2001          % change

Asset Value per Share                                  198.4p                     225.7p             -12.1
Dividend per Share                                       2.8p*                     5.57p              +0.7**
Share Price                                           167.75p                    192.25p             -12.7



*  For half year               ** Change from same period last year





INVESTMENT PERFORMANCE

The first six months of 2002 have been disappointing for equity markets.  For
the half year, to the end of June, the total return on net assets per share was
minus 11.0 per cent.  This compares with a total return for our benchmark (65
per cent FTSE All-Share index : 35 per cent FTSE World ex-UK index) of minus
10.3 per cent.

Significant changes in the management of SAINTS have been made over the last
nine months, and progress has been made in improving the relative investment
performance.  We are encouraged that, during a period of unprecedented
volatility, SAINTS has outperformed its benchmark over the nine month period
since we began instituting these changes.  Nevertheless, we trailed the
benchmark by 0.7 per cent over the 6 months to 30th June and fully recognise
that this, combined with the negative total return over the period, is a
disappointment for shareholders.

The 2001 Annual Report explained the changes made last October with Stuart Paul
assuming overall responsibility for SAINTS and Derek Lygo being brought in to
First State Investments to manage the UK portfolio.  Mr Lygo has considerably
reduced the overall risk profile of the UK portfolio, increasing the number of
shares and raising the yield on the portfolio.  This has benefited performance
as defensive shares, particularly those supported by a healthy yield, have held
up well this year.  Less successful so far has been the introduction of a few
holdings in companies more sensitive to the economy.  This move has been too
early.  Although leading indicators for the UK economy have been strengthening
indicating that the economic outlook should improve, the economic recovery has
not yet been strong enough to improve sentiment towards cyclical companies.  As
a consequence, the UK results have been held back and caused the overall
performance to lag the benchmark in the first half of 2002.

Outside the UK, results were much better, with the international equities
comfortably ahead of the FTSE World ex-UK index.  An overweight position in
Asia, and to a lesser extent in Continental Europe, offset by being underweight
in North America, were the main reasons for the positive relative return.  The
Asia Pacific/ Emerging Markets portfolio performed particularly strongly with a
substantial absolute gain in value.





INTERNATIONAL EQUITY MANAGER

A further significant management change was made in April.  Historically the
international equity investments have been managed as four separate geographical
portfolios.  The portfolio manager for each geographical area has constructed an
independent portfolio with the objective of outperforming the relevant regional
stockmarket index.  In April, David Leary, Head of Global Equities at First
State Investments, took over responsibility for the management of all our non-UK
equities. The result is a shorter but more focused list of holdings, selecting
the most attractive investments across all four geographical areas rather than
constructing four separate portfolios.  This change makes full use of First
State Investments' strategic investment focus with sector analysts following
shares by industry on a global basis.




EQUITY INVESTMENTS AS % OF SHAREHOLDERS' FUNDS


                                                                    30th June                31st December

                                                                      2002                        2001

                                                                        %                          %
United Kingdom                                                         64                          64
North America                                               16                        21
Continental Europe                                          10                        7
Japan                                                       3                         3
Asia Pacific/Emerging Markets                               6                         4
Total International                                                    35                          35
Unquoted                                                                3                           2
Total Equities                                                        102*                        101*



* The amount by which equity investments exceed 100 per cent of shareholders'
funds is the level by which the Trust is geared to equity markets. The gearing
is financed by long term borrowing.





DIVIDEND

SAINTS will pay a second interim dividend of 1.40p per share on 7th October 2002
to shareholders registered on 6th September 2002 making a total for the year to
date of 2.80p, compared with 2.78p last year.  SAINTS' shares continue to yield
more than the yield on the FTSE All-Share index.  This is a high yield for a
Trust with significant investments overseas where yields are considerably lower
than in the UK.  However, the reorganisation of the UK portfolio and the
relatively high and growing yield on the property portfolio give your Board
confidence that the dividend can be maintained.





MARKETS AND OUTLOOK

While many of the smaller markets, particularly in Asia, made useful gains in
the first three months of the year, the major markets levelled off after the
rally in share prices in late 2001.  In late March, markets began to falter and
the second quarter saw substantial losses.  By mid-year most markets were back
near their September lows.

A deep recession was avoided last year by the aggressive action to cut interest
rates by central banks, particularly by the US Federal Reserve.  While
manufacturing industry cut back, consumer spending held up surprisingly well and
the US economy quickly turned round leading a global economic recovery.  Signs
that the rate of recovery was slowing in the second quarter, a major question
mark over the integrity of company accounts and a weaker dollar all contributed
to a general decline in equity markets.

Sentiment towards equities has deteriorated considerably since the start of the
year.  In the past, when gloom has prevailed, it has been the time to take a
more positive attitude.  The sharp fall in markets has considerably improved the
attraction of equities.  Valuations are becoming more reasonable.  We have
avoided being geared into equity markets this year but will be looking for the
opportunity to take a more positive view during the second half of the year.






STATEMENT OF TOTAL RETURN

(incorporating the income account) (UNAUDITED)

for the six months to 30th June 2002


                                    Six months to   30th June       2002          Six months to   30th June   2001
                                    Income*         Capital         Total         Income*         Capital     Total
                                    £'000           £'000           £'000         £'000           £'000       £'000

(Losses)/gains on investments       -               (28,050)        (28,050)      -               5,614       5,614
Unrealised losses on investments    -               (11,923)        (11,923)      -               (72,579)    (72,579)
Gains on Equities Index Unsecured
Loan Stock                          -               -               -             -               1,847       1,847

Losses on investments               -               (39,973)        (39,973)      -               (65,118)    (65,118)
Income from investments             5,329           -               5,329         5,936           -           5,936
Rental income                       1,125           -               1,125         1,103           -           1,103
Other income                        273             -               273           353             -           353
Investment management fees          23              67              90            31              93          124
Currency (losses)/gains             -               (76)            (76)          -               91          91
Other expenses                      (669)           -               (669)         (717)           -           (717)

Net return before finance costs and
taxation                            6,081           (39,982)        (33,901)      6,706           (64,934)    (58,228)
Finance costs of borrowing          (737)           (2,210)         (2,947)       (1,053)           (2,206)     (3,259)

Return on ordinary activities
before taxation                     5,344           (42,192)        (36,848)      5,653           (67,140)    (61,487)
Tax on ordinary activities          (720)           618             (102)         (689)           552         (137)

Return attributable to equity       4,624           (41,574)        (36,950)      4,964           (66,588)    (61,624)
shareholders
Ordinary dividends on equity         (3,882)        -               (3,882)       (4,272)         -             (4,272)
shares:
2.80p per share (2001-2.78p)

Transfer to/(from) reserves         742             (41,574)        (40,832)      692             (66,588)    (65,896)

Return per ordinary share           3.27p           (29.43p)        (26.16p)      3.19p           (42.80p)    (39.61p)



* The income column of this statement is the Profit and Loss Account of the
Company.
All income and capital items derive from continuing operations.






STATEMENT OF TOTAL RETURN

(incorporating the income account) (UNAUDITED)

for the year ended 31st December 2001


                                               Year ended          31st December        2001 (1)
                                               Income*             Capital              Total
                                               £'000               £'000                £'000

(Losses)/gains on investments                  -                   (13,712)             (13,712)
Unrealised losses on investments               -                   (98,047)             (98,047)
Gains on Equities Index Unsecured
Loan Stock                                     -                   1,848                1,848

Losses on investments                          -                   (109,911)            (109,911)
Income from investments                        9,670               -                    9,670
Rental income                                  2,195               -                    2,195
Other income                                   686                 -                    686
Investment management fees                     121                 362                  483
Currency (losses)/gains                        -                   104                  104
Other expenses                                 (1,272)             -                    (1,272)

Net return before finance costs and
taxation                                       11,400              (109,445)            (98,045)
Finance costs of borrowing                     (1,704)             (4,336)              (6,040)

Return on ordinary activities before
taxation                                       9,696               (113,781)            (104,085)
Tax on ordinary activities                     (1,359)             1,166                (193)

Return attributable to equity                  8,337               (112,615)            (104,278)
shareholders
Ordinary dividends on equity shares:            (8,356)            -                    (8,356)
5.57p per share

Transfer to/(from) reserves                    (19)                (112,615)            (112,634)

Return per ordinary share                      5.46p               (73.79p)             (68.33p)



* The income column of this statement is the Profit and Loss Account of the
Company.
All income and capital items derive from continuing operations.





SUMMARISED BALANCE SHEET (UNAUDITED)

As at 30th June 2002


                                                       30th June 2002       30th June     31st December 2001(1)
                                                            £'000             2001                £'000
                                                                              £'000

Total Investments                                     327,917           483,363           400,920
Net Current Assets                                    38,970            (2,145)           21,930

Total Assets less Current Liabilities                 366,887           481,218           422,850
Creditors due after one year                          (90,020)          (91,018)          (90,274)

Equity Shareholders' Funds                            276,867           390,200           332,576


Net asset value per share                             198.4p                 255.2p       225.7p

Share price                                           167.75p                218.75p      192.25p



CASH FLOW STATEMENT (UNAUDITED)

AS AT 30TH JUNE 2002


                                                                 Six months to    Six months to 30th Year to 31st
                                                                 30th June            June 2001      December 2001(1)
                                                                       2002             £'000             £'000
                                                                      £'000

Cash and deposits at the start of the year                       26,970           20,654             20,654

Income
Dividends received                                               3,652            4,323              7,177
Interest received                                                1,687            1,659              3,647
Underwriting commission and other income                         1,140            1,222              2,118
Investment management fee                                        35               29                 224
Other administrative expenses paid                               (736)            (633)              (1,211)
Income less administrative expenses                              5,778            6,600              11,955

Interest paid on borrowings                                      (800)            (1,874)            (2,185)
Dividends paid to shareholders                                   (4,081)          (4,341)            (8,581)
Cash paid in respect of interest and dividends                   (4,881)          (6,215)            (10,766)

Tax paid                                                         (84)             (654)              (714)
Cash received / (paid) in respect of income transactions         813              (269)                      475
Capital
Purchases of investments                                         (141,405)        (211,525)          (364,427)
Sales of investments                                             174,243          188,866            378,942
                                                                 32,838           (22,659)           14,515

Repurchase of Ordinary share capital                             (15,066)         (6,199)            (19,636)
Issue of 8% Debenture Stock 2022                                 -                36,085             35,436
Repayment of Equities Index Unsecured Loan Stock 2004            -                (20,802)           (20,802)
Repayment of 4% Irredeemable Stock                               -                -                  (476)
Performance fee                                                  327              322                322
Investment management fee                                        103              249                349
Interest paid on borrowings                                      (2,400)          (1,717)            (3,971)
Currency (losses)/gains                                          (84)             90                 104
Cash received/(paid) in respect of capital transactions          15,718           (14,631)           5,841
Total cash received/(paid)                                       16,531           (14,900)           6,316
Cash and deposits at end of the period                           43,501           5,754              26,970






(a)    Reconciliation of total income as shown in the Statement of Total Return
to income less administrative expenses in the Cash Flow Statement

                                                                  Six months to   Six months to 30th        Year to
                                                                    30th June            June            31st December
                                                                      2002               2001                2001
                                                                      £'000              £'000               £'000

Total income per the Statement of Total Return                  6,727             7,392               12,551
Total expenses per the Statement of Total Return                (646)             (686)               (1,151)
                                                                6,081             6,706               11,400
(Increase) / decrease in dividends accounted for but for which
the cash had not been received at the year end                  (235)             (267)               192
Decrease / (increase) in other debtors                          (7)               169                 376
(Decrease) / increase in creditors                              (61)              (8)                 (13)
Income less administrative expenses per Cash Flow Statement     5,778             6,600               11,955





(b) Analysis of changes in net debt
                                                      At the start of       Cash            Other      At the end of the
                                                        the period          Flows          Changes     period
                                                           £'000            £'000           £'000      £'000
                                                                            
Cash                                                 26,970            16,531          -               43,501
8% Debenture Stock 2022                              (90,274)          -               254             (90,020)
                                                     (63,304)          16,531          254             (46,519)





Notes:


(1)   The preliminary statement is not the company's statutory accounts. The results for the year to 31st December
      2001 and the position as at that date are an abridged version of the full accounts for that year, which received
      an unqualified audit report and did not contain statements under Section 237(2) or (3) of the Companies Act 1985
      and which have been filed with the Registrar of Companies.
(2)   The accounting policies applied in preparing these accounts are consistent with those applied in the latest
      published annual accounts.
(3)   The terms of the Interim Report and the Preliminary Announcement were approved by the Board on 25th July 2002.

25th July 2002




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