Interim Results

Scottish Oriental Smlr Co Tst PLC
24 March 2005


               THE SCOTTISH ORIENTAL SMALLER COMPANIES TRUST PLC

   Preliminary Results (Unaudited) for the six months to 28th February 2005


The Board of The Scottish Oriental Smaller Companies Trust PLC is pleased to
announce the results for the six months to 28th February 2005.

These results are presented in a format which summarises the information which
will be given in the forthcoming Interim Report.

Financial Highlights

  • Undiluted net asset value per ordinary share rose by 19.8% to 216.19p
    and fully diluted net asset value rose by 17.3% to 198.44p.
  • This compares with a rise of 16.6% in the benchmark Index - the MSCI AC
    Asia (Ex Japan) Index.
  • The Nomura Asia Small Cap Index and the FTSE All-Share Index increased
    20.3% and 12.7% respectively over the same period.
  • Share price rose by 23.3% to 193.25p.
  • Warrant price rose by 34.5% to 93.50p.


Statement of Total Return for the six months to 28th February 2005 (Unaudited)

           Six months to 28th February 2005   Six months to 29th February 2004
                                       
                Income*    Capital    Total   Income*       Capital      Total
                  £'000      £'000    £'000     £'000         £'000      £'000

Gains on
investments           -      9,033    9,033         -         3,197      3,197
Income from
investments         907          -      907       567             -        567
Other income         82          -       82        48             -         48
Investment
management fee     (260)         -     (260)     (235)            -       (235)
Currency gains        -         40       40         -           160        160
Other
administrative
expenses           (150)         -     (150)     (150)            -       (150)
                 --------   --------  ------- ---------       -------    -------

Net return
before finance
costs and           
taxation            579      9,073    9,652       230         3,357      3,587
Finance costs
of borrowing        (18)         -      (18)      (18)            -        (18)
                 --------   --------  ------- ---------       -------    -------

Return on
ordinary
activities
before              
taxation            561      9,073    9,634       212         3,357      3,569
Tax on
ordinary
activities         (153)        28     (125)      (44)            -        (44)
                 --------   --------  ------- ---------       -------    -------

Return
attributable
to equity           
shareholders        408      9,101    9,509       168         3,357      3,525
Ordinary              
dividends on     
equity shares         -          -        -         -             -          -
                 --------   --------  ------- ---------       -------    -------
Transfer to
reserves            408      9,101    9,509       168         3,357      3,525
                 --------   --------  ------- ---------       -------    -------

Return per
ordinary share     1.60p     35.71p   37.31p     0.66p        13.02p     13.68p

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



Statement of Total Return for the six months to 28th February 2005 (Unaudited)
(Continued)
                                                  Year ended 31st August
                                                                          2004
                                            Income*      Capital         Total
                                               £'000         £'000       £'000

Gains on investments                               -         1,326       1,326
Income from investments                        1,467             -       1,467
Other income                                     100             -         100
Investment management fees                      (480)            -        (480)
Currency gains                                     -            28          28
Other administrative expenses                   (272)            -        (272)
                                              --------      --------     -------

Net return before finance costs and              815         1,354       2,169
taxation
Finance costs of borrowing                       (36)            -         (36)
                                              --------      --------     -------

Return on ordinary activities before             779         1,354       2,133
taxation
Tax on ordinary activities                      (232)          (63)       (295)
                                              --------      --------     -------

Return attributable to equity                    547         1,291       1,838
shareholders
Ordinary dividends on equity shares             (401)            -        (401)
                                              --------      --------     -------

Transfer to reserves                             146         1,291       1,437
                                              --------      --------     -------

Return per ordinary share                       2.14p         5.05p       7.19p

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



SUMMARY BALANCE SHEET         As at 28th      As at 29th        As at 31st
               (Unaudited)   February 2005   February 2004   August 2004 (1)
                                     £'000           £'000              £'000

Total investments                   53,970          48,498             46,934
Net current assets                   4,918           2,892              2,520
Japanese Yen loan                   (3,337)         (3,304)            (3,404)
Deferred Tax                           (38)            (32)               (53)
                                ------------     -----------        -----------
Equity shareholders' funds          55,513          48,054             45,997
                                ============     ===========        ===========

Net asset value per share -
undiluted                           217.79p         188.58p        180.50p (2)
Net asset value per share -
fully diluted                       199.91p         175.59p            169.14p

(1) The preliminary statement is not the Trust's statutory accounts. The results
for the year to 31st August 2004 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) Including Revenue Reserve uplift for the 6 months to 28th February 2005 (see
note at end of this statement).



Cash Flow Statement for the six months to 28th February 2005

                      Six months to        Six months to          Year to
                    28th February 2005   29th February 2004   31st August 2004
                      £'000      £'000      £'000     £'000     £'000    £'000
OPERATING
ACTIVITIES:
Dividends received
from:
Investments                        961                  633              1,460
Interest received                   82                   49                100
                                --------             --------            -------
                                 1,043                  682              1,560
Investment
management fee         (245)                 (229)               (460)
Secretarial fee         (22)                  (21)                (43)
Directors' fees         (35)                  (29)                (61)
Other expenses
paid                    (94)                  (85)               (169)
                     --------              --------            --------

                                  (396)                (364)              (733)
                                --------             --------            -------
Net cash inflow
from operating
activities                         647                  318                827
RETURNS ON
INVESTMENTS AND
SERVICING OF
FINANCE
Interest paid on
borrowings                         (18)                 (18)               (36)
TAXATION:
Total tax paid                     (30)                 (21)              (204)
CAPITAL EXPENDITURE
AND FINANCIAL
INVESTMENT:
Purchases of
investments          (8,818)              (10,930)            (15,272)
Sales of
investments          11,047                 9,754              13,914
Capital
Corporation Tax           -                     -                   2
Indian capital
gains tax                28                   (31)                (31)
Currency losses         (27)                 (166)               (199)
                     --------              --------            --------

Net cash
outflow/(inflow)
from capital
expenditure and
financial
investment                       2,230               (1,373)            (1,586)
EQUITY DIVIDEND
PAID                              (401)                (382)              (382)
Financing:
Subscription of new
capital:
Ordinary shares           6                    13                  13
                     --------              --------            --------

                                     6                   13                 13
                                --------             --------            -------

Increase/(decreas
e) in cash                       2,434               (1,463)            (1,368)
                                ========             ========            =======



BOARD STATEMENT

Investment Performance

In the six months ending 28th February 2005, Scottish Oriental's fully diluted
and undiluted net asset value per share rose 17.3 per cent to 198.44p and 19.8
per cent to 216.19p respectively. This compares with sterling-adjusted increases
of 16.6 per cent in the MSCI AC Asia (ex Japan) Index and 20.3 per cent in the
Nomura Asia Small Cap Index. The Trust's share price appreciated by 23.3 per
cent, resulting in a slight reduction of the discount to net asset value. The
Trust outperformed the FTSE All-Share Index, which rose 12.7 per cent over the
period.

Smaller companies generally outperformed their larger counterparts over the
period with particularly strong returns in Indonesia, India, the Philippines and
South Korea.

Review

Asian stockmarkets rose over the six month period ending February 2005 supported
by low interest rates and evidence of a strong regional economy. Indonesia was
the best performing market over the period following the largely peaceful
Presidential election, which was won by Susilo Bambang Yudhoyono with a wide
margin. This stockmarket also responded positively to strong economic growth,
with the World Bank raising its GDP forecasts for Indonesia to 4.9% in 2004 and
5.4% in 2005. South Korea rose sharply in recent months as investors became more
confident of a recovery in the domestic economy. Malaysia was the worst
performing market as the Government confirmed that the currency peg would remain
for the foreseeable future. Hong Kong was also weak owing to concerns over an
expected increase in interest rates.

Outlook

The long-term outlook for Asia remains positive relative to the rest of the
world. Developed economies continue to outsource manufacturing to Asia, most
notably to China, which continues to see strong foreign direct investment flows.
High savings rates generally prevail and companies have focused on paying down
debt. Although controlling families and other major shareholders of listed
entities do not always treat minorities with respect, corporate governance and
stockmarket regulation have undoubtedly improved over the last ten years.

The economic background for Asia remains moderately positive although inflation
has emerged as a potential problem in some countries. Labour shortages, for
instance, have been reported for the first time in South China. A collapse in
the US dollar, a significant slowdown in China's economic growth and a sharp
upward increase in the oil price would each have a negative impact on the
Region. The outlook for corporate profit growth is expected to be dull owing to
a slowdown in exports and margin pressure. Valuations are no longer compelling.

Notwithstanding their recent outperformance, Asian smaller companies continue to
trade at discounts to their larger counterparts. Scottish Oriental's investment
philosophy is well suited to the current stockmarket volatility, given its focus
on well-managed, financially sound companies.

Borrowing

Scottish Oriental's borrowings of £3.3m in Yen represent approximately 6.0 per
cent of net assets at 28th February 2005. The interest on the borrowings is
1.04% and the facility matures on 28th February 2007. This borrowing continues
to give the Trust greater flexibility to enhance long term returns.

Dividend

A dividend of 1.575p per share net (equivalent to 1.75p gross) was paid on 27th
January 2005 for the year ending 31st August 2004. It is too early to make a
forecast of the 2005 distribution, but your Board would hope at least to
maintain the dividend at last year's level.




Performance for the six months to 28th February 2005 (Unaudited)

Net Asset Value (fully
diluted)                + 17.3%   MSCI AC Asia (ex Japan)            + 16.6%
Net Asset Value
(undiluted)             + 19.8%   Index (£)
Share Price             + 23.3%   Nomura Asia Small Cap Index (£)    + 20.3%
Warrant Price           + 34.5%   FTSE All-Share Index               + 12.7%


Summary Data at 28th February 2005 (Unaudited)

Shares in
issue          25,488,602   Shareholders' Funds                         £55.10m

Warrants in
issue           4,725,048   Market Capitalisation                       £49.26m

Net Asset
Value per
share              198.44p  Share Price Discount to Net Asset              2.6%
(fully                      Value (fully diluted)
diluted)

Net Asset
Value per
share              216.19p  Share Price Discount to Net Asset Value       10.6%
                            (undiluted)
(undiluted)

Share Price        193.25p
Warrant             93.50p
Price

Benchmark and Comparative Indices

From inception in March 1995 until October 1999, the Trust adopted the Morgan
Stanley Capital International AC Asia (ex Japan) Index ('MSCI') as its
benchmark.  No suitable regional smaller companies index was available at that
time.

In October 1999 the Directors agreed to the replacement of the MSCI with the SG
Asian (ex Japan) Smaller Companies Index, following its reconstitution to cover
previously excluded countries.  Unfortunately, this Index ceased to be available
from the end of 2002.

The Directors consequently decided to revert to the MSCI as its benchmark.  This
Index, being dominated by larger companies, is far from an ideal performance
measurement tool.  It has, however, the dual merits of being the most widely
recognised regional index and of pre-dating the inception of the Trust.

For comparison purposes, the Trust is also displaying The Nomura Small Cap Index
('NASCI') which covers the relevant markets with the exception of Pakistan and
Sri Lanka.  The NASCI is made up of companies with a market capitalisation of
between US$100m and US$1,000m,  This range does not match exactly that of the
Trust, which has no lower limit and which is generally restricted to companies
with a market capitalisation of under US$750m.  Unfortunately this Index dates
only from the end of 1996, and thus cannot provide a complete historical
performance comparison with the Trust.  Nevertheless, the NASCI gives a useful
indication of the performance of smaller companies in Asia over recent years.

As most investors in the Trust are based in the United Kingdom, the Directors
consider that it is also relevant to compare the Trust's performance to that of
the FTSE All-Share Index.

Notes:

(1) The accounting policies applied in preparing these accounts are consistent
with those applied in the latest published annual accounts.

(2) The Shareholders' Funds and Net Asset Value per share figures at 28th
February 2005 are stated on a capital only basis, and do not include any income
retention at that date. This is because the Trust only pays one dividend per
year for which no provision has been made at this stage. However, the
Shareholders' Funds and Net Asset Value per share figures given with the Balance
Sheet do include the Revenue Reserve uplift for the period.

(3) The terms of the interim report and the preliminary announcement were
approved by the Board on 24th March 2005.

(4) Copies of the Interim Report will be posted to shareholders shortly and
further copies may be obtained from the registered office at 23 St Andrew
Square, Edinburgh, EH2 1BB.



Enquiries:    Angus Tulloch / Susie Rippingall
              First State Investments, Edinburgh Ph: 44 (0)131 473 2200



24 March 2005



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