Final Results

F&C Global Smaller Companies PLC
22 June 2007



Date:              21 June 2007

Contact:           Peter Ewins
                   F&C Management Limited
                   020 7628 8000



                        F&C GLOBAL SMALLER COMPANIES PLC
                    Audited Preliminary Statement of Results
                        for the year ended 30 April 2007

HIGHLIGHTS

  • Rise in the share price of 8.8%
  • NAV per share total return was 10.4%, well ahead of the Benchmark total
    return of 7.5%
  • Rise in ordinary dividends for the year of 3.5%


SUMMARY OF AUDITED RESULTS FOR THE YEAR ENDED 30 APRIL 2007


Attributable to equity shareholders                                30 April 2007           30 April 2006       % Change

Share price                                                              473.25p                 435.00p           +8.8

Net asset value per share (debenture at nominal value)                   512.21p                 470.83p           +8.8

Net asset value per share (debenture at market value)                    505.14p                 463.47p           +9.0


                                                                      Year ended              Year ended
                                                                   30 April 2007           30 April 2006       % Change

Revenue return per share                                                   4.75p                   4.54p           +4.6

Ordinary dividends per share                                               4.69p                   4.53p           +3.5

Special dividend per share                                                     -                   1.00p

Total expense ratio (based on average net assets)                          0.99%                   0.69%





Chairman's Statement

I am pleased to report that your Company has made further progress in the year
under review. Both the share price and the net asset value ('NAV') per share
ended the year at record levels, having recovered the slight falls reported at
the half year. Shareholders have again seen the value of their investment rise
by a faster rate than the Benchmark.

Over the year, the share price rose 8.8%, while the NAV per share total return
was 10.4%. The Benchmark total return was 7.5%.

The good performance record has been recognised by the Money Observer magazine
naming F&C Global Smaller Companies as the 'Best Global Trust' in its 2007
awards. This is based on performance for the 2004 to 2006 period, and was won
against competition from all other global investment trusts, which marks a real
achievement. My congratulations go to our Manager, Peter Ewins, and all the team
involved at F&C Management Limited ('F&C').

Dividends

Once more, good dividends earned from our investment portfolio provided a sound
base for the Company's own dividend payment, and the Board is recommending a
final dividend of 3.16p. This is a 3.9% rise on the final dividend of last year,
making a total dividend of 4.69p for the year. Stripping out the effect of last
year's 1.00p special dividend, this means that the payment for the year is up
3.5%, making this the 37th year of underlying dividend increases.

Performance and the benchmark

The Company's stated benchmark (the 'Benchmark') is a blended index of the
returns from the Hoare Govett UK Smaller Companies Index ('HGSC') (40%) and the
MSCI World ex UK Small Cap Index (60%), with the proportions approximately
reflecting the balance of the portfolio between the UK and the rest of the
world. The Benchmark is not perfect but our performance against it does provide
a good yardstick as to how we are doing in relative terms. In addition, we
measure the performance of the regional sub-portfolios against appropriate
smaller company indices to ensure that all parts of the portfolio are closely
monitored.

Shareholders will remember that last year we introduced a performance fee if F&C
outperformed the Benchmark and, at the same time, we reduced the base fee to
0.4% of net assets. The good performance this year means that we will be paying
out £566,000 in performance fees which more than offsets the £287,000 reduction
in the base management fee. Our total expense ratio for the year was 0.99%,
including the performance fee, which I am pleased to say continues to remain low
compared to other investment vehicles.

One of the Board's responsibilities is to monitor the Benchmark to ensure that
it remains the most appropriate way to measure the Manager's performance. One
development that we are keeping under review is the growing role of the
Alternative Investment Market ('AIM') in the context of the UK market and our UK
portfolio. It may therefore at some point be appropriate to change the UK part
of the benchmark to incorporate AIM stocks, as these are not included in the
HGSC. As it happens, in the past year, the Manager's performance would have
looked better still had the Benchmark included AIM stocks. No change will, of
course, be made unless we feel that it is in the interests of shareholders.

As a smaller company trust, stock selection is the prime determinant of our
success or failure. In the year we benefited from good stock-picking in the UK
and Europe. The Manager has consistently delivered strong performance in the UK
market in recent years, which is important as this remains the largest part of
the portfolio. The Asian portfolio also enjoyed a good first year under the new
approach focusing on collective investment vehicles.

Importantly we also derived a positive contribution from asset allocation
decisions. We benefited from the strength of the UK market in comparison to the
other world markets as we were overweight for almost the entire period. We were
also overweight throughout the year in Continental Europe and underweight for
the full year in the US, which again proved to be the correct calls given the
widely different returns from these markets

Gearing on the portfolio produced a marginal benefit over the year. Share
buybacks also helped the reported NAV growth.

Markets

After weakness in the spring and early summer of 2006, equity markets regained
their momentum as the year progressed, though we did not see the consistent
outperformance from smaller market capitalisation stocks that we have had in
recent years. Interest rates rose across most of the world over the year, which
held back enthusiasm. Inflation has moved up meaningfully in the UK and US in
particular, with most commodity prices remaining very high by historic
standards.

Once again, China and other Asian countries have led the field in terms of
economic growth, but a pick-up has also been noticeable in mainland Europe. The
UK's growth remained robust. We expected the US economy to slow during the year
in the face of rising interest rates, and this did occur with housing
market-related businesses being particularly affected. This was not likely to be
helpful for US based smaller companies, and, as already mentioned, we therefore
favoured other regions in our asset allocation. Japan's economy was stronger in
2006 with signs of a pick-up on the consumer side of the economy, and property
prices rose, although, against our expectations, this did not feed through to
the stock market.

With corporate confidence, liquidity, and stock-markets high, we have seen a
jump in mergers and acquisitions ('M&A') activity affecting both large and small
companies. This has sometimes involved private equity firms which can spot value
that has been ignored by the public market-place. In the present benign
environment, they have been able to take advantage of high levels of leverage.
This has propelled valuations higher across a range of sectors and we have
benefited from this.

Returns from different parts of the world diverged sharply. Japan proved a
particular disappointment to us in the year, with sentiment towards small caps
weak, and stocks were de-rated in contrast to elsewhere in the world. We have
however added to our exposure, although this has yet to pay off given the
underlying weakness of the market, relative underperformance of our portfolio,
and the impact of a weak yen.

Currencies

The differences in regional performance partly reflect the dramatic shifts that
we have seen in the currency markets during the year.

With all parts of the portfolio valued in sterling in the NAV calculation,
currency movements have a direct impact on the reported value of our overseas
portfolios. When sterling is strong, our international portfolios are worth less
when translated to sterling values. In the year under review sterling was
stronger against all the major currencies, most notably versus the yen. All of
the regional managers involved in the management of the portfolio constantly
consider how currency movements will affect the underlying business of investee
companies.

The Board reviews the foreign exchange outlook periodically and this affects
both our asset allocations and our borrowing strategy. As a matter of policy, we
do not attempt to hedge the portfolio against currency movements although we
take the occasional tactical decision to borrow or deposit in foreign currencies
where the Manager and Board consider it appropriate. Shareholders should
therefore be aware that the portfolio can be affected by currency movements and
that in the last year this did hold back NAV growth.

The discount, share buybacks and treasury shares

At the end of April 2007, the discount stood at 6.3% with the debenture at
market value, compared to 6.1% at the end of the prior year and 8.0% at the half
way stage.

Shareholders may recall that at the time of the Tender Offer in 2005, the Board
committed to keeping the discount (with the NAV excluding current period income
and the debenture at market value) close to 5% in normal market conditions. This
is still our objective. The market mechanism by which the Board does this is
through share buybacks and we have no hesitation in buying shares back and
cancelling them when there is no ready buyer in the market place. Indeed, during
the year we bought back shares on 29 separate occasions equating to 3.3% of the
Company's share capital at the beginning of the year.

In view of this, at the annual general meeting ('AGM') we will again seek
shareholder approval to buy back up to 14.99% of the issued share capital and
additionally the power to hold shares bought back in Treasury. Any shares that
are held in Treasury will only be re-issued at a premium to NAV, thereby
ensuring that re-issue will lead to NAV accretion.

Over the last five years the trend has been towards a narrowing of the discount.
Encouragingly, the discount is considerably narrower than both the five year
average and the discount on the average UK smaller company investment trust.

It is important that there is an ongoing demand for shares in the market-place.
To this end, the Board and F&C have proactively committed funds to two direct
marketing campaigns involving targeted mailings to potential new investors
through the F&C plans. We were also keen to capitalise on the good publicity
from winning the Money Observer award mentioned above, and have recently been
advertising the merits of investing in the Company's shares on a number of well
known financial market websites.

F&C's range of investment trust savings schemes have had a successful year in
generating new demand, with the Child Trust Fund being particularly notable in
this regard. Your Company has received a net £1.5m from the schemes over the
year, with the number of shareholders rising by more than 5,000. Approximately
three-quarters of the Company's shares are now held by private individuals
directly or indirectly via private client brokers.

Business review

The Board keeps the Manager's performance in each regional area under review
and, although we do not interfere in stock-picking, we question and challenge
their judgements. This ensures that the Manager is under pressure to produce
good returns on a global basis.

Shareholders will recall that last year, in order to improve risk
diversification, we switched from direct investment in individual Asian smaller
companies to investing in carefully chosen collective schemes. This process has
proceeded to plan. Early results of the change in approach are encouraging. The
Board remains open-minded about the use of collective vehicles and will not
hesitate to use them to generate better performance in a particular region
whenever it feels this is justified.

The Board

This will be my last Statement to you as Chairman of your Company as, due to the
pressure of other commitments, I will be stepping down from the Chair and the
Board immediately after the AGM to be succeeded as Chairman by Anthony Townsend,
who has been on the Board since 2004. Anthony is a former chairman of the
Association of Investment Companies and brings a wealth of expertise to the
role. I am sure that the Company will continue to prosper under his
Chairmanship. I took over as your Chairman in 2004 and the last three years have
not been without excitement. It has been very pleasing to see how well the
Company has done under the management of Peter Ewins and I believe that we are
in good shape going forward.

Dr Bruce Farmer has also decided to retire from the Board after the AGM having
reached the age of 70. Bruce has been on the Board since 1999 and is our Senior
Independent Director and Chairman of the Audit Committee. No-one could have been
more conscientious than Bruce in fulfilling his duties and he has always been a
source of great wisdom to the Board and myself. Dr Franz Leibenfrost will take
over as Senior Independent Director and Les Cullen will take over as Chairman of
the Audit Committee on Bruce's retirement.

I am pleased to announce that two new Directors will be joining the Board from
the conclusion of the AGM on 30 July 2007. They are Andrew Adcock, who is vice
chairman of Citigroup Corporate Broking with more than 30 years of City
experience, and Mark White, a very experienced fund manager who was joint head
of JPMorgan Asset Management in Europe. Both are very strong and capable
individuals and I commend them to you. All boards need to evolve over a period
of time and I believe that your Board will continue to be one of the strongest
in the investment trust sector.

Electronic Communication

We are proposing resolutions at the AGM which will, if passed, allow for the use
of communications with shareholders in electronic form and via the F&C website.
We expect these new communication arrangements to begin next year. We will write
to all shareholders in due course to allow you to elect to continue to receive
hard copies of documents in future.

Outlook

Market valuations continue to look high by historic standards. On an aggregated
basis, smaller companies in a number of markets are rated more highly than
larger stocks and it is therefore easy to view the future with a degree of
caution.

However, the surge in M&A activity implies that confidence among the corporate
community remains high. Interestingly, we are seeing an increasing number of
companies from emerging markets, such as China, Russia and India, actively
looking to acquire companies in developed markets. Private equity funds still
have vast amounts of capital to invest in buyout deals. Corporate profits are
still tending to surprise on the upside.

While smaller stocks as a whole may be looking relatively more expensive than in
recent years, the attraction of the mandate is the range of investment
opportunities open to the Manager. Our current performance gives me confidence
that we can continue to generate above average returns for our growing list of
shareholders.


Gerry Grimstone
Chairman
June 2007



INCOME STATEMENT

for the year ended 30 April                                                 2007                                  2006
                                                     Revenue   Capital    Total*     Revenue      Capital       Total*
                                                      £'000s    £'000s    £'000s      £'000s       £'000s       £'000s

Gains on investments                                       -    21,112    21,112           -       99,506       99,506
Exchange losses                                          (3)     (101)     (104)         (3)        (535)        (538)
Income                                                 3,978         -     3,978       4,912            -        4,912
Management fee                                         (280)     (654)     (934)       (366)        (855)      (1,221)
Performance fee                                            -     (566)     (566)           -            -            -
Other expenses                                         (714)      (54)     (768)       (578)        (605)      (1,183)
Return before finance costs and taxation               2,981    19,737    22,718       3,965       97,511      101,476
Finance costs                                          (348)     (812)   (1,160)       (444)      (1,035)      (1,479)
Return on ordinary activities before taxation          2,633    18,925    21,558       3,521       96,476       99,997
Taxation on ordinary activities                        (363)       114     (249)       (311)           66        (245)
Return attributable to equity shareholders             2,270    19,039    21,309       3,210       96,542       99,752

Return per share - pence                                4.75     39.79     44.54        4.54       136.62       141.16


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

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

A statement of total recognised gains and losses is not required as all gains
and losses of the Company have been reflected in the above statement.


RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS

year ended 30 April 2007                      Called up      Share       Capital                           Total equity
                                                  share    premium    redemption     Capital    Revenue   shareholders'
                                                capital    account       reserve    reserves    reserve           funds
                                                 £'000s     £'000s        £'000s      £'000s     £'000s          £'000s

Balance brought forward at 30 April 2006         12,088     23,132        14,095     170,960      7,377         227,652
Movements during the year ended
    30 April 2007
Dividends paid                                        -          -             -           -    (2,674)         (2,674)
Shares purchased by the Company                   (395)          -           395     (6,713)          -         (6,713)
Return attributable to equity shareholders            -          -             -      19,039      2,270          21,309
Balance carried forward at 30 April 2007         11,693     23,132        14,490     183,286      6,973         239,574


year ended 30 April 2006                       Called up      Share       Capital                         Total equity
                                                   share    premium    redemption    Capital    Revenue  shareholders'
                                                 capital    account       reserve   reserves    reserve          Funds
                                                  £'000s     £'000s        £'000s     £'000s     £'000s         £'000s

Balance brought forward at 30 April 2005          21,231     23,132         4,952    207,658      7,425        264,398
Movements during the year ended
    30 April 2006
Dividends paid                                         -          -             -          -    (3,258)        (3,258)
Shares purchased by the Company                  (9,143)          -         9,143  (133,240)          -      (133,240)
Return attributable to equity shareholders             -          -             -     96,542      3,210         99,752
Balance carried forward at 30 April 2006          12,088     23,132        14,095    170,960      7,377        227,652


BALANCE SHEET
at 30 April                                                                       2007                            2006
                                                                £'000s          £'000s          £'000s          £'000s
Fixed assets
Investments                                                                    246,970                         238,228
Current assets
Debtors                                                          3,050                           1,609
Taxation recoverable                                                19                              10
Cash at bank and short-term deposits                             5,548                           2,652
                                                                 8,617                           4,271
Creditors: amounts falling due within one year
Loans                                                                -                         (3,000)
Other                                                          (6,013)                         (1,847)
                                                               (6,013)                         (4,847)
Net current assets/(liabilities)                                                 2,604                           (576)
Total assets less current liabilities                                          249,574                         237,652
Creditors: amounts falling due after more
   than one year
Debenture                                                                     (10,000)                        (10,000)
Net assets                                                                     239,574                         227,652

Capital and reserves
Called up share capital                                                         11,693                          12,088
Share premium account                                           23,132                          23,132
Capital redemption reserve                                      14,490                          14,095
Capital reserves                                               183,286                         170,960
Revenue reserve                                                  6,973                           7,377
                                                                               227,881                         215,564
Total equity shareholders' funds                                               239,574                         227,652
Net asset value per ordinary share - pence                                      512.21                          470.83


CASH FLOW STATEMENT
for the year ended 30 April                                                    2007                                2006
                                                            £'000s           £'000s            £'000s            £'000s
Operating activities
Investment income                                            3,473                              4,264
Interest received                                              215                                689
Stock lending fees                                              86                                 91
Underwriting commission                                          -                                  1
Fees paid to the Manager                                     (899)                            (1,305)
Fees paid to the Directors                                   (119)                              (104)
Other cash payments                                          (344)                              (677)
Net cash inflow from operating activities                                     2,412                               2,959
Servicing of finance
Interest paid                                              (1,168)                            (1,503)
Cash outflow from servicing of finance                                      (1,168)                             (1,503)
Taxation
Overseas tax paid                                            (271)                              (293)
Overseas tax recovered                                          13                                 51
Net tax paid                                                                  (258)                               (242)
Financial investment
Purchases of equities and other investments               (99,982)                          (100,997)
Sales of equities and other investments                    114,532                            244,636
Other capital charges and credits                             (66)                              (595)
Net cash inflow from financial investment                                    14,484                             143,044
Equity dividends paid                                                       (2,674)                             (3,258)
Net cash inflow before use of liquid
   resources and financing                                                   12,796                             141,000
Management of liquid resources
(Increase)/decrease in short-term deposits                                  (1,000)                               3,993
Financing
Net loans repaid                                           (3,000)                           (12,936)
Purchase of ordinary shares                                (6,595)                          (133,240)
Cash outflow from financing                                                 (9,595)                           (146,176)
Increase/(decrease) in cash                                                   2,201                             (1,183)


Notes

1    RETURN PER ORDINARY SHARE

Revenue return

The revenue return per share is based on the revenue return attributable to
equity shareholders of £2,270,000 profit (2006: £3,210,000 profit).

Capital return

The capital return per share is based on the capital return attributable to
equity shareholders of £19,039,000 profit (2006: £96,542,000 profit).

Weighted average ordinary shares in issue

Both the revenue and capital returns per share are based on a weighted average
of 47,845,186 ordinary shares in issue during the year (2006: 70,665,432).

2    DIVIDENDS

The Directors recommend a final dividend in respect of the year ended 30 April
2007 of 3.16p, payable on 6 August 2007 to all shareholders on the register at
close of business on 6 July 2007. The recommended final dividend is subject to
approval by shareholders at the annual general meeting and has not been included
as a liability in these results.

3    FINANCIAL INFORMATION

The above financial information comprises non-statutory accounts within the
meaning of section 240 of the Companies Act 1985. The financial information for
the year ended 30 April 2006 has been extracted from published accounts for the
year ended 30 April 2006 that have been delivered to the Registrar of Companies
and on which the report of the auditors was unqualified.

4    ANNUAL GENERAL MEETING

The Annual General Meeting will be held at the Chartered Accountants' Hall, One
Moorgate Place, London EC2 on 30 July 2007, at 12 noon.

5    REPORT AND ACCOUNTS

The Report and Accounts will be posted to shareholders at the beginning of July
2007.  Copies may be obtained during normal business hours from the Company's
Registered Office, Exchange House, Primrose Street, London EC2A  2NY.

By order of the Board
F&C Management Limited, Secretary
21 June 2007




                      This information is provided by RNS
            The company news service from the London Stock Exchange