Interim Results

British Smaller Companies VCT PLC
5 December 2001




                       BRITISH SMALLER COMPANIES VCT PLC

       Unaudited interim results for the 6 months to 30 September 2001


  * Ongoing active investment/disposal programme
  * £1.9m invested in 7 companies
  * £0.8m disposals from 6 companies
  * 1.1p dividend
  * Outlook positive for the longer term


British Smaller Companies VCT plc ('the Company') today announces its
unaudited interim results for the six months to 30 September 2001.



FINANCIAL HIGHLIGHTS


                                            Unaudited   Unaudited       Audited
                                          6 months to 6 months to  12 months to
                                         30 September          30 31 March 2001
                                                 2001   September
                                                             2000

Gross revenue                                £416,000    £373,000      £730,000
Revenue return after tax:                    £252,000    £195,000      £376,000
Revenue return per share:                       1.60p       1.23p         2.38p
Total return per share:                       (4.20)p     (3.39)p       (4.38)p
Total dividend:                                  1.1p        1.2p          2.3p
Net assets:                                   £12.22m     £13.42m       £13.09m
Net asset value per share:                      77.7p       85.0p         82.9p
Number of venture capital
investments:                                       32          24            28
Value of venture capital
investments:                                   £9.71m      £8.55m        £9.61m



Announcing the results, the Chairman, Sir Andrew Hugh Smith, said the current
market presented opportunities to invest at attractive valuations.  However,
given the existing business uncertainty, the portfolio had been valued
cautiously for the period.  Whilst some companies in the portfolio were
showing good progress, it was felt that this would be better assessed at the
end of the full year, when the impact on UK businesses of recent events would
be clearer.





INVESTMENTS



A total of £1.9m was invested in seven companies during the period, £1.4m of
which was invested in innovative businesses involved in the application of new
technologies.  These included £500,000 in Weston Antennas Limited, a
manufacturer of large diameter satellite dishes for the communications market;
  £500,000 in Cozart Bioscience Limited, a specialist medical diagnostics
company; £350,000 in Tamesis Limited, a company  which develops and sells real
time trading software for investment banks; and a further round of funding for
Imerge Limited, which develops next generation media technology software for
licensing to Original Equipment Manufacturers (OEMs) and hi-fi manufacturers.





Three investments were made in more established businesses with strong growth
potential - £225,000 in Tikit plc on its admission to AIM; a further £170,000
in Oasis Healthcare plc, the AIM listed dental services provider; and £128,000
in Synergy Healthcare plc on its admission to AIM.







REALISATIONS



There were six full or partial disposals during the period.  Just before the
period end, half of the holding in Synergy Healthcare plc was sold for a £
21,000 profit; GB International Limited was sold to a trade buyer, resulting
in a profit of £260,000; Denison Mayes Group Limited was sold back to
management and this disposal will represent a net accounting gain of £200,000.
  The other disposals were in part holdings in AIM stocks - CRC Group plc,
Connaught plc and Oasis Healthcare plc - resulting in realised gains of £
107,000.







PERFORMANCE



The Company continues to comfortably exceed the venture capital trust
legislative compliance targets in relation to investments held in qualifying
companies and the percentage of those qualifying holdings in ordinary shares.







DIVIDEND



An interim dividend of 1.1p per share (2000: 1.2p) will be paid on 21 December
2001 to shareholders on the register on 14 December 2001.







OUTLOOK



Commenting on the Company's prospects for the current year, the Chairman said:



'The current economic outlook is uncertain and presents challenges to actual
and potential investee companies.  The fall in quoted market prices has led to
many companies reappraising their financing strategy resulting in them turning
increasingly to venture capital funding rather than the IPO or trade sale
routes they may otherwise have taken. As a result, Yorkshire Fund Managers
Limited is maintaining its flow of enquiries and pricing of these deals is
becoming more realistic.  Closing them, however, is taking much longer.



Whilst, in the short-term, this has implications for the valuation of the
existing portfolio it also presents opportunities to invest in businesses
offering real growth potential at attractive valuations and thus offers the
potential for increased capital gains in the longer term.'



For further information, please contact:



Phil Cammerman, Yorkshire Fund Managers Ltd           Tel:  [phone]

David Hardy, Binns & Co                               Tel:  [phone]

Simon Mountford, Simon Mountford Communications       Tel:  [phone]






Chairman's statement



During the six-month period under review your Board has continued to implement
the policy announced in last year's interim statement of extending the
investment criteria to include businesses involved in the development and
application of new technologies.  In addition, your Board and the Company's
Investment Adviser, Yorkshire Fund Managers Limited, have been actively
looking at other strategies for improving the underlying net asset value of
the Company.  A realisation programme has been put in place to unlock
under-performing investments and release value in more mature investments.
The realisations will be reinvested in accordance with the revised investment
criteria into companies with greater growth potential.

The events of 11 September will inevitably have a major impact on the
performance of the portfolio.  Whilst there were already clear indications
before that date of recessionary trends, these are likely to have been
increased by these events and business and consumer confidence has
deteriorated quite sharply. A lower level of economic activity will have a
direct and indirect impact on the reported net asset value of your Company.
Some companies have been hit directly, others, particularly the AIM-listed
investments, have been affected through the general fall in Stock Market
prices, although the Board's policy of limiting your Company's exposure to AIM
has kept this to a manageable level.  Indeed, we had already began to reduce
this exposure prior to 11 September through the part disposal of certain
stocks in order to crystallise profits and release cash for other unquoted
investment opportunities with greater growth potential.

Given the current climate of business uncertainty, your Board has been
cautious in assigning values to the underlying investments at this interim
stage of the year.  Whilst there are companies showing good  progress within
the portfolio it is felt that this will be better assessed at the full year
end when the impact of interest rate reductions coupled with recent events on
UK businesses will be clearer.

In the light of these comments, part provisions totalling £500,000 have been
made against two investments during the period.  Apart from this, there has
been very little change in the valuation of the unquoted part of the
portfolio.  The AIM investments have been valued in relation to their
mid-market price at the period end.  This section of the portfolio has shown a
15% decrease on a like-for-like basis since last reported on 31 March 2001.





Investments



During the period we invested a total of £1.9m in 7 companies.  £1.4m was
invested in businesses involved in the application of new technologies.

Weston Antennas Limited manufacture large diameter satellite dishes for the
communications market. The investment of £500,000 was made to enable the
company to increase the size of its manufacturing facility, allowing it to
produce larger dishes and higher precision products.

£500,000 was invested in Cozart Bioscience Limited, a specialist medical
diagnostics company active in the areas of drugs abuse and point of care
testing. Our investment was made to assist in the roll-out of the new handheld
point of care testing product, RapiScan. The company was recently awarded a
major contract by the UK Home Office for testing arrestees detained in Police
custody.

Tamesis Limited develop and sell real time trading software for investment
banks.  The software allows consolidation of risk data and provides clients
with a capability that can change the way in which they view their own risk
position and therefore significantly enhance the way in which they handle
their investment business. £350,000 was invested to further product
development and provide working capital.

As part of the next round of fundraising, your Company invested £57,000 in
Imerge Limited. Since the initial investment of £250,000 last December the
company, which develops Next Generation Media Technology for licensing to
Original Equipment Manufacturers (OEMs) and to hi-fi manufacturers, has
continued to progress.  This latest funding, in the form of convertible debt,
was part of a £2.5m package to support the launch of additional products and
services.

As well as the investments in these technology-based companies investments
were also made in more established growth potential businesses. £225,000 was
invested in Tikit plc on its admission to AIM.  The company provides a
comprehensive range of services to help law firms make the most of their
investment in information technology. As well as helping to implement complete
solutions for its clients, Tikit has provided on-going support and service to
many of the leading law firms for a number of years.

A further £170,000 was invested in Oasis Healthcare, the AIM listed dental
services provider. This was invested as part of a £3.4m fundraising package to
finance the continued expansion and development of the company's estate of
dental practices.

£128,000 was invested in Synergy Healthcare plc on its admission to AIM. Just
prior to the end of the reporting period, half of the holding was sold
resulting in a profit of £21,000.  Since the period end the remaining holding
has been sold for a further profit of £31,000.





Realisations



In addition to the disposal of the recently acquired investment in Synergy
Healthcare plc, there were five other full or partial disposals in the period.
  GB International Limited was sold to a trade buyer resulting in a profit to
your Company of £260,000 - corresponding to a 22% compound return over the 4
years of the investment.

The investment in Denison Mayes Group Limited, a company that had continued to
struggle in difficult trading conditions, was sold back to management in
September as part of a financial restructuring plan.  Your company received £
100,000 in loan interest arrears and £100,000 for its ordinary share
investment. The preference shares were written off as was £200,000 of loan.
The remaining £100,000 of loan, which remains provided against, has been
rescheduled to commence repayment in August 2006. As the investment, including
interest arrears, had been fully provided for, the disposal represents a net
accounting gain of £200,000.

The other disposals were in relation to part holdings in AIM stocks.  These
were CRC Group plc, Connaught plc and Oasis Healthcare plc and resulted in
realised gains of £107,000.





Financial results and dividend



The net revenue return after tax was £252,000 (2000: £195,000) equivalent to
1.60p per Ordinary share (2000: 1.23p).  Gross revenue was up 11% to £416,000
and expenditure reduced 9% to £137,000.

The total return, after taking account of investment valuation movements and
expenses charged to capital account, was a loss of £662,000 (2000: £537,000).
This reflects the unquoted investment write downs and the fall in AIM stock
values.

Your Board has recommended an interim dividend of 1.1p per share. The dividend
will be paid on 21 December 2001 to shareholders on the register on 14
December 2001.

I can report that your Company continues to comfortably exceed the venture
capital trust legislative compliance targets in relation to investments held
in qualifying companies and the percentage of those qualifying holdings in
ordinary shares.





Outlook



The current economic outlook is uncertain and presents challenges to actual
and potential investee companies and to your Company itself.  The fall in
quoted market prices has led to many companies reappraising their financing
strategy resulting in them turning increasingly to venture capital funding
rather than the IPO or trade sale routes they may otherwise have taken.  As a
result, Yorkshire Fund Managers Limited is maintaining its flow of enquiries
and pricing of these deals is becoming more realistic.  Closing them, however,
is taking much longer.

Whilst in the short-term this has implications for the valuation of the
existing portfolio it also presents opportunities to invest in businesses
offering real growth potential at attractive valuations and thus offers the
potential for increased capital gains in the longer term.



Sir Andrew Hugh Smith

5 December 2001




Summarised unaudited statement of total return


                                               Unaudited    Unaudited   Audited
                                                6 months     6 months      Year
                                                   ended        ended     ended
                                            30 September 30 September  31 March
                                                    2001         2000      2001
                                     Notes          £000         £000      £000
Revenue

Gross revenue                                        416          373       730
Administrative expenses                            (137)        (151)     (306)
Taxation                             2              (27)         (27)      (48)

                                                  ------       ------    ------
                                                     252          195       376

                                                  ------       ------    ------


Capital

Net realised (losses) gains                        (122)          373       286
Net unrealised losses                              (704)      (1,005)   (1,154)
Management fee allocated to capital                (115)        (125)     (243)
Tax effect of capital items                           27           25        42

                                                  ------       ------    ------
                                                   (914)        (732)   (1,069)

                                                  ------       ------    ------

Total return                                       (662)        (537)     (693)

                                                   =====        =====     =====


Appropriated:

Revenue
  Dividend payable on Ordinary                       173          189       363
  shares
  Transfer to revenue reserve                         79            6        13

                                                  ------       ------    ------
                                                     252          195       376

                                                   =====        =====     =====


Capital
  Decrease on reserves                             (914)        (732)   (1,069)

                                                   =====        =====     =====

Total return per Ordinary share
  Revenue                                          1.60p        1.23p     2.38p
  Capital                            3           (5.80p)      (4.62p)   (6.76p)

                                                  ------       ------    ------
                                                 (4.20p)      (3.39p)   (4.38p)

                                                   =====        =====     =====




Notes

The revenue section of this statement is the profit and loss account of the
company.


All activity has arisen from continuing operations.



There is no difference between the net return on ordinary activities before
taxation and the transfer to revenue reserves for the financial period and
their historic cost equivalents.





Unaudited balance sheet


                                                 Unaudited   Unaudited  Audited
                                                        30          30 31 March
                                                 September   September
                                                      2001        2000     2001
                                      Notes           £000        £000     £000
Fixed assets
Investment portfolio                                 9,710       8,553    9,605

                                                    ------      ------   ------

Current assets
Short-term investments                               1,681       4,160    2,698
Debtors                                                445         328      353
Cash and short-term deposits                           606         622      665

                                                    ------      ------   ------
                                                     2,732       5,110    3,716

Creditors: Amounts payable within one                (219)       (246)    (235)
year
                                                    ------      ------   ------

Net current assets                                   2,513       4,864    3,481

                                                    ------      ------   ------

Total net assets                                    12,223      13,417   13,086

                                                     =====       =====    =====

Capital and reserves

Called up share capital                              1,573       1,578    1,578
Capital redemption reserve                              14           9        9
Capital reserve                                    (3,201)     (1,950)  (2,287)
Special reserve                                     13,741      13,770   13,769
Revenue reserve                                         96          10       17
                                                    ------      ------   ------
Equity shareholders' funds                          12,223      13,417   13,086

                                                     =====       =====    =====

Net asset value per Ordinary share    4              77.7p       85.0p    82.9p





Unaudited cash flow statement


                                                  Unaudited Unaudited  Audited
                                                   6 months  6 months     Year
                                                      ended     ended    ended
                                                         30        30 31 March
                                                  September September
                                                       2001      2000     2001
                                                       £000      £000     £000

Net cash inflow from operating activities               114       302      362

                                                     ------    ------   ------

Taxation
Tax repayment received                                  151        71       70

                                                     ------    ------   ------

Investing Activities

Purchase of investments                             (1,930)   (1,800)  (3,237)
Proceeds from disposal of investment                    801     1,013    1,147

                                                     ------    ------   ------
Net cash outflow from investing activities          (1,129)     (787)  (2,090)

                                                     ------    ------   ------

Equity dividends paid to shareholders                 (174)     (253)    (442)

                                                     ------    ------ --------

Net cash outflow before use of liquid
resources and financing                             (1,038)     (667)  (2,100)

                                                     ------    ------   ------


Management of liquid resources

Proceeds from the sale of fixed interest
government stocks                                    1,007     1,313    2,790

                                                     ------    ------   ------

Financing

Purchase of own shares                                 (28)      (45)     (46)

                                                     ------    ------   ------

(Decrease) increase in cash                            (59)       601      644

                                                     ------    ------   ------








Notes to the financial statements




Reporting



The unaudited interim financial statements have been prepared on a basis
consistent with the statutory financial statements for the year ended 31 March
2001.  The interim financial statements, which have been approved by the
directors, are unaudited and do not constitute full financial statements as
defined in section 240 of the Companies Act 1985.  The comparative figures for
the year ended 31 March 2001 do not constitute full financial statements and
have been extracted from the Company's financial statements for the year ended
31 March 2001 which have been reported upon without qualification by the
auditors and have been delivered to the Registrar of Companies.



2 Taxation charge


                                                Unaudited    Unaudited  Audited
                                                 6 months     6 months     Year
                                                    ended        ended    ended
                                             30 September 30 September 31 March
                                                     2001         2000     2001
                                                     £000         £000     £000

UK taxation based on net revenue for the
period:
Corporation tax at 20% (2000/2001 : 20%)               27           27       48
Allocated to capital reserve                         (27)         (25)     (42)

                                                   ------       ------   ------

Net charge                                              -            2        6

                                                    =====        =====    =====





3 Return per Ordinary share



The return per share is based on net revenue from ordinary activities after
tax attributable to shareholders of £252,000 (March 2001: £376,000) and on
15,752,371 shares (March 2001: 15,798,161), being the weighted average number
of shares in issue during the period. There is no difference between the
return per share and the fully diluted return per share in either period.



4 Net asset value per Ordinary share



The net asset value per Ordinary share is calculated on attributable assets of
£12,223,000 and 15,732,838 shares in issue at the period end (31 March 2001:
assets of £13,086,000 and 15,777,838 shares).



5 Interim Report and Accounts



Copies of the interim report are being posted to shareholders and can be
obtained from the Company's registered office: Saint Martins House, 210-212
Chapeltown Road, Leeds, LS7 4HZ thereafter.



Unaudited interim accounts will be lodged with the Registrar of Companies.