Final Results

British SmallerTechCompaniesVCT2PLC
25 March 2002



                 BRITISH SMALLER TECHNOLOGY COMPANIES VCT 2 PLC



           Preliminary results for the period ended 31 December 2001



Financial highlights:



•        £375,000 invested in three companies

•        Income £288,000

•        Net revenue return before tax £35,000

•        Total return per share (0.48p)

•        Net Assets £6,441,000

•        Net asset value per share 93.7p



British Smaller Technology Companies VCT 2 plc is the successor to British
Smaller Technology Companies VCT plc, the venture capital trust specialising in
growing smaller technology companies. It is following a similar investment
strategy to its forerunner, which is now fully invested, and is advised by
Yorkshire Fund Managers Limited.



The Chairman, Sir Andrew Hugh Smith, said that three investments, totalling
£375,000, had been made during the period to 31 December 2001.  They were in
Tamesis Limited, a company that designs, develops and sells financial software,
Amino Holdings Limited , a developer and licensor of technologies for the secure
and rapid development of networked multimedia solutions, and Syngenix Limited, a
company which has patented technology that targets drug delivery using nerve
cell transportation.



"The investment portfolio is still at a very early stage in its development," he
said.



Phil Cammerman, Managing Director of Yorkshire Fund Managers Limited, said, "
Market sentiment toward the valuation of technology-based companies looks set to
remain weak for some time yet and should provide the opportunity for an enhanced
benefit to shareholders over that time through increased capital growth."





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



I am pleased to present the first Annual Report and Accounts to the Shareholders
of British Smaller Technology Companies VCT 2 plc for the period from 4 October
2000 to 31 December 2001. The first allotment of shares under the initial
subscription was made on 29 December 2000 with admittance to a full listing on
the London Stock Exchange taking place

on 12 April 2001.



The reporting period suffered from an exceptionally unfavourable environment.
Led by the United States, activity in the world economy was in a period of
decline. The full effects of the decline in valuations of the IT and Telecom
sectors were felt and business confidence and investment spending fell very
sharply. This was accentuated by the events of 11 September. The difficult
economic environment was inevitably reflected in financial markets, most sharply
in the case of small and emerging companies. In the UK, the FTSE AIM index fell
38% and the FTSE Techmark100 index 43% during 2001.



This situation reflected the market's return to more realistic valuations of
emerging and, particularly, technology-based companies even more so than the
concerns at the effects of an economic slow down. The longer-term prospects of
the technology sector remain intact although the decline in confidence and
activity has presented many companies with short-term difficulties. A beneficial
effect has been that we are now able to negotiate with potential investee
companies at much more attractive valuations.



Investments

In my interim report I outlined the two investments that had been made at that
date, £125,000 in Amino Holdings Limited and £150,000 in Tamesis Limited. Both
investments were made as part of a larger funding package and alongside monies
from other funds under the management of your Board's Investment Adviser,
Yorkshire Fund Managers Limited.



Since that date one further investment has been completed bringing total
investments made to £375,000. On 7 September, £100,000 was invested in Syngenix
Limited by way of £90,000 convertible unsecured loan stock and £10,000 in
Ordinary shares representing 1.66% of the issued Ordinary share capital. This
investment was made alongside a further £100,000 from British Smaller Technology
Companies VCT plc and was part of a £5.5m start-up funding package.

Syngenix's business is the delivery of drugs and probes to the nervous system.



The investment portfolio is still at a very early stage in its development.
However, the events of 11 September had a material effect on the business of
Tamesis Limited, a company that designs, develops and sells financial software
to the risk management divisions of global investment banks. As a result your
Board has decided to make a 50% provision against the cost of this investment.



Financial Results and Dividend

The net revenue return after tax for the period was £28,000 on total revenue of
£288,000. All income was derived from surplus liquid funds awaiting investment.
The total return was a loss of £27,000 following the write down of the
investment in Tamesis.



No dividend is proposed in line with the stated aim of the Company. The
Company's investment policy is geared toward medium and longer term capital
gains rather than short term revenue returns. Thus, as the Company moves toward
full investment, it is expected that revenue returns will fall as the level of
liquid funds reduces. It is anticipated that dividend returns to shareholders
will only be made once capital gains begin to materialise.

The net asset value at 31 December 2001 was 93.7p per Ordinary share.



Fund Raising

As stated in my interim report, the conditions for raising funds in the current
market were, and remain, difficult. The fund raising closed on 31 May 2001 with
a total of £6.7m committed by Shareholders. Following further issues of shares
under the directors' authority to allot, total funds raised from Shareholders
was £6.8m from this initial offer. A new prospectus to raise additional
Shareholder funds was issued on 23 November 2001 and this is ongoing. To date
just over £0.5m has been raised under this new issue.



Outlook

Yorkshire Fund Managers Limited continues to report a strong flow of enquiries
from companies that meet the criteria for funding laid out in the prospectus.



The continued weak market sentiment toward technology-based companies is
providing your Company with opportunities toinvest in businesses with real
innovative advantage at attractive valuations, thus increasing the potential for
future capital gains.



Sir Andrew Hugh Smith

Chairman

25 March 2002




Statement Of Total Return

(Incorporating the Revenue Account)



For The Period Ended 31 December 2001


                                                                                  Period ended

                                                                                 31 December 2001
                                                  Notes               Revenue          Capital       Total

                                                                         £000             £000        £000

Net losses on investments                                                   -             (13)        (13)
Income                                                                    288                -         288
Investment advisory fee                                                 (114)             (49)       (163)
Other expenses                                                          (139)                -       (139)

                                                                       ------           ------      ------
Net return on ordinary activities before
taxation                                                                   35             (62)        (27)
Tax on ordinary activities                                 2              (7)                7           -

                                                                       ------           ------      ------
Net return on ordinary activities after
taxation                                                                   28             (55)        (27)
Dividends in respect of equity shares                      3                -                -           -

                                                                       ------           ------      ------
Transfer to (from) reserves                                                28             (55)        (27)

                                                                         ====             ====        ====
Return per Ordinary share Basic and fully
diluted                                                    4            0.49p          (0.97)p     (0.48)p



Notes



The revenue column 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 revenue return on ordinary activities
before taxation and the transfer to revenue reserves for the financial period
and their historic cost equivalents.


Balance Sheet

At 31 December 2001


                                                            Notes                                     2001

                                                                                                      £000
Fixed Assets

Investment Portfolio                                                                                   300

                                                                                                    ------
Current Assets

Investments                                                                                          5,631
Debtors                                                                                                109
Cash                                                                                                   437

                                                                                                    ------
                                                                                                     6,177
Creditors: amounts payable within one year                                                            (36)

                                                                                                    ------
Net Current Assets                                                                                   6,141

                                                                                                    ------
Total Net Assets                                                                                     6,441

                                                                                                      ====
Capital and Reserves

Called up share capital                                                                                688
Share premium account                                                                                5,780
Capital reserve
Realised                                                                          30
Unrealised                                                                      (85)
Revenue reserve                                                                                       (55)
                                                                                                        28

                                                                                                    ------
Equity shareholders' funds                                                                           6,441

                                                                                                      ====
New asset value per Ordinary share                                                                   93.7p

                                                                                                      ====




Cash Flow Statement

For the period ended 31 December 2001


                                                                       Notes                  Period ended
                                                                                        
                                                                                           31 December 2001

                                                                                                       £000
Net cash outflow from operating activities                                                             (87)

                                                                                                     ------
Investing activities

Purchase of investments                                                                               (375)

                                                                                                     ------
Net cash outflow before management of liquid resources and                                            (462)
financing
                                                                                                     ------
Management of liquid resources

Purchase of fixed interest government stocks                                                       (17,524)
Proceeds from the sale of fixed interest government stocks                                           11,955

                                                                                                     ------
Net cash outflow from management of liquid resources                                                (5,569)

                                                                                                     ------
Financing

Issue of Ordinary shares                                                                              6,876
Issue of expenses                                                                                     (408)

                                                                                                     ------
Net cash inflow from financing                                                                        6,468

                                                                                                     ------
Increase in cash                                                                                        437

                                                                                                       ====




 Notes To The Financial Statements



1.    Basis of Reporting

This preliminary announcement does not constitute statutory accounts within the
meaning of Section 240 of the Companies Act 1985.  The announcement has been
agreed with the Company's auditors for release.  The financial information has
been prepared on a basis consistent with the previous year.

Comparative figures for the year ended 31 December 2000 have been extracted from
the statutory accounts on which the auditors gave an unqualified report and
which did not contain a statement under Sections 237(2) or 237(3) of the
Companies Act 1985.  Those accounts have been filed with the Registrar of
Companies.  The statutory accounts for the year ended 31 December2001 will be
delivered to the Registrar of Companies following the Company's Annual General
Meeting.



2.    Taxation Charge


                                                                  2001
                                                Revenue         Capital           Total

                                                   £000            £000            £000
Corporation tax payable at 20%                        7             (7)               -

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





3          Dividends


There is no proposed dividend.



4.    Return per Ordinary share

The basic return per Ordinary share is based on the net revenue return from
ordinary activities after tax of £28,000 and on 5,682,000 shares, being the
weighted average number of shares in issue during the period.



There is no difference between the basic return per Ordinary share and the fully
diluted return per Ordinary share.


5.    Net asset value per Ordinary share

The net asset value per Ordinary share is calculated on attributable assets of
£6,441,000 and 6,876,133 shares in issue at the period end.


6.        Annual General Meeting


Copies of the full financial statements for the period ended 31 December 2001
are expected to be posted to shareholders on 27 March 2002 and will be available
to the public at the registered office of the Company at Saint Martins House,
210-212 Chapeltown Road, Leeds, LS7 4HZ thereafter.  The Company's AGM is due to
be held at 12.30 p.m. on 10 May 2002 at 42 Brook Street, London, W1K 5BB.









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