Interim Management Statement

F&C U.S. Smaller Companies PLC
10 April 2008

F&C US Smaller Companies PLC

Interim Management Statement

For the three month period to 31 March 2008



Investment Objective

To achieve long-term capital growth by investing in a diversified portfolio of
quoted US smaller and medium sized companies.





Performance summary


                                             31 March 2008           31 December 2007          Movement


Net assets                                         £56.17m                   £61.59m           -8.80%


Net asset value (NAV) per share                    269.73p                   288.06p           -6.36%

Share price                                        244.00p                   267.25p           -8.70%

Russell 2000 Index

     (sterling adjusted)                            346.15                    384.82          -10.05%


Discount to NAV per share                             9.5%                      7.2%







Three month review



The NAV per share fell 6.4% in the three months to 31 March 2008. The
performance of the NAV per share was above that of the benchmark, the Russell
2000 Index (sterling adjusted), which declined by 10.1%.



The value investing style, which is the approach used by the Company, returned
to favour. Performance was helped by holdings in oil and coal-related stocks,
which did well.



In the quarter ten new investments were made in areas including agricultural
commodities, legal claims, cellular phone services, home nursing and interest
rate sensitive stocks. Profits were taken in oil and coal-related stocks and
rural hospitals, which had done well.



The Company is not currently geared.



Since 31 December 2007, 575,446 shares have been bought back for cancellation at
a cost of £1,384,000 and an average discount of 11.9%.




Ten Largest Holdings




 31 March 2008    31 December 2007   Company                                           Percentage of total
                                                                                               investments
                                     Description
       1                  5          Cousins Properties                                                2.3
                                     Real estate investment trust

       2                  1          Community Health Systems                                          2.2
                                     Rural hospital operator

       3                  3          Premiere Global Services                                          2.1
                                     Outsourced communication services

       4                  4          Harvest Natural Resources                                         2.1
                                     Oil and gas exploration and development

       5                 (-)         Universal Truckload Services                                      2.0
                                     Non-asset based transportation services

       6                 (-)         ACI Worldwide                                                     2.0
                                     Software for electronic funds transfer

       7                 (-)         Beacon Roofing Supply                                             2.0
                                     Roofing materials distribution

       8                  2          Five Star Quality Care                                            1.9
                                     Assisted living facilities

       9                 (-)         Crawford & Company                                                1.9
                                     Insurance and legal claims services

       10                (-)         America's Car-Mart                                                1.8
                                     Used car sales and finance







Industrial Classification


                                                    31 March 2008                 31 December 2007

                                              Percentage of total  Percentage of total investments
                                                      investments
Financial Services                                           20.7                             21.4
Consumer Discretionary                                       19.3                             16.8
Producer Durables                                            13.3                             13.5
Technology                                                    9.4                              9.8
Materials & Processing                                        8.5                              9.2
Healthcare                                                    7.0                              9.9
Other Energy                                                  6.5                              8.9
Autos & Transportation                                        6.4                              5.3
Consumer Staples                                              4.5                              1.2
Utilities                                                     3.6                              2.3
Other                                                         0.8                              1.7




Outlook



The Fed has taken further decisive action, including interest rate cuts, other
measures to improve the liquidity of money markets and banks, and the
orchestration of a rapid rescue of Bear Stearns by JP Morgan. An additional
positive factor for the stability of the financial system was the successful
capital-raising by Lehman Brothers. However, house prices continue to fall and
the problems affecting, for example, bond insurers are not resolved, problems
that pose additional threats to financial institutions' balance sheets. The US
economy may slip into recession later in the year. Interest rate cuts by the Fed
make a recovery in 2009 more likely, the anticipation of which should help the
share prices of smaller companies.



Further information including a monthly update regarding the Company can be
found at www.fandc.com.



By order of the Board

F&C Management Limited, Secretary

10 April 2008


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