Portfolio Update

BLACKROCK SMALLER COMPANIES TRUST plc

All information is at 31 May 2011 and unaudited.

Performance at month end is calculated on a capital only basis

                              One     Three       One      Three      Five      
                            Month    Months      Year      Years     Years     
                                                                                
Net asset value             -1.2%      1.3%     56.7%      41.2%     74.7%     
Share price                  0.4%     -3.5%     61.9%      42.3%     76.4%     
HGSC ex Inv Trust + AIM*    -1.0%      1.4%     28.2%      11.9%      6.9%      

Sources: BlackRock and DataStream

*With effect from 1 September 2007 the Hoare Govett Smaller Companies plus AIM
(ex Investment Companies) Index replaced the FTSE SmallCap Index (ex Investment
Companies) as the Company's benchmark. For the five year period the above index
has been blended to reflect this.

At month end                                                                  
                                                                              
Net asset value Capital only (debt at par value):           622.11p           
Net asset value Capital only (debt at fair value):          617.89p           
Net asset value incl. Income (debt at par value):           625.58p**         
Net asset value incl. Income (debt at fair value):          621.35p**         
Share price:                                                523.00p           
Discount to Capital only NAV (debt at par value):           15.9%             
Discount to Capital only NAV (debt at fair value):          15.4%             
Net yield:                                                  1.3%              
Total assets:                                               £325.5m^          
Gearing incl. Income:                                       8.6%              
Ordinary shares in issue:                                   47,879,792^^      

**includes net revenue of 3.47p.
^includes current year revenue.
^^excludes 2,113,731 shares held in treasury.
 
Ten Largest Sector                                                         
Weightings                                 % of Total Assets
                                                                           
Software & Computer Services                             9.8
Financial Services                                       9.5
Support Services                                         9.0
Industrial Metals & Mining                               8.5
Electronic & Electrical Equipment                        7.6
Oil & Gas Producers                                      6.8
Media                                                    5.8
Industrial Engineering                                   5.8
Pharmaceuticals & Biotechnology                          5.2
General Retailers                                        4.4
                                                        ----
Total                                                   72.4
                                                        ====
 
Ten Largest Equity Investments (in alphabetical order)

Company

Abcam Group
Aveva Group
Bellway
City of London Investment Group
Domino Printing Sciences
Fidessa group
Hargreaves Services
Hutchison China Meditech
ITE Group
Oxford Instruments

Commenting on the markets, Mike Prentis, representing the Investment Manager
noted:

During May, the Company's NAV per share fell by 1.2% on a capital only basis,
slightly behind the benchmark index which fell by 1.0%. The FTSE 100 Index fell
by 1.3%.

Markets are jittery and trendless at present and have been for several months.
We think we will need to see confidence that the debts of peripheral European
economies can be managed without too much of a strain being imposed on core
Europe, clearer signs that the US economy is not faltering, improved confidence
that China can sustain reasonable growth levels, and a fall in the oil price.
None of these will be easily achieved. However, we do not expect a collapse in
world GDP growth, more a hiccup in the strengthening of global growth.
Accordingly, we see this as a time to take less sector risk, but to retain
gearing in anticipation of better share price performances in the autumn.

It is clear that UK small and mid cap investors have been heavily overweight
international industrials for some time and this has been a successful stance.
However, it feels as though this position is now being unwound and industrials
are now being sold. Over the last 3 months we have reduced our exposure to
industrials by selling holdings in Cookson, Morgan Crucible and Spectris. We
prefer holdings such as Spirax-Sarco, Oxford Instruments and Renishaw, which
remain large holdings. We took money out of several other holdings because
valuations were beginning to look quite full, but in general we feel the
valuations of our portfolio holdings remain attractive relative to growth
prospects.

We decided to reduce our underweight UK consumer position; in particular we
reduced our underweight exposure to housebuilders, buying holdings in two South
East focused groups, Berkeley Group and Bovis Homes. We also bought holdings in
two retailers, Majestic Wine and Dunelm. The rationale for this move is that we
expect the recovery in the UK economy to be more clearly entrenched in 2012 and
this should help consumer confidence to rebuild. However, we still expect weak
GDP growth relative to many other parts of the world.

We have continued to look for international growth stocks, especially those
exposed to the more reliably growing emerging markets. In April, we added a
holding in International Personal Finance, and in May in Oceans Wilson. Oceans
Wilson is the holding company for Wilson Sons, a long established port operator
and port services business in Brazil. It stands to benefit from the increasing
investment in Brazil's offshore oil industry and eventual increased oil
production.

Our largest contributor to relative performance in May was from Fidessa, also
our largest holding, although there was no news from the company. Results and
trading statements in May from our larger holdings were, in general, very good.
We also had many upbeat meetings with management, notably with the managements
of Victrex, Aveva, Oxford Instruments, Booker, Blinkx and Endace. Not all
newsflow was positive. Encore Oil disappointed, with poor drilling results in
the North Sea reducing hopes of large fields at Cladhan and to an extent at
Catcher. Keller warned that the US commercial construction market remains very
competitive. Although it is winning plenty of business, margins are not yet
recovering due to the aggressive behaviour of local competitors.


16 June 2011

ENDS

Latest information is available by typing www.blackrock.co.uk/its on the
internet, "BLRKINDEX" on Reuters, "BLRK" on Bloomberg or "8800" on Topic 3 (ICV
terminal). Neither the contents of the Manager's website nor the contents of
any website accessible from hyperlinks on the Manager's website (or any other
website) is incorporated into, or forms part of, this announcement.