Interim Management Statement

Montanaro UK Smaller Companies Investment Trust PLC

Interim Management Statement - 3 months to 30 June 2012

Investment Objective

MUSCIT's investment objective is capital appreciation through investing in
small quoted companies listed on the London Stock Exchange or traded on the
Alternative Investment Market ("AIM") and to achieve relative outperformance of
its benchmark, the FTSE SmallCap (excluding Investment Companies) Index
("SmallCap").

No unquoted investments are permitted.

Benchmark

FTSE SmallCap (excluding Investment Companies)

Net Asset Value Performance

                    3 months      1 year     3 years   5 years       Launch
                                                                           
MUSCIT                (2.2%)      (4.7%)       87.2%       15%       325.9%
(excluding                                                                 
current period                                                             
revenue)                                                                   
                                                                           
Benchmark             (5.3%)      (9.3%)       27.5%   (37.7%)        42.3%
                                                                           
Outperformance         3.1%        4.6%        59.7%    52.7%        283.6%

Performance Summary (capital only)

                        As at 30        As at 31       Movement
                                                               
                       June 2012      March 2012               
                                                               
Gross Assets        £160,132,387    £162,904,791         (1.7%)
                                                               
Net asset value           429.23p         436.57p        (1.7%)
per share                                                      
                                                               
Share price               338.50p         348.00p        (2.7%)
                                                               
Discount                    21.1%           20.3%               
                                                               
Actual Gearing              10.4%           10.3%               
                                                               
Net Gearing                  5.0%            0.7%               
 
Period Review

For the 3 months ended 30 June 2012:

The Company's net asset value per share decreased by 2.2% during the three
month period ended 30 June 2012.  This compares to a decrease of 5.3% in the
benchmark index.

During the period, the UK stock market gave up some of its gains from the first
quarter of 2012 as the economic outlook deteriorated and speculation continued
over the future of the Eurozone.  Cyclical companies with exposure to the Euro
Zone and China in particular suffered after a solid start to the year.

Despite a more challenging macroeconomic environment, our investee companies
have continued to show confidence in their ability to grow.  We are currently
maintaining our defensive bias in the portfolio with a low level of gearing but
with a view to gradually increasing gearing in anticipation of a strong end to
the calendar year.

Montanaro Asset Management Limited

30 July 2012

Top Ten Holdings as at 30 June 2012

Company                      Sector                                  % of total
                                                                      portfolio
                                                                               
Devro                        Food Producers                                 3.6
                                                                               
Domino's Pizza               Travel & Leisure                               3.4
                                                                               
Victrex                      Chemicals                                      3.4
                                                                               
Domino Printing Sciences     Electronic & Electrical                        3.3
                             Equipment                                         
                                                                               
Genus                        Pharmaceuticals & Biotechnology                3.3
                                                                               
Dialight                     Electronic & Electrical                        3.1
                             Equipment                                         
                                                                               
Fidessa                      Software & Computer Services                   3.1
                                                                               
Dignity                      General Financials                             3.1
                                                                               
Shaftesbury                  Real Estate                                    3.1
                                                                               
Dechra Pharmaceuticals       Pharmaceuticals & Biotechnology                2.9
                                                                               
                                                                           32.3

Sector Breakdown

Sector                                     % of total  % of market 
                                            portfolio                       
                                                                      
Aerospace & Defence                              2.5          1.7
                                                                      
Automobiles & Parts                              0.0          0.3
                                                                      
Beverages                                        2.8          0.0
                                                                      
Chemicals                                        8.6          1.4
                                                                      
Construction & Materials                         2.4          5.2
                                                                      
Electronic & Electrical Equipment               11.0          5.0
                                                                      
Food Producers                                   5.6          4.0
                                                                      
General Financials                               3.8          1.4
                                                                   
General Retailers                                3.1          4.8
                                                                      
Health Care Equipment & Services                 2.9          1.7
                                                                      
Household Goods & Home Construction              0.0          2.5
                                                                      
Industrial Engineering                           3.4          3.6
                                                                      
Industrial Transportation                        6.5          2.9
                                                                      
Leisure Goods                                    0.0          0.5
                                                                      
Life & Non-life Insurance                        0.0          2.8
                                                                      
Media                                            0.7          4.3
                                                                    
Mining                                           0.0          2.6
                                                                      
Oil & Gas Producers                              4.5          2.3
                                                                      
Other                                            0.0          2.1
                                                                      
Pharmaceuticals & Biotechnology                  6.2          1.3
                                                                      
Real Estate                                      5.9         16.2
                                                                      
Software & Computer Services                    11.8          4.8
                                                                      
Support Services                                14.9         16.3
                                                                      
Technology, Hardware & Equipment                 0.0          3.8
                                                                      
Travel & Leisure                                 3.4          8.5
                                                                      
                                               100.0        100.0
                                                                      

Other than as stated above, the Directors are not aware of any significant
events or transactions which have occurred between 30 June 2012 and the date of
publication of this statement which have had a material impact on the financial
position of the Company. For latest performance information, please refer to
the Company's website.

At the Company's Annual General Meeting held on 27 July 2012, all of the
resolutions put to shareholders were duly passed on a show of hands. This
included a change to the Company's Articles of Association to permit the
realised Capital Reserve to be classified as a distributable reserve.

This Interim Management Statement and up to date NAV and Share Price are
available at the Company's website www.montanarouksmaller.co.uk.

Neither the contents of the Company's website nor the contents of any website
accessible from hyperlinks on the Company's website (or any other website) is
incorporated into, or forms part of, this announcement.