Interim Results

ABERFORTH GEARED CAPITAL & INCOME TRUST plc

INTERIM RESULTS

For the six months to 30 June 2004

FEATURES

Total Assets Total Return                                 +12.7%

Net Asset Value of Notional Unit Total Return             +20.2%

HGSC Index (Excluding Investment Companies) Total Return  +41.8%

First Interim Dividend                                     3.15p

First Interim Dividend                                     +2.4%

Notional Unit NAV comprises 70% of the Income Share NAV and
30% of the Capital Share NAV.

Aberforth Geared Capital & Income Trust plc invests only in
small UK quoted companies, does not invest in any unquoted
securities, AIM listed securities or securities issued by
investment trusts or investment companies.



CHAIRMAN'S STATEMENT TO SHAREHOLDERS

I  am  pleased to be able to report a period of strong returns for the  assets  of
Aberforth  Geared Capital & Income Trust plc (AGCiT).  The total return  on  total
assets  of 12.7% reflects strength in the Company's chosen asset class,  small  UK
quoted  companies.   As  measured  by the Hoare  Govett  Smaller  Companies  Index
(Excluding  Investment  Companies), the return from this asset  class  was  10.6%.
Larger  companies, as represented by the FTSE All-Share Index, registered a  total
return of 2.8%.

The  effect of the gearing employed by the Company is to translate the 12.7% total
return on total assets into a 20.2% return on Shareholders' funds.  After allowing
for a 100p capital entitlement of the Income Shares, the net asset value  of  a
Capital Share has risen by 41.8% from 164.32p on 31 December 2003 to 232.98p at 30
June 2004.

A  first  interim dividend for 2004 of 3.15p per Income Share has  been  declared.
This  dividend represents a 2.4% increase over the 3.075p paid in respect  of  the
comparative period in 2003.  The dividend will be paid on 26 August 2004 to Income
Shareholders on the register on 30 July 2004.

In  order  to allow more efficient use to be made of the Company's original  long-
term  debt  facilities, which amounted to £34.3m, additional overdraft  facilities
totalling  £4m  have  been negotiated.  The new facilities  are  in  the  form  of
overdrafts  and  do  not  incur  non-utilisation  charges.   Consequently,  it  is
anticipated  that AGCiT will now be in a position to utilise its £34.3m  of  long-
term  debt  facilities  on a fuller and more consistent basis  than  had  hitherto
proved possible.



INVESTMENT BACKGROUND

The  last  six  months  have seen confirmation of a worldwide  economic  recovery.
Fuelled  by  historically  low  interest rates, the  US  economy  has  driven  the
expansion: consensus expectations for GDP growth in 2004 are now one fifth  higher
than  they  were six months ago.  Crucially, though, the role of  the  US  in  the
global  upturn has been complemented by the nations of East Asia, and by China  in
particular.

Happily,  the emerging economies of the region have been joined by Japan,  for  so
long  a  laggard  in  terms of economic growth: Japanese GDP  grew  by  6%  at  an
annualised  rate  in  the first quarter of 2004 and has now  increased  for  eight
consecutive  quarters. Importantly, this expansion is not now due only  to  export
growth:  one  third  of  the  first quarter's progress was  generated  by  private
consumption.

Europe's  economic  performance, on the other hand,  remains  sluggish.   Although
recent  survey  data  do  suggest an improvement in prospects,  much  of  this  is
attributable to the growth in demand from the rest of the world: Europe has yet to
generate a self-sustaining recovery.

The  UK  stands in contrast to its continental peers.  Economic growth in 2004  is
robust,  supported by a combination of higher government spending, a  recovery  in
investment and the reliable household sector.  The resilience of the consumer  has
been  bolstered by falling unemployment and average earnings growth of almost  5%.
Less  securely, and in a circular fashion, the continuing strength of the  housing
market has also played a role.

In  aggregate,  therefore, the data pertaining to the real growth of  the  world's
economies have, on balance, been positive over AGCiT's first half.  This has  been
an  environment  conducive  to  a continuation of  profits  growth.   In  the  UK,
corporate  profits  as a percentage of GDP have returned to levels  of  mid  2000.
More  remarkably, albeit assisted by dollar weakness, US corporate  profits  as  a
percentage of GDP have surged to levels not seen since the late 1990s.

Given this, and the recent exceptional level of earnings upgrades from Wall Street
analysts,  it  is  perhaps surprising that stockmarkets have not performed  rather
better over ACCiT's first half: in local currency and capital only terms, the  S&P
500  Index is up by 2.6% and the FTSE All-Share Index by just 1.0%.  Clearly,  the
market discounted much of the recovery, but it has also been preoccupied by  other
factors.

The  geopolitical  climate  remains uncertain: events in  Iraq  and  Saudi  Arabia
increase  the perceived risks of holding equities.  More tangibly, Middle  Eastern
turmoil  has  combined with Chinese and American demand to drive up the  price  of
oil.   China's  influence can also be observed in the prices of other commodities,
such as steel.  Commodity prices have a direct, though potentially delayed, effect
on  corporate profitability.  With profit share close to peak levels, it  may  now
prove tougher for profits to increase more quickly than GDP.

Compounding these concerns are indications - in commodity prices, producer  prices
and  average  earnings - that the debate between inflation and  deflation  may  be
swinging  towards the former camp.  While such an outcome ought to prove the  more
benign  for  equities, the transition would not be painless.  Such  pain  is  most
obvious in higher interest rates.  In contrast to the UK, where the MPC has raised
rates  four times in eight months, the US has seen just one increase on  the  last
day  of  June.   However,  fears that the Fed may be underestimating  the  nascent
inflation  risk have been taken into account by the bond market, which,  from  mid
March, has endured its sharpest fall since 1994.

On  both  sides  of  the  Atlantic, therefore, investors are  confronting  tighter
monetary  conditions,  something they have not had to  do  for  four  years.   The
inevitable pressure on the valuation of equities - and indeed other asset  classes
-  risks  being  exacerbated by the unwinding of leveraged  investment  strategies
whose viability has relied on cheap money.

INVESTMENT PERFORMANCE

In  the  first  two months of 2004, small UK quoted companies, AGCiT's  investment
universe,  sustained the momentum of the previous year, though  their  performance
from  the  end  of  February was more subdued, possibly as the  impact  of  higher
interest  rates was felt.  Nevertheless, the first half as a whole  saw  the  HGSC
(XIC)  index  achieve good returns both in absolute terms and  relative  to  large
companies.  These returns were exceeded by AGCiT.

AGCiT's out-performance was broadly based, with the portfolio adding value against
the  HGSC  (XIC) index in 19 of the 31 sectors that make up the index.  In  common
with  previous  phases  of  good performance, the identification  of  attractively
valued   businesses  (i.e.  stock  selection)  proved  more  important  than   the
exploitation  of  broad industrial themes (i.e. sector selection).   However,  one
sector  worthy of note is Oil & Gas, to which AGCiT has relatively little exposure
owing to a lack of attractive companies with appropriate dividend yields.  In  the
six  months,  Oil & Gas accounted for over one quarter of the HGSC  (XIC)  index's
capital return.  The rising oil price was influential, but more important was  the
exceptional  performance  of  the  exploration  companies,  as  certain  discovery
successes whetted investors' appetite for high impact drilling programmes.

With  greater  confidence  in economic growth, corporate  activity  continued  the
upturn  that  began in the second half of 2003.  AGCiT has been a disproportionate
beneficiary:  nine  of  its  portfolio companies were  at  the  receiving  end  of
corporate  activity  in the first six months of the year.   Performance  was  also
enhanced   by  value  creation  initiatives  from  six  other  investments:   such
initiatives  include  share buy backs and disposals of non-core  businesses.   Not
unexpectedly,  equity  issuance has also picked  up:  in  its  first  half,  AGCiT
subscribed to three fund raisings, one of which was an initial public offering.

An  analysis of the portfolio as at 30 June 2004 suggests that the environment for
dividend growth remains healthy.  There were 95 companies in the portfolio at  the
end of June.  These companies paid 86 dividends that AGCiT was entitled to earn in
the  first half.  Of the 86, two were cuts, 25 were unchanged on the corresponding
payments in the previous year and 59 were increases.  The median dividend increase
of  the  86  companies was 6.9% year on year.  Although it should  be  noted  that
AGCiT's  actual  receipts vary from this figure since the  portfolio  is  actively
managed,  this  rate of increase is encouraging: it is in excess of  the  rate  of
inflation  and  gives  some  fundamental  justification  to  recent  share   price
movements.

INVESTMENT OUTLOOK

The  interplay of developments in the real economy and those in financial  markets
is,  in the short run at least, unpredictable.  It should not therefore come as  a
surprise  that  the  present investment outlook is radically different  from  that
which  prevailed  a year ago.  As highlighted in AGCiT's previous interim  report,
markets then were fretting about deflation, to which the monetary authorities  had
reacted  with  lower  interest  rates  and  vague  references  to  "unconventional
measures".   Twelve  months  on,  it  seems that  these  tactics  have  succeeded.
Economic  recovery appears well entrenched and, in combination with  earlier  cost
cutting,  has  generated  a strong recovery in corporate profits.   Moreover,  the
deflationary  threat seems to have receded, to the extent that investors'  greater
fear is now that monetary policy may have remained too loose for too long and that
inflationary pressures are mounting.

However,  with  public  and  private sector debt  levels  in  developed  economies
remaining  high,  it  would appear premature to write off the risk  of  deflation.
Fine  judgment  on the part of central banks is required to ensure  that  monetary
tightening  -  or the financial markets' anticipation of it - does  not  have  too
dramatic  an effect on demand.  At the very least, with interest rates rising,  it
would  seem  reasonable  to expect a period of more modest  economic  and  profits
growth.

In  such  an  environment, the stockmarket might struggle to produce real  returns
much above the historic average of 5-7% per annum.  However, within this long  run
average, shorter periods of exaggerated price movements - both up and down  -  are
probable,  especially in view of the activities of leveraged  market  participants
such as hedge funds.  Over the last year or so, the direction has been upwards and
small  companies have led the way: as the table below shows, their out-performance
has  taken them close to the valuation of the FTSE All-Share index, whose historic
PE and yield at the end of June were 16.1x and 3.2%.


                                    30 June              30 June
                                     2004                 2003
Characteristics                AGCiT   HGSC (XIC)      AGCiT   HGSC (XIC)

Number of Companies               95      707             82      827
Weighted Average Market        £331m    £414m          £318m    £334m
Capitalisation
Price Earnings Ratio           13.1x    16.0x          11.2x    13.4x
(Historic)
Net Dividend Yield              3.7%     2.6%           4.2%     3.0%
(Historic)
Dividend Cover (Historic)       2.0x     2.4x           2.1x     2.5x


The table also shows that your Managers are not slaves to an index.  A universe of
707  companies abounds in individual opportunities for the consistent  application
of  value investment disciplines.  AGCiT's portfolio is thus well diversified,  in
both  capital  and  income terms, and boasts a lower valuation  than  the  broader
equity  market,  as measured by both the HGSC (XIC) index and the  FTSE  All-Share
index.   In a still uncertain world, this valuation discount should, other  things
being equal, be of advantage to AGCiT.

Alastair C Dempster
Chairman
21 July 2004



The Statement of Total Return, summary Balance Sheet and
summary Cash Flow Statement are set out below: -

STATEMENT OF TOTAL RETURN
(Incorporating the Revenue Account)
(unaudited)
                                            6 months to              6 months to
                                            30 June 2004             30 June 2003
                                        Revenue Capital Total   Revenue Capital Total
                                        £'000  £'000  £'000  £'000  £'000  £'000

Realised gains/(losses) on sales        -       5,745   5,745   -       (1,188) (1,188)
Unrealised gains                        -       2,432   2,432   -       11,827  11,827

Net Gains on investments                -       8,177   8,177   -       10,639  10,639
Dividend income                         1,862   -       1,862   1,689   -       1,689
Interest income                         21      -       21      50      -       50
Other income                            9       -       9       -       -       -
Investment management fee               (104)   (242)   (346)   (74)    (173)   (247)
Other expenses                          (89)    -       (89)    (80)    -       (80)
                                        -----   -----   -----   -----   ------  ------
Net return before finance
costs and taxation                      1,699   7,935   9,634   1,585   10,466  12,051

Interest payable and similar charges    (311)   (726)   (1,037) (312)   (728)   (1,040)
                                        -----   -----   ------  -----   ------  ------
Return attributable to
non-equity shareholders                 1,388   7,209   8,597   1,273   9,738   11,011

Dividends and other appropriations in
respect of non-equity shares            (772)   (33)    (805)   (753)   (34)    (787)
                                        -----   -----   -----   -----   ------  ------
Transfer to reserves                    616     7,176   7,792   520     9,704   10,224
                                        =====   =====   =====   =====   ======  ======
Returns per non-equity interest2:
   Income Share                         5.67p   -       5.67p   5.20p   -       5.20p
   Capital Share                        -       68.66p  68.66p  -       92.74p  92.74p

Dividends per Income Share              3.150p  -       3.150p  3.075p  -       3.075p

NOTES
1.   The  revenue column of this statement is the  profit  and
loss account of the Company.  All revenue and capital items in
the  above  statement derive from continuing  operations.   No
operations were acquired or discontinued in the period.

2.    The calculations of revenue return per Income Share  are
based  on  net  revenue of £1,388,000  (30  June  2003  -  £1,
273,000)  million  and  on 24.5 million  Income  Shares.   The
calculations of capital return per Capital Share are based  on
net  capital  gains of £7,209,000 (30 June 2003 -  £9,738,000)
and on 10.5 million Capital Shares.


SUMMARY BALANCE SHEET
(unaudited)

                                        30 June         31 December     30 June
                                        2004            2003            2003
                                        £'000          £'000          £'000

Securities officially listed on
  the London Stock Exchange             84,996          74,199          67,641
                                        -------         -------         -------
Debtors                                 606             338             1,137
Cash at bank                            -               1               -
Overdraft                               (211)           -               -
Other creditors                         (1,235)         (1,550)         (1,360)
                                        -------         -------         -------
Net current liabilities                 (840)           (1,211)         (223)
                                        -------         -------         -------
Total assets less current liabilities   84,156          72,988          67,418

Creditors (amounts falling due after
  more than one year)                   (34,230)        (30,887)        (31,256)
                                        -------         -------         -------
Total assets less liabilities           49,926          42,101          36,162
                                        =======         =======         =======

Capital and reserves: non-equity interests
  Called up share capital               350             350             350

Reserves:
  Capital redemption reserve            50              50              50
  Special reserve                       33,929          33,929          33,929
  Capital reserve - realised            1,040           (3,737)         (4,325)
  Capital reserve - unrealised          13,594          11,162          5,378
  Revenue reserve                       963             347             780
                                        ______          ______          ______
                                        49,926          42,101          36,162
                                        ======          ======          ======

Net Asset Values:
  per Income Share                      65.06p          62.37p          61.43p
  per Capital Share                     317.81p         255.42p         201.06p



NOTE
During the period the Company had 24.5m Income Shares and 10.5m Capital Shares in issue.


SUMMARY CASH FLOW STATEMENT
(unaudited)

                                                6 months to     6 months to
                                                30 June 2004    30 June 2003
                                                £'000  £'000  £'000  £'000

Net cash inflow from operating activities               1,274           1,226

Returns on investments and servicing of finance
Interest and similar charges paid              (1,027)          (1,037)
Non-equity dividends paid                      (1,256)          (1,225)
                                               -------          -------
Net cash outflow from returns on investments
and servicing of finance                               (2,283)          (2,262)

Capital expenditure and  financial investment
Payments to acquire investments                (23,051)         (12,415)
Receipts from sales of investments             20,509           15,072
                                               -------          -------
Net cash (outflow)/inflow from capital
expenditure and financial investment                  (2,542)           2,657
                                                      -------           ------
Net cash (outflow)/inflow before financing            (3,551)           1,621

Financing
Loans drawn down/(repaid)                      3,339            (1,622)
                                               ------           -------
Net cash inflow/(outflow) from financing              3,339             (1,622)
                                                      ------            ------
Change in cash during the period                      (212)             (1)
                                                      ======            ======

NOTES
The  same  accounting  policies used  for  the  period  to  31
December  2003  have  been applied.  The financial  statements
have  been  prepared in accordance with applicable  accounting
standards  and  with  the  Statement of  Recommended  Practice
"Financial Statements of Investment Trust Companies" (SORP).
The  foregoing do not comprise statutory accounts (as  defined
in  section 240(5) of the Companies Act 1985) of the  Company.
The  statutory  accounts for the period to 31  December  2003,
which  contained an unqualified Report of the  Auditors,  have
been  lodged  with  the  Registrar of Companies  and  did  not
contain  a statement required under section 237(2) or  (3)  of
the Companies Act 1985.

The Interim Report is expected to be posted to shareholders on
23  July  2004.  Members of the public may obtain copies  from
Aberforth Partners, 14 Melville Street, Edinburgh EH3  7NS  or
from its website at www.aberforth.co.uk.

CONTACT: David Ross  Aberforth Partners 0131 220 0733

Aberforth Partners, Secretaries - 21 July 2004
ANNOUNCEMENT ENDS