Interim Results

3i Smaller Quoted Co's Trust PLC
13 October 2000

                                                                              

                3i SMALLER QUOTED COMPANIES TRUST plc
                 ANNOUNCEMENT OF INTERIM RESULTS 2000
                             CONTINUED OUTPERFORMANCE
                                        
                                        
3i Smaller Quoted Companies Trust plc today announces
preliminary results for the 6 months ended
31 August 2000.

Highlights

    -NAV per share increased by 8.1% to 363.5p,
     exceeding the benchmark FTSE SmallCap Index
     excluding Investment Companies by 1.6% over the
     period and the Hoare Govett Smaller Companies Index
     excluding Investment Trusts by 7.6%
    -Outperformance of the benchmark, as well as the
     FTSE All-Share Index and the FTSE 100 Index over
     the last 6 months and 1, 3, 5 and 10 years
    -Excellent performances from new issues purchased
     from 3i.  47% of the portfolio is invested in
     companies backed by 3i
    -Underlying earnings per share of 3.30p (before
     receipt of special dividends of 0.05p per share) up
     from underlying earnings of 2.99p for the
     comparable period last year
    -Interim dividend increased 2% to 1.71p per share

Commenting on the results, Bill Govett, Chairman, said:
'The Trust has outperformed its benchmark again over the
last 6 months and can point to outperformance over 6
months and 1, 3, 5 and 10 years against all the main UK
indices.

The UK equity market as a whole has traded in a narrow
range in recent months despite considerable volatility
in technology stocks.  These conditions lend themselves
to a stock picking approach and small company funds are
well placed to outperform given the large universe of
stocks from which they can select their investments.
  The Trust has benefited in this respect from its
relationship with 3i and I expect this to continue.'

For further information, please contact:

Henrietta Marsh, 3i Asset Management Limited
020 7 975 3531

Issued by:
Christine Graeff, Burson-Marsteller
020 7 300 6248

Burson-Marsteller
24 - 28 Bloomsbury Way
LONDON
WC1A 2PX
020 7831 6262
www.bm.com


Chairman's Statement

Performance
The performance of UK smaller companies during the six
months to 31 August 2000 has built on the very strong
returns seen in the year to 29 February 2000. The
benchmark FTSE SmallCap Index excluding Investment
Companies increased by 6.5% whilst the net asset value
of the Trust outperformed with an increase of 8.1% to
363.5p. The Trust's share price reflected these gains
rising from 280p on 29 February 2000 to 301p on 31
August 2000. These results have extended the good long
term record of the Trust which has outperformed  the
FTSE All-Share and the FTSE 100 Indices, as well as the
benchmark index, over the last one, three, five and ten
years.

Earnings and dividends
Earnings per share for the six months to 31 August 2000
were 3.35p which includes 0.05p from special dividend
receipts. In the equivalent period last year earnings
per share were 3.50p including 0.51p from special
dividend receipts. The interim dividend has been
increased by 2% to 1.71p.

Discount and share buy-backs
The Board pays close attention to the discount to net
assets at which the Trust's shares trade. During the
six months to 31 August 2000 the discount was in the
range of 10% to 28%. During May, at a time when the
Trust's shares were trading at a discount of 26%
compared with the then sector average figure of 21%,
 the Board used its powers to buy back 200,000 shares.
 The discount subsequently narrowed to 17% by the end of
August 2000.

Gearing
Gearing levels are set by the Board, in consultation
with the Manager, with a view to increasing the long
term returns to shareholders. Gearing at the end of
August 2000 was 6.8%, a slight reduction on the 7.3% in
place at the end of February 2000. In my last report, I
mentioned that the Board was in the process of
examining options to increase potential gearing. At the
time, the preferred route for doing this was through a
long term debenture. However, as a result of heavy
issuance and expected issuance of debt by telecoms
companies the interest rate that would have been
payable by the Trust rose and the Board concluded that
the interest rate achievable was unattractive. The
Board has instead recently put in place a five year
£15 million revolving credit facility.

Market conditions
The UK equity market as a whole has traded in a narrow
range over the last few months, despite good growth in
the economy and stable interest rates. More recent news
has been less positive, with the 3i Enterprise
Barometer indicating a weakening of business confidence
and the effects of a high oil price as yet uncertain.
Whether the market can resume an upward trend may well
depend on conditions in overseas markets, particularly
the United States, where key issues include its
presidential election and the ability of the Federal
Reserve to slow the economy in a controlled manner.
Another factor which may improve business confidence
in the UK is any reversal of the weakness of the Euro.

Technology stocks are an influential component of the
market and have been volatile, falling severely in
March and April of this year but recouping some of
their losses from May onwards. Overall the techMARK 100
Index has lost around a quarter of its value since the
end of February 2000. However, there has been a wide
dispersion of returns and a number of stocks have
performed excellently. Looking forward it seems likely
that this sector will continue to offer the potential
for good stock selection to make a positive impact on
performance.



After a very strong year to the end of February 2000,
smaller companies performed broadly in line with larger
ones in the six month period to the end of August 2000.
They remain attractively rated compared to larger ones
and I am confident that over the medium term attractive
returns can continue to be achieved.


W J R Govett
12 October 2000



Investment Manager's Review

Strategy
The Manager aims to select and manage a diversified
portfolio of shares which will, in the medium term,
outperform the FTSE SmallCap Index excluding Investment
Companies (the 'benchmark index'). The Trust is
distinguished from others in the smaller companies
sector by its use of 3i Group's personnel and
information base. The latter includes extensive
non-confidential historical information concerning
companies prior to their flotation which helps in the
appraisal of recently floated companies. In certain
circumstances the Manager has the ability to buy shares
directly from 3i Group in companies which are being
floated. This can provide the Trust with an allocation
of stock which might otherwise be in short supply.

This strategy tends to lead to the Trust being
overweight in those sectors in which 3i Group has
particular knowledge or experience and for the Trust to
follow a growth orientated style although investment in
value or cyclical stocks is not precluded. The risk in
the portfolio is managed through owning a broadly
diversified portfolio, with a maximum of 5% of net
assets being held in any one stock, and sector
exposures carefully compared to those of the Trust's
benchmark index.

Overall performance
The net asset value of the Trust increased by 8.1% in
the six months to 31 August 2000, outperforming the
benchmark index which increased by 6.5% over the same
period. The outperformance of 1.6% was achieved despite
two factors which were not helpful. Firstly, in March
2000 the benchmark index was re-balanced with a
significant number of companies in the
Information Technology sector being promoted into the
FTSE 250 Index and a number of companies in the
Building and Construction sector being demoted from the
FTSE 250 to the benchmark index. This re-balancing
coincided with a change in market sentiment away from
technology companies and ABN AMRO estimated that it
added 8.2% to the performance of the benchmark index
during the first half of the calendar year. Secondly,
the Trust maintained an overweight position in the
Information Technology sector throughout the six month
period to 31 August 2000 and this sector of the
benchmark index lost an average of 35% of its value
over the period.

These two factors were more than compensated for by
other positive influences, two in particular. Firstly,
 the market for new issues was strong and the Trust
benefited from eight purchases direct from 3i. These
performed very strongly, and overall lifted the asset
value of the Trust by 4.0% from that at the beginning
of the six month period. Secondly, the Trust's
information technology stocks (excluding those acquired
from 3i during the period) performed significantly
better, on average, than those in the smaller companies
market as a whole thus limiting the losses incurred in
this sector.

Gearing
Gearing was maintained in the 6% to 10% range during
the period and had a slight positive impact on
performance. With the recent addition of the
£15 million revolving credit facility, the Trust now has
potential total borrowings of £35 million of which
£5 million is in the form of an overdraft facility.

New issues
The new issues market ran into trouble early in the six
month period with a number of high profile initial
public offerings being cancelled as demand evaporated
and prices of technology stocks fell. By June, however,
 the market had improved. Overall, the Trust invested
£10.1 million in 12 new issues, of which £8.1 million
comprised purchases direct from 3i. These purchases
from 3i included Profile Therapeutics, Beeson Gregory,
 Bookham Technology, NetStore, Weston Medical, TeleCity,
 Indigo Vision and TeleWork. These new issues performed
excellently producing an average uplift of 105%.

Takeovers
Takeover activity in the portfolio was high with nine
companies taken over in the six month period. Two of
these (BTP and Critchley) were already in progress at
the end of February 2000 and the others were J Holt,
City Technology, British Borneo, Border TV, MG,
Columbus Group and Slug & Lettuce.

Stocks and sector performance
Apart from the effect of new issues and bids, the
results of the Trust in the six months to 31 August
2000 were dominated by some extreme performances from
technology companies. Autonomy, which licenses its
knowledge management software, made a series of
announcements of new sales and saw an uplift of 48% in
its shares. The price of IQE, which is in the
electronics sector and produces epitaxial wafers used
in a wide variety of optical applications, rose 65% as
the market became increasingly convinced of the rapid
growth to be seen in the use of optics in
telecommunications. Guardian iT, which offers disaster
recovery services, made a number of acquisitions which
enhanced its market position in the UK and Europe and
its price rose 67%. Abacus Polar, which is a
distributor of electronic components, produced good
results in May with the semiconductor cycle moving to a
shortage of supply and the shares rose 36% over the six
month period.

There were also some good contributions from the
pharmaceutical sector with Shire Pharmaceuticals seeing
an uplift of 27% as it continued to gain market share
with its largest product Adderall, a drug which
addresses Attention Deficit Hyperactivity Disorder.

The poorest performances in the portfolio also came
from technology companies. They included DIAGONAL,
 whose activities include implementation of SAP systems,
 and Skillsgroup, which is a reseller of computers as
well as an information technology training company.
 Both announced poor interim results as a result of low
demand following the start of the new millennium. IMS,
 a business which provides call centre services and
increasingly is becoming a telecoms reseller, de-merged
its Teamtalk business which creates sports content for
the internet. This latter business was sharply de-rated
as business to consumer internet stocks fell from
fashion. royalblue was de-rated at a time when there
was concern about demand from financial institutions
for IT services following the millennium although its
interim results were in line with market expectations.

Looking at performance by sector, the Trust performed
slightly better than the relevant sector of the
benchmark index in Resources, Basic Industries,
 Non-Cyclical Consumer Goods and Cyclical Services and
worse than the relevant benchmark sector in General
Industrials and Cyclical Consumer Goods. In the
Non-Cyclical Services sector, the Trust was overweight
in Telecommunications Services which performed poorly.
 However, this is a small sector and the overall impact
 on the Trust was limited.

Sector weightings at the end of August 2000 were
broadly in line with those at the end of February 2000.
 The Information Technology sector saw some of the most
significant sales including NSB Retail and DIAGONAL.
 Large sales in other sectors included Glotel, a
telecoms recruitment agency. Purchases in the
Information Technology sector were principally of new
issues. Other purchases included Minorplanet, a
provider of information technology services to the
logistics industry, which is in the Transport sub-
sector, and Shanks Group which is a provider of waste
processing services.

Market capitalisation breakdown
The normal universe in which the Trust invests
comprises those stocks in the bottom 10% of the market
capitalisation of the London Stock Exchange. In
addition, investments may be made in UK based companies
listed on AIM, EASDAQ or NASDAQ and by exception on
OFEX and other OTC markets. At 30 September 2000, the
smallest constituent of the FTSE SmallCap Index
excluding Investment Companies had a market
capitalisation of £13 million, and the largest a
capitalisation of £655 million. At that date, 80.5% of
the Trust's portfolio by value was comprised of stocks
within this market capitalisation range, 19.1% was
above the range and 0.4% below it. The Manager will
continue to make new investments above this range from
time to time where a stock is regarded as attractive
and the market capitalisation does not exceed £740
million. It would be rare for the Manager to make a new
investment in a company with a market capitalisation of
less than £30 million.

Conclusion and outlook
Since the period end, the market has seen continued
volatility in technology stocks. The Trust remains
overweight in the Information Technology sector and has
an emphasis, in general, on growth stocks including
those with a technology aspect.

The new issue market tends to thrive when smaller
company shares are rising in price and provided these
conditions prevail, a good flow of new issues is
anticipated, some of which will be purchased directly
from 3i ensuring a favourable allocation of stock.

Smaller companies continue to offer good relative value
on 30 September 2000 the FTSE 100 Index traded at an
average price earnings ratio and yield of 26.2 and 2.1%
respectively compared to 18.0 and 2.8% respectively for
the FTSE SmallCap Index excluding Investment Companies.


3i Asset Management Limited
12 October 2000


Statement of total return for the six months ended 31 August 2000
(incorporating the revenue account)

                  6 months to                  6 months to
                  31 August 2000               31 August 1999
                   (unaudited)          (unaudited) (as restated)*
             Revenue      Capital   Total     Revenue Capital  Total
             £'000        £'000     £'000     £'000   £'000    £'000
Gains on                                                       
investments                                                    
Net realised                                                   
(losses)/                                                      
gains                                                          
over                                                           
previous                                                       
valuation                 (3,319)   (3,319)            1,596    1,596
Net                                                            
unrealised                                                     
appreciation              18,997    18,997            28,470   28,470
             -----------  --------  --------  ------- ------   -----
                                                      
                          15,678    15,678            30,066   30,066
Income       2,479                   2,479    2,658             2,658
Investment                                                     
management                                                     
fee           (232)         (697)     (929)    (123)    (368)    (491)
Other                                                          
expenses      (149)                   (149)    (153)             (153)
             -----------  --------  --------  ------- -------  ------
Net return                                                     
before                                                         
finance                                                        
costs        2,098        14,981    17,079    2,382   29,698   32,080
Interest                                                       
payable and                                                    
similar                                                        
charges       (163)         (489)     (652)    (355)    (241)    (596)
             -----------  -------   --------  ------  -------  ------
Return on                                                      
ordinary                                                       
activities                                                     
for the                                                        
period       1,935        14,492    16,427    2,027   29,457   31,484
Dividends     (982)                   (982)    (973)             (973)
Transfer to  -----------  -------   --------  ------  -------  ------
reserves       953        14,492    15,445    1,054   29,457   30,511
             ===========  =======   ========  ======  =======  ======
Return per                                                     
ordinary                                                       
share          3.35p      25.07p    28.42p    3.50p   50.86p   54.36p
             ===========  =======   ========  ======  =======  ======

*As restated for the change in accounting policy (see note 3 to the
financial statements)

Statement of total return for the six months ended 31 August 2000
(incorporating the revenue account) - cont'd.

                               12 months to
                             29 February 2000
                              (audited)
                Revenue    Capital     Total
                £'000      £'000       £'000
Gains on                               
investments                            
Net realised                           
(losses)/gains                         
over previous                          
valuation                  12,631      12,631
Net unrealised                         
appreciation               67,490      67,490
                           -------     -------
                           80,121      80,121
Income          4,107                   4,107
Investment                             
management fee   (378)     (1,135)     (1,513)
Other expenses   (253)                   (253)
                -------    -------     -------
                                       
Net return                             
before finance                         
costs           3,476      78,986      82,462
Interest                               
payable and                            
similar charges                        
                 (599)       (578)     (1,177)
                -------    -------     -------
Return on                              
ordinary                               
activities for                         
the period       2,877     78,408      81,285
Dividends       (2,433)                (2,433)
                -------    -------     -------
Transfer to                            
reserves           444     78,408      78,852
                ======     ======      ======
Return per                             
ordinary share  4.97p      135.37p     140.34p
                ======     ======      ======

All revenue and capital items in the above statement derive from
continuing operations.


                        6 months    6 months  12 months to
                        to 31       to 31     29 February
                        August      August    2000
                        2000 (un    1999 (un  (audited)
                        audited)    audited)
                        £'000       £'000     £'000
Reconciliation of total                       
shareholders' funds
Return on ordinary                            
activities for the                            
period                  16,427      31,484    81,285
Dividends                 (982)       (973)   (2,433)
                        -------     -------   --------
                        15,445      30,511    78,852
Purchase and                                  
cancellation of own
ordinary shares
Premium to nominal                            
value on shares                               
purchased                 (403)     -         -
Nominal value of shares                       
purchased                  (50)     -         -
                        -------     -------   --------
Movement in total                             
shareholders' funds      14,992      30,511    78,852
Opening total                                 
shareholders' funds     194,797     115,945   115,945
                                              
Closing total           -------     -------   --------
shareholders' funds     209,789     146,456   194,797
                        =======     =======   ========

Balance sheet as at 31 August 2000

                        31 August    31 August   29 February
                        2000         1999        2000
                        (unaudited)  (unaudited) (audited)
                        £'000        £'000       £'000
Fixed assets                                     
Investments             225,256      158,179     210,558
Current assets                                   
Debtors                   1,093        1,029       1,716
Cash and short term                              
deposits                    566        3,906         576
                        ----------   ----------  ------------
                          1,659        4,935       2,292
Creditors: amounts                               
falling due within one                           
year                     (2,445)      (1,992)     (3,379)
                        ----------   ----------  ------------
Net current                                      
(liabilities)/assets       (786)       2,943      (1,087)
                        ----------   ----------  ------------
Total assets less                                
current liabilities     224,470      161,122     209,471
Creditors: amounts                               
falling due after more                           
than one year           (14,681)     (14,666)    (14,674)
                        ----------   ----------- ----------
Net assets              209,789      146,456     194,797
                        ----------   ----------- ----------
Capital and reserves                             
Called up share capital 14,430       14,480      14,480
Share premium           38,952       38,952      38,952
Capital redemption                               
reserve                     50       -           -
Capital reserve                                  
-realised               60,347       37,450      48,742
-unrealised             92,793       52,700      90,359
Revenue reserve          3,217        2,874       2,264
                        ----------   ----------- -----------
Total shareholders'                              
funds                  209,789      146,456     194,797
                        ----------   ----------- -----------
Net asset value per                              
share                   363.5p       252.9p      336.3p
                        -----------  ----------- -----------

Approved by the Board 12 October 2000
Cash flow statement for the six months ended 31 August 2000

                        31 August     31 August    29
                        2000          1999         February
                                                   2000
                        (unaudited)   (unaudited)  (audited)
                        £'000         £'000        £'000
Operating activities                               
Investment income                                  
received                2,124         2,186        3,775
Deposit interest                                   
received                   29           223          313
Underwriting commission                            
received                    -            18           30
Investment management                              
fees paid               (1,022)        (451)        (942)
Secretarial fees paid      (29)         (29)         (59)
Other cash receipts          -            8            8
Other cash payments       (167)        (172)        (201)
                        -----------   -----------  ---------
Net cash inflow from                               
operating activities       935        1,783         2,924
                        -----------   -----------  ---------
Servicing of finance                               
Interest paid              (620)       (581)       (1,162)
                        -----------   -----------  ---------
Net cash outflow from                              
servicing of finance       (620)       (581)       (1,162)
                        -----------   -----------  ---------
Financial investment                               
Purchase of investments (25,385)      (15,957)     (42,324)
Sale of investments      26,968        11,141       34,591
Net cash                -----------   -----------  ---------
inflow/(outflow) from                              
financial investment      1,583        (4,816)      (7,733)
                        ------------  -----------  ---------
Equity dividends paid    (1,455)       (1,743)      (2,716)
Financing               ------------  ------------ ---------
Purchase of ordinary                               
shares for cancellation    (453)            -            -
                        -----------   ------------ ---------
Net cash outflow from                              
financing                  (453)            -            -
                        -----------   ------------ ---------
Decrease in cash            (10)       (5,357)     (8,687)
                        ===========   ============ =========

Notes to the financial statements

1.   Reconciliation of net revenue before finance costs to net
     cash inflow from operating activities

                        31 August  31 August  29 February
                        2000       1999       2000
                        £'000      £'000      £'000
Net revenue before                            
finance costs           2,098      2,382       3,476
Scrip dividends           (30)       (35)        (40)
Investment management                         
fee charged to capital   (697)      (368)     (1,135)
(Increase)/decrease in                        
accrued income           (296)      (195)         50
(Decrease)/increase in                        
creditors                (140)        17         581
Increase in debtors         -        (18)         (8)
                        ---------  ---------  ----------
Net cash inflow from                          
operating activities      935      1,783       2,924
                        --------   ---------  ----------

2.   Reconciliation of net cash flow to movement in net debt

                        31        31 August   29 February
                        August    1999        2000
                        2000      £'000       £'000
                        £'000
Decrease in cash in the                       
period                     (10)    (5,357)    (8,687)
Amortised debenture                           
stock issue expenses        (7)        (7)       (15)
                        --------  ---------   ---------
Movement in net debt in                       
the period                  (17)   (5,364)     (8,702)
Opening net debt        (14,098)   (5,396)     (5,396)
                        -------   ----------  ---------
Closing net debt        (14,115)  (10,760)    (14,098)
                        -------   ----------  ---------

3.    In accordance with Financial Reporting Standard 16 -
Current Tax, dividends receivable have been recognised at
an amount that excludes attributable tax credits.  This
policy was adopted for the first time in the accounts at 29
February 2000.  Previously dividends receivable included
attributable tax credits.  The revenue column of the statement
of total return for the six months to 31 August 1999 has
been restated to reflect this change in policy.  This
restatement has no effect on revenue reserve.

Notes to the announcement

1.    The Interim Report for the six months to 31 August 2000 will
be posted to shareholders on 17 October 2000 and thereafter
copies will be available from 3i Asset Management Limited,
91 Waterloo Road, London SE1 8XP

2.   The Interim dividend will be paid on 10 November 2000 to holders
of shares on the register of members on 27 October 2000.

3.   The accounting policies used in the preparation of the Interim
Report are the same as those sed in the statutory accounts
for the year ended 29 February 2000.  The six month period is
treated as a discrete period.  The figures for the year to 29
February 2000 are extracted from the accounts filed with the
Registrar of Companies on which the auditors issued an unqualified
report.  The Interim Report does not constitute statutory accounts.