Preliminary Results - Part 1

Foresight Technology VCT PLC
21 December 2000


PART 1

Foresight Technology VCT plc
Preliminary Announcement of Results for the year ended 30 September 2000

CHAIRMAN'S STATEMENT

Introduction

It is a pleasure to present the third Annual Report and Financial Statements
of Foresight Technology VCT plc for the year ended 30 September 2000.
In May, Foresight became the first venture capital trust to pay a dividend to
Ordinary Shareholders equivalent to the starting capital of the Ordinary
Share funds: 100 pence per share. This was entirely attributable to the
partial realisation of just one of the Company's investments; e-district.net
plc, which raised £12.39 million (net of expenses) on a cost of £158,681. As
a result of this distribution the hurdle on the performance related carried
interest arrangements relating to the Ordinary Shares fund was also met.

Pursuant to the public offer of 'C' Shares launched on 14 October 1999 the
Company raised, before expenses, £32,566,496.

We have also had some losses within the Ordinary Shares fund. Aran Software
plc went into receivership in June 2000 and The e-Exchange Limited went into
administrative receivership in September 2000. This resulted in write offs of
£1.4 million and £1.03 million respectively. It is not expected that
Foresight will receive more than nominal proceeds from the eventual
liquidation of either company. Our fund advisers, VCF Partners, worked hard
to help the boards of both companies resolve their difficulties but it was
not possible to effect a turnaround in their fortunes. It is a feature of
investing in unquoted companies that there will be losses as well as profits.

As a consequence of the decision to distribute a capital dividend of 100
pence to Ordinary Shareholders in May 2000 the Company ceased to be an
investment company within the meaning of section 266 of the Companies Act
1985. This means that at the moment we are obliged as a matter of company law
to take account of capital losses when determining our ability to make a
distribution of revenue profits to Ordinary Shareholders and 'C'
Shareholders. The losses attributable to Aran Software plc and The e-Exchange
Limited, and the fact that, in accordance with the accounting policy of the
Company, a proportion of management expenses are charged to the capital
account of each fund, mean that the Company will not be in a position to pay
a dividend from revenue reserves at the end of January 2001.

However, the Company intends to apply, subject to the approval of
shareholders and warrantholders, to the Court to cancel a proportion of the
share premium account in both the Ordinary Shares fund and the 'C' Shares
fund. This will set free reserves in each fund against which losses can then
be written off. In due course this should allow a distribution to
shareholders following the publication of our results for the half year
ending 31 March 2001. I urge all shareholders and warrantholders to vote in
favour of the resolution to be proposed at this year's Annual General Meeting
to effect this reduction of share capital.

Results for the year

The results for the year from 1 October 1999 to 30 September 2000 are set out
in the following pages. The total return (after tax) attributable to the
Ordinary Shareholders before the payment of dividends during the year was
£28,335,728 (1999: £568,477) and the net asset value per Ordinary Share at 30
September 2000 was 210.71p (1999: 99.03p). With regard to the holders of 'C'
Shares the attributable loss was £89,857 and the net asset value per 'C'
Share at 30 September 2000 was 93.50p.

Dividend

In relation to the Ordinary Shares fund, the Company paid an interim dividend
in May 2000 of 100p net per share (1999: 1.00p per share) on the basis of the
results for the six months ended 31 March 2000. The after tax revenue return for
the year (before capital losses) per Ordinary Share was 1.07p and 2.73p per 'C'
Share for the period to 30 September 2000.

Investment position

Your managers have continued to find attractive qualifying investments to add
to the portfolio and following the successful performance of the Ordinary
Shares fund the Board has revised its investment policy. It now intends that
up to 100% of the Ordinary Shares fund should be invested in UK based venture
capital investments primarily in the technology sector.

As at 30 September 2000 £9.7 million had been approved for investment or
invested in eleven companies, £3 million of which had been realised or written
off. This represented approximately 90% of the Company's investments, the
balance being invested in fixed interest securities and cash deposits. As noted
earlier, Foresight realised part of its investment in e-district.net plc when
the company floated on the Alternative Investment Market ('AIM') in March 2000
at a price of 195p per share raising £12.39 million (net of expenses) on a cost
of £158,681. The Company's advisers, VCF Partners, are encouraged by the
progress being made by a number of the other companies in which the Ordinary
Shares fund holds investments. As at 30 September 2000, the capital reserves
show, on a capital base of £10.5 million, a capital gain of £16.8 million which
is net of provisions in respect of the investments in Survey and Development
Services Limited and CyberLife Technology Limited, the write offs attributable
to the The e-Exchange Limited and Aran Software plc and capitalised management
expenses (net of tax relief).

As regards the 'C' Shares fund and, in accordance with the Company's
prospectus published in October 1999, it is the intention to invest up to 80%
of the 'C' Shares fund in UK based venture capital investments primarily in
the technology sector. As at 30 September 2000 £4.5 million had been approved
for investment or invested in six companies.  This represented approximately 15%
of the Company's investments, the balance being invested in fixed interest
securities and cash deposits. Several further potential investments are also
being considered for investment. The Company's advisers, VCF Partners, are
encouraged by the progress being shown by a number of the companies in which the
'C' Shares fund holds investments. As at 30 September 2000, the capital reserves
currently show, on a capital base of £30.5 million, a capital loss of £0.8
million, which is net of provisions in respect of the investments in
Travelstore.com plc, and UK Directory (Holdings) Limited and capitalised
management expenses (net of tax relief).

The investments held by the Company have been valued in accordance with the
British Venture Capital Association guidelines under which unquoted
investments are not normally revalued above cost for at least 12 months after
the date of acquisition. The investments which are traded on AIM, OFEX or the
London Stock Exchange and the fixed interest securities are carried at market
value. The Board and the Advisers, in any event, always attempt to follow a
consistent and prudent valuation policy.

Recent investments

A further investment of £150,000 was completed in Sapphire International
Limited in early October 2000 from the Ordinary Shares fund.

In the 'C' Shares fund the Company invested £1 million in Mondas plc in
October 2000. Mondas' e-Business technologies allow securities and investment
houses to deploy new front and back office applications to facilitate
straight through processing. Customers benefit from improved content
management, document management, business process software and service
solutions.

Also, in October 2000, the Company invested £500,000 from the 'C' Shares fund
in Callserve Communications plc. Callserve is a PC-to-phone telecoms network
and service provider which enables telephone calls to be made from a PC via
the Internet to any other phone worldwide.

In November 2000, the Company invested £500,000 in iDesk plc from the 'C'
Shares fund. This company provides telcos, ISPs and other blue chip customers
with outsourced technical help desks, operated from a call centre in London.
iDesk has recently launched complementary new ASP services based on its
proprietary and licensed CRM and electronic billing software.

A further investment of £333,000 from the 'C' Shares fund was made in
Travelstore.com plc in November 2000 alongside several new investors in a
financing round that raised an additional £7 million for the company.

CREST

The Directors consider that shareholders should have the ability to make
their shares eligible to be held in uncertified form and settled in CREST, a
paperless settlement system, should they so wish. Crest is a voluntary system
and those shareholders who wish to retain their share certificates may do so.

Accordingly, the Board take this opportunity to give notice, in accordance
with the Uncertificated Securities Regulations 1995 ('the Regulations'), that
the Company intends to pass a resolution of its Directors that title to
shares in the capital of the Company, in issue or to be issued, may be
transferred by means of the CREST system. This resolution will enable the
Company's shares to be held in an electronic form in CREST making it
unnecessary for share certificates to be issued. In respect of ordinary
shares, the Directors' resolution will disapply those provisions of the
Company's Articles of Association that are inconsistent with the holding and
transfer of shares in an electronic form in CREST. Assuming the resolution is
passed and the permission of the operator of the system, CRESTCo Limited, has
been obtained, the Company's shares will enter CREST. It is anticipated that
this will be in February 2001.

I would like to take this opportunity to thank all shareholders and
warrantholders for their continued support and I look forward to welcoming
you at the Annual General Meeting on 30 January 2001.

Peter Dicks

Chairman

21 December 2000

THE VENTURE CAPITAL FUNDS

VCF Partners advise the Company in respect of investments made within the
Ordinary Shares fund and the 'C' Shares fund. During the year ended 30
September 2000, Foresight made 6 investments in the Ordinary Shares fund at a
cost of £3,205,396 and 6 investments in the 'C' Shares fund at a cost of
£4,509,051. The full investment portfolio of both funds as at 30 September
2000 is detailed below.

ORDINARY SHARES FUND

Sapphire International Limited

Owns the established 'DataEase' family of computer database software products
and has a worldwide base of several hundred thousand users. The company is
now introducing new technology that allows existing DataEase users to update
their applications for client/server operation and the internet.

Results from the latest audited accounts for the year ended 31 December 1999:
profit before tax £251,000 net assets £1,761,000.

                                                                              
  Date of     Amount        Valuation   %               Loan Stock  % of      
  investment  invested                  Equity/Voting               Ordinary  
              Including                 Rights                      Shares    
              Loan Stock                                            Portfolio 

  July 1998   £1,000,000*   Cost        17.6%           £400,000    3.72%     
                                                        10%                   

                                                        Unsecured             
                                                        Loan Stock            
     
* excluding £150,000 further equity investment completed in October 2000.

Actimax plc

Supplies digital telecommunications systems to small and medium sized
customers. The company installs complex computer and telephone combined
systems using components from suppliers such as Ascom, Lucent and Intertel.

Since Foresight's investment the company has progressively reduced its
trading losses but has not yet achieved sustained profitability.

Results from the latest audited accounts for the period ended 31 December
1999: loss before tax £235,411, net liabilities £412,509.

                                                                              
  Date of       Amount      Valuation   %               Loan Stock  % of      
  investment    invested                Equity/Voting               Ordinary  
                Including               Rights                      Shares    
                Loan Stock                                          Portfolio 

  November      £600,000*   Cost        42% (plus 6%    £120,000    2.23%     
  1998                                  warrants)       10%                   

                                                        Unsecured             
                                                        Loan Stock   
         
* including further equity investment of £100,000 in March 2000.

Survey and Development Services Limited 

Is a specialist geo-spatial data software products and services company. It
serves the growing market for digital mapping and the building of
geographical information system databases. The products include a software
system which creates digital maps and a system that uses satellite
positioning in conjunction with video for recording facilities for utilities.
The company converts existing maps into digital format.

The company is currently seeking further funding. The provision made at the
end of last year against the cost of the investment continues.

Results from the latest unaudited accounts for the year ended 30 June 2000:
loss before tax £79,773, net assets £837,152.

                                                                              
  Date of          Amount         Valuation   % Equity/Voting    % of         
  investment       invested                   Rights             Ordinary     
                                                                 Shares       
                                                                 Portfolio    

  December 1998    £500,000       £250,000    29.3%              0.93%        
     
CyberLife Technology Limited

Is a leading artificial intelligence software company. The range of products
under development covers entertainment software (such as the computer game
'Creatures') and productivity tools. The technology also relates to new
platforms such as toys, mobile phones and digital television. Foresight
invested a further £500,000 alongside another shareholder in a second round
of equity fund raising in September 2000.

The valuation of the investment has been adjusted to reflect the recent round
of fundraising

Results from the latest unaudited accounts for the year ended 31 August 1999:
loss before tax £1,239,537, net assets £3,178,459.

                                                                              
  Date of     Amount       Valuation  %               Loan Stock    % of      
  investment  invested                Equity/Voting                 Ordinary  
              Including               Rights                        Shares    
              Loan Stock                                            Portfolio 

  January     £1,500,000*  £746,375   11.1%           £500,000      2.78%     
  1999                                                Convertible             
     
* includes further investment of £500,000 loan stock in September 2000.

Advanced Composites Group Limited

Is a well established manufacturer of high technology carbon fibre composite
material, with factories in Heanor north of Derby, and Tulsa USA. Successful
markets include F1 racing cars, sports equipment, and aerospace applications.
Foresight supported the buyout team.

Results from the latest consolidated unaudited accounts of the subsidiary
undertakings for the year ended 31 August 2000: profit before tax £1,522,000,
net assets £5,171,000.

                                                                              
  Date of         Amount invested  Valuation    % Equity/Voting   % of        
  investment                                    Rights            Ordinary    
                                                                  Shares      
                                                                  Portfolio   

  March 1999      £1,622,978*      £2,372,978   27.5%             8.84%       
      
* includes further investments of £500,000 and £122,978 in October 1999 and
July 2000 respectively.

e-district.net plc (AIM listed)

Operates an internet portal site with an international community of over 2.2
million users which generated approximately 349 million page views in
November 2000. The site provides an increasing number of facilities including
online games, e-mail, personal home pages and chat, with e-commerce being
introduced. The company was floated on the AIM market in March 2000 at a
valuation of £149.7 million. Foresight sold 6,623,030 shares (approximately
one third of its initial investment amounting to £158,681) in the flotation
at a placing price of 195p per share to raise £12.39 million (net of
expenses).

Results from the latest unaudited interim accounts for the six month period
to 30 June 2000: loss before tax £46,676; net assets £15,263,420.

                                                                              
  Date of         Amount        Valuation     % Equity/Voting    % of         
  investment      invested                    Rights             Ordinary     
                                                                 Shares       
                                                                 Portfolio    

  March 1999      £341,319      £17,949,902   18.6%              66.87%   
    
Telecom plus plc (listed on the London Stock Exchange)

Offers low cost telephone services to private subscribers using relationship
marketing as a means of obtaining new customers. Services currently offered
include the provision of fixed wire and cellular phone services with the
company acting as a switchless reseller. This business is now growing rapidly
and Telecom plus are currently running gas and electricity trials that will
result in allowing its customers to buy all major utilities from one source.

Results from the latest unaudited accounts for the six months ended 30
September 2000: profit before tax £527,000; net assets £6,456,000.

                                                                              
  Date of     Amount     Valuation    %               Loan Stock    % of      
  investment  invested                Equity/Voting                 Ordinary  
              Including               Rights                        Shares    
              Loan                                                  Portfolio 
              Stock                                                           

  June 1999   £475,758   £2,456,250   1.5%            £250,000      9.15%     
                                                      Convertible    
         
Clarity Commerce Solutions plc (AIM listed)

Is part of a group of companies that provide EPOS solutions, CRM products and
services to the buoyant UK hospitality and leisure markets including the pub
market place and the restaurant and nightclub sector. The company
successfully completed a placing in July 2000 in which Foresight invested
£500,000.

Results from the latest unaudited accounts for the period from 24 January
2000 to 30 September 2000; loss before tax £502,000; net assets £5,007,000.

                                                                              
  Date of          Amount         Valuation   % Equity/Voting    % of         
  investment       invested                   Rights             Ordinary     
                                                                 Shares       
                                                                 Portfolio    

  July 2000        £500,000       £550,000    4.2%               2.05%    
    
THE 'C' SHARES FUND

Travelstore.com plc

Provides an online service for making business travel arrangements. It offers
a range of features for corporate and small business travellers including 24
hour telephone support. Foresight invested £333,000 in a further round of
funding in November 2000.

The valuation of the investment has been adjusted to reflect the recent round
of fundraising.

Results from the latest audited accounts for the period ended 31 March 2000:
loss before tax £13,283,227, net assets £10,999,142.

                                                                              
  Date of         Amount invested  Valuation   % Equity/Voting    % of 'C'    
  investment                                   Rights             Shares      
                                                                  Portfolio   

  December 1999   £1,000,000*      £513,506    3.3%               1.73% 
      
* excluding £339,000 further, investment completed in November 2000

KeepAhead Limited

Despatches lifestyle email services (e.g. current affairs, astrology, sport)
which 205,000 registered users receive free of charge. Revenue is generated
from advertising, and longer term from e-commerce.

No audited accounts produced since incorporation in May 1999.

                                                                              
  Date of         Amount          Valuation   % Equity/Voting    % of 'C'     
  investment      invested                    Rights             Shares       
                                                                 Portfolio    

  April 2000      £1,000,000      Cost        15%                3.37%  
      
UK Directory (Holdings) Limited (OFEX Listed)

Offers over 45,000 hand-vetted UK web site listings on an internet directory
with a search engine and in a magazine which circulates copies each month
through distributors such as W.H.Smith, John Menzies, and J Sainsburys.
Revenue is generated from advertising and magazine sales.

Results from the latest audited accounts for the period ended 31 August 2000:
loss before tax £347,000, net assets £2,375,671.

                                                                              
  Date of         Amount          Valuation   % Equity/Voting    % of 'C'     
  investment      invested                    Rights             Shares       
                                                                 Portfolio    

  April 2000      £1,000,000      £490,000    10%                1.65%   
     
themutual.net plc (AIM listed)

Operates expert sites which are created and run by members of themutual.net
who want to share their knowledge with other members. Each site features
articles, relevant links plus the opportunity to talk to the experts and
other members using the discussion forums and chat rooms. The company also
owns Freequotes which provides financial information to online investors.
Revenue is generated from advertising and members connectivity to the
themutual.net ISP. themutual.net's shares were listed on the AIM market in
June 2000 and all members receive Free Shares on registration. There were
over 130,000 registered users on 27 September 2000.

Results from the latest audited accounts for the period ended 30 April 2000;
loss before tax £716,338; net liabilities £61,505.

                                                                              
  Date of          Amount        Valuation    % Equity/Voting    % of 'C'     
  investment       invested                   Rights             Shares       
                                                                 Portfolio    

  June 2000        £502,938      £1,062,464   9.98%              3.58%        
     
FFastFill plc (Listed on AIM in November 2000)

Is a software company which develops sophisticated trading solutions for
futures and options traders, brokers and risk managers. Its system has three
key features; firstly, Windows NT trading screen with sophisticated
proprietary pricing calculation and strategy functions; secondly, N&K
management software allowing management to monitor, limit and even reverse
positions in real time; and thirdly, connectivity to exchanges. FFastFill was
listed on the AIM in November 2000.

Results from the latest audited accounts for the period from 1 April 2000 to
30 September 2000; loss before tax £1,225,540; net assets £2,112,604.

                                                                              
  Date of          Amount         Valuation   % Equity/Voting    % of 'C'     
  investment       invested                   Rights             Shares       
                                                                 Portfolio    

  July 2000        £506,113       £499,996    3.33%              1.69%        
     
Sarantel Limited

Seeks to become a market leader in the design and manufacture of a range of
mobility antenna products which include GPS antennas, BlueToothTM antennas
and 3rd Generation UMTS antennas. Sarantel has technology for mobile antennas
that reduces the amount of energy absorbed by body tissue.

No audited accounts produced since incorporation in September 2000.

                                                                              
  Date of          Amount         Valuation   % Equity/Voting    % of 'C'     
  investment       invested                   Rights             Shares       
                                                                 Portfolio    

  September 2000   £500,000       Cost        7.5%               1.69%   
     

INVESTMENTS MADE SINCE YEAR END - 'C' SHARES FUND

Mondas plc (AIM listed)

Has developed e-Business technologies to allow securities and investment
houses to deploy new front and back office applications to facilitate
straight through processing. Customers benefit from improved content
management, document management, business process software and services
solutions.

Results from the latest unaudited interim accounts for the six months ended
31 October 2000: loss before tax £23,877, net assets £4,480,095.

                                                                       
         Date of investment   Amount invested   % Equity/Voting Rights 
         October 2000         £1,000,000              7.7%   
                
Callserve Communications plc

Is a PC-to-phone telecoms network and service provider which enables
telephone calls to be made from a PC via the internet to any other phone
worldwide.

Results from the latest audited accounts for the period from 11 June 1999 to
31 March 2000: loss before tax £1,352,203, net assets £1,598,303.

                                                                       
         Date of investment   Amount invested   % Equity/Voting Rights 
         October 2000         £500,000          1.27%                  

iDesk plc

Provides telcos, ISPs and other blue chip customers with outsourced technical
help desks, operated from a call centre in London. iDesk has recently
launched complementary new ASP services based on its proprietary and licensed
CRM and electronic billing software.

Results from the latest audited accounts for the period from 1 August 1998 to
31 December 1999: loss before tax £1,398,464, net liabilities £989,723.

                                                                       
         Date of investment   Amount invested   % Equity/Voting Rights 
         November 2000        £500,000          1.59%                  

THE FIXED INTEREST FUNDS

The Ordinary Shares fixed interest portfolio and the 'C' Shares fixed
interest portfolio constitute the balance of the net proceeds from the issues
of Ordinary Shares and 'C' Shares, which are invested in fixed interest
securities and cash deposits by Cazenove Fund Management Limited.

STATEMENT OF TOTAL RETURN


                                                                              
                           Year ended 30 September 2000                       
                           Revenue              Capital         Total         
                           £                    £               £             
  Net gains and losses     -                    28,011,715      28,011,715    
  on investments                                                              
  Income                   1,632,302            -               1,632,302     
  Investment management    (248,723)            (746,169)       (994,892)     
  fees                                                                        
  Other expenses           (344,714)            -               (344,714)     
                           --------             --------        --------      
  Return on ordinary                                                          
  activities                                                                  
  before taxation          1,038,865            27,265,546      28,304,411    
  Tax on ordinary          (207,773)            149,233         (58,540)      
  activities                                                                  
                           --------             --------        --------      
  Return attributable to                                                      
  equity shareholders      831,092              27,414,779      28,245,871    
  Dividends in respect of                                                     
  equity shares            -                    (11,889,553)    (11,889,553)  
                           --------             --------        --------      
  Transfer to reserves     831,092              15,525,226      16,356,318    
                           --------             --------        --------      
  Return per share:                                                           
  Ordinary Shares          1.07p                236.17p         237.24p       
                           --------             --------        --------      
  'C' Shares               2.73p                (3.08)p         (0.35)p       
                           --------             --------        --------      
 
                                                                              
                               Year ended 30 September 1999                   
                                               Revenue     Capital       Total
                                                     £           £           £
  Net gains and losses on                            -     593,243     593,243
  investments                                                                 
  Income                                       437,381           -     437,381
  Investment management fees                  (64,627)   (193,881)   (258,508)
  Other expenses                             (174,030)           -   (174,030)
                                             --------    --------    -------- 
  Return on ordinary                                                          
  activities                                                                  
  before taxation                              198,724     399,362     598,086
  Tax on ordinary activities                  (69,355)      39,746    (29,609)
                                             --------    --------    -------- 
  Return attributable to                                                      
  equity shareholders                          129,369     439,108     568,477
  Dividends in respect of                                                     
  equity shares                              (110,295)           -   (110,295)
                                             --------    --------    -------- 
  Transfer to reserves                          19,074     439,108     458,182
                                              --------    --------    --------
  Return per share:                                                           
  Ordinary Shares                                1.17p       4.00p       5.17p
                                             --------    --------    -------- 
  'C' Shares                                         -           -           -
                                             --------    --------    -------- 
 
 
The Statement of Total Return incorporates the profit and loss account of the
Company.

All revenue and capital items in the Statement of Total Return derive from
continuing operations.

The Company has only one class of business and derives its income from
investments in shares, securities, loans and bank deposits.

Analysis Between Ordinary Shares and 'C' Shares funds 
 

                                                                              
                           Year ended 30 September 2000                       
                           Ordinary Shares Fund                               
                                       Revenue         Capital          Total 
                                             £               £              £ 
  Net gains and losses                       -      28,475,495     28,475,495 
  on investments                                                              
  Income                               369,189               -        369,189 
  Investment management              (111,730)       (335,191)      (446,921) 
  fees                                                                        
  Other expenses                      (96,976)               -       (96,976) 
                                      --------        --------       -------- 
  Return on ordinary                                                          
  activities                                                                  
  before taxation                      160,483      28,140,304     28,300,787 
  Tax on ordinary                      (32,097          67,038         34,941 
  activities                                                                  
                                      --------        --------       -------- 
  Return attributable to                                                      
  equity shareholders                  128,386      28,207,342     28,335,728 
  Dividends in respect of                                                     
  equity shares                              -    (11,889,553)    (11,889,553)
                                      --------        --------       -------- 
  Transfer to reserves                 128,386      16,317,789     16,446,175 
                                       --------        --------       --------
 
                                                                              
                               Period ended 30 September 2000 'C'             
                               Shares fund                                    
                                               Revenue     Capital       Total
                                                     £           £           £
  Net gains and losses on                            -   (463,780)   (463,780)
  investments                                                                 
  Income                                     1,263,113           -   1,263,113
  Investment management fees                 (136,993)   (410,978)   (547,971)
  Other expenses                             (247,738)           -   (247,738)
                                             --------    --------    -------- 
  Return on ordinary                                                          
  activities                                                                  
  before taxation                              878,382   (874,758)       3,624
  Tax on ordinary activities                 (175,676)      82,195    (93,481)
                                             --------    --------    -------- 
  Return attributable to                                                      
  equity shareholders                          702,706   (792,563)    (89,857)
  Dividends in respect of                                                     
  equity shares                                      -           -           -
                                             --------    --------    -------- 
  Transfer to reserves                         702,706   (792,563)    (89,857)
                                              --------    --------    --------
 
 
BALANCE SHEET
                                   

                                                                              
                                2000             £          1999             £
                                   £                           £              
  Fixed assets                                                                
  Investments                          49,299,291                   10,036,805
  Monies held pending                   7,187,245                      719,032
  investment                                                                  
                                       ----------                  ---------- 
                                       56,486,536                   10,755,837
  Current assets                                                              
  Debtors                 1,350,245                      315,873              
  Cash at bank              237,690                       31,937              
                         ----------                  ----------               
                          1,587,935                      347,810              
  Creditors: amounts      (182,322)                    (102,993)              
  falling due within                                                          
  one year                                                                    
                         ----------                  ----------               
  Net current assets                    1,405,613                      244,817
                                       ----------                  ---------- 
  Net assets                           57,892,149                   11,000,654
                                        ----------                  ----------
  Capital and                                                                 
  reserves                                                                    
  Called up share                         455,653                      111,085
  capital                                                                     
  Share premium                        40,532,782                   10,342,173
  account                                                                     
  Capital reserves                     16,051,833                      526,607
  (realised and                                                               
  unrealised)                                                                 
  Revenue reserves                        851,881                       20,789
                                       ----------                  ---------- 
  Equity                               57,892,149                   11,000,654
  shareholders' funds                                                         
                                        ----------                  ----------
  Net asset value per                                                         
  share of 1 pence                                                            
  each:-                                                                      
  Ordinary Shares                         210.71p                       99.03p
  'C' Shares                               93.50p     
                       -
Analysis Between the Ordinary Shares and the 'C' Shares funds 

                                                                              
                    30 September 2000             30 September 2000           
                    Ordinary Shares fund          'C' Shares fund             
  Fixed assets                  £             £               £             £ 
  Investments                         26,477,650                    22,821,641
  Monies held                            367,178                     6,820,067
  pending                                                                     
  investment                                                                  
                                     ----------                    ---------- 
                                      26,844,828                    29,641,708
  Current assets                                                              
  Debtors                  679,402                       670,843              
  Cash at bank              40,423                       197,267              
                       ----------                    ----------               
                           719,825                       868,110              
  Creditors:              (80,394)                     (101,928)              
  amounts falling                                                             
  due within one                                                              
  year                                                                        
                       ----------                    ----------               
  Net current                            639,431                       766,182
  assets                                                                      
                                     ----------                    ---------- 
  Net assets                         27,484,259                    30,407,890 
                                      ----------                    ----------
  Capital and                                                                 
  reserves                                                                    
  Called up share                        130,438                       325,215
  capital                                                                     
  Share premium                       10,360,250                    30,172,532
  account                                                                     
  Capital                             16,844,396                     (792,563)
  reserves                                                                    
  (realised and                                                               
  unrealised)                                                                 
  Revenue reserves                       149,175                       702,706
                                     ----------                    ---------- 
                                     27,484,259                    30,407,890 
  Equity                              ----------                    ----------
  shareholders'                                                               
  funds        
                                                               
CASHFLOW STATEMENT

                                                                              
                    Year ended                      Year ended                
                    30 September 2000               30 September 1999         
                                 £               £             £             £
  Operating                                                                   
  activities                                                                  
  Dividends                     -                          1,200              
  received                                                                    
  Deposit and           1,199,374                        264,909              
  similar                                                                     
  interest -                                                                  
  non-qualifying                                                              
  Investment          (1,245,699)                      (259,131)              
  management fees                                                             
  paid                                                                        
  Other cash            (628,198)                      (159,832)              
  payments                                                                    
                       ----------                    ----------               
  Net cash                              (674,523)                    (152,855)
  outflow from                                                                
  operating                                                                   
  activities                                                                  
  Servicing of                                                                
  finance                                                                     
  Net dividends                      (11,889,553)                    (427,720)
  paid                                                                        
  Taxation                                                                    
  ACT paid                                      -                     (79,357)
  Investing                                                                   
  activities                                                                  
  Purchase of        (25,368,955)                    (9,099,950)              
  fixed income                                                                
  investments                                                                 
  Purchase of         (7,714,447)                    (4,975,758)              
  other                                                                       
  investments                                                                 
  Sale of fixed         9,030,712                      6,010,146              
  income                                                                      
  investments                                                                 
  Sale of other        12,801,919                        360,000              
  investments                                                                 
                       ----------                    ----------               
  Net cash                           (11,250,771)                  (7,705,563)
  outflow from                                                                
  investing                                                                   
  activities                                                                  
                                       ----------                  ---------- 
  Net cash                                                                    
  outflow before                                                              
  financing and                                                               
  liquid resource                    (23,814,847)                  (8,365,495)
  management                                                                  
  Management of                                                               
  liquid                                                                      
  resources                                                                   
  Movement in                         (6,468,213)                    8,577,055
  money market                                                                
  and other                                                                   
  deposits                                                                    
  Financing                                                                   
  Issue of             30,551,312                        177,800              
  ordinary shares                                                             
  net of expenses                                                             
  Purchase of own        (62,499)                       (13,500)              
  shares                                                                      
                       ----------                    ----------               
                                       30,488,813                      164,300
                                       ----------                  ---------- 
  Increase in                             205,753                      375,860
  cash                                                                        
                                        ----------                  ----------
 
The Company holds gilts and bonds primarily as investments and not as liquid
resources. Accordingly, movements in the holdings of these investments are
shown within investing activities in the Cashflow Statement rather than
within management of liquid resources.

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