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3i UK Select Trust (UKT)

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Monday 04 September, 2000

3i UK Select Trust

Interim Results

3i UK Select Trust Ld
4 September 2000


The unaudited figures for the six months to 30 June 2000 have been drawn up
under The Statement of Recommended Practice for Investment Trusts and have been
prepared on the basis of the accounting policies set out in the company's annual
financial statements for the year ended 31 December 1999.

                   Statement of total return of the company

      The unaudited results below cover the six months ended 30 June 2000

                           Six months ended               Year ended      
                              30.06.00                     31.12.99       
                              unaudited                    audited        


                    Revenue    Capital    Total    Revenue    Capital    Total  
                     £'000      £'000    £'000      £'000      £'000    £'000

(Loss)/gain on 
investments               -     (5,481)  (5,481)         -     11,628   11,628 
Income                1,085          -    1,085      2,502          -    2,502
Investment managers'
 fee                    (51)      (154)    (205)      (110)      (331)    (441)
Other expenses         (120)         -     (120)      (206)         -     (206)
                      -----      -----    -----      -----     ------   ------
Net return before 
 finance costs          914     (5,635)   (4,721)    2,186     11,297   13,483

Interest payable        (66)      (196)     (262)     (133)      (395)    (528)
                      -----      -----     -----     -----     ------   ------
Return on ordinary 
 activities for the 
 financial period       848     (5,831)   (4,983)    2,053     10,902   12,955  

Interim dividend       (469)         -      (469)   (1,764)         -   (1,764)
Net savings due to 
 share elections          -        731       731         -        802      802  
                      -----      -----     -----     -----     ------   ------

                       (469)       731       262    (1,764)       802     (962)

Transfer to reserves    379     (5,100)   (4,721)      289     11,704   11,993

Return per ordinary 
 share                 1.49p    (10.21)p   (8.72)p    3.56p     18.90p   22.46p 
                      =====      =====     =====     =====     ======   ======



                                                         Six months ended       
                                                            30.06.00            
                                                           unaudited            
              


                                                   Revenue    Capital    Total  
                                                    £'000      £'000    £'000

(Loss)/gain on 
investments                                              -      7,901    7,901
Income                                               1,379          -    1,379
Investment managers'
 fee                                                   (54)      (161)    (215)
Other expenses                                        (101)         -     (101)
                                                     -----     ------   ------
Net return before 
 finance costs                                       1,224      7,740    8,964

Interest payable                                       (66)      (196)    (262)
                                                     -----     ------   ------
Return on ordinary 
 activities for the 
 financial period                                    1,158      7,544    8,702
Interim dividend                                      (479)         -     (479)
Net savings due to 
 share elections                                         -        565      565
                                                     -----     ------   ------
                                                      (479)       565       86
                       

Transfer to reserves                                   679      8,109    8,788

Return per ordinary 
 share                                                2.01p     13.08p   15.09p
                                                     =====     ======   ======


                              Unaudited balance sheet
                                  At 30 June 2000

                                          30.0.00      31.12.99       30.06.99
                                        unaudited       audited      unaudited
                                            £'000         £'000          £'000

Investments at market value                83,797        86,036         83,049
Net current assets                          2,047         5,799          5,982
Creditors: amounts falling due after
 more than one year                        (7,200)       (7,200)        (7,200)
                                           ------        ------         ------
                                           78,644        84,635         81,831

Called up share capital                     5,714         5,763          5,775
Capital reserves                           69,884        76,205         72,998
Revenue reserve                             3,046         2,667          3,058
                                           ------        ------         ------
                                           78,644        84,635         81,831

Net assets per 10p ordinary share           137.6p        146.9p         141.7p

Shares will go ex-dividend on 11 September 2000 and the record date will be 
15 September 2000.

The dividend will be payable on 27 November 2000.

The Chairman reports over the six months to 30 June 2000 the net asset value
total return to shareholders, which combines capital return and dividend income,
was -5.9%. This compares with the total return of the FTSE All Share index over
the period, the performance benchmark set by the Board was -5.5%.  No special
dividends have been received so far this year and partly as a consequence net
revenue per share fell by 24% to 1.5p; the Board are declaring  an unchanged
interim dividend of 0.83p.

The first half of the year has seen continued strong economic growth around the
world but the attention of equity markets has been focused on the interest rate
increases that have been the consequence. With some stability evident in markets
in recent months a controlled slowing in the rate of growth of western economies
could result in markets moving ahead again before the end of the year.

The Managers reported the UK equity market fell 6.6% over the period.  This
reflected  the evaporation of some of the overexuberance evident at the end of
1999, the recognition that growth would probably peak at some point in the year
and the likelihood of further interest rate increases in the US. In the UK large
companies fell most, down 8.9%, whilst smaller companies rose 8.3%.

Strong performances among portfolio companies came in many areas. Corporate
activity pushed up two television stocks, Carlton Communications up 41% and
United News up 20%. Companies with secured earnings enjoyed a  re-rating and
consumer companies such as Scottish and Newcastle (up 25%) and utilities like
Scottish and Southern Energy (up 22%) rose. There were also good performances
from some oil stocks and from pharmaceuticals. The best performance was in
Bookham Technology, a manufacturer of integrated optical components for
fibre-optic, networks. Bookham floated during the period and more than tripled
in price. The company received a favourable allocation in this stock due to its
relationship with 3i Group, one of the pre-flotation shareholders.  
Disappointments were focused on technology and telecommunications where stocks 
such as Filtronic (down 61%) and British Telecom (down 44%) fell sharply.
Financials were also weak.

The number of companies paying special dividends has fallen and many now prefer
share buy-backs or other forms of capital restructuring. These practices  boost
shareholder value but many of the more recently developed techniques result in
payments that cannot be recognised as income in the company's revenue account.
Partly as a consequence the net earnings from the portfolio have fallen in the
half year.

Looking forward stock markets are moving sideways in relatively narrow trading
ranges whilst exhibiting considerable volatility at the stock and sector level.
At some point this will change and past experience would suggest that upward
progress will resume when it becomes apparent that the western economies are
slowing in a controlled manner. It is not clear that any single theme will
dominate to the extent that technology has over the last twelve months. Instead
the Managers expect the current emphasis on quality in all areas of the market
to continue.