Cost Reduction Measures

RNS Number:5599P
Coe Group PLC
09 September 2003

                             COE GROUP PLC ("COE")


COE Group plc, the AIM quoted provider of technology for managed video networks,
announces cost reduction measures.

Whilst trading conditions remain competitive, current trading of the run rate
business is in line with expectations.  However, trading in respect of major
contracts is being adversely affected by client-led delays occurring in a number
of large international projects and it is now anticipated that sales revenue in
this area will fail to meet plan for the current financial year.

In view of the lack of adequate visibility in a major part of its sales
projections, the Board has recognised that positive action is required to ensure
costs are kept in line with visible sales revenues and has decided to take early
action and implement a series of cost reduction measures.  Regretfully, these
measures include job losses.  Today, the Board will commence a process of
consultation with its employees regarding the need to reduce the current work
force by up to 35 people.  In addition, the Board is implementing a general cost
review to minimise other operating costs.

It is anticipated that the process will be completed by late October, and that
the costs incurred in taking these measures will be covered by the employment
cost savings in the current financial year.

In conjunction with the cost reduction process, the Board is looking to
implement a program aimed at shifting the significantly fixed cost base of the
Group towards a more variable cost structure that will be more flexible in
dealing with sales revenue fluctuations.

The Board is confident that the steps it is taking to reduce costs will ensure a
solid foundation for COE and enable it to take advantage of the major contracts
that remain in the pipeline.


Contacts:


Brian Wadsworth                                   0113 230 8800
Chief Executive Officer

Michael Sandpearl                                 0113 230 8800
Chief Financial Officer



                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

MSCBXGDCXUGGGXC