Final Results

RNS Number:3333M
Carclo plc
16 June 2003



                                    Carclo plc
              Preliminary results for the year ended 31 March 2003


Key points

* Sales from continuing operations up 3.2% to #125.7 million (2002 -
  #121.8 million).

* The group returned to profitability, generating a profit before tax of
  #1.2 million (2002 - loss of #18.5 million).

* The board has recommended a dividend of 1.2 pence per share (2002 -
  nil).


Commenting on the results, George Kennedy, Chairman said:

"We commenced the year just ended with three financial objectives - to return to
profitability, to significantly reduce debt and to be in a position to
recommence the payment of dividends. It is pleasing to report that all three
objectives have been achieved.

Demand has been weaker than expected in both the UK and USA since January of
this year and we continue to see a migration of manufacturers to lower cost
regions. In these conditions profit progression will depend on our success in
managing internal costs and our growth in low cost regions.

We are winning new work in our UK and USA specialist businesses such as medical
and optical plastics and automotive lighting. Our specialist wire business is
gaining market share, particularly in China.

The second half will benefit from strong growth in the Czech Republic and China
where we will be commissioning new facilities later this year.

Although economic uncertainties persist in the short term, we remain confident
that our global strategy and the flow of new business will deliver positive
momentum."


For further information, please contact:

Carclo plc                                             On 16 June: 020 7067 0700
                                                        Thereafter: 01924 330500
Ian Williamson, Chief Executive                         
Chris Mawe, Finance Director                                       


Weber Shandwick Square Mile:                                       020 7067 0700
Richard Hews
Susanne Walker



Chairman's statement


Overview

We commenced the year just ended with three financial objectives - to return to
profitability, to significantly reduce debt and to be in a position to
recommence the payment of dividends. It is pleasing to report that all three
objectives have been achieved.

The group delivered a profit before tax of #1.2 million, a substantial recovery
from the losses of #18.5 million reported last year. Debt reduced by #9.3
million, and with net surplus property proceeds of an additional #6.0 million
received post the year end, pro forma debt stands at #28.9 million compared to
#44.3 million at 31 March 2002. The board is recommending a final dividend for
the full year of 1.2 pence per share (2002 - nil).

The operating performance was mixed, reflecting the uncertain economic climates
in Europe and the USA. Turnover from continuing operations increased by 3.2% to
#125.7 million, however, operating profits before goodwill and exceptional costs
reduced from #6.3 million to #4.4 million due to an increased pensions charge in
the year of #1.3 million (2002 - nil). The operating margin was also adversely
impacted by the start up losses at our new facilities in China and the Czech
Republic and the slow down in demand in the USA in the second half of the year.

In the year we have charged #4.7 million in exceptional costs in rationalising,
closing or disposing of businesses to maintain our focus on core activities
(2002 - #21.6 million). These exceptional costs are partly offset by the #3.0
million profit arising from the disposal of surplus properties (2002 - #0.6
million).

Earnings per ordinary share were 5.7 pence compared to a loss per ordinary share
of 35.9 pence in the prior year.


Dividend

Last year your board believed that shareholders would be best served by a
determined focus on debt reduction to protect the overall value of the group
and, accordingly, the dividend was passed. In the year just ended the group has
been highly successful at reducing debt. We are therefore recommending a final
dividend of 1.2 pence per ordinary share giving a total dividend for the year of
1.2 pence. The dividend is covered 4.7 times by post tax earnings. Subject to
shareholder approval, dividend warrants will be posted on 11 September 2003 to
shareholders on the register at close of business on 8 August 2003. The shares
will be traded excluding the right to the dividend from 6 August 2003.


Financial position

Net debt at 31 March 2003 was #34.9 million, and reflects cash generation in the
year of #9.3 million. This was ahead of our expectations and represents a
gearing level of 67%.

During the year we renegotiated our medium term facilities with our three
principal banks on less onerous covenant terms. As part of this the $35.0
million US Private Placement 6.81% loan notes were repaid at par in order to
benefit from the historically low level of bank base rates. The associated
interest hedging instruments, which were taken out when the loan notes were
issued, have been cancelled, giving rise to an interest credit of #1.5 million.

At 31 March 2003 the group had cash and unutilised assured medium term
facilities of #18.6 million. The undrawn term facilities have an average life of
four years remaining.


Employees

The success of the group is ultimately dependent upon our employees. I always
like to take the opportunity to thank them for all their hard work and in
particular to welcome those employees new to Carclo in the Czech Republic and
China.


The board

Two of our non executive directors, Peter Lee and Adam Broadbent, have stated
their intention to retire from the board at the annual general meeting to be
held on 4 September 2003. Peter Lee, aged 68, has been a long serving member of
the board of Carclo since June 1993 following the merger with Arthur Lee & Sons
plc, where he was chairman. Adam Broadbent, aged 66, joined the board of Carclo
in March 1997. Adam has served as chairman of the remuneration committee since
September 1998. I would like personally to thank both Peter and Adam for their
contribution to the development of the group. We are currently in the process of
recruiting a new non executive director.


Outlook

Demand has been weaker than expected in both the UK and USA since January of
this year and we continue to see a migration of manufacturers to lower cost
regions. In these conditions profit progression will depend on our success in
managing internal costs and our growth in low cost regions.

We are winning new work in our UK and USA specialist businesses such as medical
and optical plastics and automotive lighting. Our specialist wire business is
gaining market share, particularly in China.

The second half will benefit from strong growth in the Czech Republic and China
where we will be commissioning new facilities later this year.

Although economic uncertainties persist in the short term, we remain confident
that our global strategy and the flow of new business will deliver positive
momentum.

George Kennedy
16 June 2003




Chief executive's review

This was a year in which we delivered what we set out to achieve - building upon
our global market positions, reducing debt and returning to the dividend list
following the group's return to profitability.


Strategy - building a global market position

Although Carclo plc is a small company in terms of stock market capitalisation,
our businesses are strategically very well placed. Both Carclo Technical
Plastics and ECC Card Clothing operate globally in specialised markets with few
competitors of comparable global spread.

Carclo Technical Plastics has successfully established operations in the Czech
Republic and China modelled on our very successful USA plastics facilities. The
Czech Republic facility is growing very fast, benefiting from transfers of the
manufacturing operations of our UK customers to Eastern Europe. The China
facility, after a slow start, is also now growing quickly and is benefiting from
a similar shift of manufacturing activity from the USA to China. We are in the
process of purchasing a second factory in the Czech Republic which will come
into operation later this year.

We have chosen to develop this global capability organically by green field
start ups under our direct control. This is inevitably slower than using joint
ventures or acquisitions but delivers much better long term value and critically
allows us to ensure a uniform standard of quality, customer service and tight
control of our proprietary technology.

We have also established low cost assembly operations in Hungary in association
with an established contract manufacturing company which we are using for labour
intensive assembly operations, especially of automotive products, which are
under our direct design control. We will be further extending this relationship
in the coming year.

ECC Card Clothing serves a global market. We have wholly owned sales and service
companies in the major textile markets such as Turkey, India and the USA. We
have developed a low cost factory in India using plant and know-how transferred
from our European operations. Last year we opened a sales and service operation
in China and have made significant inroads in this previously closed market.
Later this year we will commission a manufacturing facility in China to support
the growth of our market share in the region. Consistent with our approach, this
will be a wholly owned facility.

Our key technical resources reside in the UK and the USA. Despite the trading
difficulties of the last two years, we have continued to invest in research and
development and I am pleased with the progress. Our future lies in this
technological development and its exploitation on a global basis through our
world class manufacturing facilities. The key is organic growth through well
directed research and development and appropriate capital investment. We believe
we have a powerful and attractive business model and we need to demonstrate
through the quality of our execution that we can generate superior long term
returns on capital for our shareholders.


Debt reduction

On a pro forma basis (including the receipts from the disposal of the Joseph
Sykes property) we achieved a year end debt of #28.9 million. This excellent
result was achieved despite cash from operations being below our internal
targets. Underlying operating profit was lower than expected in Technical
Plastics and we continued to spend more on rationalisation than planned at the
outset of the year. We are confident of delivering further debt reduction.
Capital expenditure needs remain modest because we are equipping the new
factories in the Czech Republic and China with surplus assets from the UK,
profits are on an improving trend and rationalisation costs are falling.
Additionally we still have surplus assets available for disposal with a book
value of #4.0 million. The board is therefore confident that the dividend can be
sustained from free cash flow and has recommended a final dividend of 1.2 pence
per share.




Operating review                                               
                                                    
                                            Carclo Technical   Carclo Specialist
                                                Plastics             Wire
                                             2003       2002     2003     2002
Turnover - continuing operations           #103.1m     #98.4m   #22.5m   #23.3m
Underlying operating profit                  #4.0m      #5.8m    #2.9m    #1.7m
Net assets                                  #44.9m     #51.0m   #11.6m   #11.7m
Operating margin                              3.9%       5.9%    12.8%     7.4%
Return on capital employed                    8.9%      11.3%    25.0%    14.8%
Average number of employees                 1,795      1,882      433      665


It was a very good year for Specialist Wire with operating margins improving
from 7.4% to 12.8% despite sales decreasing by 3.5%. Overall profitability
improved by 66% as the benefits of last year's rationalisation were realised.
ECC Card Clothing continues to see declines in the markets of the developed
world compensated by very rapid growth in China.

CTP Automotive also performed well, increasing profitability and margins on flat
turnover. Outsourcing initiatives and the elimination of manufacturing variances
boosted operating margins from 6.0% to 8.1%. We are growing our specialist
lighting range (Carclo lighting will be on show on three major super car
launches due in the next twelve months) and communications is benefiting from
the introduction of multiband (radio, GPS and GSM) technology in cars. These
growth areas are compensating for the decline in traditional lighting products.
The more mature cable controls business is also winning new contracts helped by
outsourcing to lower cost assembly locations.

The other CTP manufacturing operations had a difficult year. Operating margins
were down from 5.8% to 2.3% on turnover 7.4% ahead at #74.7 million. Behind the
margin erosion is a poor performance in the UK manufacturing operations and
start up losses in the Czech Republic and China. However, even our USA
operations, which started strongly, experienced slower demand in the second half
which resulted in capacity being idle for a period. Overall operating margins in
the USA reduced from 11.3% to 8.6%.

In the USA we are seeing a drift of manufacturing activity to lower cost
regions, principally China, and we are well placed to exploit this trend. In the
UK, the pace of decline is much higher and some sectors of UK manufacturing have
all but disappeared. In the last year our UK plastics operations have grown in a
rapidly declining market. We have seen a lot of established work move out of the
UK, often to our own facility in the Czech Republic, and we have won new work to
backfill the UK facilities. This change in work mix has produced imbalances in
our UK and, to a lesser extent, USA tooling and moulding capacity and has
increased internal operating inefficiencies. Because of the learning curve
effects, new work is initially less profitable than long established jobs and
this is the prime reason for the decline in profitability. We continue to
address the capacity issues by rationalisation wherever appropriate and we are
confident that we will do better in the year ahead at managing our manufacturing
variances.

We are seeing good growth in our specialised medical and optical businesses.
This area has been much less affected by the almost seismic shift in global
manufacturing capacity. We see exciting opportunities to further expand this
specialist area of Carclo Technical Plastics.


Ian Williamson
16 June 2003





Finance director's review

                                                              2003        2002
                                                          #million    #million
Turnover (continuing)                                        125.7       121.8
                                                          ---------     -------
Divisional operating profit                                    6.9         7.5
Central costs, net of pension                                 (2.5)       (1.2)
                                                          ---------     -------
Underlying operating profit from continuing operations         4.4         6.3
Underlying operating profit from discontinued                  
operations                                                     0.2         0.2
Goodwill amortised                                            (1.0)       (1.0)
Non recurring items                                           (1.7)      (21.0)
Interest                                                      (0.7)       (3.0)
                                                          ---------     -------
Profit / (loss) before tax                                     1.2       (18.5)
Taxation credit                                                1.7         0.2
                                                          ---------     -------
Profit / (loss) attributable to ordinary shareholders          2.9       (18.3)
Ordinary dividend                                             (0.6)          -
                                                          ---------     -------
Surplus / (deficit) for the year                               2.3       (18.3)
                                                          ---------     -------
Divisional operating margin from continuing operations         5.5%        6.2%
Basic earnings per share                                       5.7p      (35.9)p
Underlying earnings per share                                  8.2p        4.7p



Overview

The group returned to profitability last year following the prior period's #18.3
million loss. Underlying earnings per share increased by 74% to 8.2 pence and,
after a dividend of #0.6 million, the group has added #2.3 million to reserves.

Turnover from continuing operations increased by 3.2% to #125.7 million.
However, underlying operating profit from continuing operations fell by 29.2% to
#4.4 million, mainly as a result of a pension charge of #1.3 million (2002 -
nil), start up losses in China and the Czech Republic of #0.6 million (2002 -
nil) and a poorer performance in our tooling manufacturing activities. The USA
experienced some weakness in the second half, which also impacted margins.
Specialist Wire and CTP Automotive performed well increasing margins
substantially following last year's rationalisation.

Goodwill amortisation continues to run at prior year levels and relates to our
USA plastics business and CTP Coil.

During the year the group incurred net exceptional charges of #1.7 million (2002
- #21.0 million) arising from the rationalisation, closure or disposal of
subsidiaries and surplus property.

Interest payable has fallen sharply as a result of lower average debt and the
credit arising on the cancellation of interest swaps. As a result underlying
interest cover for the year is 6.7 times (2002 - 2.2 times).

The group received net tax refunds of #2.2 million representing repayments in
respect of losses from prior periods. As a result of prior year losses and
reliefs available, there is a net taxation credit of #1.7 million for the
current year (2002 - #0.2 million credit).


Dividend

The group reported an overall profit in the year after tax of #2.9 million. The
group also generated #8.9 million of free cash flow. We have therefore proposed
a final ordinary dividend in respect of the year ended 31 March 2003 of 1.2
pence per ordinary share. The dividend is covered 4.7 times by post tax
earnings.


Exceptional items

The non recurring net exceptional charges of #1.7 million (2002 - #21.0 million)
are analysed as follows:

                                                             2003         2002
                                                         #million     #million
                                                         ---------    ---------
Rationalisation of technical plastics operations              1.2          3.1
Rationalisation of specialist wire operations                   -          0.4
Impairment of surplus fixed assets                              -          0.6
Provision for diminution in value of own shares               0.1          0.5
                                                           -------      -------
Total operating exceptional charges                           1.3          4.6
Disposal of subsidiary undertakings                           1.1          1.8
Loss on termination of operations                             2.3          8.8
Profit on disposal of surplus properties                     (3.0)        (0.6)
Goodwill impaired on the Alan group                             -          6.4
                                                           -------      -------
                                                              1.7         21.0
                                                           -------      -------

Operating exceptional costs were #1.3 million, down sharply from last year's
#4.6 million. In the year we closed our wire manufacturing operations in the USA
and initiated the closure of our plastics manufacturing site in Hatfield. This
resulted in a further charge of #2.3 million disclosed as losses relating to the
termination of operations (2002 - #8.8 million).

In October 2002 we disposed of Francis W. Birkett, our non ferrous foundry
business, at a small discount to book value. After associated costs and the
reinstatement of goodwill previously written off to reserves, this resulted in a
loss of #1.1 million.

We continued to dispose of our surplus property portfolio and realised gross
proceeds of #2.6 million. Before the year end we had exchanged contracts on the
sale of the Acre Mills site in Huddersfield for gross proceeds of #6.4 million
with cash received on 3 June 2003. Including this transaction property disposals
have yielded a profit, net of costs, of #3.0 million.


Financing

During the year, the group renegotiated its credit lines with its three
principal lenders on less onerous covenant terms. Borrowing costs remain
unchanged. The group now has secured assured medium term facilities of #44.6
million repayable after 2006. These facilities are secured on the assets of
Carclo Technical Plastics Limited which, at 31 March 2003, represented 17% of
the group's gross assets.

As part of the refinancing, the group repaid at par the $35 million 6.81%
unsecured loan notes raised under a private placement in 1998. The associated
interest hedging instruments were cancelled resulting in an interest credit of
#1.5 million.


Currency risk and hedging

The group matches its foreign currency borrowings with foreign currency assets
including goodwill to hedge fluctuations in the reported balance sheet net
assets. As a result 45% of the groups term debt at the year end was denominated
in dollars and euros.

Trading currency income and expenditure is matched, where possible, by securing
supplies from an appropriate economic region thereby providing a natural hedge.

Balance sheet amounts receivable and payable are hedged when material to secure
the gross proceeds in the appropriate currency.

In this way the group seeks to minimise risks associated with foreign currency
fluctuations wherever possible.


Net debt and gearing

                                                            2003          2002
                                                        #million      #million
Underlying cash flow                                        10.9          16.9
Interest and tax                                             1.1          (4.3)
Capital expenditure, other than for expansion               (3.1)         (4.2)
                                                          -------       -------
Free cash flow                                               8.9           8.4
Other non recurring                                         (1.8)         (1.9)
Equity dividends                                               -          (5.6)
                                                          -------       -------
Cash flow available for corporate activities                 7.1           0.9
Capital expenditure for expansion                           (0.5)         (4.6)
Sale of businesses                                           1.5           3.1
Exchange movement                                            1.2             -
                                                          -------       -------
Decrease / (increase) in debt in period                      9.3          (0.6)
                                                          -------       -------


A key objective in the year has been to reduce debt. It is therefore pleasing to
report that net borrowings reduced by #9.3 million to #34.9 million representing
gearing of 67% (2002 - 89%). Debt reduced as a result of cash from trading,
sales of surplus property, taxation receipts and proceeds from business
disposals.

Free cash flow improved in the year by #0.5 million after making cash pension
contributions of #1.9 million (2002 - #0.2 million) and absorbing a small
increase in working capital of #0.2 million (2002 - #3.9 million inflow). The
group also received #2.2 million in repayments from taxation (2002 - #1.3
million cash outflow).

Capital expenditure represented 61% of depreciation at #3.6 million and #4.7
million was expended on business reorganisations and closures.

After the year end #6.0 million net proceeds were received from the sale of the
Acre Mills site formerly occupied by Joseph Sykes Brothers, bringing pro forma
year end debt to #28.9 million and gearing to 56%.

At the year end the group had assured facilities of #44.6 million with an
average life of four years. On a pro forma basis the group has unutilised
assured funds and cash of #24.6 million which is more than sufficient to fund
the ongoing development of the group.


Property

During the year the group disposed of property with a book value of #5.2 million
leaving surplus property with a book value of #4.0 million available for
disposal in due course. The group has made capital gains in the period on the
sale of surplus properties. These gains are being rolled over in accordance with
the provisions of the income and corporation tax legislation and no tax is
immediately payable.


Pensions

As reported last year the group has two large defined benefit pension schemes
which are closed to new members.

The group continues to produce its accounts under the provisions of SSAP 24. At
the balance sheet date using the last actuarial valuation, the charge to the
profit and loss account amounted to #1.3 million (2002 - nil) and represents
the costs of accruing for benefits for the existing workforce. The actual cash
contributions in respect of the pension schemes amounted to #1.7 million (2002 -
nil).

As required by the provisions of FRS17, the group has calculated the effect on
the profit and loss account and balance sheet of applying this standard. FRS17
provides a snap shot view of the pension surplus or deficit at the balance sheet
date. If implemented the overall charge to the profit and loss account would be
reduced by #0.3 million.

Due to the low levels of equity markets at 31 March 2003 and low bond yields
increasing the value of pension liabilities, under FRS17 a deficit of #24.7
million, net of tax, would have been recorded on the balance sheet (2002 - #11.0
million).

Since the year end, the group has made a #1.1 million payment to the fund in
respect of the deficit calculated under the provisions of the Minimum Funding
Requirement (MFR) at 23 May 2002. Our latest estimates are that a payment of no
more than #1.6 million will be due in May 2004. Further payments will be made
annually to eradicate the MFR deficit on the pension schemes.




Christopher Mawe

16 June 2003




Consolidated profit and loss account
year ended 31 March

                                                               2003       2002
                                                               #000       #000
                                                            --------  ---------

Turnover
Continuing operations                                       125,657    121,773
Discontinued operations                                       2,286     23,857
                                                            --------  ---------
                                                            127,943    145,630
                                                            --------  ---------
Operating profit / (loss)                                                          
Continuing operations - before exceptional costs and          
                        goodwill                              4,444      6,273
                      - exceptional costs                    (1,309)    (4,610)
                                                            --------  ---------
                      - after exceptional costs               3,135      1,663
Discontinued operations                                         235        249
                                                            --------  ---------
                                                              3,370      1,912
Goodwill amortisation                                        (1,042)    (1,042)
Goodwill impairment                                               -     (6,354)
                                                            --------  ---------
Operating profit / (loss)                                     2,328     (5,484)
                                                            
Continuing operations                                         2,093     (5,733)
Discontinued operations                                         235        249
                                                            --------  ---------
Operating profit / (loss)                                     2,328     (5,484)

Disposal of subsidiary undertakings                          (1,052)    (1,795)
Loss on termination of operations                            (2,342)    (8,825)
Profit on sale of properties                                  2,955        619
                                                            --------  ---------
Profit / (loss) before interest                               1,889    (15,485)

Net interest payable                                            702      2,992
                                                            --------  ---------
Profit / (loss) on ordinary activities before taxation        1,187    (18,477)

Taxation credit                                               1,725        204
                                                            --------  ---------
Profit / (loss) attributable to ordinary shareholders         2,912    (18,273)

Ordinary dividends                                              623          -
                                                            --------  ---------
Surplus / (deficit) for the year                              2,289    (18,273)
                                                            --------  ---------

Earnings per ordinary share

Basic and diluted                                               5.7p     (35.9)p
Underlying                                                      8.2p       4.7p
                                                            --------  ---------
Dividend per ordinary share                                     1.2p       0.0p
                                                            --------  ---------


Statement of total recognised gains and losses
Year ended 31 March

                                                               2003       2002
                                                               #000       #000
                                                            --------  ---------

Profit / (loss) on ordinary activities after taxation         2,912    (18,273)
Exchange losses on the translation of overseas assets          (607)      (289)
                                                            --------  ---------
Total gains and losses recognised since last annual          
report                                                        2,305    (18,562)      
                                                            --------  ---------





Consolidated balance sheet
as at 31 March

                                                2003                 2002
                                           #000      #000      #000       #000
                                         -------   -------    ------    -------
Fixed assets
Intangible assets                        16,981              18,023
Tangible assets                          43,666              53,642
Investments                                 313                 826
                                        -------              ------
                                                   60,960               72,491

Current assets
Stocks                                   14,135              14,045
Debtors                                  32,723              31,256
Pensions prepayment due after more than  
one year                                 12,152              11,742
Cash at bank and in hand                 10,140              17,224
                                        -------              ------
                                         69,150              74,267
                                        -------              ------
Creditors - amounts due within one
year
Bank loans and overdrafts                 8,678              11,135
Trade and other creditors                24,215              27,791
Taxation                                    199                   -
Dividends                                   623                   -
                                        -------              ------
                                         33,715              38,926
                                        -------              ------

Net current assets                                 35,435               35,341
                                                  -------              -------

Total assets less current liabilities              96,395              107,832

Creditors - amounts due after more than            
one year                                           36,202               49,773
Provisions for liabilities and                      
charges                                             8,161                8,351
                                                  -------              -------
Total net assets                                   52,032               49,708
                                                  =======              =======

Capital and reserves
Called up share capital                             2,594                2,594
Share premium                                      41,772               41,772
Revaluation reserve                                   950                2,246
Other reserves                                      1,330                1,330
Profit and loss account                             5,386                1,766
                                                  -------              -------
Equity shareholders' funds                         52,032               49,708
                                                  =======              =======





Cash flow statement
year ended 31 March
                                                                2003      2002
                                                                #000      #000
                                                             --------  --------

Cash flow from operating activities                            6,182    11,865
Returns on investments and servicing of finance               (1,033)   (3,030)
Taxation                                                       2,155    (1,290)
Capital expenditure and financial investment                    (651)   (5,623)
Acquisitions and disposals                                     1,483     3,120
Equity dividends paid                                              -    (5,622)
                                                             --------  --------
Cash inflow / (outflow) before use of liquid resources and     
funding                                                        8,136      (580)

Financing
(Decrease) / increase in debt                                (11,924)    6,517
Capital element of finance lease rentals                        (551)     (907)
                                                             --------  --------
(Decrease) / increase in cash in period                       (4,339)    5,030
                                                             ========  ========

                                                                2003      2002
                                                                #000      #000
                                                             --------  --------

Reconciliation of net cash flow to movement in net debt
(Decrease) / increase in cash in period                       (4,339)    5,030
Cash outflow / (inflow) from (decrease) / increase in debt    
and lease financing                                           12,475    (5,610)
                                                             --------  --------
Change in net debt resulting from cash flows                   8,136      (580)
Exchange movement                                              1,201       (18)
                                                             --------  --------
Movement in net debt in period                                 9,337      (598)
Net debt at beginning of period                              (44,269)  (43,671)
                                                             --------  --------         
Net debt at end of period                                    (34,932)  (44,269)
                                                             ========  ========





Turnover, operating profit / (loss) and net assets employed
year ended 31 March
                                 2003                             2002
                      Turnover Operating Net assets   Turnover Operating Net assets
                                profit                           profit
                       #000      #000      #000        #000       #000      #000

By class of business
Continuing operations
Technical plastics   
division             103,141     4,013     44,946     98,433     5,787     51,017
Specialist wire       
division              22,516     2,890     11,551     23,340     1,737     11,734
                     -------   -------   --------    -------   -------    -------
                     125,657     6,903     56,497    121,773     7,524     62,751
Exceptional costs               (1,309)                         (4,610)
                     -------   -------   --------    -------   -------    -------
                     125,657     5,594     56,497    121,773     2,914     62,751
Discontinued
operations
Technical plastics         
division                   -         -          -      9,898      (926)         -
Specialist wire        
division               2,286       235          -     13,959     1,175      2,047
                                         --------                         -------
Operating assets                           56,497                          64,798 
Unallocated net                            
liabilities (note 1)                       (4,465)                        (15,090)
                     -------             --------    -------              -------
                     127,943               52,032    145,630               49,708
                     -------   -------   --------    -------   -------    -------
Divisional operating                      
profit                           5,829                           3,163
Central administration                        
costs                           (1,190)                         (1,242)
Pension cost 
      - regular cost            (1,269)                         (1,893)
      - credit in                          
        respect of surplus           -                           1,884

Goodwill amortisation           
(note 2)                        (1,042)                         (1,042)
Goodwill impairment                  
(note 2)                             -                          (6,354)
                               -------                         -------
Group operating                  
profit / (loss)                  2,328                          (5,484)
                               =======                         =======


By geographical area
Continuing operations
United Kingdom        91,826     5,462     38,305     85,270     5,232     42,658
United States of      
America               25,223     1,939     11,639     27,523     2,625     15,896
Rest of World          8,608      (498)     6,553      8,980      (333)     4,197
                     -------   -------   --------    -------   -------    -------
                     125,657     6,903     56,497    121,773     7,524     62,751
Exceptional costs
United Kingdom                  (1,309)                         (3,869)
Rest of World                        -                            (741)
                     -------   -------   --------    -------   -------    -------
                     125,657     5,594     56,497    121,773     2,914     62,751
Discontinued
operations
United Kingdom         2,286       235          -     23,857       249      2,047
                                         --------                         -------
Operating assets                           56,497                          64,798
Unallocated net                            
liabilities (note 1)                      (4,465)                        (15,090)
                     -------             --------    -------              -------
                     127,943               52,032    145,630               49,708
                     -------   -------   --------    -------   -------    -------
Divisional operating                        
profit                           5,829                           3,163
Central administration                        
costs                           (1,190)                         (1,242)          
Pension cost                   
        -regular cost           (1,269)                         (1,893)
        -credit in                   
         respect of surplus          -                           1,884
Goodwill                        
amortisation (note 2)           (1,042)                         (1,042)
Goodwill                             
impairment (note 2)                  -                          (6,354)
                                -------                         -------
Group operating                  
profit / (loss)                  2,328                          (5,484)
                                =======                         =======
Geographical segment
 - by destination
United Kingdom        55,530                          68,695
Rest of Europe        30,049                          31,668
Rest of World         42,364                          45,267
                     -------                         -------
                     127,943                         145,630
                     -------                         -------

Notes

1.Unallocated net liabilities include interest bearing assets
  and liabilities, investments, taxation balances, capitalised goodwill and head
  office net assets.
2.Goodwill amortisation and goodwill impairment relates to
  continuing businesses within the technical plastics division.









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

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