Final Results

RNS Number:9124M
Merchant House Group PLC
30 June 2003



                            Merchant House Group Plc

               Final results for the year ended 31 December 2002

Highlights

*                    Focus on corporate financial and investment advisory
                     activities
*                    Change of name from Airow PLC to Merchant House Group Plc
*                    FSA authorisation obtained in May 2003
*                    Focused new director and advisory team with relevant skills

Peter Cotgrove, Chairman, commented:

"The Company has concentrated in recent months on achieving a flow of fee-based
income and on containing and reducing costs.  A number of corporate transactions
have now been completed and significant new mandates have been won.  In addition
to progress on the corporate advisory front, the Company has established an
investment advisory business focused on specialist investment funds and
products.

The Directors remain mindful of the need to establish a more solid foundation to
the business and, to that end, continue to review acquisition prospects.  A
number of such prospects are now actively under negotiation and others are under
review."



                                                                    30 June 2003



Press enquiries:

Merchant House Group Plc
Peter Cotgrove, Chairman                        020 7332 2200
Peter Redmond, Director

Shore Capital
Alex Borrelli / Simon Edwards                        020 7408 4090

First City Financial Public Relations
Allan Piper                        020 7436 7486



Merchant House Group Plc

Final results for the year ended 31 December 2002

Chairman's Statement

The year to 31 December 2002 was one of transition for the Company, as it began,
in the second half of the year, to put in place the foundations for the new
business strategy referred to in the former Chairman's Statement for the six
months to 30 June 2002.  The Group has begun to evolve from a pure cash shell
and is establishing the basis for a corporate financial and investment advisory
business.  I am delighted to report that within the past few weeks we have moved
an important step forward in that strategy by securing regulatory authorisation
for our wholly-owned subsidiary, Merchant Capital Plc, from the Financial
Services Authority.

The Company's name was changed from Airow Plc to its present name on 22 October
2002.  A circular regarding inter alia the change of business strategy will be
sent to shareholders in the near future, after which we hope to be able rapidly
to build on the foundations we have now established.

Inevitably, the process of establishing a new business activity entailed certain
costs, while additional legal, consultancy and operating costs were incurred on
a number of business initiatives which did not in the event come to fruition.
In all some #100,000 of external costs were incurred in relation to these
business initiatives, plus significant amounts of management time.  As a result,
the Group incurred a loss before taxation of #201,665 in the second half of the
year, following a loss of #70,508 in the first half.  The loss per share
amounted to 4.0p for the year under review.

However, in the final quarter, corporate fees and commissions arising from
non-regulated activities amounted to #90,960, arising from activities related to
the proposed new business strategy and a number of new business prospects
identified.

Upon Geoffrey Dart's resignation, I was appointed Executive Chairman on 27
January 2003, following the end of the period under review.  Since then, a small
but focused Director and Executive team has been appointed, with a range of
skills and experience in corporate finance and broking, investment and
investment research, and the Company now operates from a small City office.

The Company has concentrated in recent months on achieving a flow of fee-based
income and on containing and reducing costs.  A number of corporate transactions
have now been completed and significant new mandates have been won.  In addition
to progress on the corporate advisory front, the Company has established an
investment advisory business focused on specialist investment funds and
products.

The Directors remain mindful of the need to establish a more solid foundation to
the business and, to that end, continue to review acquisition prospects.  A
number of such prospects are now actively under negotiation and others are under
review.

It only remains for me to thank all the Company's staff, Directors and Advisors
for their assistance over the period and to express confidence as to a positive
outcome for their efforts in the coming months.

                                                                    30 June 2003



Peter Cotgrove
Executive Chairman


Consolidated Profit and Loss Account

                                                                         Year to       17 July 2000 to
                                                                31 December 2002      31 December 2001
                                                                               #                     #

Turnover                                                                  90,960                     -

Cost of sales                                                           (30,000)                     -

Gross Profit                                                              60,960                     -

Administrative costs                                                   (383,027)             (134,744)

Group Operating Loss                                                   (322,067)             (134,744)

Interest receivable                                                       49,894                83,055

Loss on Ordinary Activities Before Taxation                            (272,173)              (51,689)

Tax on loss on ordinary activities                                             -                     -

Loss on Ordinary Activities after Taxation                             (272,173)              (51,689)

Loss per share                                                            (4.0p)               (0.79p)
Diluted loss per share                                                    (4.0p)               (0.80p)



Consolidated Balance Sheet

As at 31 December                                                              2002                2001
                                                                                  #                   #

Current Assets
Debtors                                                                      49,244               9,722
Cash at bank and in hand                                                  1,079,374           1,325,991

                                                                          1,128,618           1,335,713

Creditors:  Amounts falling due
 within one year                                                           (73,040)             (7,962)

Net Current Assets                                                        1,055,578           1,327,751

Total assets less current liabilities                                     1,055,578           1,327,751

Capital and Reserves
Called-up equity share capital                                              340,000             340,000
Share premium account                                                     1,039,440           1,039,440
Profit and loss account                                                   (323,862)            (51,689)

Equity Shareholders' Funds                                                1,055,578           1,327,751




Consolidated Cash Flow Statement

                                                                   Year to 31 December        17 July 2000 to
                                                                                  2002       31 December 2001
                                                                                     #                      #
Reconciliation of operating profit to net cash
(Outflow) from operating activities
Operating loss                                                               (322,067)              (134,744)
Increase in debtors                                                           (39,522)                (4,004)
Increase in creditors                                                           65,078                  7,962

Net cash outflow from operating activities                                   (296,511)              (130,786)


CASH FLOW STATEMENT
Net cash outflow from operating activities                                   (296,511)              (130,786)

Returns on investments and servicing of finance
Interest received                                                               49,894                 77,337

Cash outflow before financing                                                (246,617)               (53,449)

Financing : Issue of Share Capital                                                   -              1,379,440

(Decrease)/Increase in Cash                                                  (246,617)              1,325,991


Reconciliation of net cash flow to movement in net debt
(Decrease)/Increase in cash in the period

Change in net debt/funds                                                     (246,617)              1,325,991
Net funds at 1 January                                                       1,325,991                      -

Net funds at 31 December                                                     1,079,374              1,325,991



Analysis of changes in net funds
                                              At 1 January 2002         Cashflows       At 31 December 2002

Cash at bank and in hand                              1,325,991         (246,617)                 1,079,374


NOTES

1.         Basis of preparation

The financial information set out in the announcement does not constitute the
statutory accounts for the year ended 31 December 2002 or the period ended 31
December 2001. The financial information for the period ended 31 December 2001
is derived from the statutory accounts for that period which have been delivered
to the Registrar of Companies. The auditors reported on those accounts; their
report was unqualified and did not contain a statement under s237(2) or (3)
Companies Act 1985. The statutory accounts for the year ended 31 December 2002
will be delivered to the Registrar of Companies following the Company's annual
general meeting.

2.         Tax on loss on ordinary activities

In view of the tax losses in the year, the Directors are of the opinion that no
provision for corporation tax is required.

3.         Loss per share

The loss per share has been calculated on the net basis on the Group deficit for
the financial year, after taxation, of #272,173 (2001: #51,689) using the
weighted average number of ordinary shares in issue of 6,800,000 (2001:
6,575,965).

Diluted loss per share has been calculated using the weighted average number of
ordinary shares in issue, diluted for the effect of share options.  There were
no share options in existence at the year end (2001: 300,000).

4.                  Calendar

The annual report and accounts have been mailed to registered shareholders at
their registered addresses and copies are available to the public at the
Company's Registered Office, 7th Floor, Aldermary House, 15 Queen Street, London
EC4N 1TX.

The report and accounts contain notice of an Annual General Meeting which will
take place at 7th Floor, Aldermary House, 10-15 Queen Street, London EC4N 1TX on
7 August 2003 at 2.00p.m.


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