Interim Results

RNS Number:2583T
Airbath Group PLC
15 December 2003

                             Airbath Group plc
                       Interim Results Announcement

Airbath Group plc (the "Group"), a specialist manufacturer and supplier of spa
baths, special needs baths, standard baths and bathroom products, announces
interim results for the period ended 30 September 2003.


Highlights of the Results:

 -   Profits in line with guidance in Preliminary Announcement of 30 September
     2003
 -   Profit before tax of #11k (2002: #500k)


Regarding Prospects, Clive Gilham, Executive Chairman, commented:


"The second half of the year will be a period of consolidation for the Group
with a primary focus upon debt reduction. Operating profit is likely to be lower
than the first half which is likely to result in a full year loss before
taxation. Nevertheless, we believe that there are many opportunities for growth,
especially for our Airbath(R) and Appollo(R) product ranges, and we remain committed
to the long term development of the Group."


For further information please contact:


Airbath Group plc

Clive Gilham
Executive Chairman                Tel: [phone]


Brown, Shipley & Co. Limited

Philip Johnson                    Tel: [phone]




CHAIRMAN'S STATEMENT

Financial Results

Our interim results for the six months to 30 September 2003 reflect the
challenging trading conditions advised in the 2003 Annual Report and Accounts,
which warned that order intake and trading volumes in the period since the year
end had been well below those achieved last year. Consequently, the reported
profit before tax of the Group was #11,000 compared to #500,000 for the same
period last year. The operating profit of #148,000 was below last year's
#656,000 principally reflecting lower sales.


Balance Sheet

The Group balance sheet at 30 September 2003 shows net liabilities of #1,207,000
(31 March 2003: #1,215,000), primarily due to the merger reserve created at the
time of the demerger of the Group from Aquarius Group plc in 2001. Net debt of
#3,499,000 (31 March 2003: #3,566,000) was #354,000 lower than 12 months
earlier.


Review of Operations

Aquabeau - turnover #4,212,000 (2002: #4,920,000)

Aquabeau specialises in the design and manufacture of spa baths, hydraulic and
walk-in baths, quality standard baths, shower trays and bath panels.


Aquabeau's sales fell during the period, in part due to the exceptionally hot
summer weather. Nevertheless, Aquabeau remains profitable with good operating
margins and we remain committed to our strategy of expanding its product range
and strengthening its brands. Consequently, we have recently updated the
Airbath(R) product range with new, simpler to fit, warm air injection units, new
models and an updated product marketing brochure. Further marketing investments
are being made in the remainder of the financial year. The Appollo(R) range of
walk-in baths has secured new sources of supply, which will now enable demand to
be met on a timely basis. Meanwhile, the Aquarius range has witnessed a recent
upturn in demand. The moving water segment of the market is growing
significantly and this is served by a number of our products, including an
increasing range of whirlpools.


Brampton Housewares - turnover #2,517,000 (2002: #3,120,000)


Brampton Housewares, the bathware collection, continues to manufacture, assemble
and distribute a range of bathroom cabinets and accessories.


Brampton Housewares has continued to suffer in an increasingly tough market with
consolidation amongst its customer base and aggressive price competition from
direct imports. Recent redundancies have reduced overheads but placed a greater
demand on the young management team, who have performed well in the face of
adversity and produced a profit for the period, albeit significantly below the
same period last year. New products are being developed and a number of moulding
suppliers have been established, providing improved quality of product.


Dividends

Trading conditions, together with the deficit on profit and loss reserves, have
led to the decision to pay no interim dividend (2002: #25,000). During the year,
the Group accrued preference dividends of #91,000 (31 March 2003: #100,000), but
these cannot be paid and will not be paid in the foreseeable future. The cost of
this dividend has been recognised in the profit and loss account as a finance
cost and credited back through profit and loss reserves.


Strategy

The Group's strategy is to focus the existing niche businesses on their
profitable brands and product ranges. An emphasis on design and quality will
continue to be supported by a culture of customer service.


Prospects and Current Trading

The second half of the year will be a period of consolidation for the Group with
a primary focus upon debt reduction. Operating profit is likely to be lower than
the first half which is likely to result in a full year loss before taxation.
Nevertheless, we believe that there are many opportunities for growth,
especially for our Airbath(R) and Appollo(R) product ranges, and we remain committed
to the long term development of the Group.


Going Concern

As explained in the 2003 Annual Report and Accounts issued on 30 September 2003,
the Group breached its banking covenants during the period. All the bank
facilities are now repayable on demand and the revolving debt facility has been
reduced from #2.5m to #1.6m. The bank has not demanded repayment of its loans,
which have been reclassified as repayable in less than one year. The overdraft
and invoice discounting facilities have not been affected. As there has been no
fundamental change in the Group's financial position since that date, the
Directors believe that it is appropriate that the financial statements continue
to be prepared on a going concern basis.


Clive Gilham
Executive Chairman
15 December 2003



CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the six months ended 30 September 2003

                                        Six months     Six months         Year
                                             ended          ended        ended
                                           30 Sept        30 Sept     31 March
                                              2003           2002         2003
                                       (unaudited)    (unaudited)    (audited)
                              Notes          #'000          #'000        #'000

Turnover                                     6,729          8,039       15,303

Cost of sales                               (4,301)        (4,950)     (10,156)

Gross profit                                 2,428          3,089        5,147

Operating expenses (net)

- exceptional                                  (10)             -         (114)

- other                                     (2,270)        (2,433)      (4,169)

Operating profit                               148            656          864
Interest payable (net)                        (137)          (156)        (305)

Profit on ordinary                              11            500          559
activities before taxation

Tax on profit on ordinary                       (3)          (149)        (150)
activities

Profit on ordinary                               8            351          409
activities after taxation

Preference dividends              5            (91)          (100)        (192)

Ordinary dividends                5              -            (25)         (25)

Retained (loss)/profit for                     (83)           226          192
the financial period


Basic and fully diluted           3          (0.33)p         0.99p        0.85p
(loss)/earnings per share





CONSOLIDATED BALANCE SHEET
as at 30 September 2003

                                             As at          As at        As at
                                           30 Sept        30 Sept     31 March
                                              2003           2002         2003
                                       (unaudited)    (unaudited)    (audited)
                                             #'000          #'000        #'000
Fixed assets
Tangible assets                              1,596          1,636        1,681
Intangible assets                                3              3            3

                                             1,599          1,639        1,684
Current assets
Stocks                                       1,852          1,696        1,788
Debtors                                      3,159          3,983        3,392
Cash                                             -            234            -

                                             5,011          5,913        5,180
Creditors: amounts falling due within       (7,716)        (5,156)      (5,220)
one year

Net current (liabilities)/assets            (2,705)           757          (40)

Total assets less current                   (1,106)         2,396        1,644
liabilities

Creditors: amounts falling due after             -         (3,249)      (2,758)
more than one year

Provisions for liabilities and                (101)          (170)        (101)
charges

Net liabilities                             (1,207)        (1,023)      (1,215)

Capital and reserves
Called up share capital                      2,856          3,104        2,856
Share premium account                           92             92           92
Other reserve                               (3,894)        (4,142)      (3,894)
Profit and loss account                       (261)           (77)        (269)

Shareholders' deficit                       (1,207)        (1,023)      (1,215)




CONSOLIDATED CASH FLOW STATEMENT
for the six months ended 30 September 2003

                                        Six months     Six months         Year
                                             ended          ended        ended
                                           30 Sept        30 Sept     31 March
                                              2003           2002         2003
                                       (unaudited)    (unaudited)    (audited)
                                             #'000          #'000        #'000

Operating profit                               148            656          864
Non-cash exceptional item                        -              -         (250)
Depreciation                                   178            181          350
(Increase)/decrease in stocks                  (64)            28          (64)
Decrease/(increase) in debtors                 233           (222)         369
(Decrease)/increase in creditors              (348)           (16)         298

Net cash inflow from operating                 147            627        1,567
activities

Returns on investment and servicing            (99)          (133)        (487)
of finance
Taxation                                       104            164          152
Capital expenditure - net                      (93)          (107)        (321)
Equity dividends paid                            -            (99)        (109)

Cash inflow before financing                    59            452          802
Financing                                     (169)          (159)        (380)

(Decrease)/increase in cash in the            (110)           293          422
period

Reconciliation of net cash flow to movement in net debt

                                        Six months     Six months         Year
                                             ended          ended        ended
                                           30 Sept        30 Sept     31 March
                                              2003           2002         2003
                                       (unaudited)    (unaudited)    (audited)
                                             #'000          #'000        #'000

(Decrease)/increase in cash in the            (110)           293          422
period
Cash outflow from decrease in debt
and financing leasing                          168            203          379
                                               
Non-cash movements                               9              -          (18)

Decrease in net debt                            67            496          783
Opening net debt                            (3,566)        (4,349)      (4,349)

Closing net debt                            (3,499)        (3,853)      (3,566)




NOTES TO THE INTERIM FINANCIAL INFORMATION

 1.  The interim results for the period ended 30 September 2003 are unaudited
     and do not constitute statutory accounts within the meaning of s.240 of the
     Companies Act 1985. The statutory accounts of Airbath Group plc for the
     period ended 31 March 2003 have been filed with the Registrar of Companies
     and contain an unqualified audit report.

 2.  The interim results for the period ended 30 September 2003 have been
     prepared in accordance with the accounting policies adopted in the accounts
     for the year to 31 March 2003.
 3.  The calculation of basic and fully diluted loss per share for the six month
     period ended 30 September 2003 is based on loss after taxation and accrued
     preference dividends of #83,000 (2002: profit of #251,000) divided by
     25,408,461 1p ordinary shares (2002: 25,408,461), being the weighted
     average number in issue during the period. The year to 31 March 2003 is
     based on profits after tax of #217,000 divided by 25,408,461 ordinary
     shares. There are no dilutive potential ordinary shares in issue in any of
     the periods.

 4.  There were no recognised gains or losses other than the profit for the
     period.

 5.  Dividends for the period ended 30 September 2003 total #91,000 (2002:
     #125,000) and comprise accrued dividends on the preference shares (2002:
     interim dividend of 0.10p per ordinary share and preference dividends of
     #100,000). The cost of this dividend has been recognised in the profit and
     loss account as a finance cost and added back through profit and loss
     reserves.

 6.  Copies of these interim results will be sent to shareholders.





Editor's Notes:

Airbath Group has four well-established brands:

* Airbath(R), which is the UK market leading brand of spa baths, which is also
applied to quality standard baths.
* Aquarius Bathrooms, which is applied to standard baths and shower trays for the
mid-priced sector of the market.
* Appollo(R), which is the assisted bathing brand applicable to a range of 
products designed specifically for elderly, infirm and physically less able 
users. These include baths with powered seats, walk-in baths and wheelchair 
accessible shower trays
* Brampton Housewares, which manufactures, assembles and distributes ranges of
bathroom products that are sold by DIY chains, supermarkets, catalogue stores
and other retail outlets throughout the UK and Europe.


Website: www.airbathgroup.co.uk


About the Airbath(R) system:

The Airbath(R) system is a patented system invented by the founder of Airbath
International which involves warm air being pumped through hundreds of tiny
holes in the base of the bath. The Airbath(R) offers a very different bathing
experience from those offered by other moving water systems, in particular
whirlpool baths. There are a number of features that set the Airbath(R) apart from
competing products:

* Unlike whirlpool baths, which typically have a small number of nozzles through
which water is pumped into the bath, each Airbath(R) has between 185 and 385 air
jets to provide an "all over" massage effect;
* The Airbath(R) pumps warm humid air through the water (using its patented warm 
air injection system), unlike some rival products which pump cold air causing 
bath water to cool faster;
* The Airbath(R) is inherently more hygienic than whirlpool baths as there is no
danger of water from the last bath standing in the pipes between baths. 
Airbath(R) are therefore particularly suited for hotels or other locations where 
usage may be infrequent; and unlike whirlpool baths, which will only work if the 
water is deep enough to cover the nozzles (which are often fitted to the sides 
of the bath), an Airbath(R) will work with only a very small amount of water 
covering the bottom of the bath. This makes Airbaths(R) well suited for bathing 
young children.


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