Re Cost Reduction Plan

RNS Number:2051T
Danka Business Systems PLC
12 December 2003


Embargoed for release until 2:00pm                           12th December 2003


                           DANKA BUSINESS SYSTEMS PLC
                           ("Danka" or "the Company")

                      Danka Announces Cost Reduction Plan
         Actions Expected to Result in Annual Savings of $40-45 Million

Danka Business Systems PLC, a leading independent global provider of office
imaging systems and services, today provided more details regarding the cost
restructuring plan which it previously announced on 4 November 2003. The
restructuring plan is expected to result in total annual savings of
approximately $40 to $45 Million which exceeds the company's previous estimate
of $30 million.

The plan includes the consolidation and elimination of surplus real estate
facilities, primarily in the U.S. and United Kingdom, and the elimination of
approximately 675 jobs in the U.S., United Kingdom, Italy, Spain, Germany,
Canada, Mexico, Puerto Rico and Brazil.

As a result of the employee severence and related costs, and the costs
associated with the real estate changes the Company expects to take a charge of
$25 to $35 Million, primarily over the two fiscal quarters ending 31 December
2003 and 31 March 2004. The Company expects that most of the charge will be
classified as Restructuring in the Company's income statement with the balance
to flow through normal operations.

"In recent years Danka has had a high cost structure, partly due to our
acquisition legacy and the resulting, extensive analog machine population. Now,
because of the improvements we have made in our U.S. IT system, the completion
of the U.S. Headquarters consolidation and other actions, we can attack and
reduce our high cost structure. This restructuring plan will help us reduce
costs as we endeavor to drive improved operating margins in Fiscal 2005. It is
also a major first step toward our reaching an SG&A goal of 30% of revenue. We
will continue to aggressively pursue other cost savings as well," said Lang
Lowrey, Danka's Chairman and Chief Executive Officer.

The Company expects that the charge will result in approximately $10 to $15
Million in cash requirements over the next year.

"For the past few years we have been focused largely on improving our balance
sheet and back office operations, and we are pleased with our progress,"
continued Lowrey. "We have also incubated high value growth initiatives that are
being well accepted in the marketplace. Moving forward, it is incumbent upon us
to get these cost structure improvements behind us so we can focus on growth.
Our equipment population is now approximately 50% digital, which means that we
are approaching the point where we should begin to see growth and reverse the
revenue declines we have been experiencing these past five years."

The Company will discuss this cost reduction plan and its further cost reduction
efforts in its third quarter earnings conference call which is expected to take
place in early February.

                                    - ends -

Enquiries:

Danka Business Systems PLC                                       020 7605 0150
Paul Dumond, Company Secretary                                   

Weber Shandwick Square Mile                                      020 7067 0700
Katie Hunt

About Danka
Danka delivers value to clients worldwide by using its expert technical and
professional services to implement effective document information solutions. As
one of the largest independent providers of office imaging equipment, document
solutions and related services and supplies Danka enables choice, convenience
and continuity. Danka's vision is to empower customers to benefit fully from the
convergence of image and document technologies in a connected environment. This
approach should strengthen the Company's client relationships and expand its
strategic value.

Forward-Looking Statements: Certain statements contained in this press release,
or otherwise made by our officers, including statements related to our future
performance and our outlook for our businesses and respective markets,
projections, statements of our plans or objectives, forecasts of market trends
and other matters, are forward-looking statements, and contain information
relating to us that is based on our beliefs as well as assumptions, made by, and
information currently available to, our management. The words "goal",
"anticipate", "expect", "believe" and similar expressions as they relate to us
are intended to identify forward-looking statements, although not all
forward-looking statements contain such identifying words. No assurance can be
given that the results in any forward-looking statement will be achieved. For
the forward-looking statements, we claim the protection of the safe harbor for
forward-looking statements provided for in the Private Securities Litigation
Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. Such statements reflect our current views
with respect to future events and are subject to certain risks, uncertainties
and assumptions that could cause actual results to differ materially from those
reflected in the forward-looking statements.




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

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