Feedback PLC - Interim Results

RNS No 1203c
FEEDBACK PLC
16th December 1998

                                 Feedback PLC                                 
                         - Interim Statement for the                          
                       period to 30th September, 1998 -                       

Chairman's Interim Statement

I forewarned in the announcement issued in September that the downturn in
export business being experienced by the Group's main subsidiary, Feedback
Instruments, would lead to half year losses for the Group.  On turnover of
#3.65M, down 30% on the same period last year, the Group made a pre-tax loss
of #337,900 including #116,600 to cover reorganisation costs.  This
reorganisation should show annual savings of approximately #600,000 and have
some beneficial effects in the second half.  In view of the results, no
interim ordinary dividend is recommended.

As I have already mentioned, the Instruments Company had a poor first half
year.  This Company relies heavily on overseas business, with 80% of its sales
being export dependent, and the strength of sterling has undoubtedly affected
the Company's competitiveness generally.  Specifically, however, it has
suffered badly from the weakened economic situation in the Far East where our
business fell dramatically compared with previous levels.  As a consequence of
this, steps were taken to reduce costs, which included a redundancy programme,
and these costs are included in the Group's first half year results.

With regard to business in the UK, it is pleasing to report a major
improvement in the funding available for UK colleges and universities
following recent Government announcements.  The Instruments Company and our
joint venture company, TekniCAL, are well placed to benefit from these
Government initiatives and should secure substantial business for delivery in
the second half.

Feedback Data has continued the improvement seen over the past year and has
had a very good first six months trading.  An increase in turnover, together
with an improvement in margins has led to a marked increase in profitability. 
Demand for Data Capture Terminals, the Company's core business, has improved
with additional opportunities in prospect through an enlarged VAR (Value Added
Reseller) network.  The Access Control/Security product range is now
established in the market and has been further enhanced.  This range, together
with a new portable data capture unit, is providing an increasing contribution
to the business.  Current trends indicate that the strong first half year's
performance should be maintained through the second half year. Feedback Data's
German subsidiary operated satisfactorily during the period under review.  The
fundamental reorganisation carried out twelve months ago has resulted in a
more viable operation.

Feedback Incorporated had a good first half year, consolidating on the
progress made over the past year.  It is anticipated that this subsidiary will
continue to operate satisfactorily.

The Group is operating on a reduced cost base following the reorganisation at
Feedback Instruments and, in spite of the export difficulties, the level of
sales enquiries and potential remains high throughout the Group.

DH Harding
Chairman
16 December 1998

                                 FEEDBACK PLC                                 
                           PROFIT AND LOSS ACCOUNT                            

                               Six Months to   Six Months to       Year to    
                                  30 Sept 98      30 Sept 97   31 March 98 
                                      #'000s          #'000s        #'000s
                     
Turnover                             3,649.3         5,255.8       9,843.9
                     
Operating (loss)/profit               (225.5)          290.7         603.6
                     
Share of operating loss of 
joint venture                           (0.5)              -         (23.0)
                     
Reorganisation costs                  (116.6)              -             -
                     
Net interest receivable/(payable)        1.7            (9.6)        (23.2)
                                     -------         -------       -------    
(Loss)/profit on ordinary activities  (337.9)          281.1         557.4
                     
Tax on (loss)/profit on ordinary 
activities                                 -               -        (103.2)
                                     -------         -------       -------   
(Loss)/profit for the period          (337.9)          281.1         454.2
                                     -------         -------       -------

Ordinary dividends paid and proposed       -               -             -
                     
Preference dividends paid               76.0            71.5         148.8
                     
(Deficit)/earnings per share           (4.82p)          2.47p         3.60p
                     
Diluted (deficit)/earnings per share   (4.82p)          1.80p         2.80p


                                FEEDBACK PLC                                 
                                BALANCE SHEET                                 

                               Six Months to   Six Months to       Year to 
                                  30 Sept 98      30 Sept 97   31 March 98 
                                      #'000s          #'000s        #'000s
                     
Fixed Assets                           617.0           667.0         657.0
                     
Current Assets                     
Stocks                               1,837.7         1,843.7       1,734.2
Debtors                              2,212.6         3,565.8       2,753.4
Cash at bank and in hand               890.7           240.0         929.3
                                     -------         -------       -------
                                     4,941.0         5,649.5       5,416.9
                     
Creditors                     
Amounts falling due within 
one year                            (1,682.4)       (2,123.6)     (1,804.7)
                                     -------         -------       -------
Net Current Assets                   3,258.6         3,525.9       3,612.2
                                     -------         -------       -------
Total assets less current 
liabilities                          3,875.6         4,192.9       4,269.2
                     
Creditors                     
Amounts falling due after 
more than one year                    (283.1)         (293.7)       (252.1)
                                     -------         -------       -------
Net assets                           3,592.5         3,899.2       4,017.1
                                     -------         -------       -------    
                     
Capital and reserves                     
Ordinary share capital                 861.9           848.2         849.7
Preference share capital             1,520.7         1,548.2       1,545.2
Reserves                             1,209.9         1,502.8       1,622.2
Shareholders' funds                  3,592.5         3,899.2       4,017.1


                                 FEEDBACK PLC                                 
                              CASHFLOW STATEMENT                              

                               Six Months to   Six Months to       Year to 
                                  30 Sept 98      30 Sept 97   31 March 98 
                                      #'000s          #'000s        #'000s
                     
Net cash (outflow)/inflow 
from operating activities              (67.2)          (57.6)        838.3
                     
Returns on investments and 
servicing of finance                     1.7            (9.6)        (23.2)
                     
Preference dividend paid               (76.0)          (71.5)       (148.8)
                     
Corporation tax (paid)/recovered       (20.1)          108.0          90.1
                     
Capital expenditure                    (37.0)          (45.3)        (83.3)
                     
Acquisitions                               -               -         (50.0)
                     
Financing                              (13.5)        1,185.0       1,175.2
                     
Management of liquid resources        (150.0)              -        (350.0)
                     
(Decrease)/increase in cash           (362.1)        1,109.0       1,448.3



           Reconciliation of operating profit to operating cashflow           
          
                               Six Months to   Six Months to       Year to 
                                  30 Sept 98      30 Sept 97   31 March 98 
                                      #'000s          #'000s        #'000s
                     
Operating (loss)/profit               (222.5)          290.7         603.6
                     
Reorganisation costs                  (116.6)              -             -
                     
Depreciation charges                    77.1           119.6         231.1
                     
Profit/(loss) on sale of 
tangible fixed assets                      -            (8.0)        (38.5)
                     
Exchange difference                    (11.3)          (51.0)        (22.2)
                     
(Increase)/decrease in stocks         (103.5)          (98.7)         10.8
                     
Decrease/(increase) in debtors         540.8          (194.0)        618.4
                     
(Decrease)/increase in creditors      (231.2)         (116.2)       (564.9)
                     
Net cash (outflow)/inflow from 
operating activities                   (67.2)          (57.6)        838.3


Note:
The interim figures for the six months to 30 September 1998, which are
unaudited, have been prepared on the basis of the accounting policies set out
in the Annual Report and Accounts for the year ended 31 March 1998.  The
Financial information contained in this Interim Report does not amount to full
accounts within the meaning of Section 240 of the Companies Act 1985.

The results for the year ended 31 March 1998 are extracted from the published
accounts for that period on which the auditors gave an unqualified report and
which have been filed with the Registrar of Companies.

The deficit per share for the six months ended 30 September 1998 is based on
the Group loss on ordinary activities after taxation and preference dividends
of #413,900 attributed to 8,593,721 ordinary shares, being the weighted
average number of ordinary shares in issue.  Diluted earnings per share is
calculated on the weighted average number of ordinary shares assuming the
conversion of all the 1,520,689 Convertible Redeemable Cumulative Preference
Shares (7,603,445 ordinary shares) and the exercise of share options (85,330).
The Group loss on ordinary activities after taxation has been adjusted by the
preference dividend paid.  However, in accordance with the Financial Reporting
Standard (FRS) 14, as neither of these conversions have a dilutive effect, the
deficit per share figure remains unaltered.

Copies of this announcement will be posted to shareholders in due course.

Enquiries:    Roger Barnett
              Feedback plc
              01892 653 322

END

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