Interim Results

12 March 2007

                  PipeHawk Plc ("the Group" or "the Company")                  

                                Interim Results                                

                   for the six months ended 31 December 2006                   

I am delighted to report that the Group's progress continues.

The turnover for the six months ended 31 December of £2,547,000 is an increase
of more than two and a half times that for the corresponding period in 2005 (£
970,000) and the retained profit for the six months is £13,000, compared with a
loss of £100,000 in the same period last year.

These figures include a full six months' contribution from QM Systems Limited
("QM Systems"), it has integrated well and has been assisting PipeHawk with its
planned introduction of the next generation of PipeHawk development, now that
the GPR industry is regulated. QM Systems is however being affected by
unexpected management and policy changes at Smiths Aerospace, which has caused
a reduction in workflow from that customer. New order intake from a more
targeted marketing effort is already yielding a much more diverse and better
spread of customers.

Continuing on the technology front, PipeHawk, with nine European partners, has
been awarded €2.15 million by the EU to develop a Ground Probing and Imaging
Radar system, specifically to detect damage to water pipes throughout the EU.
The consortium members have estimated that there are over half a million water
pipe breakages / new leaks annually throughout the EU. PipeHawk's primary
responsibility is to oversee the effective exploitation of this new technology.

Adien and SUMO both continue to grow and expand in their respective market
places, following the issue to them of the first Ofcom licences in September
last year. The issue of these licences has assisted in differentiating our
services as all companies which use GPR must now be registered and regulated to
operate legally.

During the period SUMO sold four further franchises and is now operating
effectively throughout mainland Great Britain.

Adien is steadily getting larger contracts and is being involved earlier in the
decision making process in the planning of highway construction projects. To
cope with this success we have invested in extending Adien's premises and
adding further equipment and teams to its resources.

The MineHawk EU grant is progressing slowly but steadily through the offices of
the European Commission; we are confident that funding for this landmine
detection vehicle will be announced during the course of this financial year.

In summary, again, trading continues to improve and we continue to look forward
to the future with confidence.

Gordon Watt

Chairman

12 March 2007

SUMMARISED CONSOLIDATED PROFIT AND LOSS ACCOUNT

for the six months ended 31 December 2006

                                         Note     Six months to   Six months to
                                                    31 December     31 December
                                                           2006            2005
                                                                               
                                                    (Unaudited)     (Unaudited)
                                                                               
                                                           £000            £000
                                                                               
Turnover                                                                       
                                                                               
Group and share of joint venture                          2,547             970
                                                                               
Less: share of joint venture                              (529)           (244)
turnover                                                                       
                                                                               
Turnover - continuing operations                          2,017             726
                                                                               
Operating costs                                           2,060           (841)
                                                                               
Operating loss                                             (43)           (115)
                                                                               
Share of operating profit / (loss)                           39               5
in joint venture                                                               
                                                                               
Loss on ordinary activities before                          (4)           (110)
interest and taxation                                                          
                                                                               
Group interest payable and similar                         (29)            (20)
charges                                                                        
                                                                               
Loss on ordinary activities before                         (33)           (130)
taxation                                                                       
                                                                               
Tax on profit on ordinary                  2                 46              30
activities                                                                     
                                                                               
Retained profit/(loss) for the                               13           (100)
period                                                                         

                                                             p              p              
                                                                               
Profit/(Loss) per share                                                        
                                                                               
Basic and diluted                          3               0.05           (0.3)

SUMMARISED CONSOLIDATED BALANCE SHEET

at 31 December 2006

                                          Note    31 December  31 December 2005
                                                         2006                  
                                                                    (Unaudited)
                                                  (Unaudited)                  
                                                                               
                                                         £000              £000
                                                                               
Fixed assets                                                                   
                                                                               
Intangible assets                                       1,091               234
                                                                               
Tangible assets                                           325               256
                                                                               
Investment in joint venture                                54                 1
                                                                               
                                                        1,470               491
                                                                               
Current assets                                                                 
                                                                               
Stocks                                                    516               284
                                                                               
Debtors                                                   541               438
                                                                               
                                                        1,057               722
                                                                               
Creditors: amounts falling due within                 (1,172)             (846)
one year                                                                       
                                                                               
Net current liabilities                                 (115)             (124)
                                                                               
Total assets less current liabilities                   1,355               367
                                                                               
Creditors: amounts falling due after                    (569)             (630)
one year                                                                       
                                                                               
Net assets /(liabilities)                                 786             (263)
                                                                               
Capital and reserves                                                           
                                                                               
Called up share capital                                   269               232
                                                                               
Share premium account                                   4,839             4,081
                                                                               
Profit and loss account                               (4,322)           (4,576)
                                                                               
Equity shareholders' funds/(deficit)        6             786             (263)

SUMMARISED CONSOLIDATED CASH FLOW STATEMENT

for the six months ended 31 December 2006

                                             Note   Six months to Six months to
                                                      31 December   31 December
                                                             2006          2005
                                                                               
                                                      (Unaudited)   (Unaudited)
                                                                               
                                                             £000          £000
                                                                               
Net cash outflow from operating              4, 5            (50)          (22)
activities                                                                     
                                                                               
Returns on investment and servicing of                       (29)          (20)
finance                                                                        
                                                                               
Corporation tax received                                       46            80
                                                                               
Capital expenditure and financial                                              
investment                                                                     
                                                                               
Payments for fixed assets                                    (13)          (25)
                                                                               
Cash (outflow) /inflow before use of                         (46)            13
liquid resources and financing                                                 
                                                                               
Financing                                                                      
                                                                               
New loans                                                      11            50
                                                                               
Repayment of loans                                           (39)          (37)
                                                                               
Capital elements of finance payments                         (25)             -
                                                                               
Issue of ordinary shares less expenses                         25             -
                                                                               
(Decrease)/ increase in cash                                 (74)            26

NOTES TO THE FINANCIAL STATEMENTS

for the 6 months ended 31 December 2006

 1. Basis of accounting
   
The consolidated interim financial statements have been prepared on the basis
of the accounting policies set out in the Group's 2006 financial statements.
The interim financial statements are unaudited and do not constitute full
financial information as defined in section 240 of the companies Act 1985 (as
amended). The comparative figures for the six months ended 31 December 2005 do
not comprise full financial statements. No account has been taken of the
trading results or any other transactions entered into by the Group since 31
December 2006.

 2. Taxation
   
No corporation tax was payable as a result of losses arising and the Company
benefits from the Government's "Research and Development Tax Credit Scheme".

 3. Profit/(Loss) per share
   
                                                 Six months to      Six months to 
                                                   31 December        31 December
                                                          2006              2005
                                                   (Unaudited)        (Unaudited)

                                                                      
These have been calculated on losses                   £13,041        £100,130
of:                                                                           
                                                                              
The weighted average number of                      26,897,803      23,203,808
shares was:                                                                   
                                                                              
Basic and diluted                                        0.05p          (0.3p)

4. Reconciliation of operating loss to net cash outflow from operating
    activities
   
                                                  Six months to     Six months to
                                                    31 December      31 December
                                                          2006             2005                  
                                                   (Unaudited)       (Unaudited)    
                                                                               
                                                          £000             £000
                                                                               
Operating loss                                            (43)            (115)
                                                                               
Depreciation and amortisation                               85               70
                                                                               
Movement in stocks                                         241             (21)
                                                                               
Movement in debtors                                        428             (19)
                                                                               
Movement in creditors                                    (792)               63
                                                                               
Net cash outflow from operations                          (50)             (22)

 5. Reconciliation of net cash flow to movement of net debt
   
                                                   Six months to    Six months to
                                                     31 December      31 December
                                                            2006             2005
                                                     (Unaudited)       (Unaudited)
                                                            £000          £000
                                                                              
Change in cash                                              (74)            26
                                                                              
Cash inflow/ (outflow) from increase/                         53            37
(decrease) in debt and lease finance                                          
                                                                              
Net (increase)/decrease in debt resulting from             (21)            13
cashflows                                                                     
                                                                              
New finance leases                                          (43)          (56)
                                                                              
Movement in net debt for the period                         (64)          (43)
                                                                              
Opening net debt                                           (794)         (677)
                                                                              
Closing net debt                                           (858)         (720)

 6. Reconciliation of movement in shareholders' funds
   
                                                   Six months to Six months to
                                                     31 December   31 December
                                                            2005          2005
                                                                              
                                                     (Unaudited)   (Unaudited)
                                                                              
                                                            £000          £000
                                                                              
Profit/(Loss) for the period                                  13         (100)
                                                                              
Net proceeds of shares issued                                 25              
                                                                              
Increase/(Decrease) in shareholders'                          38         (100)
funds                                                                         
                                                                              
Opening shareholders' funds                                  748         (163)
                                                                              
Closing shareholders' funds                                  786         (263)

 7. Dividends
   
The directors are not proposing the payment of a dividend in respect of the six
months ended 31 December 2006.

 8. Copies of interim results will be sent to shareholders shortly and will
    also be available at the Company's registered office, Systems House, Mill
    Lane, Alton, Hampshire GU34 2QG.