Interim Results

Associated British Engineering PLC
8 November 2001


ASSOCIATED BRITISH ENGINEERING PLC
INTERIM REPORT 2001


ABE 
CHAIRMAN'S STATEMENT

The group made a pre-tax loss of £190,000 in the six months to 30 September 2001
compared with of £163,000 on the continuing operations in the same period last 
year. The losses for this six months include redundancy costs of £74,000, as 
reported in the my statement in the annual report for the year ended 31 March 
2001, and operating losses of £82,000 in the diesel engine remanufacturing 
division which has now been restructured.

The company has a large number of small ordinary shareholders and while the 
Board welcomes all investors in the company we are aware that some shareholders 
may not wish to retain their investment, but find it inconvenient or 
uneconomical to sell their shares at commercial dealing rates. To assist these 
shareholders we are offering a dealing service with reduced costs through our 
registrar Computershare Investor Services PLC to enable shareholders owning 175 
or fewer ordinary shares to sell their entire holding, or alternatively, to 
purchase additional shares up to a value of £2,500, with a minimum investment of
£500. This facility will be available until 25 January 2002. The documents that 
deal with this special dealing service will be sent out with this interim report
to all shareholders that own 175 or fewer ordinary shares.

The Board continues to review opportunities for developing the Group and we will
keep shareholders informed of any developments.

                                                             RA Pearce-Gould    
                                                             Chairman

8 November 2001 

                                      ABE 
                       UNAUDITED RESULTS FOR THE SIX MONTHS
                               TO 30 SEPTEMBER 2001

Audited year                                         6 months to   6 months to
 to 31.3.01                                            30.9.01      30.9.00
     £000s                                               £000s        £000s


      3,812        Turnover                              1,922        1,742 
       (156)       Restructuring costs                     (74)           -
     (4,160)       Other operating costs                (2,067)      (1,925) 
     (4,316)       Total operating costs                (2,141)      (1,925) 

       (504)       Operating loss                         (219)        (183)

        297        Exceptional profit on 
                   discontinued operations                   -          220  

                  (Loss)/profit on ordinary 
                  activities before finance costs 
       (504)              - Continuing operations         (219)        (183)
        297               - Discontinued operations          -          220  
       (207)                                              (219)          37

         51       Net finance income - Continuing            29          20
                  operations

                 (Loss)/profit on ordinary 
                 activities before taxation
       (453)             - Continuing operations           (190)       (163) 
        297              - Discontinued operations            -         220  
       (156)                                               (190)         57

         (5)     Taxation                                      -           -

       (161)     (Loss)/profit on ordinary activities      (190)         57
                 after taxation 

        (51)     Non-equity dividends                       (26)        (26)

       (212)     Retained (loss)/profit                    (216)         31

                (Loss)/profit per ordinary share 
         39p          - Continuing operations               (16)p       (14)p
         16p          - Basic                               (16p)         2p

                Dividends per share accrued but not paid:
        7.0p    7% preference                                3.50        3.50
        8.0p    8% preference                                4.00        4.00
           -    Ordinary                                        -           -

                                    ABE
                       UNAUDITED GROUP BALANCE SHEET 
                          AS AT 30 SEPTEMBER 2001


Audited                    
31.3.01                                                  30.9.01         30.9.00
£000s                                                     £000s           £000s


                FIXED ASSETS
               
        734     Tangible assets                               724         633

                CURRENT ASSETS 
              
       1,751    Stock                                       1,638       1,385
           -    Properties held for sale                        -         926
       1,051    Debtors - amount falling due within           925         885
                one year     
       2,019    Cash at bank and in hand                    1,578       1,328
       4,821                                                4,141       4,524

       1,519    Creditors - amounts falling due within      1,015         916
                one year     
       3,302    Net current assets                          3,126       3,608

       4,036    Total assets less current liabilities       3,850       4,241
          17    Creditors - amounts falling due after one year 23          23
          32    Provisions for liabilities and charges         29          35
       3,987    Net assets                                  3,798       4,183

                CAPITAL AND RESERVES 
              
       3,339    Called up share capital                     3,339       3,339
       5,038    Share premium account                       5,038       5,038
          11    Other reserves                                 11          11
      (4,401)   Profit and loss account                    (4,590)     (4,205)
       3,224    Equity shareholders' funds                  3,009       3,445
         763    Non Equity shareholders' funds                789         738

                             
       3,987    Total shareholders' funds                   3,798       4,183


STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
 
        (161)   (Loss)/profit for the period                 (190)         57
          22    Foreign Exchange adjustment                     -           -
        (139)   Total recognised gains and losses            (190)         57
                for the period     

The foreign exchange adjustment represents exchange gains during the period 
relating to the restatement of the balance sheet and results of Danway Limited, 
incorporated in the Cayman Islands.


                            ABE
               UNAUDITED GROUP CASHFLOW STATEMENT 
               FOR THE SIX MONTHS TO 30 SEPTEMBER 2001


Audited Year                                        6 months to    6 months to 
to 31.3.01                                              30.9.01      30.9.00 
£000s                                                   £000s        £000s 

                OPERATING ACTIVITIES

        (755)   Cash flow from operating activities          (275)      (140)
 
                RETURNS ON INVESTMENTS AND 
                SERVICING OF FINANCE
 
          56    Finance income received                        30         73 
          (3)   Finance costs paid                              -        (45)   
          (2)   Finance costs element of finance               (1)        (8)
                lease rental payment         
                Net cash flow from returns of 
          51    investments and servicing of finance           29         20

                TAXATION

           -    UK Taxation paid                              (5)          -

                CAPITAL EXPENDITURE AND FINANCIAL 
                INVESTMENT

         (83)   Purchase of tangible fixed assets            (31)         (5)
          45    Net proceeds on sale of tangible fixed         -          33
                assets
         (38)                                                (31)         28

                DISPOSALS AND CLOSURES

        (300)   Acquisition of Kelvin Diesels               (148)          -
         121    Sale of the Middle East operations             -         (41)
         889    Discontinued catering equipment operations     -          310
         885    Properties held for sale                       -            -
       1,595    Net cash flow from disposals and closures   (148)         269

         853    Cash (outflow)/inflow before financing      (430)         177

                FINANCING

         (12)   Decrease in debt                              (5)         (6)
         (47)   Capital element of finance lease payments     (6)        (46)
         (59)                                                (11)        (52)
 
          794   (Decrease)/increase in cash in the period   (441)        125


                                 ABE
                  UNAUDITED RESULTS FOR THE SIX MONTHS 
                           TO 30 SEPTEMBER 2001

The calculation of earnings per ordinary share is based on;
                                      2001                    2000
                               Earnings     Earnings    Earnings     Earnings
                                            per share                per share
                                £000s          pence     £000s       pence

(Loss)/profit for the 
financial year                  (190)                      57
Less preference dividends        (26)                     (26)
(Loss)/profit attributable 
to ordinary shareholders        (216)           (16)       31            2
Add loss/(profit) on 
discontinued operations 
before taxation                     -              -     (220)         (16)
Loss arising from continuing
operations                      (216)           (16)     (189)         (14)

                               Number                    Number

Weighted average number of
ordinary share in issue
during the year            1,313,427                   1,313,427


1. The comparative figures for the year to 31 March 2001 are abridged from the  
   accounts for that year and do not constitute full accounts within the meaning
   of Section 240 of the Companies Act 1985 (as amended). Statutory accounts for
   that period, on which the Auditors gave an unqualified opinion, have been    
   delivered to the Registrar of Companies.

2. This interim report has been prepared in accordance with the accounting      
   policies adopted in the latest published accounts. This interim report has   
   neither been audited nor reviewed by our auditors.

3. As required by Financial Reporting Standard 4 the non-equity dividends have  
   been charged to the profit and loss account and then added back to reserves  
   because the company does not have sufficient reserves to make this payment.  
   The cumulative amount of preference dividends unpaid at 30 September 2001 was
   £77,000.