Interim Results

Manpower Software PLC
28 February 2003

28 February 2003



Manpower Software plc ("Manpower Software" or "the Company")



Interim Results for the six months ended 30 November 2002



Chairman's Statement



Results

In the first six months of the current trading year, the Company made a loss of
£1.32 million (2001: loss of £0.58 million) on turnover of £0.86 million (2001:
£1.7 million).



Undoubtedly, this result for the six months to 30 November 2002 is a
disappointment.  However, we do not consider that it is reflective of the
current level of prospects and confirmed sales that the Company expects to be
able to recognise in the second half of the financial year.  Delays in closing
significant contracts have had a negative impact on our result for the period.
Two of these contracts, with the Royal Fleet Auxiliary and Norwegian Cruise
Lines, have now been signed.  In addition, commercial terms for a third
contract, with a major global shipping company, have been agreed.



In October 2002 the Royal Fleet Auxiliary signed a contract to upgrade its MAPS
Crew Administration software to the current release.  This will allow the Royal
Fleet Auxiliary to control the management, scheduling and deployment of crew
throughout their fleet of 21 vessels, as well as providing banking and foreign
currency bookkeeping facilities for the crew.  However, in accordance with
Manpower Software's accounting policies, the revenue associated with this
contract of approximately £0.2 million will be recognised in the second half of
the financial year.  A three-year support contract and a contract to provide
further enhancements have also been agreed and signed.



In December 2002 a contract to supply our MAPS Crew Administration software was
signed with Norwegian Cruise Lines Limited.  Excluding annual support, this is
valued at approximately £1.1 million, of which licence fee revenue to be
recognised in the second half of the financial year is £0.66 million.  Norwegian
Cruise Lines is based in Miami, Florida, and is part of the Star Cruises Group,
the world's fourth largest cruise line.



This month Manpower has agreed commercial terms with a major global shipping
company.  Further details relating to this contract will be announced in due
course.  However, this new customer will use the MAPS software to manage crew
scheduling, recruitment, travel administration, training, plus shore and fleet
IT personnel.  The overall size of the deal is expected to be in the same order
of magnitude as the deal signed with Norwegian Cruise Lines.



Operational Review

Our growth and leading position in the cruise industry continued during the six
months to 30 November 2002 and now sees the MAPS software being used or
implemented in four out of the top five companies in this industry, including
Carnival Corporation, P&O Princess and Royal Caribbean.  As stated above, we
have also recently signed a contract with Norwegian Cruise Lines.  This position
of strength has enabled us to make progress in the maritime market outside of
cruise.



Within the UK Ministry of Defence we have continued to work with the Territorial
Army and HQ Medical Group, where our software is being used to assist in the
deployment of UK forces around the world. The potential is for our software to
be used to deploy a manpower planning solution across the whole of the
Territorial Army and, thereafter, to the Regular Forces as well.  Our software
can be used to provide accurate forecasting of the Army's fitness for role, its
training requirements, and the associated costs of exercise and deployment.



Our activities in the NHS have continued resulting in an important breakthrough
where we have secured our first contract to supply MAPS Foresight.  This product
is being used within the NHS Trust at Derriford, Plymouth, to provide a solution
to the problems of establishment control and workforce planning.  In particular,
MAPS Foresight will be used to predict the future demand for different types of
staff and seek to match this with available supply, ensuring that there are
sufficient staff available with the right skills to deliver high quality care to
patients.  This solution is being actively marketed to other NHS trusts.



During the period, we have made some changes to the composition of the Board.
Paul Scandrett, formerly Head of UK Operations, has been appointed Managing
Director.  Jack Debnam, Non-Executive Director, did not stand for re-election to
the Board.  Ian Lang stepped down as Chairman and has reverted to Non-Executive
Director, the position to which he was first appointed.  Ian remains as Chairman
of the Audit and Remuneration Committees, however.  I resigned as Managing
Director to become Non-Executive Chairman.  The cost savings resulting from
these and other personnel changes amount to approximately £0.35 million per
annum, the benefit of which will first be felt in the second half of this
financial year.



Dividend

The Directors have declared that there will be no interim dividend.



Strategic Review

During the last three months the Board has reviewed the Company's strategy.   In
the short to medium term the Company intends to focus its sales efforts on
opportunities in the markets of global maritime and UK government, where we have
positions of strength.  Supporting this focus a number of changes are being
made:



•         the business has been restructured to reflect a market led (maritime /
government), rather than geographic (UK / US), sales approach.



•         we will seek to broaden the Company's portfolio of products and
associated services, building upon the excellent relationships established with
our major clients.


•         partner activities will be focused on developing our existing markets.



In the maritime market, we have achieved our objective of becoming the leading
provider of crew management software to the cruise market.  The business drivers
which led to our success in the cruise market, namely cost management,
legislative compliance, growth control and security post September 11th remain
evident.  We now also intend to:



•         target the worldwide maritime industry, not just the cruise market
          sector.



•         make sales of additional products into the existing customer base.



•         offer associated services around the product, including partnerships
          with other leading vendors.



Our objective is to become:



The leading provider of crew management software to the global maritime
industry.



In the government market, we have two objectives:



To be the leading provider of force deployment software to the European defence
market.



In the defence sector, we are seeking to build upon the success we have had
within the UK Territorial Army, the Royal Fleet Auxiliary and NATO.  We will
also aim to increase revenue by selling additional or enhanced software to
existing customers and targeting opportunities in army and naval deployment.



To be the leading provider of workforce development software to the UK NHS.



In the NHS, building upon the success of our first sale to the Plymouth Acute
NHS Trust, we aim to market our software to the 606 other NHS Trusts in
operation in the UK, every one of which is a potential customer.



Outlook

We are pleased to have agreed the new contracts as detailed above and commenced
implementation work on existing contracts in the cruise sector.  We are
currently in on-going negotiations for additional sales of our products to the
stated markets of maritime, government, defence and the NHS and consider that
the level of new sales prospects is encouraging for the future of the Company.



As a result of the recently won contracts, together with on-going revenues from
established customers, the Company anticipates that second half revenues will be
considerably higher than in the past.  The Board is satisfied, subject to any
unforeseen circumstances, that the Company will be profitable in the second half
of the financial year.



Finally, I would like to thank all our shareholders, employees, customers and
suppliers for their continued support.



Robert Drummond

NON-EXECUTIVE CHAIRMAN

28 February 2003





Enquiries:



Manpower Software plc

Robert Drummond, Non-Executive Chairman                      020 7389 9500
Paul Scandrett, Managing Director
Simon Thorne, Finance Director

Strand Partners Limited
Rory Murphy, Director                                        020 7409 3494

Shore Capital
Alex Borrelli, Director                                      020 7408 4090





Consolidated Profit and Loss Account






                                                Note         (Unaudited)     (Unaudited)     (Unaudited)

                                                          6 months ended  6 months ended  6 months ended

                                                        30 November 2002     31 May 2002     30 November
                                                                                                    2001
                                                                       £               £               £

Turnover - continuing operations                                 866,166       1,600,663       1,698,657

Cost of sales                                                   (43,714)        (12,327)        (74,632)
Selling and operational expenses                             (1,380,513)     (1,568,947)     (1,523,168)

Gross (loss)/profit                                            (558,061)          19,389         100,857

Administrative expenses                                        (770,227)       (672,957)       (699,575)

Operating loss
Continuing operations                                        (1,328,288)       (653,568)       (598,718)

Interest receivable                                               13,036           1,380          19,375

Interest payable                                                 (9,368)        (16,846)         (4,314)

Loss on ordinary activities before taxation                  (1,324,620)       (669,034)       (583,657)

Taxation                                                               -               -               -

Loss on ordinary activities after taxation                   (1,324,620)       (669,034)       (583,657)

Dividends                                                              -               -               -

Loss retained                                                (1,324,620)       (669,034)       (583,657)

Loss per share

Basic                                           3                (2.99)p         (2.70)p         (2.44)p
Diluted                                         3                (2.99)p         (2.70)p         (2.44)p






There were no recognised gains or losses other than the profit for the financial year.







Consolidated Balance Sheet
                                                             (Unaudited)     (Unaudited)        (Unaudited)

                                                                   As at           As at              As at

                                                        30 November 2002     31 May 2002   30 November 2001
                                                                       £               £                  £
Fixed assets
Tangible assets                                                  318,294         345,464            378,543


Current assets
Work in progress                                                       -               -             14,031
Trade and other debtors                                        1,304,160       1,720,089          1,706,509
Cash at bank and in hand                                         487,312       1,400,659             49,410
                                                               1,791,472       3,120,748          1,769,950

Creditors: amounts falling due within one year                 (737,863)       (736,523)        (1,019,837)

Net current assets                                             1,053,609       2,384,225            750,113

Total assets less current liabilities                          1,371,903       2,729,689          1,128,656

Creditors: amounts falling due after more than                  (53,569)        (86,736)          (114,115)
one year
Net assets                                                     1,318,334       2,642,953          1,014,541



Capital and reserves
Called up share capital                                        2,212,254       2,212,254          1,195,813
Share premium account                                          6,429,879       6,429,879          5,148,874
Profit and loss account                                      (7,323,799)     (5,999,180)        (5,330,146)
Equity shareholders' funds                                     1,318,334       2,642,953          1,014,541




Consolidated Cash Flow Statement




                                                 Note         (Unaudited)     (Unaudited)         (Unaudited)

                                                        6 months ended 30  6 months ended      6 months ended
                                                            November 2002     31 May 2002
                                                                                             30 November 2001
                                                                        £               £                   £

Net cash outflow from operating activities       6              (818,265)       (651,339)         (1,350,143)

Returns on investments and servicing of finance
Interest received                                                  13,036           1,380              19,375
Interest paid                                                     (5,000)        (13,851)             (3,021)
Finance lease interest paid                                       (4,368)         (2,995)             (1,292)
Net cash inflow/(outflow) from returns on                           3,668        (15,466)              15,062
investments and servicing of finance

Capital expenditure and financial investment
Payments to acquire tangible fixed assets                        (67,320)        (66,269)           (256,776)
Cash outflow before financing                                   (881,917)       (733,074)         (1,591,857)

Financing
Issue of ordinary shares                                                -       2,642,747                   -
Expenses of share issue                                                 -       (345,301)                   -
New loans                                                               -               -             171,864
Capital element of finance lease rentals                         (31,431)        (37,661)            (24,318)
Net cash (outflow)/inflow from financing                         (31,431)       2,259,785             147,546

(Decrease)/increase in cash                                     (913,348)       1,526,711         (1,444,311)




NOTES TO INTERIM REPORTS
for the 6 months ended 30 november 2002

1.                BASIS OF PREPARATION

The interim financial statements have been prepared in accordance with
applicable accounting standards and under the historical cost convention.  The
principal accounting policies of the Group have remained unchanged from those
set out in the Group's 31 May 2002 annual report and financial statements.  The
interim financial statements have been reviewed by the Group's auditors.  The
auditors' review report is disclosed below.





2.                TAXATION

There are no tax charges for the half year as there are sufficient tax losses to
extinguish any liability for the period.





3.                EARNINGS PER SHARE
                                                 6 months ended    6 months ended 31   6 months ended
                                                                   May 2002
                                               30 November 2002                        30 November 2001
                                                              £     £                  £

Loss for the financial period                         1,324,620     669,034            583,657

Weighted average number of shares                        Number     Number             Number

                                                      of shares      of shares          of shares

For basic earnings per share                         44,245,086     24,751,694         23,916,263
For diluted earnings per share                       44,245,086     24,751,694         23,929,720





4.                DIVIDENDS

No dividends have been paid or proposed for the period.





5.                PUBLICATION OF NON-STATUTORY ACCOUNTS

The financial information set out in this interim report does not constitute
statutory accounts as defined in Section 240 of the Companies Act 1985.  The
figures for the year ended 31 May 2002 have been extracted from the statutory
financial statements which have been filed with the Registrar of Companies.  The
auditors' report on those financial statements was unqualified and did not
contain a statement under Section 237(2) of the Companies Act 1985



6.             Net cash outflow from operating activities
                                                      (Unaudited)        (Unaudited)     (Unaudited)

                                                      6 months ended 30   6 months ended 6 months ended
                                                      November 2002      31May           30 November
                                                                                         2001
                                                                         2002
                                                      £                  £               £

Operating loss                                        (1,328,288)        (653,568)       (598,718)
Depreciation and amortisation charges                 91,346             94,506          57,008
Loss on sale of tangible fixed assets                 3,144              4,842           7,687
Decrease/(increase) in debtors                        415,929            (13,581)        (518,416)
Decrease/(increase) in work in progress               -                  14,031          (14,031)
Increase/(decrease) in creditors                      (396)              (97,569)        (283,673)
Net cash outflow from operating activities            (818,265)          (651,339)       (1,350,143)





7.                RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
                                                      (Unaudited)        (Unaudited)     (Unaudited)

                                                      6 months ended 30   6 months ended 6 months ended
                                                      November 2002      31 May          30 November
                                                                                         2001
                                                                         2002
                                                      £                  £               £

(Decrease)/increase in cash in the period             (913,348)          1,526,711       (1,444,311)
Capital inflow/(outflow) from increase/(decrease) in              31,431 37,661          (148,986)
debt and finance leases
Change in net debt resulting from cash flows          (881,917)          1,564,372       (1,593,297)
Inception of finance leases                           -                  -               -
Movement in net debt in the period                    (881,917)          1,564,372       (1,593,297)
Cash at 31 May 2002                                            1,248,794 (315,578)       1,277,719
Cash at 30 November 2002                                         366,877 1,248,794       (315,578)





8.                ANALYSIS IN CHANGE IN NET DEBT
                                                   (Unaudited)       (Unaudited)      (Unaudited)

                                                   6 months ended 30  6 months ended  6 months ended
                                                   November 2002     31 May           30 November 2001

                                                                     2002
                                                    £                £                £

Cash at bank and in hand                            487,312          1,400,659        49,410
Overdraft                                           -                -                (175,462)
Finance leases                                      (120,435)        (151,865)        (19,045)
New loans                                           -                -                (170,481)
                                                    366,877          1,248,794        (315,578)





INDEPENDENT REVIEW REPORT TO MANPOWER SOFTWARE PLC

Introduction

We have been instructed by the company to review the financial information for
the six months ended 30 November 2002 which comprises the consolidated profit
and loss account, the consolidated balance sheet, the consolidated cash flow
statement and the related notes 1 to 5. We have read the other information
contained in the interim report which comprises only the Chairman's Statement
and considered whether it contains any apparent misstatements or material
inconsistencies with the financial information.  Our responsibilities do not
extend to any other information.



Directors' Responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors.  The directors
are responsible for preparing the interim report in accordance with the AIM
Rules, which require that the accounting policies and presentation applied to
the interim figures should be consistent with those applied in preparing the
preceding annual accounts except where any changes, and the reasons for them,
are disclosed.



Review Work Performed

We conducted our review in accordance with guidance contained in Bulletin 1999/4
"Review of Interim Financial Information" issued by the Auditing Practices Board
for use in the United Kingdom.  A review consists principally of making
enquiries of management and applying analytical procedures to the financial
information and underlying financial data and, based thereon, assessing whether
the accounting policies and presentation have been consistently applied unless
otherwise disclosed.  A review excludes audit procedures such as tests of
controls and verification of assets, liabilities and transactions.  It is
substantially less in scope than an audit performed in accordance with United
Kingdom auditing standards and therefore provides a lower level of assurance
than an audit.  Accordingly, we do not express an audit opinion on the financial
information.



Review Conclusion

On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 November 2002.













GRANT THORNTON
CHARTERED ACCOUNTANTS

LONDON
28 February 2003


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