AGM Statement

Bodycote International PLC
29 May 2002



Date:  Embargoed until 7.00am, Wednesday 29 May 2002


                           AGM STATEMENT - MAY 2002


On 20th March we indicated that trading in 2002 had begun slowly.  Although
there have been positive signals from some sectors the slow pattern has
continued through April and May with group sales running at levels similar to
those in quarter four of 2001.  Turnover for the four months to the end of April
2002 was £151m, some 11% below the comparable period of last year and marginally
below the levels experienced in the second half of 2001.

Heat Treatment has begun to show a modest recovery in general engineering and
automotive in both the USA and the UK.  This has not yet materialised in
continental Europe but off take in those markets has now stabilised.  Aerospace
and Industrial Gas Turbine (IGT) requirements softened in quarter one 2002 but
now appear to have steadied, helped by increased defence spending and initial
work for the Airbus A380.  Oil & Gas work this year has been solid in Europe but
very weak in the Southwest US.

HIP sales have been affected by the softness in Aerospace and also by a
continuing slow down in IGT work, particularly in the UK.

Telecoms and electronics demand in both Sweden and the UK remains at very low
levels and continue to impact our Coatings business.

Our most resilient area has been Materials Testing, particularly in the UK,
which has been helped by firm Oil & Gas markets.

We continue to take out costs in all areas of the business in the face of
continuing margin and cost pressures.  Our main focus is the rationalisation of
some of our facilities.  Prior to the end of last year, 5 plants were closed
with sales transferred to other locations.  In 2002 we have so far announced the
closure of a further 9 plants.  Our in depth review of the Coatings business is
expected to be concluded shortly.  This is likely to include further reductions
in capacity and possibly divestiture of some plants which do not have a clear
market fit with the rest of the group.  There will be some one off charges
relating to all these initiatives that still have to be fully determined but
will be in the order of £15m - £18m, most of which will fall into the first half
of 2002.  We expect annualised savings of c.£10m, which should improve
profitability in the second half of 2002, although the full benefit will not be
seen until next year.

The Group remains focused on improving cash flow and particularly reducing the
level of capital expenditure.

Bodycote is pursuing an increasing number of outsourcing opportunities, for
example, earlier this month we entered into an agreement with Delphi Corp. to
provide heat treatment and coatings services at their diesel systems plant at
Gillingham (UK).

As previously stated the timing of a recovery in demand in our various markets
is crucial to the outcome for the year


                                    - ENDS -


For further information, please contact:

David Landless, Finance Director
Bodycote International PLC                            Tel no:  020 7269 7278

Jon Simmons                                           Tel no:  020 7269 7278
Financial Dynamics


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