Preliminary unaudited results

Elektron PLC
25 May 2006



Embargoed for release: 7:00 a.m. 25 May 2006



                              ELEKTRON PLC

       Preliminary unaudited results for the year ended 31st January 2006

Elektron PLC ('Elektron'), the AIM quoted Engineered Components company
announces its preliminary results for the year ended 31st January 2006.

Key Points:

   • Profit before taxation, excluding goodwill and discontinued items UP 14%
    to £1,771,000

   • Earnings per share, before goodwill, UP 10% to 1.65p

   • Proposed final dividend UP 17% to 0.35p per share

   • Current order intake UP 15%

   • Share buyback programme commenced with 2.1 million shares purchased to
     date

   • A number of growth initiatives in hand including new sales subsidiary in
     China and portfolio of new products

For further information please contact:

Adrian Girling                       Roland Cornish
Executive Chairman                   Chairman
Elektron PLC                         Beaumont Cornish Limited
Tel: [phone]                   Tel: [phone]


Chairman's Statement

Last year was hard work, but great fun.

We are beginning to see the ongoing benefits of our relentless efforts to reduce
costs by moving manufacturing offshore, coupled with the enthusiasm of our
global distribution partners as they embrace our determined efforts to re-invent
the business by developing innovative products beyond our traditional
electromechanical experience.

At our exhibition stand at Domotechnica in Koeln, the premier European
Exhibition for Home Appliances, we displayed a range of new products, including
smart indicators, temperature logging devices, cooker hood controls and timer
switches. Most important, our distributors as well as OEM customers old and new
are starting to recognise Elektron as a forward looking engineering innovator.

To date we have invested in excess of £100k in developing electronic products.
Whilst it will be some while before the sales of these higher margin products
have a significant impact on the bottom line, we are already seeing the positive
effects on customer order levels for traditional products, through a
distribution chain motivated by the prospect of something new.

With a strong balance sheet, we are well positioned to cope with the recent
dramatic increases in material prices, especially metals. Where we already
maintain good price levels achievable because of high quality and service
levels, we are not so squeezed as some of our competitors who are now forced to
raise prices. Also, owing to a strategy of global procurement and manufacturing,
we have some natural hedging to offset the decline in the US dollar. The ability
to 'ride out' the currency and commodity price fluctuations gives us
opportunities to win market share.

Recognising the ever growing opportunities in China and Asia Pacific in general,
we are taking steps to transition our business there from a factory primarily
structured for export, to a 'Wholly Owned Foreign Enterprise' which will allow
us to trade directly into that market. We are hiring and training sales
personnel to be based at the major cities. We have transferred the first
auto-assembly machine to our factory in China, as part of the programme to
enable the factory to function as a wholly independent designer and manufacturer
of Elektron products.

Results

Turnover on continuing operations was £22,467,000 (2005: £22,683,000). Last
year's figure included a one-off benefit of around £800,000 relating to the
order backlog following the acquisition of Arcolectric.

Gross margins rose from 36.4% to 37.5%, in the face of metal and plastics price
increases which were more than offset by the transfer of hand assembly to
Tunisia.

Operating profit margins before goodwill rose to 8.0% compared with 6.9% the
previous year. With continued cash generation the net interest charges have
reduced to £16,000 compared to £101,000 in the year ended 31 January 2005.

In accordance with FRS 21 the comparative figures have been restated to show
dividends in the period in which they were paid.

Balance sheet & cashflow

Robust trading has continued to strengthen the balance sheet with net funds
increasing to £443,000 after repayment of £589,000 of lease finance obligations.
All existing asset loan finance will be repaid by the end of the financial year.

Because of the increase in profitability the Group now has to pay UK Corporation
tax by instalments instead of in arrears. Consequently £203,000 on account of
the liability arising in the year has been paid as well as the liability for the
previous year, giving a total tax paid of £814,000.

Capital expenditure of £546,000 was paid from cash reserves rather than by
taking on asset finance and cash of £309,000 was paid for provisions previously
made relating to the transfer of assembly to Tunisia.

£150,000 was received from maturing loan notes on the sale of a previous
subsidiary.

£205,000 was spent on the consolidation and purchase of our own shares which was
almost offset by the issue of new shares following the exercise of a third party
option to sell a cash shell to us in exchange for shares.

Earnings per share, dividends and purchase of own shares

Basic earnings per share for the year ended 31 January 2006, were 1.65p (year
ended 31 January 2005: 1.50p before goodwill).

The Board is proposing a final dividend of 0.35p per share (2005: 0.3p) payable
on 8 August 2006.

The Board will also look for opportunities to purchase the Company's shares on
market subject to funds not being required elsewhere.

Future strategy

Whilst continuing to develop new electromechanical products to maintain and grow
our market share, we are exploiting our position in existing markets to
introduce innovative electronic solutions to existing customers. By winning more
of the wallet of our customers we see the opportunity to grow faster than the
markets we serve.

We are strengthening our distribution organisation to grow faster in Asia
Pacific, North America and Eastern Europe.

The Bulgin business, which has been located in Barking for many decades, is
expected to move its moulding, press, plating and logistics operations by the
first quarter of 2007 and the lease on the existing site will be surrendered in
accordance with the break clause. This move will be a significant one-time cost
with excellent payback.

Elektron continues to be active in searching for and assessing suitable
acquisition targets. Some proposals have included manufacturers of engineered
products operating outside its traditional sphere of activity. The Board is
optimistic about concluding a transaction in the current year.

Outlook

The current year has started well with orders up 15% to £6,447,000 in the first
quarter compared with the same period last year.

Adrian Girling
Executive Chairman


Group Profit and Loss Account
Preliminary unaudited results for year ended 31 January 2006
                                                                         As restated
                                                      2006                      2005
                                                                                2004
                                                     £'000                     £'000

Turnover - continuing operations                    22,467                    22,683
         - discontinued operations                       0                       333
                                                    22,467                    23,016

Cost of sales                                     (14,041)                  (14,635)

Gross profit                                         8,426                     8,381

Net operating expenses                             (6,639)                   (5,711)

Operating profit/(loss) - continuing                 1,787                     1,653
                          operations
                        - negative goodwill 
                          release                        0                     1,080
                                                     1,787                     2,733
                        - discontinued 
                          operations                     0                      (63)
Operating profit                                     1,787                     2,670

Profit on disposal of discontinued operations            0                        33

Profit on ordinary activities before interest        1,787                     2,703

Net interest payable                                  (16)                     (101)

Profit on ordinary activities before taxation        1,771                     2,602

Taxation on profit on ordinary activities            (485)                     (574)

Profit attributable to shareholders                  1,286                     2,028

Earnings per ordinary share - basic                  1.65p                     2.67p

Earnings per ordinary share before goodwill -        1.65p                     1.50p
basic



Amo




 Group Balance Sheet                                                            
 Preliminary unaudited results as at 31 January
 2006                                          
                                                                              As         
                                                                        restated  
                                                31 January            31 January
                                                      2006                  2005     
                                                     £'000                 £'000
 Fixed assets                                                        
 Tangible assets                                     2,165                 2,528

 Current assets                                                      
 Stocks                                              3,266                 3,000
 Debtors                                             4,661                 3,946
 Cash at bank and in hand                            1,714                 1,581

                                                     9,641                 8,527

 Creditors: amounts falling due within one year    (4,818)               (4,363)

 Net current assets                                  4,823                 4,164

 Total assets less current liabilities               6,988                 6,692

 Creditors: amounts falling due after more than          0                  (512)
 one year                                                  

 Provisions for liabilities and charges               (435)                 (729)

 Net assets                                          6,553                 5,451

 Capital and reserves                                    
 Called - up share capital                           3,954                 3,821
 Share premium                                         244                   244
 Capital redemption reserve                             68                     0
 Other reserves                                          2                    20
 Profit and loss account                             2,285                 1,386
 Own shares                                              0                   (20)

 Shareholders' funds                                 6,553                 5,451



Group Cash Flow Statement

Preliminary unaudited results for the year ended
31 January 2006

                                               31 January            31 January
                                                     2006                  2005
                                                    £'000                 £'000

Cash flow from operating activities                 1,636                 1,849

Returns on investments and servicing of finance
Interest received                                      66                    62
Interest paid                                         (32)                  (53)
Interest element of hire purchase and
finance lease payments                                (49)                 (110)
                                                      (15)                 (101)

Taxation
UK Corporation tax paid                              (763)                  (17)
Overseas tax paid                                     (51)                  (41)
                                                     (814)                  (58)
Capital expenditure and financial investment
Payments to acquire tangible fixed
assets                                               (546)                 (558)
Proceeds of sale of tangible fixed
assets                                                 28                    11
                                                     (518)                 (547)

Acquisitions and disposals
Sale of subsidiaries                                  150                   671
Cash disposed of on sale of subsidiary                  0                   (13)
                                                      150                   658

Equity dividends paid                                (241)                    0

Net cash flow before financing                        198                 1,801

Financing
Issue of shares                                       200                   100
Purchase of own shares                               (205)                    0

Debt due beyond a year:
Capital element of hire purchase and
finance lease payments                               (589)                 (848)

Net cash outflow from financing                      (594)                 (748)

(Decrease)/Increase in net cash                      (396)                1,053



Notes to the cashflow statement:              31 January            31 January
                                                    2006                  2005
                                                   £'000                 £'000
1. Reconciliation of operating profit to net
cash inflow from operating activities

Operating profit                                   1,787                 2,670
Release of negative goodwill                           0                (1,080)
Depreciation charges                                 902                   847
Loss/(profit) on disposal of
fixed assets                                         (18)                    9
Increase in stocks                                  (236)                 (436)
Increase in debtors                                 (748)                 (496)
Increase in creditors                                243                   130
Exchange adjustments                                   0                     4
(Decrease)/increase in
provisions                                          (294)                  201
Cashflow from operating
activities                                         1,636                 1,849

2. Analysis of net funds/(debt)               1 February   Cashflow 31 January
                                                    2005                  2006
                                                   £'000      £'000      £'000

Cash at bank and in hand                           1,581        133      1,714
Bank overdrafts and invoice
discounting facilities                              (229)      (529)      (758)
                                                   1,352       (396)       956
Finance leases and hire purchase
contracts                                         (1,102)       589       (513)
Net funds                                            250        193        443

3. Reconciliation of net cashflow to movement   31 January          31 January
in net funds                                        2006                  2005
                                                   £'000                 £'000

(Decrease)/Increase in cash                         (396)                1,053
Cash outflow from decrease in
net debt and lease financing                         589                   848
Change in net funds resulting
from cashflows                                       193                 1,901
Opening net funds/(debt)                             250                (1,651)
Closing net funds                                    443                   250




Notes:


1.       Audited financial statements will be sent to shareholders towards the
end of June 2006. Copies of this announcement are available free of charge from
the Company's registered office at Alfreds Way, Barking, Essex IG11 0AZ for a
period of one month from the date hereof and copies of the audited financial
statements will be so available for at least 14 days from date of publication.


2.       The Company's financial statements for 2006, from which the figures
contained in this statement have been extracted, have not yet been reported on
by the Company's auditors or filed with the Registrar of Companies. The
financial statements for 2005, from which the figures contained in this
preliminary statement have been extracted, have been filed and contain an
unqualified audit report with no reference to section 237 of the Companies Act
1985.




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