Trading Statement

Dechra Pharmaceuticals PLC
15 January 2003

Issued by Citigate Dewe Rogerson Ltd, Birmingham
Date: Wednesday, 15 January 2003

                                                              Embargoed: 7.30am


                             Dechra Pharmaceuticals PLC
                                 Trading Update

As we indicated at our Annual General Meeting, during the first quarter of the
current financial year, National Veterinary Services ('NVS'), our principal
trading subsidiary, experienced growth within its business with sales up 11% on
the comparable quarter.  Towards the end of October 2002, we started to witness
a decline in market growth, with sales in November and December being flat on
the same period in the previous year.  The shortfall in sales at NVS, combined
with increased overheads due to expansion of the central warehousing facility, a
trebling of insurance premiums and an aggressive pricing environment have
impacted on net margins.  A number of actions have already been implemented to
recover the net margin across the business during the second half of this year.
NVS continues to trade with a market share in excess of 42%.

Additionally, the integration of Anglian Pharma into the Group's contract
manufacturing operation, although completed on schedule, has seen a delay in the
anticipated operating efficiencies resulting in production levels being below
our expectations. Management efforts are now focussed on the one site, and
operational efficiencies are expected to be realised during the second half of
the financial year. The order book remains strong at over £2 million, with new
contracts having been secured.

The remainder of the Group's businesses are continuing to develop in line with
our strategy.

Whilst it is difficult at this stage to predict the trading outcome for the year
as a whole, current indications are that the interim results for the six months
ended 31st December 2002 will be below that of the comparable period, however,
we expect to see an  improved trading performance in the second half.

The Group's clearly defined strategy remains fundamental to the medium to long
term development of our businesses. Key to this, is the strengthening of our own
veterinary licensed pharmaceutical product portfolio through Arnolds Veterinary
Products Ltd.  Both Vetoryl(R) and Felimazole(R), which were successfully
licensed in 2002, are performing to our expectations.  Sales and operating
profits at Arnolds remain in line with our budget, although R&D costs will more
than double in 2003 to in excess of £1 million.  This investment in new
pharmaceutical opportunities will result in additional licences within the year.

Our laboratories, North Western Laboratories Ltd and Cambridge Specialist
Laboratory Services Ltd, which were acquired in April 2002, are experiencing
strong growth and are expected to be earnings enhancing within this financial
year.

The added-value services, namely Vetcom(R) Windows and Vet2Pet(R) insurance
policies, provided through NVS to the veterinary practices continue to grow in
line with our plans.

The Competition Commission's final report in relation to their inquiry into the
supply of prescription-only veterinary medicines has been submitted to The
Secretary of State for Trade and Industry; at this stage, the document has not
been made public.  The Directors are confident that NVS remains in a strong
position to service and support the requirements of our existing and new
customers if and when change is implemented.


continued...


                                      -2-



It is the Board's intention to maintain the interim dividend at last year's
level of 1.37 pence, payable in April 2003.  As the Group continues to generate
cash and profits, the Board currently expect to recommend an appropriate final
dividend commensurate to earnings at the time of its preliminary results
announcement for the year ending 30th June 2003.

The Directors plan to update shareholders further at the time of the release of
its interim results on 4th March 2003.


Enquiries:
Ian Page, Chief Executive                            Fiona Tooley
Simon Evans, Group Finance Director                  Katie Dale
Dechra(R) Pharmaceuticals PLC                        Citigate Dewe Rogerson Ltd
Today: 020 7767 1000                                 Tel: [phone]
Thereafter: 01782 771100                             Mobile: [phone] (FMT)
Mobile: [phone] (IP)
Mobile: [phone] (SE)




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