Final Results

Feedback PLC
27 September 2007

                                  Feedback plc

         Preliminary Results for the 14 month period ended 31 May 2007



Chairman's and Chief Executive's Statement



The past few years have been very challenging for the Group. We have had to
adapt to changing market conditions in all the subsidiary businesses whilst
addressing legacy issues such as the pension deficit and operating in unsuitable
buildings in Crowborough. We are well advanced in finding permanent solutions to
all these difficulties and, although most of the considerable associated costs
have been borne during the period ending 31 May 2007, the benefits will become
apparent over the coming years. As part of the restructuring process the
financial year end was extended from 31 March to 31 May.



The attached results for the 14 month period to 31 May 2007 show an operating
profit of £325,600 on a turnover of £9,639,400 compared to £159,500 and
£7,638,600 respectively for the 12 months to 31 March 2006. This continues the
trend of improving profits at a trading level in recent years.



Exceptional costs associated with the solution to the pension situation, which
occurred after the end of this financial period, dilapidations on leased
buildings which have been vacated and restructuring amounted to £763,900 (2006 -
£nil) and costs associated with the pension fund, which was ongoing during the
period, interest and accrued dividends on the now fully converted Preference
Shares totalled £391,200 (2006 - £454,800). The loss before tax was £521,900
(2006 - £295,300).



As previously reported the main freehold premises in Park Road, Crowborough had
been sold subject to residential planning permission being granted for the site.
Three applications were rejected by the local authorities but, after going to
appeal, permission was granted for the development of the site in early February
2007. Alternative premises are being investigated with a view to relocating the
whole UK company.



All the fundamental difficulties the Group has experienced have been, or are
being addressed. This together with the improving trading performance and
reduced costs across the Group allow us to be more confident about the future
than we have been for some time.



Feedback Instruments Limited



There was another strong performance during the year from the largest of the
subsidiary companies. The strategic initiatives that have been referred to in
previous Statements; the introduction of new products, improved communications
with agents and reductions in costs are continuing to deliver results and helped
to increase turnover.



The overall export performance was significantly ahead of the previous year. In
particular there were continued strong sales in the Middle East and Far East and
a number of our international agents showed an improved commitment and produced
strong growth. Some agency arrangements were changed in territories where it was
felt performance should improve.



Funding within the Higher Education sector in the UK has been weak for a number
of years but the UK sales team, under their new manager, is producing very
encouraging results in this challenging market. Of particular note is the
success being achieved with the distributed line of science apparatus for
schools which is showing significant growth reflecting both the effort being
made and the relatively strong funding in this market sector.



In anticipation of the move to new premises two of the leased sites in
Crowborough were vacated and all personnel were relocated to Park Road. The
temporary loss of some of our metalworking capability, together with the
improved level of orders, necessitated the use of more subcontracting. Output
has been therefore somewhat restricted for a time.



In recent years the company has suffered from a lack of new products but a
number of items of equipment have been introduced recently as part of the
ongoing development strategy. Of particular note is a new range of Control
teaching systems which addresses the market sector in which Feedback started and
in which it established its reputation for quality and reliability. These new
products have been well received and will help the company restore its dominant
position in this market.



Feedback Data Limited



Feedback Data produces terminals for collecting data to improve efficiency and
security in the workplace. Although it operates in a very competitive market
turnover was up on the previous year. It was also encouraging to monitor the
improving sales of some of the newer products which had taken longer to gain
market acceptance than had been anticipated.



Strategic partnerships with new and established Value Added Resellers were
renegotiated which has resulted in stronger sales and less dependence on too few
channels to market. More emphasis has been put on obtaining end-user sales and a
number of niche markets were identified which are being investigated and are
already producing results.



A significant proportion of the company's revenue is derived from field support
of installed products. Turnover in this area has been maintained over recent
years and ways to increase efficiency and service are being considered.



A new data terminal, the TR1000 was developed to address the mid-range market
and to eventually replace the Kestrel and the new platform for the access
control market, Evolution, continues to be expanded.



Feedback Incorporated



After the disappointing performance in the preceding year the company returned
to profitability. The continuing weakness of the Dollar is however putting
pressure on margins and funding in the educational sector in the USA can be
uncertain.



The extra field sales personnel have started to contribute and the new products,
introduced over the previous 12 months, have been well received by the market.
To maintain this momentum a new marketing campaign has been initiated to
complement the direct sales effort.



The recent launch of the new range of Control experiments at the American
Control Conference in New York went very well. This is a market segment that
Feedback had dominated in North America and it is hoped that, with the
introduction of these new products, this position can be re-established.



Post Balance Sheet Events



Of most significance is the solution to the deficit in the defined benefit
Feedback Pension Scheme. This scheme was closed during 2004 but due the size of
the deficit, relative to Group turnover and profitability, the future viability
of the Group was seriously compromised. At the same time as the scheme was
closed an agreement was reached with Opra (Occupational Pensions Regulatory
Authority) to address the deficit over 15 years.

With the change in funding requirements brought in by The Pensions Regulator,
which succeeded Opra, and the adoption of FRS17 a different, permanent solution
was required.



After lengthy and complex negotiations with the Trustees of the scheme, The
Pensions Regulator and the Pension Protection Fund (PPF) an agreement was
reached whereby responsibility for the deficit was assumed by the PPF in return
for certain conditions being met. A formal Company Voluntary Arrangement (CVA)
was announced under which all  creditors other than the PPF were to be paid in
full. The Group would pay the PPF £1,200,000 (£700,000 from the proceeds of a
£1,400,000 placing and £500,000 after vacation of the Park Road premises) plus
provide shares totalling 18% of the enlarged share capital after restructuring.
The CVA and restructuring was agreed at meetings of shareholders and creditors
held on 2 July 2007.  The company will be formally released from the CVA once
the final £500,000 is paid to the Trustees.



The following proforma Balance Sheet is for illustrative purposes only. If the
changes to the pension scheme and the completion of the sale of the Park Road
premises had taken place on 31 May 2007 the table shows how the Balance Sheet
would have changed (the proforma Balance Sheet is unaudited and is not a
statutory Balance Sheet under S.240 of the Companies Act 1985).



CONSOLIDATED PRO FORMA BALANCE SHEET
                                                                         Actual              Proforma
                                                                         31 May               31 May
                                                                          2007                 2007
                                                                          £000                 £000
                                                                        (audited)          (unaudited)
Fixed assets
Tangible assets                                                                59.9                  59.9
Current assets
Stocks                                                                      1,179.5               1,179.5
Debtors                                                                     2,630.9               1,725.9
Cash at bank and in hand                                                      486.4               1,387.9

                                                                            4,296.8               4,293.3
Creditors: amounts falling due within one year
Borrowings                                                                  (414.8)               (414.8)
Other creditors                                                           (2,117.8)             (2,067.7)

                                                                          (2,532.6)             (2,482.5)

Net current assets                                                          1,764.2               1,810.8


Total assets less current liabilities                                       1,824.1               1,870.7

Creditors: amounts falling due after more than one year
Borrowings                                                                  (505.5)                     -

Net assets excluding pension liability                                      1,318.6               1,870.7

Pension liability                                                         (7,974.4)                     -

Net (liabilities)/assets including pension liability                      (6,655.8)               1,870.7



Finding the solution to this problem has been extremely time consuming and has
caused a significant diversion of management attention. We would like to thank
all the advisors who have worked tirelessly on our behalf.  For further
information please see note 8.



Current Trading & Future Prospects



The inflow of orders is satisfactory and the Order Book is healthy. However,
production bottlenecks, arising from the consolidation of all the UK companies'
operations onto one site at Park Road, ahead of moving to new premises, have
resulted in some delays in the dispatch of sales. These problems are being
actively addressed.  This has been a year of tremendous achievement and the
Board looks forward to the future with renewed confidence.


David Harding                                              David Sawyer
Chairman                                                   Chief Executive


26 September 2007


Enquiries:

David Sawyer                                          01892 653322
Feedback plc

Philip Davies                                         020 7149 6000
Charles Stanley & Co. Limited



CONSOLIDATED PROFIT AND LOSS ACCOUNT

for the 14 month period ended 31st May 2007




                                                                          Total                Total
                                                                           2007                 2006
                                                                           £000                 £000
                                                                      14 months

TURNOVER                                                                 9639.4               7638.6

Cost of Sales                                                          (5534.8)             (4255.9)

Gross profit                                                             4104.6               3382.7

Other Operating Expenses                                                 (3779)             (3223.2)


OPERATING PROFIT                                                          325.6                159.5
Profit on sale of fixed asset                                             307.6                    -
Exceptional reorganisation costs                                        (763.9)                    -

Net interest payable                                                    (143.2)              (148.8)
Other finance costs                                                       (248)                (306)


LOSS ON ORDINARY
ACTIVITIES BEFORE TAXATION                                              (521.9)              (295.3)

Tax on loss on ordinary activities                                            -                    -


RETAINED LOSS AFTER TAXATION                                            (521.9)              (295.3)


LOSS PER SHARE (pence)

Basic                                                                    (3.34)                (2.4)
Diluted                                                                  (3.34)                (2.4)

The results for 2007 relate to continuing operations.






CONSOLIDATED BALANCE SHEET AT 31st MAY 2007


                                                              2007          2007             2006          2006
                                                              £000          £000             £000          £000
Fixed assets
Tangible assets                                                             59.9                          714.9

Current assets
Stocks                                                      1179.5                         1000.3
Debtors                                                     2630.9                         1616.3
Cash at bank and in hand                                     486.4                          805.7

                                                            4296.8                         3422.3

Creditors: amounts falling due within one year
Borrowings                                                 (414.8)                       (1132.1)
Other creditors                                           (2117.8)                       (1447.4)

                                                          (2532.6)                       (2579.5)

Net current assets                                                        1764.2                          842.8


Total assets less current liabilities                                     1824.1                         1557.7

Creditors: amounts falling due after more than one
year:
Borrowings                                                               (505.5)                          (579)

Net assets excluding pension liability                                    1318.6                          978.7

Pension liability                                                       (7974.4)                         (8233)

Net liabilities including pension liability                             (6655.8)                       (7254.3)


Capital and reserves
Called up share capital                                                   1761.2                         1234.5
Share premium account                                        936.6                          409.9
Revaluation reserve                                              -                          595.6
Capital reserve                                              299.9                          299.9
Profit and loss account                                   (9653.5)                       (9794.2)

Total reserves                                                            (8417)                       (8488.8)

Deficiency of shareholders' funds - equity                              (6655.8)                       (7254.3)
interest







CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES


                                                                                    Group
                                                                                   2007         2006
                                                                                   £000         £000
                                                                              14 months

Loss for the financial period                                                   (521.9)      (295.3)
Unrealised surplus on revaluation of land and buildings                               -        223.2
Currency translation differences on foreign currency
net investments                                                                    22.9         86.5
Actual return less expected return  on pension scheme assets                    (265.0)      1,315.0
Experience gains and losses arising on liabilities                                    -        596.0
Changes in the assumptions underlying the present value of the
scheme liabilities                                                                285.0    (2,068.0)

Total losses relating to the period                                             (479.0)      (142.6)






CONSOLIDATED CASH FLOW STATEMENT


                                                              2007         2007               2006           2006
                                                              £000         £000               £000           £000
                                                         14 months

Net cash (outflow) / inflow from operating activities                   (527.2)                              62.7


Returns on investments and servicing of finance
Finance lease interest paid                                    (1)                               -
Interest paid                                               (49.9)                          (47.8)
Interest received                                              3.7                               -

Net cash outflow from returns on
investments and servicing of finance                                     (47.2)                            (47.8)

Capital expenditure and financial investment
Purchase of tangible fixed assets                           (32.2)                            (26)
Sale of tangible fixed assets                                   50                               -


Net cash inflow / (outflow) from capital expenditure                       17.8                              (26)
and financial investments


Financing
Repayments of bank and other loans                          (32.5)                            (30)
Capital element of finance leases and rental payments        (8.1)                               -

                                                                         (40.6)                              (30)
Net cash outflow from financing

Decrease in cash in the year                                            (597.2)                            (41.1)







Notes



Note 1:



The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in section 240 of the Companies Act
1985 nor the Group's statutory accounts for the period ended 31 May 2007 or the
year ended 31 March 2006.



The financial information for the year ended 31 March 2006 is extracted from the
Group's financial statements to that date which received an unqualified
auditor's report and have been filed with the registrar of companies. The
financial information for the period ended 31 May 2007 is extracted from the
Group's financial statements to that date which received an unqualified
auditor's report and will be filed with the registrar of companies. The
auditor's report did not contain a statement under section 237(2) or (3) of the
Companies Act 1985 in either period. The auditor's report for the period ended
31 May 2007 includes an emphasis of matter paragraph describing a material
uncertainty concerning  the impact of the post balance sheet Company Voluntary
Arrangement and restructuring which may cast significant doubt about the ability
of the Group to continue as a going concern.  This is further described in Notes
3 and 8.  The financial information does not include the adjustments that would
result if the Group was unable to continue as a going concern.



Note 2:



The financial information is prepared in accordance with the historical cost
convention as modified by the revaluation of the freehold property (disposed of
during the period) and in accordance with applicable accounting standards,
except in the case of FRS 17, as described in Note 4.



The Group changed its Accounting Reference Date from 31 March to 31 May, with
effect from 31 May 2007.  Therefore the financial information presented is for
the fourteen month period from 1 April 2006 to 31 May 2007.  The comparatives
for the previous year are for the twelve month period 1 April 2005 to 31 March
2006.



Note 3:



At the Extraordinary General Meeting held on 2 July 2007, the proposal for
resolving the pension deficit was adopted by the shareholders and consequently
the Group entered a Company Voluntary Arrangement  (CVA).  At the date of
approval of the accounts, the CVA has not been completed.  The final requirement
is to remit to the Pension Protection Fund the amount of £500,000 on completion
of the sale of the Park Road site.  The Directors are not aware of any matters
which are likely to prevent the successful conclusion of the CVA, and therefore
have prepared the accounts on a going concern basis.



Note 4:



As part of the CVA negotiations, an actuarial valuation of the defined benefit
pension scheme was carried out as at 28 February 2007, and this formed the basis
for computing the deficit.  Consequently the Directors have used this valuation,
amended to reflect payments made between 28 February and 31 May 2007, as
representing the liability in the balance sheets of the Group.  This represents
a departure from Financial Reporting Standard 17 'Retirement Benefits' but the
Directors believe that this gives a true valuation of the liability at the
balance sheet date.



Note 5:



The Report and Accounts will be posted to shareholders by 28 September 2007 and
the Annual General Meeting will be held at 11.00am on 30 October 2007. Statutory
financial statements will be filed with the Registrar of Companies following the
Annual General Meeting.






Note 6:



This preliminary announcement was approved by the Board and authorised for issue
on 27 September 2007.



Note 7:



Loss per share

Basic loss per share for the period ended 31 May 2007 is based on the Group loss
on ordinary activities after taxation of £521,900 (2006 loss of £295,300)
attributed to 15,623,305 Ordinary Shares, being the weighted average number of
shares in issue throughout the period (2006 - 12,319,645).



Note 8:



Post Balance Sheet Events



a) Agreement with the Pension Protection Fund (PPF) and Company Voluntary
Arrangement (CVA)

On 2 July 2007, the Company and its trading subsidiaries, Feedback Instruments
Limited (FIL) and Feedback Data Limited (FDL) entered into a Company Voluntary
Arrangement with its creditors under which all external creditors will be paid
in full save for:



(i)   the liability to the Trustees of the Feedback Pension Scheme and

(ii)   the liability to Mr T.W.G. Charlton in respect of the loan made by him to
the Company.



In connection with the CVA, the Company announced a Proposed Share Capital
Reorganisation and Reduction of Capital and Placing of 46,666,667 New Ordinary
Shares of 3 pence per share. The Company, together with FIL and FDL, agreed
terms with the Board of the PPF whereby the Company:



(i)   is required to pay the net sum of £1,200,000 in cash to the Trustees of
the Feedback Pension Scheme, £700,000 of which is to be paid from the proceeds
of the Placing and £500,000 of which is to be paid from the proceeds of the sale
of the Company's freehold premises at Park Road, Crowborough and

(ii)   allocates to the Trustees of the Feedback Pension Scheme such number of
New Ordinary Shares as equal 18% of the enlarged share capital of the Company.



At the date of this financial information, £700,000 has been paid to the
Trustees from the

proceeds of the Placing. The Company is in ongoing negotiations for the
relocation from its Park Road site, and the final amount of £500,000 due will be
paid upon completion of the contract for sale.



In addition, the Company agreed with Mr Charlton that the loan of $1,000,000
provided by him would be written down by 80% and the balance to be satisfied by
the allotment of 3,355,141 New Ordinary Shares at the Placing price.



b) Placing of 46,666,667 New Ordinary Shares at 3 pence per share

The Placing, which was successfully completed on 3 July 2007, raised £1,400,000
before expenses. These shares, which represented 56.58% of the total issued
share capital of the Company following the proposals were admitted to the
Alternative Investment Market on 3 July 2007. Certain of the Group's directors
agreed to participate in the Placing. Of the Company's directors, Messrs. Sawyer
and Bushell agreed to acquire 500,000 shares and 250,000 shares respectively and
Mrs H. Westcott, spouse of Professor J.H. Westcott, agreed to acquire 3,333,333
shares.




c) Share Capital Reorganisation

At an Extraordinary General Meeting of the Company and separate Shareholder
Meetings held on 2 July 2007, it was resolved that:



(i)   each of the existing 17,611,841 issued Ordinary Shares of 10 pence in the
capital of the Company would be subdivided in one New Ordinary Share of 0.25
pence and one Deferred Share of 9.75pence;

(ii)   the remaining authorised but unissued Ordinary Shares of 10 pence each be
subdivided into 40 New Ordinary Shares of 0.25 pence each;

(iii)  subject to the approval of the Court, the Company's Share Premium Account
be cancelled;

(iv)  the ordinary share capital of the Company be reduced from £3,000,000
divided into 513,138,201 New Ordinary Shares of 0.25 pence and 17,611,841
Deferred Shares of 9.75 pence each to £1,282,845.5025 divided into 513,138,201
New Ordinary Shares of 0.25 pence each and such reduction be effected by
cancelling and extinguishing altogether the 17,611,841 Deferred Shares of 9.75
pence each.



Application has been made to the Court for the hearing of the Company's
petition, and this is provisionally

scheduled to take place in November 2007.



d) Pro Forma Balance Sheet

A pro forma balance sheet, for illustrative purposes only, has been included
within the Chairman's and Chief Executive's Statement.








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