Final Results

John Lewis Of Hungerford PLC
24 November 2004

John Lewis of Hungerford - Final Results


2004 Highlights

Sales decline 12.4% to £3,608,597 (2003 - £4,117,081).

Operating profit £28,675 (2003 - £406,706)

Net cash inflows from operating activities £15,003 (2003 - £635,096).

Cash balances at 31 August 2004 £373,676 (2003 - £937,571).

New "flagship" London showroom opened April 2004.

Company Profile

John Lewis of Hungerford plc ("the Company") designs, manufactures, and retails
kitchens and free standing furniture direct to the public from its own showrooms
and Company managed concessions throughout the United Kingdom.

In addition the Company operates a United Kingdom direct mail order business for
replacement kitchen cabinet doors and supplies wall panelling, shutters and
similar products to the interior designer market.

Manufacturing and administration is carried out from a purpose built factory at
Wantage, Oxfordshire constructed in 1998. The Company has recently made major
investments in advanced automated manufacturing equipment.

Founded in 1972, the Company is committed to the pursuit of excellence in every
aspect of its business and endeavours to maintain long-term relationships with
its staff, customers and suppliers. A policy of "keep it simple" links with an
innovative and fresh approach to its business. Significant United Kingdom brand
recognition has been achieved through long-term sustained advertising in quality
magazines.

The Company's core product line is the "Artisan" range of kitchens and
furniture. In recent years the Company has expanded its line of branded products
to include the more contemporary "Shaker" style kitchens and the "Just Doors"
direct mail business for replacement kitchen cabinet doors. In addition the
Company's "Architectural Components" division supplies panelling, shutters and
doors to the interior designer market.

The Company's growth strategy remains focused on improving the visibility and
availability of its products in the United Kingdom by increasing the number of
Company owned retail showrooms and selected concession sites, and by developing
its mail order businesses.

For more information about the Company and its products visit our web sites:

www.john-lewis.co.uk
www.the-home-office.co.uk
www.justdoors.co.uk


Overview

The financial results for the year under review are disappointing although the
Company has continued to make progress on a number of fronts.

A new "flagship" showroom was opened in Fulham, London in April 2004.

In September 2004, the Company's "Creme de la Creme" kitchen won a BIDA (British
Interior Design Association) award for outstanding design and best product at
the DECOREX 2004 exhibition in London.

The Company continues to develop its portfolio of brands offering quality
products at affordable prices which customers really want to have in their
homes.

The recent launch of "John Lewis of Hungerford Architectural Components" adds
shutters, panelling, and doors to the product line.

Also in Spring 2004 the Company launched a range of furniture for bathrooms and
a number of brand enhancing accessories such as fabrics, ceramics and similar
items.

During the year under review the Company acquired the trademark "Artisan"
broadly covering all furniture. The Company had previously used this under a
consent arrangement with the former owners of the mark.

Results

Sales for the year ended 31 August 2004 decreased by 12.4% to £3,608,597
compared to £4,117,081 for the previous year.

Profits before tax for the same period were £22,016 compared to £382,870 for the
previous year.

Gross margins increased to 62.8% against 60.5% in the prior year. The Company's
focus on margins has resulted in a 6.2% improvement over the two-year period to
31 August 2004.

Unit sales of kitchens declined by approximately 25% whereas furniture unit
sales were broadly flat (both compared to the prior year). Sales by the mail
order division "Just Doors" declined by 31% in a highly competitive market.

The profit for the financial year after taxation amounted to £10,519 (2003 -
£294,359).

Net cash outflows before financing were £546,214 (2003 - £399,583 inflows) and
reflects the high level of capital expenditures during the year.

Basic earnings per share were 0.01p (2003 - 0.20p).

No dividend is proposed for the year.

Trading review

The Company currently trades from 6 showrooms and 3 concession sites.

As indicated above, the financial results for the year have been disappointing.
This stems principally from a decline in the number of kitchens sold compared to
the prior year.

The reason for this decline is mainly difficulties encountered with the
recruitment and retention of designer staff for the Company's showrooms. As a
result a number of showrooms were inadequately staffed during part of the year
under review. The Company has taken a number of steps to address this issue and
at the date of this report all showrooms are adequately staffed.

A further factor negatively impacting sales has been the amount of management
time devoted to the building of the Company's new flagship showroom in London.
Whilst the direct supervision of this project by the Company has significantly
reduced the overall cost, it has diverted management effort from marketing and
sales activities.

In addition, the opening programme for the new showroom, whilst generating a
large amount of high profile editorial and other publicity for the Company, did
require a further significant commitment of management time.

As previously announced, the Company's very successful concession in Winchester
closed in July 2004 due to expansion requirements of the host store. The Company
has now secured a replacement showroom in Winchester, which is expected to open
in early Spring 2005.

In its Interim Statement, the Company indicated that the concession site at the
Hoopers department store Wilmslow, was to undergo a major refit in 2004. Due to
the priority of replacing the Winchester unit, this planned refit has been put
back to first half 2005.

Sales of "Just Doors" continue to be disappointing as a result of intense
competition at the lower end of the replacement kitchen door market. The Company
has recently repositioned "Just Doors" towards the upper end of the market with
an enlarged advertising campaign and new brochure. This change is already
beginning to show results.

During the year the Company augmented its management team with the appointment
of a highly experienced Operations Director (designate). It is expected that
this appointment will enhance operational efficiencies in the Company's factory
and further reduce the costs of production.

Financial review

The Company continues to maintain a cash generative business model with Net Cash
Inflows from Operating Activities amounting to £15,003 (2003 - £635,096). The
figure for the current year includes an exceptional increase in stocks which
reduced cash inflows as detailed below.

Stocks and Work in Progress at 31 August 2004 were £490,987 (2003 - £180,395).
This increase is made up of two factors. Firstly, a reclassification of showroom
display items from Tangible Fixed Assets to Stocks totalling £143,450 to comply
with current accounting standards. Secondly, an exceptional increase in
underlying work in progress inventories at 31 August 2004 amounting to £167,142.
The Company for the most part manufactures only to order and the majority of the
goods representing these inventories were shipped to customers early in the
following financial year.

Cash balances at 31 August 2004 totalled £373,676.

The Company has standby overdraft facilities of £250,000, which have recently
been renewed.

Capital expenditures (net) in the current year totalled £423,903. In the main
this reflects the fitting out costs of the new London showroom.

On the basis of the results for the year no dividend is being proposed.

Outlook

During the first months of the current year sales enquiries have increased
significantly on the back of a new advertising campaign and the very significant
publicity generated by the launch of the Company's new London showroom. However
actual order intake to date remains soft.

Whilst the Board believes the Company is well positioned in the market, at this
time the likely financial outcome for the current financial year remains
uncertain. Your Board does believe however that the necessary steps have been
taken to address the issues that resulted in the disappointing financial results
for the year to 31 August 2004.

John L Lewis
Chairman
24 November 2004

Profit and Loss Account for the year ended 31 August 2004

                                                          2004            2003
                                                             £               £

Turnover                                             3,608,597       4,117,081

Cost of sales                                       (1,341,659)     (1,625,831)
                                                   -----------     -----------

Gross profit                                         2,266,938       2,491,250

Distribution costs                                    (600,998)       (663,217)

Administrative expenses                             (1,637,265)     (1,421,327)
                                                   -----------     -----------
Operating profit                                        28,675         406,706

Exceptional expenses                                         -          (9,046)


Interest receivable and similar income                  14,498           7,903

Interest payable and similar charges                   (21,157)        (22,693)
                                                   -----------     -----------

Profit on ordinary activities before taxation           22,016         382,870

Tax on profit on ordinary activities                   (11,497)        (88,511)
                                                   -----------     -----------
Profit for the financial year                           10,519         294,359

Dividends                                                    -         (60,500)
                                                   -----------     -----------

Retained profit for the financial year                  10,519         233,859
                                                       =======         =======


Earnings per share

Basic                                                     0.01p           0.20p

Fully diluted                                             0.01p           0.20p

The profit and loss account has been prepared on the basis that all operations
are continuing operations.

There are no recognised gains and losses other than those passing through the
profit and loss account.

Balance Sheet as at 31 August 2004

                                                2004                       2003
                                     £             £               £          £

Fixed assets
Intangible assets                             34,077                     19,791
Tangible assets                            1,941,590                  1,886,216
                                          ----------                 ----------
                                           1,975,667                  1,906,007

Current assets
Stocks                         490,987                       180,395
Debtors                         86,243                        91,556
Cash at bank and in hand       373,676                       937,571
                            ----------                    ----------
                               950,906                     1,209,522

Creditors: amounts falling    (871,866)                   (1,077,507)
due within one year         ----------                    ----------

Net current assets                            79,040                    132,015
                                          ----------                 ----------

Total assets less                          2,054,707                  2,038,022
current liabilities

Creditors: amounts falling                  (344,028)                  (362,759)
due after more than one
year

Provisions for liabilities                   (70,566)                   (45,669)
and charges
                                         ----------                  ----------
Total net assets                           1,640,113                  1,629,594
                                             =======                    =======

Capital and reserves
Called up share capital                      148,745                    148,745
Share premium account                        824,771                    824,771
Other reserves                                 1,421                      1,421
Profit and loss account                      665,176                    654,657
                                          ----------                 ----------
Shareholders' funds                        1,640,113                  1,629,594
- all equity interests                       =======                    =======

The financial statements were approved by the Board on 24 November 2004.


John L. Lewis Richard D. Worthington F.C.A.
Director Director

Cash Flow Statement for the year ended 31 August 2004

                                                 2004                     2003
                                        £           £           £            £

Net cash inflow from                           15,003                  635,096
operating activities

Returns on investments
and servicing of finance
Interest received                  14,498                   7,903
Interest paid                     (21,157)                (22,693)
                                 --------                --------

Net cash outflow from returns on               (6,659)                 (14,790)
investments
and servicing of finance

Corporation tax                               (70,128)                       -

Capital expenditure
Payments to acquire               (17,590)                 (3,266)
intangible fixed assets

Payments to acquire              (414,942)               (177,639)
tangible fixed assets

Receipts from sales                 8,602                  15,182
of tangible fixed assets         --------               ---------

Net cash outflow from                        (423,930)                (165,723)
capital expenditure

Equity dividends paid                         (60,500)                 (55,000)
                                            ---------               ----------

Net cash (outflow)/inflow before             (546,214)                 399,583
financing

Financing
Repayment of Loan                 (17,681)                (18,341)
                                 --------               ---------

Net cash (outflow) from                       (17,681)                 (18,341)
financing
                                            ---------                ---------

(Decrease)/increase in cash                  (563,895)                 381,242
                                              =======                  =======


1.  Preliminary Results
    The preliminary results have been extracted from the Company's audited
    accounts which have been approved and signed by the directors and auditors,
    but have not yet been delivered to the Registrar of Companies. The audited
    accounts have been prepared under the historical cost convention using the
    accounting policies set out in the Company's 2004 statutory financial
    statements.

2.  Reconciliation of Movement in Shareholders' funds
                                                          2004            2003
                                                             £               £

    Profit for the financial year                       10,519         294,359
    Dividends                                                -         (60,500)
                                                    ----------     -----------

    Net addition to shareholders' funds                 10,519         233,859
    Opening shareholders' funds                      1,629,594       1,395,735
                                                   -----------    ------------
    Closing shareholders' funds                      1,640,113       1,629,594
                                                       =======        ========

3.  Earnings per Share

    Earnings per ordinary share is calculated as
    follows:
                                                          2004            2003
    Basic
    Profit attributable to ordinary                    £10,519        £294,359
    shareholders
    Weighted average number of ordinary shares in  148,745,519     148,745,519
    issue
    Earnings per ordinary share                           0.01p           0.20p
                                                      ========        ========
    Fully diluted
    Profit attributable to ordinary                    £10,519        £294,359
    shareholders
    Weighted average number of ordinary shares in  148,745,519     148,745,519
    issue
    Earnings per ordinary share                           0.01p           0.20p
                                                      ========        ========
    Weighted average number of ordinary shares in  148,745,519     148,745,519
    issue - basic calculation
    Number of shares deemed to have been issued              -               -
    for no consideration in respect of share
    options
                                                  ------------   -------------
    - fully diluted calculation                    148,745,519     148,745,519
                                                      ========        ========

4.  2004 Report and Accounts
    Copies of the 2004 report and accounts will be sent to shareholders in due
    course. Further copies will be available from the Company's nominated
    adviser, Smith & Williamson Corporate Finance Limited, No 1 Riding House
    Street, London, W1A 3AS, free of charge, for one month from the date of this
    announcement.

5.  Copy of Announcement
    A copy of this announcement will be available from the nominated adviser,
    Smith & Williamson Corporate Finance Limited, No 1 Riding House Street,
    London, W1A 3AS, for one month from the date of this announcement.

-ends-




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