Final Results

Kingspan Group PLC
11 March 2003

KINGSPAN GROUP PLC

RESULTS FOR THE YEAR ENDED 31 DECEMBER 2002



FINANCIAL HIGHLIGHTS


                                                               2002                2001             % Change

Turnover                                                      €739.6m             €828.9m             -11%

Operating profit                                              €73.1m              €88.6m              -17%

Operating profit before goodwill amortisation                 €82.0m              €97.2m              -16%

Net profit before tax                                         €63.7m              €73.4m              -13%

Basic earnings per share                                       30.2c               32.9c               -8%


Adjusted earnings per share (before goodwill                   35.5c               37.9c               -6%
amortisation)


Regular dividend per share for the year                        5.9c                4.7c               +26%

Dividend cover-before amortisation                          6.1 times           8.0 times

Interest cover                                              8.8 times          6.4 times

Gearing ratio (net debt as % of shareholders' funds)            50%                 73%


Special dividend per share                                     12.0c                Nil




CHAIRMAN'S STATEMENT



Turnover for the year ended 31 December 2002 was €740 million, down 11% compared
to the previous year.    Profits before tax were €63.7 million (2001: €73.4
million).    Earnings attributable to ordinary shareholders were €50.5 million
(2001: €55.4 million).    Cash generation remained strong with earnings before
interest, tax, depreciation and amortisation (EBITDA) of €103.2 million.



Dividends



Net debt at year end was €117 million a reduction of €52 million from €169 at 31
December 2001.   This was achieved after capital investment during the year of
€30 million.    Debt has been significantly reduced over the past two years so
that balance sheet gearing (net debt as a percentage of shareholder funds) at
year end was 50%.    With this in mind a final dividend of 3.8 cent per share is
proposed giving a total dividend for the year of 5.9 cent.    This is an
increase of 26% over 2001.    The company also intends paying a special once off
dividend of 12.0 cent per share in 2003 as a method of paying the shareholders
some of the cash generated over the past 2 years.    While the Group has adopted
a progressive dividend policy over the past three years and the dividend has
been increased over that time by an annual 27.7%, dividend cover 2002: 6.1 times
(2001: 8.0 times) has been maintained at a level considerably higher than that
of comparable companies.   We intend to increase dividends progressively over
the next three years in a manner compatible with the growth plans set out later
in this statement, so as to bring dividend cover down to a level closer to
industry norms.



Share Buyback



The company purchased and cancelled 3.9 million of its own shares during 2002.
Permission will be sought from shareholders at the same time as the 2003 Annual
General Meeting to buy back up to 10% of its own shares.  This will be the
subject of a circular which will be sent to shareholders with the notice
convening that meeting.



Market Conditions



Kingspan products are in the main directed at industrial, commercial and
domestic building projects.    These are markets which are driven by the level
of confidence of decision makers in global as well as local economies.    It is
an understatement to say that there is uncertainty in global economies at
present.  Kingspan has not been immune from the effects of this global
uncertainty.    The comparison on a year on year basis shows a decline in
Kingspan sales of €89 million or 11%, which is attributed in the main to the
commercial sector - raised access floors in the UK and US high-rise office
buildings.  The remaining product groups achieved a creditable performance
against a background of construction markets which showed substantial declines
in 2002.



Insulated panels sales were down 3% in 2002 which was a good performance given
that there were very sharp declines in the overall cladding markets in all of
the Western European countries in which Kingspan operates, namely Ireland, the
UK, Holland, Belgium and Germany.  This demonstrates the resilience of the
unique range of products which Kingspan continues to develop for its target
markets.  Central Europe performed better than the previous year with Kingspan
increasing its sales by 10%.



Raised access floors had a difficult year in 2002 with sales down 36% or €92
million.    The commercial office new build market was down 25% in the UK and
30% in the US for the second year in a row.   There has been a substantial
increase in unlet office space in both markets.    In this environment,  the
Group moved to reduce overheads and at the same time continued its strategy of
market conversion and geographic spread.



Insulation products, which are targeted at a range of applications, showed an
increase of 25% over 2001.    Demand in the domestic housing sector was buoyant
in both the Irish and the UK markets.   Kingspan also increased its share of the
market driven by the efficiency and thermal qualities of its products.    In
June, Kingspan acquired the phenolic board insulation business of Marec from
Morgan Crucible plc.    This acquisition added sales of €6 million in the year.
Based in Holland, this acquisition gives Kingspan the opportunity of growing
sales in mainland Europe.



Environmental containers showed growth in the year in its Irish, the UK and
European markets.    The recently established manufacturing plant in Poland has
gone through its break-even point and its products have been certified for their
particular applications in Southern European, Scandinavian as well as Central
European markets.    The market for pollution control and waste management
products remained buoyant, driven by environmental legislation, regulation and
best practice.



As we highlighted in the past, sales of the Kingspan range of building
components are dependent on the macro environment in the structural steel
sector. Sales of these products declined by 15% in the year in line with that
sector.



Kingspan delivered a very creditable return on capital employed in the year of
20.6%, despite the fact that during the year some of the markets in which we
operate were difficult.   This was achieved by moving at pace and with agility
to offset the impact of these difficult conditions and still create growth
opportunities for the future. During the year, major cost reduction programmes
were undertaken in our raised access floor businesses to resize them to the new
market conditions. In both the US and the UK the cost bases were reduced by over
30%.     In addition, Kingspan invested across its manufacturing facilities to
gain efficiencies and greater economies of scale.    Kingspan also changed its
business approach towards its raised access flooring business from a basic
product led sale to one which is specification and buildings solutions led.
There are encouraging signs from this initiative.   Kingspan has continued to
drive market conversion in insulated panels and new geographic markets in
Central and Eastern Europe were developed. Ten new products were launched across
the Group which will form a substantial part of Kingspan's growth platform for
the future.



The Business going forward



All the Kingspan product groups are capable of substantial growth and of
delivering a high return on capital employed.



Insulated Panels



Kingspan is one of the most prominent producers of insulated panels in the
world.  There is a world-wide demand for its product because Kingspan is, as far
as we are aware, the only insurer approved insulated foam cored panel
manufacturer.  It's 'Firesafe' cladding envelope solutions are recommended by
insurance companies in places as far away as Australia and China.  Currently,
penetration of the available UK market by insulated panels stands at about 45%
which has doubled over the past 5 years.     A key element of Kingspan strategy
in the UK over the next 5 years is to increase this penetration level to
approximately 70%.    Kingspan is confident that through its 'Firesafe'
insulated panels, acknowledged by insurers and driven by stringent building
regulations and health & safety regulations this will be achieved.    In
addition, Kingspan recently launched new insulated panel products into new
market sectors.   These are now gathering momentum with the objective of
establishing them as mainstream products.



Central Europe is a growth area for Kingspan products.  Countries in this region
are attracting significant inward and infrastructural investment which is
expected to accelerate as these countries join the EU.     Kingspan is now
taking steps to ensure that we will be the leading brand in this region with
market shares equivalent to those achieved in its other markets.



Markets in Western Europe are likely to remain indifferent over the next couple
of years and the launch of a significant new product by Kingspan is likely to be
required to stimulate sales for the Group.



The acceptability of Kingspan 'Firesafe' panels on a world wide basis has led to
the investigation of a number of geographical markets.  We intend to install one
new plant per year over the next five years in markets where we can capitalise
over competitor products.



The investment required to exploit these opportunities in insulated panels over
the coming five or six years will be in the order of €100 million.





Raised Access Floors



I have referred above to the difficulties currently being experienced in the UK
and US markets for this product group.



The benefits of raised access floors are compelling.  Kingspan has developed an
interactive cost model which enables constructors , developers and building
owners to input specifications online using access floors and underfloor air and
calculate first build costs using this type of construction and compare it with
 traditional building methods.    This consistently demonstrates that on average
a saving of 5% on first build costs can be achieved.



Kingspan is the largest supplier of raised access floors in the US where the
penetration of the market is only about 10%.    The strategy and challenge for
Kingspan is to increase this penetration substantially.



In Europe, Kingspan is taking steps to be less reliant on the UK market where it
is also a substantial market leader.  With this in mind we are targeting 10
regional markets on a comprehensive basis.



Capital investment to deliver on this strategy will be relatively small as
adequate manufacturing capacity is already in place.  In the meantime steps have
been taken to reduce the breakeven level of sales in the US to $60 million and
to €75 million in Europe.





Insulation Products



Kingspan is the primary supplier of rigid insulation boards in the UK and Irish
markets for many applications such as pitched roof, flat roof, cavity wall and
under-floor for the domestic housing and commercial construction markets.  The
Group continues to make substantial investment in the Kingspan brands for these
applications and we expect this to be reflected in further increases in demand.
This increased demand is making it necessary to add substantial capacity at its
Irish, the UK and Dutch plants.   It is anticipated that further investment in
new production lines will be necessary over the next 5 years.



The acquisition of the business in Holland referred to above, has provided
Kingspan with an additional unique technology for the manufacture of rigid
boards.  This combined with existing Kingspan technology makes Kingspan the
leading producer of phenolic insulation boards in the world.  Under the Kingspan
brand, we expect these products to show significant growth in target niche
markets in the short to medium term.



Continuing investment in the automation of insulated pipe sections, targeted at
the HVAC industry, will facilitate increasing market share in this sector, given
the advantage of the Kingspan product range over fibrous pipe insulation.



The Tekhaus system of structural insulated panels, which has applications in
house construction, holiday complexes and as infill panels in the construction
of hospitals, schools, student accommodation, hotels and institutional type
buildings is expected to get through its break even level in 2003.  We expect to
achieve good growth for the Tekhaus system through partnership arrangements in
all of our markets on the back of strong specifications.



Given the various developments, the outlook for the Group's insulation products
look favourable in the medium term.



Environmental Containers



Kingspan has a multi-product range under its environmental containers banner,
many of which have benefited from environmental legislation.  With continuing
emphasis on environmental issues further regulation opportunities are expected.




Improved waste management practice continues to drive demand for the pollution
control products in this business.  The market leadership by Kingspan in these
products is linked to its relationship with the distribution channels.
Kingspan had focused on the UK and Irish markets until recently.  We have now
identified other markets which will be supplied mainly from our newest Polish
facility.  Indications are that these new markets will become increasingly
profitable in 2003 and thereafter.






Building Components



Kingspan recognises the problem in achieving growth in these products, targeted
as they are at the structural steel sector.   The Government sponsored Private
Finance Initiative, the biggest public construction programme since Victorian
times, is currently underway in the UK with Stg£2 billion scheduled for
investment each year for the coming 10 years.  Kingspan is currently in the
process of developing and refining its product range in this area, so that they
can be used separately and more importantly, collectively with other Kingspan
products, on these types of projects.  The vast majority of these schemes will
need to be factory assembled to achieve the building programme set by the UK
government.  Kingspan intends to ensure that its product offerings will provide
the most appropriate solutions for these volumetric design projects.





Outlook



As is well documented, the current macro environment which is characterised by
uncertainty is unlikely to show any improvements over 2002.    However the Group
has a product mix not entirely dependent on the macro environment and also has
geographic opportunities which support sales going forward.    This combination,
together with tight cost management, should continue to insulate the Group
against the worst effects of the global downturn.    Kingspan remains committed
to our goals of high Return on Capital Employed, strong cash flow generation and
organic growth.







FINANCIAL REVIEW



Operating Review



Sales for 2002 at €739.6 million were €89.3million or 11% lower than 2001.
Acquisitions in the year generated €8.1million additional sales and foreign
exchange translation resulted in an €8.0 million decrease versus 2001.



Operating profits before goodwill at €82.0 million, decreased by €15.2 million
or 16% compared to 2001. Goodwill amortisation increased by 4% from 2001 to €8.9
million. Net interest and corporate tax charges reduced by €5.9 million and €4.7
million respectively. The combination of these decreased charges limited the
decrease in earnings to 9%. This compares to a 6% decrease in adjusted EPS
reflecting the buyback of shares in the year. Free cash flow per share decreased
29% to 48.6 cent per share (2001: 69.0 cent per share).



A total of €7.7 million was invested in acquisitions in the year. These
acquisitions generated operating profits, net of goodwill, of €0.2 million in
the year on sales of €8.1 million.



Sales and Margins



Group Sales decreased by 11% or €89.3 million compared to 2001. Insulation and
Environmental Containers increased by 25% and 2% respectively adding €27.3
million to Group Sales. Raised Access Flooring, Components and Insulated Panels
sales fell 36%, 15% and 3% respectively reducing Group sales by €116.6 million.



On a geographical basis, sales in Britain & Northern Ireland, representing 64%
of Group turnover in 2002, fell by 4% to €475.5 million. Sales in the Republic
of Ireland fell by 14% to €94.2 million and Mainland Europe sales were up 4% to
€98.2 million.


TURNOVER

                                                                               €'000            €'000

                                                                                2002             2001
The analysis by class of activity is as follows:

Insulated panels                                                             240,240          248,011
Raised access flooring                                                       160,716          252,455
Insulation boards                                                            123,170           98,306
Environmental containers                                                     118,610          116,147
Building components                                                           96,874          114,028
                                                                             739,610          828,947

The analysis by geographical area is as follows:

Republic of Ireland                                                           94,179          108,919
Britain and Northern Ireland                                                 475,542          493,764
Mainland Europe                                                               98,225           94,126
United States of America                                                      49,006          109,221
Other                                                                         22,658           22,917
                                                                             739,610          828,947
                                                                              
At the gross profit level average margins increased to 30.3% compared to 28.9%
in 2001. This is due to a higher margin product mix and a reduction in the lower
margin Tate business in 2002.  Operating profit before goodwill amortisation
decreased to €82.0 million or 11.1% of sales (2001: 11.7%). This is due to the
reduction in the leverage of the business on its fixed cost base.



Taxation



The effect of an overprovision adjustment in the year of €2 million reduced the
Group's effective tax rate calculated before goodwill amortisation to 18.3% in
2002 (2001: 21.9%). Excluding the effect of this adjustment, the underlying tax
rate was 20.9%.



Earnings per share



Earnings per share at 30.2 cent shows a decrease of 8.2% over the previous year.
Adjusted Earnings per share at 35.5 cent shows a decrease of 6.3% over the
previous year. Adjusted Earnings per share has grown at an annual compound rate
of 12.6% over the period 1998 to 2002.



Dividends



The regular dividend per share for 2002 is proposed at 5.90 cent. This comprises
an interim dividend of 2.10 cent per share paid on 11th October 2002, and a
final dividend of 3.80 cent proposed to be paid to shareholders on the register
on 21 March 2003. This represents an increase of 25.5% on the previous year. The
regular dividend for the year is covered 6.1 times by adjusted earnings compared
to 8.0 times in 2001.  The Group has continued to implement the policy of
bringing its dividend yield more closely in line with comparable quoted
companies. As a result, the regular dividend per share has grown at an annual
compound rate of 27.7% over the period 2000 through to 2002. The Industry
average for dividend cover is 4 to 4.5 times and the Group intends to
progressively increase its dividend payout to bring dividend cover down to this
average.



A special dividend of 12.0 cent per share is proposed to be paid mid-year to
shareholders on the register on 21 March 2003. This payment increases the
efficiency of the balance sheet for the benefit of shareholders and gearing
after such payment increases to 58%.



Funds flow



The table below summarises the Group's funds flow for 2002 and 2001:

Cash flow
                                         €m            €m
                                        2002         2001

                                        
Inflows
Profit before taxation                  63.7         73.4
Depreciation                            21.2         22.2
Amortisation                             9.4          9.0
Disposals                                0.7          0.0
Share issues in Company                  1.1          0.5
                                        96.1        105.1
                                      
Outflows
Acquisitions                             7.7        120.4
Purchase of Treasury shares              8.0          4.0
Capital Expenditure                     30.0         33.7
Dividends paid                           8.5          6.8
Taxation paid                           10.7         16.3
Dividends to minorities                  0.0          1.6
Working capital increase                 1.7       (26.9)
Other                                  (22.9)         9.0
                                        43.7        164.9
Decrease/(increase) in net debt         52.4       (59.8)
                                      
Net debt at start of year             (169.7)     (109.9)

Net debt at end of year               (117.3)     (169.7)

                                      

                                      



The acquisitions during the year were financed out of Group's resources. Debt
reduction before acquisitions, purchase of treasury shares and non-cash
translation effects was €44.6 million (2001: €73.6 million.)



Foreign exchange translation effects reduced debt by €23.1 million in the year.
The US Dollar devalued 18.3% versus the Euro from beginning to end of year. This
resulted in a €20.0 million reduction on the Group's US Dollar debt which has
been adjusted through reserves.



The free cash flow for the year, comprising operating cash flow less interest
and taxation paid, amounted to €81.3 million, a decrease of 30% compared to
€115.2 million in 2001. This performance represents 48.6 cent per share (2001:
68.3 cent). Over the two years 2001 and 2002 a total of €196.5 million in free
cash was generated of which €106.9 million was invested in acquisitions and
€65.8 million in capital expenditure.



Working capital, comprising stocks, debtors and creditors represented 13.9% of
sales in 2002 (2001: 12.6%).



Return on capital employed



The return on capital employed, being profit before interest and taxation, at
year end was 20.6% compared to 22.1% in 2001.  The reduction reflects the
challenging trading conditions experienced during 2002. If goodwill previously
written off of €60.9 million (2001: €52 million) was still on the balance sheet,
the return on the year end capital employed, being profit before interest,
taxation and goodwill amortisation, would have been 19.7% compared to 21.4% in
2001.



Treasury



Net interest charge amounts to €9.4 million and is covered 8.8 times (2001: 6.4
times) by adjusted earnings and 11.0 times by earnings before interest, tax,
depreciation and amortisation (2001: 7.8 times).  Net year end borrowings
amounted to €117.3 million representing gearing of 50% compared to 73% in 2001.



It is Group policy to enter into interest rate hedging to limit interest rate
exposure on a proportion of the Group's medium to long term debt. Term loans of
€182.2 million at 31 December 2002 are comprised of €114.5 million US Dollar
debt and €67.7 million Sterling debt.  Of these borrowings, approximately 50%
are subject to interest rate hedges which limit the US Dollar exposure to
between 4.3% and 6.5% and limit the Sterling rate exposure to between 6.2% and
8.0%. The Sterling hedge expires May 2003 and the US Dollar hedges expire June
2004. Balance sheet exposure in relation to foreign currency is hedged as far as
possible by borrowings in the same currency. Foreign exchange translation and
transaction exposures are hedged internally as far as possible and to the extent
that they are not, such exposures are hedged up to one year forward.



Summary



Despite the difficult business environment in 2002 adversely impacting Group
turnover and operating results, the Group has continued to deliver a strong
level of free cash flow and is supported by comfortable interest and dividend
cover. The strength of the balance sheet and cash generation has prompted the
proposal of a special dividend to be paid in 2003. After the payment of this
dividend, the balance sheet will remain strong with ample capacity to fund
ongoing investment in the business and any opportunities that may arise. The key
financial objectives remain to deliver superior returns on capital employed and
strong cash flow. This will be achieved through tight control of costs, tight
management of working capital and stringent payback criteria on investment in
the organic development of the business.







OPERATIONS REVIEW



The Group is focused on driving strategies to deliver high market shares in our
chosen markets. Across the Group, proven management teams consistently seek to
deliver the strategies by:



•      Driving value improvement and cost reductions relentlessly.

•      Managing changing market circumstances quickly and with agility.

•      Innovating new products and solutions.

•      Seeking and developing new geographic markets and market segments.



All these attributes, which were used extensively to deliver the results in
2002, offset some of the cyclical effects of the current global economy and
created a growth platform for the future.



The Group invested €30 million in capital expenditure to develop new markets and
products and to drive value improvements.



In relation to new products generally, 2002 was characterised by installing new
production facilities, getting the necessary regulatory approvals, establishing
new trade relationships and launching the products in a controlled manner. We
are satisfied with progress overall. The single biggest issue was that the large
number of new products from Kingspan created a backlog in the independent test
facilities used by the regulators. This in turn delayed the issuing of approval
certificates in some instances. The way is now clear for the recently launched
products to make a more significant contribution going forward.



Insulated Panels



Our insulated panel facility in Czech was extended and up rated to support
developing new markets for Kingspan insulated panels in Central and Eastern
Europe. Efficiency improvements of over 20% have been achieved by a combination
of higher line speeds, reduced changeover times and reduced waste.



Architects and investors are continually looking for 'signature' features for
their buildings. Kingspan has a history of leading innovation in creating new
panel designs with distinctive 'signature' features which can be used
individually or in combination. This year we introduced a range of new designs.



A high specification panel, Optimo(R) - which gives an attractive look to a
building was launched in the UK and Ireland. Customer response has been most
encouraging.



This year Kingspan also successfully launched insulated panel solutions into two
new market segments. Kingspan's range of cold store panels has been launched
into the significant chilled and cold store market in the UK and Ireland.
Kingspan has also developed an insulated roof tile solution which gives
customers all the aesthetics of a traditional roof tile but with all the
insulation and quick build benefits of a factory finished insulated panel. We
have invested substantially in new product processing and handling facilities at
our Sherburn facility to support these new products. We believe that we are the
first insulated panel company in Europe to develop a continuous process for
making insulated roof tiles.



Topdek(R), Kingspan's new insulated panel for flat roof applications had a
satisfactory first year in the market. New alliances were formed with a range of
trade partners. Sales in the middle of the year were affected by delays in the
regulatory test house in the UK but this has now been resolved. Topdek(R) was
launched in Ireland in late 2002.



Insulation Products



Our insulation businesses in Ireland, the UK and Northwest Europe had a good
year. Sales growth was driven by a combination of early adoption of the new
building regulations in the UK, especially in the refurbishment market and the
innovative development of insulation solutions for a range of new market
segments.



Tekhaus, our new structural insulated panel, received all the necessary building
regulation approvals in the UK and Ireland. A range of high profile projects
were completed successfully with leading brand name customers.



During the year, Kingspan strengthened its international position in the premium
phenolic insulation market. Marec, a Dutch producer, was acquired from Morgan
Crucible plc. In addition, a new state-of-the-art large scale phenolic
manufacturing line was commissioned in our Pembridge facility to reduce unit
costs and increase capacity significantly. Line speeds were increased by over
50% and waste considerably reduced. The original pilot-scale phenolic facility
in Barry, South Wales, which had a high cost base, was closed.



A major investment was made in speeding up product processing, handling and
packaging at both our Pembridge and Castleblaney facilities. New high speed
conveyors, saws and packaging equipment were installed. Line speeds have
increased as planned and have doubled for some products.





Building Components



Sales were down 15% reflecting the slowdown of the market overall in Ireland and
the UK. Progress was made in developing quick build concepts for a range of
market needs.



Raised Access Floors



This was a difficult year in both the US and the UK markets. In both markets,
the commercial office new build was down substantially with an amount of unlet
office space overhanging the market. Kingspan moved with pace and agility to
reduce direct and indirect costs and resize the businesses to the new market
conditions. As examples, in the US, the breakeven point of the business was
reduced by over 30% and in the UK headcount was reduced by over 35%. These
substantial reductions were achieved by a combination of reducing direct and
indirect headcount, implementing engineering initiatives to reduce unit costs,
reducing waste, driving procurement savings and outsourcing across the
businesses.



In the US, the Kingspan approach to drive market conversion by focusing on
selling the features and benefits of integrated raised access floor building
solutions with under floor air conditioning was rolled-out. The approach and
associated marketing campaign has generated considerable interest from
architects and developers.



In Europe, a new range of floors and pedestals was launched. The focus was to
develop a range of price competitive products which met the regulatory
requirements in a targeted number of development markets. Sales have been
encouraging, especially in Spain.



Environmental Containers



This was a year of satisfactory growth. Kingspan has led the conversion in
commercial applications in the UK to replace old single skin oil tanks with new
twin-walled plastic oil tanks complete with a range of measuring devices which
meet all the new environmental regulations in this segment. This range of new
products exceeded expectations in their first year in the UK market and market
conversion is ahead of plan.



In Europe, sales doubled from our new low cost Polish facility. We are now using
this facility to supply most of mainland Europe. In Denmark, Kingspan
successfully lobbied the authorities to permit the use of plastic oil tanks on
environmental grounds instead of only traditional steel tanks. Kingspan has
subsequently become the first company to launch a range of plastic oil tanks in
Denmark.








    GROUP PROFIT AND LOSS ACCOUNT


    FOR THE YEAR ENDED 31ST DECEMBER 2002
                                                Continuing                  Discontinued
                                                Operations   Acquisitions     Activities          Total         Total
                                                      2002           2002           2002           2002          2001
                                                     €'000          €'000          €'000          €'000         €'000
    Turnover                                       729,009          8,078          2,523        739,610       828,947
    Cost of sales                                 (506,586)        (6,394)        (2,256)      (515,236)     (589,424)
    Gross profit                                   222,423          1,684            267        224,374       239,523
    Distribution costs                             (41,223)          (138)             0        (41,361)      (39,560)
    Administrative expenses                        (99,561)        (1,207)          (246)      (101,014)     (102,766)
    Goodwill amortisation                           (8,778)          (109)             0         (8,887)       (8,563)
    Operating profit                                72,861            230             21         73,112        88,634
    Interest payable and similar charges                                                        (10,972)      (16,746)
    Interest receivable and other income                                                          1,605         1,474
    Profit on ordinary activities before                                                         63,745        73,362
    taxation
    Tax on profit on ordinary activities                                                        (13,276)      (17,947)
    Profit on ordinary activities after                                                          50,469        55,415
    taxation
    Minority interest                                                                                13           (20)
    Profit attributable to ordinary                                                              50,482        55,395
    shareholders
    Ordinary dividends                                                                          (29,494)       (7,960)
    Profit retained for the year                                                                 20,988        47,435
    Basic earnings per share                                                                     30.2 c        32.9 c
    Basic earnings per share (before goodwill amortisation)                                      35.5 c        37.9 c
    Diluted earnings per share                                                                   30.0 c        32.3 c

    GROUP BALANCE SHEET                                                                            2002          2001
    AS AT 31ST DECEMBER 2002                                                                      €'000         €'000
    FIXED ASSETS
    Tangible assets                                                                             165,962       167,427
    Intangible assets                                                                           142,645       161,953
    Financial assets                                                                                 36            38
                                                                                                308,643       329,418
    CURRENT ASSETS
    Stocks                                                                                       62,172        61,503
    Trade and other debtors                                                                     168,600       170,133
    Cash and term deposits                                                                       71,782        91,466
                                                                                                302,554       323,102
    CREDITORS
    Amounts falling due within one year
    Trade and other creditors                                                                   140,215       139,537
    Bank and other borrowings                                                                    28,375        35,234
    Deferred consideration                                                                          311             0
    Dividends                                                                                    26,034         4,996
                                                                                                194,935       179,767
    NET CURRENT ASSETS                                                                          107,619       143,335
    TOTAL ASSETS LESS CURRENT LIABILITIES                                                       416,262       472,753
    CREDITORS
    Amounts falling due after more than one
    year
    Bank and other borrowings                                                                   156,138       220,256
    Deferred consideration                                                                        4,264         5,663
                                                                                                160,402       225,919
    PROVISIONS FOR LIABILITIES AND CHARGES                                                       17,156        12,757
    CAPITAL GRANTS                                                                                1,145         1,343
                                                                                                237,559       232,734
    CAPITAL AND RESERVES
    Called-up share capital                                                                      21,631        22,019
    Share premium account                                                                        18,214        17,248
    Revaluation reserve                                                                             891           891
    Profit and loss account                                                                     200,453       187,471
    Other reserves                                                                               (5,285)        3,355
    Shareholders' funds                                                                         235,904       230,984

    MINORITY INTERESTS
    Including non-equity interests                                                                1,655         1,750
                                                                                                237,559       232,734

    GROUP CASH FLOW STATEMENT                                                                      2002          2001
    FOR THE YEAR ENDED 31ST DECEMBER 2002                                                         €'000         €'000
    Net cash inflow from operating activities                                                   102,979       146,658

    Returns on investments and servicing of finance
    Interest received                                                                             1,597         1,483
    Interest paid                                                                               (12,555)      (15,560)
    Interest element of finance lease rental                                                        (11)          (28)
    payments
    Net cash outflow from returns on
    investments
    and servicing of finance                                                                    (10,969)      (14,105)
    Taxation
    Corporation tax paid                                                                        (10,713)      (16,308)
    Capital expenditure and financial
    investment
    Purchase of tangible fixed assets                                                           (30,029)      (35,831)
    Less new finance leases                                                                           0             2
    Proceeds on sale of tangible fixed assets                                                       673         2,132
                                                                                                (29,356)      (33,697)

    Net cash outflow for capital expenditure and financial
    investment

    Acquisitions and disposals
    Purchase of subsidiary undertakings                                                          (7,855)     (100,280)
    Net cash acquired with acquisitions                                                             552           701
    Payment of deferred consideration in respect of                                              (1,069)       (2,276)
    acquisitions
    Disposal of subsidiary undertakings                                                           1,204             0
    Net cash disposed with disposals                                                               (839)            0
    Net cash outflow for acquisitions and                                                        (8,007)     (101,855)
    disposals
    Equity dividends paid                                                                        (8,456)       (6,799)
    Cash inflow/(outflow) before use of liquid resources and financing                           35,478       (26,106)
    Management of liquid resources
    (Increase) in bank deposits                                                                  (5,505)      (23,401)
    Financing
    Issue of shares                                                                               1,091          462
    (Decrease)/Increase in term debt                                                            (31,745)       69,001
    Capital element of finance lease                                                               (106)         (288)
    repayments
    Acquisition of own shares                                                                    (8,006)       (3,980)
    Capital grants received                                                                           6             0
    Acquisition of shares held by minorities                                                        (16)       (1,371)
    Dividends paid to minorities                                                                      0          (210)
    Net cash (outflow)/ inflow from financing                                                   (38,776)       63,614
    (Decrease)/Increase in cash for the year                                                     (8,803)       14,107

    GROUP CASH FLOW STATEMENT                                                                      2002          2001
    FOR THE YEAR ENDED 31ST DECEMBER 2002                                                         €'000         €'000
    Reconciliation of net cash flow to movement in net debt
    (Decrease)/Increase in cash for the year                                                     (8,803)       14,107
    Increase in liquid resources                                                                  5,505        23,401
    Cash flow from movement in debt, lease finance & deferred                                    32,920       (66,436)
    consideration
    Change in net debt resulting from cash                                                       29,622       (28,928)
    flows
    Loans and finance leases acquired with                                                          (51)      (21,586)
    subsidiaries
    Deferred consideration arising on acquisitions during                                          (311)          783
    the year
    New finance leases                                                                                0            (2)
    Translation adjustment                                                                       23,121       (10,028)
    Movement in net debt in the year                                                             52,381       (59,761)
    Net debt at start of year                                                                  (169,687)     (109,926)
    Net debt at end of year                                                                    (117,306)     (169,687)
 
    STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES                                                 2002          2001
    FOR THE YEAR ENDED 31ST DECEMBER 2002                                                         €'000         €'000
    Profit for financial year attributable to Group                                              50,482        55,395
    shareholders
    Exchange adjustments                                                                         (9,153)        3,159
    Total gains and losses recognised since last annual                                          41,329        58,554
    report
 
   SUPPLEMENTARY INFORMATION

  1 REPORTING CURRENCY

    The financial statements are presented in Euro.  Results and cash flows of foreign subsidiary
    undertakings have been translated into Euro at the average exchange rates, and the related balance sheets have been
    translated at the rates of exchange ruling at the balance sheet date.

    Exchange rates used were as follows:              Average rate                               Year end rate
    Euro =                                             2002           2001                          2002          2001

    Pound Sterling                                   0.6291         0.6219                        0.6504        0.6085
    U.S.Dollar                                       0.9456         0.8956                        1.0428        0.8813
    Polish Zloty                                     3.8486         3.6721                        3.9984        3.4953
    Czech Koruna                                    30.9119        34.0685                       31.4040       31.9620
    Hong Kong Dollar                                 7.3759         6.9855                        8.1343        6.8723

  2 TURNOVER                                                                                       2002          2001
                                                                                                  €'000         €'000
    The analysis by class of activity is as
    follows:
    Insulated panels                                                                            240,240       248,011
    Raised access flooring                                                                      160,716       252,455
    Insulation boards                                                                           123,170        98,306
    Environmental containers                                                                    118,610       116,147
    Building components                                                                          96,874       114,028
                                                                                                739,610       828,947

                                                                                                   2002          2001
                                                                                                  €'000         €'000
    The analysis by geographical area is as
    follows:
    Republic of Ireland                                                                          94,179       108,919
    Britain and Northern Ireland                                                                475,542       493,764
    Mainland Europe                                                                              98,225        94,126
    United States of America                                                                     49,006       109,221
    Other                                                                                        22,658        22,917
                                                                                                739,610       828,947

  3 DIVIDENDS                                                                                       2002         2001
                                                                                                   €'000        €'000




    Ordinary dividends
    Paid:                                  Interim dividend 2.10c per                              3,460        2,964
                                           share (2001: 1.75c per share)
                                           on 164,774,915 shares

    Payable:                               Final dividend 3.80c per share                          6,261        4,996
                                           (2001: 2.95c per share) on
                                           164,774,915 shares

    Payable:                               Special dividend 12.00c per                            19,773            -
                                           share (2001: nil per share) on
                                           164,774,915 shares

                                                                                                 29,494        7,960

    The Board is recommending the payment of a final dividend of 3.80c per share , and a special dividend of 12.0c per
    share to be paid, subject to shareholder approval to shareholders registered at close of business on 21 March 2003.

  4 RECONCILIATION OF MOVEMENTS IN                                                                 2002          2001
    SHAREHOLDERS' FUNDS                                                                           €'000         €'000
    Profit for the financial year attributable to Group                                          50,482        55,395
    shareholders
    Dividends                                                                                   (29,494)       (7,960)
                                                                                                 20,988        47,435
    Exchange adjustments                                                                         (9,153)        3,159
    Purchase of treasury shares                                                                  (8,006)       (4,499)
    New share capital subscribed                                                                  1,091           462
    Net addition to shareholders' funds                                                           4,920        46,557
    Opening shareholders' funds                                                                 230,984       184,427
    Closing shareholders' funds                                                                 235,904       230,984

  5 RECONCILIATION OF OPERATING PROFIT TO                                                          2002          2001
    NET CASH FLOW FROM OPERATING ACTIVITIES                                                       €'000         €'000
    Operating profit                                                                             73,112        88,634
    Depreciation charges                                                                         21,227        22,236
    Amortisation of intangible assets                                                             9,370         9,046
    Loss on sale of tangible assets                                                               1,147            38
    (Profit) on sale of operation                                                                   (10)            0
    Government grants amortised                                                                    (152)         (174)
    (Increase)/Decrease in stocks                                                                (3,183)       19,125
    (Increase)/Decrease in debtors                                                               (6,802)       26,512
     Increase/(Decrease) in creditors                                                             8,270       (18,759)
                                                                                                102,979       146,658

  6 EARNINGS PER SHARE                                                                             2002          2001
                                                                                                  €'000         €'000
    The calculations of earnings per share are based on the
    following:
    Profit attributable to ordinary                                                              50,482        55,395
    shareholders
                                                                                              Number of     Number of
                                                                                          shares ('000)  shares ('000)

    Weighted average number of ordinary shares for the calculation of                           167,121       168,543
    basic earnings per share
    Dilutive effect of share options                                                              1,304         3,055
    Weighted average number of ordinary shares for the calculation of diluted earnings          168,425       171,598
    per share
                                                                                                 € Cent        € Cent
    Basic earnings per share                                                                       30.2          32.9
    Diluted earnings per share                                                                     30.0          32.3
    Basic earnings per share before goodwill                                                       35.5          37.9
    amortisation

  7 ABBREVIATED ACCOUNTS

    The 2002 financial information is an abridged version of the Group's financial statements which have not yet been
    filed with the Registrar of Companies but upon which the auditors have given an unqualified audit report.  The 2001 
    figures are an extract from the Group's statutory accounts for the year ended 31 December 2001 which have been filed
    with the Registrar of Companies and audited and reported upon without qualification.

  8 DISTRIBUTION OF THIS PRELIMINARY ANNOUNCEMENT
    These results are available on the Group's website at www.kingspan.com.  A printed copy is available to the public
    from 12th March 2003 at the Company's registered office or from the Company's Registrars: Computershare Services    
   (Ireland) Limited, Heron House, Corrig Road, Sandyford Industrial Estate, Dublin 18.




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