Final Results

Ricardo PLC
23 September 2002

                                                               23 September 2002

                                  Ricardo plc

          Preliminary Results for the twelve months ended 30 June 2002


HIGHLIGHTS

Ricardo plc is the UK's leading independent automotive consultancy, employing
over 1,400 people with technical centres in the UK, USA, Germany and the Czech
Republic.   The company's client list includes the world's major OEMs. Ricardo
is a constituent of the FTSE techMark 100.

• Record results for fifth consecutive year

• Profit before tax up 10.3% to £16.7m (2001: £15.1m)

• Basic earnings per share up 12.2% to 24.9p (2001: 22.2p)

• Order book up 6% to £62m (2001: £58.5m)

• Dividend up 10.3% to 8.6p (2001: 7.8p)

• Strong balance sheet and cash generation - net cash of £19.9m (2001: £1.3m)


Commenting on the results, Rodney Westhead, Chief Executive said:

'This has been another good year for Ricardo. Although the automotive industry
remains challenging, Ricardo has achieved its fifth consecutive year of record
results. The company has a strong balance sheet with net cash of £19.9m and
whilst increased pension and insurance charges will have an impact, nonetheless
the Board remains confident of continued progress in the current financial 
year.'


Further enquiries:

Ricardo plc
Rodney Westhead, Chief Executive                           (today) 020 7554 1400
Andrew Goodburn, Finance Director                      (thereafter) 01273 455611

Gavin Anderson & Company
Laura Hickman/Charlotte Stone                                      020 7554 1400

Website: www.ricardo.com





                              CHAIRMAN'S STATEMENT

Annual results and dividend

Profit before tax was £16.7m compared with £15.1m last year.  Turnover increased
to £143.2m from £139.9m.  Earnings per share increased by 12.2% to 24.9p from
22.2p.  Continued application of good cash management practices produced a net
cash inflow of £16.8m, which translates into net cash balances of £19.9m at the
end of the year.  Your Board is recommending an increase in total dividend of
10.3% to 8.6p per share, compared with 7.8p last year.  This dividend is covered
2.9 times compared to 2.8 times in 2001.

Review of the year

During the past year, despite the problems of the world economy and the reaction
to and aftermath from 11 September, Ricardo has continued to develop its
position as one of the leading players in the international automotive industry.
Our commitment to the provision of the highest quality consultancy services to
this industry has enabled us to achieve record profits for the fifth consecutive
year.

All divisions have contributed to this success.  In particular, the
transmissions business Ricardo Driveline and Transmission Systems (RDTS) had an
outstanding year. Despite the fact that a part of this business was transferred
to Ricardo Vehicle Engineering (RVE) when that division was formed in 2001, its
response has been to grow its core transmissions business to more than offset
the transfer.  RDTS once again supported the Audi team at Le Mans, where those
cars fitted with Ricardo transmissions won first and second place for the third
year running.  Shortly after the end of the year we acquired the business and
assets of Gemini Transmissions Limited, a specialist transmissions company
located not far from Leamington, which is equipped with many of the machine
tools we require for the support of our consultancy services and development of
motor sport interests.

Despite the pressures evident in the market place, RVE made a promising start
achieving an encouraging turnover and profit in its first year of autonomy.

Both Ricardo Consulting Engineers (RCE) at Shoreham and Ricardo North America
(Rinc) conducted their businesses in markets where pressure on margins was
significant.  This was promptly tackled by reducing costs and continually
improving our own internal efficiencies.  We remain confident about the long
term opportunities in both these subsidiaries and in September 2001 authorised
the landlord to build an extension to our facilities in Detroit to more
efficiently respond to those demands in the future.

Strategy

Whilst adhering to the strategy of providing engineering consultancy services to
the automotive industry, which has served us well in recent years, we have
decided to extend the consultancy service we offer to our clients to encompass
several of the strategic issues which our customers encounter.  We have
recruited Stephen Parker, a senior, well respected individual from the industry,
and given him a remit to develop a capacity to provide strategic consulting
alongside the company's existing technology based activity.  He joined the Board
on 1 August 2002.

Alongside our core consultancy business we have continued to benefit from the
policy, which I mentioned last year, of exploiting some of the intellectual
property we have developed in recent years.

People

Our business is a people business and the company is fortunate to have such a
competent and committed staff. Once again I thank them all for the contribution
they have made.

Prospects & outlook

In the current financial year we are making a significant investment in setting
up a strategic consulting business and integrating Gemini. Whilst our cost base
is directly impacted by an increased pension charge, our business continues to
grow and we face the future with confidence.



                              CHIEF EXECUTIVE'S REVIEW

Ricardo market place

I am pleased to report record results for the fifth consecutive year in an ever
tougher market place. Recession in the United States and Germany has led to a
very competitive environment with all of our customers striving to reduce their
costs.  Despite these pressures we enter the new financial year with a record
order book.  The overall mix of our order book continues to change, reflecting a
move away from  testing to increasing volumes of engineering design consultancy.

Our profile and reputation within our industry continue to rise and, whilst this
is good news in helping to develop new business, it does mean that increasingly
our customers put our proposals to them under the microscope, especially as
regards cost and performance.

The United States has been a particularly difficult market over the last year
with recession following the events of 11 September and continuing problems for
some of our major customers. This is our most challenging market place.
However, the satisfactory delivery of a number of major programmes, together
with cost containment, resulted in a profitable year.  This has helped to raise
the level of new opportunities and proposals presented. In addition, we have
further strengthened our management team.

Business development

The past year was the first year for the newly created RVE business based at our
Leamington site.  The year started with one major programme underway and closed
with two major programmes in progress and excellent prospects for the future.
The clear focus that we now have between engine, transmission and vehicle is
benefiting our programme delivery and marketing, and has been achieved at
minimal extra cost.

Just after the year end we concluded the acquisition of the assets and staff of
Gemini Transmissions Limited, a company specialising in the development and
production of motorsport racing transmissions to further strengthen our growing
presence in motorsport.  We are pleased to welcome the Gemini staff to Ricardo
and look forward to the integration of this business into Ricardo and the
further development of our motorsport activities.  We will increasingly promote
and develop this business stream where our core skills in engine, transmissions
and vehicle engineering can be readily applied.  Whereas the popular view is
that motorsport leads the automotive industry in technical development, for
Ricardo, the reality is that our technology developments for the mainstream
industry can likewise benefit the motorsport industry.

One of our fastest growing areas of expertise is electronics and controls for
engines, vehicle and transmissions.  During the course of the year we opened an
office in Bedfordshire, specifically to attract the high calibre staff that were
becoming available in that locality.  Development of this key expertise remains
a priority and one in which we will continue to concentrate our resources.

Our development in Germany, Europe's major automotive development country has
continued.  The volume of work carried out and orders won have grown
significantly, aided by our three recently established offices. As well as
looking for growth in Germany we are also looking for accelerated growth in many
aspects of automotive electronics but excluding in-car entertainment.  We will
also consider other automotive areas where high added value and intellectual
capital can be achieved but not in volume dependent activities.

A significant building programme in Detroit is nearing completion to bring the
majority of our US business under one roof and to provide improved facilities
for this business as the US remains at the centre of our strategic development.

In Japan we carry out a steadily increasing level of business and in the year
have won our largest orders ever from this country.  Our level of contact
continues to grow as our Japanese customers increasingly recognise their need to
outsource and utilise Ricardo's range of capabilities.  We will continue to
develop our client base in Japan.

Research and development

Each year Ricardo spends approximately £5 million at prime cost of our own money
on research and development and considerably more on behalf of our customers.
Our costs are fully expensed.  Many of these research programmes have
historically led to the development of advanced concepts and capabilities which
in future years have been part of our service offering.  This year has seen the
fruition of a 24 month programme to develop a vehicle demonstrator, embodying
much of our efforts in that time.  This vehicle, code-named i-MoGen -
Intelligent Motor Generator - is a mild hybrid vehicle with a 42 volt
electronics, regenerative braking, integrated starter motor and generator with a
highly complex electronic control system.  The vehicle is powered by a 1.2 litre
turbo charged diesel engine, significantly downsized from the original 2 litre
engine in the host vehicle, with a 28% improvement in fuel efficiency.   i-MoGen
has been driven by senior executives from all the major European and United
States automotive companies to great acclaim and is a superb showcase for
Ricardo skills and expertise.  The vehicle will be demonstrated in Japan and
Korea in October.

As I reported last year, we are increasingly seeking to exploit our intellectual
property and this year our income from this source has continued to grow.

People

Staff numbers have remained stable in the year but this conceals a constantly
changing mix as the business continues to grow high added-value engineering
consultancy and the volume of testing reduced in line with industry demands.

We confirm our continuing support for our final salary and money purchase
pension schemes, increasing the company's contributions to both of these
schemes.  Over the last 10 years, the company's contribution to the final salary
scheme has had to increase from 5% to 26% of payroll for those members of staff
in the scheme and for the new financial year 2002/03, our pensions charge will
increase by approximately £1.4m.  However, our staff are our principal asset and
we consider that our pension schemes, incentive plans and base salary levels are
a vital part, in ensuring that they are properly rewarded.



Consolidated Profit & Loss Account
for the year ended 30 June 2002
                                                                             2002            2001
                                                                 Notes      £'000           £'000

Turnover                                                             2
Continuing operations                                                     143,178         138,370
Discontinued operation                                                          -           1,541
                                                                          143,178         139,911
Operating Profit
Continuing operations                                                      16,495          15,681
Discontinued operation                                                          -              10
                                                                           16,495          15,691
Profit on disposal of discontinued operation                                    -               -
Net interest                                                                  164            (584)

Profit on ordinary activities before taxation                              16,659          15,107
Taxation on profit on ordinary activities                                  (4,506)         (4,277)

Profit on ordinary activities after taxation                         3     12,153          10,830
Equity minority interest                                                      (92)           (187)

Profit for the financial year                                              12,061          10,643
Dividends - including non equity                                           (4,207)         (3,755)

Retained profit for the year                                                7,854           6,888

Basic earnings per ordinary share                                    5       24.9 p          22.2p
Diluted earnings per ordinary share                                  5       24.5 p          21.6p



There is no material difference between the profit on ordinary activities before taxation and the
retained profit for the year stated above and their historical cost equivalents.




Consolidated  Balance Sheet
as at 30 June 2002
                                                                                  2002             2001
                                                                                 £'000            £'000
Fixed assets
Intangible assets                                                                   35               48
Tangible assets                                                                 45,195           49,445
Investment properties                                                                -               75
Investments                                                                        331              723
                                                                                45,561           50,291
Current assets
Stocks                                                                           1,667            1,487
Debtors                                                                         46,322           43,010
Cash deposit                                                                       340              340
Cash at bank and in hand                                                        28,090           13,564
                                                                                76,419           58,401
Creditors - amounts falling due within one year                                (53,166)         (45,263)

Net current assets                                                              23,253           13,138

Total assets less current liabilities                                           68,814           63,429
Creditors - amounts falling due after more than one year                        (6,840)          (8,641)
Provisions for liabilities and charges                                          (5,783)          (6,302)

Net assets                                                                      56,191           48,486

Capital and reserves
Called up share capital                                                         12,247           12,154
Share premium account                                                            9,767            8,364
Capital redemption reserve                                                          40               40
Merger reserve                                                                     967              967
Long term incentive plan reserve                                                   594              610
Profit and loss account                                                         32,293           25,996

Total shareholders' funds (including non-equity interests)                      55,908           48,131

Equity minority interest                                                           283              355

Capital employed                                                                56,191           48,486





Consolidated Cash Flow Statement
For the year ended 30 June 2002

                                                                           2002                 2001
                                                             Notes    £ 000       £ 000     £ 000       £ 000

Net cash inflow from operating activities                        6               30,242                23,644

Returns on investments and servicing of finance
Interest received                                                       727                   955
Interest paid                                                          (541)               (1,595)
Interest element of finance lease rental payments                         -                    (5)
Dividends paid on non-equity shares                                       -                    (2)
Dividend paid to minority shareholder                                  (141)                  (93)
Net cash inflow/(outflow) from returns on investment and
servicing of finance                                                                 45                 (740)

Taxation                                                                        (3,204)               (4,202)

Capital expenditure and financial investment
Unlisted trade investment                                                 -                  (232)
Purchase of tangible fixed assets                                    (5,967)              (13,032)
Sale of tangible fixed assets                                           332                   761
Net cash outflow from capital expenditure and financial
investment                                                                      (5,635)              (12,503)
Acquisitions and disposals
Sale of subsidiary undertaking                                            -                 3,255
Cost of disposal                                                          -                  (260)
Net cash inflow from acquisitions and disposals                                      -                 2,995
Equity dividends paid                                                           (3,829)               (3,587)

Cash flow before use of financing                                               17,619                 5,607
Financing
Issue of ordinary share capital                                         345                   450
Redemption of preference shares                                           -                   (72)
Amount received in respect of ESOP shares                                49                     -
Capital elements of finance lease rental payments                        (1)                  (52)
Loans repaid                                                         (1,209)                 (306)
Net cash (outflow)/inflow from financing                                          (816)                 20
Increase in cash                                                 8              16,803                  5,627





NOTES TO THE ACCOUNTS

1. Accounting policies

This preliminary announcement has been prepared on the basis of the accounting
policies as set out in the annual financial statements for the year ended 30
June 2002.

2. Turnover

                                                                          2002                   2001
                                                                         £'000                  £'000

Europe                                                                  87,699                 78,060
North America                                                           46,912                 55,255
Pacific Basin                                                            7,046                  3,076
Rest of the World                                                        1,521                  3,520
                                                                       143,178                139,911


The directors consider that the Group operates in one business segment, serving
the global automotive market.  The United Kingdom is the principal location for
operating profits and the net assets of the Group.  As a consequence, it is not
meaningful to show separately its turnover, operating results or net assets.

3. Profit on ordinary activities before taxation

Profit on ordinary activities before taxation is after charging for research and
development of £4.6 million (2001: £5.3 million) and depreciation of £9.1
million (2001: £8.1 million).

4. Dividends

The final dividend is 6.0p (2001: 5.3p).  This is payable on 22 November 2002 to
ordinary shareholders on the register on 25 October 2002.

5. Earnings per share

Basic earnings per share is calculated by dividing the earnings attributable to
ordinary shareholders by the weighted average number of shares in issue during
the year, excluding those held in the ESOP and those held by the LTIP which are
treated as cancelled.

For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all dilutive potential ordinary
shares.  The Group has two classes of dilutive potential ordinary shares: those
options granted to employees where the exercise price is less than the market
price of the Company's ordinary shares during the year and the contingently
issuable shares under the Group's LTIP.  At 30 June 2002, the performance
criteria for the vesting of awards under the plans maturing on 30 June 2003 and
30 June 2004 had not been met and consequently the shares in question are
excluded from the diluted earnings per share computation.

The weighted average number of shares used in the calculations are below:

                                                                                        2002          2001
                                                                                        '000          '000
Basic eps                                                                             48,352        47,844
Diluted eps                                                                           49,150        49,222



6  Net cash inflow from operating activities

                                                                                       2002          2001
                                                                                      £'000         £'000

Operating profit                                                                     16,495        15,691
Depreciation Charges                                                                  9,117         8,068
Goodwill amortisation                                                                    13            11
Profit on sale of tangible fixed assets and investment properties                       (14)         (108)
Long term incentive plan charge                                                         455           611
(Increase)/ decrease in stock                                                          (195)          278
Increase in debtors                                                                  (3,531)       (1,116)
Increase/(decrease) in creditors                                                      7,902           (52)
Foreign exchange                                                                          -           261
Net cash inflow from operating activities                                            30,242        23,644



7  Reconciliation of net cash flow to movement in net funds

                                                                            2002                  2001
                                                                           £'000                 £'000

Increase in cash                                                          16,803                5,627
Movement in debt and lease financing                                       1,210                  358
Change in net funds from cash flows                                       18,013                5,985
Translation difference                                                       637                 (285)
Movement in net funds in year                                             18,650                 5,700
Net funds (debt) at 1 July                                                 1,288               (4,412)
Net funds at 30 June                                                      19,938                 1,288


8  Analysis of net funds

                                     At 1 July            Cash          Exchange         At 30 June
                                          2001            flow          movement               2002
                                         £'000           £'000             £'000              £'000


Cash in hand                            13,564          14,762              (236)            28,090

Overdrafts                              (3,634)          2,041               281             (1,312)

Sub total                                9,930          16,803                45             26,778

Debt due after 1 year                   (8,641)          1,209               592             (6,840)

Finance leases                              (1)              1                 -                  -

Total                                     1,288         18,013                637            19,938



9  The figures for the year ended 30 June 2002 are an extract from the
Group's statutory accounts, which will be delivered to the Registrar of
Companies following the Annual General Meeting.  The independent auditors'
report on these accounts was unqualified and does not contain any statement
under section 237 of the Companies Act 1985.



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