AGM Statement

Press Release 28 November 2007


Quadnetics Group plc

AGM Trading Statement


Quadnetics has had a mixed start to the current financial year, with
weaker than anticipated trading in the first half, offset by strength
in orders and apparent continuing growth in underlying customer
demand reinforcing expectations of a very positive second half.

New orders and, especially, bid activity levels have been high in
most areas of the Group. In particular, important new orders have
been won for a leading global investment bank, a major new Middle
East oil & gas project, a number of additional casinos in North
America, and two high security prisons.

Several factors, however, have been holding back financial progress.
Most notable has been the slowdown in finalisation of orders and
delivery schedules from central government customers in the UK, and
from existing customers in the Middle East. Synectics has also
experienced problems with a key component supplier for its new
digital product suite that have contributed to delays of
approximately three months in expected delivery dates of production
units of these important and exciting products. The primary cause of
these delays has now been resolved and no further such issues are
anticipated.

Outside the UK, the growth momentum in the North American casino
market is continuing. Trading in the year to date has been
substantially ahead of the same period last year, and we continue to
expect that sales in this area for the full year will be up by around
50%. Translated sterling earnings, though, are being somewhat
affected by the weakness of the US dollar.

Our consolidated Group sales in the five months to the end of October
have been 8% ahead of the same period last year. The outstanding
order book at 31 October was up by 4% on last year, although the
recurring revenue component within these figures was up by nearly
50%, primarily from new or renewed multi-year contracts in our retail
managed security services activities.

In view of the slower than planned delivery of continued margin
improvements in some areas, actions have been and are being taken to
reduce costs, though these involve one-off expenses in the short
term.

On the basis of these combined factors, Quadnetics is now
anticipating that consolidated underlying profits* for the year to 31
May 2008 will be approximately in line with last year, with a
slightly higher weighting towards the second half compared with last
year.

To take full advantage of the greatly increased scale of the Group's
activities over the past two years, and the cross-selling
opportunities this creates, we are continuing to move Quadnetics
towards a single-business structure. The benefits of this approach
are beginning to show through, with the current consolidated bid
pipeline noticeably increasing. In part this reflects a high level of
interest in the new Synectics digital product suite across all
Quadnetics' customer sectors, and these products should start to
contribute meaningfully to results from the final quarter of this
financial year on.

Taking into account the growing order book and bid pipeline, the
imminent ramp up of sales of Synectics' new products, and actions
already taken to reduce costs, the Board is confident Quadnetics will
rapidly resume the solid pattern of profits growth demonstrated over
the past several years.

*profit before tax, exceptional items, goodwill amortisation and
share-based payment charges



For further information, please
contact:

Quadnetics Group plc                         Tel: [phone]
(www.quadnetics.com)
Russ Singleton, Chief Executive  Email: [e-mail]

Brewin Dolphin Securities                   Tel: [phone]
Neil Baldwin

Buchanan Communications                     Tel: [phone]
Tim Anderson/Isabel Podda              Email: [e-mail]

---END OF MESSAGE---