Final Results

Evolution Group PLC
25 March 2004

                                                                   25 March 2004


                            The Evolution Group Plc
                        ("Evolution Group", the "Group")

            Preliminary results for the year ended 31 December 2003

Evolution Group, the listed investment bank and retail fund management group,
today announces its preliminary results for the year ended 31 December 2003.


Financial highlights

  • Total Group operating income increased by 159% to £40.8 million (2002:
    £15.8 million)
  • Profit before tax rose to £17.9 million (2002: Loss of £23.8 million)
  • Basic earnings per share increased to 6.7p (2002: Loss of 13.7p)
  • Strong cash generation across the Group with cash balances at £54 million
  • Inaugural payment of dividend of 0.25p (2002: Nil)


Operational highlights


  • Successful first full year, as a combined business, for Evolution Beeson
    Gregory
  • 46% increase in funds under management for Christows
  • £15 million of cash raised from part disposal of holding in IP2IPO
  • Group maintains a 41% holding in IP2IPO post its flotation on AIM
  • Group moved to the Official List in June 2003 and recently entered the
    FTSE-250


Commenting on the results and the Group's outlook, Richard Griffiths, Evolution
Group's Chairman, said:

"2003 was a year of strong growth in all our operating businesses.

"As the first quarter of this year comes towards a conclusion, I am pleased to
announce that our businesses are all continuing to progress well and the Board
is confident of further success in 2004."



                                     -Ends-


For further information, please contact:

The Evolution Group Plc                                   020 7071 4300
Alex Snow, Chief Executive Officer
Graeme Dell, Finance Director

Hogarth Partnership Limited                               020 7357 9477
Andrew Jaques
Georgina Briscoe


Notes to Editors:

The Evolution Group Plc

The Evolution Group is the holding company of Evolution Beeson Gregory,
Christows and IP2IPO.  The Evolution Group is fully listed with a current market
capitalisation of approximately £300 million.

Evolution Beeson Gregory ("EVBG") aims to be the "leading investment bank to
small and mid cap companies".  This is based upon the belief that it has the
strategy and capabilities to achieve this goal, coupled with the fact that the
market opportunity exists for this strategy to be a successful and profitable
one.

The company's capabilities are strong across the primary and secondary equity
market and central to this is the presence of a leading, retained corporate
client base in the small and mid cap sector.  We service these clients by
providing the full range of corporate finance, equity research, market making
and sales activities and delivering all of these with a strong client service
culture.

Christows is a leading independent firm of stockbrokers and portfolio managers
which, from its foundation in 1991 in Exeter, has always set out to provide a
traditional stockbroking service whilst developing an innovative product
offering.  Christows now also operates from London, Bath and Bournemouth and has
68 staff across account executive, research, sales and administration staff.

As at 31 December 2003, Christows had a total of £477m client funds under
management, on 83% of which it receives a recurring fee based commission.
Christows' strategy for 2004 is one of controlled growth of the funds under
management by organic means through the sales and account executive teams and by
the recruitment of likeminded account executives who can attract new clients to
the company.

IP2IPO is now partly owned by Evolution Beeson Gregory with a 40.61% stake.
IP2IPO's business is the formation of long-term university partnerships in which
it receives a significant interest in the intellectual property created by its
university partners.

IP2IPO successfully listed on AIM in October 2003.  Since then it has continued
to make progress in the development of spin out companies from its ongoing
university partnerships.



CHAIRMAN'S STATEMENT

2003 was a year of strong growth in all of our operating businesses.
Additionally, the Group realised significant value from the listing of its
former subsidiary, IP2IPO Group Plc (formerly IP2IPO Group Limited ("IP2IPO")).
Overall, I am pleased to report a profit before tax of £17.9 million (2002: loss
£23.8 million). Total shareholder return rose 88% during 2003, 48% ahead of the
FTSE Smallcap Index.

Evolution Beeson Gregory Limited ("EVBG") had a very good first full year as a
combined business and our investment banking platform developed significantly
during 2003. We continued to gain market share in the small and mid cap sectors
in sales and trading and our significantly enhanced market making business
performed well and ahead of our expectations. Corporate broking remained a
cornerstone of our business with significant transactions completed and funds
raised for our clients. Operating income has grown by 264% to £32.1m in 2003
with all divisions showing extremely strong growth. Finally, our research
coverage continues to increase in depth and quality as evidenced by our improved
ratings in key market surveys such as Extel and Institutional Investor.

Christows Limited ("Christows"), the Group's private client stockbroking and
fund management business, had a second profitable year after its restructuring
in 2001. It continues to increase its funds under management, reaching £477m as
at 31 December 2003 (2002: £327m), an increase of 46%. Strategic funds under
management, on which we receive recurring fees, now represent 83% of this total
(2002: 77%). This business is developing to plan and has increased its
geographical coverage with the opening of a new office in Bath, strengthening
its presence in the South and South West of England.

IP2IPO has made a significant transformation during 2003. Following the
successful listing on AIM on 15 October 2003, IP2IPO is now a separate and
independently functioning operation. The Group has reduced its holding in this
company to 40.61% following the sale of 5,460,000 shares upon the flotation.
This process realised £15m of cash.

The Board is delighted to have announced the appointment of Nicholas Irens as a
Non-Executive director on 1 January 2004. Nick has a wealth of experience, from
both executive and non-executive roles, and is a valuable addition to the Board.

At the time of the announcement of IP2IPO's preliminary results on 18 March
2004, David Norwood, the Chief Executive of IP2IPO, informed the Board of his
decision to step down as a Non-Executive director of the Company. I would like
to take this opportunity on behalf of the Board, employees and shareholders to
thank David for his enormous contribution both in the creation and the
successful building of the Group.

The results of our operating businesses are determined largely by the efforts
and commitment of our staff who are one of the principal assets of the Group, I
would like to thank everyone for their efforts last year which contributed to a
successful 2003. As highlighted at the interim stage and in the subsequent
shareholder notice, the Group implemented an all employee share incentive plan
which has now been successfully launched, through which the majority of
employees have taken the opportunity to purchase Evolution shares every month,
which are then matched by the Company where individuals remain in the Group for
three years. Additionally, throughout the Group, there are other option and
share schemes which we use to provide equity participation to incentivise and
motivate our key employees.


Dividend

The Board recommends the payment of a dividend of 0.25p per share (2002: Nil).
This represents an acknowledgement of our growth in confidence in the income
growth and profitability of the Group. It is anticipated that a progressive
dividend policy will be pursued as the Group achieves its objectives in 2004.


Outlook

As the first quarter of 2004 comes towards a conclusion, I am pleased to
announce that our businesses are all continuing to progress well and your Board
is confident of further success in 2004.


Richard Griffiths
Chairman



Chief Executive's Report

Review of the year

The Group made substantial progress in 2003. All areas of our business have been
strong and there has been a significant increase in income generation. Total
operating income in 2003 was £40.8m (2002: £15.8m), an increase of 159%.

During 2003, the Group was able to create substantial shareholder value, in
separating, by way of flotation, our intellectual property subsidiary IP2IPO,
and the Group saw a significant realisation from the part disposal of the
Group's interest.

The core of the Group's business now consists principally of Institutional
equity broking and Private client stockbroking and fund management, and both
businesses have outperformed the respective budgets for 2003. It has always been
the Group's strategy to retain separate brands, and both are managed as
independent businesses in all respects.


Performance Breakdown


                                                       2003                                    2002
Operating Income                                      £'000                   %               £'000                   %

EVBG                                                 32,126                  79               8,835                  56
Christows                                             8,327                  20               6,644                  42
Other income                                            298                   1                 281                   2
                                                     40,751                 100              15,760                 100

Corporate finance                                    17,272                  42               4,489                  28
Sales commissions                                     9,067                  22               5,913                  38
Trading                                              10,994                  27               2,196                  14
Management fees                                       2,851                   7               2,748                  17
Other income                                            567                   2                 414                   3
                                                     40,751                 100              15,760                 100



Evolution Beeson Gregory ("EVBG")

EVBG continues to be the largest operating business within the Group. Total
operating income increased by 264% to £32.1m (2002: £8.8m), although conditions
in 2003 were mixed. The first half was dominated by the Gulf War and difficult
equities markets. EVBG was able to trade profitably through this period, with
the reduced cost structure that was introduced in 2002. The appetite for risk
increased in the second half of 2003 and EVBG was able to accelerate its income
generation and profitability.


Corporate broking

Our corporate broking track record in 2003 has been extremely encouraging,
overall income increased by 285% to £17.3m (2002: £4.5m).

During 2003 EVBG advised on 60 transactions. In total, we raised £271m for our
clients. Our ability to provide these services successfully for our clients
comes from our knowledge and understanding of those client companies and the
in-depth research into these companies and their business opportunities. Our
retained corporate client list had increased to 107 at the year end. The
opportunity is still substantial to provide integrated advisory services to
small and mid-capitalisation UK companies, EVBG continues to be innovative in
its thinking to provide equity finance solutions to our customers.


Equity research and Equity distribution

In research, EVBG has continued to increase our sector coverage in 2003,
reinforcing EVBG's aim to be a research led equity business with qualified,
specialist analysts. At the year end, EVBG had coverage of in excess of 190
stocks across sectors, including: health, pharmaceutical and biotech, general
retail, leisure and hotels, media and entertainment, support services,
electronics, software, mining, oil and gas, construction/building, materials and
infrastructure. The improved research product is evidenced by the continued
market share growth in sales and the improved ratings in surveys such as Extel
and Institutional investor.

Sales and distribution have strengthened throughout 2003. EVBG has seen an
increase in the flow of secondary sales commissions. New recruits to the team
have successfully secured new sales channels into international institutional
investors. This new dimension has increased substantially the distribution
platform at EVBG.


Market-making and Trading

In 2003, EVBG made significant changes to our trading operation. In April a new
team was recruited to realign entirely the market-making direction, increasing
the number of stocks that we make prices in to over 600 by the year end. All our
market-making and trading activities across the mid and the small cap traded
profitably in 2003 and EVBG saw a significant increase in transaction volumes.

Market-making ensures the operation of an orderly and liquid market and provides
a service to retail stockbrokers. EVBG has been able to increase this part of
the business by adding further electronic connectivity via the Retail Service
Provider ("RSP") mechanism. At the year end, we were members of the London Stock
Exchange and Proquote hubs and have begun the process of adding a further two
RSP connections.

In summary, 2003 has seen EVBG's businesses develop significantly. I believe
that, as we approach the end of the first quarter of 2004, we are confident of
further income and profitability growth .


Christows

In 2003 we set a plan for Christows of growth in scale and attaining
profitability. I am pleased to report that both of these achievements were met.
Total income increased by over 25% to £8.3 million which, coupled with continued
tight management of costs, produced a second consecutive profitable year after
the restructuring in 2001. Transaction based income increased by 39% from 2002
and included an exceptional performance from our contracts for difference team
which doubled its income. Our strategy of growing funds under management,
particularly those strategic funds upon which recurring management fees are
received, also proved successful. Strategic funds under management increased by
59% over the previous period to £398m (2002: £250m) making up 83% of total funds
under management at the year end (2002: 77%).

Our growth in funds under management was underpinned by record sales, for the
third consecutive year, for our professional intermediary sales team, leading to
Christows winning new mandates to increase significantly year end funds under
management to approximately £477 million, an increase of 46% over last year.
Within our funds under management we have seen an extension of our offering to a
wider potential client base via our OEIC, Multi-Manager Portfolio Service and
the successful Private Portfolio Account, where we have seen further growth in
the average portfolio size of our bespoke discretionary clients. In addition, we
have been successful in recruiting likeminded individuals who can attract new
clients to supplement the organic growth from our sales activities, and have
been joined by new account executives from a variety of competitors.

During the middle part of the year, we continued our regional development by
opening a new branch office in Bath, which we strongly believe will have
considerable potential in 2004 and beyond. Finally, as the year came to a close,
we completed the process of repatriating our OEICs to the UK from Dublin, which
will allow our Fund Management team to utilise the flexibility introduced by the
new UCITS legislation to supplement the excellent performance of the funds last
year.

Christows begins 2004 with a robust, scaleable platform for growth and a
continuation of the trends apparent in the second half of 2003 should contribute
to accelerating profitability in the current year.


IP2IPO

IP2IPO operated as a subsidiary of the Group until October and during this
period concluded its third university Partnership, when in May 2003 it entered
into a 25 year partnership with King's College London. At this point, it raised
£6.25 million through a further round of private financing to develop this
relationship. In September 2003, IP2IPO agreed terms of a new 25 year
Partnership with the University of York's Centre for Novel Agricultural Products
("CNAP") which was conditional upon IP2IPO's admission to AIM.

In October 2003, IP2IPO successfully listed on AIM raising £31.5 million valuing
this group at £111.8 million. Since then it has continued to make progress in
the development of spin out companies from its on-going university partnerships.
At the time of the admission to AIM, the Group realised £15m from the sale of
its majority stake, leaving it with 40.61% of IP2IPO at the year end.

IP2IPO now operates as a separate independently managed business and the Group's
interest is monitored through the position of Non-executive director that I hold
on its board.


New Business

In August 2003, trading commenced in Evolution Securities China Limited ("ESCL
"). This company has its principal office in London and a branch in Shanghai. It
offers investment banking services to both Chinese and UK institutions and is
well placed strategically to access the growing Chinese equities market. ESCL
combines a deep knowledge of China, its economy and its securities industry with
first-class securities analysis, sales support and trade execution. ESCL aims to
meet the growing need from professional investors for attractive investment
opportunities in China at an acceptable level of risk. ESCL's integration within
the Group ensures that its corporate activities are efficient and well
supported. ESCL is an appointed representative of Evolution Beeson Gregory
Limited.


Official List  & New Offices

As outlined in the half year results, the Company completed the move to the
Official List on 26 June 2003.

The head office for the Group and its investment banking operations changed to
100 Wood Street in August 2003. The

facilities provided in this modern office, in the heart of the City of London,
has provided a strong platform for our trading and settlement operations and
brought us closer to our clients and institutional investors.

Both of these achievements were completed under tight timetables and cost
effectively.


Employees

We continue to recognise the importance of developing a culture where the
employees' interests are aligned mutually with those of the Group's
shareholders. This is something that we aim to achieve for the key performers in
all of our business units. Through the use of the Group's principal share and
share option schemes, we are able to manage this by combining staff
incentivisation with a high degree of loyalty. The use of such arrangements
resulted in a profit and loss impact across the Group during 2003 of £3.0
million, principally in the form of a charge for the cost of options (difference
between the market value of each 1p ordinary share and the exercise price at the
time of grant). It is our firm belief that these arrangements are extremely
effective and that incentivising and retaining our key employees are in the
interests of the Group's shareholders.


Alex Snow
Chief Executive Officer




CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the year ended 31 December

                                                                                             2003                 2002
                                                                                            £'000                £'000


Operating income                                                                           40,751               15,760
Commissions payable                                                                       (2,656)              (1,631)

Gross profit                                                                               38,095               14,129
Administrative expenses:
Administrative expenses before impairment of goodwill                                    (32,720)             (18,361)
Impairment of goodwill                                                                          -             (10,865)
                                                                                         (32,720)             (29,226)

Profit on sale of fixed asset investments                                                   2,379                   19
Profit on sale of current asset investments                                                    99                    -
Provision against fixed asset investments                                                 (6,114)              (9,712)


Group operating profit / (loss)                                                             1,739             (24,790)
Share of associated undertaking's operating loss                                            (186)                    -
Total operating profit / (loss)                                                             1,553             (24,790)

Profit on part sale of subsidiary                                                          15,085                    -
Interest receivable and similar income                                                      1,156                1,035
Share of associated undertaking's interest receivable                                         126                    -
Interest payable and similar charges                                                         (21)                 (15)

Profit / (loss) on ordinary activities before taxation                                     17,899             (23,770)


Tax on profit / (loss) on ordinary activities                                             (1,851)                (117)


Profit / (loss) on ordinary activities after taxation                                      16,048             (23,887)
Minority interest - equity                                                                    146                   51
Profit / (loss) for the financial year                                                     16,194             (23,836)

Dividends (0.25p per share, 2002: nil)                                                      (616)                    -


Retained profit / (loss) for the financial year                                            15,578             (23,836)


Basic earnings / (loss) per ordinary share                                                   6.7p              (13.7)p

Diluted earnings per share                                                                   6.3p                    -



All recognised gains and losses are included in the profit and loss account.


There is no difference between the result disclosed in the profit and loss
account and the result on a historical cost basis.




CONSOLIDATED BALANCE SHEET
As at 31 December


                                                                                             2003                  2002

                                                                                            £'000                 £'000
Fixed assets
Intangible assets                                                                           8,990                11,432
Investment in associated undertakings                                                      25,525                     -
Tangible assets                                                                             1,509                   973
Investments                                                                                   851                27,640
Own shares                                                                                    492                   484
                                                                                           37,367                40,529
Current assets
Debtors                                                                                    28,171                18,721
Long trading positions                                                                      7,207                 2,664
Investments                                                                                   444                   176
Cash at bank and in hand                                                                   53,705                31,988
                                                                                           89,527                53,549

Creditors: Amounts falling due within one year                                           (34,734)              (17,706)

Net current assets                                                                         54,793                35,843

Total assets less current liabilities                                                      92,160                76,372

Provisions for liabilities and charges                                                      (227)                 (396)

Net assets                                                                                 91,933                75,976



Capital and reserves
Called up share capital                                                                     2,478                 2,404
Shares to be issued                                                                             -                   508
Share premium account                                                                      25,739                23,892
Merger reserve                                                                             57,261                57,261
Profit and loss account                                                                     6,488              (12,053)

Total shareholders' funds                                                                  91,966                72,012

Shareholders' funds - Equity                                                               91,966                72,012

Minority interests - Equity                                                                  (33)                 3,964

Minority interests & shareholders' funds                                                   91,933                75,976






CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 December


                                                                                     2003                          2002
                                                                     £'000          £'000          £'000          £'000


Net cash inflow / (outflow) from operating                                         11,832                       (3,688)
activities

Returns on investments and servicing of
finance

Interest received                                                    1,159                         1,009
Interest paid                                                         (13)                          (14)
Income from fixed asset investments                                      8                             -

Net cash inflow from returns on investments                                         1,154                           995
and servicing of finance

Taxation
Corporation tax paid                                                                (979)                         (295)

Capital expenditure and financial investments
Purchase of investments                                            (2,649)                      (11,784)
Sale of investments                                                  2,611                           223
Purchase of tangible fixed assets                                  (1,353)                         (262)

Net cash outflow from capital expenditure and                                     (1,391)                      (11,823)
financial investments

Acquisitions and disposals
Part disposal of subsidiary                                         15,015                            36
Costs of disposal                                                  (1,616)                             -
Purchase of subsidiaries                                                 -                       (3,167)
Net cash (disposed) / acquired with                                (8,738)                        14,205
subsidiaries

Net cash inflow from acquisitions and
disposals
                                                                                    4,661                        11,074

Cash inflow / (outflow) before financing                                           15,277                       (3,737)

Financing
Issues of ordinary share capital                                     1,413                            32
Issue of shares to minorities                                        5,252                             -
Expenses of share issue                                              (225)                         (276)

Net cash inflow / (outflow) from financing                                          6,440                         (244)


Increase / (decrease) in cash in the year                                          21,717                       (3,981)



Adjusted operating profit

The statutory operating profit for the overall Group is as shown below. The
Board believes a truer reflection of the performance of the Group's on-going
operating businesses is afforded by the measure "adjusted operating profit".
This is calculated so as to exclude items from operating profit that are one-off
or non-recurring, are not part of the on-going business profitability or, in the
case of the cost of options and amortisation, represent non-cash items.


                                                                                31 December                 31 December
                                                                                       2003                        2002
                                                                      £'000           £'000       £'000           £'000
Operating profit / (loss)
                                                                                      1,553                    (24,790)

Items not included within "adjusted operating profit"
Profit on sale of fixed asset investments                           (2,379)                        (19)
Profit on sale of current asset investments                            (99)                           -
Provision against fixed asset investments                             6,114                       9,712
Adjustment for provisions and profits on investments                                  3,636                       9,693

Non-recurring costs                                                   1,113                       1,276
IP2IPO subsidiary operating loss                                        599                           -
Non-recurring items                                                                   1,712                       1,276

Amortisation                                                            567                         252
Share of associated undertaking's operating loss                        186                           -
Cost of options                                                       2,963                         166
Impairment of goodwill                                                    -                      10,865
Non-cash items                                                                        3,716                      11,283

Adjusted operating profit / (loss)                                                   10,617                     (2,538)




Other information

The financial information in this statement, which was approved by the Board of
Directors on 24 March 2004, has been prepared on the historical cost basis,
modified by the revaluation of certain assets held for trading purposes.  There
has been no change in accounting policies since the last annual report, as at 31
December 2002.  It does not constitute the Group's statutory accounts for the
year ended 31 December 2003 within the meaning of Section 240 of the Companies
Act 1985. The statutory accounts for 2003, on which the auditors anticipate
issuing an unqualified opinion, will be finalised on the basis of the financial
information presented by the Directors in this preliminary announcement, and
will be delivered to the Registrar of Companies following the Company's Annual
General Meeting.

The Group will be circulating the full annual report and accounts to
shareholders and copies will be available from the Registered Office of the
Company, 9th Floor, 100 Wood Street, London EC2V 7AN from the date of despatch
to shareholders for one month.


Annual General Meeting

The arrangements for, and notification of business to be transacted at, the
Company's Annual General Meeting will be provided in the annual report and
accounts to be circulated to shareholders in due course.




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