Interim Results

Netcentric Systems PLC
28 June 2002


NETCENTRIC SYSTEMS PLC

28 JUNE 2002



             NETCENTRIC SYSTEMS PLC ('Netcentric' or the 'Company')

             INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2002



CHAIRMAN'S STATEMENT



Dear Shareholder



You will be aware that, in October of last year, all the members of the previous
board of directors, with the exception of Gerard Thompson, resigned and that, on
22 October 2001, John May and I were appointed as directors.  The previous board
had considered a solvent liquidation of the Company, but abandoned this plan, at
our behest, as it would have produced no return to Shareholders.  As the new
Board, we proposed a rescue package, which has been implemented and involved
three measures and I am pleased to say that a great deal of progress has been
made in respect to these plans since our appointment.



Firstly a European development and sales licence was granted to a third party,
Netcentric Europe Limited ('NEL'), in relation to its Lychee(R) software product
which was also granted the use of the name 'Netcentric' for promotion and sales
purposes.  Second, steps were taken to conserve the Company's remaining cash
resources and to initiate a company voluntary arrangement ('CVA') for the
Company's principal operating subsidiary, Netcentric Systems (Europe) Limited ('
NSL'), which had accrued debts of £5,623,874 as at 30 September 2001, of which
£5,090,091 was owed to the Company.



Under the CVA, non-preferred creditors of NSL were offered 10p in the pound in
cash and 90p in the pound in shares of London & Boston Investments Plc ('L&Bi').
  The Company was unable to offer creditors its own Ordinary Shares, because the
market price of the Company's shares was below their nominal value which meant
that, under Isle of Man company law, Ordinary Shares could not be issued on an
appropriate basis.  Instead, the Company came to an arrangement with L&Bi (of
which John May and I are both directors and which holds 9.03 per cent. of the
existing Ordinary Capital of the Company) whereby L&Bi would issue its shares to
NSL's creditors as part of the CVA.  In return for the issue of its shares, L&Bi
agreed to take an assignment from the creditors of NSL amounts due to them by
NSL. The Company agreed to guarantee these debts. Accordingly, following the
implementation of the CVA, L&Bi has become a creditor of The Group in the sum of
£318,930, but has agreed, subject to shareholders' approval, to exchange this
debt for new Ordinary shares in the Company as part of the planned capital
re-organisation.



Thirdly, the Board has recently announced the next stage of its rescue plan for
the Company: a Capital Reorganisation and Capital Reduction, Allotment of
63,786,092 New Ordinary Shares to L&Bi in respect of the debt mentioned above,
the Grant of New Warrants and a Rule 9 Waiver all of which shareholders are
asked to vote on at an EGM called for 22 July 2002. Full details of these
proposals have been sent to shareholders with a notice convening an EGM.



Capital Reorganisation and Capital Reduction



As at 30 September 2001, the deficit on the Company's profit and loss account
stood at £13,023,000.  Isle of Man company law prohibits the payment of a
dividend while there is a deficit on a company's profit and loss account.



In order to solve this problem, under the Capital Reorganisation and subject to
Shareholders' approval, each Existing Ordinary Share of 5p will be divided into
one new ordinary share of 0.1p and one Deferred Share of 4.9p.  The new ordinary
shares will then be consolidated on a 1 for 5 basis to create New Ordinary
Shares of 0.5p each.  Each of the resulting New Ordinary Shares will have the
same rights as each Existing Ordinary Share. Under the Capital Reduction, it is
proposed, subject to Shareholders' approval, to apply to the court in the Isle
of Man to write off the Deferred Shares and thereby eliminate the bulk of the
deficit on the Company's profit and loss account. It is also proposed, subject
to Shareholders' approval, to write off the share premium account and the
capital redemption reserve.



Grant of New Warrants



As part of the arrangements for L&Bi to issue its shares in the CVA of NSL, it
was agreed that, subject to Shareholders' approval, 11,473,488 New Warrants
representing 10 per cent. of the Enlarged Issued Ordinary Share Capital would be
granted to L&Bi. In addition, it is proposed to issue 11,473,488 New Warrants to
Gerard Thompson, Teather & Greenwood and employees of the Company representing
in aggregate a further 10 per cent. of the Enlarged Issued Ordinary Share
Capital.  The Company has Existing Warrants, but these entitle the holder to
subscribe for Existing Ordinary Shares at 5p or more per share and so are
currently valueless.



Rule 9 Waiver



Under Rule 9 of the City Code on Takovers and Mergers, a body who, together with
persons acting in concert with it, acquires 30 per cent. or more of the rights
to vote at general meetings of a company, is required to make a general offer to
all Shareholders for the acquisition of their shares.  The effect of the
Conversion of Debt and the exercise of the New Warrants would be to give L&Bi
60.53 per cent. of the enlarged issued ordinary share capital and including
others acting in concert with L&Bi, 65.32 per cent.  Accordingly, with the
consent of the Panel on Takovers and Mergers, it is proposed to seek the
approval of Shareholders at the EGM to the waiver of the Rule 9 requirement.





Since L&Bi and those acting in concert with them (including Gerard Thompson)
will hold more than 50 per cent. of the Enlarged Issued Ordinary Share Capital,
they will be free to acquire any number of Ordinary Shares so as to increase
their percentage of voting rights without incurring any obligation under Rule 9
to make a general offer for the Company.



Independent Directors



We have appointed two independent directors, Paul Hughes and Emanuel Mond, as
part or our programme to prepare the Company for its future and I am very
pleased to welcome them to the Board. Their details are included in this
statement.



Financial Matters



During the period under review we have rationalised the affairs of the Company.
The property disclosed in the balance sheet as at 30 September 2001 at a value
of £1.76 million was sold at this revalued holding price (net of sales
expenses). This was a profit of £75,000 on historic cost as disclosed in the
notes to the accounts.



The reported loss in the period emanates significantly from the legal and
accountancy costs in rationalising the affairs of the Company, together with
ongoing running costs. The release of the provision for future losses of
£341,000 relates to the expenditure incurred in the development activities of
the group company, Netcentric Systems (Europe) Limited, prior to the cessation
of its development activities and therefore this amount has been written back.



Included in creditors in the Balance Sheet is an amount of £299,000 in relation
to amounts due to L&Bi at 31 March 2002, subsequently increased to £318,930 at
today's date. If this debt is converted the net assets of the Company would
increase to £445,000 as at the balance sheet date of 31 March 2002.



Current Trading and Prospects for the Company



As mentioned above, a licence has been granted in the Lychee product to NEL. NEL
has taken the base on which the product was created and added the necessary
'fixes' and enhancements. It is platform independent and therefore works
smoothly on virtually any operating system including Microsoft, Unix and Linux.
Lychee operates with industry standard databases including Oracle 8 and Oracle
9i, IBM DB2 and Microsoft SQL Server.  Lychee is in the process of being
accepted by content management users in the United Kingdom and plans to approach
users on the Continent will fall into place if Lychee becomes the content
management system of choice. The Company is considering other markets,
particularly the USA, and intends to arrange exploitation of them shortly. The
Company currently has a distribution and reseller agreement with Avatar Systems
Inc, a Dallas, Texas based Petro-software and internet application solutions
provider, quoted on the NASDAQ Bulletin Board. Under this agreement,  Avatar
Systems Inc agreed to distribute the Lychee software in the United States.



In regard to Lychee, the Company is dependent on the sales and marketing
expertise of NEL. Turnover by way of commissions earned from sales is not
expected to be substantial during calendar year 2002 in the UK and Europe.
Whilst the Directors estimate that the USA market represents a greater
opportunity for the Lychee product, it will also require additional resources
and time to develop properly.  The Directors would expect that USA commission
contributions would not be significant until calendar year 2003 and beyond. The
Directors are therefore currently considering ways to promote a closer
relationship with Avatar Systems Inc (of which I am a director) to help develop
sales of Lychee in the United States.



For the remainder of calendar year 2002 into the first quarter of 2003, the
Directors expect that commissions earned will not sustain the standing
overheads.  The Company therefore has announced that to generate additional
income, a reverse merger of another business into the Group will be sought.  The
Company will continue to collect in cash and liquid assets in preparation for
such a reverse takeover of a suitable business.



Independent Directors



Paul Martyn Hughes, Non Executive Director (aged 44)



Paul Hughes spent the first seventeen years of his career working for Lloyds
Bank plc in a management capacity dealing with graduate recruitment, training
management and providing management consultancy to major clients of the bank
including risk management. Since 1996 he has been the group managing director of
the Gadd Group (Development and Contracting Group) and is the non-executive
director of several companies including Peropa Limited, IR Flint Underwriting
Agencies Limited, David Yeomans Fabrics Limited, Metrodiner Limited and
Minsterstone Limited.



Emanuel Mond, Non Executive Director (aged 45)



Emanuel Mond qualified in 1981 as a solicitor. He initially pursued a legal
career, but latterly he has predominantly devoted his time to The Monis Group, a
leading supplier of asset finance and equity derivative libraries and
spreadsheet systems based in London and New York. The Monis Group has now become
one of the world's largest independent supplier of derivatives analytics,
supplying libraries, applications, data and services for analysing and managing
most derivatives. He has also invested at an early stage in a number of
technology, biotech and media related ventures.



Stephen A Komlosy

Chairman.




GROUP PROFIT AND LOSS ACCOUNT



FOR THE SIX MONTHS ENDED 31 MARCH 2002


                                    6 months ended 31    6 months ended 31           Year ended
                                            March 2002          March 2001    30 September 2001
                                            Unaudited            Unaudited              Audited
                                                               As restated
                                                £'000                £'000               £'000
TURNOVER

Continuing operations                              15                  466                 435
Discontinued operations                            17                  -                   557
                                                   ------------        ------------        ------------
TOTAL TURNOVER                                     32                  466                 992
                                                   ------------        ------------        ------------

OPERATING (LOSS)/PROFIT
Continuing operations                              (578)               (2,458)             (4,889)
                                                   ------------        ------------        ------------
                                                                       (2,458)             (4,889)
Discontinued operations                            11                  -                   191
                                                   ------------        ------------        ------------
                                                   (567)               (2,458)             (4,698)

Exceptional operating costs                        -                   (249)               (238)
                                                   ------------        ------------        ------------
TOTAL OPERATING LOSS                               (567)               (2,707)             (4,936)

Loss on disposal of subsidiary                     -                   (109)               (109)

Release of provision for future losses and fixed
asset write downs                                  341                 2,215               4,587
                                                   ------------        ------------        ------------
LOSS ON ORDINARY ACTIVITIES BEFORE INTEREST        (226)               (601)               (458)
Interest income                                    1                   66                  76
Interest payable and similar charges               (41)                (205)               (272)
                                                   ------------        ------------        ------------

LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION        (266)               (740)               (654)
Taxation                                           -                   -                   6
                                                   ------------        ------------        ------------
LOSS FOR THE YEAR                                  (266)               (740)               (648)
                                                   ------------        ------------        ------------


LOSS PER SHARE - BASIC                             (.10)p              (0.29)p             (0.25)p
                                                   ------------        ------------        ------------


STATEMENT OF GROUP TOTAL RECOGNISED GAINS AND LOSSES



FOR THE PERIOD ENDED 31 MARCH 2002


                                                           6 months ended   6 months ended   Year ended
                                                           31 March 2002    31 March 2001
                                                                                             30 September
                                                           Unaudited        Unaudited        2001

                                                                            As restated      Audited
                                                           £'000            £'000            £'000

Loss for the financial period                              (266)            (740)            (648)

Prior year adjustments                                     -                -                (8,190)
                                                           ---------        ---------        ---------
Total gains and losses recognised in the accounts since
the last annual report                                    (266)            (740)            (8,838)
                                                           ---------        ---------        ---------



NOTE OF GROUP HISTORICAL COST PROFIT AND LOSSES



FOR THE PERIOD ENDED 31 MARCH 2002


                                                           6 months ended   6 months ended   Year ended
                                                           31 March 2002    31 March 2001    30 September
                                                           Unaudited        Unaudited        2001
                                                                            As restated      Audited
                                                           £'000            £'000            £'000


Loss on ordinary activities before taxation               (266)            (740)            (654)

Realisation of property revaluation gains of previous
years                                                      75               -                14
                                                           ---------        ---------        ---------
Historical cost loss on ordinary activities before
taxation                                                  (191)            (740)            (640)
                                                           ---------        ---------        ---------

Historical cost loss on ordinary activities after taxation (191)            (740)            (634)
                                                           ---------        ---------        ---------




GROUP BALANCE SHEET



AS AT 31 MARCH 2002


                                                          6 months ended 31 6 months ended    31 Year ended
                                                          March 2002        March 2001     30 September 2001
                                                          Unaudited         Unaudited                Audited
                                                                            As restated
                                                          £'000             £'000             £'000


FIXED ASSETS
Intangible assets                                         -                 -                 -
Tangible assets                                           -                 4,092             1,760
Investments                                               103               150               -
                                                          ---------         ---------         ---------
                                                                            4,242             1,760
CURRENT ASSETS
Debtors                                                   431               668               494
Cash at bank                                              158               1,029             747
                                                          ---------         ---------         ---------
                                                          589               1,697             1,241


CREDITORS: amounts falling due within one year            (546)             (1,520)           (2,248)
                                                          ---------         ---------         ---------
NET CURRENT ASSETS/(LIABILITIES)                          43                177               (1,007)
                                                          ---------         ---------         ---------
TOTAL ASSETS LESS CURRENT LIABILITIES                     146               4,419             753

CREDITORS: amounts falling due after more than one year   -                 (1,312)           -

PROVISIONS                                                -                 (2,713)           (341)
                                                          ---------         ---------         ---------
NET ASSETS                                                146               394               412
                                                          ---------         ---------         ---------
Represented by:



CAPITAL AND RESERVES
Called up share capital                                   12,737            12,737            12,737
Reserves                                                  (12,591)          (12,343)          (12,325)
                                                          ---------         ---------         ---------
SHAREHOLDERS' FUNDS                                       146               394               412
                                                          ---------         ---------         ---------




NOTES TO THE INTERIM ACCOUNTS



RESERVES


                                                      Capital
                                                      redemption   Revaluation     Profit
                                         Share        reserve      reserve         and loss
Year ended 30 September 2001             premium      £'000        £'000           account         Total
                                         £'000                                     £'000           £'000


At 1 October 2000 as restated            283          279          514             (12,314)        (11,238)
Loss for the period                      -            -            -               (648)           (648)
Revaluation during the period            -            -            (439)           -               (439)
                                         --------     --------     --------        -------         --------
At 30 September 2001                     283          279          75              (12,962)        (12,325)
                                         --------     --------     --------        -------         --------

                                                      Capital
                                                      redemption   Revaluation     Profit
                                         Share        reserve      reserve         and loss
Period ended 31 March 2001               premium      £'000        £'000           account         Total
                                         £'000                                     £'000           £'000


At 1 October 2000 as restated            283          279          514             (12,314)        (11,238)
Loss for the period                      -            -            -               (740)           (740)
Revaluation during the period            -            -            (365)           -               (365)
                                         --------     --------     --------        -------         --------
At 31 March 2001                         283          279          149             (13,054)        (12,343)
                                         --------     --------     --------        -------         --------

                                                      Capital
                                                     redemption   Revaluation     Profit
                                         Share        reserve      reserve         and loss
Period ended 31 March 2002               premium      £'000        £'000           account         Total
                                         £'000                                     £'000           £'000


At 1 October 2001                        283          279          75              (12,962)        (12,325)
Loss for the period                      -            -            -               (266)           (266)
Disposal in the period                   -            -            (75)            75              -
                                         --------     --------     --------        -------         --------
At 31 March 2002                         283          279          -               (13,153)        (12,591)
                                         --------     --------     --------        -------         --------





LOSS PER SHARE
                                                   6 months ended 31   6 months ended 31   Year ended
                                                   March 2002          March 2001    30 September 2001
                                                   Unaudited           Unaudited              Audited
                                                                       As restated
                                                   £'000               £'000               £'000

Basic loss after taxation                          (266)               (740)               (648)
                                                   -----------         -----------         -----------

                                                   No.                 No.                 No.


Weighted number of shares in issue                 254,743,956         254,743,956         254,743,956
                                                   -----------         -----------         -----------



1. The interim financial statements have been prepared on the basis of the
accounting policies as set out in the Statutory Financial Statement for the year
ended 30 September 2001.



2. The comparative figures for the six months ended 31 March 2001 have been
restated to reflect the prior year adjustment disclosed in the accounts for the
year ended 30 September 2001.



3. The release of the provision for future losses of £341,000 relates to the
expenditure incurred in the development activities of the group company,
Netcentric Systems (Europe) Limited, prior to the cessation its development
activities.





END



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