Interim Results

Treatt PLC
21 May 2001


TREATT PLC
INTERIM STATEMENT

For the six months ended 31 March 2001

Treatt PLC, the manufacturer and supplier of flavour and fragrance
ingredients, primarily from essential oils, announces today its interim
results for the six months ended 31 March 2001. 

SUMMARY

* Group turnover increased by 11% to £13,489,000 (2000: £12,113,000)

* Profit before tax increased by 7% to  £1,312,000 (2000:£1,227,000)

* Earnings per share increased by 5% to 9.2p (2000: 8.8p) 

* Interim dividend increased by 4% to 2.6p (2000:2.5p) 

* Net assets per share increased by 10% to £1.58 (2000:£1.44) 


For further information please contact:

Treatt PLC                                                      01284 702500
Hugo Bovill, Managing Director
Mark Bottjer, Finance Director

GCI Financial                                                   020 7398 0800
Margaret Jervoise/Richard Sunderland


CHAIRMAN'S STATEMENT

The six months to 31 March 2001 have again been satisfactory, with Group
turnover increasing 11 per cent to £13,489,000 (2000: £12,113,000) and profit
before tax continuing to grow at 7 per cent to £1,312,000 (2000: £1,227,000).
Earnings per share have consequently increased to 9.2 pence per share (2000:
8.8 pence per share). The Board has declared a 4% increase in the interim
dividend to 2.6 pence per share (2000:2.5 pence per share) which is payable on
4 October 2001 to all Shareholders on the register at close of business on 7
September 2001.

These improved results reflect a continuation in our good performance at
Florida Treatt, with sales growing 20 per cent over last year, though we
remain cautious about the full year result as there may be some impact from
any US economic slowdown. Sales growth at R.C. Treatt continued at a rate of 8
per cent, which was largely fuelled by increased activity in our aroma
chemical distribution business. 

In the Chairman's December statement we referred to lower sales of essential
oils in the second half of last year to some of our major customers, as a
result of the Millennium effect. We are pleased to report that activity levels
with these customers are now running satisfactorily. 

The Group continues to invest heavily in IT systems and infrastructure, in
order to facilitate future growth. As reported in December, our Customer
Relationship Management Systems will be fully implemented in the second half
of this year. In support of our growing business in Florida and the continuing
importance of the North American market, we have negotiated the purchase of a
larger freehold facility together with an adjacent 5 acres of land for US $2.1
million. The site is at Lakeland and is close to our existing premises. We
currently await the outcome of due diligence but expect to complete the
purchase at the end of June. Relocation and renovation work will then commence
at an expected cost of US $3.1 million, with all such costs being capitalised.
To help fund this project we plan to raise approximately US $5 million from
Variable Rate Demand Bonds, which bear interest at below US prime rates. These
investments will significantly increase the amount of depreciation charged
against results over the coming years, however the useful lives attached to
these assets are currently being reviewed.

The Group's balance sheet strengthened further with net assets per share of
£1.58. Based upon our current projections the operations will remain cash
generative during the second half of the year.

The Future   
The Group's order book remains healthy as trading to date continues to
outperform last year. As previously stated there has been significant
consolidation in the flavour and fragrance industry and we still await the
outcome of these changes. We face a particularly demanding period ahead, with
the introduction of new IT systems and the investment in a new Florida
facility, but we face these challenges with confidence as we continue to build
our business.
 
Edward Dawnay
Chairman
21 May 2001 



GROUP PROFIT AND LOSS ACCOUNT


                        Six months ended    Six months ended      Year ended
                        31 March            31 March              30 September
                        2001                2000                  2000
                       (Unaudited)         (Unaudited)           (Audited)


            Notes      £'000               £'000                 £'000


Turnover        3     13,489              12,113                24,137 
Cost of Sales         (9,483)             (8,325)              (16,188)
                      ______               ______               ______
Gross profit           4,006               3,788                 7,949 


Net operating 
costs                 (2,667)             (2,531)               (5,184)
                      ______               ______               ______
Operating 
profit                 1,339               1,257                 2,765 

Net interest 
payable and 
similar charges          (27)                (30)                  (42)
                      ______               ______               ______

Profit on 
ordinary 
activities 
before taxation        1,312               1,227                 2,723 



Tax on profit 
on ordinary 
activities      5       (380)               (338)                 (782)
                      ______               ______                ______

Profit on 
ordinary 
activities 
after taxation           932                 889                 1,941 

Dividends               (263)               (251)                 (786)
                      ______               ______                ______
Transfer to 
reserves                 669                 638                 1,155 
                      ______               ______                ______


Dividends per 
share                    2.6p                2.5p                  7.8p

Earnings per 
share

-  Basic        6        9.2p                8.8p                 19.3p


-  Fully Diluted6        9.2p                8.8p                 19.1p




GROUP BALANCE SHEET

                        As at               As at                 As at
                       31 March             31 March              30 September
                         2001                2000                  2000
                        (Unaudited)         (Unaudited)           (Audited)

                        £'000               £'000                 £'000


Tangible fixed assets   5,949               5,215                 5,831 


Current assets

    Stocks              8,230               8,456                 9,275 

    Debtors             5,212               4,570                 4,384 

    Cash at bank          684                 380                   169 
                       ______              ______                ______

                       14,126              13,406                13,828 

Creditors: amounts falling due in one year

    Bank overdrafts      (251)                  -                  (428)

    Other creditors    (3,670)             (4,072)               (3,862)
                       ______              ______                ______
                       (3,921)             (4,072)               (4,290)
                       ______              ______                ______

Net current assets     10,205               9,334                 9,538 



Total assets less 
current liabilities    16,154              14,549                15,369 


Deferred taxation        (147)                (37)                 (147)
                       ______              ______                ______
Net assets             16,007              14,512                15,222 
                       ______              ______                ______


Share capital           1,010               1,008                 1,008 

Share premium account   1,963               1,929                 1,929 

Profit and loss 
account                13,034              11,575                12,285 
                       ______              ______                ______
Shareholders' funds    16,007              14,512                15,222 
                       ______              ______                ______


The financial information set out in this document does not constitute
statutory accounts within the meaning of the Companies Act 1985.  The figures
for the year ended 30 September 2000 are an abridged version of the Group's
audited financial statements which have been delivered to the Registrar of
Companies.  These statements received an unqualified audit opinion.  The
figures for the six months ended 31 March 2001 and 2000 are unaudited.  This
interim report was approved by the Board on 18 May 2001.



GROUP CASH FLOW STATEMENT

                        Six months ended    Six months ended      Year ended
                        31 March            31 March              30 September
                        2001                2000                  2000
                       (Unaudited)         (Unaudited)           (Audited)
            

            Notes       £'000               £'000                 £'000



Cash inflow 
from operating 
activities      1       1,525                 183                 1,364 


Returns on 
investments and 
servicing of 
finance                   (27)                (30)                  (42)


Taxation                 (215)               (210)                 (736)


Capital expenditure 
and financial investment (403)               (341)               (1,129)


Equity dividends paid    (251)               (221)                 (715)
                       ______              ______                ______

Cash inflow/(outflow) 
before financing          629                (619)               (1,258)


Financing  
-  Repayment 
   of debt      2           -                (710)                 (710)


-  Issue of 
   ordinary 
   share 
   capital                 36                   -                     -
                      ______                ______               ______
Increase/
(decrease) 
in cash in 
the period      2         665              (1,329)               (1,968)
                      ______                ______               ______



Notes

(1) Reconciliation of operating profit to cash inflow from operating          
activities


   Operating profit      1,339               1,257                2,765 

   Depreciation charges    275                 264                  551 

Net increase in working 
capital and other items    (89)             (1,338)              (1,952)
                        ______              ______               ______

Cash inflow from 
operating activities     1,525                 183                1,364 
                        ______              ______               ______


(2)Reconciliation of net cash flow to increase in funds


Increase/(decrease) in 
funds in the period        665              (1,329)              (1,968)

Cash outflow from 
repayment of bank loans      -                 710                  710 

Exchange and other non-cash 
movements                   26                  20                   20 
                        ______              ______               ______

Increase/(decrease) in 
net funds in the period    691                (599)              (1,238)

Net funds at 
1 October 2000           (259)                 979                  979 
                        ______              ______               ______

Net funds at 
31 March 2001             432                  380                 (259)
                        ______              ______               ______


NOTES TO THE INTERIM STATEMENT


                         Six months ended     Six months ended    Year ended
                         31 March             31 March            30 September
                         2001                 2000                2000
                        (Unaudited)          (Unaudited)         (Audited)


                        £'000                £'000               £'000

(3) Turnover by 
    destination

United Kingdom          3,416                3,159               6,506 


Rest of Europe          3,587                3,002               6,214


The Americas            3,763                3,233               6,032 


Rest of the World       2,723                2,719               5,385 
                       ______               ______              ______
                       13,489               12,113              24,137 
                       ______               ______              ______



(4)Statement of recognised gains and losses


Profit for the period 
before dividends         932                    890              1,941 

Currency translation 
differences on foreign 
currency net investments  80                    116                309 
                      ______                 ______              ______

Total recognised 
gains and losses       1,012                  1,006              2,250 
                      ______                 ______              ______



(5) Taxation has been provided at 29.0 per cent (2000: 27.5 per cent) which is
the effective group rate currently anticipated for the financial year ending
30 September 2001.



(6) (a) Basic earnings per share for the six months ended 31 March 2001 are
based on the weighted average number of shares in issue in the period of
10,078,298 (2000: 10,077,749) and earnings of £932,000 (2000: £890,000) being
the profit on ordinary activities after taxation.


(b) Fully diluted earnings per share for the six months ended 31 March 2001
are based on the weighted average number of shares in issue in the period,
adjusted for the effects of all dilutive potential ordinary shares of
10,133,107 (2000: 10,132,708) and the same earnings as above.


BACKGROUND NOTE

Price:217.5p(18th May 2001)     No. of Shares in issue: 10,102,749            

Market Cap: £22m

The business
Treatt is a supplier of ingredients to the flavour and fragrance industry. 
These ingredients are included by Treatt's customers as part of a flavour or
fragrance which may then be manufactured from a concentrated mixture of
hundreds of different ingredients.

The ingredients Treatt supply are mainly based on essential oils which are
distilled or blended.  There is an infinite number of potential variations of
each of these as a result of different origins and production techniques. 
Aromatic chemicals, and a range of TreattaromeTM natural distillates
manufactured from the named food, are also supplied.  Typical products
including a Treatt ingredient could range from air fresheners, cosmetics,
shampoos and soaps to soft drinks, confectionery and basic pharmaceutical
products.  Treatt is a world leader in the supply of essential oils for these
uses.  Customers range from small companies to large multinationals, including
flavour and fragrance creators as well as consumer products manufacturers.

There are hundreds of different essential oils extracted from many different
botanical materials.  Some examples of common oils are peppermint, lime,
lavender, orange and eucalyptus.  Essential oils have been used as flavour and
fragrance ingredients for centuries and their use for this purpose far
outweighs other uses such as aromatherapy.  

The vast majority of turnover from the Group's U.K. subsidiary R.C. Treatt
consists of export sales.  The Florida Treatt subsidiary sells primarily into
the U.S. market.



Strengths
* Industry-leading new product development and service is maintained through
the company's on-going investment in R&D.
* Treatt is able to source rare and exotic essential oils from around the
world and export flavour and fragrance ingredients to over 80 countries.
* The finest quality raw materials are obtained and the highest standards of
production are maintained through direct working relationships with growers
and producers.
* Customers demands, large and small, can be met at extremely short notice
through Treatt's extensive stockholding of flavour and fragrance raw
materials.
* Consistent product quality, regardless of variations resulting from source,
climate or production technique, is ensured through Treatt's expertise in
blending and distilling essential oils.


Key financial highlights (year end = 30 September)

                          2000       1999       1998       1997       1996    
  
Pre tax profit (£m)       2.72       2.57       2.17       1.56       1.46    
  
Turnover (£m)             24.1       22.4       22.1       22.6       29.4    
  
EPS (p)                   19.3       18.5       15.6       10.5       10.7