Interim Management Statement

12 May 2011

LMS Capital plc

Interim Management Statement

LMS Capital plc ("the Company" or "LMS Capital"), the investment company with
experience in private equity and development capital investment, is holding its
Annual General Meeting today and the Board is pleased to present the Company's
Interim Management Statement which relates to the period from 1 January 2011 to
11 May 2011.

The most significant recent developments and financial highlights were as
follows:

  * Net Asset Value per share was 90 pence as at 31 March 2011, unchanged from
    31 December 2010;
   
  * Continued refined strategic focus for the Company with realisations from
    CopperEye Limited and Kizoom Limited. We also sold 80% of our 2010 year end
    holding of shares in Gulfmark Offshore for proceeds of £5.0 million and a
    net gain of £1.0 million;
   
  * The offer for ProStrakan Group plc completed on 21 April and resulted in
    cash proceeds to the Company of £22.9 million, a gain of approximately £4.8
    million over our carrying value at the end of 2010.
   
Glenn Payne, Chief Executive of LMS Capital, commented: "Today's update
demonstrates our continued focus and execution of our refined strategy outlined
last year. With the sale of our legacy holdings and the realisation of funds we
expect to have the financial resources to acquire profitable and growing
companies. Our acquisition efforts are ongoing both for new portfolio holdings
and add-on investments for our existing direct holdings. Our strategy is
resonating with a number of stakeholders and we are confident that we can
continue to make value enhancing purchases."

Recent developments - good progress since the year end

The Net Asset Value per share was 90 pence as at 31 March 2011, unchanged from
31 December 2010. Valuation improvements on our quoted and fund holdings were
offset by unrealised currency losses as the US dollar weakened against
Sterling. By the end of April, further weakening of the US dollar coupled with
price falls on our larger quoted holdings (principally Weatherford) had reduced
this to 87 pence per share.

Over the period we continued our refined strategic focus for the Company with
further disposals of underperforming older investments and since the beginning
of 2011 we have disposed of our interests in CopperEye Limited and Kizoom
Limited. These disposals had no significant impact on the Company's Net Asset
Value (following earlier write-downs on these investments) but release
management resources to focus on our more profitable and growing investments.

In line with our corporate strategy to liquidate our fund of funds we have made
no new commitments to funds. At 31 March 2011 our outstanding commitments to
funds were £34.1 million, a reduction of £6.6 million from £40.7 million at the
end of 2010. We have also begun the process of exploring the sale of certain
fund positions in the secondary market.

The offer for ProStrakan Group plc completed on 21 April and resulted in cash
proceeds to the Company of £22.9 million, a gain of approximately £4.8 million
over our carrying value at the end of 2010. We have also sold 80% of our 2010
year end holding of shares in Gulfmark Offshore for proceeds of £5.0 million
and a net gain of £1.0 million. We continue to monitor the prices of all our
quoted holdings and expect to realise the remainder in due course.

With the sale of our legacy holdings and the realisation of funds we expect to
have the financial resources to acquire profitable and growing companies. Our
acquisition efforts are ongoing both for new portfolio holdings and add-on
investments for our existing direct holdings. Our strategy is resonating with a
number of stakeholders and we are confident that we can continue to make value
enhancing purchases.

Principal direct Investments - strong momentum within the portfolio

Our investee companies have all made good progress. An update on each to 31
March 2011 is as follows:

  * Updata continues to perform strongly with revenues for the first quarter
    approximately 20% ahead of the same period last year;
   
  * Apogee is performing in line with expectations and revenues are 8% ahead of
    the prior year;
   
  * NEP continues to perform in line with our expectations, with revenues 15%
    ahead of the first quarter last year and a large pipeline of potential new
    retail electric accounts;
   
  * Method: revenues for the first quarter are slightly behind last year but 5%
    ahead of budget. Sales of hand, skin and surface cleaners are on track to
    grow 20% year on year;
   
  * YesTo is trading strongly with revenues 36% ahead of the corresponding
    period last year. It is now the number 2 in the natural skin care category
    and was successfully introduced into Walmart;
   
  * LuxuryLink is trading profitably and adding new online travel customers;
    revenues are 16% ahead of last year;
   
  * Zoom appointed a new CEO, is adding new accounts and is now number 2 in the
    non-prescriptive eyeglass category. Although revenues are behind last year
    they are slightly ahead of budget;
   
  * Penguin's sales continue to reflect increasing demand for cloud and high
    performance computing power. Revenues are behind last year's exceptional
    first quarter but 40% higher than budget;
   
  * Wesupply is now trading profitably after moving into profit for the first
    time in the fourth quarter of 2010. Revenues are 5% higher than last year's
    first quarter;
   
  * Entuity has achieved revenues significantly ahead of last year and 14%
    ahead of budget;
   
  * ITS continued to experience difficult trading conditions and we are
    currently reviewing the strategic options for this business.
   
Financial information

The Company's unaudited Net Asset Value per share at 31 March 2011 was 90
pence, unchanged from 31 December 2010. In the first quarter, unrealised
foreign currency losses offset valuation improvements of our quoted and fund
interests. At the end of April, Net Asset Value per share was an estimated 87
pence, reflecting price falls on our quoted holdings (principally Weatherford)
and further weakening of the US dollar against Sterling.

The carrying value of the portfolio at 31 March 2011 is based on the valuation
of the Company's investment portfolio as at 31 December 2010 with adjustments
for transactions in the three months ended 31 March 2011 including price
movements on quoted securities, movements in foreign currency exchange rates,
cash calls and distributions from funds and purchases and sales of quoted and
unquoted securities. In addition, where the Company has invested further
amounts to meet working capital requirements in its existing unquoted
portfolio, such amounts have been written off as fair value adjustments in the
period. The next full valuation of the portfolio will be for our half year
results as at 30 June 2011.

The Company's investment portfolio at 31 March 2011 (and 31 December 2010) was
as follows:

                      31 March 2011           31 December 2010 
                                                               
                        £'000        %           £'000        %
                                                               
US                                                             
                                                               
Quoted                 37,029      14%          42,122      17%
                                                               
Unquoted               32,946      13%          34,031      13%
                                                               
Funds                  78,655      31%          79,371      31%
                                                               
US total              148,630      58%         155,524      61%
                                                               
UK                                                             
                                                               
Quoted                 24,947      10%          21,091       8%
                                                               
Unquoted               41,361      16%          41,361      17%
                                                               
Funds                  41,401      16%          35,164      14%
                                                               
UK total              107,709      42%          97,616      39%
                                                               
Total                 256,339     100%         253,140     100%

Details of our largest investments by valuation at 31 March 2011, representing
about 72% of the total portfolio, are set out in the appendix to this
statement.

During the three months ended 31 March 2011 total funds invested by the Company
were £8.9 million in unquoted securities and to meet fund calls. Proceeds from
fund distributions were £2.5 million and from sales of quoted holdings £5.0
million.

At 31 March 2011 the Company had net debt of £8.3 million; adjusting for
receipt of the ProStrakan proceeds referred to above gives a pro forma end
March net cash position of £14.6 million. In April we extended our £15 million
facility with Royal Bank of Scotland until 30 September 2011.

This statement is a general description of the financial position and
performance of the Company for the period from 1 January 2011 to 11 May 2011.
It does not contain any profit forecast or forward looking information. Future
performance and share price is likely to be affected by a number of factors,
including (but not limited to) general economic and market conditions and
specific factors affecting the financial performance or prospects of individual
investments within the Company's portfolio.

For further information please contact:

LMS Capital plc 020 7935 3555

Glenn Payne, Chief Executive Officer

Tony Sweet, Chief Financial Officer

J.P. Morgan Cazenove Limited 020 7588 2828

Michael Wentworth-Stanley

Brunswick Group LLP 020 7404 5959

Simon Sporborg

Leonora Burtenshaw

Notes to Editors

LMS Capital is an investment company with experience in private equity and
development capital investment. Our objective is to deliver superior returns
for shareholders through ownership of controlling stakes or positions of
influence in profitable and growing companies run by experienced managers
operating in sectors we know and where we expect to be able to add value. We
aim to own companies and make follow-on investments in companies that will
produce profits that contribute to an increasingly valuable and profitable LMS
Capital. Our focus is on investing in high quality management teams and
companies at favourable prices. We will continue to be cautious in our
investment approach, aiming to grow our investments (and NAV) by 15%+ per annum
without undue risk or investing in unproven businesses.

LMS Capital plc Appendix

Interim management statement - 12 May 2011

The Company's principal investments by valuation at 31 March 2011 were as
follows:

Name                    Geography         Sector          Date of    Book 
                                                          initial   value 
                                                         investment       
                                                                     £'m  
                                                                          
Quoted investments                                                        
                                                                          
Weatherford                 US     Energy                   1984      28.8
International                                                             
                                                                          
Prostrakan Group plc        UK     Pharmaceuticals          1999      22.8
                                                                          
Chyron Corporation          US     Media/technology         1995       3.8
                                                                          
Direct investments                                                        
                                                                          
Method Products*            US     Consumer                 2004      17.2
                                                                          
Updata Infrastructure       UK     Technology               2009      14.0
UK                                                                        
                                                                          
HealthTech Holdings         US     Technology               2007      12.2
                                                                          
Nationwide Energy           US     Energy                   2010       9.3
Partners                                                                  
                                                                          
Rave Reviews Cinemas        US     Consumer                 2002       7.1
                                                                          
Apogee Group                UK     Technology               2010       8.7
                                                                          
Penguin Computing*          US     Technology               2004       6.9
                                                                          
Entuity                     UK     Technology               2000       5.5
                                                                          
Fund investments                                                          
                                                                          
Brockton Capital            UK     Property                 2006      14.5
                                                                          
BV Investment Partners      US     Buyouts                  1996      10.2
                                                                          
Scottish Equity             UK     Technology               2001       6.9
Partners                                                                  
                                                                          
Amadeus Capital             UK     Venture Capital          1998       4.6
Partners                                                                  
                                                                          
Spectrum Equity             US     Technology               1999       4.5
Investors                                                                 
                                                                          
Brynwood Partners           US     Consumer                 2004       3.1
                                                                          
Cadent Energy Partners      US     Energy                   2005       3.1
                                                                          
Weber Capital               US     Post-IPO technology      1999       2.7
                                   companies                              

*San Francisco Equity Partners manages these investments.