Interim Results

SOFTWARE RADIO TECHNOLOGY PLC                         

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2006

Chairman's statement

The first half of the financial year has seen SRT progress from a primary focus
on technology and product development to a greater emphasis on providing
support to customers to enable them to enter production. Meanwhile our target
markets have continued to grow strongly. As indicated in our preliminary
announcement on 15 June 2006, we have established our SRT Marine business as a
separate trading division.

Professional Mobile Radio - TETRA

Most of our TETRA customers are now in various stages of pre-production and
field-testing ahead of the commencement of full production. This work has
resulted in various type and interoperability approvals being obtained by SRT
and its customers for their products.

During this period of intensive customer support and testing, certain
software-related issues have arisen. We anticipate that these issues, whilst
resolvable, will result in up to six months' delay to our customers being able
to enter volume production of handsets and therefore a corresponding delay in
the generation of royalties for SRT.

The strength of the demand for our customers' products going forward is clearer
than ever with active trials taking place with various authorities in China
(including the Air Force), South Korea and elsewhere in Asia. The decision to
adopt TETRA has been made in these countries and the Board believes that SRT's
customers are well placed to become major handset suppliers in those markets
given the preference for local supply of homeland security-related products. We
therefore expect royalties to commence during 2007 as customers enter volume
production.

AIS-Marine

We believe our Marine business offers a substantial opportunity. Significant
progress has been made within the business which has now started generating
revenues.

During the last six months, SRT has successfully completed the development of,
obtained type approval for and launched a low cost AIS transponder for leisure
and small commercial vessels. A modified version for use on buoys is planned to
be launched in the first half of 2007. In parallel we have increased sales and
marketing resources and are now building a substantial customer base which
already numbers 15 companies, including some of the largest marine electronic
companies in the world. SRT is now working with authorities around the world,
including the Royal National Lifeboat Institution, the UK Maritime and
Coastguard Agency and the US Coastguard, which are all actively considering the
extension of existing AIS mandates to encompass smaller vessels.

With the launch of products by our customers and their preferential access to
their local markets, SRT has commenced a number of discussions with possible
strategic partners to further exploit available sales channels.

Results

Revenues for the six months were £843,000 (2005: £1.22 million). The fall in
revenue was primarily due to a lower level of income recognition of licence and
development fees from TETRA contracts. AIS Class B marine revenues commenced
during the period and totalled £148,000 and are expected to accelerate during
the second half.

Financing

In June 2006 SRT raised £4.05 million (net) to support additional investment in
both the TETRA and marine businesses. As at 30 September, the Company had net
cash of £2.68 million. Also, fixed licence and development fee payments of £3.0
million are due from customers over the next 12 months in addition to the
anticipated royalties.

Whilst the last six months has seen an increase in costs due to the additional
support provided to customers, this has not resulted in a long term increase in
the Company's overhead which remains in line with our business model.

Management

Shamus Kelly, Managing Director, is leaving the Company for family reasons with
effect from today. Shamus will be succeeded by Simon Tucker, Commercial
Director who has been appointed interim Managing Director. The Board intends to
recruit a permanent Managing Director to lead the Company through its next
stage of development.

Outlook

The software issues referred to above will result in royalty revenues which
were forecast for the current financial year being pushed back into 2007/8. As
a result, SRT will not achieve profitability during the current financial year.

The Board remains confident of the medium and long term prospects for the group
and that the additional investment in development and customer support this
year will be reflected in substantial revenue growth during 2007/8.

In summary SRT continues to make progress in both its TETRA and Marine
businesses, investing heavily in the technologies and customers in order to
secure revenues for the future. The Company has started generating revenues
from products being sold around the world which contain its reference designs
and we expect this to accelerate.


CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE 6 MONTHS ENDED 30 SEPTEMBER 2006

                               Six months   Six months   Six months   Six months
                                    ended        ended        ended        ended
                                  30 Sept      30 Sept      30 Sept      30 Sept
                                     2006         2006         2006         2005
                                Unaudited  Exceptional        Total    Unaudited
                                             Unaudited    Unaudited             
                                        £            £            £            £
                                                                                
Turnover                          842,579            -      842,579    1,220,267
                                                                                
Cost of sales                   (601,855)            -    (601,855)    (741,515)
                                                                                
Gross profit                      240,724            -      240,724      478,752
                                                                                
Administrative expenses       (1,434,112)    (201,916)  (1,636,028)  (1,029,185)
                                                                                
Loss on ordinary activities   (1,193,388)    (201,916)  (1,395,304)    (550,433)
before interest                                                                 
                                                                                
Other interest receivable          46,940            -       46,940        4,640
and similar income                                                              
                                                                                
Interest payable and similar            -            -            -     (11,484)
charges                                                                         
                                                                                
Loss on ordinary activities   (1,146,448)    (201,916)  (1,348,364)    (557,277)
before taxation                                                                 
                                                                                
Tax on loss on ordinary                 -            -            -      160,524
activities                                                                      
                                                                                
Loss on ordinary activities   (1,146,448)    (201,916)  (1,348,364)    (396,753)
after taxation                                                                  
                                                                                
Loss per share (basic and                                   (1.83)p      (0.79)p
diluted)                                                                        

The profit and loss account has been prepared on the basis that all operations
are continuing operations.

There are no other recognised gains or losses other than those passing through
the profit and loss account.


CONSOLIDATED BALANCE SHEET
AS AT 30 SEPTEMBER 2006

                                                      Six months     Six months
                                                           ended          ended
                                                         30 Sept        30 Sept
                                                            2006           2005
                                                       Unaudited      Unaudited
                                                               £              £
   Fixed Assets                                                                
                                                                               
   Intangible assets                                   3,941,790      2,157,310
                                                                               
   Tangible assets                                       510,854        335,477
                                                                               
                                                       4,452,644      2,492,787
                                                                               
   Current Assets                                                              
                                                                               
   Stocks                                                240,807         23,496
                                                                               
   Debtors                                             2,284,865      1,267,614
                                                                               
   Cash at bank and in hand                            2,682,088         40,776
                                                                               
                                                       5,207,760      1,331,886
                                                                               
   Creditors: amounts falling due within one         (1,032,598)    (1,400,696)
   year, including convertible debt                                            
                                                                               
   Net current assets/(liabilities)                    4,175,162       (68,810)
                                                                               
   Total assets less current liabilities               8,627,806      2,423,977
                                                                               
   Creditors: amounts falling due after more than              -      (447,558)
   one year, including convertible debt                                        
                                                                               
                                                       8,627,806      1,976,419
                                                                               
   Capital and reserves                                                        
                                                                               
   Called up share capital                                78,088         12,520
                                                                               
   Share premium account                               7,702,858              -
                                                                               
   Other reserves                                      5,724,512      5,458,343
                                                                               
   Profit and loss account                           (4,877,652)    (3,494,444)
                                                                               
                                                       8,627,806      1,976,419


CONSOLIDATED CASH FLOW STATEMENT
FOR 6 MONTHS ENDED 30 SEPTEMBER 2006

                                                         30 Sept        30 Sept
                                                            2006           2005
                                                       Unaudited      Unaudited
                                                               £              £
                                                                               
   Operating activities                                                        
                                                                               
   Cash flow from operations activities              (1,217,969)      (824,997)
                                                                               
   Returns on investment and servicing of finance                              
                                                                               
   Interest paid                                               -        (3,828)
                                                                               
   Interest received                                      46,940          4,640
                                                                               
                                                     (1,171,029)      (824,185)
                                                                               
   Taxation                                                    -        160,524
                                                                               
   Capital expenditure                                                         
                                                                               
   Payments to acquire intangible fixed assets       (1,154,059)      (678,707)
                                                                               
   Payments to acquire tangible fixed assets           (278,281)      (237,302)
                                                                               
                                                     (2,603,369)    (1,579,670)
                                                                               
   Financing                                                                   
                                                                               
   Issue of ordinary shares                            4,052,026         50,000
                                                                               
   Increase/(decrease) in cash equivalents             1,448,657    (1,529,670)
                                                                               
   Cash equivalents at start of period                 1,233,431      1,067,650
                                                                               
   Cash equivalents at end of period                   2,682,088      (462,020)
                                                                               
   Cash equivalents compromise                                                 
                                                                               
   Cash and cash equivalents                           2,682,088         40,776
                                                                               
   Bank overdrafts                                             -      (502,796)
                                                                               
                                                       2,682,088      (462,020)
                                                                               

    Reconciliation of operating loss to net           Six months     Six months
    cashflow from operating activities                     ended          ended
                                                         30 Sept        30 Sept
                                                            2006           2005
                                                       Unaudited      Unaudited
                                                                               
    Operating loss                                   (1,395,304)      (542,618)
                                                                               
    Exceptional Item                                     201,916              -
                                                                               
    Depreciation                                          91,626         64,328
                                                                               
    Amortisation                                          73,143         73,141
                                                                               
    Decrease in stocks                                    49,284        111,241
                                                                               
    (Increase) in debtors                              (380,885)      (577,749)
                                                                               
    Increase in creditors                                142,251         46,660
                                                                               
    Net cash inflow from operating activities        (1,217,969)      (824,997)
                                                                               
    Notes                                                                      
                                                                               
1.  The unaudited interim financial statements have been prepared on a basis   
    consistent with the statutory financial statements of Software Radio       
    Technology plc for the year ended 31 March 2006, except as detailed below. 
    Accounting standards introduced since that date have no impact on the      
    accounting treatment adopted.                                              
                                                                               
    On 19 October 2005, the Company acquired the entire issued share capital of
    Software Radio Technology (UK) Limited by means of a share for share       
    exchange. This group reconstruction has been accounted for under merger    
    accounting principles. The substance of the transaction was not the        
    acquisition of a business but a group reconstruction under which a new     
    holding company has been established with all the former shareholders      
    having the same proportionate interest in the new holding company.         
                                                                               
    The adoption of merger accounting presents Software Radio Technology plc as
    if it had always been the parent undertaking of the group.                 
                                                                               
    The interim financial statements, which have been approved by the          
    directors, are unaudited and have not been subject to independent review as
    defined in the Auditing Practices Board Bulletin 1999/4 and do not         
    constitute full statutory financial statements as defined in section 240 of
    the Companies Act 1985.                                                    
                                                                               
2.  Included in the profit and loss account is an exceptional charge of £      
    201,916, calculated in accordance with FRS 20, "share-based payment". The  
    requirement of this standard is to measure the fair value of employee share
    options and recognise that value as an expense over the life of the option 
    using an appropriate option pricing model. We have selected the Monte Carlo
    model for those options granted to the Chairman and the binomial model for 
    all other grants.                                                          
                                                                               
3.  The calculation of basic earnings per ordinary share is based on losses of 
    £1,348,364 (2005 - loss £396,753) and on 73,565,806 (2005 - 49,990,300)    
    ordinary shares, being the weighted average number of shares in issue      
    during the period.                                                         
                                                                               
4.  The Board is not recommending the payment of a final dividend.             
                                                                               
5.  Copies of these interim results will be sent to shareholders on or around  
    13 December 2006 and will be available for a period of one month from the  
    Company's registered office, Wireless House, Westfield Industrial Estate,  
    Midsomer Norton, Bath BA3 4BS