Interim Results

Concurrent Technologies PLC
21 September 2004



Concurrent Technologies Plc

Interim results for the six months ended 30 June 2004



Concurrent builds on market leading position

Concurrent Technologies Plc, which manufactures high end embedded computer
products for critical applications in the defence, transportation,
communications and industrial markets, announces its interim results for the six
months ended 30 June 2004.

•    Market conditions continue improvement from 2003

     o    Sales and marketing activity at record levels for Concurrent

     o    Gross margins of 40% holding up well

•    Balance sheet strength: £2.8 million net cash

•    Recommended dividend 0.25p per share

•    Component supply issue, now resolving with no expected long term impact

•    New product development gathers pace thus differentiating the company
     from its competitors

     o    Wider range of products

     o    Development agreement with Thales Group starting to bear fruit



Michael Collins, Chairman, commented:

'High levels of expenditure in the USA on electronic defence systems and
homeland security projects continues, as does investment in new telecoms and
internet security applications in the USA and China. We are directing most of
our investment in R&D towards these markets.

'Although the component supply problem we encountered last year pushed us into
modest loss in the first half of this year, we are confident of a strong
financial performance in the second half. We are seeing unprecedented numbers of
systems integrators requiring our boards. In the first half of 2004 we sold to
17% more users than we did in the same period last year. Most of these
purchasers are still only acquiring development quantities and have yet to
require production quantities from us. Hence our confidence about the future.'

                                                               21 September 2004

Enquiries:

Concurrent Technologies

Glen Fawcett, Managing Director                                     01206 752626

College Hill

Nicholas Nelson / Sam Allen                                        020 7457 2020



Chairman's Statement

Business Summary


Concurrent Technologies designs, builds and supplies high end embedded computer
products to the defence, communication, transportation and industrial markets.
These computer products are integrated into a variety of applications which
require very high levels of processing power and superior levels of reliability;
applications include military systems, communications, networking, medical
imaging, industrial automation and scientific research.

The main product range includes single and dual processor computer boards using
Intel(R) and Motorola(R) Central Processing Units (CPUs) for the CompactPCI(R),
VME and Multibus II architectures. In addition to hardware design capability,
our engineering teams undertake a significant amount of software and firmware
development to provide interoperability between products, generate test software
both on-board and for production test purposes, and also provide support for
leading embedded and real-time operating systems.

The largest single market for our products is now defence, closely followed by
communications. Together these markets in the first six months of 2004 accounted
for 76% of our sales by value.


Financial

Conditions in the specialised part of the single board computer market in which
we operate, having improved through 2003, continue to improve this year.  There
is a weakening of demand in the worldwide consumption of microprocessors but we
see this as primarily affecting sales to the consumer sector and not the defence
and commercial end user sectors in which we operate. Group turnover for the
first six months of 2004 was £2.98million.  As anticipated turnover was
substantially affected in this period by the announcement of the end of life of
a CPU which was a core component of our most popular boards.  As a consequence,
the company made a pre-tax loss for the period of £130,896 (2003 profit
£351,562).  Gross margins in the first six months of the year at just over 40%
have held up well notwithstanding the reduced turnover.  We expect this to
improve as volumes increase and extended temperature range products (which
attract higher margins) start to become a significant element of the total.

We have controlled costs well without reducing expenditure on R & D and our
margins remain good. Consequently we ended the period with cash of £2,846,555
and no borrowings.


Review of Operations

The early discontinuance of the key component referred to above affected us
throughout the first six months of 2004. That problem is now behind us as we
have released a new range of VME and CompactPCI(R) boards based on the Intel(R)
Pentium(R) M CPU (including extended temperature range versions) which has
received wide acceptance from our customers. We believe the effect of the
problem was to delay our progress for about 8 months from the start of the
problem in September 2003.  We also believe that it has not caused us any
material damage other than short term loss of revenue.

Most of our products are aimed at applications for benign environments, but we
are injecting increasing effort to win projects in less benign environments as
the margins which can be achieved in these projects are higher. We now have an '
E' range which is designed to operate at temperatures in the range -25 degrees
to +70 degrees Celsius and a 'K' range designed to operate between -40 degrees
and +85 degrees Celsius. Boards which operate in these extreme conditions are
not as price sensitive and higher margins can be achieved. We do not at present
offer any boards which will also withstand high vibration and high shock levels
and operate in a conduction cooled environment.  This will change shortly as a
result of our joint venture with the Thales Group under which we have designed a
new non-ruggedised board for them which they will take and themselves produce
ruggedised versions. We will be able to sell the ruggedised versions as part of
our range alongside Thales who already include our non-ruggedised versions in
their range.

We have never seen as much customer interest in our products as we are seeing at
the moment and sales and marketing activity is at a very high level. The focus
of our marketing has changed over the last three years; in 2001 the largest part
of our sales was to the medical sector, but since then defence and
communications projects have become increasingly important to us. We are being
invited to quote on larger projects than in the past, and the U.S.A. has become
our largest market. During the first six months of this year we have opened a
sales office in Orange County, California on the West Coast of the U.S.A.

The significant investment in new Computer Aided Design equipment we made in
2003 is now yielding productivity gains. The new equipment has already decreased
the time taken to design the layout of a board while simultaneously enabling us
to increase a board's functionality. Having already reduced the layout time
taken per board we expect to achieve a 50% overall reduction by the end of this
year as our understanding of the new tools continues to improve. This is an
important advance as shorter development times reduce our time to market, which
is a key issue that differentiates us from most of our competitors.


Future Strategy

We have not reduced our investment in research and development. We intend to
continue the expansion of the range of hardware we design and build, and to keep
increasing our investment in software and firmware engineering so as to make our
hardware operate with an ever increasing range of software products. In the
first six months of 2004 we have ported LynxOS(R) and Linux(R) to our Motorola
(R) PowerPC(R) based products.

Our strategy is to continue to support and expand all three of our existing
embedded computer technology architectures. These are VME CPUs, powered by Intel
(R) and Motorola(R) PowerPC(R), and CompactPCI(R) and Multibus II, both powered
by Intel(R) CPUs. Multibus II is coming towards the end of its life but while it
is still reasonably widely accepted we will support it, if only because there is
little competition and margins are good. We see VME as having strong growth
still, particularly for defence and industrial applications. The CompactPCI(R)
architecture was extended a few years ago to include 64-bit/66MHz capability
which gave this bus architecture more bandwidth than VME or Multibus II, and
therefore made it suitable for communications applications even though in recent
times VME has been speeded-up. We see this continuing for some time, but there
is a new architecture that is gaining market acceptance, Advanced
Telecommunications Computing Architecture (AdvancedTCA(R)), using very high
speed serial inter-connections based on switched fabric methods. Its larger
board size offers higher functionality, better cooling and an improved price/
performance ratio. We believe this will prove popular with the
telecommunications system builders and we intend to produce AdvancedTCA(R)
boards for the market.

In anticipation of increased demand on our production and test facility and in
response to the ever increasing complexity of our boards, we are enhancing the
methods by which we test our products before shipment. To this end we have
recently purchased an automated optical inspection machine which electronically
examines the quality of the thousands of connections on our boards. We are also
looking at installing a further machine for selecting and placing microchips on
the surface of the boards and another reflow oven so as to create a second, and
much faster, production line suitable for building larger production runs.

We have expanded our sales capability in the U.S.A. this year and are conscious
that some of our larger opportunities are coming from China. We are turning our
sales attention to China where we are currently operating through distributors.
It is likely we will open a sales office there in the next year.

We continue to look to enhance our capabilities to produce complete embedded
computer systems as well as the component boards which go in them and to take
advantage of outsourcing opportunities which come from customers who wish to
downsize in house engineering staff to reduce fixed costs.


Dividend

The outlook for our business in the second half of this year and particularly
into next year continues to improve. We have therefore decided to pay an interim
dividend of 0.25 pence per share (the same as the interim and final dividends
last year). The total cost of this interim dividend will amount to £181,750. The
ex-dividend date for the dividend is 29th September 2004, the record date is 1st
October 2004 and payment will be made on 22nd October 2004.


Outlook

High levels of expenditure in the USA on electronic defence systems and homeland
security projects continue, as does investment in new telecoms and internet
security applications in the USA and China. We are directing most of our
investment in R&D towards these markets.

Although the component supply problem we encountered last year pushed us into
modest loss in the first half of this year, we are confident of a strong
financial performance in the second half. We are seeing unprecedented numbers of
systems integrators requiring our boards. In the first half of 2004 we sold to
17% more users than we did in the same period last year. Most of these
purchasers are still only acquiring development quantities and have yet to
require production quantities from us. Hence our confidence about the future.


Corporate Governance

As an AIM listed company Concurrent Technologies Plc is not obliged to comply
with the Combined Code. We do however acknowledge the overall importance of the
guidelines and apply as many of the principles therein as are appropriate to a
company of our size and nature. Consequently we have appointed Clive Thomson as
an additional non-executive director.

All companies and product names are trademarks of their respective
organisations.


Consolidated Trading Results

                                                                                 Unaudited     Unaudited       Audited
                                                                                six months    six months    year ended
                                                                                   30/6/04       30/6/03      31/12/03
                                                                                         £             £             £

                        Turnover                                                 2,975,852     4,036,489     7,303,805
                        Profit / (loss) on ordinary activities before             (130,896)      351,562       280,283
                        taxation
                        Taxation on profit on ordinary activities                   10,878        85,609       (50,662)
                        Profit / (loss) for the period                            (141,774)      265,953       330,945
                        Dividend                                                   181,750       181,750       363,500
                        Retained profit / (loss) for the period                   (323,524)       84,203       (32,555)

                        Basic and diluted earnings per share                        (0.20p)        0.37p         0.46p
                        Basic and diluted earnings per share excluding              (0.18p)        0.39p         0.49p
                        amortisation of goodwill




   Consolidated Balance Sheet

                                                                       Unaudited     Unaudited       Audited
                                                                         30/6/04       30/6/03      31/12/03
                   FIXED ASSETS                                                £             £             £

                   Goodwill                                              139,577       181,201       154,612
                   Tangible assets                                       462,722       603,099       536,708
                                                                         602,299       784,300       691,320

                   CURRENT ASSETS
                   Stocks and work in progress                         1,263,408     1,025,153       956,240
                   Debtors                                             1,555,222     1,701,323     1,417,753
                   Cash at bank and in hand                            2,846,555     3,059,813     3,263,408
                                                                       5,665,185     5,786,289     5,637,401

                   CREDITORS
                   amounts falling due within one year                 1,500,647     1,219,009     1,205,288
                   NET CURRENT ASSETS                                  4,164,538     4,567,280     4,432,113

                   TOTAL ASSETS LESS CURRENT LIABILITIES               4,766,837     5,351,580     5,123,433

                   Provision for liabilities and charges                  20,494        52,918        33,032

                   NET ASSETS                                          4,746,343     5,298,662     5,090,401



                   CAPITAL AND RESERVES
                   Called up share capital                               727,000       727,000       727,000
                   Share premium account                               3,405,817     3,405,817     3,405,817
                   Capital redemption reserve                            256,976       256,976       256,976
                   Profit and loss account                               356,550       908,869       700,608
                   EQUITY SHAREHOLDERS' FUNDS                          4,746,343     5,298,662     5,090,401


Notes To The Financial Statements


1   The results for the year ended 31 December 2003 are abridged from the
    Financial Statements for the year which contain an unqualified audit report 
    and have been filed with the Registrar of Companies.



2   The taxation charge for the six months ended 30 June 2004 is based on
    the estimated effective tax rate for the full year.



3   The calculation of earnings per share for the six months to 30 June 2004 
    is based on the number of Ordinary Shares in issue of 72,700,012. 
    Comparative earnings per share for the periods shown are based on the same
    number of Ordinary Shares in issue.

    In accordance with FRS 14 (Earnings per Share) the diluted earnings per 
    share amounts are the same as the basic earnings per share.


4   Copies of this report will be sent to shareholders and are available
    at the Company's Registered Office.



All companies and product names are trademarks of their respective
organisations.


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