Interim Results

Harrier Group PLC
10 August 2004


                               HARRIER GROUP PLC
                              2004 INTERIM RESULTS

CHAIRMAN'S STATEMENT


I am pleased to announce an operating profit before exceptional costs of
£172,219 for the six months ended 30 June 2004 (2003: £138,731) on a
substantially increased turnover of £6,096,229 (2003: £4,254,722). The most
marked growth was in product sales, which along with general competitive
pressure in the sector had the effect of reducing the gross margin of the
business to 41% (2003: 49%).

Overheads had increased during the six months to meet the improving market
demand and we added to our staff numbers, taking the headcount to 58 (2003: 51).

Key highlights                       30 June 2004              30 June 2003
                                          (£'000)                   (£'000)

Turnover                                    6,096                     4,255
Gross Margin                                   41%                       49%
EBITDA                                        273                       272
Operating Profit                              172                       139
Profit on Ordinary                            195                        13
Activities
Cash                                        1,463                     1,369

We consider both the information security and data storage markets to be active
and, although competitive, we intend to compete strongly for both business and
market share. Our reputation and delivery capabilities continue to develop
through efficiencies and strong messaging. At the same time, strategic
partnerships with key vendors and service providers are maturing rapidly and we
believe that this will benefit both our revenues and gross margins in the coming
months.

I would like to thank our employees and management team for their continued
support and commitment to the Group's growth and development.

As announced on 29 July 2004, we are in advanced merger talks with Articon
Integralis AG which, if successful and subject to consent from both companies'
shareholders, will result in an enlarged group that will be the market leader in
our sector in the UK market and have well established operations in the USA and
Europe.

This is a major step forward for the Harrier Group, which will transform its
prospects and potential.


A L R MORTON
Chairman

9 August 2004

INDEPENDENT REVIEW REPORT TO THE DIRECTORS OF HARRIER GROUP PLC
SIX MONTHS ENDED 30 JUNE 2004


Introduction

We have been instructed by the company to review the financial information set
out on pages 3 to 8 and we have read the other information contained in the
interim report and considered whether it contains any apparent mis-statements or
material inconsistencies with the financial information.

Directors' Responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the Directors. The Directors
are responsible for preparing the interim report in accordance with the Listing
Rules of the UK Listing Authority which require that the accounting policies and
presentation applied to the interim figures should be consistent with those
applied in preparing the preceding annual accounts except where any changes, and
the reasons for them, are disclosed.

Review Work Performed

We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists primarily of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial data
and, based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with United Kingdom Auditing Standards and therefore
provides a lower level of assurance than an audit. Accordingly, we do not
express an audit opinion on the financial information.

Review Conclusion

On the basis of our review, we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2004.



Saffery Champness
Chartered Accountants
London

9 August 2004


CONSOLIDATED PROFIT AND LOSS ACCOUNT
SIX MONTHS ENDED 30 JUNE 2004

                                      Unaudited     Unaudited       Audited
                                     six months    six months    year ended
                                        30 June       30 June   31 December
                                           2004          2003          2003
                                              £             £             £

Turnover                              6,096,229     4,254,722     9,029,851

Cost of sales                        (3,610,386)   (2,176,811)   (4,613,122)
                                       ----------    ----------    ----------

Gross Profit                          2,485,843     2,077,911     4,416,729

Administrative expenses              (2,313,624)   (1,939,180)   (4,107,933)
                                       ----------    ----------    ----------

Operating profit before                 172,219       138,731       308,796
Exceptional costs

Exceptional severance costs                   -      (146,926)     (148,905)
                                       ----------    ----------    ----------

Operating profit/(loss)                 172,219        (8,195)      159,891

Interest receivable                      24,717       165,512       186,591

Interest payable                         (2,120)     (144,505)     (146,101)
                                       ----------    ----------    ----------

Profit on ordinary activities           194,816        12,812       200,381
before taxation

Taxation                                      -             -             -
                                       ----------    ----------    ----------
                                       ----------    ----------    ----------
Profit on ordinary activities           194,816        12,812       200,381
after taxation
                                       ----------    ----------    ----------

Profit for the financial
period                                  194,816        12,812       200,381
                                       ==========    ==========    ==========

Basic profit per share                     0.67p         0.05p         0.69p
                                       ==========    ==========    ==========

Diluted profit per share                   0.52p         0.04p         0.55p
                                       ==========    ==========    ==========


CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2004

                                      Unaudited     Unaudited        Audited
                                        30 June       30 June    31 December
                                           2004          2003           2003
                                              £             £              £

Fixed assets
Tangible assets                         332,825       484,178        376,059
                                       ----------    ----------     ----------

Current assets
Stock                                    25,503        33,471        103,841
Debtors                               2,460,796     2,080,895      2,143,900
Cash and bank balances                1,462,942     1,368,943      1,284,124
                                       ----------    ----------     ----------
                                      3,949,241     3,483,309      3,531,865
                                       ----------    ----------     ----------

Creditors
Amounts falling due within one year  (2,753,423)   (2,858,808)    (2,583,672)
                                       ----------    ----------     ----------
Net current assets                    1,195,818       624,501        948,193
                                       ----------    ----------     ----------

Net assets                            1,528,643     1,108,679      1,324,252
                                       ==========    ==========     ==========

Capital and reserves
Called up share capital                 293,103       287,197        292,420
Share premium account                         -    23,939,703     23,962,485
Capital redemption reserve                    -       268,972        268,972
Special reserve                       1,235,518             -              -
Profit and loss account                       -   (23,387,215)   (23,199,647)
                                       ----------    ----------     ----------

Equity shareholders' funds            1,528,621     1,108,657      1,324,230
Minority interests                           22            22             22
                                       ----------    ----------     ----------

Total shareholders' funds             1,528,643     1,108,679      1,324,252
                                       ==========    ==========     ==========

CONSOLIDATED CASH FLOW STATEMENT
SIX MONTHS ENDED 30 JUNE 2004

                              Note     Unaudited     Unaudited        Audited
                                         30 June       30 June    31 December
                                            2004          2003           2003
                                               £             £              £

Net cash inflow/(outflow)
from                             4       204,195      (245,997)      (363,021)
operating activities                    ----------    ----------     ----------

Returns on investments and
servicing of finance
Interest received                         24,717       165,512        186,591
Interest paid                             (2,120)     (144,505)      (146,101)
                                        ----------    ----------     ----------

                                          22,597        21,007         40,490
                                        ----------    ----------     ----------

Taxation
Corporation tax paid                           -             -              -
                                        ----------    ----------     ----------

Capital expenditure and
financial investment
Purchases of tangible fixed              (59,107)       (1,721)       (19,003)
assets
Sales of tangible fixed                    1,560             -          2,000
assets                                  ----------    ----------     ----------

Net cash outflow from
investing                                (57,547)       (1,721)       (17,003)
activities                              ----------    ----------     ----------

Financing
Issue of ordinary share                    9,573             -         28,004
capital
Loan notes repaid                              -   (12,000,000)   (12,000,000)
                                        ----------    ----------     ----------

                                           9,573   (12,000,000)   (11,971,996)
                                        ----------    ----------     ----------

Increase/(decrease) in cash              178,818   (12,226,711)   (12,311,530)
                                        ==========    ==========     ==========

Reconciliation of net cash
flow
to movement in net funds
Increase/(decrease) in cash
in the                                   178,818   (12,226,711)   (12,311,530)
period
Change in net debt from                        -    12,000,000     12,000,000
cashflows                               ----------    ----------     ----------

Movement in net funds in the             178,818      (226,711)      (311,530)
period

Net funds at start of period           1,284,124     1,595,654      1,595,654
                                        ----------    ----------     ----------

Net funds at end of period       5     1,462,942     1,368,943      1,284,124
                                        ==========    ==========     ==========



NOTES TO THE INTERIM RESULTS
SIX MONTHS ENDED 30 JUNE 2004

1. The interim figures for the six month period to 30 June 2004 are unaudited
   and do not constitute statutory accounts.

2. The financial information set out in the interim statement has been prepared
   in accordance with applicable accounting standards. The accounting policies 
   have been consistently applied both in 2003 and 2004 and are described in the 
   2003 financial statements.

3. The calculation of basic profit per ordinary share of 0.67p each is based on
   the profit on ordinary activities after taxation divided by the weighted 
   average number of ordinary shares in issue during the period of 29,268,288. 
   The diluted profit per share includes share options not exercised and the 
   weighted average number of ordinary shares in the period is 37,168,633.

4. Reconciliation of profit/(loss) to net cash inflow/(outflow) from operating 
   activities:

                                       6 months to  6 months to   Year ended
                                           30 June      30 June     Dec 2003
                                              2004         2003
                                                 £            £            £

Operating
profit/(loss)                              172,219       (8,195)     159,891
Depreciation                                95,826      131,099      249,748
Loss on disposal 
of fixed assets                              4,956        2,730        7,482
Decrease/(increase) in 
stock                                       78,338       (4,689)     (75,059)
Increase in
debtors                                   (316,896)    (283,587)    (346,592)
Increase/(decrease) in
creditors                                  169,752      (83,355)    (358,491)
                                           ---------    ---------   ----------
Net cash
inflow/(outflow) from
operating activities                       204,195     (245,997)    (363,021)
                                           =========    =========   ==========

5. Analysis of net funds:

                          At beginning     Cashflow    Other non    At end of
                             of period                      cash       period
                                                         changes
                                     £            £            £            £

Cash at bank
and in hand                  1,284,124      178,818            -    1,462,942
                             ==========    =========    =========   ==========

6. The company by special resolution, confirmed by an order of the High Court of
   Justice, reduced its share premium account and cancelled its capital 
   redemption reserve effective from 16 June 2004. In order to protect the 
   interests of its creditors the company undertook to transfer a specified 
   amount to a special non-distributable reserve until such time as those 
   creditors that were outstanding as at 16 June 2004 have been paid.

7. Minority interests represent non-participating shares in a subsidiary company
   Harrier Corporation Limited

8. The results for the year ended 31 December 2003 as shown in this report do
   not constitute statutory accounts but are an abridged version of the 
   company's 2003 accounts which have been filed with the Registrar of 
   Companies. The accounts to 31 December 2003 did not contain any statement 
   under section 237 (2) or (3) of the Companies Act 1985 and the auditors' 
   report was unqualified.

9. The interim report was approved by the directors on 9 August 2004. A copy of
   the interim report will be posted to shareholders and will also be available
   from the company's registered office at Cromwell House, Bartley Wood Business
   Park, Hook RG27 9XA.



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