Preliminary Results

Medsea Estates Group PLC
06 April 2006

                           
For immediate release 6 April 2006


                            MEDSEA ESTATES GROUP PLC
                 PRELIMINARY UNAUDITED RESULTS FOR THE YEAR TO
                                31 DECEMBER 2005


CHAIRMAN'S STATEMENT


The year 2005 was one of major investment for the Medsea Group. Recognising
market changes, we significantly expanded our infrastructure, launching products
in Italy, Cyprus, Turkey, Portugal and Bulgaria. We also increased our Spanish
presence with a major development in Aguilas, Murcia, and formed alliances with
major companies in the German, Dutch and Benelux markets.


As predicted our subsidiary Euromed, established to broaden the scope of our
activities, has begun to generate income, and is now in good shape to become a
significant contributor in 2006.


During the year we completed the reorganisation of our Resale Department,
strengthened our management and marketing team with a number of important
appointments and became the first company in the sector to receive the ISO9001:
2000 certificate of quality management.


The general downturn in the market earlier in the year caused our turnover to
fall by 39% over the previous period in 2004. Also the scale of our investment
in new countries and staff obviously had a major impact on profits, resulting in
a small loss of £52,000 (2004:profit of £2.24m).


This period of significant activity and investment is now completed and many of
our investments - Italy and the Aguilas development in particular - are already
making significant contributions to turnover. With Euromed set to fulfil its
potential, Medsea's long term future is assured and we look forward to further
progress in the coming months.


Tony Gatehouse, Chairman, Medsea Group.


For further information contact:

Medsea Estates Group PLC
Tony Gatehouse, Chairman
Juan Carlos Rodriguez Martinez, Chief Executive         0034 96 570 40 02

Beaumont Cornish Limited
Roland Cornish                                              0207 628 3396

Weber Shandwick Square Mile
Terry Garrett/ Alex White/ John                             0207 067 0700
Moriarty




GROUP PROFIT AND LOSS ACCOUNT
FOR THE PERIOD ENDED 31 DECEMBER 2005
                                                     Unaudited     Audited
                                                         Total       Total
                                           Notes          2005        2004
                                                         £'000       £'000

Turnover                                                 8,592      14,082

Cost of sales                                          (6,658)    (10,020)

Gross profit                                             1,934       4,062

Administrative expenses                                (2,204)     (1,595)

Group Operating profit/(loss)                  2         (270)       2,467

Share of operating profit in Associate                     224           -

Exceptional item                                             -       (219)

Interest receivable and similar income                       2           8
Interest payable and similar charges           3           (8)        (14)

Profit/(loss) on ordinary activities before               (52)       2,242
taxation

Tax on profit/(loss) on ordinary               4          (18)       (822)
activities

Profit/(loss) on ordinary activities                      (70)       1,420
after taxation

Minority interests                             5           (7)         (2)

Retained profit/(loss) for the year                       (77)       1,418

Earnings/(loss) per share
Basic                                                 (0.11 p)      2.12 p




GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE PERIOD ENDED 31 DECEMBER 2005

                                                    Unaudited      Audited
                                                         2005         2004
                                                        £'000        £'000
Statement of total recognised gains
and losses

Profit/(loss) for the financial year                     (77)        1,418

Foreign exchange gain/(loss)                              (2)           64

Unrealised surplus on revaluation of                        -           29
investment properties

Total recognised gains/(losses)                          (79)        1,511
relating to the year




GROUP BALANCE SHEET
AS AT 31 DECEMBER 2005
                                                    Unaudited                  Audited
                                                         2005                     2004
                                           £'000        £'000       £'000        £'000

Fixed assets
Intangible assets                                           5                        4
Tangible assets                                         1,135                    1,174
Investments                                                 4                       92
Investments in associates                                 236                        -
                                                        1,380                    1,270
Current assets
Stock                                        182                      129
Debtors                                    6,718                    7,500
Cash at bank and in hand                     156                    1,229
                                           7,056                    8,858
Creditors: amounts falling due within
one year                                 (3,654)                  (4,772)

Net current assets                                      3,402                    4,086

Total assets less current liabilities                   4,782                    5,356

Creditors: amounts falling due after
more
than one year                                           (108)                    (253)

Provisions for liabilities and charges                  (794)                  (1,042)

                                                        3,880                    4,061

Capital and reserves
Share capital                                           7,063                    7,063
Share premium                                              22                       22
Other reserve                                             118                      173
Revaluation reserve                                        95                       98
Merger reserve                                        (7,058)                  (7,058)
Profit and loss account                                 3,631                    3,761
Minority interests                                          9                        2
Shareholders' funds - equity                            3,880                    4,061




GROUP CASHFLOW STATEMENT
FOR THE PERIOD ENDED 31 DECEMBER 2005
                                                             Unaudited     Audited
                                                                  2005        2004
                                                                 £'000       £'000

Reconciliation of operating profit to net cash inflow from 
operating activities

Operating profit/(loss)                                           (270)      2,467
Share of operating profit in Associate                              224          -
Exceptional items                                                     -      (219)
Depreciation                                                        121         88
Foreign exchange                                                   (78)         75
Amortisation of intangible fixed assets                               2       (64)
(Profit)/loss on sale of fixed assets                                 7       (75)
(Increase)/decrease in debtors                                      635    (3,102)
Increase in stock                                                  (53)      (129)
Increase/(decrease) in creditors                                  (988)      1,295
Net cash inflow/(outflow) from operating                          (400)        336
activities

CASH FLOW STATEMENT

Net cash inflow/(outflow) from operating                          (400)        336
activities

Returns on investments and servicing of finance                     (6)        (6)

Tax paid                                                          (362)      (440)

Capital expenditure and financial investment                      (125)       (81)

Acquisitions and disposals                                            -        277

Management of liquid resources                                      (4)       (92)

Net cash flow before financing                                    (897)        (6)

Financing                                                         (261)        222

Increase/(decrease) in cash                                     (1,158)        216

Reconciliation of net cash flow to movements in
net debt

Increase/(decrease) in cash                                     (1,158)        216

Cash flow from increase/(decrease) in debt                          261      (138)

                                                                  (897)         78

Net debt at 1 January 2005                                          667        589

Net debt at 31 December 2005                                      (230)        667




NOTES TO THE FINANCIAL STATEMENT
FOR THE PERIOD ENDED 31 DECEMBER 2005

     
1.   Accounting policies

Basis of preparation

The preliminary statement is not the company's statutory accounts. The auditors
have not yet reported on the accounts for the year ended 31 December 2005 and
those accounts have yet to be delivered to the Registrar of Companies. The
accounts for the year ended 31 December 2004 have been audited and are available
for inspection at Companies House.


Basis of accounting

The financial statements have been prepared under the historical cost
convention, as modified by the revaluation of certain fixed assets and in
accordance with applicable United Kingdom accounting standards.


Basis of consolidation

The group accounts consolidate the accounts of Medsea Estates Group PLC and all
its subsidiary undertakings drawn up to 31 December each year. Medsea Estates
Group PLC acquired shares in Medsea UK Limited and all its subsidiaries on 16
July 2004. The accounts have been prepared using merger accounting so that all
the combining entities results are shown from 1 January 2004 and included in the
comparatives.


Associates

In the group financial statements investments in associates are accounted for
using the equity method. The consolidated profit and loss account includes the
group's share of the associate's profits while the group's share of the net
assets of the associates is shown in the consolidated balance sheet.


2.   Operating Profit/(Loss)
                                                   Unaudited      Audited
The operating profit is arrived at after charging:      2005         2004
                                                       £'000        £'000

Depreciation of owned assets                             116           86
Depreciation of leased assets                              5            2
Profit/(loss) on disposal of fixed assets                  7         (75)
Hire of equipment - operating leases - motor             472          509
vehicles
Hire of equipment - operating leases - land and          160           32
buildings
Auditors' remuneration                                    18           18

     
3.   Interest payable and similar charges
                                                   Unaudited     Audited
                                                        2005        2004
                                                       £'000       £'000

Bank loans and overdrafts repayable within five            7          13
years
Finance lease interest                                     1           1
                                                           8          14
     
4.   Taxation
                                                    Unaudited     Audited
                                                         2005        2004
                                                        £'000       £'000
Analysis of charge in the year

Current tax:
Spanish corporation tax on profits of the year            260         413
UK corporation tax on profits of the year                   6          67
Deferred tax                                            (248)         342
Tax on profit on ordinary activities                       18         822


The tax assessed for the year is higher than the standard rate of
corporation tax in the UK (30%). The differences are explained below:

                                                   Unaudited     Audited
                                                        2005        2004
                                                       £'000       £'000
Profit on ordinary activities before tax
     UK                                                   32          72
     Spain                                              (84)       2,170
                                                        (52)       2,242

Profit on ordinary activities multiplied by             (18)         673
standard rate of corporation tax in the UK of 30%
(2004: 30%)
Effects of:
Adjustment for foreign tax at a standard rate of           4         109
35%
Permanent timing differences                              32          14
Current tax charge for year as above                      18         796

The amount of deferred tax that has not been provided on revalued
investment properties is £nil (2004: £35,000).

     
5.   Minority interests

5% of the share capital of Euromed Investments SL and 10% of the share capital
of Profile Spain Ltd are held by an external third party.



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