Interim Results

Eleco PLC
20 March 2002



20 March 2002

                                   ELECO PLC

                     INTERIM RESULTS FOR THE SIX MONTHS TO
                                31 DECEMBER 2001

                             'Eleco back on track'


Enquiries to:


John Ketteley, Executive Chairman                    Tel: [phone] (today)
Eleco plc                                            Tel: [phone] (thereafter)

David Dannhauser, Finance Director Eleco plc         Tel: [phone] (today)
                                                     Tel: [phone] (thereafter)

David Millham/Tarquin Edwards                        Tel: [phone]
Holborn





CHAIRMAN'S STATEMENT



Profits before tax in the six months ended 31 December 2001 were in line with
those of the first half last year, cash flow was strong and we entered the
second half with higher order books than at 31 December 2000. We are therefore
pleased to be back on track after the difficult trading conditions that affected
performance in the second half of last year.



Turnover of the continuing businesses in the six months ended 31 December 2001
amounted to £14,210,000 (2000: £13,233,000) an increase of 7.4 per cent. Eleco
Building Systems contributed £13,566,000 (2000: £12,937,000), an increase of 4.9
per cent; Eleco Technology (software development and internet solutions)
contributed £644,000 (2000: £296,000), the increase reflecting the full period
contribution of the businesses acquired in the first half of the last financial
year.



Profits before tax and interest for the continuing businesses amounted to
£653,000 (2000: £657,000). Eleco Building Systems contributed £896,000 (2000:
£984,000), Eleco Technology incurred a profit of £20,000 before £37,000 of
goodwill amortisation charges (2000: profit £102,000) and central Corporate
Costs were considerably lower at £226,000 (2000: £429,000).



After interest charges of £81,000 (2000: £127,000), profits on ordinary
activities before tax for the six months were £572,000 (2000: £567,000). The tax
charge for the period was higher at £144,000, due in part to the inclusion of a
charge for deferred tax on the application of FRS 19 (2000: restated £96,000).
As a consequence, earnings after tax amounted to £428,000 (2000: £471,000)
equivalent to 1.0p per share (2000: 1.2p per share).




Net borrowings decreased by £737,000 in the period and at 31 December 2001
amounted to £1,509,000 (2000: £4,028,000), representing gearing of 17.4 per
cent. (2000: 47.7 per cent.). Capital expenditure in the period amounted to
£311,000 (2000 £324,000).



The Board has declared a dividend of 0.35p per share (2000: 0.35p), which will
be payable on 21 May 2002 to shareholders on the Register on 10 May 2002. The
interim dividend is covered nearly 3.0 times by earnings.



A number of commercial and other developments across the Group are beginning to
have an impact on our business and will grow in importance over the next twelve
months.



Bell & Webster Concrete Ltd



Bell & Webster Concrete received a £5.5 million order from Carillion plc to
supply 1601 FastBuild(R) rooms for The University of Hertfordshire, by far the
largest order ever won by Bell & Webster Concrete. In addition, a further
substantial order for student accommodation has been received for 750 FastBuild
(R) rooms for Essex University at a value of £2.7 million. Delivery of these
orders will begin in the current year with completion in the next financial
year. The expansion of the factory facilities at Grantham, completed in May
2000, provided the increase in capacity necessary to enable Bell & Webster
Concrete to take on such major project opportunities and production has recently
reached record levels of 160m3, equivalent to 384 tonnes of concrete a day.



Bell & Webster Concrete also completed the provision of terracing for the new
stands at Charlton, West Ham, Preston North End and has been approved as a
supplier of pre-cast concrete products to Railtrack.



Speeddeck Building Systems Ltd



SpeedDeck Building Systems also received the largest single order in its
history, for the supply of roofing for the Prologis warehousing complex at
Brackmills, Northampton. The order for approximately £1 million is due for
completion before the end of April, 2002.



SpeedDeck Building Systems' Vitesse(R) composite cladding wall panel system has
been selected for a number of projects and market recognition is increasing.



Stramit Industries Ltd



Stramit Industries experienced a difficult six months principally due to the
loss of a major customer. Steps have been taken by management to reduce costs
and restructure the business in line with the reduced volumes.



Gang-Nail Systems Limited



Gang-Nail Systems introduced further enhancements to its GN Truss and GN Roof
software during the period under review. The latest version has been received
with enthusiasm by truss fabricators and has been a key factor in gaining a
number of new clients.




We continue to be encouraged by the continuing market penetration of the
Ecojoist(R) floor joist system, the design software for which was developed in
conjunction with MBA Computing. Sales in the period under review were
encouragingly ahead of budget.



MBA Computing Ltd



MBA Computing's business was badly affected by deferral of orders for its design
software modules as customers have experienced difficulty in recruiting suitably
trained staff, although demand for its software development services was strong.
MBA Computing has therefore sought to broaden its geographic markets and has
recently received a first export order. The order, for timber frame software was
from Centex Corporation, one of the major house builders in the USA, and we are
proud to be associated with them.



Forma Communications Ltd



Forma Communications enjoyed considerable success in developing its
relationships with a number of major corporations, sports associations and
educational institutions. One such relationship is with Sony Computer
Entertainment Europe for whom Forma Communications has developed a number of
interactive websites for Playstation Games. The latest site, for the Sony
Playstation 2 World Rally Championship Game, www.wrc.com/playstation attracted
some 5,000,000 hits on the first weekend and 47,000 registrations.



The Muzantiks educational website for primary school children will be launched
later this year, in conjunction with Sinfonia 21 and Imperial College, London.



The www.keep-up-to-date.tv website for continuing professional development
developed for Redbus CPD was launched in December 2001 and has been nominated
for a number of awards.



For further information about the products and activities of the Group, I
recommend our website www.elecoplc.co.uk, from where there are links enabling
you to browse the websites of all our Group companies if you so wish. The
websites have been designed and maintained by Forma Communications.





OUTLOOK



At this time last year, I was concerned that the backlog of customers' business
due to the adverse weather conditions in the latter part of 2000 and early in
2001, would adversely affect our own businesses in the second half year. In the
event our customers were unable to make up the backlog and our sales suffered
accordingly. I am pleased to note that this situation has not arisen this year
and our markets have remained relatively stable thus far despite a generally
difficult economic climate. In the absence of unforeseen circumstances, given
the strength of our order books and our sound financial position, I view the
outcome for the second half of the year ending 30 June 2002 with some
confidence.



John Ketteley
Executive Chairman



                                                   Eleco plc                                                            
                                     Consolidated profit and loss account                                               
                                
                                                                                        (Unaudited)         (Audited) 
                                                                                    Half year ended        Year ended 
                                                                                        31 December           30 June 
                                                                             2001              2000              2001 
                                                                                         (restated)        (restated) 
                                                                            £'000             £'000             £'000 
  Turnover                                                                                                            
   Continuing operations                                                  14,210            13,233            25,795  
   Discontinued operations                                                     -               634             1,044  
                                                                          14,210            13,867            26,839  
  Operating profit                                                                                                    
   Continuing operations                                                     653               657             1,045  
   Discontinued operations                                                     -                37                10  
                                                                             653               694             1,055  
  Loss on disposal of discontinued operations                                  -                 -              (177) 
  Profit on ordinary activities before interest                              653               694               878  
  Net interest payable                                                       (81)             (127)             (249) 
  Profit on ordinary activities before tax                                   572               567               629  
  Tax on ordinary activities (Note 2)                                       (144)              (96)             (108) 
  Profit on ordinary activities after tax                                    428               471               521  
  Dividend on ordinary shares (Note 3)                                      (142)             (143)             (412) 
  Retained profit                                                            286               328               109  
  Dividends per share                                                      0.35p             0.35p             1.00p  
                                                                                                                      
  Earnings per share (Note 4)                                               1.0p              1.2p              1.3p  
  Diluted earnings per share (Note 5)                                       1.0p              1.2p              1.3p  




                                                                            Notes


          1. The interim results have been prepared on the basis of the accounting policies adopted
             for the year ended 30 June 2001, as set out in the Company's Annual Report and Accounts,
             except as modified by the adoption of Financial Reporting Standard 19 Deferred Tax
             (FRS19).
          2. Deferred tax unprovided as at 30 June 2001 has been provided for as required by FRS 19
             and included as a prior year adjustment by the restatement of the results for the year
             ended 30 June 2001.
             The current period effect of the adoption of FRS 19 is to increase the tax charge by
             £14,000. The effect  is to increase the tax charge by £167,000 for the year ended 30 June
             2001, and by £35,000 for the six months ended 31 December 2000. The effect on reserves
             and net assets at 30 June 2001 was a decrease of £221,000 and at 31 December 2000 a
             decrease of £89,000.
             The Group has adopted a policy of not discounting deferred tax assets and liabilities, as
             permitted by FRS19.
          3. The dividend will be payable on 21 May 2002 to shareholders on the register on 10 May
             2002.
          4. Based on the profit attributable to shareholders and a weighted average of 41,080,957
             ordinary shares (Dec 2000 - 39,047,907 and Jun 2001 - 39,940,305).
          5. Based on the profit attributable to shareholders and a diluted weighted average of
             41,712,205 ordinary shares (Dec 2000 - 40,113,001 and Jun 2001 - 40,834,667). The
             dilution is caused by outstanding share options.
          6. The comparative figures for the year ended 30 June 2001 have been taken from but do not
             constitute the Company's statutory accounts for that financial year and have been
             restated as described in note 2 above.  Those accounts have been reported on by the
             Company's auditors and delivered to the Registrar of Companies.  The report of the
             auditors was unqualified and did not contain a statement under section 237(2) or (3) of
             the Companies Act 1985.
          7. Copies of this interim statement and results, which were approved by the Board on 20
             March 2002, are available from the registered office of the Company, which is at Eleco
             House, 15 Gentlemen's Field, Westmill Road, Ware, Herts  SG12 0EF.




                                                                                                                      
                                               Eleco plc                                                                
                                Statement of Total Recognised Gains and Losses                                          
                           
                                                                                                                      
                                                                                            (Unaudited)     (Audited) 
                                                                                        Half year ended    Year ended 
                                                                                            31 December       30 June 
                                                                                     2001          2000          2001 
                                                                                             (restated)    (restated) 
                                                                                    £'000         £'000         £'000 
   Profit for the period as reported                                                  428           506           688  
   Restatement                                                                         -           (35)         (167) 
   Profit for the period as restated                                                  428           471           521  
   Currency translation differences                                                 (159)          (31)          (43) 
   on foreign currency net                                                          
   investments                                                                      
   Total recognised gains for the                                                    269           440           478  
   period                                                                           
 
The cumulative effect of the prior period adjustment on the profit and loss account brought forward at 1 July 2001,
occasioned by the adoption of FRS19, was a reduction of £221,000. 

                                                                                                                      
                                          Reconciliation of movement in equity shareholders' funds                      
                                     
                                                                                                                      
                                                                                            (Unaudited)     (Audited) 
                                                                                        Half year ended    Year ended 
                                                                                            31 December       30 June 
                                                                                     2001          2000          2001 
                                                                                             (restated)    (restated) 
                                                                                    £'000         £'000         £'000 
                                      Profit for the period                          428           471           521  
                                                                                                                      
                                      Dividends                                     (142)         (143)         (412) 
                                      Other recognised losses                       (159)          (31)          (43) 
                                      Proceeds from issue of ordinary                  2             8           362  
                                      shares                                                                          
                                      Issue of ordinary shares on                      -           646           646  
                                      acquisition of subsidiary                                                       
                                      undertakings                                                                    
                                      Net increase in equity                         129           951         1,074  
                                      shareholders' funds                                                             
                                      Opening equity shareholders'                 8,561         7,487         7,487  
                                      funds (Note 2)                                                                  
                                      Closing equity shareholders'                 8,690         8,438         8,561  
                                      funds                                                                           
 
 
                                                                                                                      
                                                                        Eleco plc                                       
                                                         Summarised consolidated balance sheet                          
                                                    
                                                                                                                      
                                                                                            (Unaudited)     (Audited) 
                                                                                            31 December       30 June 
                                                                                     2001          2000          2001 
                                                                                             (restated)    (restated) 
                                                                                    £'000         £'000         £'000 
                                                                                                                      
                                         Fixed assets                               8,539         9,112         8,777  
                                                                                                                      
                                         Current assets                                                                 
                                         Stocks                                    2,218         2,349         1,825  
                                         Debtors                                   5,688         6,860         6,450  
                                         Cash and bank balances                      368           572           482  
                                                                                                                      
                                                                                   8,274         9,781         8,757  
                                         Creditors falling due within one year                                          
                                         Bank loans and overdrafts                  (456)       (2,823)       (1,111) 
                                         Obligations under finance leases           (221)         (205)         (220) 
                                         Other creditors                          (5,878)       (5,766)       (5,891) 
                                                                                                                      
                                         Net current assets                        1,719           987         1,535  
                                                                                                                      
                                        Creditors falling due after more than one year                                  
                                         Bank loans                               (1,038)       (1,340)       (1,189) 
                                         Obligations under finance leases           (162)         (232)         (208) 
                                                                                  (1,200)       (1,572)       (1,397) 
                                                                                                                      
                                         Provisions for liabilities and             (368)          (89)         (354) 
                                         charges                                                                      
                                                                                                                      
                                         Net assets                                8,690         8,438         8,561  
                                                                                                                      
                                         Capital and reserves                                                           
                                         Called up share capital                   4,260         4,084         4,259  
                                         Share premium account                     5,049         4,869         5,048  
                                         Merger reserve                              367           367           367  
                                         Profit and loss account                    (986)         (882)       (1,113) 
                                                                                                                      
                                         Equity shareholders' funds                8,690         8,438         8,561  
 
  Eleco plc                                                                                                           
  Consolidated cash flow statement                                                                                    
                                                                                                                      
                                                                                            (Unaudited)     (Audited) 
                                                                                        Half year ended    Year ended 
                                                                                            31 December       30 June 
                                                                                        2001       2000          2001 
                                                                                       £'000      £'000         £'000 
                                        Operating activities                                                            
                                   
                                       Net cash inflow/(outflow) from                   723       (510)        1,913  
                                       continuing operating activities                                                
                                       Net cash inflow/(outflow) from                     -        (30)          228  
                                       discontinued operating activities                                              
                                       Net cash inflow/(outflow) from 
                                       operating activities                             723       (540)        2,141  
                                       Returns on investment and servicing of finance                                   
                                       Net interest paid                                (81)      (127)         (249) 
                                                                                                                      
                                       Net cash outflow from returns on investment 
                                        and servicing of finance                        (81)      (127)         (249) 
                                       Taxation                                          28        (12)         (132) 
                                       Capital expenditure and financial investment                                     
                                       Decrease/(increase) in loans to                   61          -          (352) 
                                       Employee Share Ownership Trust                                                 
                                       Purchase of fixed assets                        (311)      (324)         (634) 
                                                                                                                      
                                       Sale of tangible fixed assets and                  3          4            10  
                                       investments                                                                    
                                       Net cash outflow from capital expenditure and 
                                       financial investment                            (247)      (320)         (976) 
                                       Acquisitions and disposals                                                       
                                       Purchase of subsidiary                             -       (713)         (713) 
                                       undertakings net of cash acquired                                              
                                       Sale of subsidiary undertaking's                 767          -           (64) 
                                       operations                                                                     
                                       Net cash inflow/(outflow) from acquisitions 
                                       and disposals                                    767       (713)         (777) 
                                       Equity dividends paid                           (267)      (252)         (395) 
                                       Net cash inflow/(outflow) before financing       923     (1,964)         (388) 
                                       Financing                                                                        
                                       New bank loans                                     -        500           500  
                                       Repayment of principal under                    (118)      (111)         (250) 
                                       finance leases                                                                 
                                       Repayment of bank loans                         (151)      (122)         (273) 
                                       Issue of ordinary shares                           2          8           362  
                                       Net cash (outflow)/inflow from financing        (267)       275           339  
                                       Increase/(decrease) in cash in the period        656     (1,689)          (49) 
                                                                                                                      
 
                                                                                                                      
  Eleco plc                                                                                                           
  Consolidated cash flow statement (continued)                                                                        
                                                                                                                      
                                                                                            (Unaudited)     (Audited) 
                                                                                        Half year ended    Year ended 
                                                                                            31 December       30 June 
                                                                                        2001       2000          2001 
                                                                                       £'000      £'000         £'000 
                                                                                                                      
                                     Reconciliation of operating profit to net 
                                     cash flow from operating activities                                                
                                     Operating profit                                   653        694         1,055  
                                     Depreciation charge                                552        504         1,074  
                                     Amortisation of intangible assets                   38         18            47  
                                     Profit on sale of fixed assets                      (2)        (1)           11  
                                     Working capital increase                          (518)    (1,755)          (46) 
                                                                                                                      
                                     Net cash inflow/(outflow) from                     723       (540)        2,141  
                                     operating activities                                                             
                                                                                                                      
                                                                                                                      
                                     Reconciliation of net cash flow to movement 
                                     in net debt                                                             
                                     Increase/(decrease) in cash in the                 656     (1,689)          (49) 
                                     period                                                                           
                                     Cash outflow/(inflow) from                         269       (267)           23  
                                     decrease/(increase) in debt and                                                  
                                     lease financing                                                                  
                                     Decrease/(increase) in net debt                    925     (1,956)          (26) 
                                     resulting from cash flows                                                        
                                     New finance leases                                 (73)      (191)         (368) 
                                     Finance lease obligations disposed                   -          -            47  
                                     of on sale of business                                                           
                                     Finance lease obligations acquired                   -        (10)          (10) 
                                     with subsidiary undertakings                                                     
                                     Effects of changes in foreign                     (115)       (14)          (32) 
                                     exchange rates                                                                   
                                     Decrease/(increase) in net debt                    737     (2,171)         (389) 
                                     Opening net debt                                (2,246)    (1,857)       (1,857) 
                                     Closing net debt                                (1,509)    (4,028)       (2,246) 
 
 
 
 

                                                                                                                      
                                                                    Eleco plc                                           
                                                               
                                                                 Segmental analysis                                     
                                                            
                                                                                                                      
                Group turnover and profits were attributable as follows                                               
                                                                                                                      
                                  External sales                               Profit/(loss)                          
                                  (Unaudited)                (Audited)         (Unaudited)                (Audited)   
                                           Half year ended    Year ended                Half year ended    Year ended 
                                               31 December       30 June                    31 December       30 June 
                                            2001      2000          2001                  2001     2000          2001 
                                           £'000     £'000         £'000                 £'000    £'000         £'000 
                                                                                                                      
                Continuing                                                                                            
                activities                                                                                            
                Building                 13,566    12,937        24,957                   896      984         1,726  
                systems                                                                                               
                Software                    644       296           838                   (17)     102           105  
                systems                                                                                               
                Corporate                     -         -             -                  (226)    (429)         (786) 
                Total                    14,210    13,233        25,795                   653      657         1,045  
                continuing                                                                                            
                Discontinued                                                                                          
                activities                                                                                            
                Rail and marine               -       634         1,044                     -       37            10  
                                                                                                                      
                                                                                                                      
                Total                         -       634         1,044                     -       37            10  
                discontinued                                                                                          
                Exceptional                                                                 -        -          (177) 
                losses                                                                                                
                Profit before                                                             653      694           878  
                interest                                                                                              
 




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