Final Results

Rap Group PLC
2 March 2001



               Preliminary Announcement of the Audited Results

         of RAP Group plc ('RAP') for the year ended 31 December 2000



2000 was a year of momentous change for RAP during which the fundamental
restructuring of the Group included the sale of both the conveyor and rubber
and safety businesses against the background of continued decline in the
activity levels of each business.



A one-for-one rights issue in June, raised £1.9 million and provided the
refinancing necessary to implement the disposal programme.  It also supported
the Company in its move into IT and e-commerce activities.



In November the Company transferred from the Official List to AIM and shortly
after appointed Rowan Dartington as its nominated adviser and broker.



The fixings business has continued its recovery and the gardening division's
decline has been partially arrested.  However, the Board believes these
hardware businesses will only show their full potential in the medium term.
The Board now wishes to focus on its IT and e-commerce activities.  Approaches
from third parties for the hardware businesses failed to deliver the expected
values.  The Board has therefore decided, subject to shareholders' approval,
to sell these businesses to Paddico, a company owned by Peter Gyllenhammar,
one of RAP's major shareholders, for a deferred consideration, which is
structured around an expected realisation of £1m.  This price is in excess of
offers from third parties.  The sale contract provides for 80 per cent. of any
increase in value over £1 million and 10 per cent. of any decrease below £1
million on the subsequent sale of this business by Paddico to be paid to RAP.
In the meantime, RAP will provide Paddico with the accounting and
administrative support and the businesses will continue to be managed by Brian
Shaw.



In the autumn of 2000 the Board identified certain acquisitions which it
wished to make, but which it was not in a position to conclude due to the
disposal programme and the timing problems associated with its full listing
status.  The Board therefore approached Peter Gyllenhammar with a view to him
acquiring these businesses whilst RAP concluded its disposal programme.  As a
result, Silverslaggan AB, a company owned by Peter Gyllenhammar, acquired
certain Enterprise Resource Planning (ERP) businesses of Kewill Systems plc.



RAP announced today that it has now exchanged conditional contracts with
Silverslaggan AB to acquire those ERP businesses now known as K3 Business
Technology Group Limited and K3 Business Technology Software Limited.  These
companies are to be acquired for an aggregate consideration of £3,742,000 ('
the Consideration'), in addition RAP will assume a loan of £310,000.  The
Consideration will be satisfied as to £3,352,000 in cash or in new ordinary
shares issued at a value of 15p per share on completion, the balance of the
Consideration being £390,000, will be paid in instalments over the next 21
months.



To help fund the cost of the acquisitions and to provide additional working
capital the Company is making available 25.65 million new ordinary shares to
existing shareholders through a one for one open offer.



The acquisitions and open offer are conditional upon shareholders' approval
which will be sought at an EGM to be held on 26 March 2001.



Further details regarding the acquisitions, the open offer and various related
proposals are set out in a separate announcement made today and in a circular
which has been despatched to shareholders today.



Following the acquisition RAP intends to change its name to K3 Business
Technology Group plc.



Financial Results



The results for the year to 31 December 2000 show further decline in sales of
27.6 per cent. to £14.25 million (1999: £19.68 million).  This reflects both a
contraction in the old core businesses of rubber, safety products and glove
distribution and the sale of these businesses and RAP Conveyors Limited during
the year.  This resulted in a loss in the period of £5.19 million (1999: £1.63
million) after losses on disposal of £1.7 million (including goodwill written
off of £0.3 million) and profits on property disposals of £0.3 million.



Operational Review



During the year the group implemented its programme of restructuring as it
progressed its IT and e-commerce strategy.



(S)         In May it disposed of RAP Conveyors Limited for approximately £0.4
million.

(S)         In June it agreed to buy Touchline Network Television Limited, a
company specialising in multimedia and e-commerce development.

(S)         In July it completed a rights issue raising £1.9 million.

(S)         In August it completed the sale of its property in Hamilton,
Scotland, for £475,000.

(S)         In November it completed the disposal of its rubber, safety
products and glove divisions for approximately £3.60m.



Board Changes



As previously reported, Mr Andy Makeham joined the Board on 1 July 2000 as
Marketing Director, e-Commerce.  Following the sale of the rubber and safety
products divisions, Mr John Savage resigned as Chairman and Chief Executive.
Mr John Grimshaw also resigned as Operations Director.



Following the acquisition of the ERP businesses, Mr Makeham will become Chief
Executive.  Mr John Griffith, managing director of Intershop (UK) Limited,
will join the Board following the EGM in March.  Mr Johan Claesson, the
Company's major shareholder and chairman of Claesson and Anderzen AB, a
substantial Swedish property company, has also been invited to join the board
as non-executive Chairman following the EGM.



Trading and Prospects



Sales in the traditional rubber and safety businesses continued to decline,
the deterioration being exaggerated by the sale of these businesses during the
period, with a year on year reduction of £4.07m, resulting in heavy losses.
The fixings business registered a modest increase in the second half of 2000,
with sales for the year up 30 per cent. on 1999.  Major new contracts secured
during the year should provide further growth in revenues.  Sales of the
gardening products businesses have started to stabilise, holding at 84 per
cent. of the 1999 level.  Touchline reported revenues of £0.31m in its first
six months of operation within the group, reflecting the continued growth in
its multimedia and e-commerce development activities.



The proposed disposal of the fixings and gardening divisions will finalise the
divestment of the company's legacy businesses.  The proposed acquisitions will
complement the remaining activities, creating a Group that is well placed to
sell ERP software solutions and which can develop into a provider of wider
e-business solutions to the SME sector.



Consolidated profit and loss account for the year ended 31 December 2000:


                       _____ 2000 ______            ________ 1999 __________
                              Dis-                                Dis-   
                             Continuing                       continued       
         Continuing operations operations   Total Continuing* operations  Total
      Acquisitions Continuing*                    operations 
                              
             £'000    £'000     £'000       £'000   £'000     £'000     £'000
Turnover       305    3,553    10,392     14,250    3,077   16,608      19,685

Cost of sales (161)  (3,414)   (7,122)   (10,697)  (2,237)  (12,073)   (14,310)
Gross profit   144      139     3,270      3,553      840     4,535      5,375
Selling and
distribution
costs            -     (429)   (1,083)    (1,512)    (593)   (1,165)    (1,758)
Administrative
expenses       (59)  (2,884)   (2,656)    (5,599)  (1,771)   (3,214)    (4,985)
               
Operating
profit (loss)   85   (3,174)     (469)    (3,558)  (1,524)     156      (1,368)
                
Loss on
disposal of
operations       -       -     (1,667)    (1,667)       -        -           -
Profit on
disposal of
property        -        -        305        305        -         -           -
Profit (loss)
on ordinary
activities     85     (3,174)  (1,831)    (4,920)  (1,524)      156     (1,368)
before
interest
Interest
payable and
similar                                     (271)                         (267)
charges
Loss on
ordinary
activities                                 (5,191)                       (1,635)
before
taxation
Tax on loss on                                  -                              -
ordinary
activities
Loss for the
financial year                             (5,191)                       (1,635)




*     With the exception of Administrative expenses of £530,000 in 2000,
continuing operations are to be discontinued subject to the motion proposing
the disposal of Welpac Hardware Limited, Harwood Hardware Limited and Anderson
& Firmin Limited being passed at the EGM scheduled to be held on 26 March
2001.


Loss per share
Basic                                              (29.2p)              (13.3p)
Diluted                                            (29.2p)              (13.3p)
Basic before exceptional items                     (19.7p)               (7.8p)



Consolidated statement of total recognised gains and losses for the year ended
31 December 2000


                                                             2000         1999

                                                            £'000        £'000
Retained loss for the financial year                       (5,191)       (1,635)
Unrealised deficit on revaluation of freehold                   -         (10)
property
Total recognised losses since the last annual report       (5,191)       (1,645)
and accounts



Consolidated balance sheet as at 31 December 2000


                                                             2000          1999

                                                            £'000         £'000
Fixed assets

Goodwill                                                      127            28
Tangible assets                                               235         2,829
Investments                                                     7             -
                                                              369         2,857
Current assets

Properties for resale                                         260            75
Stocks                                                      1,071         4,538
Debtors                                                     1,088         4,720
                                                            2,419         9,333
Creditors: amounts falling due within one year            (2,071)       (8,022)
Net current assets                                            348         1,311

Total assets less current liabilities                         717         4,168

Creditors: amounts falling due after more than one              -         (360)
year
Provisions for liabilities and charges                      (243)         (482)

Net assets                                                    474         3,326


Capital and reserves

Called up share capital                                     1,283           616
Share premium account                                       6,601         5,259
Shares to be issued                                            59             -
Revaluation reserve                                             -           462
Profit and loss account                                   (7,469)       (3,011)
Equity shareholders' funds                                    474         3,326





Consolidated cash flow statement for the year ended 31 December 2000


                                                              2000         1999

                                                             £'000        £'000
Net cash (outflow) inflow from operating activities        (1,595)          193

Returns on investments and servicing of finance              (271)        (267)
Capital expenditure and financial investment                   288         (94)
Acquisitions and disposals                                   3,100            -
Cash inflow (outflow) before financing                       1,522        (168)

Financing                                                    1,064        (418)
Increase (decrease) in cash in the year                      2,586        (586)




Notes:



1.         Cost of sales, gross profit and other operating expenses



The operating loss for the year included exceptional items within
administrative expenses as summarised below:


                                                          2000             1999

                                                         £'000            £'000
Re-organisation and closure:
Centralisation of group functions                            -              201
Redundancy and closure costs                                 -              160
Re-organisation                                              -               75
Fixed asset impairment                                     327               20
Dilapidations provision                                      -               28
Provision for legal claims                                   -              200
Disposal of properties                                       -              (5)
                                                           327              679



2.         Acquisition of subsidiary undertaking



On 26 June 2000 the company acquired 100 per cent. of the issued share capital
of Touchline Network Television Limited for consideration comprising the issue
of 500,000 ordinary shares of 5p each in the company, and a further 330,000
ordinary shares of 5p each within twelve months should certain profit targets
be met by Touchline.  The fair value of the total consideration was £169,000.



The following table sets out the book values of the identifiable assets and
liabilities acquired and their fair value to the group:


                                               Accounting

                           Book value              policy           Fair value

                                              adjustments             to group
                                £'000               £'000                £'000
Fixed assets

Tangible                           25                 (4)                   21
Current assets

Work in progress                   50                (15)                   35
Debtors                            45                   -                   45
Cash                               24                   -                   24
Total assets                      144                (19)                  125


Creditors

Trade creditors                  (37)                   -                 (37)
Other creditors                  (40)                   -                 (40)
Accruals                         (13)                   -                 (13)
Total liabilities                (90)                   -                 (90)

Net assets                         54                (19)                   35

Goodwill                                                                   134

                                                                           169

Satisfied by

Shares issued                                                              110

Shares to be issued                                                         59

                                                                           169




The fair value adjustments were made in order to reflect alignment with the
Group's accounting policies.


                                                                          £'000
Net cash inflows in respect of the acquisition comprised:
Cash at bank and in hand acquired                                            24



Touchline Network Television Limited earned a profit after taxation of £68,000
in the nine months ended 31 December 2000 (year ended 31 March 2000 - £
45,000), of which a loss of £17,000 arose in the period from 1 April 2000 to
26 June 2000.



There were no recognised gains or losses other than the profit for the period.



3.         Sale of subsidiary undertaking



On 3 May 2000 the group sold its 100 per cent. interest in the ordinary share
capital of RAP Conveyors Limited.  The loss of RAP Conveyors Limited up to the
date of disposal was £9,000 and the profit for its last financial year was £
88,000.



Net assets disposed of and the related sales proceeds were as follows:


                                                                          £'000
Fixed assets                                                                 95
Current assets                                                              934
Creditors                                                                 (422)
Net assets                                                                  607

Transaction costs of disposal                                               127
Loss on sale                                                              (377)
Sale proceeds                                                               357


Satisfied by:
Cash                                                                        500
Adjustment to consideration                                               (143)
                                                                            357



4.         Sale of trade and assets of subsidiaries



On 6 November 2000 certain subsidiaries of the group sold their trade and
assets to Zika Rapid Distribution Limited, a subsidiary of Zika Electrode
Works Limited (a company listed on the Tel Aviv Stock Exchange).  The
subsidiaries were:



RAP Industrial Distributions Limited

Rubber and Allied Products (R.A.P.) Limited

Potter Cowan & Co Limited

Waugh of Hamilton Limited

Safety Specialists Limited

Planet Gloves (Industrial) Limited

Poplar Industrial Supplies (Stourbridge) Limited

Man-equip Limited



Net assets disposed of the related sales proceeds were as follows:


                                                                          £'000
Fixed assets                                                              1,657
Current assets                                                            4,138
Creditors                                                               (2,191)
Net assets                                                                3,604

Related goodwill previously written off to reserves                         271
Transaction costs of disposal                                             1,019
Loss on sale                                                            (1,290)
Sale proceeds                                                             3,604



Satisfied by:

Cash                                                                      3,400

Deferred consideration to be satisfied by cash                              204

                                                                          3,604




5.         Reconciliation of operating loss to operating cash flow


                                                             2000         1999

                                                            £'000        £'000
Operating loss                                             (3,558)       (1,368)
Depreciation charges and fixed asset impairment               683          392
Write down of property held for resale                         28           53
Amortisation of goodwill                                       12            6
Profit on sale of tangible fixed assets                         -         (17)
Decrease in stocks                                          1,277          385
Decrease in debtors                                         1,062          890
Decrease in creditors                                       (860)        (330)
(Decrease) increase in provisions                           (239)          182
Net cash (outflow) inflow from operating activities        (1,595)          193



6.         Analysis of cash flows


Acquisitions and disposals                                2000             1999

                                                         £'000            £'000
Bank balances acquired with subsidiary                      24                -

Sale of subsidiary                                         500                -
Sale of businesses                                       3,400                -
Costs of disposal                                        (824)                -
                                                         3,100                -


Financing

Issue of ordinary share capital                              1,899            -
Repayment of secured loan                                    (687)        (225)
Capital element of finance lease rental payments             (148)        (193)
                                                             1,064        (418)



7.         Analysis and reconciliation of net debt


                                                                             31
                                                                       December
                                          1
                                          January                          2000
                                                            Cash
                                             2000           flow
                                            £'000          £'000          £'000
Overdraft                                 (2,930)          2,586          (344)
Bank loans                                  (687)            687              -
Finance leases                              (203)            148           (55)
                                          (3,820)          3,421          (399)
Debt due after one year                     (274)            274              -
Debt due within one year                  (3,343)          2,999          (344)
Finance leases                              (203)            148           (55)
Net debt                                  (3,820)          3,421          (399)

                                                            2000           1999

                                                           £'000          £'000
Increase (decrease) in cash in the                         2,586          (586)
year
Cash outflow from decrease in debt and lease                 835            418
financing

Change in net debt resulting from                          3,421          (168)
cash flows
New finance leases                                             -           (98)
Movement in net debt in year                               3,421          (266)
Net debt at 1 January 2000                               (3,820)        (3,554)
Net debt at 31 December 2000                               (399)        (3,820)



8.         Reserves
                            Share                            Profit
                          premium                          and loss
                          account       Revaluation         account

                                            reserve                       Total
                            £'000             £'000           £'000       £'000
At 1 January 2000           5,259               462         (3,011)       2,710
Retained loss for               -                 -         (5,191)      (5,191)
the year
Disposal of                     -             (462)             462           -
revalued property
Goodwill                        -                 -             271         271
previously
written off to
reserves
Share capital               1,667                 -               -       1,667
issued
Expenses of                 (325)                 -               -       (325)
equity share
issue
At 31 December              6,601                 -         (7,469)       (868)
2000



9.                  The basic loss per share has been calculated on the loss
before and after taxation of £5,191,000 (1999: £1,635,000) and on the weighted
average number of shares in issue of 17,805,487 (1999: 12,325,841).  The basic
before exceptional items loss per share has been calculated on a loss of £
3,502,000 (1999: £956,000) and on the weighted average number of shares in
issue of 17,805,487 (1999: 12,325,841).



10.              The directors do not recommend the payment of a final
dividend and the dividend for the year is therefore nil (1999: nil).



11.              The results have been prepared under the historical cost
convention as modified for the revaluation of certain fixed assets and in
accordance with applicable accounting standards.  The accounting policies have
been applied consistently with those stated in the previous accounts.



12.              The financial information set out above does not comprise the
company's statutory accounts.  Statutory accounts for the previous financial
year ended 31 December 1999 have been delivered to the Registrar of Companies.
  The auditors' report on those accounts was unqualified and did not contain
any statement under section 237(2) or (3) of the Companies Act 1985.  The
auditors have not reported on accounts for the year ended 31 December 2000,
nor have any such accounts been delivered to the Registrar of Companies.



13.              This preliminary announcement was approved by the Board of
directors on 2 March 2001 on the assumption that the approval of the proposed
sale of the fixings and gardening divisions is obtained at the EGM to be held
on 26 March 2001.



14.              The directors intend to approve the full financial statements
following shareholder approval of the proposed sale of the fixings and
gardening divisions at the EGM to be held on 26 March 2001.