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Future Integrated (FUR)

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Wednesday 28 February, 2001

Future Integrated

Interim Results

Future Integrated Telephony PLC
28 February 2001

                       Future Integrated Telephony Plc

         Interim Results for the six months ended 30th November 2000

Future Integrated Telephony PLC, is a business to business supplier of
telecommunication solutions to the SME market. The company today announces its
interim results for the six months ended 30th November 2000.

*     Revenues up 22%

*     New distribution trials underway with a major utility and a property

*     5800 new customers acquired from plc

*     New mobile Division delivering over 1,000 connections per month

*     Business to Business portal launched in November

*     Online banking and e-commerce services agreement in place with Bank of

*     Strengthened management team effective 1st March

        - Peter Howell-Davis appointed as Chairman

        - Ted Stocker OBE appointed Chief Executive

Ted Stocker OBE, Chairman of Future Integrated Telephony commented:

'It has been a difficult six months but the recent initiatives and marketing
agreements we have put in place will allow us to move forward on a stronger
footing. I am confident that the Group now has the right business plan and
infrastructure in place to generate growth and profit going forward.'

                                                              28 February 2001

Future Integrated Telephony Plc                   Tel: 02476 658000

Ted Stocker, Chairman
College Hill                                      Tel: 020 7457 2020

James Henderson

Chelsea Allen

                           CHAIRMAN'S STATEMENT FOR

                     SIX MONTHS ENDED 30TH NOVEMBER 2000

The results for the half-year ended 30th November 2000 disclosed that turnover
increased by 22% over the corresponding period to £5.106m (1999: £4.17m). The
loss before and after tax, but after an exceptional credit of £796,000, for
the six months ended 30th November 2000 has increased to £1.191m (1999:£
307,000). The loss per share was 8.59p (1999: 2.63p).


We are well on our way to transforming Future Integrated Telephony from being
a Telecommunications Service supplier into being a full Business Services
supplier, building on our telecommunications services and adding others via
our business-to-business portal. The Group's defined strategy is to both
increase the number of customers and at the same time improve the value of
those customers by selling an increased number of services. We now have a
Company that sells and maintains PBX's and is able to provide fixed, mobile
and internet services on a single bill for its whole customer base. The number
of customers has increased month by month throughout this period.

The Company previously reported that it had incurred significant costs in this
trading period recruiting and training the additional staff required for
expansion in anticipation of increased volumes from the agreement with
Independent Energy. Following Independent Energy's receivership on 15th
September 2000 the board acted quickly to establish early contact with Innogy
PLC, the purchaser of the assets of Independent Energy along with the other
agents providing the sales resource to determine their viability and interest
in maintaining a Future telecommunications service as part of their ongoing
offering into the acquired customer base. Failure to reach agreement and an
ongoing solution, capable of delivering the previously expected volumes of CLI
connections released Future to explore new opportunities and alternative
partnerships since November 2000. Independent Energy's failure to provide the
target number of connections also meant that the expected cash injection of £
4M arising from the exercise of the share option arrangements under the
marketing agreement did not materialise.

We have gained positive experience and a good understanding of the energy
utility market during this period and the company has been able to implement a
new marketing agreement with a major utility company in February 2001. Future
has entered into a joint agreement to run significant trials with this utility
partner over the next 3 to 6 months. A successful conclusion to these trials
will add significant revenue in the second half of the year, and the broader
implementation of the service will underpin profitability longer term. No
benefit on sales or revenue from this agreement has yet been realised in the
period on which we are reporting.

The Company has reached agreement with Synergie.Net Plc, a telecommunications
company with interests in least cost routing and Internet services, whereby
Future has acquired 5800 new customer connections. This agreement will now be
extended and is expected to produce 2500 new connections per month. These new
customers already have an established usage that will mean an immediate
generation of revenues and margin for the group.

The Mobile Division, which commenced trading in May 2000, has seen steady
progress during this operating period and a sales level of over 1000
connections per month is now being reached This will give us significant
benefit in the second half of the year and provide an excellent platform for
expanding our mobile division.

We previously announced the acquisition of Alan Stephens Associates Ltd on 1st
June 2000 with the objective of developing an Internet Portal and a range of
associated services specifically for the SME market. We successfully launched
the portal in November 2000, delivering a wide range of
online services to our SME customers, including access to online, billing
information. We have continued to develop a Business Internet Package for SME
businesses, which includes unlimited Internet access and hosting, business
email and web site design software and services. A five year agreement and
strategic alliance has been signed with Bank of Scotland, which will underpin
our Internet services with a range of e-commerce solutions for SME business
and deliver integrated online banking and financial services to our business
customers via our Internet business portal.

This is an exciting development for the whole business and we are delighted to
announce that full access to this new service to our customers and channel
partners will commence during March 2001.

The arrangements with the property investment company to provide data and
telecoms services into their property portfolio are now underway. Services are
now been provided at six locations and a market penetration of 32% has been
achieved. It is now intended to roll out these services to an additional 96
sites in the immediate future.

The Company has also made significant progress in streamlining and improving
its internal processes so that a larger volume of business can be handled
efficiently. A new telesales centre has been opened in Burnley to provide
additional appointments for our expanding sales force. This is improving the
productivity of our sales force, increasing the number of qualified
appointments per sales person. The expected increase in sales will therefore
attract fewer overheads and speed the return to profitability.

Board Changes

The Company has to report that Mr David Sims, the Company's Chief Executive,
has left the Company with effect from 28th February 2001. As a result of this
the Board has been restructured in order to further develop the sales
opportunities and to appoint a chairman with broader experience.

E J (Ted) Stocker OBE will resume the role of CEO and be responsible for
driving sales across all business units and channels going forward. The
company is confident that Ted's extensive industry background will add new
impetus to sales and customer services.

The Company will continue to seek a suitable replacement for the role of CEO,
and when appointed Mr. Stocker will become a Non Executive Director.

P (Peter) Howell-Davies, who joined the Board as a Non Executive Director in
April 2000 will become Chairman of the Company and will work closely with Ted
Stocker OBE. Peter previously held executive roles as chief executive officer
at Mercury Communications Ltd and chief executive officer of Optus
Communications Australia. He has a lifetime's experience of the
Telecommunications Industry and is currently chairman of Optimal
Communications Ltd and of The Voice Company Pte Ltd Singapore as well as being
a non executive of Netstore plc.

The Board also comprises of the following experienced individuals

S (Steve) Willock. He joined the Board in June 2000 upon the acquisition of
Alan Stephens Associates Limited. He is responsible for the development and
introduction of the Business 2 Business Portal and Internet
Services and the expansion of our core skills to include software for web site
creation and hosting products, plus bespoke design and production services for
business Internet, Intranet and Extranet solutions.

Steve's experience in Marketing has been invaluable in building a new brand
strategy for FIT4Business and developing a clear communications programme to
support all of our sales channels going forward.

T (Terry) Hutchinson, the Group Financial Director, who has been with the
Company since November 1999, has 25 years experience at PLC board level.

A (Alan) Hindley, Non Executive Director. Alan joined the Board in July 1999
and has considerable experience with the Telecommunications, Data and Internet
industry including positions as group managing director of ntl
telecommunications and Telecom director of the UK division of Vivendi. Alan is
currently chairman of Convergence Group plc, Woolfall plc and Keycom plc

The Future

Our key objective is to provide excellent customer service, whilst continuing
to drive the sales sharply upwards. In parallel with growing the customer
base, we are now cross selling the Company's products into the existing base
therefore increasing the sales value of each customer.

The organisation is in good shape as we continue to build on the new business
areas we continue to accelerate the improvement in profitability. We have
signed an agreement with Viatel to carry our Least Cost Routing traffic
resulting in an overall improvement of margin.

In the telecoms market we saw an increasing demand from customers for the
integration of both their data and telecoms requirements. The Company has
introduced new products into its portfolio to be able to effectively meet this
changing customer requirement.

The increase in rate of connecting customers will have an impact on the
working capital requirements for the Company. Arrangements are in place for
the provision of sufficient working capital for the planned expansion of the
company. The terms for this facility are agreed, subject to the completion of
due diligence in the first week March 2001. The business has the ability to
manage its product mix and associated overhead to optimise the use of working

The Board have reacted quickly to the challenges of this six month period, and
through improved infrastructure and by realising new opportunities with our
larger customers and channel partners, we can now look forward to a period of
accelerating sales. These improvements in internal processes enable us to
handle large volumes of business effectively. The Directors now anticipate
that the Company will enter the next financial year building volume and
improving profit on a month by month basis.

We have a Company in good shape, a clear strategy and a strong management
team. We look forward with increasing confidence to providing the type of
return that our shareholders have every right to expect.

Group profit and loss Account for the six months ended 30 November 2000

                                          Unaudited          Unaudited  Audited
                                         Six months         Six months     Year
                                              ended              ended    ended
                                             30 Nov             30 Nov   31 May
                                               2000               2000     2000

                                Normal  Exceptional Total        Total
                                 £'000        £'000 £'000        £'000    £'000
Turnover                         5,106                           4,176    8,229

Cost of Sales                   (3,805)              (3,805)    (2,685)  (5,761)
Gross Profit                     1,301               1,301       1,491    2,468
Selling and distribution costs  (1,716)              (1,716)      (925)  (2,260)
Administrative expenses         (1,686)          796 (890)        (876)  (3,597)
Operating Loss                  (2,101)          796 (1,305)      (310)  (3,389)
Interest receivable                115                115            5       85
Interest payable                   (1)                (1)           (2)     (17)
Loss on ordinary activities     (1,987)          796 (1,191)      (307)  (3,321)
before taxation
Taxation (Note 2)                                       0                     0
Retained loss                   (1,987)          796 (1,191)      (307)  (3,321)

Loss per share -- basic (Note                       (8.59p)     (2.63p) (27.33p)

The interim results do not comprise full accounts within the meaning of
Section 240 of the Companies Act 1985. Full accounts for the year ended 31 May
2000, on which the auditors gave an unqualified report, have been delivered to
the Registrar of Companies.

Group Balance Sheet at 30 November 2000

                                         Unaudited     Unaudited       Audited
                                         At 30 Nov     At 30 Nov     At 31 May
                                              2000          1999          2000
                                             £'000         £'000         £'000

Fixed assets
Intangible assets                            1,427             0             0
Tangible assets                                833           372           539
                                             2,260           372           539
Current assets
Stocks                                         490           299           541
Debtors - due within one year                2,348         1,857         1,899
- due after more than one year                 322             0           217
Cash at bank and in hand                     2,081             0         5,696
                                             5,241         2,156         8,353
Amounts falling due within one year        (2,469)       (2,419)       (2,721)
Net current assets/(liabilities)             2,772         (263)         5,632
Total assets less current                    5,032           109         6,171
Amounts falling due after one year            (18)             0             0
Accruals and deferred income                 (367)         (377)         (363)
Provisions for liabilities and                   0             0         (796)
Net assets/(liabilities)                     4,647         (268)         5,012

Capital and reserves
Called up share capital                        694           583           681
Share premium account                       12,018         3,009        11,205
Merger reserve                               (245)         (245)         (245)
Profit and loss account                    (7,820)       (3,615)       (6,629)
Shareholders' funds                          4,647         (268)         5,012

Group Cash Flow Statement for the six months ended 30 November 2000

                                                    Unaudited Unaudited Audited
                                                         Six       Six        
                                                      months    months     Year
                                                       ended     ended    ended 

                                                      30 Nov    30 Nov   30 May 

                                                         2000      2000    2000
                                                        Total     Total
                                                       £0'000     £'000   £'000

Net cash flow from operating activities               (2,538)   (1,032) (2,986)
Returns on investments and servicing of finance           114        3      68
Capital expenditure and financial investment            (336)      (99)   (351)
Acquisition of Alan Stephens Associates Ltd             (856)
Net cash outflow before use of liquid resources       (3,616)   (1,128) (3,269)
and financing
Management of liquid resources                          2,500           (4,000)
Issue of shares                                             9             8,294
Decrease in debt                                          (8)       (9)    (19)
(Decrease)/Increase in cash in the period             (1,115)   (1,137)   1,006

Reconciliation of net cash flow to movements in
net debt
(Decrease)/Increase in cash in the period             (1,115)   (1,137)   1,006
Cash inflow from decrease in debt                          8         9      19
Cash outflow/inflow from decrease/increase in         (2,500)             4,000
liquid resources
Movement in net funds in the period                   (3,607)   (1,128)   5,025
Net funds at start of period                            5,686       661     661
Net funds at end of period                              2,079     (467)   5,686

Reconciliation of operating loss to net cash flow
from operating activities
Operating profit                                      (1,305)     (310) (3,389)
Depreciation charges                                      223        69     154
Increase in accruals and deferred income                    4        33      19
(Decrease)/Increase in provisions for liabilities       (796)               796
and charges
Decrease/(Increase) in stocks                              73      (73)   (315)
Increase in debtors                                     (302)     (574)   (833)
Increase in creditors                                   (435)     (177)     582
                                                      (2,538)   (1,032) (2,986)

Purchase of Alan Stephens Associates Ltd
Net assets required                                               £'000
Tangible fixed assets                                             105
Stocks                                                            22
Debtors                                                           252
Cash at bank and in hand                                          69
Creditors                                                         (184)
Finance lease obligations                                         (25)
Goodwill                                                          1,503

Satisfied by
Shares allotted                                                   817
Cash - consideration                                              850
Cash - acquisition costs                                          75

Notes on the Interim Report

 1. Director's responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. They are
responsible for ensuring that the accounting policies and presentation applied
to the interim figures are consistent with those applied in preparing the
preceding annual accounts except where any changes, and the reasons for them
are disclosed.

2)Exceptional items

Exceptional items in the six months ended 30 November 2000 comprises the
release of an accrual for Employer's National Insurance on the exercise of
share options. Administration costs to 31 May 2000 include an exceptional
amounting to £1,335,000 that predominately relates to National Insurance
arising on the granting of share options.


There is no tax charge for the half year due to unrelieved tax losses in
current and prior periods.


No interim dividend is being proposed or paid.

5)Loss per share

Loss per share has been calculated in accordance with FRS14 and is based on
the loss after taxation and on the weighted average number of shares in issue
throughout the period of 13,858,996 shares. (Six months to 30 November 1999
11,654,348 shares, Year to 31 May 2000 12,149,521 shares.)


The interim financial information in this report has been neither audited nor
reviewed by the group's auditors

Copies of this statement will be sent to all shareholders and are available on
request from the registered office of the company, Future House, Brandon
Court, Progress Way, Coventry, CV3 2NT.


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