RNS Number:7518J
Robotic Technology Systems PLC
08 April 2003







                         ROBOTIC TECHNOLOGY SYSTEMS PLC
                     ("RTS", "the Company" or "the Group")

              Preliminary results for year ended 31 December 2002

RTS is a high technology business specialising in providing automation systems
and software for a range of sophisticated scientific and industrial processes.


                                                                                  2002          2001
                                                                                    #m            #m

Turnover on Continuing Operations                                                  66.9        123.4


Continuing Operations operating (loss)/profit before tax, exceptional             (6.2)         10.5
items and acquisition goodwill amortisation


Exceptional items, goodwill impairment, goodwill amortisation and                (28.4)        (7.4)
termination of business segment
(#22.4 million non-cash)


(Loss)/profit before tax                                                         (34.6)          3.1


(Loss)/earnings per share (p)
     Basic                                                                     (59.20)p        2.56p
     Diluted                                                                   (59.20)p        2.46p


Adjusted (loss)/earnings per share on Continuing                               (11.47)p       11.11p
Operations before exceptional items and acquisition
goodwill amortisation


Key Points

*    UK businesses remain buoyant with record profits
-        Life Sciences increased sales by 13%.
-        Nuclear Solutions in UK grew sales by 21%.



*     Extremely difficult trading conditions persisted in the US during the
second half.  US operations are now structured in line with demand.
-         Employee numbers reduced by 330 in US
-         Cost savings of #6 million annualised in US.
-         Closure of Phoenix US plant.



*  Order book just under #40m


*  Disposal and exit from loss-making operations in Finland.


*  Strong balance sheet with minimal debt maintained.


*  Net tangible assets per share 58 pence


*  Collins Stewart Limited appointed today as financial adviser and stockbroker.



Chris Brown, Chairman of RTS said:



"The Group has operated in an extremely harsh climate in the US that has
demanded swift and decisive management action which we have taken.  We have
demonstrated that we have the ability both to grow businesses  and to deal with
difficult market conditions.  We are confident that the market for automated
technology, which is now fundamental to industry, will resume growth when
customer confidence returns".



                                                                    8 April 2003

Enquiries:
Robotic Technology Systems Plc                          Tel: 020 7457 2020 (today)
Phil Johnson, Chief Executive Officer                   Tel: 0161 777 2000 (thereafter)
David Timmins, Group Finance Director

College Hill                                            Tel: 020 7457 2020
Matthew Smallwood



Chairman's Statement



In 2002 the Group generated significant organic growth in Life Science and the
domestic Nuclear Solutions businesses where conditions remained favourable but,
more importantly, where we outperformed the market. The depressed state of the
industrial capital equipment market, however, dominated our business in the US.



Group Results



In the year to 31 December 2002, turnover was #70.6 million compared to #131.3
million for the prior year.  Turnover from Continuing Operations for the year
ended 31 December 2002 was #66.9 million (2001 : #123.4 million), having
successfully disposed of two loss-making businesses in Finland and having
closed, in February 2003, the Phoenix plant in the US which had become heavily
loss-making.  Strong turnover growth in Life Science and the UK division of
Nuclear Solutions of 13% and 22% respectively were more than offset by the
significantly reduced turnover in Assembly Systems and Build-to-Print in the US.
  These two business groups were most affected by the severe downturn in the US
industrial market place since the second quarter of 2001.



The substantial reduction in Group turnover has had a large detrimental impact
on the Group's profitability.  The loss on Continuing Operations at the EBITDA
level before exceptional items was #3.3 million compared to a positive EBITDA of
#9.9 m in the prior year.  The loss at EBITDA level was contained to that amount
by the implementation in our US operations of decisive and severe cost reduction
programmes together with the benefits derived from improvements in operational
efficiencies.  Employee numbers in the US have reduced by 330 since the
beginning of 2002, which, together with other measures has realised permanent
cost savings of #6.0 million on an annualised basis.



Continuing Operations operating loss before exceptional items and acquisition
goodwill amortisation amounted to #6.0 million versus an operating profit of
#10.1 million on a comparable basis.  On the same basis, the loss after tax was
#7.0  million (2001 : profit after tax #8.8 million) giving a basic loss per
share of 11.5p (2001 : earnings per share 11.1p).



An exceptional item of #18.1 million was incurred during the period mainly
comprising an impairment charge under FRS 11 relating to the acquisition of RTS
Wright Industries, LLC (non-cash).  In addition, a provision of #5 million for
losses on termination of business segments in the US and Finland was made, of
which #3.8 million are non-cash items.



As a result, the total operating loss for the year was #29.4 million (2001:
operating profit #2.7 million) with a loss before tax of #34.6 million (2001:
profit before tax #3.1 million)



Despite the overall weak trading performance in the year, the Group's balance
sheet remains strong and is geared at approximately 10%.  At the year end the
Group had cash of #3.6 million, undrawn borrowing lines of #6.3 million and
immediately convertible cash investments of #1.7 million.



Group Structure



The disposal of the two businesses in Finland has effectively completed the
Group's exit from that country.  The closure of the Phoenix plant in the US was
completed at the end of February 2003.  The Group is now in a much better
position to concentrate on the two UK-led profitable and growing businesses and
RTS Wright Industries, LLC in Nashville, USA.



Move to the Official List



The admission of the Company's shares to the Official List was completed in
August 2002 which the Board believes will enhance the status of the Company,
increase liquidity in its shares and extend its shareholder base.





Board Changes



During the year Dr Max Honkanen retired from the Board at the last Annual
General Meeting and I would like to take this opportunity to thank Max for his
service to the Company.  John Heller joined the Board as a non-executive
director in September 2002 bringing the combination of an astute legal mind and
business acumen. Mike Macsek resigned from the Board on 25 February 2003 but
continues to serve as President and Chief Operating Officer of RTS Wright
Industries, LLC concentrating on technical management and business development.



Dividends



As in previous years, no dividend is proposed for the year.



Brokers



I am pleased to announce the appointment today of Collins Stewart Limited as
financial adviser and stockbroker to the Company.





Outlook



US operations have been downsized further than could have been anticipated a
year ago and permanent, annualised cost savings related to this of some #6.0
million should be realised in 2003.  The two loss-making businesses in Finland
have been sold and the Phoenix plant closed, thereby freeing up management time
to drive the profitable UK-based businesses forward, and to manage the US
operations back to profitability.



The order book now stands at just under #40 million.  Quotation activity in the
US operations remains at an encouraging level but the air of uncertainty we have
seen over the last 24 months from our customers in making investment decisions
shows little sign of abating.  In contrast the outlook for our Life Science
business and UK-based nuclear business remains strong.




Chris Brown
Chairman



8 April 2003




Chief Executive's Report


The international markets for automation technology experienced widely varying
economic climates throughout 2002. Our ongoing Life Science business generated
13% growth in sales and also achieved a record order input of nearly #20m, a 57
% increase over 2001, with bookings in both Europe and the US, giving us a
strong order book of #14 million going into 2003.  The Nuclear Solutions
business in the UK performed well with sales of #9.5m, which represents growth
of 22%.  The main focus of management attention throughout the year, however,
has been on our operations in Nashville and  Phoenix in the US where industrial
capital spend on automated manufacturing capacity was at a low level throughout
2002 following rapid market decline during the second quarter of 2001. Our US
operations have now been significantly downsized and reorganised to bring costs
into line with business volumes and we have appointed a new Chief Executive
Officer there to continue the drive to a return to profitability.



Organic growth in the UK together with the downsizing in the US has reduced the
dominance of the US-based operations in the Group which now has approximately
50% of its business operation in each of these two geographical regions.



MAJOR CORPORATE EVENTS



Disposal of the business and assets of Cheos Oy



As the business of the Group has developed, and our vision technology has become
more widely understood in the UK, reliance on technical knowledge in Finland has
reduced. The main business of Cheos Oy was the configuration and distribution of
machine vision hardware and instrumentation into the Finnish market. This was a
small and non-core activity for the Group which was heavily dependent on the
level of research and development spend in the Finnish domestic economy. The
business and assets of Cheos Oy, which had been loss-making, was sold to
management in September 2002 for Euro100,000.



Disposal of the business and assets of RTS Robotics Oy



RTS Robotics Oy supplied robotic automation systems largely into the Finnish and
Scandinavian manufacturing market and was the development authority for RTS
Vision Integration PlatformTM (VIP) and FlexMillTM software.  Support capability
for our software products has strengthened as strategic technology transfer has
progressed and the UK technology skills base has developed following the
acquisition of UK Robotics Ltd in 2000 and its subsequent integration into the
Flexible Systems International business. It was appropriate therefore to move
responsibility for the ongoing development of VIP and FlexMillTM to the UK where
international support and effective programme management could be provided more
cost effectively.



The robotic systems business and assets of RTS Robotics Oy was loss-making,
especially following the downturn in capital spending in European manufacturing,
and was sold to management for  Euro25,000. The Group has entered into a one year
agreement to licence to the MBO company the use and resale of RTS Robotics Oy's
software technology for a fee of Euro100,000.





OPERATIONAL REVIEW



Our Life Science business in drug discovery in the pharmaceuticals industry has
continued its strong expansion path generating underlying organic growth of 13%
with sales of  #15.6 million and record order input of approximately #20
million, a 57% increase over the prior year. With orders being placed for both
Europe and the US we have outperformed the market in this sector and the
investments we made to expand our Manchester base have been fully justified. The
additional factory and office space provided in 2002 is being used to excellent
effect and recruitment has continued throughout the year for both sales and
technical staff.



The Nuclear Solutions business in the UK has continued to be successful with
sales growing 21% to #9.5 million and the relationship with British Nuclear
Fuels, our major customer, has continued to prosper. This year has seen our role
expand to provide Design Integrator services, starting to manage the design
activities of multiple technical specialist suppliers to provide an integrated
design approach to activities ranging from continued operation safety
assessments to large capital projects.



In the fast-evolving market place our Fibers Technology International business
group has found that its process skills are opening up new business
opportunities that offer clear differentiation from many of its traditional
competitors. Its name has therefore been changed to 'Process Systems
International' which better reflects its wider capability. It is now targeting
new and exciting opportunities such as the potential market for specialised
equipment to manufacture biodegradable, disposable food packaging for the fast
food industry which could replace those made from polystyrene and paper.



Demand for automated manufacturing systems in the technology and general
industrial sectors of the US market remained depressed throughout 2002. Order
input recovered from the very lowest levels at the end of 2001 to the summer of
2002 after which it again declined as buying decisions were postponed in the
light of market uncertainty, probably exacerbated by the threat of war in the
Middle East. Managing this situation has been the focus of our management
attention throughout the year.



In the light of the depressed market we have continued to cut costs in our US
operations particularly during the second half of the year. It was for this
reason that we took the decision to close the smaller RTS Wright facility in
Phoenix, Arizona, which housed our US Flexible Systems business, choosing to
concentrate our efforts on Nashville, our largest site.  Robotic systems, based
on the Company's products, for the US market place will be designed and
manufactured in Nashville supported by the Flexible Systems business group which
is now based in Manchester following the disposal of the business of RTS
Robotics OY during the year.



We have maintained a strong core capability within RTS Wright and taken the
opportunity to initiate changes which should permanently improve our
performance. The sales function in Nashville has been re-organised to ensure
that it works closely at all times with operational management and that we have
maximum focus on key accounts in the right market sectors as business recovers.
Management in Assembly Systems has been strengthened under a new business group
manager and its organisation is being developed to ensure that we can profitably
handle the smaller projects which are now a feature of the market place. We have
also initiated the development of a new supply chain management organisation
with a mission to drive down the costs of both purchased and manufactured parts
and ensure that we take full advantage of  relationships with our suppliers.
This is an area where there is an excellent opportunity to  improve gross
margins.



MANAGEMENT



A number of significant management changes have been made in the US during the
last year. We have accelerated the programme of change which was already
underway within RTS Wright to develop the business by reducing costs, increasing
productivity and targeting market sectors which would produce better margins.
The management team in RTS Wright, in particular, has been strengthened as we
have downsized and reorganised and senior personnel have been recruited where
new skills and wider experience have become necessary.



Mark Taylor was recruited as Chief Executive Officer of RTS Wright Industries,
LLC in February  2003 to drive business innovation and change in our largest
subsidiary. Following 8 years as President of David Brown North America, a
successful manufacturer of customised industrial gear boxes, Mark became Vice
President and General Manager of Cone Drive Textron following Textron's
acquisition of David Brown plc in 1998. He then became Vice President Global
Sales and Marketing for the Textron Power Transmission Division.



Mike Macsek, the President and Chief Operating Officer of RTS Wright, is now
dedicated to operational and technical management and specific areas of business
development where his contribution is most valuable to the company.  Joel
Pepper, one of our strongest and most experienced managers, is now leading
Assembly Systems International. Al Vaughan has begun the development of the
supply chain management organisation within RTS Wright.  He has a proven track
record in this specialised area and has been recruited to lead this.





PRODUCT DEVELOPMENT



Product development continued throughout 2002 in areas where enhanced technology
will improve our competitive advantage or a new product is required for entry
into a new market.



Our Life Science business group has completed the development of 'Sample Store',
a new high density compound store which is aimed at smaller biotechnology and
pharmaceutical companies therefore widening our potential market. They have also
invested in significant enhancements to 'Sprint', our robotic cell management
and scheduling software product, enhancing its user appeal. The development of
'acCellerator TM', our automated cell culture system, has progressed throughout
the year.   We have continued to invest in the design of industrial scale
automation for Ultra High Throughput Screening of samples for drug discovery,
allowing extended unattended testing to reduce timescales.



The Flexible Systems group has continued to develop new product inspection and
detection algorithms for Vision Integration Platform (VIP), our machine vision
software product, expanding its capability and its market potential.


The Process Systems International Business Group which operates within RTS
Wright has entered into an agreement with Earthshell Corporation of California
to develop and manufacture equipment enabling the unique Earthshell process to
be used to manufacture biodegradable single use food containers for the food
service industry, with the aim of replacing polystyrene and paper products with
an environmentally friendly and cost effective alternative. Equipment is being
developed by RTS which could enable Earthshell's licensed business partners to
exploit this process efficiently and cost effectively. The market for single use
food containers is estimated to be $10 billion in the US and $25 billion
worldwide.




OUTLOOK



Our international Life Science and domestic Nuclear Solutions businesses
continue to be active and buoyant. We came into this year with a strong order
book in these areas and we are currently confident that they should exceed their
business plans for 2003. We have significantly reduced the cost base of our US
business, refocused our sales force there and introduced major changes to ensure
that it is competitive going forward and returns to profitability.  From our
perspective, however, the US industrial market for capital equipment is still
full of uncertainty, customers are still hesitant in proceeding with their own
major initiatives and the business available to us is significantly below the
levels of previous years. The long period of political uncertainty surrounding
the Middle East and the onset of war with Iraq have all added to the unease in
the market place and at present it is difficult to predict when there will be a
shift in sentiment.



We are confident however that automation technology is now fundamental to
industry and that demand will increase as our customers' confidence in their own
business situation begins to return.




Phil Johnson
Chief Executive Officer



8 April 2003



Group Finance Director's Review



Turnover and gross margin



Turnover for the year ended 31 December 2002 decreased to #70.6 million from
#131.3 million for the prior year, which represented a decrease of 46.2%.  On a
Continuing Operations basis, turnover for the year ended 31 December 2002
decreased by 45.8% to #66.9 million from #123.4 million on a like-for-like
basis.



On a Continuing Operations basis, Life Science turnover increased by over 13% to
#15.4 million (2001 : #13.6 million) and the UK division of Nuclear Solutions
increased by nearly 22% to #9.5 million (2001 : #7.8 million).   The rest of the
Group's businesses, however, was severely impacted by the very difficult trading
conditions in the US industrial capital spend market place.  The reduction in
turnover in Assembly Systems and Build-to-Print, compared to the prior year, of
#35.2 million and #14.8 million respectively contributed substantially to the
overall decrease in Group turnover.



Discontinuation of operations primarily affected the Flexible Systems results
and reflected the sale of the Finnish businesses to local management in the
second half of the year as well as the closure of the Phoenix operation in
February 2003, for which anticipated closure costs were provided in the
financial statements for the year ended 31 December 2002.



The combination of significant cost-saving measures, improvements in operational
efficiencies and a strong performance in Life Science, the Group's highest
margin business, offset, in part, the effects on gross margin of adverse and
highly competitive market conditions in the US and contained its decrease to
25.8% from 28.5% in the prior year.  On a Continuing Operations basis, gross
margin for the year was 26.6% (2001 : 28.1% on a comparable basis) with the
second half at 27.1%, a point higher than the first half.



Distribution and administrative costs



Ongoing distribution and administration expenses for the year ended 31 December
2002 decreased by more than #2 million compared to the prior year which resulted
from a substantial cost reduction programme in the US commencing in May 2002 and
continuing through to March 2003.  The full annualised benefit of these cost
reductions will be reaped in 2003 together with cost savings to be realised from
the closure of the Phoenix plant at the end of February 2003.



Exceptional items



In accordance with the provisions of FRS 11, an acquisition goodwill impairment
of #16.4 million has been charged to the profit and loss account in the current
year which relates mainly to the acquisition of RTS Wright Industries, LLC in
May 2000.  This is a non-cash charge.  Further exceptional costs incurred in the
current year amounted to #1.8 million mainly comprising #0.7 million
restructuring costs at RTS Wright and #0.8 million legal and professional fees
in connection with two aborted acquisitions, the move to the Official List in
August 2002 and an accelerated write-off of advisory costs in connection with
tax planning measures.



In the prior year, as a consequence of the appointment of administrative
receivers to RTS NetWorks Group PLC on 31 January 2002, an amount of #2.1
million was written off to the profit and loss account to reflect a permanent
diminution of a current asset investment.



A loss on termination of business segments of #5.0 million was charged to the
profit and loss account in the year ended 31 December 2002 of which  #3.8
million is non-cash  and relates primarily to that proportion of the original
acquisition goodwill of RTS Wright Industries, LLC attributable to the Phoenix
plant.  The balance of the charge relates to a provision for the carrying values
of tangible fixed assets in Phoenix and recognises the liability under its
property and asset leases.



Loss before tax



The loss before tax for Continuing Operations, before exceptional items and
acquisition goodwill amortisation, for the year ended 31 December 2002 amounted
to #6.2 million compared to a profit before tax in the prior year on a
comparable basis of #10.5 million.



Taxation



There is no current tax charge in respect of the profitable UK businesses due to
research and development credits and short asset life election claims.  The
Group tax charge in the current year primarily relates to the reversal of a
prior year deferred tax credit.  In the US tax group, significant tax loss carry
forwards together with some #7 million of US tax allowances will be available to
offset against future taxable profits in the US.



Earnings per share



The adjusted loss per share on Continuing Operations before exceptional items
and acquisition goodwill amortisation was 11.5p compared to earnings per share
in the prior year of 11.1p on a comparable basis.  The basic loss per share for
the year was 59.2p (2001: earnings per share 2.56p) based on the overall loss
after tax of #35.5 million (2001: profit after tax #1.4 million).



Cash flow and borrowing facilities



The net cash outflow from operating activities for the year amounted to #6.0
million which approximates to the operating loss on Continuing Operations before
exceptional items and acquisition goodwill amortisation.  There was a reduction
in the working capital requirement of #1.4 million in the year.  The Group
finished the year with #3.6 million in cash and net debt of #5.9 million.  As at
31 December 2002, the Group had undrawn bank operating lines of credit amounting
to #6.3 million and investments of #1.7 million in life insurance policies held
beneficially by the Group which can be realised at any time.



Treasury policy



The Group's treasury policy aims to ensure that adequate financial resources are
available to develop the Group's business whilst managing its currency and
interest rate risks.  The Group's policy is not to engage in speculative
transactions.



Disposals



During the year the Group disposed of the business and assets of two subsidiary
companies both based in Finland.  On 29 September 2002, the business and assets
of Cheos Oy, which had become a non-core part of the Group, were disposed of to
local management for a consideration of Euro100,000.  On 29 November 2002, the
Group disposed of the trade and assets of RTS Robotics Oy for Euro25,000 but
retained the rights to the existing intellectual property and technology.    The
Group has granted the MBO company a licence to use its software technology for
12 months at a fee of Euro100,000.   The businesses sold during the year did not
have a material impact on Group cash flow.



David Timmins

Group Finance Director



8 April 2003




Robotic Technology Systems PLC

Group profit and loss account for the year ended 31 December 2002


                                                          Note       Year ended 31 December 2002
                                                                Continuing  Discontinued              Year ended
                                                                operations  operations                31 December
                                                                                                Total         2001
                                                                      #'000         #'000       #'000        #'000
Turnover                                                   2         66,893         3,666      70,559      131,345


Cost of sales                                                      (49,104)       (3,259)    (52,363)     (93,922)
Gross profit                                                         17,789           407      18,196       37,423

Distribution costs                                                  (3,738)         (599)     (4,337)      (5,691)

Administrative expenses before exceptional items                   (21,997)       (3,168)    (25,165)     (27,195)
Exceptional items
  Acquisition goodwill impairment                                  (16,400)             -    (16,400)            -
  Impairment of intangible fixed assets                               (308)             -       (308)         (64)
  Legal and professional fees                                         (816)             -       (816)            -
  Restructuring costs                                                 (648)             -       (648)            -
  Provision against current asset investments                             -             -           -      (2,075)


Total administration expenses                                      (40,169)       (3,168)    (43,337)     (29,334)


Operating (loss)/profit before exceptional items and                (7,946)       (3,360)    (11,306)        4,537
other operating income
Other operating income                                                   39            15          54          279

Operating (loss)/profit                                            (26,079)       (3,345)    (29,424)        2,677


Loss on termination of business segments                                  -       (4,972)     (4,972)         (26)

(Loss)/profit on ordinary activities                               (26,079)       (8,317)    (34,396)        2,651
  before interest and taxation


Interest receivable                                                                               212          546
Interest payable                                                                                (427)        (122)
                                                                                                (215)          424


(Loss)/profit on ordinary                                                                    (34,611)        3,075
   activities before taxation


Taxation on (loss)/profit on ordinary activities                                                (839)      (1,646)


(Loss)/profit on ordinary                                                                    (35,450)        1,429
   activities after taxation


Equity minority interests                                                                         (7)         (14)


Retained (loss)/profit for year                                                              (35,457)        1,415
transferred (from)/to reserves


(Loss)/earnings per share                                  3
Basic                                                                                        (59.20)p        2.56p

Diluted                                                                                      (59.20)p        2.46p


Adjusted basic on continuing operations before
exceptional items and acquisition  goodwill amortisation
                                                                                             (11.47)p       11.11p




Robotic Technology Systems PLC
Group balance sheet at 31 December 2002


                                                             31 December              31 December
                                               Note              2002                    2001

                                                            #'000         #'000      #'000        #'000
Fixed assets
Intangible assets                                                        21,245                  44,693
Tangible assets                                                          28,522                  29,560
Investments                                                                  35                      35
                                                                         49,802                  74,288
Current assets
Stocks                                                     15,107                   17,203
Debtors                                                    12,036                   16,624
Investments                                                 2,184                    3,059
Cash at bank and in hand                                    3,645                    8,148
                                                           32,972                   45,034


Creditors: amounts falling due within one                (18,473)                 (22,748)
year



Net current assets                                                       14,499                  22,286

Total assets less current liabilities                                    64,301                  96,574



Creditors: amounts falling due after more                               (6,267)                   (631)
than one year



Provisions for liabilities and                                          (1,357)                    (53)
charges
Net assets                                                               56,677                  95,890

Capital and reserves
Called up share capital                                                     611                     577
Share premium account                           4                        74,490                  74,424
Shares to be issued                             4                           120                   3,640
Merger reserve                                  4                             -                   9,834
Other reserve                                   4                           571                     382
Profit and loss account                         4                      (19,155)                   7,000

Equity shareholders' funds                                               56,637                  95,857
Equity minority interests                                                    40                      33
                                                                         56,677                  95,890



Robotic Technology Systems PLC
Group cash flow statement for the year ended 31 December 2002


                                                                  Year ended        Year ended
                                                                  31 December       31 December
                                                                     2002              2001
                                                                          #'000               #'000
                                                        Note
Net cash (outflow)/inflow from operating activities        5            (6,023)               2,001


Returns on investments and servicing of finance                           (232)                 364

Corporation tax paid                                                      (880)             (1,405)

Capital expenditure and financial investment                            (5,752)             (4,603)


Acquisitions and disposals                                              (1,142)             (1,263)

Cash outflow before management of  liquid resources and                (14,029)             (4,906)
financing


Management of liquid resources                                            3,100               5,808


Financing                                                                 9,496                  87


(Decrease)/increase in cash                                             (1,433)                 989



Reconciliation of net cash flow to movement in net (debt)/funds


                                                                  Year ended        Year ended
                                                                  31 December       31 December
                                                                     2002              2001
                                                                          #'000               #'000

(Decrease)/increase in cash in the year                                 (1,433)                 989
Cash inflow from increase in debt                                       (9,426)                 (5)
Cash inflow relating to liquid resources                                (3,100)             (5,808)

Change in net funds resulting from cash flows                          (13,959)             (4,824)
Debt disposed of with subsidiary undertaking                                  -                 954
Finance leases acquired with subsidiary undertaking                           -                (42)
Movements in net funds in the year                                     (13,959)             (3,912)
Net funds at 1 January                                                    8,069              11,981
Net (debt)/funds at 31 December                                         (5,890)               8,069




1.     Basis of preparation


The financial information set out above does not constitute the Company's
statutory accounts for the year ended 31 December 2002 or for the year ended 31
December 2001.  The financial information for 2001 is derived from the statutory
accounts for the year ended 31 December 2001 which have been delivered to the
registrar of companies.  The auditors have reported on the 2001 accounts; their
report was unqualified and did not contain a statement under section 237(2) or
(3) of the Companies Act 1985. The statutory accounts for 2002 will be delivered
to the registrar of companies following the Company's Annual General Meeting.



2     Turnover and profits


      Turnover analysis

                                                                   Year ended 31 December 2002
                                                               Continuing       Discontinued       Total
                                                                operations        operations
By activity                                                        #'000            #'000           #'000

Assembly Systems                                                    19,143                -        19,143
Build-to-Print                                                       3,213                -         3,213
Flexible Systems                                                       983            3,401         4,384
Life Science                                                        15,352              265        15,617
Nuclear Solutions                                                   12,755                -        12,755
Process Technology                                                   6,869                -         6,869
Support Services                                                     1,696                -         1,696
Tooling Systems                                                      6,882                -         6,882
                                                                    66,893            3,666        70,559

                                                                  Year ended 31 December 2001
                                                                Continuing       Discontinued     Total
                                                                operations         operations
By activity                                                         #'000            #'000         #'000

Assembly Systems                                                    54,371                -     54,371
Build-to-Print                                                      17,982                -     17,982
Flexible Systems                                                       621            7,167      7,788
Life Science                                                        13,577              771     14,348
Nuclear Solutions                                                   16,411                -     16,411
Process Technology                                                  10,408                -     10,408
Support Services                                                     2,288                -      2,288
Tooling Systems                                                      7,749                -      7,749
                                                                   123,407            7,938    131,345



                                                                            Year ended
                                                                           31 December
                                                                       2002            2001
By geographical destination                                           #'000             #'000
United Kingdom                                                       19,389            16,868
Other European Countries                                              5,594             6,239
United States of America                                             42,054            84,739
Rest of World                                                         3,522            23,499
                                                                     70,559           131,345



3      Loss)/earnings per share



(Loss)/earnings per ordinary share have been calculated using the weighted
average number of shares in issue during the relevant financial years.  For
basic (loss)/earnings for share, the weighted average number of equity shares in
issue is 59,892,138 (2001 - 55,395,764) and the (loss)/earnings, being (loss)/
profits after tax and minority interests are (#35,457,000) (2001 - #1,415,000).


                                                                       2002                     2001
                                                                       pence                   pence

Basic (loss)/earnings per share                                      (59.20)                    2.56


The number of shares used for the diluted (loss)/earnings per share is
calculated as follows:

                                                                        2002                    2001
                                                                      Number                  Number

Basic number of shares                                            59,884,638              55,395,764
Exercise of options                                                   80,628               1,176,075
Deferred consideration in respect of                                       -                 933,478

the acquisition of Wright Industries, Inc.
                                                                  59,965,266              57,505,317



The adjustment to the basic number of shares in respect of the exercise of
options has been calculated based on the assumption of a share price of #0.78,
the average in the year.



The (loss)/earnings figures have not been adjusted, being (#35,457,000) (2000 -
#1,415,000) for the purposes of the diluted (loss)/earnings per share
calculation.


                                                                        2002                    2001
                                                                       Pence                   pence

Diluted (loss)/earnings per share                                    (59.20)                    2.46

Adjusted basic (loss)/earnings per share                             (11.47)                   11.11




Adjusted basic (loss)/earnings per share has been calculated to reflect the
underlying trading performance of the Group as follows:


                                                                Year ended 31               Year ended 31
                                                               December 2002                 December 2001
                                                                    #'000                     #'000

(Loss)/profit for the year                                          (35,457)                   1,415
Acquisition goodwill impairment                                       16,400                       -
Acquisition goodwill amortisation                                      2,096                   2,654
Loss on current asset investments                                          -                   2,075
Exceptional administrative expenses                                    1,772                       -
Operating loss on discontinued activities                              8,317                     218
Adjusted basic (loss)/earnings                                       (6,872)                   6,362





4       Reserves


                                Profit and          Share       Shares to    Other        Merger
                                   loss            premium      be issued    reserve      reserve       Total
                                 account           account      #'000        #'000        #'000         #'000
                                  #'000             #'000                                               

Group
At 1 January 2002                    7,000          4,424        3,640          382         9,834        95,280
Loss for the year                 (35,457)              -            -            -             -      (35,457)
Shares issued in the year                -             66            -            -             -            66
UITF 17 share scheme charge              -              -            -          289             -           289
Share schemes options exercised        100              -            -         (100)             -            -
Deferred consideration                   -              -       (1,683)           -         3,396         1,713

Exchange differences               (4,028)              -            -            -             -       (4,028)
Share options waived                     -              -        (181)            -             -         (181)
Deferred consideration not               -              -      (1,656)            -             -       (1,656)
payable                                                 
Impairment of goodwill              13,230              -            -            -      (13,230)             -
                                                         
At 31 December 2002               (19,155)         74,490          120          571             -        56,026




5        Reconciliation of operating (loss)/profit to net cash (outflow)/inflow
from operating activities

                                                                           Year          Year
                                                                          ended 31      ended 31
                                                                         December      December
                                                                            2002          2001
                                                                           #'000         #'000

Operating (loss)/profit                                                  (34,396)         2,651
Depreciation and amortisation                                              25,321         5,095
Restructuring provision                                                     1,327             -
Provision against current asset investments and related receivables            17         2,075
(Gain)/loss on disposal of subsidiaries                                      (22)            26
Decrease/(increase) in stocks                                               1,024       (7,906)
Loss on disposal of intangible fixed assets                                     7             -
Loss on disposal of tangible fixed assets                                      80            26
Profit on disposal of current asset investments                              (84)         (199)
Decrease in debtors                                                         2,826        11,956
Decrease in creditors                                                     (2,413)      (11,174)
Provisions in respect of share scheme                                         290         (549)

Net cash (outflow)/inflow from operating activities                       (6,023)         2,001



                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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