RNS Number:9106P
Heiton Group PLC
18 September 2003

Chairman's Statement



Ladies and gentlemen I am delighted to welcome you all to the AGM for the Heiton
Group.



If you will allow me, I would first like to take an opportunity to talk to you
about your Board of Directors.



Firstly, John Bourke who has been a director of the company for 29 years with
eleven of them being chairman of the Audit Committee retires immediately
following this AGM.  I would like to pay my own tribute to John.  Throughout
this time he has brought a special contribution of original thought, financial
expertise, good humour and integrity to your Board's deliberations.  In
particular, as chairman of the Audit Committee his responsibilities have become
progressively more onerous and he has always discharged them with complete
commitment and professionalism.  We, the directors and shareholders of the
Group, owe him a great debt of thanks and wish him all the best in the future.



I would like to welcome both Eddie Kelly and Sir John Gains, both of whom have
been appointed to the Board during the past year, to their first AGM as
directors of your Company.



Eddie Kelly, who joined the Board with effect from the beginning of July has
been with the Group for 29 years and who was previously managing director of
Heiton Buckley Ltd, our builders merchants operation, has assumed the position
of managing director of the newly created Heiton Trade division with effect from
the beginning of July.  With that appointment and its extended area of
responsibility, Eddie has been invited to join the Board of Directors.  We are
delighted to have the benefit of his experience and special knowledge of the
industry around the Board table.



Sir John Gains who was appointed to the Board in November 2002 is the Chief
Executive of Mowlem Plc, one of the largest construction companies in the UK.
Interestingly, his company is currently responsible for building the Port Tunnel
here in Dublin.  Sir John has also been the president of the Construction
Federation, the principal representative body of the UK contracting industry, a
position he relinquished recently.  We are indeed fortunate to have the benefit
of Sir John's knowledge of the UK construction industry as well as the wisdom
and experience he brings as an executive plc director around the Board table.



I am also very pleased to announce that, later today, the Board proposes to
co-opt Mr Willie Cotter to the Board.  Until recently Mr Cotter was Chief
Executive of Bank of Ireland Asset Management, the largest and the most
successful fund management company in the country.  Mr Cotter was instrumental
in the growth of Bank of Ireland Asset Management over 18 years.  He brings to
the Board a unique combination of financial expertise, business development
experience and in-depth familiarity with corporate governance and institutional
investors attitudes.  I am sure you will all agree we are fortunate that Mr
Cotter will be joining us.



I would like to turn now to the performance of the Group in the current
financial year.  In July we announced a re-organisation of the business which
groups the operations under three divisions; Heiton Trade, Heiton Retail and
Heiton UK.



Trading thus far has been very positive with volumes in Ireland comfortably
ahead of last year. Earnings are also well ahead of last year, but it should be
borne in mind that a combination of both unseasonal weather and world cup
activities adversely affected the first quarter of 2002/03.  In Ireland, the
housing and repairs maintenance and improvements markets have been performing
exceptionally well.  Although we do believe that the RMI market will continue to
be strong in the coming months, it is likely that housing growth rates will
modify somewhat in the coming months.  In the UK, the restructuring programme
which was announced in July is on track for completion by th end of the current
financial year.  The drylining business has been closed, the new, fully stocked
Midlands depot is now fully operational and plans for other closures and sales
are progressing.  Overall we are confident for the outlook for the year as a
whole.



Turning to property, shareholders will be pleased to know that a site in Santry,
which was surplus to our trading requirements, has recently been disposed of
generating a profit of Euro2m from cash proceeds of Euro3.6m and a sale and lease back
has been completed for our new facility in Ballyshannon.  These developments
continue a programme of property realisations designed to generate cash and
improve return on capital employed.



In recent years, some shareholders have commented on the amount of our audit fee
and our value for money extracted from that fee.  You will be pleased to know
that we have carried out a tender process during the course of the last twelve
months, inviting a number of firms to make proposals.  The conclusion of that
process has been that PriceWaterhouseCoopers have been retained and that your
Board has confirmed to its satisfaction that our audit fee continues to
represent good value for money.



In summary, ladies and gentlemen, the first four months reflect a promising
start to the year and we are confident that we will continue to make progress in
the months to come.





Richard Keatinge

Chairman



18th September 2003


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