RNS Number:2285O
Henlys Group PLC
01 August 2003


Date:              1 August 2003



Contacts:               Allan Welsh               Chief Executive
                        Brian Chivers             Finance Director
                        Telephone:                 020 8953 9953


                        TRADING UPDATE AND BOARD CHANGES


Henlys Group's US subsidiary, Blue Bird Corporation, is now entering the period
of peak seasonal demand for school buses.  While the delivery and quality
performance of its North Georgia plant is improving steadily, a business review
undertaken with the new Blue Bird management team has concluded that the plant
will not fully achieve the planned higher production rates in the short-term.
Consequently a number of school buses intended for completion in 2003 fiscal
year will now be delivered after the 30 September period end.



As a result of this changed school bus delivery phasing, together with some
minor delays in the receipt of orders for the new commercial bus and motorhome
products, Group profit before tax, goodwill amortisation and exceptional costs
for the year to 30 September 2003 is now expected to be around #2 million.  The
exceptional charge relating to North Georgia will be approximately #13 million,
the #3 million increase since the Interim Statement being additional costs
incurred to maintain the required product quality while operating at higher
output rates.



The Blue Bird operational management has been strengthened substantially in the
last few months, culminating in the recently announced appointment of a new
President and CEO in July.  This gives the Group confidence that the earnings
recovery forecast for 2004 onwards is still valid.  In particular, as previously
stated the supply problems in North Georgia should be resolved early in the new
fiscal year, and with the greater manufacturing expertise now in place plans are
already being developed to reconfigure the school bus production process during
the lower demand winter period to prevent any recurrence of the 2003 problems.



The other Blue Bird production sites (in Fort Valley, Georgia and Brantford,
Canada) are providing good quality and customer service in both school buses and
other vehicles, and the newly-launched commercial bus, coach and motorhome
ranges have received excellent customer reaction in their early production
phase.



The process to establish longer-term financing for the Group, as previously
reported, is continuing.



Finally, there are two Board changes to announce.  After twenty years' service
with the Group Mr B A C Chivers, Finance Director, will be taking early
retirement as soon as a suitable replacement is established in the Company,
which is expected to be before the end of this calendar year.  We are very
pleased that Mr M S Ost, who became Interim Non-Executive Chairman in May this
year, has now agreed to take the role of Non-Executive Chairman on a permanent
basis.





T Allan Welsh
Chief Executive



1 August 2003




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