RNS Number:4254S
Abbeycrest PLC
25 November 2003





For Immediate Release                   7.00am              25 November, 2003


            Interim Results for the six months ended 31 August 2003

Restoration of Interim dividend; improved working capital controls; reduction in
                   borrowings; Senior management appointment;


Abbeycrest Plc, the UK's leading jewellery manufacturing and distribution
business announces interim results for the six months ended 31 August 2003.




In his statement to shareholders, Mr Michael Lever, Chairman said:

"Overall trading for the Group has been at similar levels to those for the
comparative period last year. However, the control over working capital together
with the parallel progress towards full year profitability, give the directors
confidence to recommence the payment of an interim dividend."


Key points from the interim statement and results:

   *Turnover of #39.4m (2002: #39.0m)
   *Operating loss of #0.3m (2002: #2.6m loss)
   *Pretax loss of #1.2m (2002: #3.7m loss)
   *Basic loss per share of 4.9p (2002: 11.1p loss)
   *Interim dividend of 1.0p declared (2002: Nil)
   *Borrowings significantly reduced; stocks #3.4m lower than 2002 half year
   *Business review of G&A ongoing under new G&A MD, Andrew Clark
   *Reorganisation of Essex (Thailand) continuing with consolidation
    of manufacturing into one base and opening of sales office and agent in US
   *Brown & Newirth continuing to perform excellently
   *Phil Walker, currently FD, to become Group Chief Executive, March 2004
   *Return to profitability expected at year-end


On current trading and prospects, Mr Lever added:

"Market conditions and resultant sales have been very variable. In the absence
of a marked improvement over the latter part of the year, it is likely that the
results for the full year will fall below expectations. Whilst disappointing,
the Group will return to profit this year and will show significant debt
reduction at the year end."



Enquiries:

Phil Walker, Finance Director, Abbeycrest Plc        Tel:         020 7786 9600 (today only)
Abbeycrest Plc                                       Thereafter   0113 284 5702

Paul Vann/Victoria Stephens, Binns & Co PR Limited   Tel:         020 7786 9600




Chairman's Interim Statement


Overall trading for the Group has been at similar levels to those for the
comparative period last year. As noted in the AGM statement, the Group's
accounting approach to recognising stock returns and related write-downs has
been much more aggressive than previously with these adjustments being made
immediately that we are aware of a potential obsolescence issue. This approach
more accurately reflects the reality of our seasonal trading profile.


Most pleasing has been the control over working capital, particularly at G&A
Ltd, resulting in stocks being #3.4million lower at the half-year than the prior
year comparative with a commensurate reduction in borrowings.


Results


Turnover for the period was #39.4m compared to #39.0m in the same period last
year. An operating loss of #0.3m was sustained (2002: #2.6m loss) resulting in a
loss before tax of #1.2m (2002: #3.7m). Basic loss per share is 4.9p (2002:
11.1p loss).


Dividends


The re-establishment of excellent working capital controls, together with the
parallel progress towards full-year profitability, give the Directors confidence
to recommence the payment of an interim dividend. The Board recommends an
interim dividend of 1p per share (2002: nil).


Review of activities and current trading

G&A Ltd: (Main UK distribution business)

The arrival of Andrew Clark as Managing Director of G&A in July, has brought
strong leadership to the G&A Board and enabled a fundamental business review to
be undertaken. Although not yet complete, it is clear that opportunities exist
to exit unprofitable areas of the business and concentrate resources on
profitable growth opportunities. A further important output from the review will
be an opportunity to reduce the very high operational gearing of G&A, thus
returning the business to profitability and making it much less susceptible to
downturns in the market.


The UK jewellery market has been quiet over this half-year. This has been
evidenced by a decline of 14% in 9ct gold jewellery submitted to the UK Assay
Offices for the second quarter of 2003. Against this background, G&A's trading
in the late summer has been variable, with clear evidence of customers
maintaining very low inventories and delaying purchases due to prevailing high
gold prices.


Disposal of the excess stocks identified twelve months ago, has continued well,
with the emphasis being on addressing the more difficult stock to dispose of.
Due to this policy, scrapping in the first half of this financial year has
equalled the total for the whole financial year 2002/03. Having addressed this
"difficult" stock, our exposure to obsolete stock is significantly reduced from
last year's level, whilst a prudent level of provisioning has been maintained.



DCL Ltd. (Hong Kong)

The start of the year for Hong Kong based DCL was compromised by the SARS
outbreak in the Far East, resulting in the company being unable to attend
overseas shows. Sales to third parties have subsequently recovered, but
inter-group sales to G & A clearly reflect the patterns noted above.


Essex (Thailand)

The reorganisation of Essex has continued apace. Production in the Chiang Mai
factory ceased in August and was moved to spare capacity within the Abbeycrest
Thailand facility in Lamphun, thus making effective use of this space. Only one
day's production was lost in this transfer, a real credit to the Essex
management. Before the year-end, production at the Bangkok factory will also
move to Lamphun, giving the Group a single Thai manufacturing base rather than
three. This will also allow the freehold in Bangkok to be disposed of, thus
releasing cash.


A sales office and agent has been established in New York, which will
re-establish contact between Essex and its historically strong markets in the
USA. Customer introductions will take place over the second half of the year.


Abbeycrest Thailand Ltd

Assembly of gold jewellery has taken place at the new facility in Lamphun
throughout the first half of the year. The establishment of the operation has
gone well, with excellent production levels being achieved by the new workforce.
Despite initial set-up expenses, the company has made a significant financial
contribution to the half year.


Brown & Newirth Ltd (B & N)

Continued design and production innovation has ensured that B&N has been able to
match last year's excellent first half performance, despite the very difficult
market conditions.


Prospects


As noted above, market conditions and resultant sales have been very variable
with a particularly disappointing September. In the absence of a marked
improvement over the latter part of the year, it is likely that the results for
the full year will fall below expectations. Whilst disappointing, the Group will
return to profit this year and will show significant debt reduction at the
year-end. G&A has undergone a traumatic period over the last three years and has
been operating in unprofitable markets. The management of the business are in
the process of concluding a fundamental review of how G&A will best position
itself strategically to go forward and by the time of the full year
announcement, I will be in a position to outline the new shape of G&A and the
trading directions it will pursue.


Board Change


Following the appointment of Andrew Clark as Managing Director of G&A Limited
and George Marcall as a new Group Non-Executive, I am pleased to announce that I
intend to split the roles of Chairman and Chief Executive. Phil Walker, the
current Finance Director, will be taking over as Group Chief Executive with
effect from lst March 2004.



Michael Lever

Chairman

25 November 2003




Consolidated Profit and Loss Account
For the six months ended 31 August 2003



                                   Six months to   Six months to        Year to
                                      31 August        31 August    28 February
                                           2003             2002           2003
                                      Unaudited        Unaudited        Audited
                                          #'000            #'000          #'000

Turnover       - Existing                39,429           39,026         99,099
               operations

               - Less share of              (79)             (91)          (259)
               joint venture            ---------        ---------       --------

               - Continuing              39,350           38,935         98,840
               operations
               
               _________________________________________________________________
Operating      - Before goodwill           (171)          (2,462)         1,956
(loss)/        amortisation
profit
               - Goodwill                  (156)            (116)          (233)
               amortisation            
               _________________________________________________________________


               - Continuing                (327)          (2,578)         1,723
               operations

Share of operating loss in joint            (14)              (4)            (6)
venture

Interest                                    153               68            241
receivable

Interest payable and similar             (1,006)          (1,156)        (2,521)
charges

Interest payable by joint                     -               (1)             -
venture                                 ---------        ---------       --------
                                                                         

Loss on ordinary activities              (1,194)          (3,671)          (563)
before taxation

Tax on loss on ordinary                     262            1,103            132
activities                              ---------        ---------       --------
                                                                         

Loss on ordinary activities after          (932)          (2,568)          (431)
taxation

Minority equity interests                  (247)            (137)          (568)
                                        ---------        ---------       --------
                                                                        

Loss for the financial period            (1,179)          (2,705)          (999)

Dividends paid and proposed on             (249)               -           (249)
equity shares                           ---------        ---------       --------
                                                                         

Retained loss for the period             (1,428)          (2,705)        (1,248)
                                        ---------        ---------       --------
                                                                        

Loss per share - basic                     (4.9)p          (11.1)p         (4.1)p
              - diluted                    (4.9)p          (11.1)p         (4.1)p

Dividends per                                 1p               -              1p
share







Consolidated Statement of Total Recognised Gains and Losses





Loss for the financial period                (1,179)       (2,705)       (999)

Profit/(loss) on foreign currency               187          (415)       (559)
translation                                    ------     ---------   ---------


Total recognised gains and losses relating     (992)       (3,120)     (1,558)
to the period                                  ------     ---------   ---------




The accompanying notes are an integral part of this Consolidated Profit and
Loss Account and the Consolidated Statement of Total Recognised Gains and
Losses.







Consolidated Balance Sheet
At 31 August 2003



                                31 August 2003   31 August 2002      28 February
                                                                          2003
                                    Unaudited        Unaudited         Audited
                                        #'000            #'000           #'000
Fixed assets

Goodwill                                2,412            2,747           2,579
Negative goodwill                        (395)            (453)           (407)
                                      ---------        ---------      ----------
                                        2,017            2,294           2,172


Tangible fixed                          9,897           10,360          10,663
assets
Investments                               540              540             540
                                      ---------        ---------      ----------
                                       12,454           13,194          13,375


Investment in joint venture:

Share of gross                            185              180             166
assets
Share of gross liabilities               (158)            (142)           (125)
                                      ---------        ---------      ----------
                                                                      ----------
                                       12,481           13,232          13,416
                                      ---------        ---------      ----------

Current assets

Stocks                                 35,219           38,664          32,200
Debtors                                20,912           22,967          17,706
Cash at bank and in hand                5,972            2,149           7,917
                                      ---------        ---------      ----------

                                       62,103           63,780          57,823

Creditors
                                      
Amounts falling due within            (43,075)          43,220          37,917
one year
                                      ---------        ---------      ----------

Net current assets                     19,028           20,560          19,906


Total assets less current              31,509           33,792          33,322
liabilities


Creditors

Amounts falling due after more          4,253            6,748           4,909
than one year
Provisions for liabilities and             91              447             123
charges                               ---------        ---------      ----------
                                                                      

Net assets                             27,165           26,597          28,290
                                      ---------        ---------      ----------


Capital and
reserves

Called up share                         2,488            2,488           2,488
capital

Shares to be issued                       580              580             580

Share premium                           5,186            5,186           5,186
account

Merger reserve                            199              199             199

Profit and loss                        17,620           17,548          18,861
account                               ---------        ---------      ----------


Equity shareholders' funds             26,073           26,001          27,314

Minority equity                         1,092              596             976
interests                             ---------        ---------      ----------


Total capital                          27,165           26,597          28,290
employed                              ---------        ---------      ----------



The accompanying notes are an integral part of this Consolidated Balance Sheet.



Consolidated Cash Flow Statement
For the six months ended 31 August 2003





                                    Six months to    Six months to     Year to
                                        31 August        31 August   28 February
                                                                          2003
                                             2003             2002     Audited
                           Notes        Unaudited        Unaudited
                                            #'000            #'000       #'000

Net cash (outflow)/inflow      1           (5,935)         (12,014)      6,126
from operating
activities

Returns on investments         2             (773)          (1,016)     (2,468)
and servicing of
finance

Taxation                                      (47)             (46)       (456)

Capital expenditure and        2             (156)          (1,367)     (2,809)
financial investment

Equity dividends paid                        (247)          (1,144)     (1,045)
                                        -----------       ----------    --------

Cash outflow before                        (7,158)         (15,587)       (652)
financing

Financing                      2             (666)           6,498       2,437
                                        -----------       ----------    --------

(Decrease)/increase in         3           (7,824)          (9,089)     (1,785)
cash in the period                      -----------       ----------    --------


The accompanying notes are an integral part of this Consolidated Cash Flow
Statement.





Notes to the Interim Financial Information

For the six months ended 31 August 2003



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

                                     Six months to    Six months to        Year to
                                         31 August        31 August    28 February
                                              2003             2002           2003
                                             #'000            #'000          #'000

Operating (loss)/profit                       (327)          (2,578)         1,723

Depreciation                                   897              973          1,961

Amortisation of goodwill                       155              116            233

Loss on sale of tangible fixed                  55                8             53
assets

Foreign exchange movement                        -               (5)             -

(Increase)/decrease in stocks               (2,981)          (2,488)         4,077

(Increase)/decrease in debtors              (2,402)          (2,052)         1,937

Decrease in creditors                       (1,332)          (5,988)        (3,858)


                                           ---------        ---------       --------
Net cash (outflow)/inflow from              (5,935)         (12,014)         6,126
operating activities                       ---------        ---------       --------






2. Analysis of cash flows



Returns on investments and
servicing of finance

Interest received                        153               68                  241

Interest paid                           (795)          (1,082)              (2,556)

Interest element of finance lease          -               (2)                  (2)
rental payments

Dividend paid to minority               (131)               -                 (151)
interest                             ---------        ---------             --------

Net cash outflow from returns on        (773)          (1,016)              (2,468)
investments and servicing of         ---------        ---------             --------
finance  


Capital expenditure and financial
investment

Purchase of tangible fixed assets       (700)          (1,480)              (3,080)

Sale of tangible fixed assets            544              113                  271
                                     ---------        ---------             --------
Net cash outflow from capital           (156)          (1,367)              (2,809)
expenditure and financial            ---------        ---------             --------
investment


Financing

Issue of ordinary share capital            -               10                   10

New secured loan                           -            6,500                6,500

Repayment of secured loan               (650)               -                 (650)

Repayment of loan notes                    -                -               (3,399)

Capital element of finance lease         (16)             (12)                 (24)
rental payments                      ---------        ---------             --------

Net cash (outflow)/inflow from          (666)           6,498                2,437
financing                            ---------        ---------             --------




Notes to the Interim Financial Information
(continued)




3. Analysis of net debt


                                     1 March                        31 August
                                        2003       Cashflow              2003
                                       #'000          #'000             #'000

Cash at bank and in                    7,917         (1,945)            5,972
hand
Overdrafts                           (26,252)        (5,879)          (32,131)
                                  ------------      ---------        ----------
                                     (18,335)        (7,824)          (26,159)

Debt due within one                   (1,300)             -            (1,300)
year

Debt due after one                    (4,550)           650            (3,900)
year

Finance leases                           (58)            16               (42)
                                  ------------      ---------        ----------

                                      (5,908)           666            (5,242)
                                  ------------      ---------        ----------

Net debt

                                     (24,243)        (7,158)          (31,401)
                                  ------------      ---------        ----------


4. Reconciliation of net cash flow to movement in net debt


                                                                Six months to
                                                                    31 August
                                                                         2003
                                                                        #'000

Decrease in cash in the period                                         (7,824)

Cash inflow from decrease in debt and                                     666
lease financing                                                      ----------

                                                                       (7,158)

Net debt at beginning of period                                       (24,243)
                                                                     ----------

Net debt at end of period                                             (31,401)
                                                                     ----------


Notes to the Interim Financial Information
For the six months ended 31 August 2003 (continued)



5.  Basis of accounts

The accounting policies used in the interim accounts for the six months
ended 31 August 2003 are consistent with those applied in the accounts in
respect of the financial period ended 28 February 2003.


Accounts in respect of the financial period ended 28 February 2003 do not
constitute  the Company's statutory accounts for that period, but are an
abridged version of the Group's full accounts within the meaning of Section 251
of the Companies Act 1985.  Full accounts have been reported on without
qualification by the auditors and have  been filed with the Regstrar of
Companies.

The accounts for the six months ended 31 August 2003 have not been audited,nor
have  the accounts for the equivalent period in 2002.

Copies of the announcement will be sent to shareholders and are available to
members  of the general public from the Company Secretary, Abbeycrest Plc, Peter
Rosenberg House,  11-15 Wilmington Grove, Leeds, LS7 2BQ.

6.   Dividends


An Interim dividend of 1p per share will be paid on 9 January 2004 to shareholders 
on the register at the close of business on 12 December 2003.


7.   Earnings per share


Earnings per share have been calculated using the weighted average number of shares 
in issue during the period of 24,276,241 (2002:24,261,005).



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

END
IR EASFLADFDFFE