UNDERLYING PERFORMANCE IMPROVES; NEW BUSINESS PIPELINE REMAINS STRONG

Umeco plc, Europe's leading provider of value-added distribution services to the aerospace and defence industries, announces its interim results for the six months ended 30 September 2003.

Turnover increased to £91.8 million (H1 2002: £88.0 million), despite challenges in core aerospace markets;

Profit before tax* of £4.4 million (H1 2002: £4.7 million), impacted by adverse US$ exchange rates;

Excluding foreign exchange movements these profits would have been £4.6 million (H1 2002: £4.4 million);

Earnings per share* of 12.0 pence (H1 2002: 12.9 pence);

Unchanged interim dividend of 4.0 pence per share (H1 2002: 4.0 pence);

Value of long term contract with Rolls-Royce plc continues to grow;

Important new chemicals contract with Lufthansa Technik became operational on 1 November;

New business pipeline remains strong, with high levels of interest being shown in outsourcing services.

Clive Snowdon, Chief Executive of Umeco plc, said:

"Umeco continues to perform very creditably despite the challenges facing our aerospace markets. Demand for our products was adversely affected in the first two months by the SARS outbreak and these results were also hit by the weaker US dollar and by BAE SYSTEMS' decision to suspend work on the Nimrod upgrade programme.

"Despite these factors, our turnover increased, as did our pre-tax profit at constant exchange rates. We continue to enjoy a high rate of business development activity and, looking ahead, there are indications that the long awaited recovery in the aerospace market is now in its early stages. With our sophisticated infrastructure, growing international presence and strong financial base we would expect a quick return to profitable growth as the global market improves."

(* before goodwill amortisation and exceptional items)