Major Extension to Rolls-Royce PLC Contract

Umeco plc, ("Umeco"), Europe's leading provider of value-added distribution services to the aerospace and defence industries, today announces its preliminary results for the year to 31 March 2002.

Group remained profitable and highly cash generative, despite impact of 11 September on civil aerospace sector volumes;

Turnover up 16% to £191.0 million (2001: £165.0 million), reflecting contribution from US acquisitions;

Pre-tax profit before exceptional items and goodwill amortisation 9% lower at £10.1 million (2001: £11.1 million);

Proposed final dividend of 8.75 pence per share (2001: 8.75 pence), making unchanged total dividend for the year of 12.0 pence per share;

Prompt action taken post 11 September to reduce cost base and working capital levels;

Abscoa (acquired June 2001) trading well, and delivering anticipated strategic benefits of US presence;

Recent contract wins, including with ITP and Goodrich, provide clear evidence that trend towards outsourcing is accelerating;

Major extension to existing relationship with Rolls-Royce plc agreed.


Clive Snowdon, Umeco's Chief Executive said:

"Despite the inevitable impact of the events of 11 September and their aftermath on our core aerospace market, we have good reason to be confident and positive about our future prospects.

"Last year's performance has underlined the Group's resilient and cash generative qualities; the strategic rationale behind our recent US acquisitions is being fully justified by their performance; and recent contract wins provide evidence that outsourcing in our core markets is on the increase, driven in part by the additional pressures on our customer base to maximise efficiencies in the wake of the September terrorist attacks.

"Today's announcement of a major extension of our relationship with Rolls-Royce plc is highly significant to UMECO both in financial terms, and in the message it sends to the market about our ability to deliver on large scale contracts for the most sophisticated OEM customers.

"Alongside this positive progress, we have continued to invest in our businesses and to strengthen our management teams. We therefore believe that UMECO is exceptionally well placed for when the civil aerospace market recovers to its former levels."