Trading Statement

TRADING STATEMENT                               

SUMMARY

The Board is pleased to report that trading for the year to date has been in
line with management expectations.

GROUP

At the time of the interim results we reported that first half sales were 1.5%
higher than in the same period last year and operating profit was ₤22.4m
compared to ₤15.8m in the first half of 2003.

Overall group sales have increased year to date by 1.4% despite the continuing
negative impact of the weakening of the dollar and the disposal of
electroplating businesses. Sales in local currency, excluding electroplating,
are ahead by 7.7%. Energy price increases have begun to come through in some
parts of the Group, however, there will be a negligible impact on 2004 results
both due to timing and to cost recovery actions taken. We anticipate that an
increasing proportion of the Group will be affected in 2005 but remain
confident that a significant share of these increased energy costs will be
passed on.

The execution of our strategy to restructure our Metallurgical Coatings SBU is
on plan. We have sold or closed the major loss making facilities and the
remaining electroplating operations are expected to be sold or closed by the
end of the year.

Cash generation continues to be ahead of last year as a result of tight control
of capital expenditure, asset disposals, the formation of the IonBond joint
venture (announced today) and the ongoing focus on working capital management.

STRATEGIC BUSINESS UNIT (SBU) REVIEW

Heat Treating sales in local currency are cumulatively running more than 5%
ahead of last year and operating profit is up 16%. Turnover has increased in
all geographies except France, which has been steady compared to 2003. The USA
and France remain the biggest challenges in rebuilding margins.

Materials Testing continues to be the best performing SBU with sales, at
constant exchange rates, 10% up on last year and operating margins slightly
ahead. We are focused on growing this business both organically and by
acquisition.

Hot Isostatic Pressing is maintaining its improved performance as a result of
increased demand for industrial gas turbine production in North America, with
local currency sales more than 20% higher year to date compared to 2003 and
with a consequential improvement in margins. Although we are now seeing an
improved demand for aerospace components, we do not expect a further increase
in IGT sales, so HIP turnover in 2005 is expected to be modestly higher than in
2004.

Metallurgical Coatings is now focused on thermal based processes and anodising
and is generating acceptable results.

Bodycote intends to announce its 2004 preliminary results on 1 March 2005.

For further information, please contact:

Bodycote International plc Tel No: 01625 505300

John D. Hubbard, Chief Executive

David Landless, Group Finance Director

Financial Dynamics Tel No: 020 7831 3113

Jon Simmons

Sally Lewis