Annual Financial Report

24 February 2014

                               XP Power Limited

                         ("XP Power" or "the Group")

              Annual Results for the year ended 31 December 2013

XP Power, one of the world's leading developers and manufacturers of critical 
power control components for the electronics industry, today announces its annual 
results for the year ended 31 December 2013.

Highlights
                                     Year ended      Year ended
                                    31 December     31 December       Change
                                           2013            2012

Order intake                            £103.7m          £96.6m          +7%
Revenue                                 £101.1m          £93.9m          +8%
Gross margin                              49.1%           47.8%     +130 bps
Profit before tax                        £22.9m          £20.2m         +13%
Profit after tax                         £18.4m          £15.7m         +17%
Diluted earnings per share adjusted       95.1p           81.3p         +17%
Operating cash flow                      £20.2m          £23.6m         -14%
Net debt                                  £3.5m          £10.6m         -67%
Final dividend per share                  19.0p           17.0p         +12%
Total dividend per share                  55.0p           50.0p         +10%

- The Group's well-established strategy of developing and manufacturing its
own range of market leading products produced another year of strong progress

- Order intake increased by 7% to £103.7 million (2012: £96.6 million) and
revenues increased by 8% to £101.1 million (2012: £93.9 million)

- Gross margins recovered to 49.1% (2012: 47.8%) as the new Vietnam facility
moved into profit from June 2013 and product mix improved

- XP Power's own design revenues increased to a record £64.2 million (2012:
£57.6 million) or 64% of total revenues (2012: 62% of total revenues)

- Sales of high efficiency ("green") products increased by 16% to £9.4
million, representing 9.3% of revenue (2012: £8.1 million or 8.6% of revenue)

- Strong earnings and continued strong cash flows resulted in a reduction in
net debt to £3.5 million from £10.6 million at the end of 2012

- Full year dividend increased 10% to 55.0 pence per share (2012: 50.0 pence
per share), with proposed final dividend of 19.0 pence per share (2012: 17.0
pence per share).

- Successful repositioning as a designer and manufacturer leaves the Group
well positioned to continue to take market share

Larry Tracey, Chairman, commented:

"2013 has been another year of progress where we have again demonstrated the
successful execution of our well-established strategy of moving up the value
chain into design and manufacture. We have delivered a solid set of results
and encouragingly, have again out-paced our competitors and taken market
share."

"XP Power's customers supply capital equipment to numerous markets across the
globe. The macro-economic outlook for these customers has shown gradual
improvement in the second half of 2013, which gives us confidence for further
growth in 2014 and beyond."


Enquiries:

XP Power
Duncan Penny, Chief Executive                              [phone]
Jonathan Rhodes, Finance Director                          [phone]

Citigate Dewe Rogerson                                     [phone]
Kevin Smith/Jos Bieneman


XP Power designs and manufactures power controllers, the essential hardware
component in every piece of electrical equipment that converts power from the
electricity grid into the right form for equipment to function.

XP Power typically designs in power control solutions into the end products of
major blue chip OEMs, with a focus on the industrial (circa 45% of sales),
healthcare (circa 30% sales) and technology (circa 25% of sales) sectors. Once
designed into a program, XP Power has a revenue annuity over the life cycle of
the customer's product which is typically 5 to 7 years depending on the
industry sector.

XP Power has invested in research and development and its own manufacturing
facility in China, to develop a range of tailored products based on its own
intellectual property that provide its customers with significantly improved
functionality and efficiency.

Headquartered in Singapore and listed on the Main Market of the London Stock
Exchange since 2000, XP Power serves a global blue chip customer base from 27
locations in Europe, North America and Asia.

For further information, please visit www.xppower.com Chairman's Statement

Overview

2013 has been another year of progress where we have again demonstrated the
successful execution of our well-established strategy of moving up the value
chain into design and manufacture. We have delivered a solid result and the
evidence is that we have again out-paced our competitors and taken market
share.

Earnings per share for 2013 grew by 17% to 95.1 pence (2012: 81.3 pence),
demonstrating the effectiveness of our business model. This solid growth in
earnings, combined with strong cash generation, allowed us to increase the
dividend once again, while at the same time significantly reducing our net
debt.

The compound average growth rate of earnings per share has been 22% over the
last 5 years and 23% over the last 10 years.

Financial Highlights

Order intake increased by 7% to £103.7 million in the year (2012: £96.6
million). Revenues increased by 8% to £101.1 million (2012: £93.9 million).
Revenues from XP Power's own designed product - a key indicator of our
strategic progress - grew 11% to £64.2 million (2012: £57.6 million)
representing 64% of revenue (2012: 62%) and setting a new record.

As expected, gross margin improved to 49.1% (2012: 47.8%) due to product mix
and the absence of start-up costs incurred in the prior year from our new
Vietnam manufacturing facility. Higher revenues, in combination with improved
gross margins, resulted in a healthy operating profit of £23.3 million (2012:
£21.0 million) or 23.0% of revenue (2012: 22.4%).

Net debt at the year-end was £3.5 million compared to £10.6 million at the end
of 2012. Operating cash flow was £20.2 million (2012: £23.6 million)
representing 86.7% of operating income.

Strategic Progress

XP Power has a long-established strategy of targeting blue chip customers with
strong leadership positions in their respective markets, and whose insistence
on vetting their suppliers' design and manufacturing facilities acts as a
significant barrier to entry to many of the Group's potential competitors. Our
state-of-the-art factories in China and Vietnam are dramatically enhancing the
Group's ability to secure preferred supplier status with these larger
customers and increase the proportion of revenues which come from our higher
margin, own-designed products. This strategy remained successful in 2013 and
we believe that it will continue to underpin the Group's progress in the
current financial year.

Dividend

Our continued strong financial performance, strong cash flows and confidence
in the Group's long term prospects have enabled us to consistently increase
dividends.

In line with our progressive dividend policy, a final dividend of 19 pence per
share for the fourth quarter of 2013 is proposed. This dividend will be
payable to members on the register on 14 March 2014 and will be paid on 10
April 2014.

When combined with the interim dividends for the previous quarters, the final
proposed dividend results in a total dividend of 55 pence per share for the
year (2012: 50 pence); an increase of 10%. The compound average growth rate of
our dividend has been 21% over the last 5 years and 16% over the last 10
years.

Board Changes

On 1 January 2014 the Group announced the appointment of Peter Bucher as a
non-executive director.

Peter is well known within the power converter industry and I am delighted to
welcome him to the Board. He brings a wealth of power experience with him and
he will be extremely valuable to our business.

Outlook

XP Power's customers supply capital equipment to numerous markets across the
globe. The macro-economic outlook for these customers has shown gradual
improvement in the second half of 2013, which gives us confidence for further
growth in 2014 and beyond. If this improvement is sustained we would expect to
grow revenues again in 2014.

Larry Tracey
Chairman



Chief Executive's Review

Overview

2013 was an encouraging year for XP Power. We continued to execute our long
term strategy and evidence suggests we have continued to take market share.
Since the summer of 2013 we have seen evidence of a slow but gradual
improvement in the markets we serve and revenue and earnings growth has
resumed following the poor environment for capital equipment spending that
characterised 2012. If this improvement is sustained we would expect 2014 to
be another year of growth for the Group.

Our new Vietnam manufacturing facility reached levels of production that meant
it started to contribute to our gross margins from June 2013. Increased
revenues of our own designed and manufactured product also contributed to an
improvement in gross margins. These positive influences fully offset the rapid
wage inflation that we have continued to witness in China.

Our strategy and business model once again allowed us to produce class leading
operating income of £23.3 million or 23.0% of operating margin (2012: £21.0 or
22.4%) and excellent free cash flow of £17.7 million (2012: £20.9 million)
which enabled net debt to be reduced from £10.6 million at the beginning of
2013 to £3.5 million at the year-end. This significant reduction was achieved
after returning £10.0 million to shareholders in the form of dividends.

The Group continued to make excellent progress with its strategy of increasing
penetration of its target blue-chip customer accounts. We expect that this
sustained focus on customers with leadership positions in their respective
markets will enable us to take further market share.

Our broad and up-to-date portfolio of class leading products, many of which
are highly efficient, combined with excellent engineering support, and the
assured quality and reliability facilitated by our move into manufacturing, is
increasingly making us the power converter provider of choice for many large
customers.

Our own designed product revenues reached a new record and grew 11% to £64.2
million, representing 64% of our total revenues (2012: 62%). Own designed
products generate higher gross margins, and give us the capability to design
tailor-made power control solutions for our customers.

Key Performance Indicators Aligned With Our Strategy

The Group has defined five key performance indicators which are closely
aligned with its strategy, and which demonstrate the significant progress made
over the last five years.

Key           Strategy points       2009   2010   2011   2012   2013   Target
Performance
Indicator

Number of new - Develop a strong      30     31     38     19     31 Note (1)
product       pipeline of leading
introductions edge products

"Green"       - Expansion of high      -  £2.8m  £5.0m  £8.1m  £9.4m Note (2)
product       efficiency "Green"
revenues      products

Own design    - Target and        £26.2m £44.1m £59.2m £57.6m £64.2m Note (3)
product       increase
revenues      penetration of key
              accounts
              - Increase
              contribution of own
              design products

Proportion of - Manufacture our      39%    48%    57%    62%    63% Note (4)
own design    own products
products

Earnings per  - Target and         40.8p  83.7p 106.4p  81.3p  95.1p Note (5)
share         increase
              penetration of key
              accounts

(1) Number of new product introductions = the number of new product families
launched to our sales team and customers during the year including both own
design and labelled products

The Group does not have an absolute long term target for this metric. Also not
all products are equal in terms of their complexity and potential future
revenue. For instance even though the number of products released in 2012
reduced, the development teams were working on a large program of products
that will release in a later period. In assessing new product opportunities
our development teams consider the potential revenue from a new product family
as well as the total number of product introductions.

(2) "Green" product revenues = revenues generated from products which meet the
high efficiency and low stand-by power requirements set by XP Power to qualify
them to carry the "Green XP Power" logo

The Group does not have an absolute long term target for this metric but we
would expect the growth rate of these products to significantly outpace the
growth rate of total revenues.

(3) Own design revenue = revenue derived from products designed by XP Power or
where XP Power owns the design and outsources manufacture

The Group does not have an absolute long term target for this metric. However,
the Group targets to grow this metric by a double digit percentage each year.

(4) Proportion of own design revenue = revenue from own design products as a
percentage of total revenue

We are targeting to achieve 75% own design revenue over the course of time.

(5) Earnings per share = diluted earnings per share adjusted for amortisation
of intangibles associated with acquisitions and exceptional charges or profits

There is no absolute long term target set for this metric but the Group
targets to grow this metric by a double digit percentage each year. The
compound growth rate for this metric over the last five years has been 22%.

We are pleased to report improvements in all our key performance indicators in 2013.

Markets

XP Power supplies power control solutions to Original Equipment Manufacturers
("OEMs") of capital goods, who themselves supply the healthcare, technology
and industrial sectors with high value products. The increasing importance of
energy efficiency, for both environmental and economic reasons, the necessity
for ever smaller products, the rate of technological change and the increasing
proliferation of electronic equipment, all contribute to underpin the strength
of medium term demand for XP Power's power conversion products.

The worldwide available market for XP Power's products was estimated to be
£1.7 billion per annum in 2013. We estimate XP Power's global market share to
be around 6% in 2013. Across North America and Europe, XP Power currently has
around 8% and 11% respectively of its available market, while across Asia our
share is estimated to be 1%. This illustrates the significant commercial
opportunities that remain open to XP Power, and the Board is confident that
the Group's competitive advantages over many of its peers will allow it to
take further share in each of its key markets.

The sector split of 2013 revenues was as follows: Industrial increased 8% to
£47.5 million (2012: £43.8 million), Healthcare increased 16% to £30.2 million
(2012: £26.0 million) and Technology declined 3% to £23.4 million (2012: £24.1
million).

Our healthcare business continued to perform strongly due to its broad and up
to date product portfolio, combined with the wholly-owned manufacturing
facilities which are essential to give the quality control that healthcare
customers demand. Our value proposition has also enabled greater penetration
of the larger customers in the sector.

We have seen a broad but gradual recovery in the demand from most of our
customers and segments during the second half of 2013; particularly the
industrial sector. We have also made good in-roads into areas such as test and
measurement and 3D printing which we report under industrial. The technology
sector also benefited from a gradual recovery in demand from the
semi-conductor manufacturing equipment makers, which began to take hold in the
second half of the year.

According to geography our 2013 revenues were split: Europe up 7% to £43.8
million (2012: £40.8 million), North America up 10% to £50.0 million (2012:
£45.4 million) and Asia down 5% to £7.3 million (2012: £7.7 million). Asian
revenues in 2012 and 2013 were, as expected, affected by one unusually large
technology sector program reaching the end of its lifespan.

Our major blue chip customers require market leading, highly reliable
products. We maintained a consistent investment in research and development
throughout the year and our product pipeline remains the broadest and freshest
in the industry. The attractions of this continually evolving portfolio of
market leading products enabled the Group to win a number of new programs in
the year, underpinning revenue growth in future years.

International Network

Increasingly, the design and manufacturing process of major international OEMs
takes place across different continents, with these blue chip companies
demanding global support. In response, XP Power has established an
international network of offices which offers the necessary customer support
across technical sales, design engineering, logistics and operations. This
network gives XP Power a strong competitive advantage over both its smaller
competitors, who do not have the scale and geographic reach to serve global
customers, and its larger competitors, who often lack the operational
flexibility to provide excellent service and speed. We believe that this
balance is key to our success in winning new contracts and offers XP Power the
opportunity to further increase its market share.

XP Power's mix of quick response capability and global reach is a major
competitive advantage. XP Power maintains a network of 27 sales offices spread
over North America, Europe and Asia, with a further 16 distributors supporting
its smaller customers, during the year. The size and scope of this network is
kept under continuous review to ensure the business remains best placed to
capitalise on growth opportunities in each of its geographies.

XP Power has the largest, most technically trained sales force in the
industry. Our detailed in-house training programme demands that the sales
force pass numerous technology and customer service modules, making them a
"value add" partner to our customers' product development teams. Management
believes that this gives the business a competitive edge compared to many
within its peer group.

The North American network consists of 17 sales offices and an extensive
engineering services function, based in Northern California. This network
allows XP Power to provide its major customers with local, face to face
support and rapid response times.

In Europe, the XP Power network consists of 8 sales offices and a further 9
distributor offices. In addition, XP Power has engineering services centres in
Germany and the UK.

The Asian sales activities are run from Shanghai and Singapore, where we also
manage a network of seven distributors serving the region. We also added a
direct sales presence in India during the year.

Market Leading Technology

A long term commitment to invest in research and development of new products
has been the cornerstone of XP Power's growth strategy. We consider that we
now have the broadest, most up to date portfolio of products in the industry,
many with class leading efficiency.

Gross research and development spend was £5.3 million in 2013 (2012: £5.3
million), and 31 new product families were introduced in the year. As
previously reported, having established such a broad portfolio, the rate of
new product introductions has slowed with more of our engineering resource now
focused on modifications to existing products to meet the precise requirements
of individual customers. Over half of the products we sell are modified from
the original standard version in some form or another.

Manufacturing Capabilities

Our target customers demand the ultimate in terms of quality control to ensure
the reliability and safety for the life of their equipment. Complete control
of manufacturing is therefore critical to ensure strict management of the
production processes and components that go into our products, and also gives
us opportunities to reduce our product costs. The capability and performance
of our Kunshan facility, which was commissioned in 2009, has been instrumental
in winning new programs and customers.

In 2012 we commenced production at our new magnetics facility in Ho Chi Minh
City, Vietnam. The Vietnam facility gives us the capability to produce our own
magnetic components, which not only enhances our value proposition to our
customers but also provides a second geographical base to mitigate the effect
of rapidly increasing costs in China. Production volumes at the Vietnam
facility increased steadily throughout the year and it has been profitable
since June 2013. The facility is currently providing approximately 60% of our
magnetics demand. We expect to start production of power converters in Vietnam
in the second half of 2014.

The Environment and Sustainability

In 2009 we established an Environmental Committee that immediately set the
goal of making XP Power the leader in environmental issues within our
industry. Much has been achieved since 2009 and our progress will be set out
in detail in the Environmental Report contained within our 2013 Annual Report.

Our new Vietnamese magnetics facility is the most environmentally friendly
power converter manufacturing facility in the world meeting the Gold Plus
rating of the BCA Green Mark requirements; the leading standards set by the
Singapore Building and Construction Authority for non-residential buildings in
tropical climates. We are proud that this is not only the most environmentally
friendly facility in our industry but is the first BCA Green Mark certified
industrial facility in Vietnam.

The biggest impact XP Power can have on the environment is to promote its high
efficiency green products, which consume and waste less energy on an on-going
basis. Revenues from these green products continue to increase. In 2012 we
shipped £8.1 million of green products or 8.6% of revenue, compared with £5.0
million or 4.8% of revenue in 2011. In 2013 we have seen further progress,
shipping £9.4 million or 9.3% of revenue. We have made this metric one of our
key performance indicators. We estimate that the green products we shipped in
2013 will save approximately 84,000 tonnes of CO2 emissions over their
expected lifetime compared with a conventional 80% efficient power converter.
We expect this to be an increasingly important factor for our customer base
when choosing their suppliers.

Outlook

Design wins in 2013 have continued to be positive and we are pleased with the
further headway that has been made in achieving approved or preferred supplier
status at new key accounts. We remain confident in our strategy of targeting
customers with strong leadership positions in their respective markets. These
blue chip customers find the Group's broad, up to date product offering and
in-house manufacturing capabilities extremely attractive, especially as they
are supported with very high service levels. We consider that these
competitive strengths allied to an improving macroeconomic backdrop, place XP
Power in a strong position to capitalise on its medium term growth ambitions.

Duncan Penny
Chief Executive


XP Power Limited
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2013


£ Millions                                              Note    2013     2012
 
Revenue                                                   2    101.1     93.9
Cost of sales                                                 (51.5)   (49.0)
Gross profit                                                    49.6     44.9
 
Expenses
Distribution and marketing                                    (21.2)   (19.1)
Administrative                                                 (0.7)    (0.7)
Research and development                                       (4.4)    (4.1)
Operating profit                                                23.3     21.0
 
Finance cost                                                   (0.4)    (0.8)
Profit before income tax                                  2     22.9     20.2
 
Income tax expense                                        3    (4.5)    (4.5)
 
Profit for the year                                             18.4     15.7
 
Profit attributable to:
Equity holders of the Company                                   18.2     15.5
Non-controlling interests                                        0.2      0.2
Profit for the year                                             18.4     15.7
 
Earnings per share attributable
to owners of the parent
(pence per share)
- Basic                                                   5     95.8     81.7
- Diluted                                                 5     95.1     81.3



XP Power Limited
Consolidated Balance Sheet
As at 31 December 2013

£ Millions                                              Note    2013     2012
 
ASSETS
Current Assets
Cash and cash equivalents                                        5.0      4.1
Inventories                                                     20.4     19.8
Trade receivables                                               15.4     14.2
Other current assets                                             1.4      1.2
Total current assets                                            42.2     39.3
 
Non-current assets
Goodwill                                                        30.6     30.5
Intangible assets                                                8.5      7.6
Property, plant and equipment                                   12.7     13.2
Deferred income tax assets                                       0.5      0.3
ESOP loan to employees                                           1.0      1.2
Total non-current assets                                        53.3     52.8
Total assets                                                    95.5     92.1
 
LIABILITIES
Current liabilities
Current income tax liabilities                                   1.1      1.6
Trade and other payables                                        12.7     11.1
Borrowings                                                6      8.5      7.3
Derivative financial instruments                                 0.1      0.2
Total current liabilities                                       22.4     20.2
 
Non-current liabilities
Provision for deferred contingent consideration           7      1.7      1.5
Borrowings                                                6        -      7.4
Deferred income tax liabilities                                  2.0      1.7
Total non-current liabilities                                    3.7     10.6
Total liabilities                                               26.1     30.8
NET ASSETS                                                      69.4     61.3
 
EQUITY
Equity attributable to owners of the parent
Share capital                                                   27.2     27.2
Treasury shares                                                (1.0)    (1.2)
Merger reserve                                                   0.2      0.2
Hedging reserve                                                (0.3)    (0.2)
Translation reserve                                            (8.0)    (7.7)
Retained earnings                                               51.1     42.8
                                                                69.2     61.1
Non-controlling interests                                        0.2      0.2
TOTAL EQUITY                                                    69.4     61.3



XP Power Limited
Consolidated Statement of Cash Flows
For the year ended 31 December 2013

£ Millions                                                      2013     2012
 
Cash flows from operating activities
Profit for the year                                             18.4     15.7
Adjustments for
- Income tax expense                                             4.5      4.5
- Amortisation and depreciation                                  2.7      2.3
- Finance cost                                                   0.4      0.8
- ESOP expenses                                                  0.1        -
- Gain on fair valuation of derivative financial
instruments                                                    (0.2)    (0.1)
- Unrealised currency translation (gain)/ loss                 (0.4)      0.5
 
Change in the working capital
- Inventories                                                  (0.6)      2.2
- Trade and other receivables                                  (1.4)      3.2
- Trade and other payables                                       1.6    (0.3)
- Provision for liabilities and other charges                    0.1    (0.9)
Income tax paid                                                (5.0)    (4.3)
Net cash generated from operating activities                    20.2     23.6
 
Cash flows from investing activities
Acquisition of a subsidiary, net of cash acquired                  -    (0.1)
Purchases and construction of property, plant and
equipment                                                      (1.0)    (2.5)
Research and development expenditure capitalised               (2.2)    (2.2)
Proceeds from disposal of property, plant and equipment          0.1      0.4
ESOP loans repaid                                                0.2      0.5
Payment of deferred consideration                                  -    (1.9)
Net cash used in investing activities                          (2.9)    (5.8)
 
Cash flows from financing activities
Repayment of borrowings                                        (3.8)    (4.2)
Sale of treasury shares                                          0.1        -
Net purchase of treasury shares by ESOP                            -    (0.5)
Interest paid                                                  (0.3)    (0.5)
Dividend paid to equity holders of the Company                 (9.9)    (8.9)
Dividend paid to non-controlling interests                     (0.2)    (0.2)
Net cash used in financing activities                         (14.1)   (14.3)
 
Net increase in cash and cash equivalents                        3.2      3.5
Cash and cash equivalents at beginning of financial
year                                                             0.5    (3.3)
Effects of currency translation on cash and cash
equivalents                                                      0.1      0.3
 
Cash and cash equivalents at end of financial year               3.8      0.5



Notes to the Annual Results Statement
For the year ended 31 December 2013

1. Basis of preparation

These financial statements are presented in Pounds Sterling and have been
prepared using the accounting principles incorporated within International
Financial Reporting Standards (IFRS) as adopted by the European Union.


2. Segmental reporting

The Group is organised on a geographic basis. The Group's products are a
single class of business; however the Group is also providing sales by end
market to assist the readers of this report.

The geographical segmentation is as follows:

£ Millions                                          2013    2012
 
Revenue
Europe                                              43.8    40.8
North America                                       50.0    45.4
Asia                                                 7.3     7.7
 
Total Revenue                                      101.1    93.9
 
Segment result
Europe                                               7.4     7.4
North America                                       13.3    11.2
Asia                                                 0.9     0.9
Segment result                                      21.6    19.5
 
Research and development costs                     (4.4)   (4.1)
Finance income and cost                            (0.4)   (0.8)
Corporate recovery from operating segment            6.1     5.6
Profit before tax                                   22.9    20.2
Tax                                                (4.5)   (4.5)
Total Profit                                        18.4    15.7


Analysis by end market

The revenue by end market was as follows:

               Year to 31 December 2013     Year to 31 December 2012
 
                      North                        North
£ Millions   Europe America   Asia  Total Europe America   Asia  Total
 
Technology      9.1    11.3    3.0   23.4   10.4     9.9    3.8   24.1
Industrial     25.3    19.0    3.2   47.5   22.1    18.9    2.8   43.8
Healthcare      9.4    19.7    1.1   30.2    8.3    16.6    1.1   26.0
 
Total          43.8    50.0    7.3  101.1   40.8    45.4    7.7   93.9


3. Income taxes

£ Millions                                          2013    2012

Singapore corporation tax
- current year                                       1.2     1.0
- adjustment in respect of prior year                  -       -

Overseas corporation tax
- current year                                       3.4     3.1
- adjustment in respect of prior year              (0.2)     0.6

Total current tax                                    4.4     4.7

Deferred income tax
- current year                                       0.1     0.2
- adjustment in respect of prior year                  -   (0.4)
 
Tax charge for the year                              4.5     4.5


The differences between the total income tax expense shown above and the
amount calculated by applying the standard rate of Singapore corporate tax to
the profit before tax are as follows:

£ Millions                                          2013    2012
 
Profit before tax                                   22.9    20.2
 
Tax on profit at standard Singapore tax rate
of 17%                                               3.9     3.4
Tax incentives                                     (0.7)   (0.7)
Higher rates of overseas corporation tax             1.8     1.6
Non-deductible expenditure                             -     0.1
Deduction for gains on employee share options      (0.3)   (0.1)
Adjustments in respect of prior year               (0.2)     0.2
 
Tax charge for the year                              4.5     4.5


4. Dividends

Amounts recognised as distributions to equity holders in the period

                                                  2013                    2012
                                        Pence per                 Pence per           
                                          share       £ Millions    share      £ Millions

Prior year third quarter dividend paid     12.0    *     2.3         11.0         2.1
Prior year final dividend paid             17.0    *     3.2         15.0         2.8
First quarter dividend paid                11.0    ^     2.1         10.0   *     1.9
Second quarter dividend paid               12.0    ^     2.3         11.0   *     2.1
 
Total                                      52.0          9.9         47.0         8.9

* Dividends in respect of 2012 (50.0p)
^ Dividends in respect of 2013 (55.0p)

A dividend of 13.0 pence per share was paid in respect of the Third Quarter of
2013 on 10 January 2014.

The proposed final dividend for 2013 of 19.0 pence per share is subject to
approval by shareholders at the Annual General Meeting scheduled for 8 April
2014 and has not been included as a liability in these financial statements.
It is proposed that the final dividend be paid on 10 April 2014 to members on
the register as at 14 March 2014.


5. Earnings per share

The calculations of the basic and diluted earnings per share attributable to
the ordinary equity holders of the parent are based on the following data:

                                                               2013       2012
                                                         £ Millions £ Millions
Earnings
Earnings for the purposes of basic
and diluted earnings per share
(profit for the year attributable to
equity shareholders of the parent)                             18.2       15.5
 
Number of shares
 
Weighted average number of shares
for the purposes of basic
earnings per share (thousands)
                                                             18,990     18,978
 
Effect of potentially dilutive share options (thousands)        157         76
 
Weighted average number of shares for the purposes of
dilutive earnings per share (thousands)                      19,147     19,054
 
Earnings per share from operations
Basic                                                         95.8p      81.7p
Diluted                                                       95.1p      81.3p


6. Borrowings

The borrowings are repayable as follows:

£ Millions                                                     2013       2012
 
On demand or within one year                                    8.5        7.3
In the second year                                                -        7.4
                                                                8.5       14.7
Less: Amounts due for settlement within 12 months
(shown under current liabilities)                             (8.5)      (7.3)
 
Total repayable after 12 months                                   -        7.4


The other principal features of the Group's borrowings are as follows:

1. Bank overdrafts are repayable on demand. The bank overdrafts are secured on
the assets of the Group. At 31 December 2013, the Group had an overdraft of
£1.2 million (2012: £3.6 million). In October 2013, the Group renewed its
annual working capital facility, which is reduced from US$12.5 million (£7.7
million) to US$10.0 million (£6.1 million) in the prior year, priced at Bank
of Scotland's base rate plus a margin of between 2.0% and 3.0% depending on
the ratio of Net Debt to EBITDA.

2. The Group has a term debt facility with Bank of Scotland PLC at US$12.0
million (£7.3 million) with quarterly repayment of US$1.5million (£0.9
million) and a final repayment of US$9.0 million (£5.5 million) due in expiry
of the facility in September 2014. The term loan is priced at LIBOR plus a
margin of between 1.75% and 2.25% depending on the ratio of Net Debt to
EBITDA.

3. The Group has pledged all assets as collateral to secure banking facilities
granted to the Group.

4. Management assessed all loan covenants have been complied with as of 31
December 2013.

7. Deferred consideration

The Group owns 84.0% (2012: 84.0%) of the shares of Powersolve Electronics
Limited ("Powersolve") and had entered into an agreement on 19 December 2011
to purchase the remaining 16.0% of the shares in 2017.

The commitment to purchase the remaining ownership has been accounted for as
deferred consideration and is calculated based on the expected future payment
which will be based on a predefined multiple of the earnings for 3 years
ending 2016.

8. Principal risks and uncertainties

Board Responsibility

Like many other international businesses the Group is exposed to a number of
risks which may have a material effect on its financial performance. The Board
has overall responsibility for the management of risk and sets aside time at
its meetings to identify and address risks.

Risks Specific to the Industry in which the Group Operates

Fluctuations in foreign currency

The Group deals in many currencies for both its purchases and sales including
US Dollars, Euro and its reporting currency Pounds Sterling. In particular,
North America represents an important geographic market for the Group where
virtually all the revenues are denominated in US Dollars. The Group also
sources components in US Dollars and the Chinese Yuan. The Group therefore has
an exposure to foreign currency fluctuations. This could lead to material
adverse movements in reported earnings.

Risk mitigation - The Group reviews balance sheet and cash flow currency
exposures and where considered appropriate uses forward exchange contracts to
hedge these exposures. Any forward contract requires the approval of both the
Chairman and Chief Executive.

Competition

The power supply market is diverse and competitive in Asia, Europe and North
America. The Directors believe that the development of new technologies could
give rise to significant new competition to the Group, which may have a
material effect on its business. At the lower end of the Group's target market
the barriers to entry are low and there is, therefore, a risk that competition
could quickly increase particularly from emerging low cost manufacturers in
Asia.

Risk mitigation - The Group reviews activities of its competition, in
particular product releases and stays up to date with new technological
advances in our industry especially those relating to new components and
materials. The Group also tries to keep its cost base competitive by operating
in low cost geographies where appropriate.

Risks Specific to the Group

Dependence on manufacturing facilities

The Group is dependent on its manufacturing facilities in China and Vietnam
for the production of the majority of its products. Any issues that cause
disruption at these production facilities could have a material adverse effect
on their businesses.

Risk mitigation - The Group reviews the risks that may cause a disruption in
supply and has developed disaster recovery plans to help cope with unexpected
events.

Dependence on key personnel

The future success of the Group is substantially dependent on the continued
services and continuing contributions of its Directors, senior management and
other key personnel. The loss of the services of any of their respective
executive officers or other key employees could have a material adverse effect
on their businesses.

Risk mitigation - The Group undertakes performance evaluations and reviews to
help it stay close to its key personnel. Where considered appropriate the
Group also makes use of financial retention tools such as equity awards.

Loss of key customers/suppliers

The Group is dependent on retaining its key customers and suppliers. Should
the Group lose a number of its key customers or a key supplier this could have
a material impact on the Group's businesses financial condition and results of
operations. However, for the year ended 31 December 2013, no one customer
accounted for more than 5% of revenue.

Risk mitigation - The Group mitigates this risk by providing excellent
service. Customer complaints and non-conformances are reviewed monthly by
members of the executive management team. On the supply side we conduct
regular audits of our key suppliers and in addition keep large amounts of
safety inventory of key components.

Shortage, non-availability or technical fault with regard to key electronic
components

The Group is reliant on the supply, availability and reliability of key
electronic components. If there is a shortage, non-availability or technical
fault with any of the key electronic components this may impair the Group's
ability to operate its business efficiently and lead to potential disruption
to its operations and revenues.

Risk mitigation - The Group mitigates this risk by keeping large safety
inventories of key components.

Fluctuations of revenues, expenses and operating results

The revenues, expenses and operating results of the Group could vary
significantly from period to period as a result of a variety of factors, some
of which are outside its control. These factors include general economic
conditions, adverse movements in interest rates, conditions specific to the
market, seasonal trends in revenues, capital expenditure and other costs, the
introduction of new products or services by the Group, or by their
competitors. In response to a changing competitive environment, the Group may
elect from time to time to make certain pricing, service, marketing decisions
or acquisitions that could have a short term material adverse effect on the
Group's revenues, results of operations and financial condition.

Risk mitigation - The Group's profitable and robust business model helps
mitigate risks from the factors set out above.

Management stretch

The management team is likely to be faced with increased challenges associated
with any sustained adverse macroeconomic conditions. With the financial
markets uncertain, the management team must also be able to adapt to the
changing conditions and implement corrective measures as they are needed. It
could adversely affect the Group if the management team is not able to
successfully cope with these challenges.

Risk mitigation - Performance against key goals and resourcing of these is
reviewed at the executive management team meetings.

Information Technology Systems

The business of the Group relies to a significant extent on information
technology systems used in the daily operations of its operating subsidiaries.
Any failure or impairment of those systems or any inability to transfer data
onto any new systems introduced could cause a loss of business and/or damage
to the reputation of the Group together with significant remedial costs.

Risk mitigation - The Group has disaster recovery plans in place to help deal
with disruption including information technology issues. The Group's key data
is replicated on different sites and backed up. In 2014 we will also be moving
certain of our systems into the cloud.

Risks relating to taxation of the Group

The Group is exposed to corporation tax payable in many jurisdictions
including the USA where the effective rate can be as high as 40.0%, the UK
where the corporation tax rate is currently 23.0% and a number of European
jurisdictions where the rates vary between 22.0% and 33.3%. In addition, the
Group has manufacturing activities in China and Hong Kong where the
corporation tax rates are 25% and 16.5% respectively and sales companies in
Singapore and Switzerland where the corporation tax rates are 17.0% and 18.0%
respectively.

The effective tax rate of the Group is affected by where its profits fall
geographically. The Group effective tax rate could therefore fluctuate over
time. This could have an impact on earnings and potentially its share price.

Risk mitigation - The Group has a Treasurer who keeps our taxation position
under review.

8. Responsibility Statement

The Directors' confirm to the best of their knowledge and belief that this
condensed set of financial statements:

- gives a fair view of the assets, liabilities, financial position and profit
of the Group; and

- includes a fair review of the information required by the Disclosure and
Transparency Rules.

9. Other information

XP Power Limited (the "Company") is listed on the London Stock Exchange and
incorporated and domiciled in Singapore. The address of its registered office
is 401 Commonwealth Drive, Lobby B, #02-02, Haw Par Technocentre, Singapore
149598.

The financial information set out in this announcement does not constitute the
Company's statutory accounts for the years ended 31 December 2012 or 2013. The
financial information for the year ended 31 December 2012 is derived from the
XP Power Limited statutory accounts for the year ended 31 December 2012, which
have been delivered to the Accounting and Corporate Regulatory Authority in
Singapore. The auditors reported on those accounts; their report was
unqualified. The statutory accounts for the year ended 31 December 2013 will
be finalised on the basis of the financial information presented by the
directors in this preliminary announcement and will be delivered to the
Accounting and Corporate Regulatory Authority in Singapore following the
Company's Annual General Meeting.

Whilst the financial information included in this preliminary announcement has
been computed in accordance with International Financial Reporting Standards
(IFRSs), this announcement does not itself contain sufficient information to
comply with IFRSs. The Company expects to publish full financial statements
that comply with IFRSs later this month.

This announcement was approved by the directors on 24 February 2014.