Interim Results - Part 2

Microgen PLC
5 September 2000


PART 2


2/2

                          
5 SEPTEMBER 2000

MICROGEN plc ('Microgen')

Interim Results for the Six months ended 30 June 2000




NOTES:

1.   Turnover, profit and net assets analysis

                                 Unaudited Unaudited   Restated         
                                  6 months  6 months       year         
                                     ended     ended      ended
                                   30 June   30 June         31   
                                      2000      1999   Dec 1999
                                      £000      £000       £000  
                                               
     Turnover                                        
     Continuing operations                                     
     -   Billing   &   database      
     management                      7,223     7,500     14,917
     - Consultancy                   3,771     1,213      4,691
                                    ------     -----     ------
                                    10,994     8,713     19,608
                                                               
     Discontinued operations                                   
     -   Billing   &   database      2,766     6,759     11,716
     management                    -------    ------    -------
                                    13,760    15,472     31,324
                                                               
     Operating profit/(loss)                                   
     Continuing Operations                                     
     -   Billing   &   database        
     management                        257       302      1,636
     - Consultancy                     901       208        758
     - Group overhead              (1,391)     (972)    (1,882)
                                                               
     Total continuing                                
     operations  before   share      
     price and property
     provision  movements   and
     amortisation                    (233)     (462)        512
                                                               
     Charges  related to  share      (119)      (70)      (275)
     price movements
     Property provision                350         -      (299)
     movements
     Goodwill amortisation           (627)     (208)      (836)
     Total continuing                
     operations                      (629)     (740)      (898)
                                                               
     Discontinued operations                                   
       -  Billing and  database      
     management                      (488)     1,703      2,446
                                   -------    ------     ------                
            
     Operating (loss)/profit       (1,117)       963      1,548

2.   Taxation

The tax credit for the period was £351,000 (1999: charge 
£555,000) based on the estimated effective tax rate for 
the year.


3.   Earnings per Share

                                Unaudited  Unaudited   Restated
                                 6 months   6 months year ended
                                    ended      ended     31 Dec        
                                   30 June   30 June       1999
                                     2000       1999     
                                                       
                                         
                                                               
     Basic earnings per share      (4.9)p       2.1p       3.7p
                                                               
     Diluted earnings per share    (4.7)p       2.1p       3.6p
                                                               
     Adjusted   basic  earnings                                
     per share (before               
     exceptional items,
     goodwill amortisation  and
     charges relating to  share
     price movements)                0.2p       2.5p       5.8p
                                                               
     Adjusted  diluted earnings                                
     per share (before               
     exceptional items,
     goodwill amortisation  and
     charges relating to  share
     price movements)                0.2p       2.5p       5.7p

Adjusted and basic earnings per share are based on the share 
capital of 50,509,231 shares (1999: 46,253,994) being the 
weighted average number of shares in issue during the year. 
Diluted earnings per share are based on share capital of 
52,769,356 (1999: 46,915,716).

A reconciliation of earnings to adjusted earnings is set out below:

                                              Basic     Diluted
                                 Earnings       EPS         EPS
                                     £000     Pence       Pence
                                                               
     Loss on ordinary             
     activities after tax         (2,457)     (4.9)       (4.7)
     Share price movements (net        
     of tax)                           83       0.2         0.2
     Goodwill amortisation            627       1.2         1.2
     Exceptional loss on            
     disposal of discontinued
     operations (net of tax)        1,760       3.5         3.3
     Goodwill previously              
     written off relating to
     disposal of discontinued
     operations                       100       0.2         0.2
     Profit on ordinary              ----      ----        ----                
          
     activities after tax but                                  
     before exceptional items,        
     goodwill and charges
     related to positive share
     price movements                  113       0.2         0.2

4.    Debtors

                                    As at        As at        As at
                             30 June 2000 30 June 1999  31 Dec 1999
                                    £'000        £'000        £'000
                                                                
     Trade debtors                  3,873        5,244        4,099
     Corporation tax                    -          961            -
     recoverable
     Other debtors                    679          328          236
     Prepayments and                  538          649          520
     accrued income                ------        -----        -----
                                    5,090        7,182        4,855


5.   Creditors: due within one year

                              As at             As at         As at
                       30 June 2000      30 June 1999   31 Dec 1999
                              £'000             £'000         £'000
                                                   
     Net obligations                  
     under finance
     leases                     701               279           469
     Trade creditors          1,029             1,197         1,508
     Corporation tax            393             6,246           655
     Other taxes and                  
     social security
     costs                      796             1,042           689
     Other creditors            293               221           314
     Deferred                       
     consideration on
     acquisition              2,430             1,807         1,807
     Loan notes payable       4,600             4,600         4,600
     Accruals                 3,724             5,053         2,944
     Proposed dividend            -               254           508
                            -------           -------        ------
                             13,966            20,699        13,494
                                                   


6.   Creditors: due after more than one year

                            As at        As at       As at
                          30 June      30 June      31 Dec 
                             2000         1999        1999          
                            £'000        £'000       £'000
                                                       
     Net obligations           
     under finance
     leases                     -          997         546
     Deferred                 
     consideration on
     acquisition                -          623         623
     Other taxes and         
     social security
     costs                    105           10          96
                           ------        -----       -----
                              105        1,630       1,265

7.   Share Capital

                                          Number                    £

     Authorised ordinary             
     shares of 5p each                70,000,000            3,500,000
     Issued allotted and                                             
     fully paid:                      50,858,601            2,542,930
     At 1 January 2000
     Issued under share                                              
     option schemes:                      
     Savings related                      21,275                1,064
                                      ----------           ----------
     At 30 June 2000                  50,879,876            2,543,994


8.   Reserves

                                -------- Profit & Loss Account-------
                             
                             Share    Other  Revenue Goodwill  TOTAL
                           Premium Reserves  Reserve  Reserve      
                           Account                                      
                             £'000    £'000    £'000    £'000  £'000
     At 1 January 2000      16,762      150   27,830 (11,744) 16,086
     Restatement of                                       
     opening balance             -        -      401        -    401
     (note 10)
     Restated 1 January     16,762      150   28,231 (11,744) 16,487
     Retained profit              
     for the period              -        -  (2,457)       - (2,457)
     Exchange rate               -        -       12       -      12
     adjustments
     Shares issued              23        -        -       -       -
     during the period
     Goodwill on                 
     discontinued                                     
     businesses                  -        -        -     100     100
     transferred to
     profit & loss
     account
     Arising on grant                                      
     of share options            -       50        -       -       -
                           -------  -------  ------- -------  ------           
                                
                                                                         
     At 30 June 2000        16,785      200   25,786(11,644)  14,142



9.   Notes to the Consolidated Cash Flow Statement

(i)   Reconciliation of operating (loss)/profit to net cash flow 
from operating activities:

                                         
                                   6 months   6 months    Restated
                                      ended      ended  year ended
                                    30 June    30 June      31 Dec 
                                       2000       1999        1999
                                      £'000      £'000       £'000
     Operating                        
     (loss)/profit                  (1,117)        963       1,548
     Depreciation                     1,148      1,104       2,305
     Loss/(profit) on                      
     disposal of tangible
     fixed assets                        17       (24)       (106)
     Other non-cash                       
     movements                          396        258       1,111
     (Increase)/decrease in           (376)        801       5,292
     debtors
     Decrease in stocks                 109        258         100
     Decrease in creditors            (128)      (494)     (5,603)
                                                                            
     Net Cash inflow from          --------     ------     -------      
     operating activities                49      2,866       4,647



(ii)  Reconciliation of net cash flow to movement in net funds:

                               6 months       6 months    Restated
                                  ended          ended  Year ended   
                                30 June        30 June      31 Dec 
                                   2000           1999        1999            
                                  £'000          £'000       £'000
     (Decrease)/increase in          
     cash in the period         (1,499)          (541)       1,277
     Cash outflow from                      
     decrease in lease
     financing                      314            359        620
     Cash inflow/(outflow)                   
     from movement in term
     deposits                       766        (3,902)    (9,148)
     Change in net funds        -------        -------    -------           
     resulting from cash flow     (419)        (4,084)    (7,251)
                                                                               
 
     Issue of new loan notes          -        (4,600)    (4,600)
     Movement in net funds in   -------        -------   --------         
     the period                   (419)        (8,684)   (11,851)
                                                                               
 
     Net funds at beginning of   
     period                      13,209         25,060     25,060
                                           
     Net funds at end of        -------        -------   --------
     period                      12,790         16,376     13,209

(iii)     Analysis of net funds

                         1 Jan    Cash    30 June
                          2000    Flow       2000
                                                
                          £000    £000       £000
                                                
     Cash   at   bank   
     and in hand        18,824   (733)      18,091
                                                
     Debt  due within  
     1 year            (4,600)       -     (4,600)
                                                
     Finance leases    (1,015)     314       (701)
                       -------  ------     -------                       
     Total              13,209   (419)      12,790


10.  Compliance with UITF Abstract 25 (National 
Insurance Contributions onshare option gains)

Employers' National Insurance Contributions relating 
to gains on share options are accrued based on the share
price movement from the date of grant to that ruling at 
the balance sheet date. During 1999, the first
period in which such charges arose, the total liability
was accrued and charged to the profit and loss account.  
The recently issued Urgent Issues Task Force Abstract 25
(National Insurance Contributions on share option gains) 
requires that the total cost be amortised over the vesting
period of the relevant share option.  The UITF 25 treatment 
has been adopted in the current period and, as this is a 
change in accounting policy, the prior year comparatives 
have been adjusted.  The December 1999 comparative balance
sheet and the profit and loss account have now been restated.
The impact of this restatement has been to increase net
assets at 31 December 1999 by £0.4m by reducing Creditors
due after more than one year by £0.6m, increasing corporation 
tax creditor by £0.2m and to increase 1999 reported post tax 
profit by £0.4m.



11.  Statement by the directors

The figures in the Group Profit and Loss Account and 
Consolidated Balance Sheet do not amount to full accounts
within the meaning of Section 254 of the Companies Act 1985.
Full accounts of Microgen plc for the year ended 31 December
1999, on which the auditors gave an unqualified report, have
been delivered to the Registrar of Companies.

This interim statement has neither been audited nor reviewed 
by the Company's Auditors.

Copies  of  this statement are being posted to shareholders
and will  also available   on   the   investor   relations  
page   of   our   web   site (www.microgen.co.uk). Further 
copies are available on request and free  of charge  from  
the Company Secretary at 11 Park Street, Windsor,  Berkshire
SL4 1LU.