Interim Results

4Less Group plc (The)
16 December 2004

                              The 4Less Group Plc

           Interim results for the six months ended 30 September 2004

Key points:

  • Pre tax loss £476,000 (2003: Pre tax profit £201,000)

  • Turnover of £181m (2003: £157m)

  • Net cash of £1.2 m as at 30 September 2004

  • Management reorganisation

  • Focus on cost reduction


Contacts

The 4Less Group                      020 7594 0515
Eric Peacock , Chairman
Nigel Paul, Chief Executive

Corporate Synergy Plc                020 7626 2244
Justin Lewis
Oliver Cairns


Chairman's Statement

The 6 month period to 30 September 2004 has been one of substantial investment
in both the existing and new divisions within the Group.  However the Group has
failed to achieve internal as well as market expectations for the period under
review and consequently expects to make a loss for the year to 31 March 2005.

Interims

For the six months ended 30 September 2004 the Group made a loss before tax of
£476,000 (2003: Profit £201,000) on turnover of £181 million (2003:
£157million).  As at 30 September 2004 the Group had gross cash balances of
£7.1million of which £1.2million represented net cash resources available to the
Group.

The core areas of the business, being Currencies4less, PropertyFinance4Less and
CarFinance4Less, have generated turnover and gross profit substantially in
accordance with the Group's forecast.  However administrative expenses, in
particular marketing expenses, were higher than forecast.  In addition, the
Group has fully provided for certain non recurring costs, of approximately
£300,000.

Review

In view of the results for the first six months of the year and the anticipated
underperformance for the year as a whole, as announced on 9 December 2004, the
Board is carrying out a review of the company's business including its strategic
direction, individual operating units and general management resourcing and
effectiveness.

Whilst the review is ongoing the board have identified the need to make
management changes in the short term.  Nigel Paul has been appointed Chief
Executive with immediate effect.  Charles McLeod has become Deputy Chairman with
a specific role in generating high level sales opportunities.  Eric Peacock,
Chairman, has agreed to make additional time available to lead the Group's
marketing activities.

Ian Collins, currently financial controller, has been appointed to the board as
Finance Director. Greg Begley has stepped down from the board to focus on the
development of FLG Corporate Services and FLG Insurance Brokers as managing
director of those businesses.

In addition, the Board have identified the need to reduce certain overheads with
immediate effect.  As part of this process, headcount has been reduced,
commission structures across the Group are being reviewed and the executive
directors have agreed to salary waivers of an average of 25 per cent for at
least six months and thereafter until such time as the Board deems appropriate.

Outlook



On the basis of these actions and a continued focus on the core strengths of the
business, it is expected that the Group will be cash flow positive and
profitable from January 2005.  Whilst the directors anticipate the Group making
a loss before tax for the full year to 31 March 2005, they do not anticipate it
exceeding the loss before tax for the first six months to 30 September 2004.

Eric Peacock
Chairman

16 December 2004


CONSOLIDATED PROFIT AND LOSS ACCOUNT


                                       Six months ended               Six months ended            Twelve months ended
                                    30th September 2004            30th September 2003                31st March 2004
                                            (unaudited)                    (unaudited)                      (audited)

TURNOVER                                    181,150,550                    157,409,015                    319,169,452
Cost of sales                              (179,397,494)                  (156,005,014)                  (316,264,498)

GROSS PROFIT                                  1,753,056                      1,404,001                      2,904,954   
                       
Administrative expenses                      (2,330,901)                    (1,271,006)                    (2,736,518)

OPERATING (LOSS)/ PROFIT                       (577,845)                       132,995                        168,436

Interest receivable and similar
income                                          103,544                         68,005                        133,496
                                                
Interest payable and similar
charges                                          (1,586)                             0                         (4,011)
                                                 
PBIT                                           (475,887)                       201,000                        297,921

TAXATION                                         68,000                        (60,000)                       (96,152)

PROFIT FOR THE FINANCIAL YEAR                  (407,887)                       141,000                        201,769

(Loss)/Earnings per share - basic                 (5.26)p                         2.74p                         3.923p

- diluted                                         (4.83)p                         2.67p                         3.815p



CONSOLIDATED BALANCE SHEET


                                               Six months ended           Six months ended        Twelve months ended
                                            30th September 2004        30th September 2003            31st March 2004
                                                    (unaudited)                (unaudited)                  (audited)

FIXED ASSETS
Tangible                                                285,688                    211,053                    299,516
Investments                                                   0                          0                          0

                                                        285,688                    211,053                    299,516

CURRENT ASSETS
Debtors                                                 983,853                    998,027                    608,220
Cash at bank and in hand                              7,148,455                  6,013,813                  7,844,363

                                                      8,132,308                  7,011,840                  8,452,583

CREDITORS: amounts falling due within one
year                                                 (7,102,280)                (6,841,773)                (8,310,210)
                                                     
NET CURRENT ASSETS                                    1,030,028                    170,067                    142,373

TOTAL ASSETS LESS CURRENT LIABILITIES                 1,315,717                    381,120                    441,889

CREDITORS: amounts falling due after one
year                                                          0                          0                          0
                                                              
NET ASSETS                                            1,315,717                    381,120                    441,889

CAPITAL AND RESERVES
Called up share capital                                  79,760                     51,427                     51,427
Share premium account                                 1,414,187                    160,805                    160,805
Profit and loss account                                (178,231)                   168,888                    229,657

EQUITY SHAREHOLDERS FUNDS                             1,315,717                    381,120                    441,889

                                                      




CONSOLIDATED CASH FLOW STATEMENT


                                                      Six months ended        Six months ended    Twelve months ended
                                                   30th September 2004     30th September 2003        31st March 2004
                                                           (unaudited)             (unaudited)              (audited)

Reconciliation of operating loss to net cash
(outflow) inflow

Operating profit                                              (577,845)                133,000                168,436
Depreciation of tangible fixed assets                           77,910                  40,682                108,113
Increase in debtors                                           (375,633)               (746,462)              (397,280)
Decrease in creditors                                       (1,207,930)              2,072,859              3,520,958

Net cash (outflow / inflow) from operating activities       (2,083,498)              1,500,079              3,400,227

CASH FLOW STATEMENT
Net cash (outflow)/inflow from operating activities         (2,083,498)              1,500,079              3,400,227
Returns on investments and servicing of finance                101,957                  68,000                129,485
Taxation                                                        68,000                 (60,000)               (35,189)
Capital expenditure                                            (64,082)               (163,864)              (319,758)
Cash (outflow)/inflow before financing                      (1,977,623)              1,344,215              3,174,765
Financing:
Proceeds of AIM flotation                                    1,700,000                       0                      0
Less associated costs of flotation                            (418,285)                      0                      0

(Decrease)/increase in cash in the year                       (695,908)              1,344,215              3,174,765

Reconciliation of net cash flow to movement in net
funds
(Decrease)/increase in cash in the year                       (695,908)              1,344,215              3,174,765

Change in net funds                                           (695,908)              1,344,215              3,174,765
Net funds at 1 April 2004                                    7,844,363               4,669,598              4,669,598

Net funds at 30 September 2004                               7,148,455               6,013,813              7,844,363


1.                   Nature of Information

The interim accounts for the six months ended 30 September 2004 and the
comparative figures for the six months ended 30 September 2003 are unaudited but
have been reviewed by the Company's auditors.  The comparative figures for the
twelve months ended 31 March 2004 are not the Company's statutory accounts
within the meaning of section 240 of the Companies Act 1985 but are abridged
from such accounts which have been reported on by the Company's auditors and
delivered to the Registrar of Companies.  The report of the auditors on such
accounts was unqualified and did not contain any statement under Sections 237(2)
or 237(3) of the Companies Act 1985.

The interim accounts and the comparative figures are prepared on the basis of
the accounting policies set out in the accounts of the Group for the twelve
months ended 31st March 2004.

2.                   Segmental Information

An analysis of turnover and profit after tax by class of business is given
below:


                                              Six months ended          Six months ended        Twelve months ended
                                           30th September 2004       30th September 2003            31st March 2004
                                                    (unaudited)               (unaudited)                  (audited)
Turnover

Provision of foreign currency                      180,898,968               157,196,132                318,779,410
Arranging car finance                                   90,014                   135,707                    205,389
Arranging property finance                             157,881                    76,995                    184,653
Arranging of insurance                                   3,687                         0                          0

                                                   181,150,550               157,408,834                319,169,452

All turnover arose within the United Kingdom

Profit before tax

Provision of foreign currency                          451,379                   317,913                  1,091,701
Arranging car finance                                   15,357                     2,585                    (36,308)
Arranging property finance                              (6,895)                     (965)                    17,604
Arranging of insurance                                 (55,205)                        0                          0
Group costs                                           (880,523)                 (118,524)                  (775,076)

                                                      (475,887)                  201,009                    297,921

3.                   Taxation

Based on the results of the period, the Group believe that the amount of tax
recoverable is in the region of £68,000

4.         Copies of this interim announcement will be available from the
Company's registered office, 16 Brompton Road London SW3 1HW.


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