AGM Statement

Character Group PLC
21 January 2004

Issued by Citigate Dewe Rogerson Ltd, Birmingham
Wednesday, 21 January 2004
                                                               IMMEDIATE RELEASE

                            The Character Group PLC
                             Annual General Meeting

At today's Annual General Meeting (21 January 2004) Richard King, Chairman told
shareholders:

'Sales for the Group for the four months to 31 December 2003 rose by
approximately 8.5% over the corresponding period for the previous year. Set
against the generally difficult trading conditions in the UK in the run up to
Christmas, this increase was satisfactory, although it was nevertheless
disappointing with sales of toys, games and gifts not reaching their full
potential.

'The Digital Division, however, saw an impressive growth of approximately 145%
over the period. This increase was achieved in spite of experiencing certain
difficulties with our US distribution which have already been addressed by the
recent appointment of a new distributor who has formed a new division to
concentrate on the distribution of our digital ranges. We believe that this
distributor will take advantage of its extensive customer base in the US, and
that we shall see substantial growth in US sales during the second half of the
year.

'In the UK, our digital sales have grown more than tenfold, and this has firmly
put us into the market as a major digital supplier. Sales in other international
territories are developing well.

'The lower than projected sales in the Toys and Games, and Giftware divisions,
the additional costs incurred in changing the US distributor, and as alluded to
in the annual report, the costs incurred in our extensive new product
development programme, where we are yet to see any material benefit, are likely
to cause a drop in profitability at the interim stage when compared to the same
period last year.

'Following the conversion of the loan stock in December, the Group is today
completely ungeared, with no bank overdraft or other borrowings.

'The directors believe that the outcome for the year as a whole will be
satisfactory and in line with market expectations.'

Enquiries:
Richard King, Chairman                       Fiona Tooley, Director
Kiran Shah, Group Finance Director           Katie Dale, Account Manager
The Character Group plc                      Citigate Dewe Rogerson
Today: 020 7282 8000                         Today: 0207 282 8000
Thereafter: 020 8949 5898                    Thereafter: 0121 455 8370
Mobile: [phone] (RK)                    Mobile: [phone] (FMT)
Mobile: [phone] (KS)                    Mobile: [phone] (KD)
www.charactergroup.plc.uk
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