Pre-close update

Deltex Medical Group PLC
23 January 2008

                            Deltex Medical Group plc

              Pre-close update on the year ended 31 December 2007

23 January 2008 Deltex Medical Group plc ('Deltex Medical' or the 'Company'),
the UK's leading haemodynamic monitoring company, today announces an update on
its development and trading performance for the year ended 31 December 2007.

Throughout 2007 the Company made significant progress in all of its key markets
towards its goal of establishing the use of its CardioQ(TM) oesophageal Doppler
monitor (ODM) system as a standard of care in the monitoring and management of
people undergoing major surgery. Group probe sales in each quarter throughout
both 2007 and 2006 were ahead of the corresponding quarter in the preceding
year. The directors anticipate that sales for the year will be in excess of
£4.1 million.

Nigel Keen, Deltex Medical's Chairman, commented:

'Deltex Medical continued to make significant progress during 2007 towards
establishing the CardioQ as a global standard of care. We now have increasing
momentum in the US and other key international markets as well as in the UK.'

MARKETS

United States of America

The higher level of sales experienced in the first half of the year continued
through the second half and the monthly probe sales run-rate by the end of the
year was more than half as big again as at the start of the year. Our small
field team in the US is focused on a small number of accounts with the goal of
developing a scalable business model.

The Company has set up a small number of evaluation and research projects using
the CardioQ in leading US hospitals. Once the clinical element of these projects
is finished, the Company expects to be in a position to expand these hospitals
into leading accounts.

Both the modest growth in the US in 2006 and the faster growth delivered in
2007, which was after the adverse impact of exchange rates, have been achieved
prior to any additional impetus generated from physician reimbursement and
indicate the growing interest in improving intra-operative vascular fluid
management in the USA.

United Kingdom

Sales of CardioQ monitors in 2007 were ahead of 2006 despite unusually low sales
in March as the NHS responded to political pressure to produce a surplus by
restricting expenditure prior to its year-end. A record number of CardioQ
monitors were sold during the year specifically for use in operating theatres.

In the second half of the year, surgical probe volumes overtook intensive care
probe volumes for the first time and the growth rate in surgical probe business
increased: the Directors believe that our surgical probe business is now the
fastest growing new broad application medical technology in the NHS. Record
probes sales in the final quarter of 2007 were supported by the Company's
highest ever monthly UK probe sales in December, when UK probe sales exceeded
£200,000 for the first time ever. Probe sales so far in the UK in January 2008
have been encouraging.

The launch in September 2007 of the new range of I2 probes means the Company now
has a product which allows monitoring to continue after patients wake up after
surgery, who are awake in critical care units or who are having surgery under
regional rather than general anaesthetic. Prior to the redesigned probe, volumes
in some intensive care units had been under pressure from the growing trend in
the UK towards allowing patients to be awake and spontaneously breathing while
in intensive care.

Progress in the UK continues to be slowed by the considerable barriers to
adoption of new medical technologies in the NHS. There has, however, been a
growing recognition in both the Department of Health and amongst the top
management of the NHS that UK patients suffer unduly compared to patients in
other countries through being denied access to new medical technologies.

Deltex Medical has successfully established the CardioQ, through its proven
ability to both improve outcomes and reduce costs, towards the top of the UK
innovation agenda. In September 2007 the newly formed NHS National Technology
Adoption Hub announced that the CardioQ is one of three technologies included in
its first wave of projects to help accelerate the uptake of new technology by
the NHS. The Hub's objective is to work, via its project managers, with three
selected Trusts to produce guidance to the rest of the NHS on how most
effectively to implement and derive benefit from the CardioQ. This is a new and
evolving process and, despite initial intentions to complete the procurement
element of the projects before 31 December 2007, none of the three Trusts has in
fact yet purchased any additional CardioQ monitors or probes: to this extent, UK
sales were behind expectations for the year.

The Company sold three SupraQ monitors in 2007, all in the UK, compared to 14 in
2006. Although interest in the SupraQ remains strong, the Company does not
currently intend to build any more of the current version of SupraQ and is
concentrating on developing its next generation SupraQ device which offers
significant improvements in ease of use.

International markets

Sales in our international markets were significantly ahead of those in 2007 as
the benefits of our programme to restructure our key distribution arrangements
continued. Growth has been sustained in each of our key international
territories with overall underlying growth of around 30% year on year. The
run-rate of probes sold across those territories on monthly ordering schedules
increased over the year from 550 to 800 probes per month.

Through our new direct sales operation in Spain we have been working with the
head of the Spanish Society of Surgeons to establish use of the CardioQ as a
standard of care in colorectal surgery. This pilot project involves seven key
hospitals undertaking an audit of patient outcomes under a care protocol based
on the University College London Hospital and St Thomas's Hospital's ESTREP
programme. The audit is expected to be complete in the third quarter of 2008 and
the results presented to the national colorectal surgery meeting in Spain late
in the year. If the results of the audit mirror those seen elsewhere, the
surgeons leading the project have informed the Company that they expect to see
the protocol established as standard practice across Spain.

An order for over £50,000 of probes from our distributor in Peru, which would
normally have been delivered in December, will be fulfilled in early 2008 as
soon as the new I2 probe series is ready for release in Latin America.

Increasing recognition as a standard of care

US Government health technology assessment

Health technology assessment (HTA) is at the heart of modern policy for
determining standards of care in developed healthcare systems. A typical HTA
investigates whether a health technology works, for whom it works and at what
cost: it will also look at how the use of the technology compares to any
alternatives.

The first HTA to report on ODM was published by the US Government's Agency for
Healthcare Research and Quality (AHRQ) in February 2007. It concluded that the
evidence was 'strong' that ODM-guided fluid management during surgery reduces
major complications, reduces total complications and reduces hospital stay. The
AHRQ definition of strong evidence is that 'it is highly unlikely that new
evidence will lead to a change in this conclusion'.

National US reimbursement coverage

AHRQ's HTA was commissioned by the US Centers for Medicare and Medicaid Services
(CMS) and allowed CMS to conclude in May 2007 that 'the published literature
demonstrates sufficient evidence that haemodynamic monitoring with oesophageal
Doppler does result in improved health outcomes'. As a result CMS decided to
reimburse doctors across the USA who use ODM for their time and expertise. CMS's
unusually broad coverage decision covers use for 'monitoring of cardiac output
for ventilated patients in the ICU (Intensive Care Unit) and operative patients
with a need for intra-operative fluid optimisation'.

It is well-established practice that other healthcare payers in the USA follow
CMS's lead on physician reimbursement for individual technologies. Assuming this
is the case with ODM, the Company's most conservative estimate of the number of
potential US patients is 5,000,000 per year, with scope for this estimate to
more than double as further surgical procedures are demonstrated to benefit from
care guided by the use of ODM.

The CardioQ is the only ODM system being sold in the USA today. ODM is the first
and only technology to enable intra-operative fluid optimisation and CMS's
decision separates the CardioQ's application as a dynamic guide of therapy
during surgery from its other applications in critical care medicine. In
intensive care the CardioQ is most frequently used as a traditional cardiac
output monitor and such use is also now covered by CMS.

The Company and its advisers are working closely with doctors at selected key
accounts to support the process of submission of initial clinician reimbursement
claims to local CMS agents and to negotiate and agree appropriate payment levels
with CMS. This process, which might typically be expected to take three to six
months started in September 2007 with a user on the West Coast of the United
States and is now underway with users in other CMS agency regions.

Meta-analysis

The technique of meta-analysis (a systematic scientific review which considers
related evidence as a whole) underpins many of the conclusions of HTAs. It is
also used heavily by doctors within clinical circles to determine technologies
and interventions which should be established as standards of care.

The first independent meta-analysis of the randomised controlled clinical
outcome trials of ODM was undertaken by an eminent group of UK doctors and its
results were first presented in September 2006. It concluded that ODM reduces
post-operative complications and reduces length of hospital stay by an average
of nearly three days. The results of this review were presented at a number of
important clinical meetings over 2007 and the Directors understand that the
authors intend to submit it to a leading medical journal for publication in
2008.

As we announce today, a second meta-analysis undertaken by doctors in New
Zealand has concluded that ODM 'use for monitoring and optimisation of
flow-related haemodynamic variables improves short-term outcome in patients
undergoing major abdominal surgery'. This meta-analysis has just been published
in the journal Anaesthesia and is therefore the first meta-analysis to be
published in a leading peer-reviewed journal.

The directors are not aware of any randomised controlled study either published
or pending publication which shows any technology other than ODM to have been
used successfully to direct fluid administration during surgery to improve
patient outcomes and reduce hospital lengths of stay. Alternative approaches to
haemodynamic monitoring use derived rather than direct measurements of blood
flow and are unable to report changes in flow either as quickly or as
sensitively as ODM.

London hospitals

During 2007 use of the CardioQ has been established as part of the written
standard treatment protocols for a number of surgical procedures at two of
London's most important teaching hospitals: University College London Hospital
and St Thomas's Hospital. The CardioQ has played a central role in the success
to date of the ESTREP enhanced recovery programme jointly developed between
surgeons at the two sites. After six months ESTREP had already delivered
reductions in average lengths of hospital stay of nearly a half for colorectal
surgery. Both sites are in the process of rolling the ESTREP programme out into
other surgical disciplines.

The Company has made significant progress towards establishing the CardioQ as a
standard of care for specific groups of patient in most of the other major
hospitals in London. In July 2007 the Planned Care Clinical Working Group
established as part of the Darzi Healthcare for London Review recommended
increased use of ODM. Lord Darzi has subsequently been appointed a government
health minister and is undertaking a national NHS Next Stage review based on his
work in the London review.

Surgical enhanced recovery programmes

Surgical enhanced recovery or 'fast track' programmes optimise patients' health
before, during and after surgery. They are being adopted across the UK and
Continental Europe, particularly in colo-rectal surgery. Deltex Medical has been
successful in establishing the CardioQ as a fundamental component of a
substantial majority of the successful active enhanced recovery programmes in
the UK and in many of the highest profile programmes in Continental Europe.

There are growing signs in the UK and Europe of the spread of enhanced recovery
programmes into several additional disciplines including orthopaedic, vascular,
urological and gynaecological surgery. Enhanced recovery concepts are gaining
early acceptance in the USA.

The growing clinical interest in enhanced recovery coincides with increasing
political and macro-economic pressures in the developed world to reduce lengths
of hospital stays, reduce the amount of care delivered in hospitals and provide
it instead as close as possible to the patient's home.

FINANCIAL

Cash consumption in the second half of the year and the underlying rate of cash
burn going into 2008 were in line with the Company's plans. In the second half
of the year the Company has invested in various projects to ensure its products
and facilities are suitable for the next stage of its expansion. The Company has
extended the clean room where it manufactures probes in order to double capacity
and made significant progress in re-engineering the range of probes to be more
suited to mass and automated production. A modernised and upgraded model of the
CardioQ is undergoing final testing and is expected to be launched in the first
half of 2008.

For further information, please contact:-

Deltex Medical Group plc                       01243 774 837
Nigel Keen, Chairman                           [e-mail]
Andy Hill, Chief Executive                     [e-mail]
Ewan Phillips, Finance Director                [e-mail]

Gavin Anderson & Company                       0207 554 1400
Deborah Walter                                 [e-mail]
Robert Speed                                   [e-mail]

Charles Stanley Securities 
(Nominated Adviser)                            020 7149 6000
Philip Davies                                  [e-mail]
Russell Cook                                   [e-mail]

Notes for Editors

Deltex Medical manufactures and markets the CardioQ monitor, which uses
disposable ultra-sound probes inserted into the oesophagus to determine the
amount of blood being pumped around the body - 'circulating blood volume'.
Reduced circulating blood volume is known as hypovolaemia, which leads to
insufficient oxygen being delivered to the organs. This causes medical
complications including peripheral and major organ failure which can lead to
death. Hypovolaemia, which is akin to severe dehydration, affects virtually
every patient having surgery because of the combined effects of pre-operative
starvation, the impact of the anaesthetic agents and trauma from the surgery
itself. Using fluids and drugs, guided by the CardioQ, to optimise the amount of
circulating blood significantly reduces post-operative complications allowing
patients to make a faster, more complete recovery and return home earlier.

The CardioQ incorporates the Company's proprietary software and a small
diameter, easy-to-use, minimally invasive, disposable oesophageal probe that is
used for transmitting and receiving an ultra-sound signal. By using this
technology, the CardioQ provides clinicians with the ability to optimise
critically ill patients and those undergoing routine moderate to major surgery
through the controlled administration of fluid and drugs. Haemodynamic
optimisation has been proven to improve the speed and quality of patient
recovery and reduce hospital stay.

There are already around 1,500 CardioQs currently in use in hospitals worldwide
and distribution arrangements are in place in over 30 countries. In addition,
there are currently more than 90 clinical publications on the use of the CardioQ
which have repeatedly:-

   •Validated the results of the Monitor against known standards for
    measuring cardiac output, demonstrating that the technology works

   •Proved that the CardioQ works in a wide range of surgical procedures

   •Demonstrated that the Company's technology provides significant health
    and economic benefits by helping to reduce post-operative complications and
    length of hospital stays by an average of 30 to 40 per cent for a wide range
    of patients.

The SupraQ is an entirely non-invasive device which uses an ultrasound probe
held at the base of the patient's neck to track the flow of blood in the aorta;
it presents the same data as the CardioQ in a similar format and is used for
taking snapshots or monitoring over short periods.



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