Interim Results

Mercury Recycling Group PLC
25 September 2001


 
                         MERCURY RECYLING GROUP PLC
                       ANNOUNCEMENT OF INTERIM RESULTS


Chairman's Statement

I am pleased  to present your Company's first report for the period to 30 June
2001.

The unaudited accounts for the period to 30 June 2001 for Mercury Recycling
Group plc (formerly Argon Group Plc) ('MRG') show an overall loss before
taxation for the period of £112,000.  These results only include two months'
trading of the new business and include non-recurring items amounting in
aggregate to £63,000.  The results for Mercury Recycling Limited ('MRL') for
the two months since 4 May 2001 when it joined the Group show it generated an
operating profit of £7,000 before goodwill amortisation.  Being such a short
period, the Directors do not believe this result reflects the prospects for
MRL in the longer term.  The non-recurring items comprise restructuring costs
of £34,000 and abortive acquisition costs of £29,000.  The Directors do not
believe that it would be appropriate to declare a dividend at this stage.

In future years, MRL can be expected to benefit from the ever growing concern
about environmental issues.  The business of recycling fluorescent tubes and
highway lamps is just one of the answers to the many problems. It is now
generally recognised that a single fluorescent tube contains enough mercury to
contaminate up to 30,000 litres of water.  Moreover, a new study has found
that landfill disposal of such products can chemically alter the mercury in
them, not only rendering it more toxic, but also fostering its release into
the air.  The estimate by Government and the Industry is that some 80-100
million tubes and bulbs are disposed of each year in landfill;  on the
evidence this is clearly unsatisfactory.  As the UK's first licensed recycler
of fluorescent tubes and lamps, MRL is currently processing approximately 3-4
million tubes a year, the balance ends up in landfill sites which must
adversely affect the environment.

The European Directive on Waste Electrical and Electronic Equipment has now
been adopted by the European Commission and implementation is awaited.  Once
implemented fluorescent tubes will have to be handled in a special manner and
the Directors believe that the market will recognise that recycling is the
best option available, being both environmentally friendly and commercially
acceptable.  The Directors anticipate that this European Directive will
increase the business of MRL which is in a strong position to take advantage
of legislative changes, having the capacity and financial resources to support
future growth.  The Company's net cash balances at 30 June 2001 were £378,000,
with no outstanding bank borrowings and the Directors believe that the Company
has sufficient manufacturing capacity to take advantage of the expected
increase in demand.

Our current forecasts, whilst indicating continuing growth as evidenced by the
growing list of blue chip customers, take no account of the changes I have
referred to.  Exciting prospects are certain to arise from the new
environmental developments.  Moreover, no account been taken of potential
mergers and acquisitions which may be made possible by the flotation nor of
the possibility of looking at expanding into other recycling fields.


The Rt Hon The Lord Barnett JP PC
Chairman
25 September 2001


GROUP PROFIT AND LOSS ACCOUNT
for the period ended 30 June 2001

                                              Continuing   Acquisition    Total
                                              operations           MRL
                                                   £'000         £'000    £'000

Turnover                                               0            97       97
Cost of sales                                          0           (5)      (5)

Gross profit                                           0            92       92

Operating expenses
Administrative expenses (pre-acquisition
£31,000 post-acquisition £15,000)                   (46)          (85)    (131)
Restructuring costs                                 (34)             0     (34)
(non recurring)
Abortive acquisition costs                          (29)             0     (29)
(non recurring)
Goodwill amortisation                                  0          (27)     (27)

                                                   (109)         (112)    (221)

Operating loss                                     (109)          (20)    (129)

Exceptional items
Profit on disposal of investment                                             20

Loss on ordinary activities before                                        (109)
interest

Interest receivable                                                           6
Interest payable                                                            (9)

Loss on ordinary activities before                                        (112)
taxation

Taxation                                                                      0

Loss on ordinary activities after                                         (112)
taxation retained for the period

Earnings per share
- Basic (pence per share)                                                (0.99)
- Diluted (pence per share)                                              (0.98)



Notes:

1.   Basic loss per share has been calculated using a loss for the financial
period of £112,000 and a weighted average number of ordinary shares in issue
during the period of 11,322,444.

Diluted loss per share has also been calculated using the same loss and
weighted average number of ordinary shares in issue, diluted by the number of
ordinary shares under option of 100,000.

2.   The Directors do not recommend the payment of an interim dividend.


GROUP BALANCE SHEET
as at 30 June 2001

                                                        £'000             £'000
Fixed assets
Tangible assets                                                             312
Intangible assets                                                         3,270
                                                                          3,582
Current assets
Stock                                                       2
Debtors                                                   193
Cash at hand and in bank                                  378
                                                          573

Creditors: amounts due within one year                  (110)

Net current assets                                                          463

Total assets less current liabilities                                     4,045

Creditors: amounts due after more than one year                           (233)

Net assets                                                                3,812


Capital and reserves:
Called up share capital                                                   2,512
Share premium account                                                     1,523
Merger reserve                                                            (111)
Profit and loss account                                                   (112)
Shareholders' funds                                                       3,812




GROUP CASH FLOW STATEMENT
for the period ended 30 June 2001

                                                                 £'000   £'000

Net cash outflow from operating activities                                (69)

Returns on investment and servicing of finance
Interest paid                                                      (9)
Interest received                                                    6

                                                                           (3)

Capital expenditure and financial investment
Receipts from sale of investment                                   100
Purchase of tangible fixed assets                                  (7)

                                                                            93

Acquisitions
Cash acquired with subsidiary undertakings                                 111

Net cash inflow before management of liquid resources and                  132
financing

Financing
Repayment of loans                                               (140)
Capital element of hire purchase                                   (4)
Issue of share capital (net of expenses)                           740

Net cash inflow from financing                                             596

Increase in cash in period                                                 728


Reconciliation of operating loss to net cash outflow from                £'000
operating activities
Operating loss                                                           (129)
Depreciation                                                                 6
Amortisation of goodwill                                                    27
Decrease in stocks                                                           2
Decrease in debtors                                                          8
Increase in creditors                                                       17
Net cash outflow from operating activities                                (69)


NOTES:

1.   The unaudited interim financial information was approved by the Directors
on 24 September 2001.  Copies of this interim report are being sent to all of
the Company's shareholders.  Further copies can be obtained from the Company's
registered office.

2.   The unaudited financial information included in this report has been
prepared in accordance with applicable accounting standards.

3.   These accounts consolidate the accounts of Mercury Recycling Group plc
and all of its wholly owned subsidiaries.

4.   The goodwill arising on the acquisition of MRL has been capitalised and
amortised over the Directors' estimate of its useful economic life.