Final Results

Mears Group PLC
3 April 2001

CHAIRMAN'S STATEMENT

I am pleased to announce record profits for the year ended 31st December 2000.

Profits before tax were up 80% at £1,928,479 (1999: £1,069,040) on turnover up
49% at £70,680,186 (1999: £47,455,954).

After the amortisation of goodwill the earnings per share increased by 84% to
3.50p (1999: 1.90p). On a full tax charge the earnings per share would have
increased by 62% to 2.64p (1999: 1.63p). The Board recommends a final dividend
of 0.5p per ordinary share making a total dividend for the year of 0.65p
(1999:0.50p). The final dividend is payable on 2 July 2001 to shareholders on
the share register on 17th April 2001.

Trading Review

The results reflect a full year's trading from Haydon and Company Limited,
which was acquired by the Group on 1st September 1999. I am pleased to confirm
that the remaining Haydon business has been profitable on a month by month
basis since both the second half of 2000. Due to the turnaround on this
previously unprofitable business the Group have released the total negative
goodwill to the profit and loss account and all outstanding issues are fully
provided for.

The Group currently has an order book in excess of £100 million and continues
to win profitable long-term contracts.

I am pleased to announce that since the year-end the Group has been awarded a
number of extensions to existing substantial contracts. One of the largest
contracts in the Group is with Wigan Council. The contract value is £3.5
million per annum and has been extended by a further two years to 2003 with a
commitment to enter into a long-term partnership agreement thereafter. A
contract with Basildon District Council for £1.2 million per annum awarded in
1998 for an initial period of three years has been re-awarded for £2.5 million
per annum for five years ending in 2006. Wycombe District Council has awarded
the Group a further contract for £1.3 million giving a total contract value of
around £2.5 million per annum.

During the year the Group has been awarded new long term contracts with Dover
District Council, Burnley and Padiham Housing Association, Warrington Borough
Council, Motability Finance, Serco, Wycombe Council and Croydon Council.



REVIEW OF ACTIVITIES

The Group is structured in such a way that each subsidiary company has its own
individual management team headed by an experienced Managing Director. A
centralised administration unit based in Gloucester provides accounting
services, personnel and health and safety support, to each subsidiary company.

The majority of the Group's business, accounting for £40 million of turnover
in the year, continues to be in the provision of maintenance services to the
Local Authority, social housing and Ministry of Defence housing estate sectors
under the Mears Building Contractors Limited and Mears Building Services
Limited brand names. These sectors provide the Group with long term contracts
with organisations who are unlikely to encounter financial restrictions in any
periods of economic downturn. The Citizens Charter, upon which most tenants
rely, ensures a timely response to tenants' property maintenance needs. These
services are structured on a geographical basis and the two management teams
have contributed significantly to the success of the Group and continue to be
seen as a preferred supplier of such services.

Mears is the largest provider of facility services to the public sector. The
market for such services is estimated at £3.4 billion per annum and growing.
The sector is changing with the advent of clients buying a service based more
upon quality than price. The Government initiative of 'Best Value' procurement
increases the opportunities for the Group as clients look to the larger and
successful providers of such services to work with them on long term
partnership arrangements. The outlook for our primary business has never been
stronger, with contracts being let for longer periods, the normal contract
length now being five years.

As reported last year the acquired business, Haydon and Company Limited was
reorganised to concentrate on its original core business discipline of a
highly respected regional mechanical and electrical services contractor to the
commercial sector. The business, based in the Docklands area of London has had
an excellent first full year in the Group. Haydon provides primarily fast
track mechanical and electrical services to the London refurbishment market,
with an excellent reputation for a quality service. They continue to be
successful in tendering for quality contracts where the standard of competence
is paramount. Turnover of £20 million was achieved, with ongoing contracts and
a forward order book providing a stable and profitable environment to build
the business in the future. The Group's air conditioning installation business
is now included within the Haydon business.

United Fleet Distribution Limited was acquired by the Group in October 1998.
UFD provide vehicle collection and delivery services to the commercial sector
with 'trade plated' drivers who, typically, collect individual vehicles at the
end of their lease period and deliver the vehicles into the retail or vehicle
auction markets. UFD has developed software for the application of hand held
units to transmit vehicle inspection reports. Efficiencies have been realised
in the daily operation of the business, through the provision of data links
direct to clients. UFD holds some of the largest contracts in the UK for these
services and has performed excellently in the year, achieving a turnover of £8
million with significant growth in profitability. The management team deserves
tremendous credit for this performance.



STRATEGY

Mears was listed on the Alternative Investment Market in October 1996 and
since that date the Board have continued to develop the business with
operational branches managed by experienced Managing Directors, with the aim
of developing market leaders in their respective areas. The Board believe in
an environment of high incentivisation based upon profitable performance.
Throughout the Group, from trade operative to administrator to senior manager,
bonus and incentives plans are in place.

Although the Group has, and will continue to have, a success based reward
environment, part of the success of the Group is, I believe, the result of a
commitment to cost and cash control. The Group's central services team support
the thirty strong branch network and, most importantly, work with the
management teams to ensure that work is invoiced, and debts collected at the
earliest opportunity. The Group operates, primarily, in a high volume, low
margin environment and the control of costs and the management of cash are
vital.

The Group has not looked to raise cash for working capital from shareholders
since the original listing in October 1996, which raised an amount of £1.1
million, before listing expenses. In the same period turnover has increased
from around £12 million to £70 million. The working capital to fund that
growth has all, therefore, been generated from within. This ethos of strong
cash control is the foundation upon which the Group has been built and will
continue to be of paramount importance in the future success of the Group. I
applaud all our management teams both junior and senior in providing an
excellent cash management record.

The future strategy for the Group is exciting with all the existing business
areas within which the Group operates, looking to grow significantly.
Currently the Group provides, what are classed as 'blue collar' facility
services. The strategy is to widen the range of services provided and to look
to become a total facility management services provider. The existing public
companies who operate in this sector namely Serco, Capita and MITIE, all have
highly rated stock market valuations and we are seeking to enter this 'Peer
Group' by the continuation of strong organic growth along with strategic
acquisitions. A recent initiative towards improving brand awareness in the
facility management sector and to recruit individuals to join the Group has
been successful. I hope to announce in the half-year statement that the Group
has acquired and or launched a facility management company.

The Board is considering a number of acquisition opportunities but will only
acquire where it believes that the incoming management team are committed to
build the business for the future. Dependent upon the size of an acquisition,
shareholders may be asked to participate in a fund raising if required. The
prudent due diligence before acquisition and consideration to cash management
of these businesses thereafter will continue.

During the year the Group continued to increase the awareness of the investing
public at large. The Group was represented at a series of Investor Relations
exhibitions, where both existing and potential investors welcomed the
opportunity to meet the management team and used the time to improve their
understanding of Mears. A number of exhibitions are planned in the current
year where the Group will be present. The company's website at
www.mearsgroup.co.uk continues to be a source of information for all and is
supported by an in house newsletter which is circulated to around five
thousand people on a quarterly basis. Details of all future exhibitions are
included on the website and I would encourage shareholders or friends of Mears
to use the opportunity to meet the management team at one of the regional
investor relations exhibitions. In the year the total number of shareholders
trebled to around 2,300.

During the year the Group changed its stockbroker appointing Old Mutual
Securities in place of Fiske plc. I would like to thank Clive Harrison and his
team at Fiske, who served the Group well, in it's formative days as a public
company.

At the Group's Annual General Meeting to be held in London the Directors of
all the subsidiary companies will be in attendance.

During the year the Group was re-awarded the prestigious Investor in People
award until 2003 and is committed to extending the existing ISO 9002 Quality
Management System to all Group companies. The Group provided more training
days per employee in the year than ever before. During the year a survey was
carried out of all employees to ascertain their views of the Group, their role
within it and their view on the level of customer service. The survey found
that 89% of employees were mainly very positive about working for the Group
but highlighted certain issues regarding internal communications. The points
raised have been dealt with and we intend to hold a survey on an annual basis.

The environmental recycling projects continue to reduce the costs of both
waste disposal and paper usage. The raising of environmental awareness to all
employees is seen as only a small commitment to what is a significant issue,
but is also a further step in our aim of being recognised as a socially
responsible Group.

The Board is mindful of the excellent support received from the Group's
suppliers and customers. The success of the Group is a reflection of the
commitment and ability of staff at all levels.

The Board remains optimistic about the future.

I look forward to being able to report another excellent year of progress in
twelve months time.





R HOLT

CHAIRMAN

3 April 2001



Consolidated Profit and Loss Account

For the year ended 31 December 2000
                                 2000        2000          1999           1999

                                    £           £             £              £

Turnover
Continuing operations      66,944,602                43,407,697
Discontinued operations     3,735,584                 4,048,257

                          -----------                ----------
                                       70,680,186                   47,455,954
Cost of sales                         (55,108,694)                 (37,855,760)

                                      ------------                 ------------
Gross profit
Continuing operations      15,837,505                 9,196,926
Discontinued operations     (266,013)                   403,268

                          -----------                ----------
                                       15,571,492                    9,600,194
Administrative expenses               (14,897,151)                  (9,952,116)
Exceptional item                        1,558,356                    1,580,804
Operating profit
Continuing operations       2,232,697                 1,228,882
Discontinued operations             -                         -

                          -----------                ----------
                                        2,232,697                    1,228,882
Net interest                            (304,218)                    (159,842)

                                      -----------                  -----------
Profit on ordinary
activities
before taxation                         1,928,479                    1,069,040
Tax on profit on ordinary               (139,654)                    (190,926)
activities
                                      -----------                  ------------
Profit on ordinary
activities
after taxation                          1,788,825                      878,114
Equity minority interests                 (6,749)                       19,104

                                      -----------                  ------------

Profit for the financial                1,782,076                      897,218
year
Dividends                               (345,448)                    (256,194)

                                      -----------                  ------------
Profit retained                         1,436,628                      641,024

                                        =========                    =========

Earnings per share
Basic                                       3.50p                        1.90p

                                        =========                    =========

Diluted earnings per                        3.20p                        1.70p
share
                                        =========                    =========

There were no recognised gains or losses other than the profit for the
financial year.



Consolidated Balance Sheet

For the year ended 31 December 2000
                                   2000         2000          1999         1999

                                      £            £             £            £

Fixed assets
Intangible assets -           2,193,119                  2,315,874
positive goodwill
Intangible assets -                   -                (1,558,356)
negative goodwill
Tangible assets               1,060,302                  1,017,702
Investments                      55,677                         19

                           ------------                -----------
                                           3,309,098                  1,775,239

Current assets
Stocks                        1,737,153                  3,282,137
Debtors                      16,192,676                 18,325,307
Cash at bank and in hand      3,596,623                  2,878,176

                           ------------                -----------
                             21,526,452                 24,485,620
Creditors: amounts falling
due
within one year            (19,406,859)               (22,157,142)

                           ------------               ------------

Net current assets                         2,119,593                  2,328,478

                                          ----------                 ----------

Total assets less current                  5,428,691                  4,103,717
liabilities

Creditors: amounts falling
due
after more than one year                   (400,000)                  (600,000)

Provisions for liabilities
and
charges                                      (6,500)                    (6,500)

                                         ------------                ----------
                                           5,022,191                  3,497,217

                                           =========                  =========

Capital and reserves
Called up share capital                      525,152                    471,363
Share premium account                      2,163,151                  2,135,343
Other reserve                              (249,898)                  (249,898)
Profit and loss account                    2,613,704                  1,177,076

                                        ------------                -----------

Equity shareholders' funds                 5,052,109                  3,533,884
Equity minority interests                   (29,918)                   (36,667)

                                        ------------                -----------
                                           5,022,191                  3,497,217

                                           =========                  =========



Consolidated Cash Flow Statement

For the year ended 31 December 2000



                                                             2000          1999

                                                                £             £

Net cash inflow from operating activities               2,483,465     1,488,070

Returns on investments and servicing of finance
Interest received                                           2,237           995
Interest paid                                           (323,816)     (140,268)
Finance lease and hire purchase interest paid               (459)       (2,789)

                                                     ------------  ------------
Net cash outflow from returns on investments and        (322,038)     (142,062)
servicing of finance
                                                     ------------  ------------


Taxation paid                                           (266,635)     (279,181)

Capital expenditure
Purchase of intangible fixed assets                             -     (338,495)
Purchase of tangible fixed assets                       (405,817)     (471,469)
Sale of tangible fixed assets                              67,392        19,695
Purchase of investment                                   (55,658)          (19)

                                                     ------------  ------------
Net cash outflow from capital expenditure               (394,083)     (790,288)

                                                     ------------  ------------

Acquisitions
Purchase of subsidiary undertakings                     (771,110)     (576,409)
Net cash acquired with subsidiary undertakings                  -         7,684

                                                     ------------  -------------
Net cash outflow from acquisitions                      (771,110)     (568,725)

                                                     ------------  -------------

Equity dividends paid                                   (287,455)     (188,545)

Financing
Issue of shares                                            81,597             -
Repayment of borrowings                                 (200,000)     (200,000)
Receipts from borrowings                                        -       500,000
Capital element of finance leases and hire purchase      (19,956)      (14,955)
rentals
                                                     ------------  ------------
Net cash (outflow)/inflow from financing                (138,359)       285,045

                                                     ------------  ------------

Increase/(decrease) in cash                               303,785     (195,686)

                                                       ==========     =========



Notes

1     EARNINGS PER SHARE


             The calculation of the basic earnings per share is based on the
        earnings attributable to the ordinary shareholders divided by the
        weighted average number of shares in issue during the year.      The
        calculation of the diluted earnings per share is based on the basic
        earnings per share, adjusted to allow for the issue of shares on the
        assumed conversion of all dilutive options and other dilutive
        potential ordinary shares.

             Reconciliation of the earnings and weighted average number of
        shares used in the calculations are set out below.

                              2000                           1999
                            Weighted Per share               Weighted Per share
                                        amount                average    amount
                   Earnings  average     pence Earnings     number of     pence
                                                               shares
                          £   number                  £
                                  of
                              shares

Basic earnings per
share
Profit            1,782,076  50,962,979     3.50p  897,218    47,136,365   1.90p
attributable to
ordinary
shareholders

Dilutive effect of

Securities
Options                    -  4,768,187                  -     5,496,767

Diluted earnings   --------- ---------     ------  -------    ---------- 
------per share
Adjusted earnings  1,782,076 55,731,166     3.20p  897,218    52,633,132   1.70p

                   ========= ==========   =======  =======    ==========  ======


2     Net cash INFLOW from operating activities
                                                         2000              1999

                                                            £                 £

Operating profit                                    2,232,697         1,228,882
Depreciation and amortisation                     (1,128,370)       (1,286,947)
(Profit)/loss on disposal of fixed                   (11,406)             9,881
assets
Decrease/(increase) in stocks                       1,544,984       (2,265,943)
Decrease/(increase) in debtors                      2,132,631       (2,296,213)
(Decrease)/increase in creditors                  (2,287,071)         6,098,410

                                                  -----------       -----------
Net cash inflow from operating                      2,483,465         1,488,070
activities
                                                  ===========         =========

3     RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
                                                            2000           1999

                                                               £              £

Increase/(decrease) in cash in the year                  303,785      (195,686)
Cash outflow/(inflow) from financing                     200,000      (300,000)
Cash outflow from finance leases and hire                 19,956         14,955
purchase contracts
                                                  --------------   ------------
Change in net funds resulting from cash flows            523,741      (480,731)
Net funds at 1 January 2000                          (1,132,135)      (651,404)

                                                  --------------  -------------
Net debt at 31 December 2000                           (608,394)    (1,132,135)

                                                       =========     ==========

4     ANALYSIS OF CHANGES IN NET DEBT
                                                At          Cash             At

                                         1 January          Flow    31 December

                                              2000             £           2000

                                                 £                            £

Cash at bank and in hand                 2,878,176       718,447      3,596,623
Overdrafts                             (2,690,315)     (414,662)    (3,104,977)

                                  -----------------  ------------  -------------
                                           187,861       303,785        491,646
Debt                                   (1,300,040)       200,000    (1,100,040)
Finance leases and hire purchase          (19,956)        19,956              -
contracts
                                  ----------------- -------------  -------------
                                       (1,132,135)       523,741      (608,394)

                                       ===========     =========     ==========