Interim Results

NWF Group PLC
31 January 2005


Embargoed until 07.00, Monday 31 January 2005


                          NWF GROUP PLC INTERIM RESULTS
                    FOR THE SIX MONTHS ENDED 30 NOVEMBER 2004

NWF Group plc ('NWF'), the diversified sales and distribution business, today
announces interim results for the six months ended 30 November 2004.

Commenting on the results, Roy Willis, Chairman said: 'The six months ended 30
November 2004 have been very busy for the Group with several developments taking
place which will serve us well in future years. The Board has again pursued its
progressive dividend policy by approving an interim dividend of 4.3p per share
(2003: 4.2p), which will be paid on 2 May 2005 to shareholders on the register
on 1 April 2005. The shares will trade ex-dividend on 30 March 2005.'

Financial highlights (comparative figures for six months to 30 November 2003):

   •Turnover increased by 22% to £108.6m (2003: £89.3m)
   •Profit before tax and exceptional item £1.3m (2003: 1.5m)
   •Basic earnings per share, before exceptional item, 10.6p (2003: 13.2p)
   •Interim dividend 4.3p (2003: 4.2p)

Divisional highlights

   •Distribution - 19,000 pallet warehouse at Deeside, Chester now fully
    utilised benefiting from new contract with Patak's Food
   •Feeds increased its market share with volumes of 137,000 tonnes in a
    reduced market, improved margins and successfully acquired JGW Thomas & Son,
    feed manufacturer in Umberleigh, Devon
   •Fuels increased volumes by 12% with all depots contributing to this
    performance
   •Garden Centres (previously Retail) suffered from poor summer weather and
    a late start to Christmas; completed the disposal of its six Country Stores
    and acquired Victoria Garden Centre in Yorkshire

On the outlook for the coming months Roy Willis added: 'The Board remains
confident about prospects for the second half year when the majority of the
Group's profit is normally earned and looks forward to the full benefits of the
various actions we have taken, in future years.'

For further information please visit www.nwf.co.uk or contact:

Graham Scott, Chief Executive               John West
Paul Grundy, Finance Director               Claire Melly
NWF Group plc                               Tavistock Communications
Tel: [phone]                           Tel: [phone]



                                 NWF Group plc

                             Interim Report 2004/05

                              Chairman's statement


For the six months ended 30 November 2004

I am pleased to report NWF Group's interim results for the six months ended 30
November 2004. This has been a very busy half year for the Group with several
developments taking place which will serve us well in future years. During the
period, the Group acquired Victoria Garden Centre based in Yorkshire, disposed
of its six Country Stores and leased a new warehouse near Chester. Additionally,
in December 2004, the Group acquired JGW Thomas & Son Limited, a feed
manufacturer based in Devon.

For the six months to 30 November 2004, operating profit was £1,619,000 (2003:
£1,749,000) on turnover up by 22% to £109 million (2003: £89 million). In
addition, the Group incurred an exceptional loss of £330,000 (2003: £nil) on the
disposal of the Country Stores, after writing off goodwill amounting to £780,000
which had previously been transferred directly to reserves. Excluding this
exceptional loss, profit before taxation was £1,293,000 and basic earnings per
share were 10.6 pence; including the exceptional loss these figures become
£963,000 (2003: £1,521,000) and 6.7 pence (2003: 13.2 pence) respectively.

The Board has again pursued its progressive dividend policy by approving an
interim dividend of 4.3p per share (2003: 4.2p) which will be paid on 2 May 2005
to shareholders on the register on 1 April 2005. The shares will trade
ex-dividend on 30 March 2005.

The Distribution business saw operating profit fall from £811,000 to £664,000 on
increased turnover of £11m (2003: £8m). The reason for this lay partly in the
one-off start-up costs associated with taking on the lease of a 19,000 pallet
warehouse at Deeside, just outside Chester. This warehouse is now fully utilised
with the recently announced contract with Patak's Food Limited accounting for
most of this volume in conjunction with HP Foods. We will shortly review our
medium term strategy for the location of distribution sites, having recently
been granted planning permission to build additional warehouses at Wardle.

Feeds increased its market share yet again by maintaining volume at around
137,000 tonnes in a reduced market. Margins recovered from last year with lower
raw material prices and improved efficiencies leading to a higher operating
profit of £649,000 (2003: £253,000). The installation of the blends lines at
Wardle and at Kirkbride were completed as was the construction of extra storage
bins at the Wardle mill. In December, we announced the acquisition of JGW Thomas
& Son Ltd, an animal feed manufacturer based in Umberleigh, Devon. This move
gives us comprehensive access to the major dairy farming areas from Central
Scotland to Cornwall.

Fuels had to contend with abnormally high product prices and poor margins early
in the half year but this situation improved in the later months. Fuel is still
trading at historically high prices. Volumes were 12% higher than in 2003,
particularly on road fuel with heating oil demand flat in a mild Autumn.
Operating profit was an excellent £761,000 (2003: £644,000) given the difficult
market conditions. All depots contributed well to this performance, including
those from our most recent acquisition at Nottingham and Birmingham.

In the three Garden Centres which we operated throughout the period, local
contributions were markedly down on last year because of poor summer weather and
a late start to Christmas. The result for the whole division, named Retail in
previous periods, was further reduced by the costs of exiting our Country Stores
and the overall operating loss was £455,000 (2003: £41,000 profit). This
includes some £140,000 of margin losses and other costs incurred in the run-up
to closing the Isle of Man store in September. In November, we completed the
sale of our five remaining Country Stores resulting in an overall exceptional
loss before taxation of £330,000 on exiting this sector, after recognising the
non-cash write-down of historic goodwill acquired several years ago. At the same
time, we announced the acquisition of Victoria Garden Centre, a major site in
Yorkshire, with annual sales in excess of £4m. These moves underline our
strategy of focusing our retail business exclusively on large garden centres.

I am delighted that Graham Scott has agreed to remain as Chief Executive until
at least the end of 2006. Alan Fulker, Finance Director for 15 years, retired in
August with our gratitude for his lengthy period of excellent stewardship of the
Group's finances. As announced earlier in the year, Paul Grundy became Finance
Director on 1 September 2004. Mike Guest left the company in November with our
thanks for his success in building our Distribution business.

The Board remains confident about prospects for the second half year when the
majority of the Group's profit is normally earned and looks forward to the full
benefits of the various actions described above in future years.



Roy Willis
Chairman
31 January 2005



Group profit and loss account
Half year to 30 November 2004

                                     Unaudited       Unaudited         Audited
                                  Half year to    Half year to         Year to
                                   30 Nov 2004     30 Nov 2003     31 May 2004
                                   -----------     -----------      ----------
                                         £'000           £'000           £'000
Turnover                               108,565          89,279         198,770
Operating costs                       (106,946)        (87,530)       (193,055)
                                   ------------    -----------      ----------
Operating profit                         1,619           1,749           5,715
                                   ------------
Exceptional item - loss on
  disposal of operation:
 Surplus over net
 tangible assets                           450               -               -
 Less: goodwill 
 previously written off                   (780)              -               -
                                    -----------
                                          (330)              -               -
                                    -----------
Interest payable                          (326)           (228)           (546)
                                    -----------     -----------     -----------

Profit on ordinary
activities before taxation                 963           1,521           5,169
Taxation                                  (429)           (472)         (1,740)
                                    -----------     -----------     -----------

Profit after taxation                      534           1,049           3,429
Equity dividends payable                  (342)           (334)         (1,298)
                                    -----------     -----------      ----------
Profit transferred to reserves             192             715           2,131
                                    -----------     -----------      ----------

Earnings per share (see note 1)
 Basic before exceptional
 item                                     10.6p           13.2p           43.1p
 Basic                                     6.7p           13.2p           43.1p
 Diluted                                   6.5p           12.9p           42.0p

Dividends per share                        4.3p            4.2p           16.3p



Summarised group balance sheet
At 30 November 2004

                                     Unaudited       Unaudited         Audited
                                   30 Nov 2004     30 Nov 2003     31 May 2004
                                   ------------    -----------     ------------
                                         £'000           £'000           £'000
Intangible assets                        5,187           3,443           3,348
Tangible assets                         22,483          19,377          18,610
Stocks                                   5,708           5,846           5,899
Debtors                                 28,745          22,463          22,516
Cash and bank balances                      36              26              25
Creditors: amounts
  falling due within one
  year                                 (31,637)        (27,396)        (25,696)
                                    ------------    -----------     -----------

Total assets less
  current liabilities                   30,522          23,759          24,702
Creditors: amounts
  falling due after more
  than one year                         (9,157)         (4,913)         (4,353)
Provision for
  liabilities and charges                 (950)           (819)           (906)
                                    -----------      -----------    -----------
Net assets                              20,415          18,027          19,443
                                    -----------      -----------    -----------
Total equity shareholders' 
  funds                                 20,415          18,027          19,443
                                    -----------      -----------    -----------



Reconciliation of movements in equity shareholders' funds
Half year to 30 November 2004

                                     Unaudited       Unaudited         Audited
                                  Half year to    Half year to         Year to
                                   30 Nov 2004     30 Nov 2003     31 May 2004
                                   ------------   -------------    ------------
                                         £'000           £'000           £'000
Profit after taxation                      534           1,049           3,429
Dividends                                 (342)           (334)         (1,298)
Share capital issued
  including premium                          -               1               1
Goodwill resurrected on
  disposal of operation                    780               -               -
                                   ------------    -------------    -----------

Net addition to equity
  shareholders' funds                      972             716           2,132
Opening equity
  shareholders' funds                   19,443          17,311          17,311
                                   ------------    -------------    -----------
Closing equity
  shareholders' funds                   20,415          18,027          19,443
                                   ------------    -------------    -----------



Summarised group cash flow statement
Half year to 30 November 2004

                                     Unaudited       Unaudited         Audited
                                  Half year to    Half year to         Year to
                                   30 Nov 2004     30 Nov 2003     31 May 2004
                                  ------------    ------------     ------------
                                         £'000           £'000           £'000
Operating profit                         1,619           1,749           5,715
Goodwill amortisation                       91              81             175
Depreciation                             1,210           1,095           2,260
(Increase)/decrease in
  working capital                       (3,033)         (1,228)             49
Other                                      (48)            (15)           (103)
                                  -------------    ------------    ------------

Operating cash
  (outflow)/inflow                        (161)          1,682           8,096
Interest                                  (357)           (226)           (520)
Taxation                                  (834)         (1,036)         (1,949)
Equity dividends                          (963)           (860)         (1,195)
Purchase of tangible
  fixed assets                          (2,012)         (2,741)         (3,183)
Sale of tangible fixed
  assets                                    72               5             139
Acquisitions including
  bank overdraft acquired               (3,061)           (926)           (925)
Disposals of businesses                  1,258               -               -
Deferred acquisition
  payments                                (400)           (509)           (509)
                                   ------------     -----------     -----------

Net cash (outflow)/inflow 
  before financing                      (6,458)         (4,611)            (46)
Term loan and HP finance
  movements                               (529)           (512)         (1,052)
Medium term loan
  received                               3,000           1,400           1,400
Issue of ordinary share
  capital                                    -               1               1
                                   -------------    ------------    -----------
(Decrease)/increase in
  cash in the period                    (3,987)         (3,722)            303
                                   -------------    ------------    -----------


Reconciliation of net cash flow to movement in net debt
Half year to 30 November 2004

                                     Unaudited       Unaudited         Audited
                                  Half year to    Half year to         Year to
                                   30 Nov 2004     30 Nov 2003     31 May 2004
                                  -------------    -----------     ------------
                                         £'000           £'000           £'000
(Decrease)/increase in
  cash per cash flow
  statement                             (3,987)         (3,722)            303
Cash (inflow) from
  (increase) in HP and
  debt financing                        (2,471)           (888)           (348)
                                  -------------    -------------   ------------
Change in net debt
  resulting from cash
  flows                                 (6,458)         (4,610)            (45)
HP and lease finance
  acquired with
  acquisition                                -            (174)           (174)
Net debt brought forward                (8,119)         (7,900)         (7,900)
                                  --------------   --------------  ------------

Net debt carried forward               (14,577)        (12,684)         (8,119)
                                  --------------   --------------  ------------

Analysis of net debt:

Cash and bank balances                      36              26              25
Overdrafts                              (6,679)         (6,707)         (2,681)
HP and lease finance due
  within one year                          (45)            (45)            (45)
Debt due within one year                  (787)         (1,045)         (1,065)
HP and lease finance due
  after one year                          (102)           (126)           (103)
Debt due after one year                 (7,000)         (4,787)         (4,250)
                                   ------------     -------------  ------------
                                       (14,577)        (12,684)         (8,119)
                                   ------------     -------------  ------------



Segmental analysis
Half year to 30 November 2004

                                     Unaudited       Unaudited         Audited
                                  Half year to    Half year to         Year to
                                   30 Nov 2004     30 Nov 2003     31 May 2004
                                  ------------     -----------     -----------
                                         £'000           £'000           £'000
Turnover

Distribution                            10,998           8,108          16,683
Feeds                                   22,036          20,850          49,837
Fuels                                   68,179          52,582         114,969
Garden centres
  (including Country
  Stores)                                7,352           7,739          17,281
                                  ------------     -----------      -----------
                                       108,565          89,279         198,770
                                  -------------    -----------      -----------

Operating profit

Distribution                               664             811           1,586
Feeds                                      649             253           1,278
Fuels                                      761             644           2,066
Garden centres
(including Country
Stores)                                   (455)             41             785
                                  -------------    ------------     -----------
                                         1,619           1,749           5,715
                                  -------------    ------------     -----------

Net operating assets

Distribution                            11,289          10,384           9,803
Feeds                                    9,076           9,146           8,690
Fuels                                    5,371           3,839           3,933
Garden centres
  (including Country
  Stores)                                7,721           5,919           4,789
                                  -------------    ------------     -----------
                                        33,457          29,288          27,215
                                  -------------    ------------     -----------


Notes:

1.      The calculations of basic earnings per share for the half year are based
        on profit after taxation before exceptional item of £843,000 
        (2003: £1,049,000), on profit after taxation after exceptional item of 
        £534,000 (2003: £1,049,000) and on 7,961,123 (2003: 7,960,278) ordinary 
        shares representing the weighted average number of shares in issue 
        during the period.

        The calculation of the diluted earnings per share for the half year 
        is based on the figures shown above amended for the weighted average 
        dilutive effect (241,322 shares) of share options outstanding through 
        the period (2003:196,660).

2.      The Group acquired the trade and certain assets of Victoria Garden
        Centre on 2 November 2004 for a consideration of £6.1 million, of which 
        £3.2 million is deferred and payable in equal instalments over the next 
        three years. The book value of net assets acquired amounted to 
        £4.2 million, resulting in goodwill of £1.9 million. The results for 
        the period since acquisition are not material.

3.      The Group closed its Country Store located on the Isle of Man on 30
        September 2004 and disposed of the trade and certain assets of its UK 
        Country Stores on 1 November 2004.

4.      The comparative figures for the year to 31 May 2004 are an abridged
        version of the accounts filed with the Registrar of Companies on which 
        an unqualified audit opinion has been given.

5.      The above statements have been prepared on the basis of accounting
        policies set out in the 2004 Annual Report and Accounts.


2005 Financial calendar

Interim dividend paid                                            2 May 2005
Financial year end                                              31 May 2005
Preliminary announcement of full year results                   August 2005
Publication of Annual Report and Accounts                    September 2005
Annual General Meeting                                    30 September 2005
Final dividend paid                                         1 November 2005


Copies of the Interim Report will be sent to shareholders on Friday 4 February
2005. Further copies can be obtained from the Company Secretary at NWF Group
plc, Wardle, Nantwich, Cheshire, CW5 6BP.





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