Interim Results

Personal Group Holdings PLC
23 September 2002


23 September 2002

Enquiries:

Christopher Johnston, Chief Executive

Personal Group Holdings Plc                         01908 605000 ext. 235

Barrie Newton, Director
Rowan Dartington & Co. Limited                      0117 933 0020 

Simon Rothschild/Trevor Phillips
Holborn                                             020 7929 5599


                         Personal Group Holdings Plc

           Interim Statement for the six months to 30 June 2002


Personal Group Holdings Plc providers of employee benefits and related business,
are pleased to announce the Group's interim results as follows:

                                   HIGHLIGHTS

                                                                            2002       2001            %
                                                                              £m         £m

Underwriting income*                                                        5.97       5.34        Up 12
Pre-tax profit                                                              2.65       2.12        Up 25
Earnings per share                                                          5.9p       4.6p        Up 28
First interim dividend per share                                            1.8p      1.65p         Up 9


*comprising premiums earned net of non-financial reinsurance by Personal
Assurance Plc


•    Other income excluding discontinued activities (comprising fees and
     commission arising from other services) rose by 44%

•    Major employee programmes launched for Eaton Automotive, Lloyds Pharmacy,
     Saffrey Champness and JMP Consultants during the period

•    Further employee programmes launched for GAP, Tetley and United Biscuits
     in July. Strong pipeline of further launches planned for the next six 
     months


Christopher Johnston, Chief Executive commented:

'The Group has delivered another solid set of results during the period by
further development of our market niche. We continue to pursue organic growth by
concentrating on our core business and through further investment in our people
and systems. I am confident we will continue to grow the business.'


CHAIRMAN'S STATEMENT

I am pleased to report that the Group has produced another profitable period.
During the first half of 2002 our profit before tax increased by £528,000 to
£2,648,000 reflecting the continuing strength of our underlying business.
Earnings per share were up 28 per cent. to 5.9p.

In view of this successful period of trading, the directors have declared a
first interim dividend of 1.8p per share, an increase of 9 per cent., payable on
30 October 2002 to shareholders on the register at the close of business on 4
October 2002. Shares will be marked ex-dividend on 2 October 2002. The Group's
announcement to the London Stock Exchange dated 27 February 2002 stated 'On the
assumption that the existing strong solvency position of the Group is maintained
the directors anticipate that they will adopt the policy of three dividend
payments a year for the foreseeable future'. The directors confirm that they
expect to continue this policy.

After provision for taxation and dividends, there is a surplus for the period of
£1,238,000 (2001: £878,000), which has been added to reserves. Shareholders'
funds now stand at a total of £13,557,000 (44p per share) and include net cash
balances of approximately £5,066,000 in addition to £4,227,000 of Treasury loan
stock. The decrease in the cash balances at 30 June 2002, compared to the
corresponding period last year, reflect the introduction of the three dividends
per year policy referred to above.

New benefit programmes were launched during the period, among others, for
Wolseley Centres, Barklands, Lloyds Pharmacy, Eaton Automotive, Saffrey
Champness and JMP Consultants. Since 30 June 2002 further programmes have been
launched for United Biscuits, GAP and Tetley. Further launches are planned for
the coming months. The Group has expanded the number of staff in order to
successfully manage this planned growth.

Following consistently favourable underwriting results, Personal Assurance Plc
(the Group's insurance company) terminated its quota share financial reinsurance
treaty at a cost of £100,000. This amount has been charged in full to the profit
and loss account. The usual charge for a six-month period was approximately
£15,000.

During the period net unrealised investment losses of £63,000 (2001: £233,000)
have been recorded, reflecting the continuing downward trend of the UK stock
markets. As at the close of business on 20 September 2002 further unrealised
investment losses of £127,000 have been recorded reducing the value of the
quoted equity investments to £361,000.

As reported in its annual return to the Financial Services Authority for the
year ended 31 December 2001 Personal Assurance Plc had net admissible assets of
£7,404,000 with a required minimum margin of £1,872,000 making a £5,532,000
surplus over the required minimum. Although the equity investments are held by
the insurance company, further decreases in the value of the equity portfolio
would not have a significant impact on that company's solvency margin
requirement, since equity investments now represent less than 5 per cent. of
that company's total assets.

The Group's unsecured loan to a firm of unquoted insurance brokers based in
Paris has been partly converted into equity shares resulting in an investment
write back of approximately £54,000. The balance of the loan was repaid in cash.
The Group now owns 19.9% of the company. The company is profitable, and the
outlook for the future looks encouraging.

A lease for the surplus space on the second floor of John Ormond House was
finalised during the period, with a rental income of approximately £112,000 per
annum commencing in May 2002.

The Group has entered the second half of the year in good shape. The balance
sheet continues to be strong, and the business continues to record good organic
growth in its core operations. Current trading is in line with directors'
expectations.

The board has recently decided that all directors of the Group should retire by
the age of 70. Accordingly both Karl-Heinz Klaeser and I (both being
non-executive directors) will retire at or before the next Annual General
Meeting in April 2003.

I am pleased to report that since 30 June 2002 Roger Green and Chris Curling
have joined the board as non-executive directors. Roger Green was formerly
finance director of Bodycote International Plc and Chris Curling is currently
senior partner of Osborne Clarke.

Our continuing success is wholly due to the excellent service delivered by the
people of Personal Group, to whom once more, on behalf of all shareholders, I
convey my thanks.

John Swarbrick, Chairman
23 September 2002


CONSOLIDATED PROFIT AND LOSS ACCOUNT

for the 6 month period ended 30 June 2002


                                                         6 Months                  6 Months                  12 Months
                                                    ended 30/6/02             ended 30/6/01             ended 31/12/01
                                                   £000      £000            £000      £000             £000      £000
  TECHNICAL ACCOUNT - GENERAL BUSINESS                                                                                

  Gross premium written                                     6,012                     5,415                     11,067
  Reinsurance premiums                                          -                         -                        (1)

  Net premiums written                                      6,012                     5,415                     11,066

  Change in the gross provision for                          (39)                      (70)                         14
  unearned premiums                                                                                                   

  Earned premiums, net of reinsurance                       5,973                     5,345                     11,080

  Claims paid                                                                                                         
  Gross amount                                  (1,290)                   (1,231)                    (2,444)          
  Reinsurers' share                                   -                         -                          -          

  Net of reinsurance                            (1,290)                   (1,231)                    (2,444)          

  Change in the provision for claims                                                                                  
  Gross amount                                        4                      (44)                         70          
  Reinsurers' share                                   -                         -                          -          

  Net of reinsurance                                  4                      (44)                         70          

  Claims incurred, net of reinsurance                     (1,286)                   (1,275)                    (2,374)

  Net operating expenses:                                                                                             

  Financial reinsurance costs                     (129)                      (27)                       (31)          
  Other                                         (2,644)                   (2,469)                    (4,894)          
                                                          (2,773)                   (2,496)                    (4,925)
  Balance on the technical account for                      1,914                     1,574                      3,781
  general business                                                                                                    




CONSOLIDATED PROFIT AND LOSS ACCOUNT (CONTINUED) 

for the 6 month period ended 30 June 2002 

                                                      6 months                  6 Months                    12 Months 
                                                 ended 30/6/02             ended 30/6/01               ended 31/12/01 
                               Note            £000       £000             £000     £000              £000       £000 
  NON-TECHNICAL ACCOUNT                                                                                               

  Balance on the general                                 1,914                     1,574                        3,781 
  business technical                                                                                                  
  account                                                                                                             

  Investment income                             259                         312                        533            
  Unrealised losses on                         (63)                       (233)                      (139)            
  investments                                                                                                         
  Investment expenses and                      (34)                       (199)                      (488)            
  charges                                                                                                             

  Net investment return                                    162                     (120)                         (94) 

  Other income                                                                                                        
  - normal                                    1,727                       1,370                      2,830            
  - exceptional                                   -                         224                        426            
                                                         1,727                     1,594                        3,256 
  Other charges                                                                                                       
  - normal                                             (1,125)                     (901)                      (2,232) 

  Charitable donations                                    (30)                      (27)                         (65) 

  Profit on ordinary                                     2,648                     2,120                        4,646 
  activities before tax                                                                                               

  Tax on profit on ordinary      1                       (870)                     (747)                      (1,457) 
  activities                                                                                                          

  Profit for the period                                  1,778                     1,373                        3,189 

  Dividends                      2                       (540)                     (495)                      (2,101) 

  Profits retained                                       1,238                       878                        1,088 

  Earnings per share                                                                                                  
  Basic & diluted                3                        5.9p                      4.6p                        10.6p 


There are no recognised gains or losses for the period other than the profit for 
the financial period.



CONSOLIDATED BALANCE SHEET 
                                                                                                                        
                                                        6 Months                 6 Months                 12 Months
                                                      ended 30/6/02            ended 30/6/01            ended 31/12/01
                                                      £000     £000            £000     £000             £000     £000
  Assets                                                                                                              

  Investments                                                                                                         

  Other financial investments                                 4,819                    2,377                     4,869

  Debtors                                                                                                             

  Debtors arising out of direct insurance            1,172                    1,011                     1,162         
  operations                                                                                                          
  Debtors arising out of direct                          -                       31                        29         
  reinsurance operations                                                                                              
  Other debtors due within one year                    741                      311                       405         
                                                              1,913                    1,353                     1,596
  Other assets                                                                                                        

  Tangible assets                                    6,006                    6,357                     6,111         
  Cash at bank and in hand                           5,066                    6,210                     4,512         
  Investment in own shares                             402                      402                       402         
                                                             11,474                   12,969                    11,025
  Prepayments and accrued income                                                                                      

  Accrued interest and rent                             31                       15                        21         
  Deferred acquisition costs                            46                       48                        46         
  Other prepayments and accrued income                  46                      131                        29         
                                                                123                      194                        96

  Total assets                                               18,329                   16,893                    17,586




CONSOLIDATED BALANCE SHEET (CONTINUED) 

                                                                                                                      
                                                           6 Months                 6 Months                 12 Months
                                                      ended 30/6/02            ended 30/6/01            ended 31/12/01
                                                      £000     £000            £000     £000             £000     £000
  Liabilities                                                                                                         

  Capital and reserves                                                                                                

  Called up share capital                            1,528                    1,528                     1,528         
  Profit and loss account                           12,029                   10,581                    10,791         

  Equity shareholders' funds                                 13,557                   12,109                    12,319

  Technical provisions                                                                                                

  Provision for unearned premiums                      344                      389                       305         

  Claims outstanding                                   816                      935                       821         
                                                              1,160                    1,324                     1,126
  Provision for other risks and charges                         238                      343                        60
  Creditors                                                                                                           

  Arising out of reinsurance operations                100                       25                        14         
  Current taxation                                     988                    1,172                       877         
  Other creditors including other                      500                      452                       421         
  taxation and social security                                                                                        
  Bank loan                                            338                      393                       384         
  Proposed dividend                                    540                      495                     1,606         
                                                              2,466                    2,537                     3,302


  Accruals and deferred income                                  908                      580                       779

  Total liabilities                                          18,329                   16,893                    17,586




CONSOLIDATED CASH FLOW STATEMENT 

for the 6 month period ended 30 June 2002 

                                                                                                                      
                                                          6 Months                 6 Months                  12 Months
                                                     ended 30/6/02            ended 30/6/01             ended 31/12/01
                                                                                 (restated)                 (restated)
                                                    £000      £000             £000    £000             £000      £000
  Net cash inflow from operating                             2,850                    1,739                      4,238
  activities                                                                                                          

  Taxation paid                                              (581)                    (598)                    (1,606)

  Capital expenditure                                                                                                 
  Purchase of fixed assets                         (139)                      (580)                    (721)          
  Sale of fixed assets                                64                         19                      144          
                                                              (75)                    (561)                      (577)
  Acquisitions and disposals                                                                                          
  Disposal of trade and goodwill                                 -                      318                        318

  Equity dividends paid                                    (1,606)                    (495)                      (990)

  Financing                                                                                                           
  Repayment of loan                                           (46)                     (24)                       (33)

  Net cash flows                                               542                      379                      1,350

  Cash flows were invested as follows:                                                                                

  Increase/(decrease) in cash holdings                         554                    1,284                      (414)

  Net portfolio investment                                                                                            
  Ordinary shares, loans, finance                             (12)                    (905)                      1,764
  leases, treasury loan stock                                                                                         

  Net investment of cash flows                                 542                      379                      1,350


Notes


1.   Taxation comprises United Kingdom corporation tax of £692,000 (30/6/01:
     £772,000, 31/12/01: £1,457,000), and deferred taxation charge of £178,000 
     (30/6/01: £25,000 credit, 31/12/01: £nil).

2.   The directors have declared a dividend of 1.8p (30/6/01: 1.65p, 
     31/12/01: 7p) per share payable on 30 October 2002 to shareholders on the 
     register at the close of business on 4 October 2002. Shares will be marked 
     ex-dividend on 2 October 2002.

3.   The calculations of basic and diluted earnings per share are based on the 
     following:

                                        30/06/02        30/06/01        31/12/01


Earnings - basic and diluted          £1,778,000      £1,373,000      £3,189,000

Weighted average number of shares                                        
                                                 
Basic                                 30,014,943      30,014,943      30,014,943

Diluted                               30,129,691      30,035,011      30,053,236


The interim results, which have not been audited, have been prepared on the same
basis and using the same accounting policies as those used in the preparation of
the full years accounts to 31 December 2001 and the interim accounts for the 6
month period ended 30 June 2001.

The interim statement, which was approved by the Board on 17 September 2002, is
not the Company's statutory accounts. The statutory accounts for each of the two
years to 31 December 2000 and 31 December 2001 received audit reports, which
were unqualified and did not contain statements under section 237 (2) or (3) of
the Companies Act 1985. The 2000 and 2001 accounts have been filed with the
Registrar of Companies.


For further information, contact:

Christopher Johnston, Chief Executive, Personal Group Holdings Plc,
Tel: [phone] ext. 235

Barrie Newton, Director, Rowan Dartington & Co. Limited,
Tel: [phone]

Simon Rothschild/Trevor Philips, Holborn Public Relations Limited,
Tel: [phone]


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