Strategic review and trading

Petards Group PLC
20 December 2007


                 Petards Group plc ('Petards' or 'the Company')

                      Strategic review and trading update

Petards, the AIM listed developer of advanced surveillance systems, announces an
update on its strategic review and trading.


Strategic Review

In the Interim Statement at the end of September the board indicated that it was
appraising opportunities to partner or combine with other businesses to create
synergies and critical mass and was also considering the financing requirements
to enable it to reach its full potential while remaining independent. In
November the board announced that it had appointed ICON Corporate Finance
Limited to act as corporate finance advisors to the Company and provide
assistance in the further development and implementation of the board's
strategy.

The board has now concluded its review and decided that the potential of the
Company will best be realised by focusing its resources on a more limited range
of technologies and markets. Accordingly it is currently in exclusive
discussions with a third party that the board hopes will shortly lead to the
disposal of its UK Government and Commercial software business which includes
the software products UVMSTM, Advantage and COBYT. The cash proceeds from the
disposal will be used to reduce the group's bank indebtedness and to invest in
the remaining parts of the business.

The board continues to evaluate other means of maximising shareholder value and
will continue to update shareholders as appropriate.


Trading Update

Since the beginning of October the Company has received orders exceeding £7m,
including the contract from First Great Western for Petards eyeTrainTM on-board
digital CCTV surveillance systems incorporating Petards Automatic Passenger
Counting (APC) system worth over £1m and two contracts from the Ministry of
Defence for the supply of electronic warfare defence systems worth over £2m that
have been previously announced. The Company has recently received an order from
a casino operator in the USA for the installation of its UVMS video management
systems worth $1.1m and further orders for APC systems and the supply of
electronic warfare defence systems totalling £1.5m.

The level of these orders represents a booked:billed ratio of over 1.7 in the
last quarter but, in view of the timing of their receipt, most will not be
delivered until 2008. Sales for the full year to 31st December 2007 are expected
to be slightly lower than market expectations, which, with unchanged margins,
will result in a  higher operating loss than previously expected, although this
would be more than compensated for by the expected profit to be reported on the
sale of the UK Government and Commercial software business.

The Company has consulted its bankers throughout the strategic review and is
confident of their continued support for the business and the strategy that the
board is following.

After a difficult six months the Company will emerge stronger in the New Year
with a more substantial order book than twelve months ago. The board hopes to
report to shareholders on further progress shortly.



For further information:

Petards Group plc                    Collins Stewart Europe Limited    Parkgreen Communications Ltd
Andy Wonnacott, Finance Director     Mark Connelly                     Paul McManus
Tel: [phone]                   Tel: [phone]                Tel: [phone]
www.petards.com                                                        Mob: [phone]
                                                                       [e-mail]



                      This information is provided by RNS
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