Interim Results

Stagecoach Theatre Arts PLC 
01 February 2006

Stagecoach Theatre Arts plc - Interim Results 2005

Stagecoach Theatre Arts plc ('Stagecoach')

Announcement of Interim Results for the six months ended 30 November 2005

Stagecoach Theatre Arts operates the UK's largest franchise network of part-time
performing arts schools for young people aged between 4 and 16. Stagecoach
continues to expand its core business, whilst developing other growth areas.
There are now 560 Stagecoach schools, 589 Early Stages classes and 35
SportsCoach schools in the UK, and a total of 34,844 students worldwide (2004:
32,209 students).

Franchise network turnover up 12% to £10.6 million (2004: £9.5 million)

Loss before tax of £0.4m (2004: loss £0.2m), reflecting the continued investment
in SportsCoach and Mini Stages in the UK, and new schools in USA and Germany. As
with the prior year, we expect our full year results to be weighted towards the
second half.

The core UK Stagecoach business, which accounts for 92 per cent of the network
turnover, reported divisional profit, before allocation of general overheads, of
£782,000 for the six-month period.

Significant achievements during the period:

First Early Sporties franchise schools opened, a new format of classes for 4 to
6 year olds;

The Stagecoach Agency secured over 1,100 professional auditions or work
placements for Stagecoach students from 1 August 2005;

A number of high profile successful events and productions during the period,
including 400 Stagecoach students performing at The Theatre Royal, London.

Stephanie Manuel and David Sprigg, Joint Managing Directors, commented:

'The demand for performing arts tuition for children in the UK is at its
greatest level ever, resulting in another period of significant growth in the
number of schools and students attending. We continue to implement our strategy
for expansion in the UK and overseas, whilst maintaining the very high standards
of education throughout all the schools.'



Enquiries:

Stagecoach Theatre Arts:                    Tel: [phone]

Richard Dawson, Finance Director and Investor Relations

Evolution Securities:                         Tel: [phone]

Tom Price

Henry Turcan

Public Relations, JBPR:                    Tel: [phone]

John Burley



Chairman's Statement

Results and Overview

The Group's results for the six months ended 30 November 2005 reflect further
expansion in the core business and the development of and investment in the
emerging divisions. During the Autumn Term 2005, there were 34,844 students
attending Stagecoach, SportsCoach and Mini Stages schools across the network
(Autumn 2004: 32,209 students).

The network turnover, which reports the underlying school fees throughout the
franchise network, was approximately £10.6 million for the period, an increase
of 12% (2004: £9.5 million).

Group loss before tax was £399,000 (2004: loss before tax: £189,000). The loss
for this period reflects the further investment in and development of
SportsCoach, Stagecoach USA, Stagecoach Germany and Mini Stages.

We expect profits of the core business to be higher in the second half of the
year than the first half. There are more income generating school weeks in the
second half of the year than the first half, whilst the costs are evenly spread
throughout the year. In addition, we anticipate that a greater proportion of
initial franchise fees will be recognised in the second half of the financial
year.

Loss per share was 4.4 pence (2004: loss per share: 2.5 pence).

Operational Performance

Stagecoach schools

The numbers of Stagecoach Theatre Arts schools and students attending them have
increased over the period to 560 schools and 23,979 students (2004: 517 schools
and 22,609 students). In addition, the number of Early Stages classes has
increased to 589 with 7,736 students attending (2004: 538 Early Stages classes
and 7,329 students). Across the entire network of Stagecoach Theatre Arts
schools, including the new schools and Early Stages classes opened this Autumn
Term, 95% of all available places are taken.

The demand for performing arts tuition for children in the UK is at its greatest
level ever, and given that Stagecoach Theatre Arts provides the highest
standards of education and service, we are well positioned to meet this
increasing demand.

The core UK Stagecoach business, which accounts for 92 per cent of network
turnover, reported divisional profit, before allocation of general overheads, of
£782,000 for the six-month period, and an estimated profit before tax of
£120,000. Each of the other emerging divisions reported losses for the period,
including the development costs written off.

SportsCoach schools

The SportsCoach franchise network continues to expand, with 35 SportsCoach
schools and 1,270 students (2004: 32 schools and 1,126 students). The
introduction of Early Sporties, classes for 4 to 6 year olds, has proved an
immediate success, with 5 classes and 78 students in the Autumn Term. Your Board
expects that Early Sporties will have the same positive impact on the growth of
the SportsCoach network, by acting as a feeder to the SportsCoach schools, as
Early Stages did for the Stagecoach schools network.

Mini Stages

Mini Stages, music for six-months to five-year-olds, complements the existing
range of educational services offered. We have completed the first year of
franchising Mini Stages classes, and in the Autumn Term 2005 there were 10 Mini
Stages franchisees, 43 sessions and 461 students.

Overseas schools

We continue to invest in and develop both our USA and German subsidiary
companies. Stagecoach USA and Germany each opened a further two franchised
schools in Autumn 2005. Between these two markets, there are 23 Stagecoach
schools, 20 Early Stages classes, 2 Further Stages class and a total of 1,051
students.

Stagecoach Agency

The Group's casting agency for Stagecoach students has been very successful, and
is the biggest children's performing arts agency in the UK. The first nationwide
Stagecoach Agency Brochure produced in conjunction with Spotlight, featured
2,257 students. The Agency is pleased to report that it has secured over 1,100
professional auditions or actual work placements for Stagecoach students in the
period from 1 August to 31 December 2005.

Creative and Educational

The Group staged a number of successful events during the period. The annual
Easy Stages showcase production this year was 'Gypsy Blood', an original musical
production written by Veronica Bennetts, the Group's Educational Director. The
production featured 73 Stagecoach students from schools across the country and
overseas. In August, 380 Stagecoach students from 12 schools performed at the
Dance, Drama and Music Extravaganza at the NEC Birmingham. In November, 400
Stagecoach students performed in the West End, at The Theatre Royal Drury Lane.

During the period we held a series of Training Workshops for School Principals
and Teachers, and have developed a Foundation Course for Teachers of Performing
Arts in collaboration with RADA and Trinity/Guildhall.

Dividend

No interim dividend has been proposed (2004: £nil).

Outlook

The core UK Stagecoach business continues to expand as demand for tuition in the
performing arts increases, whilst we invest for long-term future growth via new
markets and a broader educational offering. The prospects for the future remain
encouraging.

Graham Cole

Chairman

1 February 2006



Independent Review Report to Stagecoach Theatre Arts plc

Introduction

We have been instructed by the company to review the financial information for
the six months ended 30 November 2005 which comprises the consolidated profit
and loss account, the consolidated balance sheet, the consolidated cash flow
statement and related notes. We have read the other information contained in the
interim report and considered whether it contains any apparent misstatements or
material inconsistencies with the financial information.

This report is made solely to the company and in accordance with Bulletin 1999/4
issues by the Auditing Practices Board. Our work has been undertaken so that we
might state to the company those matters we are required to state to them in an
independent review report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than
the company, for our review work, for this report, or for the conclusions we
have formed.

Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The directors are
responsible for preparing the interim report in accordance with the rules of the
London Stock Exchange for companies trading securities on the Alternative
Investment Market which require that the half-yearly report be presented and
prepared in a form consistent with that which will be adopted in the company's
annual accounts having regard to the accounting standards applicable to such
annual accounts.

Review work performed

We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial data
and based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with International Standards on Auditing (UK and
Ireland) and therefore provides a lower level of assurance than an audit.
Accordingly we do not express an audit opinion on the financial information.

Review conclusion

On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 November 2005.

PKF (UK) LLP

Guildford, UK

1 February 2006



Consolidated Profit and Loss Account

Stagecoach Theatre Arts plc


                                                             Unaudited           Unaudited           Audited     
                                                             Six months ended    Six months ended    Year ended  
                                                             30 Nov 2005         30 Nov 2004         31 May 2005 
                                                             £'000               £'000               £'000       
      Turnover                                                                                                   
      Continuing activities                                  2,691               2,520               5,746       
      Acquired activities                                    -                   3                   -           

                                                             2,691               2,523               5,746       

      Operating (loss)/profit                                (393)               (191)               58          
      Continuing activities                                  (393)               (199)               58          
      Acquired activities                                    -                   8                   -           

      Net interest (payable)/receivable                      (6)                 2                   2           

      (Loss)/profit on ordinary activities before taxation   (399)               (189)               60          

      Tax on profit on ordinary activities                   (38)                (57)                (79)        

      Loss on ordinary activities after taxation             (437)               (246)               (19)        

      Minority interests                                     6                   1                   7           

      Retained loss for the period                           (431)               (245)               (12)        

      Loss per share, pence                                                                                      
      - Basic                                                (4.4)               (2.5)               (0.2)       

      - Diluted                                              (4.4)               (2.5)               (0.2)       




Consolidated Balance Sheet

Stagecoach Theatre Arts plc


                                                            Unaudited     Unaudited     Audited     
                                                            30 Nov 2005   30 Nov 2004   31 May 2005 
                                                            £'000         £'000         £'000       
                    Fixed assets                                                                    
                    Intangible assets                       855           827           794         
                    Tangible assets                         106           135           112         

                                                            961           962           906         

                    Current assets                                                                  
                    Stock                                   323           301           262         

                    Debtors                                 1,892         1,781         2,208       

                    Cash at bank and in bank                177           274           504         

                                                            2,392         2,356         2,974       

                    Creditors                                                                       
                    Amounts falling due within one year     (1,203)       (1,093)       (1,362)     

                    Net current assets                      1,189         1,263         1,612       

                    Total assets less current liabilities   2,150         2,225         2,518       

                    Creditors                                                                       
                    Amounts falling due after one year      (69)          -             -           

                    Net assets                              2,081         2,225         2,518       

                    Capital and reserves                                                            
                    Share capital                           494           486           494         
                    Share premium                           1,601         1,545         1,601       
                    Profit and loss account                 4             200           435         

                                                            2,099         2,231         2,530       

                    Minority interest                       (18)          5             (12)        

                    Equity shareholders' funds              2,081         2,225         2,518       


Consolidated Cash Flow Statement

Stagecoach Theatre Arts plc


                                                             Unaudited           Unaudited           Audited     
                                                             Six months ended    Six months ended    Year ended  
                                                             30 Nov 2005         30 Nov 2004         31 May 2005 
                                                             £'000               £'000               £'000       

       Net cash (outflow)/inflow from operating activities   (305)               83                  417         

       Net returns on investments and servicing of finance   (6)                 2                   2           

       Taxation                                              (1)                 (1)                 (148)       

       Capital expenditure                                   (107)               (11)                (10)        

       Acquisitions and disposals                            -                   (17)                (16)        

       Equity dividends paid                                 -                   (195)               (195)       

       Net cash (outflow)/inflow before financing            (419)               (139)               50          

       Financing                                             92                  (3)                 38          

       (Decrease)/increase in cash at bank and in hand       (327)               (142)               88          


Notes to the Interim Report

Basis of preparation

The interim financial statements have been prepared on the basis of the
accounting policies set out in the statutory accounts for the year ended 31 May
2005.

The figures for the year ended 31 May 2005 have been extracted from the
statutory accounts for the year. These accounts received an unqualified audit
report and have been filed with the Registrar of Companies.

The goodwill arising on consolidation in respect of acquisitions has been
capitalised and is amortised over its estimated useful life. The directors
regard 20 years as a reasonable period for the estimated life of goodwill.

The six months figures to 30 November 2005 have not been audited by the Group's
auditors and do not constitute statutory accounts within the meaning of section
240 of the Companies Act 1985.

Loss per share

Loss per share has been calculated on losses for the period divided by the
weighted average number of ordinary shares in issue of 9,879,317 (2004:
9,712,172). The average market value of the company's shares during the period
was less than the exercise price for the company's options, consequently these
options are deemed to be non-dilutive.

Taxation

The expected rate of corporation tax for the year ending 31 May 2005 is 30%. Tax
has been provided for to take account of the Group's expected corporation tax
liability for the year.

Dividends

No interim dividend has been proposed (2004: £nil).

Responsibility

The Directors of the company accept responsibility for the information contained
in this document and to the best of their knowledge and belief (having taken all
reasonable care to ensure that such is the case) the information contained in
this document is in accordance with the facts and does not omit anything likely
to affect the import of such information.

Availability of Interim Report

Copies of these results together with the Chairman's statement are available
from the Company's registered office at The Courthouse, Elm Grove,
Walton-on-Thames, Surrey KT12 1LZ, and are posted on the Company's website,
www.stagecoach.co.uk.


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