Final Results

Surgical Innovations Group PLC
28 March 2003

Surgical Innovations Group plc
Preliminary results for the year ended 31 December 2002
28 March 2003


CHAIRMAN'S STATEMENT

I am pleased to report further progress in your Group's overall performance in
the year 2002.

Group turnover increased from £1,847k in 2001 to £2,224k in 2002, an increase of
20%, which has resulted in a pre-tax profit of £60k compared with £36k in the
previous year.

Our royalty income from sales of EndoFlex by Snowden Pencer in the USA and
around the world has been maintained, with a contribution of £298k for the year.
This has been reinvested in our continuing innovative product development
programme which is the cornerstone of the Group's future growth.  Overall, we
have incurred research and development expenditure of £256k, representing 12% of
turnover, which I believe is indicative of our commitment in this vital area.

I am particularly pleased with the continuing progress in the development of
Uniglide, our unique next-generation single-use port access system.  In my
interim statement, I indicated that the launch of the product would be early in
2003.  We now anticipate a product launch during this second quarter of the
year.  The development of this product represents the largest single investment
in instrumentation the Group has ever made and our preliminary soundings
indicate exciting worldwide sales opportunities.

Sales of our single-use scissors continue to increase following the successful
introduction of the Logic pistol grip handle.  The development of alternative
scissors for use with Aesculap's range of pistol-grip handles is now resulting
in worldwide sales through both Aesculap in Germany and its American subsidiary.
We are looking forward to working with this important partner and other
internationally renowned medical device companies to expand the markets for our
innovative products.

Later this year, our main focus, having completed the development of our new
port system, will be on re-engineering our range of Autologous Blood Transfusion
(ABT) products.  We remain totally convinced that using the patient's own blood,
in an intra- and post-operative environment will have significant benefits in
avoiding the effects of cross infection from contaminated blood.  The cost of
donated blood continues to increase, as a result of the increasing requirement
for more stringent testing and controls, coupled with an anticipated decline in
donors.  Therefore, the ABT alternative is recognised both by governments around
the world and hospital administrators as an important component in the provision
of blood for patients.

We have already taken the important decision to create a new manufacturing
facility for ABT disposables.  This should allow us to reduce costs, improve
margins, and develop and enhance the manufacturing processes, thereby enabling
us to promote the products to a broader international market.

2002 was an important year for your Group as high calibre people were recruited
or promoted to strengthen the key managerial functions of the Group.  As
planned, this investment in people is allowing the Executive Directors to devote
more time to the strategic development of the Group, business opportunities and
investor related activities.

Whilst making every possible effort to increase the pace of our internal
development within the constraints of our own financial resources, we continue
to look for opportunities for acquisitions and key strategic relationships.
These are difficult times in the small public company market.  We are determined
to increase shareholder value and will continue to pursue genuine corporate
opportunities, without prejudicing our plans for organic growth.

Once again, on your behalf, I wish to thank my Board colleagues and all the
Group's employees for their continued dedication and commitment and I look
forward to reporting further progress at the Annual General Meeting and through
our newly constructed web-site, www.sigroup.plc.uk.

Doug Liversidge CBE
Chairman
27 March 2003





Consolidated Profit and Loss Account
For the year ended 31 December 2002

                                                               Notes                 2002           2001
                                                                                    £'000          £'000

Turnover (including Royalties)                                                      2,224          1,847
Cost of sales                                                                     (1,048)          (846)
Gross profit                                                                        1,176          1,001

Administrative expenses                                                           (1,098)          (900)
Abortive acquisition costs                                                              -           (72)
Operating profit                                                                       78             29

Interest receivable                                                                     1             13
Interest payable                                                                     (19)            (6)

Profit on ordinary activities for the year before taxation                             60             36

Tax on profit on ordinary activities                                                   18             48
Retained profit for the year                                                           78             84


Earnings per ordinary share                                         2               0.03p          0.03p





Consolidated Balance Sheet
As at 31 December 2002

                                                    31 December 2002               31 December 2001
                                                            £'000        £'000        £'000       £'000
Fixed assets
Tangible assets                                                            660                      282

Current assets
Stocks                                                        562                       549
Debtors                                                     1,073                       825
Cash at bank                                                   13                       170
                                                            1,648                     1,544

Creditors : amounts falling due within one year             (775)                     (574)
Net current assets                                                         873                      970


Total assets less current liabilities                                    1,533                    1,252

Creditors : amounts falling due after
more than one year                                                       (285)                    (111)

Net assets                                                               1,248                    1,141

Capital and reserves
Called up share capital                                                  2,555                    2,540
Share premium account                                      16,044                    16,030
Capital reserve                                               329                       329
Accumulated losses                                       (17,680)                  (17,758)
                                                                       (1,307)                  (1,399)
Equity shareholders' funds                                               1,248                    1,141



Consolidated Cash Flow Statement
For the year ended 31 December 2002

                                                        Notes            2002                2001
                                                                     £'000      £'000    £'000     £'000


Net cash (outflow) from operating activities              3                     (141)              (121)

Returns on investments and servicing of
finance                                                                          (18)                  8
Taxation                                                                           11                  -
Capital expenditure                                                             (207)               (88)

Net cash (outflow) before financing                                             (355)              (201)

Financing
Issue of shares                                                          3                   -
Receipts from borrowings                                                 9                   -
Capital repayments under bank loans                                    (1)                   -
Capital repayment under finances                                      (22)                   -
Net cash (outflow) from financing                                                (11)                  -

(Decrease) in cash                                        4                     (366)              (201)





Notes

For the year ended 31 December 2002

1. Accounting Policies

   The principal accounting policies which remain unchanged from the previous year, except for the adoption of FRS 19   
   which has had no material effect on the financial statements, are as follows:

   A)           Basis of accounting

                The financial statements have been prepared under the historical cost basis of accounting and in        
                accordance with applicable Accounting Standards in the United Kingdom.

   B)           Basis of consolidation

                The Group financial statement consolidate those of the Company and of its subsidiary undertakings drawn 
                up to 31 December 2002.  The results of subsidiaries accounted for under the acquisition accounting     
                method are included in the consolidated profit and loss from the date of their acquisition.  The results
                of subsidiaries, accounted for under the merger accounting method, are included in the consolidated     
                profit and loss account as if they had always been part of the Group.  Intra-Group sales and results are
                eliminated on consolidation and all sales and results relate to external transactions only.

2. Earnings per Ordinary Share

   The earnings per Ordinary Share has been calculated by dividing the profit attributable to ordinary shareholders for 
   the year ended 31 December 2002 of £78,000 (2001 : £84,000) by the weighted average number of Ordinary Shares in     
   issue during the year of 254,995,289 (2001 : 254,028,882) and amounted to 0.03p per share (2001 : 0.03p per
   share).

3. Net cash outflow from operating activities
                                                                                                                        
                                                 2002                    2001
                                                £'000                   £'000

Operating profit                                   78                      29
Depreciation of tangible fixed assets              88                      78
(Increase) in stocks                              (13)                   (121)
(Increase) in debtors                            (241)                   (176)
(Decrease) / increase in creditors                (53)                     69
                                                 (141)                   (121)


4. Reconciliation of net cash flow to movement in net debt/funds


                                                 2002                    2001
                                                £'000                   £'000


(Decrease) in cash in the year                   (366)                   (201)
Cash outflow from finance leases and loans         14                       -
Change in net funds resulting from cash flows    (352)                   (201)
Conversion of loan notes                            1                       -
New finance leases                               (259)                      -
Movement in net debt                             (610)                   (201)
Net funds at beginning of year                     51                     252
Net debt at end of year                          (559)                     51


5. Analysis of changes in net funds

                                                                                                                        
                                                    At         Cash flow       Non-cash                     At
                                             1 January                                             31 December
                                                  2002                                                    2002
                                                 £'000             £'000          £'000                  £'000

Cash at bank and in hand                           170              (157)             -                     13
Bank overdrafts                                     (8)             (209)             -                   (217)
                                                                    (366)

Bank loan                                            -                (8)             -                     (8)
Finance leases                                       -                22           (259)                  (237)
                                                                      14

Convertible loan notes                            (111)                -              1                   (110)
                                                    51              (352)          (258)                  (559)

6. The Annual General Meeting of the Company will be held at the Village Hotel and Leisure Club, 186 Otley Road, 
Headingley Leeds LS16 5PR at 12.30 on Wednesday, 30 April 2003


7. The foregoing statements do not constitute the Group's statutory accounts.  The Group's statutory accounts, on which 
the Company's auditors, Grant Thornton, have given an unqualified opinion in accordance with Section 235 of the 
Companies Act 1985, are to be delivered to the Registrar of Companies and will be posted to shareholders shortly.
Additional copies of the Annual Report and of this announcement will be available at the Company's registered office: 
Clayton Park, Clayton Wood Rise, Leeds, LS16 6RF




Enquiries:


Surgical Innovations Group
Graham Bowland, Finance Director                     Tel: [phone]

Philip Johnson                                       Tel: [phone]
Brown, Shipley & Co. Limited




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