Interim Results

Surgical Innovations Group PLC
28 September 2001

SURGICAL INNOVATIONS GROUP PLC


INTERIM RESULTS TO 30 JUNE 2001


CHAIRMAN'S STATEMENT


I am delighted to report that your Group has achieved break-even on turnover
of £728k in the half year to 30 June 2001.


This is very creditable compared with the same period in 2000 when a loss of £
62k, on turnover of £835k resulted after crediting the final licence fee of £
129k on EndoFlex from Genzyme and after writing back an interest provision of
£70k on the loan notes that were converted into equity.


During the period, there has been significant investment in research and
development, with our F1 disposable scissors, part of the Logic range of
laparoscopic instruments and attachments, being successfully launched at the
European Association of Endoscopic Surgeons Congress in Maastricht in June.
Our ergonomically innovative horizontal handle, the F4, will provide the
platform to enable the F1 disposable scissors to be sold in volume in the
second half of the year.


Our thrust is now towards single-use or 'disposable' devices for laparoscopic
surgery.  Following the successful launch of the Logic range, we are ready to
embark upon the development of a multimode port access system for which a DTI
SMART award has been applied.  We are also working with the University of
Delft, in the Netherlands, to develop the F5, a 'pistol-grip' or vertical
handle, to complement our horizontal handle, thereby enabling the requirements
of all surgeons to be satisfied.  We anticipate that both of these products
will be available for sale early next year.


Our move towards the development of single-use devices has been in addition to
our work on our re-usable range of minimally invasive surgery (MIS)
instruments.  In fact, we have enhanced the YelloPort port access system by
the addition of a safety shield, whilst a new design of valves and seals has
enabled costs to be reduced and quality to be improved.


The enhanced range of re-usable instruments has led to renewed interest from
distributors and enabled us to penetrate the USA and Japan, resulting in
significant sales, especially of the YelloPort.


Generally, we have appointed many new distributors worldwide and, in
particular, we have an increased exposure in the USA  which is the largest
market for MIS products.  We have an excellent and experienced UK distributor,
Mantis Surgical, who are not only increasing sales of our products through
their hospital network, but also providing us with valuable market insight.


Our Autologous Blood Transfusion (ABT) products continue to create interest at
home and abroad, helped by the continuing concern about the spread of HIV and
CJD through contaminated blood.  We have developed new markets, which include
Russia, India, Japan, Iran and Turkey.


We have also successfully introduced a new single-use product, the
Arthroflush, a simple-to-use but very effective fluid management system, which
is targeted at the arthroscopy and urology markets.


The royalties on EndoFlex continue to average in excess of £25k per month and
produce a most useful stream of cash and earnings enabling us to support our
research and development programme.


This programme, undertaken by our young, energetic and talented design team,
is the key to the future of our business and the results are already being
seen through the launch of innovative products over the last few months with
more soon to come.  The team operate under the banner of Ion Product Solutions
and, although they are available to work on contracts from other healthcare
companies, during the first half of the year their energies were concentrated
internally as we have many new products to bring to market.


As a Board, we are more confident of the future than we have ever been,
particularly as we now have a serious foothold in the market for single-use
devices.  We believe that we will be profitable during the second half of the
year and this will provide a firm base for future growth.


We continue to examine potential acquisitions and strategic corporate
relationships as we are always mindful of our responsibility to improve
shareholder value whether by organic growth or by acquisition.


On your behalf, I wish to thank my fellow directors, especially Graham Bowland
and Stuart Moran, who continue their sterling performance, and to thank all
the staff for their efforts.  Each and every one has played a vital part in
the continued development of the company.


DOUGLAS LIVERSIDGE, C.B.E,

Chairman




Surgical Innovations Group PLC      Unaudited    Unaudited             Audited
                                  6 months to  6 months to        12 months to  
                                      30.6.01      30.6.00            30.12.00

                                        £'000       £'000                £'000

Turnover (including licence fees)         728         835                 1,790

Cost of Sales                           (333)       (349)                 (838)
                                   ----------  ----------            ----------

Gross Profit                              395         486                   952


Administrative expenses
Before exceptional item                 (401)       (600)               (1,067)
                                   ----------  ----------            ----------

Operating loss                            (6)       (114)                 (115)

Exceptional item:
        Administrative expenses            --        (30)                  (30)

Net interest receivable                     6          82                    88
                                   ----------  ----------            ----------


Loss attributable to shareholders          --        (62)                  (57)
                                   ----------  ----------            ----------

Loss per ordinary share                    --     (0.03p)               (0.02p)
                                   ----------  ----------            ----------



Notes :


1. The consolidated financial information does not constitute full accounts
   within the meaning of the Companies Act 1985 and has not been reported on by
   the auditors or delivered to the Registrar of Companies.  The figures for
   the year ended 31 December 2000 have been extracted from the full accounts
   for that year, on which the auditors gave an unqualified report and which
   have been filed with the Registrar of Companies.
2. The exceptional administrative expenses relate to a compensation for loss of
   office payment made following the Board changes in April 2000.
3. The Directors have not declared an interim dividend.
4. The loss per share is based on the weighted average number of shares in
   issue during the period.  The total number of shares in issue at 30 June
   2001 was 254,037,126 at 31 December 2000 was 254,014,780 and at 30 June 2000
   was 253,999,608.




Surgical Innovations Group PLC        Unaudited     Unaudited           Audited
                                    6 months to   6 months to      12 months to 
                                        30.6.01       30.6.00          30.12.00

                                          £'000      £'000                £'000
Fixed Assets

Tangible Assets                             271        273                  272
                                     ---------- ----------           ----------

Current Assets

Stock                                       448        457                  428
Debtors                                     479        403                  601
Cash at bank and in hand                    391        488                  374
                                     ---------- ----------           ----------
                                          1,318      1,348                1,403

Creditors:
Falling due within one year               (422)      (459)                (508)
                                     ---------- ----------           ----------

Net Current Assets                          896        889                  895
                                     ---------- ----------           ----------

Total assets less current                 1,167      1,162                1,167
liabilities

Creditors :  amounts falling due
after more than one year                   (110)      (112)                (111)

                                     ---------- ----------           ----------

Net Assets                                1,057      1,050                1,056
                                     ---------- ----------           ----------

Capital and reserves

Called up share capital                   2,540      2,540                2,540
Share premium account                    16,030     16,029               16,029
Capital reserve                             329        329                  329
Accumulated losses                     (17,842)   (17,848)             (17,842)
                                     ---------- ----------           ----------
                                          1,057      1,050                1,056
                                     ---------- ----------           ----------


Note :

The balance sheet at 30 June 2001 reflects the conversion in the period of £
838 of convertible loan notes and the subsequent issue of 22,346 shares.

END