Final Results

Volex Group PLC
04 June 2003

Embargoed until 7.00am. 4 June 2003


                               VOLEX GROUP p.l.c.


    Preliminary Announcement of Group Results for the Year to 31 March 2003


Volex Group p.l.c., the international electrical and electronic cable assemblies
group, today announces its preliminary results for the year to 31 March 2003.


The Group also announces that it has successfully completed its discussions on
amendments to the financing agreement with its lenders, confirming the
availability of financing through to 30 June 2004 with the Company having the
option to renew for a further 12 months (subject to the Company fulfilling
certain financial conditions).


In light of the out turn for the full year, the Company is not recommending the
payment of an ordinary dividend for the year.



Financial Highlights:


• Sales down 17% to £230m (on constant currency basis down 14%)

• Operating profit for the year of £0.6m(1) before goodwill impairment and
  amortisation

• Gross profit margins increased by 4% to 15%, reflecting reductions in the
  cost base of £5m

• Net borrowings down £11.6m during year and overall debt position reduced

• Headline result per share shows a 13% improvement over last year

• Company remains cash generative

• Working capital reductions



Operational Highlights:


• Confirmation of continued financing to 30 June 2004 with the Company
  having the option to renew for a further 12 months (subject to the Company
  fulfilling certain financial conditions)

• Ongoing rationalisation programme should see continued cost savings:


• Low cost manufacturing base established in Poland

• Transitioned UK power cord manufacturing to our existing low cost
  facilities in China

• Additional focus on manufacturing activity in Mexico


• New customer wins and increased market share despite difficult trading
  conditions



The Chairman of Volex, Dom Molloy, commented:


'The 2003 financial year saw a continuation of difficult trading conditions for
the Group. The widely anticipated second half upturn in our customers fortunes
failed to materialise and we therefore continued to rationalise our operations
and lower our breakeven point.


In line with the trading statement issued on 6th March 2003 the full year closed
at a revenue level of £230m, a reduction of 17% over 2002. An operating profit
pre-goodwill impairment and amortisation of £0.6m(1) compares favourably on
reduced revenues to an equivalent operating loss (pre exceptional item) of £0.5m
(1) for the prior year. The Group's gross profit margin improved by 4% to 15%
reflecting the reductions in the cost base of £5m, achieved in part by a
re-balancing of capacity levels and the migration of production activities to
lower cost manufacturing locations. Net borrowings at year-end were £38.8m, a
reduction of £11.6m over 2002. Capital expenditure at £2.4m was restricted to
35% of depreciation without impairing the requirements of customer and
technology development programs. We have reduced the carrying value of goodwill
in respect of our business in Brazil to £2m.


We had a number of successes during the year. We established our cable assembly
operations in Poland initially through an outsourcing programme with
Flextronics, creating a low cost manufacturing centre for our consolidated
European operations. We transitioned most of our UK power cord manufacturing to
our facilities in China. We added many new customers and maintained excellent
relationships with our existing customers resulting in increased market share.
Despite adverse market conditions the Group returned to profitability at the
operating level pre goodwill, was cash generative, reduced its overall debt
position and successfully renegotiated its banking facilities to provide the
necessary financing for the foreseeable future.


We continue to find it difficult to forecast the timing of the upturn in market
conditions. Given this, we aim to continue to reduce our cost structure, make
prudent investments to ensure our future, generate cash to lower our debt
position and continue to focus on market share gains.


The Group is determined to return to more acceptable levels of operating profit
and reduce its gearing. I am confident that with the dedicated team we have in
place these objectives will be met.'


John Corcoran, Volex Chief Executive, in concluding his review of the year
commented:


'The reputation of Volex for quality, service, responsiveness and flexibility is
well founded: we offer total cable assembly solutions from design through
delivery to portfolio management. The challenge for the Group is to weather the
storm of economic uncertainty and depressed spending patterns while continuing
to improve profitability and reduce debt. I believe that the actions taken and
those in process will ensure that these key objectives are achieved in the
forthcoming financial year driving the business to levels of returns more
acceptable to our shareholders.'


                                      Ends


(1) Operating loss after goodwill impairment £8.7m (2002 - £nil),
    goodwill amortisation £0.9m (2002 - £0.9m) and exceptional items
    £nil (2002 £1.0m) - £9.0m (2002 - loss of £2.4m).


For further information, please contact:


Volex Group p.l.c.              Today: 020 7067 0700   Thereafter: 01925 830101

Dom Molloy, Chairman

John Corcoran, Group Chief Executive

David Hudson, Group Finance Director


Weber Shandwick Square Mile                                       020 7067 0700

Chris Lynch / Peter Corbin



VOLEX GROUP p.l.c.


Preliminary Announcement of Group Results for the Year to 31 March 2003


The year to 31st March 2003 was characterised by continuing difficult trading
conditions within the Group's most significant markets, most of which had been
forecast to recover in the second half. Business success was therefore
predicated on outpacing inherent market declines by increased market
penetration. The realisation of those gains, however, was not in the timeframe
predicted by the business for the second half.


The Group has taken action: by focusing on stemming the potential losses,
driving cash generation and reducing the debt burden. The operating profit
break-even point continued to be reduced half-year on half-year ending at an
annualised revenue level of £220m from a £240m starting point based on the
current sales mix, exchange rates and pricing structure. The business remains
cash generative with consistent attention to the utilisation of working capital,
the management of expenses and prudent expenditure on capital equipment. Our net
borrowings fell by £11.6m to £38.8m representing a significant over achievement
against targets.


The dynamics of the global cable assembly business have not changed:
consolidation and outsourcing from OEMs (Original Equipment Manufacturers) to
EMS (Electronic Manufacturing Service) providers, dramatic reduction by our
customers of their supply base and the shift from regional to global supply
sourcing. Volex continues to use its global presence, its product breadth and
its account management strength to improve its market share. Our focus on cost,
migrating product to lower cost locations and meeting customer requirements
wherever they need to be supported, continues to position the Group well within
the industry.


The financial health of the Group was, and remains, the top priority. The debt
reduction and the successful conclusion of our recent discussions with the
Company's bankers have ensured that finance is in place for the foreseeable
future.


Global Markets


The Group continued to service its core market segments of infocom and consumer
products while more aggressively targeting areas such as the industrial,
transportation and medical sectors where it had less of a presence.


The telecoms market followed on from its dramatic decline in the prior financial
year with further reductions in revenue opportunities as demand for wireline and
wireless infrastructure remained depressed. Whilst the financial difficulties
recently experienced by operators and carriers were alleviated, the investment
in networks by both carriers and enterprises were limited throughout the year.
Demand from the fixed line business was particularly low as excess inventories
and improved utilisation of existing network equipment drained demand for system
upgrades or new equipment investments. The wireless market difficulties were
characterised by both a confusion of competing technologies and a more cautious
approach to network infrastructure investment in advance of subscriber demand.
Volex operates across all established technologies (UMTS, CDMA, WCDMA and EDGE)
with a range of customers and will be well placed when the dominant technology
emerges.


Demand for information technology server and networking products, while
predicted to return to growth at the beginning of 2003, remained at low levels.
Low-cost entrants and developments in the server segment on high-speed copper
technologies compounded this situation. Improved corporate results and a
healthier economic environment will ultimately fuel renewed investments in
server and data network equipment.


The power cord market continued to offer the Group stability through the year as
consumer-spending patterns were sustained. While the market for personal
computers was flat, the Group preserved its revenue stream by tracking shifts in
market share between the OEMs. The consumer appliance and electronics sectors
were also positive throughout the year as interest rate reductions in most
economic regions continued to sustain consumer spending. The high rate of
technology churn in the electronics segment also enabled the Group to use its
expertise in product development and industrialisation to secure a foothold on
significant new programs across the customer base.


The specialist harness segment also remained stable throughout the year.
Concentrating on the niche market for off-highway equipment, specialist vehicles
and aerospace customers, we continued to develop new accounts and new
sub-markets. The end-customer demand remained strong in the vehicle segment
offsetting continued weakness for aerospace harnesses as that market continued
to experience difficulties.


Sales, Marketing and Operations


Sales declined year-on-year by 17% reflecting relatively strong first half sales
in the previous year, the impact of order book rescheduling in 2003 and
continued weakness in the infocom segment throughout the year. Sales for the
second half of 2003 were down 5% compared to the second half of the previous
year.


In the Americas, the decline in economic conditions, particularly through the
second half, exceeded the regions ability to increase its market share and sales
reduced by 22% year on year. The region benefited to a small degree from the
West Coast dock strike as customers who were solely dependent on supply lines
from Asia, revisited this strategy to the benefit of our facilities in Mexico.
In response to reduced demand, the Group closed one of its facilities on the
West Coast in Chula Vista and migrated the manufacturing activity to Mexico. In
addition, the region concentrated its volume manufacturing in its three low-cost
Mexican facilities and re-profiled its US and Canadian sites to provide
customer-facing engineering and technical support. In view of the economic and
market conditions in Brazil we have written down the value of our goodwill
investment in the region by £8.7m.


Sales in Asia declined by 9%, impacted heavily by a stalled telecoms market,
particularly in China. The region increased power cord sales but this was not
sufficient to offset a difficult regional telecommunications market. This region
also benefited from the migration of equipment manufacturers to China, where the
Group has three established manufacturing facilities and an eleven-year presence
in the country. Recent success on the green product program and its penetration
of the Japanese end-customer base is also providing the other regions with
improved product and customer offerings. The Group's growing presence in India
was also noteworthy this year and should provide a platform for new revenue
streams in this rapidly developing marketplace.


While sales in Europe declined by 15%, this region delivered growth in the
second half over the first. The rapid deployment of ADSL technology in Europe
combined with secured wins on new telecom customers and increased penetration of
existing customers provided incremental revenue in the final two quarters above
that delivered in the early part of the year. Our presence in Europe was
enhanced by the addition of a second facility in Poland. It provides the region
with a new revenue source with little capital investment and ensures that the
Group delivers on its commitment to service its customer base close to the
customer's point of assembly.


The specialised harness business, developed significantly through the year with
the provision of low-cost manufacturing from our facilities in Estonia and
China. Both additions enabled the business to compete with lower cost solutions
and the unit should realise the full benefit of this in the forthcoming year.
While the aerospace end-market continues to suffer, recent business awards on
military-related programs, spanning a number of years, will provide this
business with stability in a difficult environment.


The Future


Our strategy is clear: we must increase our profitability and generate
sufficient cash to reduce our debt and fuel our growth. We will execute this
strategy recognising that market conditions remain weak and we must continue to
aggressively outperform market uncertainty and decline by increasing our share
of the addressable market. In parallel, the focus on cost continues and by
consistently improving the utilisation of working capital, generating cash and
controlling expenditure we expect to dramatically improve the financial footing
of the Group. Our global team is aligned to these key tasks that will be
achieved by:


-   Continually addressing the cost base and relentlessly driving our
    supply base for cost reductions.


-   Driving a total solution sell, where Volex can provide total
    portfolio management and provision capability utilising our Global
    footprint and our operational and technical strength.


-   Continuing to develop a leading supply chain capable of supporting
    global customers globally.


-   Leveraging our independence of connector and cable solutions to offer
    the customer opportunities for design and component substitution cost
    reductions.


-   Expanding our customer and market segment penetration, reducing the
    impact of segment and/or customer demand fluctuations.


The reputation of Volex for quality, service, responsiveness and flexibility is
well founded: we continue to offer total cable assembly solutions from design
through delivery to portfolio management. The challenge for the Group is to
weather the storm of economic uncertainty and depressed spending patterns while
continuing to improve profitability and reduce debt. I believe that actions
taken and those in process will ensure that these key objectives are achieved in
the forthcoming financial year driving the business to levels of returns more
acceptable to our shareholders.


FINANCIAL REVIEW


A geographical review of sales by destination showed sales in the Americas fell
by 22% over last year and represented 38% of Group sales (2002 - 41%). Sales to
customers in Asia decreased by 9% but as a percentage of Group sales increased
by two percentage points to 25%. Sales in Europe as a whole declined by 15%, but
as a percentage of Group sales increased by one percentage point to 37%. Intra
Group sales, largely manufactured in Asia and Eastern Europe increased by 14%
over last year, with significant new activity in Eastern Europe in particular.


A comparison of Group sales by origin or manufacturing location, based on total
sales including intra-Group trading (i.e. output at selling prices) showed a
year on year decline in Europe of 13%, with Europe accounting for 36% of the
Group's output, similar to last year. Asia's output declined by 5% in value over
the previous year: this region now produces 28% of Group output (2002 - 25%),
whilst output in the Americas declined by 21% and accounted for 36% of Group
output (2002 - 39%). An analysis of sales by product category and market sector
is given in note 1 to the results.


The Group recorded an operating profit (pre goodwill impairment and
amortisation)(1) for the year of £0.6m (2002 - loss of £0.5m). The Group's gross
profit margin improved by four percentage points to 15% due to the continuing
efforts to reduce the Group's overheads and resulting break-even sales level.


During the year the Group realised the annualised benefit of overhead reductions
implemented during the second half of the previous financial year (2001/2002)
and took further steps to reduce the cost base in the current year by migrating
production activity to lower cost labour manufacturing sites within the Group.
The combined effect of these Group-wide cost reductions through the year was a
reduction in production and other overheads of some £5m annually, over and above
the £15m savings of last year. As a result, the Group has reduced its operating
profit break-even point to an annual sales level of approximately £220m
depending on product and/or geographic mix.


There was an exceptional goodwill impairment charge of £8.7m associated with the
anticipated activity level of our business in Brazil. The goodwill amortisation
charge before this exceptional impairment charge was £0.9m for the year.


Finance charges (net)(2), excluding exceptional finance costs and amortisation
of debt issue costs for the full year of £3.1m, were similar to last year,
reflecting an increase in the underlying borrowing costs despite the decrease in
net borrowings.


The result for the year after tax was a loss of £12.7m (2002 - loss of £10.1m).


The translation of foreign currency turnover and operating profits into sterling
compared with last year's average rates resulted in a reduction in turnover of
£8.2m (or 3%) and a negligible profit effect.


Loss per share this year of (44.3)p compared with (35.5)p last year. However,
headline loss per share (i.e. before goodwill amortisation, goodwill impairment
and exceptional items net of tax) of (7.3)p shows a 13% improvement over last
year (2002 - (8.4)p).


Taxation


The tax credit for the year resulted in an effective composite rate of 7.0%
(2002 tax credit - 27.8%). However, before the goodwill impairment and
amortisation, the effective rate would have been 23.6% (2002 - 29.6%).


Different tax rates apply to the Group's world-wide operations, the highest rate
relating to the North American operations, with lower than average tax rates
currently applying in Asia and Ireland.


Funds Flow


During the year there was a net inflow of funds before financing of £7.3m,
comprising inflows of £13.1m from operations and £2.4m from tax, in part offset
by outgoings of £2.3m on capital expenditure, and £5.9m on interest/financing
costs. Currency translation of £4.3m impacted favourably on the debt position
during the year.


Capital Expenditure


Fixed asset additions in the Group totalled £2.4m (2002 - £4.6m) during the
year, a multiple of depreciation of 0.35 times compared with 0.54 times last
year. This reduction, part of the Group's action programme to reduce borrowings,
was carried out without detriment to the longer-term strategic plan, as the
Group continues to have sufficient production capacity.


Borrowings


The Group's net borrowings at the end of the year were £38.8m (2002 - £50.4m).
These borrowings resulted in a year-end gearing ratio of net borrowings to
shareholders' funds of 86.0% (2002 - 85.0%), which would have been 72.1% prior
to the exceptional goodwill impairment charge.


The Company completed the negotiation of amendments to the terms of its
borrowings with its principal bankers, shortly before the approval of the 2003
Annual Report and Accounts. These bank facilities continue to give the Group
adequate funding for its foreseeable requirements.

The majority of facilities are multi-currency and remain available to the
Company until June 2004, with the Company having the option to extend for a
further year subject to compliance with certain performance criteria. The
Company's facilities continue to be provided on a secured basis with a margin
increase of 100 basis points (1%). In addition, the exercise price of the
previously issued option warrants for 5% of its issued ordinary share capital,
is to be adjusted to be set at a 25% premium to the average share price over the
30 day period starting 5 June 2003. The banks will have the opportunity to
exercise these warrants between July 2003 and 30 June 2005, with an automatic
extension of this exercise period until 30 June 2007 to the extent that each
bank remains a committed lender to the Group during this extension period. The
total costs incurred in the re-negotiation and amendment of the Group's finance
was £1.0m which is charged as a finance cost against this year's result,
together with £0.5m of costs relating to the previous refinancing exercise,
which are being amortised over the initial two years of the facilities.


Employees


The average number of employees fell year on year by 12% to 8,353 (2002 -
9,546). The average cost per employee reduced by 9%. This percentage reduction
reflects the Group's strategy to transfer production to lower cost environments.
At the year-end 51% of our employees were in Asia, 28% in the Americas and 21%
in Europe.



(1)  Operating loss after goodwill impairment £8.7m (2002 - £nil),
     goodwill amortisation £0.9m (2002 - £0.9m) and exceptional items £nil (2002
     £1.0m) - £9.0m (2002 - loss of £2.4 m).



(2)  Finance charges (net) including refinancing costs £1.0m (2002 -
     £.23m) and amortisation of debt issue costs £0.5m (2002 - £nil) -
     £4.6m (2002 - £5.3m).


Volex Group plc

Preliminary Announcement of Group results for the year to 31 March 2003



A. Profit and Loss Account

For the year ended 31 March 2003



                                               2003                        2002
                                Notes         £'000                       £'000

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

Turnover

Continuing operations               1       230,066                     275,696

Cost of sales                              (195,995)                   (244,631)
                                           ---------                   ---------

Gross profit                                 34,071                      31,065

Other operating expenses (net)      2       (43,083)                    (33,517)

                                           ---------                   ---------
Operating profit/(loss) pre
goodwill amortisation and
impairment and exceptional item                 573                        (548)
Exceptional operating item          3             -                      (1,033)
Amortisation of goodwill                       (933)                       (871)
Impairment of goodwill                       (8,652)                          -
                                           ---------                   ---------

                                           ---------                   ---------
Operating loss - continuing
operations                                   (9,012)                     (2,452)


Costs of fundamental
restructuring of
continuing operations               4             -                      (6,278)
                                           ---------                   ---------
Loss on ordinary activities
before finance costs                         (9,012)                     (8,730)


                                           ---------                   ---------
Finance charges - interest (net)    6        (3,084)                     (3,060)

                - refinancing
                  costs             7        (1,000)                     (2,260)

                - amortisation
                  of debt issue
                  costs             8          (509)                          -

                                           ---------                   ---------
Total finance charges                        (4,593)                     (5,320)
                                           ---------                   ---------
Loss on ordinary activities
before taxation                             (13,605)                    (14,050)

Tax on loss on ordinary
activities                          9           948                       3,907
                                           ---------                   ---------
Loss for the financial year                 (12,657)                    (10,143)
                                           ---------                   ---------
Dividends paid on equity
and non-equity shares              10            (6)                     (1,585)
--------------------------------------------------------------------------------

Loss for the year
transferred from reserves                   (12,663)                    (11,728)

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

Headline loss per ordinary share   11          (7.3)                       (8.4)p

Basic loss per ordinary share      11         (44.3)p                     (35.5)p

Diluted loss per ordinary share    11         (44.3)p                     (35.5)p




B. Consolidated Statement of Total Recognised Gains And Losses

For the year ended 31 March 2003






                                                       2003         2002
                                Notes                 £'000        £'000
--------------------------------------------------------------------------------

Loss for the financial year                         (12,657)     (10,143)

Unrealised deficit on revalued
freehold and leasehold buildings                     (1,419)           -

Currency variations                                    (100)        (695)
--------------------------------------------------------------------------------
Total recognised losses
relating to the year                                (14,176)     (10,838)
--------------------------------------------------------------------------------


C. Group Balance Sheets

At 31 March 2003


                                                              2003         2002
                                Notes                        £'000        £'000
--------------------------------------------------------------------------------


Fixed assets

Goodwill                           13                       4,374        14,065

Tangible assets                                            33,844        41,232
                                                          --------      --------
                                                           38,218        55,297
                                                          --------      --------
Current assets

Stocks                                                     29,219        35,735
Debtors                                                    52,938        52,344
Properties held for resale                                  1,482         1,482
Cash at bank and in hand                                   13,728        13,090
                                                          --------      --------
                                                           97,367       102,651

Creditors: amounts falling
due within one year

    Borrowings                                             (3,815)       (2,897)

    Trade creditors and provisions                        (38,792)      (34,995)
                                                          --------      --------
Net current assets                                         54,760        64,759
                                                          --------      --------

Total assets less current liabilities                      92,978       120,056

Creditors: amounts falling due
after more than one year

        Borrowings                                        (47,845)      (60,602)

Provisions for liabilities and charges                          -          (139)
--------------------------------------------------------------------------------

Net assets                                                  45,133       59,315

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

Capital and reserves


Called-up share capital                                      7,231        7,231

Reserves                                                    37,902       52,084

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

Shareholders' funds*                                        45,133       59,315

--------------------------------------------------------------------------------
Gearing**                                                       86%          85%



*   Including non-equity interests of £80,000 (2002 - £80,000)


**  Net debt excluding debt issue costs/shareholders' funds


D.   Consolidated Cash Flow Statement
     For the year ended 31 March 2003


                                                          2003               2002
                                               £'000     £'000     £'000    £'000
------------------------------------------------------------------------------------

Net cash inflow from operating activities               13,059             30,222
(See note 14a )

Return on investments and servicing
of finance

Interest received                                221                 305
Interest paid                                 (2,770)             (2,862)
Refinancing costs                             (3,294)               (347)
Interest element of finance lease rentals        (15)                (12)
Preference dividends paid                         (6)                 (6)

Net cash outflow from returns on investments
and servicing of finance                      (5,864)             (2,922)

Taxation

UK corporation tax received/(paid)               600                (700)
Overseas tax received/(paid)                   1,779              (3,469)

Tax received/(paid)                                     2,379              (4,169)

Capital expenditure

Purchase of tangible fixed assets             (2,255)             (5,084)
Sale of tangible fixed assets and
current asset investments                        301                 689

Net cash outflow from capital expenditure              (1,954)             (4,395)

Acquisitions and disposals

Purchase of subsidiary undertakings             (279)             (4,015)

Net cash outflow from acquisitions                       (279)             (4,015)

Equity dividends paid                                       -              (6,893)
------------------------------------------------------------------------------------

Cash inflow before financing                            7,341               7,828

Financing
Issue of ordinary share capital                    -                 121
Repayment of loans                            (6,039)               (590)
Capital element of finance lease rentals         (43)               (138)
Net cash outflow from financing                        (6,082)               (607)
------------------------------------------------------------------------------------

Increase in cash in the year                            1,259               7,221
------------------------------------------------------------------------------------

Note 1.  Segment information
                                  External sales      Total sales
Turnover by geographical area     by destination        by source
                                    2003    2002    2003     2002
                                   £'000   £'000   £'000    £'000
-----------------------------------------------------------------
United Kingdom                    42,230  49,529  34,411   64,883
Republic of Ireland                4,078   7,340  46,123   34,648
Other Europe                      38,611  43,026  14,632    9,362
                                 ------- ------- -------  -------
Total Europe                      84,919  99,895  95,166  108,893
The Americas                      87,182 112,391  93,475  117,807
Asia                              57,965  63,410  72,368   76,257
Less:  Inter-divisional                -       - (30,943) (27,261)
-----------------------------------------------------------------
                                 230,066 275,696 230,066  275,696
-----------------------------------------------------------------
Turnover by product category
                                              2003           2002
                                             £'000          £'000
-----------------------------------------------------------------
Data/telecommunications                     96,142        134,897
Powercords                                 101,860        106,437
Harnesses                                   32,064         34,362
-----------------------------------------------------------------
                                           230,066        275,696
-----------------------------------------------------------------
Turnover by market sector
                                              2003           2002
                                             £'000          £'000
-----------------------------------------------------------------
Data/telecommunications                    111,661        152,463
Consumer appliances                         48,914         47,280
Consumer electronics                        38,094         41,875
Vehicle and aerospace                       31,397         34,078
-----------------------------------------------------------------
                                           230,066        275,696
-----------------------------------------------------------------
Operating   profit,  profit  before  tax  and  net   assets   by
geographical area and by class of business are not given as such
disclosure  is  considered  by the  Directors  to  be  seriously
prejudicial to the interests of the Group.

Note 2.  Other operating expenses (net)
                                              2003           2002
Other operating expenses comprise:           £'000          £'000
-----------------------------------------------------------------
Selling and distribution expenses           15,435         15,518
Administrative expenses
     -  goodwill amortisation                  933            871
     -  impairment of goodwill               8,652              -
     -  other                               18,657         17,898
Other operating income                        (594)          (770)
-----------------------------------------------------------------
Other operating expenses (net)              43,083         33,517
-----------------------------------------------------------------

Note 3.  Exceptional operating item
                                              2003           2002
                                             £'000          £'000
-----------------------------------------------------------------
Closure of US facility                           -          1,033
-----------------------------------------------------------------

The  prior  year costs represents the closure of the Group's  US
East  Coast  facility at Dartmouth, Massachusetts  and  all  its
associated costs, which were charged to cost of sales.





Note 4.  Costs of a fundamental restructuring of continuing
operations
                                                2003         2002
                                               £'000        £'000
-----------------------------------------------------------------
Restructuring costs of European/UK operations      -        6,278
-----------------------------------------------------------------

The prior year's cost represents a fundamental restructuring  of
the Group's European power cord and infocom assembly operations.
The  fundamental restructuring occurred because of the  changing
nature    of   its   customers   which   increasingly   comprise
strategically located intermediary EMSs rather than OEMs.

The resultant total cost included the impairment of £1,706,000
of fixed assets.

The tax effect of this exceptional item was £979,000.

Note 5.  Exchange rates

The  principal  exchange rates used in the  preparation  of  the
accounts are:

                          Average      %         Year End        %
                       2003  2002 Change   2003      2002   Change
--------------------------------------------------------------------
United States dollar   1.54  1.44   6.94   1.57      1.42    10.56
Singapore dollar       2.72  2.56   6.25   2.78      2.62     6.11
Euro                   1.54  1.63  (5.52)  1.46      1.63   (10.43)
Canadian dollar        2.39  2.23   7.17   2.30      2.27     1.32
Brazilian real         4.48  3.49  28.37   5.28      3.31    59.52
Swedish krona         14.33 15.00  (4.47) 13.43     14.75    (8.95)
--------------------------------------------------------------------

Note 6.  Finance charges - interest (net)
                                                  2003        2002
Net finance costs represent:                     £'000       £'000
--------------------------------------------------------------------
Income receivable on bank deposits                (221)       (309)

Interest payable on bank loans and overdraft     3,305       3,369
--------------------------------------------------------------------
Finance costs - net                              3,084       3,060
--------------------------------------------------------------------

Note 7.  Finance charges - refinancing costs

Financing  costs of £1,000,000 represents the expenses  incurred
in   the  current  year  on  re-negotiating  the  Group's   bank
facilities with its major lenders (see post balance sheet  event
note 15).

The  prior  year  costs  of £2,260,000 relate  to  the  expenses
incurred  on re-negotiating the Group's bank facilities  in  the
prior year.

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

Note 8.  Finance charges - amortisation of debt issue costs

Amortisation  costs  of £509,000 (2002 -  £nil)  represents  the
amortisation of the debt issue costs capitalised in the year  on
re-negotiating the Group's bank facilities.

Note 9.  Tax on loss on ordinary activities
                                                 2003         2002
The tax credit is based on the
loss for the year and comprises:                £'000        £'000
--------------------------------------------------------------------
Current Tax
UK corporation tax                                434         (231)
Foreign tax                                       516       (2,892)
Adjustments in respect of prior years
Foreign tax                                      (759)      (1,346)
--------------------------------------------------------------------
Total current tax                                 191       (4,469)

Deferred taxation

Origination and reversal of timing
differences                                    (1,139)        (141)
Decrease in estimate of recoverable
deferred tax asset                                  -          703
--------------------------------------------------------------------
Total deferred tax                             (1,139)         562
--------------------------------------------------------------------
Total tax on loss on ordinary activities         (948)      (3,907)
--------------------------------------------------------------------

The  differences between the total current tax shown  above  and
the  amount  calculated  by applying the  standard  rate  of  UK
corporation tax to the loss before tax is as follows:


                                                   2003        2002
                                                  £'000       £'000
--------------------------------------------------------------------
Group loss on ordinary activities before tax    (13,605)    (14,050)
Tax on loss on ordinary activities at
standard UK corporation
tax rate of
30% (2002 - 30%)                                 (4,082)     (4,215)
Effects of:
Expenses not deductible for tax purposes          3,487       2,125
Capital allowances in excess of depreciation        277          93
Timing differences                                  (90)      1,043
Utilisation of tax losses                          (206)       (315)
Higher tax rates on overseas earnings              (287)     (1,854)
Non-utilisation of losses                         1,851           -
Adjustments to tax charge in respect
of previous periods                                (759)     (1,346)
--------------------------------------------------------------------
Group current tax charge/(credit) for the year      191      (4,469)
--------------------------------------------------------------------
Note 10.  Dividends paid on equity
          and non-equity shares                     2003       2002
                                                   £'000      £'000
--------------------------------------------------------------------
Equity shares:
Ordinary dividends
- prior year final dividend on shares
  issued after 31 March
  2002 under share option schemes                      -          6
- interim paid of nil p per share
 (2002 - 5.5p per share)                               -      1,573

Non-equity shares:
Cumulative preference dividends
- interim paid of 3.75p per share
  (2002 - 3.75p per share)                             3          3
- final paid of 3.75p per share
  (2002 - 3.75p per share)                             3          3
--------------------------------------------------------------------
                                                       6      1,585
--------------------------------------------------------------------

Note 11.  Loss per ordinary share
The calculations of loss per share are based on the following
losses and numbers of shares:

                                                    2003         2002
                                                   £'000        £'000
-----------------------------------------------------------------------
Loss for the financial year                      (12,657)     (10,143)
Preference dividends                                  (6)          (6)
-----------------------------------------------------------------------
Basic loss                                       (12,663)     (10,149)

Goodwill amortisation and impairment               9,585          871
Cost of fundamental restructuring                      -        6,278
Finance restructuring costs                        1,000        2,260
Tax on exceptional item                                -       (1,657)
-----------------------------------------------------------------------
Headline loss                                     (2,078)      (2,397)
-----------------------------------------------------------------------

Weighted average number of shares:
                                           No. of Shares  No. of Shares
-----------------------------------------------------------------------
For basic loss per share                      28,602,637     28,592,218

Exercise of share options                              -         11,794
-----------------------------------------------------------------------

For diluted loss per share                    28,602,637     28,604,012
-----------------------------------------------------------------------
Headline loss per share (full)                      (7.3)p         (8.4)p
Basic loss per share (full)                        (44.3)p        (35.5)p
Diluted loss per share (full)                      (44.3)p        (35.5)p

Headline  loss  per share has been calculated on  the  basis  of
continuing  activities  before goodwill  amortisation,  goodwill
impairment,  exceptional  restructuring  costs  and  exceptional
refinancing  costs  in  each case net  of  tax.   The  directors
consider  that this gives a better understanding of the  Group's
loss  in  the year and the prior year.  As the Group recorded  a
loss for the financial year the share options are anti dilutive.


Note 12.  Reconciliation of Movements in Consolidated Shareholders' Funds

                                             2003      2002
                                            £'000     £'000
--------------------------------------------------------------
Loss for the financial year               (12,657)  (10,143)
Dividends paid - see note 10                   (6)   (1,585)
--------------------------------------------------------------
Loss for the year transferred
from reserves                              (12,663) (11,728)
Unrealised deficit on revalued
freehold and leasehold buildings            (1,419)       -
Currency variations                           (100)    (695)
New share capital subscribed                     -      121
--------------------------------------------------------------
Net decrease in shareholders' funds        (14,182) (12,302)
Opening shareholders' funds                 59,315   71,617
--------------------------------------------------------------
Closing shareholders' funds                 45,133   59,315
--------------------------------------------------------------

Note 13.  Goodwill
                                                       £'000
--------------------------------------------------------------
Cost
Beginning of year                                     16,399
Additions                                                 97
Exchange adjustment                                    (259)
--------------------------------------------------------------
End of year                                           16,237
--------------------------------------------------------------
Amortisation
Beginning of year                                      2,334
Charge for the year                                      933
Impairment losses                                      8,652
Exchange adjustment                                     (56)
--------------------------------------------------------------
End of year                                           11,863
--------------------------------------------------------------
Net book value - end of year                           4,374
Net book value - beginning of year                    14,065
--------------------------------------------------------------
The  impairment charge of £8,652,000 is in relation to  goodwill
recognised on the Group's Brazilian subsidiary, Volex do  Brasil
Ltda, which has been written down to its recoverable amount.
--------------------------------------------------------------

Note 14.  Consolidated cash flow statement

a. Reconciliation of operating                     2003    2002
   loss to net cash inflow
   from operating activities                      £'000   £'000
-----------------------------------------------------------------
Operating loss                                   (9,012) (2,452)
Depreciation charges                              6,758   8,517
Goodwill amortisation and impairment              9,585     871
Government grants                                  (128)   (434)
Loss/(profit) on sale of tangible fixed assets        5    (258)
Decrease in stocks                                5,793  23,698
(Increase)/decrease in debtors                   (2,664) 19,735
Increase/(decrease) in creditors                  5,058 (17,480)
Cash impact of fundamental restructuring         (2,336) (1,975)
-----------------------------------------------------------------
Net cash inflow from operating activities        13,059  30,222
-----------------------------------------------------------------

b. Analysis of net debt:
                       1 April           Other Non-cash    Exchange   31 March
                          2002 Cash Flow        Changes    Movement       2003
                         £'000     £'000          £'000       £'000      £'000
-----------------------------------------------------------------------------------
Cash at bank and                  -------
in hand                 13,090     1,369              -        (731)    13,728
Overdraft               (2,827)     (110)             -         181     (2,756)
                                  -------
                                   1,259

Debt due after                    -------
one year               (60,563)    6,039          1,035       4,773    (48,716)
Debt due within one year     -         -         (1,035)          -     (1,035)
Finance Leases            (109)       43              -          41        (25)
                                  -------
                                   6,082
-----------------------------------------------------------------------------------
Net debt               (50,409)    7,341              -       4,264    (38,804)
-----------------------------------------------------------------------------------







                                                   2003     2002
c. Reconciliation of net cash flow
   to movement in net debt:                       £'000    £'000
--------------------------------------------------------------------
Increase in cash in the year                      1,259    7,221
Cash outflow from decrease in
debt & lease financing                            6,082      728
--------------------------------------------------------------------
Change in net debt resulting from cash flows      7,341    7,949
New finance leases                                    -     (242)
Translation difference                            4,264      297
--------------------------------------------------------------------
Movement in net debt in the year                 11,605    8,004
Net debt at 1 April 2002                       (50,409)  (58,413)
--------------------------------------------------------------------
Net debt at 31 March 2003                      (38,804)  (50,409)
--------------------------------------------------------------------

Note 15.  Post balance sheet event

Since the year-end, the Company has completed the re-negotiation
of  the  terms  of its borrowing facilities with  its  principal
bankers  (Barclays Bank PLC, Fleet National Bank and Royal  Bank
of  Scotland  PLC).  Amendments to certain terms  and  financial
covenants  as  previously set out in the prior  year's  facility
agreement  now provide for the continuation of these  facilities
until 30 June 2004, with the Company having the option to extend
for   a  further  year  subject  to  meeting  certain  specified
conditions. The Company's facilities continue to be provided  on
a secured basis with a margin increase of 100 basis points (1%).

In  addition, the exercise price of the previously issued option
warrants  for 5% of the Company's issued ordinary share  capital
is  to  be  adjusted to be set at a 25% premium to  the  average
share  price over the 30 day period starting 5 June  2003.   The
banks  will  have  the  opportunity to exercise  these  warrants
between  July  2003  and 30 June 2005, with  this  period  being
extended until 30 June 2007 to the extent that each bank remains
a committed lender to the Group during this extension period.

The  Company  considers  that the re-negotiated  facilities  are
adequate  for  its working capital purposes in  the  foreseeable
future.

Note 16.  Miscellaneous

(i)   The  current  and  prior  year  results  set  out  in  this
      announcement are non-statutory accounts within the  meaning
      of Section 240 of the Companies Act 1985.

(ii)  The  results for the year ended 31 March 2003 are  extracts
      from the 2003 Group accounts which, if adopted by members in
      General Meeting on 29 July 2003 will be filed with the Registrar
      of Companies.
      The auditors have reported on these accounts; their reports
      were  unqualified  and  did  not contain  statements  under
      S237(2) or (3) Companies Act 1985.

(iii) The  results  for the year ended 31  March  2002  are
      extracts from the 2002 Group statutory accounts, which have been
      reported upon without qualification by the auditors and have
      been delivered to the Registrar of Companies.

(iv)  The  preliminary announcement has been prepared  using  the
      accounting policies stated in the Annual Report and Accounts for
      the period ended 31st March 2003.



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