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Xansa PLC (XAN)

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Wednesday 26 June, 2002

Xansa PLC

Final Results - Replacement

Xansa PLC
26 June 2002



The issuer advises that the following replaces the preliminary results
announcement released on Wednesday 26 June 2002 at 0700 hours under RNS number
7554X.

Under Note 2 to the Accounts, the shareholder registration date for the final
dividend and the date of the ex-dividend were incorrectly written as 2001: both
dates have been amended to read 2002.

All other details remain unchanged.  The full, amended text appears below.



Wednesday 26 June 2002

                                   XANSA PLC

                     PRELIMINARY RESULTS ANNOUNCEMENT

                     FOR THE YEAR ENDED 30 APRIL 2002


Xansa is a company that transforms the business capability of its clients
through its expertise in Business Consulting, Information Technology,
Outsourcing and Business Process Management.  The company's operations cover the
UK, North America, Continental Europe, India and Asia-Pacific.



Key Features

•         Turnover up 18% to £515.1m (2001: £434.7m)
•         Operating profit up 9% to £49.1m (2001: £45.2m*)
•         Operating margin decreased to 9.5% (2001: 10.4%*)
•         Profit before tax up 10% to £46.5m (2001: £42.2m*)
•         EBITDA up 7% to £57.1m (2001: £53.6m*)
•         Goodwill impairment of £497m
•         Exceptional costs of £13.2m for the restructuring exercise
•         Diluted earnings per share down 2.23p to 7.55p (2001: 9.78p*)
•         Dividend per share of 3.24p (2001: 3.24p)
•         Cash flow from operating activities up 136% to £56.0m (2001: £23.7m*)
•         Net borrowings down 52% to £10.9m (2001: £22.8m*)


All the above figures are quoted before profit on sale of own shares,
distribution of shares from the trusts, reorganisation costs and goodwill
amortisation and impairment.


* Restated for the effects of the UITF Abstract 32 (Urgent Issues Task Force
Abstract 32 - Employee Benefit Trusts and other intermediate payment
arrangements).

•         Orderbank down 1% to £518m (2001: £523m)
•         Major new deals:
          •         Barclays, for £140m over 5 years
          •         Boots, for £28m over 2 years
          •         Diageo, for £21m over 3 years
•         Systems Integration (including FBS and Xansa, India) turnover
          increased by 14%
•         Enterprise Solutions (excluding Synergy) turnover increased by 60%
•         Business Change turnover decreased by 22%
•         Xansa Recruitment turnover increased by 39%


Commenting on the results, Hilary Cropper CBE, Executive Chairman said:

"The year has been challenging as a result of the market downturn, which has
proved longer and deeper than any of us expected, and consisted of two
contrasting halves.  The year for Xansa started out strongly, producing turnover
growth in the first half of 32% and with trading results at the operating level
increasing by 49% against the comparable period.  However, there was a marked
slowdown in discretionary spend across most of our client base in the second
half resulting in a down-grading of expectations and a restructuring of the cost
base on an international basis.

"One cannot control external events, only anticipate and respond to them in the
most timely manner, and in this respect Xansa has fared better than most of its
peers whilst simultaneously establishing the foundations for future growth.  The
pipeline for further orders both in the UK and internationally, remains strong
and includes a number of large outsourcing prospects for both IT and business
process contracts.  Nevertheless, we remain cautious about the economic
environment and do not expect a significant upturn in IT spending before the
start of calendar 2003 at the earliest.

"The company has weathered the difficult market situation relatively well.  It
has been restructured to align the cost base to reflect the current outlook, has
a strong cash flow profile and a low level of debt.  The management team is
determined, is confident in the business, and we start the year in good shape."


                               ENDS


Contact: Steve Stratton                              Giles Sanderson, Ben Atwell
Investor Relations Director, Xansa                   Financial Dynamics
Tel : + 44 (0) 8702 416181                           Tel : + 44 (0) 20 7831 3113
Email : steve.stratton@xansa.com


Chairman's Statement

In my last statement to you as Executive Chairman, before becoming non-executive
Chairman on 1 August 2002, I have to report on a year that has been challenging
as a result of the market downturn, which has proved longer and deeper than any
of us expected.  One cannot control external events, only anticipate and respond
to them in the most timely manner, and in this respect Xansa has fared better
than most of its peers whilst simultaneously establishing the foundations for
future growth.

The year for Xansa started out strongly, producing turnover growth in the first
half of 32% and with trading results at the operating level increasing by 49%
against the comparable period.  Although the economy was tightening, with some
softening in demand for consultancy services, we firmly believed that our
business model would allow us to overcome this downturn, with strong growth in
the AXA Sun Life contract, First Banking Systems and Enterprise Solutions.

However, post 11 September there was a marked slowdown in discretionary spend
across most of our client base resulting in a down-grading of expectations and a
restructuring of the cost base on an international basis.  This involved some
350 redundancies along with a reduction of 184 contractors.  We are deeply sorry
that we had to take this action, which we implemented as sensitively as
possible.  No organisation likes to carry out redundancy programmes, but for a
company like Xansa, which places so much emphasis on employees and their
welfare, it is particularly saddening.  It is 12 years since Xansa was forced to
undertake a redundancy programme, in that case also as a direct result of
economic downturn.  In the current situation the weakening economy has been felt
across all of Xansa's international markets.

In this year of contrasts there has been spectacular progress in expanding the
Xansa business model.  We launched the new Business Process Management business
unit with BT as its foundation client; created a joint business venture with
Barclays to provide strategic development services to Barclaycard; and grew our
international business, by source, by some 50% year-on-year.  Synergy
International, which we acquired in April 2001, has delivered an excellent
performance, exceeding the targets set at the time of acquisition, and from
January this year has been fully integrated into the Xansa brand and operations
in the USA.

We were also pleased to announce the appointment of Alistair Cox who will become
Xansa's new Chief Executive from 1 August 2002.  I shall move to the position of
non-executive Chairman at that time and will continue to devote significant time
to Xansa, especially during the first year, to ensure a smooth transition.  I am
delighted that we have been able to attract someone of Alistair Cox's calibre to
this role.   He joins Xansa from Lafarge, where for the last four years he has
been their Regional President in Asia, responsible for operations in six
countries.  An engineer by background, his early business experience was with
British Aerospace and Schlumberger in the UK and USA.  Having obtained an MBA
from Stanford Graduate School of Business in 1991, he joined McKinsey & Co where
he gained broad international experience across a number of industries including
information technology, energy and utilities, and consumer goods.

Alistair's management and consulting experience and his deep knowledge of many
of Xansa's market sectors give him an excellent background for taking the
company forward.


Financial Results

•         Turnover up 18% to £515.1m (2001: £434.7m)
•         Operating profit up 9% to £49.1m (2001: £45.2m*)
•         Operating margin decreased to 9.5% (2001: 10.4%*)
•         Profit before tax up 10% to £46.5m (2001: £42.2m*)
•         EBITDA up 7% to £57.1m (2001: £53.6m*)
•         Goodwill impairment of £497m
•         Exceptional costs of £13.2m for the restructuring exercise
•         Diluted earnings per share down 2.23p to 7.55p (2001: 9.78p*)
•         Dividend per share of 3.24p (2001: 3.24p)
•         Cash flow from operating activities up 136% to £56.0m (2001: £23.7m*)
•         Net borrowings down 52% to £10.9m (2001: £22.8m*)
•         Orderbank down 1% to £518m (2001: £523m)

All the above figures are quoted before profit on sale of own shares,
distribution of shares from the trusts, reorganisation costs and goodwill
amortisation and impairment.

* Restated for the effects of the UITF Abstract 32 (Urgent Issues Task Force
Abstract 32 - Employee Benefit Trusts and other intermediate payment
arrangements)


As you will see in the business performance section, increased contributions
from the Systems Integration and Enterprise Solutions business units have been
offset by reductions in Business Change and Xansa Recruitment and by investment
in the establishment of the Business Process Management unit as well as
increased investment in North American management and sales teams.  Margins at
the operating level were impacted by the performance in Business Change and
deteriorated to 9.5% from 10.4%.

During the year we have continued the significant trends in the improvement in
cash flow, resulting in net borrowings reducing to £10.9m from £22.8m.  This has
been the result of a continuing focus on cash management that has resulted in a
reduction of debtors, whilst revenues have grown by 18% and normally working
capital would have been expected to rise.

Exceptional costs to cover the restructuring exercise totalled £13.2m, almost
all of which fell in the second half.  This sum was higher than initially
planned due to the high cost of actual redundancies, particularly in the
Business Change area and also in Europe.

As a result of UITF 32, which became effective in December 2001, we have had to
recognise and bring on to the balance sheet the Xansa Employee Trust.  The
Trust, established in 1981, is for the benefit of the employees and is
independent of the company.  The impact is to increase profit before tax by
£1.6m in 2002 and £2.8m in 2001.  Xansa shares held by the Trust came on to the
balance sheet at a value of £6.5m in 2002 (£4.3m in 2001), and 24.5m shares held
by the Employee Trust were excluded from earnings per share, raising diluted
earnings per share from 7.09p to 7.55p.


Goodwill Impairment

The performance of Enterprise Solutions, formerly Druid, has been consistent
with expectations and, as can be seen later in this report, has significantly
improved its performance during the year.  It is also an increasingly important
component of Xansa's integrated offering and a number of outsourcing contracts
have been and continue to be dependent on it.  However, since we acquired Druid
in March 2000, in an all-share transaction at an average share price of 807p
that valued the company at £725m, asset values in the technology sector have
fallen dramatically.  The Board has reviewed the carrying value of the goodwill,
arising from the acquisitions of Druid, Synergy and OSI.  The review concluded
that it was only necessary to impair goodwill in respect of Druid, as this was
the only acquisition where forward values of cash flow projections relative to
the current carrying value meant that a write off of £497m was thought
necessary. After this impairment, £261m of goodwill remains on the balance
sheet.



Business Performance

Orders in the year totalled £510m producing an order bank of £518m, an increase
of £76m on the half year position but a decrease of £5m on the position at the
end of the previous financial year, reflecting the overall downturn in the
economic environment, throughout most of the period.

Large orders won during the year include £139.7m from Barclays, £27.6m from
Boots, £21.4m from Diageo, £16.7m from a UK Government department, £16.2m from
Tesco, £14.4m from a major chemical company, £14.3m from HBOS, £10.6m from Legal
& General and £10.0m from the Department for Education and Skills (DfES).

Business Change, which has been the business most affected by the down-turn in
the economy, saw turnover drop by 22% to £72.2m (2001: £92.9m) and its operating
profit drop by 86% to £1.8m (2001: £13.4m).  It also bore the brunt of
redundancies in the UK, USA and Europe, with a total reduction of 153 people.
The strategic rationale for this unit remains as strong as ever.  Business
Change is now working for 22 of Xansa's top 30 clients, and is essential to
successful delivery of major programmes with some of our largest clients such as
AXA Sun Life, HBOS, Barclaycard, Marks & Spencer and the Learning and Skills
Council.

Enterprise Solutions continued its impressive growth with turnover (excluding
Synergy) up 60% to £75.6m (2001: £47.2m) and with its operating profit up to
£8.3m (2001: £0.6m).  Including Synergy, turnover was up 102% to £97.2m (2001:
£48.0m).  Synergy's performance was equally strong, despite the impact of 11
September on the Aerospace & Defence sector, delivering turnover of £21.6m and
operating profit of £2.9m. Enterprise Solutions has begun to develop significant
international clients such as Diageo, CHEP and Goodrich, where our people are
working in the UK, USA and Europe. It is also developing a significant
consulting and SAP implementation relationship with Boots as a strategic
partner.

The total Systems Integration business, which includes First Banking Systems and
almost all of our operation in India, increased turnover by 14% to £290.8m
(2001: £254.3m).  The first year of the AXA Sun Life contract was delivered to
plan for both the client and Xansa.  The Barclays joint business venture, worth
£125m over five years, was successfully initiated in February with around 450
people transferring from Barclaycard.  However, we were sorry to lose the
re-tendering of the contract with DfES that resulted in a reverse transfer of
undertaking involving 106 people.

Xansa Recruitment increased external turnover by 39% to £54.9m (2001: £39.5m)
which we believe is a very strong performance given the weak market for
contractors.  During the year we reversed our decision to enter the permanent
recruitment market and initiated a sales efficiency drive across the whole unit.
We have invested heavily in "e"-enabling the recruitment processes and
although performance was less strong in the second half, demand now appears to 
have stabilised with growth clients established at Legal & General, Standard 
Life and DHL.

The new business unit to develop Business Process Management (BPM) was launched
in October 2001 on the back of the joint announcement with BT of their intention
to outsource key accounting and financial services to Xansa.  A strong
management team has already been established in both the UK and India and a
pipeline of opportunities is being developed in the finance and accounting
arena.

We are designing a Shared Service fully "e"-enabled Accounting and Financial
Services offering based on the BT software and are developing and simultaneously
researching possible entries into other areas of Business Process Outsourcing
(BPO) applicable to Xansa's chosen market sectors.

There have been no significant changes within our market sectors, other than to
Utilities and Telecommunications - a reflection of those general markets. The
growth in Aerospace & Defence is as a result of the acquisition and favourable
performance of Synergy.

•         Banking up 17% to £171.5m (2001: £146.1m)
•         Insurance up 89% to £76.5m (2001: £40.4m)
•         Retail up 3% to £71.4m (2001: £69.6m)
•         Utilities down 25% to £58.6m (2001: £78.3m)
•         Government up 46% to £47.4m (2001: £32.5m)
•         Telecommunications down 16% to £37.9m (2001: £45.1m)
•         Aerospace & Defence up 191% to £28.2m (2001: £9.7m)
•         Pharmaceuticals up 82% to £23.6m (2001: £13.0m)

Our international capabilities are increasingly important for the long-term
future of Xansa as our client base follows the global trend.  We are very
pleased that, despite the restructuring we have undertaken during the year,
business outside the UK (by source) has increased by 50% to £96.2m (2001:
£64.1m).  The technology centres in India are progressing according to plan, and
we continue to deliver work to our major customers worldwide.  International
organic growth was 18%, the remainder representing the impact of the Synergy
acquisition in the USA.  International clients now represent seven of Xansa's
top 30 clients.


Events Since Period Close

Two significant events have taken place since the period end, neither of which
is reflected in the stated order bank.

The first is the signing of a major new contract with BT to provide most of
their key financial and accounting services, which is worth £250m over a
seven-year period.  This contract was signed at the end of May and the operation
will transfer to Xansa on 1 July 2002.  We are delighted to welcome the 570
people who will join us from BT on that date.  They will form the cornerstone of
our business in the BPO market that is forecast to exceed the IT outsourcing
market within the next 10 years.

This deal was possible because it aligned our capabilities with BT's stated
strategy of maximising shareholder value by focusing on its core
telecommunications business.  Xansa was chosen not only because of the cost
savings - guaranteed at £93 million across the seven years - but also because of
the service quality it will provide to BT.

The second is the decision by HBOS to give notice to First Banking Systems
(FBS), our original joint venture with the Bank of Scotland, to conclude its
contract with effect from December 2003.  In December 2003, HBOS will pay around
£9m to Xansa as compensation for early termination representing loss of
anticipated profit for the 18 months beyond December 2003.  The current FBS
contracted order bank as at 30 April 2002 stands at £187m.  The effect of the
early conclusion of the venture will be to reduce the FBS contracted order bank
by £91m. During the 18-month notice period, FBS will continue to deliver work to
HBOS in line with their agreed business plan and the remaining order bank.

It is very disappointing that so successful a venture is being brought to a
close. However the model of a centralised strategic IT development partnership
simply does not fit the HBOS federated structure.  The contract terms were
designed to protect Xansa's commercial position that means we are in line with
earning expectations this year.  The results for 2004 will be enhanced by the
cash termination payment.  I want to thank all the teams in FBS for the
excellent work they have done since the formation of FBS in 1998.  They have
constantly either met or exceeded targets in a challenging environment and
should be proud of their achievements.  They have my assurance that through the
changes ahead we shall look after them to the best of our ability.


Other Board Changes

In May we were pleased to announce the appointment of Consuelo Brooke as a
non-executive Director.  Consuelo retired as a Managing Director of Merrill
Lynch Investment Managers at the end of last year.  Prior to this, she was a
Director and Deputy Chairman of Mercury Asset Management Holdings and a Director
of Warburg Investment Management.

I always enjoyed my meetings with Consuelo in the days when she was representing
institutional investors to Xansa and found them challenging, and I look forward
to her contribution as a colleague on the Xansa Board.

As previously mentioned at the Interims, we welcomed David Thomas as a
non-executive Director, and announced the retirement of Sir Kit McMahon.



Dividend

The Board is recommending a final dividend of 2.16p, which along with the
interim dividend of 1.08p gives a total dividend for the year of 3.24p, which is
unchanged on last year.


Employee Share Ownership

Employee share ownership remains a key part of Xansa's culture of shared success
and individual commitment and this year saw the launch of Xansa's innovative All
Employee Share Ownership Plan (AESOP) with a mix of free shares, partnership and
matching shares.  This new Plan has enabled us to extend the share schemes on an
international basis allowing Xansa to maintain its high level of employee share
ownership.

Xansa's AESOP was launched in August 2001 with a grant of £3,000 worth of free
shares to all UK employees.  At the year end, 51% of UK employees participated
in the AESOP facility of having regular monthly deductions made from salary to
buy Partnership shares.

On 30 April 2002, the employees, together with the employee trusts, held 28% of
the company's shares compared to 30% on 30 April 2001.


Community

Xansa continues to believe in supporting the communities in which it operates
through a programme that focuses on youth homelessness and education.  Xansa
remains committed to spending up to one per cent of profit before tax on
investing in the community.

The community investment programme has been shown to be good for the community
and the people of Xansa as they achieve personal satisfaction, personal
development and professional development through volunteering and this in turn
is good for Xansa.

As Xansa works in many diverse geographies so the volunteering programmes have
expanded internationally.  Xansa supports such programmes as Business Action on
Homelessness in the UK, a campaign to raise corporate support for homeless
agencies and their clients, and in India Xansa has launched Literacy@Home a
programme supporting the Indian government's campaign to raise adult literacy
levels.  The internationalisation of the programme is being further expanded
through a worldwide employee challenge, launched in June 2002, to have a
community event happening somewhere in Xansa on each day of October.  This
challenge will enable employees and Xansa to demonstrate their commitment to
their communities across the world.


Environment

Xansa recognises the need to monitor and report on the environmental impact of
its business.  Supplier management procedures have been revised to include an
assessment of the environmental impact of potential suppliers and their
products.

Xansa again reported on its performance in the Index of Corporate Environmental
Engagement, an annual report of Business in the Environment, covering the
environmental performance of UK-based companies.


AGM

The AGM will be held at the Queen Elizabeth II Conference Centre, London, SW1P
3EE, at noon on Wednesday 18 September 2002.


Outlook

The company has weathered the difficult market situation relatively well. It has
been restructured to align the cost base to reflect the current outlook, has a
strong cash flow profile and a low level of debt.  The management team is
determined, is confident in the business, and we start the year in good shape.

The pipeline for further orders, both in the UK and internationally, remains
strong and includes a number of large outsourcing prospects for both IT and
business process contracts.  Nevertheless, we remain cautious about the economic
environment and do not expect a significant upturn in IT spending before the
start of calendar 2003 at the earliest.

We expect a degree of margin dilution in the current year as large contracts,
such as BT and Barclaycard, replace decreases in previously mature ones, such as
FBS and DfES.  It is normal for large contracts to require investment in the
early stages. We also intend to continue our investment internationally and in
the new business area, BPO, to ensure a platform for continued future growth.

During the 15 years in which I have been privileged to be Xansa's Chief
Executive, and subsequently Executive Chairman, we have grown from an £11m
turnover, privately owned, project-based business into an integrated consultancy
and outsourcing company, publicly listed, operating in 11 countries, with
turnover in excess of £0.5 billion.  This result has been achieved by everyone
in the company working together across the world, driven by the values of
participation, partnership and shared success which are essential elements of
the Xansa brand. I should like to say thank you to all my colleagues for one of
the best times of my life.

Alistair Cox joins as Chief Executive at a time when Xansa, as a thriving
independent business, has better opportunities than ever.  I am confident that
he will lead the company to even greater heights and know that he inherits the
best people in the world with whom to work.  In my move to part-time
non-executive Chairman, I am looking forward immensely to working with Alistair,
the Board and all the people in Xansa to ensure continued growth in value and
contribution for our shareholders, our clients, everyone in the company and the
communities in which we live.



Hilary Cropper CBE
Executive Chairman



Consolidated profit and loss account
For the year ended 30 April 2002

                                                                       2002           2002        2002        2001
                                                                     Before    Exceptional       Total         (as
                                                                exceptional          items               restated)
                                                                      items
                                                    Note           £million       £million    £million    £million

Turnover:
Group including share of joint venture's turnover   3                 515.1              -       515.1       434.7
Less: share of joint venture's turnover                                   -              -           -      (43.4)
Group turnover                                                        515.1              -       515.1       391.3
Group operating profit (loss):
Before profit on sale of own shares, distribution   3                  49.1              -        49.1        37.0
of shares from the trusts, reorganisation costs and
goodwill amortisation and impairment
Profit on sale of own shares                                            1.6              -         1.6         2.9
Distribution of shares from the trusts                                (3.1)              -       (3.1)           -
Reorganisation costs                                                      -         (13.2)      (13.2)           -
Goodwill amortisation and impairment                                 (42.6)        (497.0)     (539.6)      (41.6)
                                                                        5.0        (510.2)     (505.2)       (1.7)
Share of operating profit in:
Joint venture                                                             -              -           -         8.0
Associate                                                                 -              -           -         0.2
Total operating profit (loss): Group and share of   3                   5.0        (510.2)     (505.2)         6.5
joint venture and associate
Net interest payable                                                  (2.6)              -       (2.6)       (3.0)
Profit (loss) on ordinary activities before                             2.4        (510.2)     (507.8)         3.5
taxation
Profit (loss) on ordinary activities before
taxation analysed between:
Before profit on sale of own shares, distribution                      46.5              -        46.5        42.2
of shares from the trusts, reorganisation costs and
goodwill amortisation and impairment
Profit on sale of own shares                                            1.6              -         1.6         2.9
Distribution of shares from the trusts                                (3.1)              -       (3.1)           -
Reorganisation costs                                                      -         (13.2)      (13.2)           -
Goodwill amortisation and impairment                                 (42.6)        (497.0)     (539.6)      (41.6)
                                                                        2.4        (510.2)     (507.8)         3.5
Taxation                                            4                (14.8)            3.1      (11.7)      (13.2)
Loss on ordinary activities after taxation                           (12.4)        (507.1)     (519.5)       (9.7)
Equity minority interests                                                                        (8.6)       (0.5)
Loss attributable to shareholders                                                              (528.1)      (10.2)
Dividends                                           2                                           (10.2)       (9.3)
Transfer from reserves                                                                         (538.3)      (19.5)


                                                                                                  2002         2001

                                                    Note                                                        (as
                                                                                                           restated)
Earnings per share - before profit on sale of own
shares, distribution of shares from the trusts,
reorganisation costs and goodwill amortisation and
impairment
- basic                                             5                                            7.76p        10.19p
- diluted                                           5                                            7.55p         9.78p
Loss per share
- basic                                             5                                        (184.66p)       (3.68p)
- diluted                                           5                                        (184.66p)       (3.68p)

All the results above relate to continuing activities.


Statement of total recognised gains and losses
For the year ended 30 April 2002

                                                                                            2002            2001

                                                                                                              (as
                                                                                                        restated)
                                                                             Note       £million         £million

Loss for the financial year excluding share of profits of joint venture                  (528.1)           (16.2)
and associate
Share of joint venture's profit for the year                                                   -              5.9
Share of associate's profit for the year                                                       -              0.1
Loss attributable to shareholders                                                        (528.1)           (10.2)
Exchange differences on retranslation of net assets of subsidiary                          (1.1)            (0.1)
undertakings
Unrealised gain on recognition of the QUEST                                                    -             43.8
Tax charge on gift of shares from the QUEST                                                (0.6)                -
Total recognised gains and losses relating to the                                        (529.8)             33.5
year
Prior period adjustment                                                      11              4.9
Total gains and losses recognised since the last                                         (524.9)
annual report


Consolidated balance sheet
As at 30 April 2002

                                                                                         2002              2001
                                                                                                            (as
                                                                                                      restated)
                                                                         Note        £million          £million

Fixed assets
Intangible assets                                                                       261.3             800.9
Tangible assets                                                                          24.5              22.2
Investment in own                                                                        58.2              59.4
shares
                                                                                        344.0             882.5
Current assets
Debtors                                                                  6               89.6              92.2
Cash at bank and in hand                                                                 28.3              24.4
                                                                                        117.9             116.6
Creditors due within one year
Short term                                                                             (21.0)            (23.9)
borrowings
Other creditors                                                          7             (97.6)            (89.8)
                                                                                      (118.6)           (113.7)
Net current (liabilities) assets                                                        (0.7)               2.9
Total assets less current liabilities                                                   343.3             885.4
Long term borrowings                                                                   (18.2)            (23.3)
Provisions for liabilities and charges                                                  (1.3)             (1.2)
Net assets                                                               3              323.8             860.9

Capital and reserves
Called up share capital                                                                  16.4              16.3
Shares to be issued                                                                       9.5               8.9
Share premium account                                                                    54.0              51.1
Merger reserve                                                                          760.3             760.3
Other reserve                                                                            40.6              43.8
Profit and loss account                                                               (558.1)            (20.7)
Total equity shareholders' funds                                                        322.7             859.7
Minority Interests
Equity interests in subsidiary undertakings                                               1.1               1.2
                                                                                        323.8             860.9


Consolidated cash flow statement
For the year ended 30 April 2002

                                                                   2002         2002             2001              2001
                                                                                                  (as               (as
                                                                                            restated)         restated)
                                                   Note        £million     £million         £million          £million

Cash inflow from operating                         8                            56.0                               23.7
activities

Dividends from joint venture                                                       -                                2.7

Returns on investments and servicing of finance
Dividends paid to minority                                        (7.4)                             -
interests
Interest received                                                   0.8                           0.3
Interest paid                                                     (3.8)                         (3.9)
Interest element of finance lease rental payments                 (0.1)                         (0.1)
                                                                              (10.5)                              (3.7)

Taxation
Corporation tax paid                                             (15.8)                         (8.9)
Return of overpayment                                                 -                           0.9
                                                                              (15.8)                              (8.0)
Capital expenditure and financial
investment
Payments to acquire tangible fixed                               (10.2)                         (8.7)
assets
Receipts from sale of tangible fixed assets                         0.2                           1.0
Payments to acquire own shares                                    (2.9)                         (3.5)
Receipts from sale of own shares                                    2.7                           3.5
                                                                              (10.2)                              (7.7)
Net cash inflow before financing                                                19.5                                7.0
Acquisitions
Payments to acquire investments in subsidiaries                   (0.9)                         (2.4)
Cash acquired on recognition of the QUEST                             -                           0.1
Net cash acquired with subsidiary undertakings                        -                          15.3
                                                                               (0.9)                               13.0
Equity dividends paid                                                          (8.0)                              (6.0)
Cash inflow before management of liquid resources                               10.6                               14.0

Management of liquid resources
Withdrawal of short term deposits                                   3.7                           0.2
Placement of short term deposits                                  (6.2)                         (0.1)
                                                   9                           (2.5)                                0.1
Financing
Issue of ordinary share capital                                     1.3                           2.3
New borrowings                                     9               38.6                           8.0
Repayment of borrowings                            9             (50.3)                        (15.8)
Capital element of finance lease rental payments   9              (0.3)                         (0.3)
                                                                              (10.7)                              (5.8)
(Decrease) increase in cash at bank and in hand    10                          (2.6)                                8.3



Notes to the Accounts

1  General

The results for the year ended 30 April 2002 and 2001 are extracted from the
audited accounts of Xansa plc on which the auditors have issued an unqualified
opinion which did not contain a statement under Section 237 (2) or (3) of the
Companies Act 1985.  The preliminary announcement was approved by the Board on
25 June 2002 and has been prepared on a basis consistent with the 2002 Annual
Accounts.

The audited accounts for the year ended 30 April 2001 have been delivered to the
Registrar of Companies.  The Annual Report and Accounts for the year ended 30
April 2002 will be posted to shareholders in early August and will be delivered
to the Registrar of Companies following the Annual General Meeting which will be
held at 12.00 noon on Wednesday 18 September 2002 at the Queen Elizabeth II
Conference Centre, London, SW1P 3EE.  Copies may be obtained from the Group's
registered office: Campus 300, Maylands Avenue, Hemel Hempstead, Hertfordshire
HP2 7TQ.


2  Dividends

The total dividend of 3.24p per share (2001: 3.24p) comprises an interim
dividend of 1.08p per share which was paid on 12 April 2002 and a final dividend
of 2.16p which will be paid on 1 October 2002, if approved, to shareholders on
the register at 12 July 2002.  The ex-dividend date will be 10 July 2002.

3  Segmental analysis

The Directors consider that the Group operates in one continuing class of
business namely that of computer software and related support services.

                                                                         Operating      Operating   Net assets
                                         Turnover by    Turnover by         profit         (loss)     employed
                                                                         (loss) by      profit by
                                         destination         source        source*         source    by source
                                                2002           2002           2002           2002         2002
                                            £million       £million       £million       £million     £million
Geographic analysis
United Kingdom                                 451.1          418.9           39.0        (511.5)        284.7
India                                            0.6           31.7           11.5           11.5          5.2
United States of America                        44.2           43.8          (1.0)          (2.6)         26.3
Rest of the World                               19.2           20.7          (0.4)          (2.6)          6.5
                                               515.1          515.1           49.1        (505.2)        322.7
Minority interests                                 -              -              -              -          1.1
                                               515.1          515.1           49.1        (505.2)        323.8

                                                2001           2001           2001           2001         2001
                                                                               (as            (as          (as
                                                                         restated)      restated)    restated)
                                            £million       £million       £million       £million     £million
Geographic analysis
United Kingdom                                 342.1          327.2           33.5          (5.2)        822.7
India                                            2.5           21.6            2.8            2.8          7.9
United States of America                        30.2           30.3            0.8            0.8         25.2
Rest of the World                               16.5           12.2          (0.1)          (0.1)          3.9
                                               391.3          391.3           37.0          (1.7)        859.7
Joint venture                                   43.4           43.4            8.0            8.0            -
Associate                                          -              -            0.2            0.2            -
Minority interests                                 -              -              -              -          1.2
                                               434.7          434.7           45.2            6.5        860.9

* Before profit on sale of own shares, distribution of shares from the trusts,
reorganisation costs and goodwill amortisation and impairment

In accordance with FRS 9, the Group's turnover includes £nil (2001:
£32.8million) billed to the joint venture for the supply of services.



4  Taxation
                                                                                          2002             2001
                                                                                                            (as
                                                                                                      restated)
                                                                                      £million         £million
Tax on (loss) profit on ordinary activities
The charge for the year comprises:
Current tax
UK corporation tax                                                                        10.6             10.1
Adjustments in respect of prior years                                                    (0.3)              0.1
                                                                                          10.3             10.2
Foreign tax                                                                                  -              0.4
Adjustments in respect of prior years                                                    (0.1)                -
Total current tax                                                                         10.2             10.6
Deferred tax
Origination and reversal of timing differences                                             1.5                -
Total deferred tax                                                                         1.5                -
Share of joint venture taxation                                                              -              2.5
Share of associate taxation                                                                  -              0.1
Total tax on (loss) profit on ordinary activities                                         11.7             13.2



5  Earnings per share

                                                                                     2002                          2001
                                                                                                                    (as
                                                                                                              restated)
                                                                                 £million                      £million
(Loss) earnings
Loss attributable to shareholders as used to calculate basic and diluted loss     (528.1)                        (10.2)
per share
Profit on sale of own shares                                                        (1.6)                         (2.9)
Exceptional items net of tax                                                        507.1                             -
Distribution of shares from the trusts net of tax and                                 2.3                             -
minority interest
Goodwill amortisation                                                                42.6                          41.6
Before profit on sale of own shares, distribution of shares from the trusts,         22.3                          28.5
reorganisation costs and goodwill amortisation and impairment

                                                                                   Number                        Number
                                                                                     '000                          '000
Number of shares
Average number of shares in issue                                                 327,406                       321,356
Synergy deferred consideration - shares to be issued                                1,305                             -
Shares held by the employee trusts                                               (42,663)                      (41,939)
Shares used to calculate basic and diluted loss per                               286,048                       279,417
share
Synergy deferred consideration - contingent shares to                               2,697                             -
be issued
Effect of dilutive ordinary shares - share options                                  5,034                        11,842
Shares used to calculate diluted earnings per share pre profit on sale of own     293,779                       291,259
shares, distribution of shares from the trusts, reorganisation costs and
goodwill amortisation and impairment

                                                                                      Per                     Per share
                                                                                    share                        amount
                                                                                   amount
                                                                                    pence                         pence
Diluted (loss) earnings per share
Diluted loss per share                                                           (184.66)                        (3.68)
Effect of potential shares                                                           4.86                          0.15
Profit on sale of own shares                                                       (0.55)                        (0.99)
Exceptional items net of tax                                                       172.62                             -
Distribution of shares from the trusts net of tax and                                0.78                             -
minority interest
Goodwill amortisation                                                               14.50                         14.30

Before profit on sale of own shares, distribution of shares from the trusts,
reorganisation costs and goodwill amortisation and impairment                        7.55                          9.78

Where there is a loss per share there are no dilutive effects of share options or
contingent share issues.




6  Debtors
                                                                                             2002                  2001
                                                                                                                    (as
                                                                                                              restated)
                                                                                         £million              £million

Trade debtors                                                                                62.4                  65.8
Amounts to be billed on contracts                                                            18.0                  16.3
Employee share loans                                                                            -                   0.3
Other debtors                                                                                 1.2                   3.9
Prepayments                                                                                   8.0                   5.9
                                                                                             89.6                  92.2

7  Creditors due within one year
                                                                                             2002                  2001
                                                                                                                    (as
                                                                                                              restated)
                                                                                         £million              £million
Other creditors
Revenue in advance                                                                           22.5                  14.3
Trade creditors                                                                               7.0                   9.8
Corporation tax                                                                               8.1                  12.9
Other taxes and social security                                                              16.1                  13.2
Other creditors and accruals                                                                 32.1                  29.9
Proposed dividend                                                                             7.0                   6.2
Proposed dividend due to minority interest                                                    4.8                   3.5
                                                                                             97.6                  89.8


8  Reconciliation of operating profit to net cash inflow from operating activities
                                                                                               2002            2001
                                                                                                                (as
                                                                                                          restated)
                                                                                           £million        £million

Group operating loss                                                                        (505.2)           (1.7)
Depreciation charge                                                                             8.0             8.4
Loss (profit) on sale of tangible assets                                                        0.1           (0.5)
Profit on sale of own shares                                                                  (1.6)           (2.9)
Amortisation of goodwill                                                                       42.6            41.6
Distribution of shares from the trusts                                                          3.1               -
Goodwill impairment                                                                           497.0               -
Accrued reorganisation costs                                                                    5.1               -
Decrease (increase) in debtors                                                                  2.1           (5.1)
Increase (decrease) in creditors and provisions                                                 4.8          (16.1)
Net cash inflow from operating activities                                                      56.0            23.7


9  Analysis of changes in net debt

                               At 1 May                 At 1 May                                            At 30
                                   2001                     2001                                            April
                                                                                                             2002
                                    (as   Prior year         (as         Cash         Other   Exchange
                             previously   adjustment   restated)         flow      non-cash   movement
                                stated)                                             changes
                               £million     £million    £million     £million      £million   £million   £million

Cash at bank and in hand           23.9          0.4        24.3          1.5             -      (0.1)       25.7
Overdrafts                        (0.1)            -       (0.1)        (4.1)             -          -      (4.2)
                                                                        (2.6)

Debt due within one year         (23.3)        (0.2)      (23.5)         10.6         (3.7)        0.1     (16.5)
Debt due after one year          (22.3)        (0.2)      (22.5)          1.1           3.7          -     (17.7)
Finance leases                    (1.1)            -       (1.1)          0.3             -          -      (0.8)
                                                                         12.0

Cash deposits maturing in           0.1            -         0.1          2.5             -          -        2.6
one year
                                 (22.8)            -      (22.8)         11.9             -          -     (10.9)


10  Reconciliation of net cash flow to movement in net debt
                                                                                            2002            2001
                                                                                                             (as
                                                                                                       restated)
                                                                                        £million        £million

(Decrease) Increase in cash in year                                                        (2.6)             8.3
Cash outflow from decrease in debt and lease financing                                      12.0             8.1
Cash outflow (inflow) from increase (decrease) in liquid resources                           2.5           (0.1)
Change in net debt resulting from cash flows                                                11.9            16.3
Translation difference                                                                         -             0.1
Loans and finance leases acquired with subsidiary undertakings                                 -           (9.9)
Movement in net debt in year                                                                11.9             6.5
Net debt at 1 May                                                                         (22.8)          (29.3)
Net debt at 30 April                                                                      (10.9)          (22.8)


11  Prior year adjustment

The Group's policy for accounting for Employee Share Ownership Trusts has
changed to comply with Urgent Issues Task Force Abstract (UITF) 32 'Employee
Benefit Trusts and other intermediate payment arrangements' issued by the
Accounting Standards Board on 13 December 2001. Previously the assets,
liabilities and results of the Xansa Employee Trust were not recognised.

The adoption of UITF 32 has required the restatement of comparatives in
accordance with FRS 3. This change in accounting policy has had the effect of
decreasing retained losses by £2.2million for the year ended 30 April 2002 and
by £3.5million for the year ended 30 April 2001.   This arises principally from
the profit on sale of own shares.






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