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UCM Group PLC (UCM)

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Thursday 21 September, 2006

UCM Group PLC

Interim Results

UCM Group PLC
21 September 2006



Embargoed until 07.00                                          21 September 2006

                                   UCM Group PLC

               Interim Results for the Six Months Ended 30 June 2006

UCM, the leading provider of speciality fused minerals, today announces its
interim results for the six months ended 30 June 2006.

Financial Highlights

                                          Six Months                Six Months
£ Millions                                     Ended                     Ended
                                        30 June 2006              30 June 2005

Revenue                                        19.60                     17.48
Profit before tax                               1.35                      1.16
Earnings per share                              3.8p                      3.3p
Interim dividend                                1.0p*                     2.0p

Key Highlights

   •Pre-tax profits up by 16% on a sales increase of 12%
   •Increase in sales of standard zirconia products
   •Magnesia division returned to profitability
   •Outline planning sought for residential development at the Stafford site
   •Resumption of dividend payments
   •Positive outlook for second half


John Gordon, Chairman, commented; 'We have experienced an improvement in our
performance during the first half and I am delighted to report that we expect
the Group to perform well and remain profitable in the traditionally quieter
second half to December.'

*The interim dividend of 1.0p (net) per ordinary share will be paid on 26
October 2006 to shareholders on the register at 29th September 2006.


Enquiries


UCM Group PLC                                             (Today) 020 7067 0700
John Gordon, Chairman                                 (Thereafter) 01785 223122
Jamie Brundell, Chief Executive
Melvyn Fookes, Group Finance Director

Weber Shandwick Square Mile                                       020 7067 0700
Terry Garrett or Alex White or Stephanie Badjonat


Chairman's Statement

Results for the six months ended 30th June 2006

The first six months of 2006 have seen an improvement in both sales and profits
from the comparative period in 2005. Profit before taxation for the six months
ended 30th June 2006 amounted to £1,352,000 (2005: £1,164,000) on turnover of
£19,601,000 (2005: £17,479,000). Earnings per share for the period were 3.8p per
share (2005: 3.3p)

Dividend

The Directors have approved an interim dividend payment of 1.0p but have decided
that it is prudent to await the results for the full year before defining
dividend policy. For the 2005 financial year there was an interim payment of
2.0p with no final payment at the year end.

Trading

Zirconia Division

Sales of standard zirconia products have increased during the period. A large
part of this improvement reflects gains in market share and important new
customers being won by the division.

Sales of advanced ceramic materials, based upon zirconia chemistry, have also
increased compared to the corresponding period in 2005.

Magnesia Division

The Magnesia division's sales have remained stable compared to the corresponding
period of 2005. Actions taken to reduce the cost base of the plants, in the face
of higher energy and raw material costs, have been effective and higher selling
prices have been secured with a number of key customers, returning the business
to profitability.

Property

The Group has been investigating, with its advisers, the possibility of
residential development of its freehold site at Stafford. At present most of the
site is surplus to the operational needs of the Company and an application for
outline planning consent has been made to the Local Authority. If successful, it
is anticipated that a surplus to the book value of the property could be
realised, after providing for the cost of relocating the activities currently
operating on the site.

Outlook

Prospects for the Group remain positive for the second half of 2006.

Historically, the pattern of planned plant shut-downs, both at our own and at
customer's plants, in the second half of the year has resulted in lower sales
and profits than in the first half year. In 2005 this effect was magnified by
poor market conditions and exceptional cost increases so that the Group recorded
a loss in the second half of 2005. The Board anticipates that the Group will
remain profitable for the second half, albeit not to the extent recorded in the
six months to 30th June 2006. If achieved, this will enable the Board to
consider a final dividend.


John Gordon
Chairman
20th September, 2006.


CONSOLIDATED INTERIM INCOME STATEMENT
for the period ended 30 June 2006

                   Unaudited      Unaudited                       Audited
                  six months     six months             year ended 31 December 2005
                       ended          ended           Pre -   Exceptional   Continuing
                     30 June        30 June     exceptional         costs   operations
                        2006           2005
                      £000's         £000's          £000's        £000's       £000's

Revenue                19601          17479           33333             -        33333

Cost of sales         (15349)        (13480)         (27034)         (292)      (27326) 
                      _______        _______         _________________________________

Gross profit            4252           3999            6299          (292)        6007

Distribution
expenses                (110)          (109)           (218)            -         (218)
Administration
expenses               (2475)         (2421)          (4673)         (523)       (5196)
                      _______        _______         _________________________________
Operating
profit/(loss)           1667           1469            1408          (815)         593
                                                     _____________________

Financial income          14              -                                         37
Financial expenses      (329)          (305)                                      (639)
                      _______        _______                                    _______
Net finance cost        (315)          (305)                                      (602)
                      _______        _______                                    _______

Profit/(loss)
before tax              1352           1164                                         (9)

Taxation                (450)          (379)                                      (362)
                      _______        _______                                    _______
Profit/(loss) 
for the period
attributable to 
equity holders
of the Company           902            785                                       (371)
                      _______        _______                                    _______

Earnings per
ordinary share

Basic and diluted        3.8p           3.3p                                      (1.6p)



CONSOLIDATED INTERIM BALANCE SHEET
as at 30 June 2006

                                     Unaudited        Unaudited            Audited
                                       30 June          30 June        31 December
                                          2006             2005               2005
                                        £000's           £000's             £000's
Non current assets

Intangible assets                           19              597                 30
Property, plant and equipment            14574            16139              15610
Deferred tax asset                           -                -                289
                                        _______          _______           ________
                                         14593            16736              15929
                                        _______          _______           ________
Current assets

Stocks                                    7992             9161               8091
Trade and other receivables               7207             6720               6377
Cash and cash equivalents                  800              581                865
                                        _______          _______           ________
                                         15999            16462              15333
                                        _______          _______           ________

                                        _______          _______           ________
Total assets                             30592            33198              31262
                                        _______          _______           ________

Current liabilities

Financial liabilities                     9541            10158              10407
Trade and other payables                  3459             3569               3001
Current tax payable                        420              253                216
                                        _______          _______           ________
                                         13420            13980              13624
                                        _______          _______           ________

Non current liabilities

Financial liabilities                      147              489                202
Post employment benefits                  3413             4040               4744
Deferred tax liabilities                   103              149                  -
                                        _______          _______           ________
                                          3663             4678               4946
                                        _______          _______           ________

                                        _______          _______           ________
Net assets                               13509            14540              12692
                                        _______          _______           ________

Equity

Share capital                             1196             1196               1196
Share premium account                     8402             8402               8402
Retained earnings                          871             1509               (747)
Other reserves                            3040             3433               3841
                                        _______          _______           ________
Total equity                             13509            14540              12692
                                        _______          _______           ________



CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS
for the period ended 30 June 2006

                                      Unaudited      Unaudited         Audited
                                     six months     six months            year
                                          ended          ended           ended
                                        30 June        30 June     31 December
                                           2006           2005            2005
                                         £000's         £000's          £000's

Cash flows from operating activities

Profit/(loss) for the period                902            785            (371)
Adjustments for:
Depreciation                                852            853            1733
Amortisation                                 10             52             150
Impairment                                    -              -             735
Interest                                    315            305             602
Income tax                                  450            379             362
                                         _______        _______        ________
Operating profit before changes in 
working capital and provisions             2529           2374            3211


(Increase)/decrease in trade and 
other receivables                         (1109)          (142)            350
(Increase)/decrease in inventories         (245)          (705)            527
Increase/(decrease) in
trade and other payables                    693            156            (451)
(Decrease) in provisions
and employee benefits                      (314)          (265)           (542)
                                         _______        _______        ________
Cash generated from the operations         1554           1418            3095

Interest received                            18              -              37
Interest paid                              (339)          (298)           (637)
Income tax paid                            (141)           (29)           (179)
                                         _______        _______        ________
Net cash from operating activities         1092           1091            2316
                                         _______        _______        ________

Cash flows from investing activities

Acquisition of property
plant and equipment                        (369)          (329)           (672)
                                         _______        _______        ________
Net cash flow from investing 
activities                                 (369)          (329)           (672)
                                         _______        _______        ________

Cash flow from financing activities

Repayment of amounts borrowed              (545)          (331)           (375)
Payment of finance lease liabilities       (170)          (139)           (284)
Dividends paid                                -           (598)          (1077)
                                         _______        _______        ________
Net cash from financing activities         (715)         (1068)          (1736)
                                         _______        _______        ________

Net increase/(decrease) in cash and 
cash equivalents                              8           (306)            (92)
Cash and cash equivalents at 
1 January                                   865            815             815
Effect of exchange rate fluctuations 
on cash held                                (73)            72             142
                                         _______        _______        ________
Cash and cash equivalents at 
period end                                  800            581             865
                                         _______        _______        ________



STATEMENT OF RECOGNISED INCOME AND EXPENSE (SORIE)
for the period ended 30 June 2006

                                                Unaudited    Unaudited       Audited
                                               six months   six months          year
                                                    ended        ended         ended
                                                  30 June      30 June   31 December
                                                     2006         2005          2005
                                                   £000's       £000's        £000's

Profit/(loss) for the period                          902          785          (371)

Currency translation adjustment                      (758)         739          1189
Actuarial gains/(losses) on defined 
benefit scheme                                        971         (287)        (1237)
Tax on items taken directly to equity                (298)          91           378
                                                   _______      _______      ________
Total recognised income and expenses
attributable to equity shareholders                   817         1328           (41)
                                                   _______      _______      ________


RECONCILIATION OF MOVEMENTS IN EQUITY
for the period ended 30 June 2006 - unaudited

                        Share     Share      Capital   Translation   Revaluation   Retained     Total
                      capital   premium   redemption       reserve       surplus   earnings    equity
                                             reserve
                       £000's    £000's       £000's        £000's        £000's     £000's    £000's

Total equity as at 
1 January 2005           1196      8402          218          -691          3210       1475     13810

Movements for the 
period:

Recognised income 
and expense                 -         -            -           739           -43        632      1328

Dividends to
shareholders                -         -            -             -             -       -598      -598
                      ________  ________     ________      ________      ________   ________  ________

Total equity as at 
30 June 2005             1196      8402          218            48          3167       1509     14540
                      ________  ________     ________      ________      ________   ________  ________

Total equity as at 
1st January 2005         1196      8402          218          -691          3210       1475     13810

Movements for the 
period:

Recognised income 
and expense                 -         -            -          1189           -85      -1145       -41

Dividends to
shareholders                -         -            -             -             -      -1077     -1077
                      ________  ________     ________      ________      ________   ________  ________

Total equity as at 
31 December 2005         1196      8402          218           498          3125       -747     12692
                      ________  ________     ________      ________      ________   ________  ________

Total equity as at 
1 January 2006           1196      8402          218           498          3125       -747     12692

Movements for the
period:

Recognised income 
and expense                 -         -            -          -758           -43       1618       817
                      ________  ________     ________      ________      ________   ________  ________
Total equity as at 
30 June 2006             1196      8402          218          -260          3082        871     13509
                      ________  ________     ________      ________      ________   ________  ________


Notes to the accounts
for the period ended 30 June 2006

1. Basis of preparation

This interim financial information has been prepared applying the accounting
policies and presentation that were applied in the preparation of the Group's
published consolidated accounts for the year ended 31 December 2005.

The comparative figures for the year ended 31 December 2005 are not the
statutory accounts for that financial year. Those accounts have been reported on
by the auditors and delivered to the registrar of companies. The report of the
auditors was unqualified and did not contain statements under section 237(2) or
(3) of the Companies Act 1985.

2. Segmental reporting

                                  Unaudited          Unaudited             Audited
                                 six months         six months                year
                                      ended              ended               ended
                                    30 June            30 June         31 December
                                       2006               2005                2005
                                     £000's             £000's              £000's

Revenue by market

Domestic & Industrial
Appliances                             8690               8407               15988
Steelmaking                            5785               4261                7768
Automotive                             4105               3528                7269
Investment casting                       28                 28                  43
Engineered ceramics                     639                627                1223
Other industrials                       354                628                1042
                                    ________           ________           ________
                                      19601              17479               33333
                                    ________           ________           ________

Revenue by customer location

United Kingdom                         1356               1230                2270
North America                          6545               4804                9291
Continental Europe                     6943               6801               12581
Asia                                   3950               3927                7693
Central & South America                 646                459                 989
Rest of World                           161                258                 509
                                    ________           ________           ________
                                      19601              17479               33333
                                    ________           ________           ________

3. Earnings per share

Earnings per share for the period have been calculated on profit for the period
divided by 23,932,373 being the weighted average number of ordinary shares of 5p
each in issue during the period (2005 half year and 2005 full year weighted
average 23,932,373).

4. Taxation

Taxation has been provided at the estimated effective rate for the full year.

5. Dividends

The interim dividend of 1.0p (net) per ordinary share will be paid on 26 October
2006 to shareholders on the register at 29th September 2006.

6. Distribution of interim results

Copies of the interim report will be posted to shareholders on Thursday 5th
October and will be available from the Company's registered office at Doxey Road
Stafford ST16 1DZ during normal business hours.



INDEPENDENT REVIEW REPORT BY KPMG AUDIT Plc TO UCM GROUP PLC


Introduction

We have been instructed by the Company to review the financial information for
the six months ended 30 June 2006 which comprises the Consolidated Income
Statement, Consolidated Balance Sheet, Consolidated Statement of Cash Flow,
Consolidated Statement of Recognised Income and Expense, Reconciliation of
Movements in Equity and the related notes. We have read the other information
contained in the interim report and considered whether it contains any apparent
misstatements or material inconsistencies with the financial information.

This report is made solely to the Company in accordance with the terms of our
engagement to assist the Company in meeting the requirements of the Listing
Rules of the Financial Services Authority. Our review has been undertaken so
that we might state to the Company those matters we are required to state to it
in this report and for no other purpose. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other than the Company for
our review work, for this report, or for the conclusions we have reached.

Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the Directors. The Directors are
responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be consistent
with those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.

Review work performed

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

Review conclusion

On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2006.

KPMG Audit Plc
Chartered accountants
Manchester
20 September 2006.




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