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  Print      Mail a friend       Annual reports

Wednesday 15 March, 2006


Final Results - Replacement

               Immediate Release: Wednesday 15th March 2006

The following announcement replaces the announcement published today at 
                07:01hrs under reference PRNUK-1403061501-5D7F.

Profit before amortisation of intangibles should have read up to £2.7m and EPS
should have read up to 1.63p. The rest of the announcement remains unchanged
and the full and correct text can be found below:

                                   TG21 plc                                    

                                 (`The group')                                 

        Preliminary Results for the 12 Months Ended 31st December 2005         


•Profit before amortisation of intangibles up from £2m to £2.7m

•Net profit up 74%

•EPS (basic) up 68% to 1.63p

•Net debt increase of only £0.1m after payment of £3.1m to acquire controlling
stake in 21st Century

•Investment in 21st Century increased to 75% which contributed over £1m to
operating profit

•Hands free installations continue to grow

•Datatool wins new distribution rights

For enquiries please contact:

Peter Ward TG21 plc Tel: 020 8710 4000


Wilson Jennings TG21 plc Tel: 020 8710 4000

Finance Director

Andrew Tan Hansard Communications Tel: 020 7245 1100

Account Director

Chairman's Statement

Principal activities

The Group's principal activities are the supply and installation of products in
the following market sectors:

• Public transport CCTV

• Mobile `phone hands-free installations

• Insurance replacement of stolen in-car entertainment systems

• Car and motorcycle security and accessory products

Trading Results

Group sales for the year increased by £1.7m to £36.3m (2004: £34.6m) and
include £1.9m turnover from 21st Century which was consolidated for the five
months from 1st August 2005 being the date that we took a controlling interest.

Group                                                           2005       2004
                                                                  £m         £m
Turnover                                                        36.3       34.6
Gross profit                                                    14.9       14.2
Gross profit percentage                                        41.0%      41.0%
Total operating expenses excluding amortisation and           (12.2)     (12.2)
impairment of intangibles                                                      
Total operating profit before amortisation and impairment        2.7        2.0
of intangibles                                                                 
Amortisation and impairment of intangibles                     (0.4)      (0.7)
Total operating profit                                           2.3        1.3
Net profit attributable to members of the parent company         1.3        0.8
EPS (basic)                                                    1.63p      0.97p
Net debt                                                         3.8        3.7

I am very pleased to report that Group operating profit before amortisation and
impairment of intangibles has increased to £2.7m (2004: £2.0m). This includes £
0.6m of operating profit (before amortisation) arising on the consolidation for
the last 5 months of the year of our newly acquired subsidiary, 21st Century
Crime Prevention Services Limited ('21st Century'). 21st Century supplies and
installs CCTV equipment for use on public transport vehicles. In addition in
the period after we made our initial investment but before we took a
controlling stake we provided a range of services to 21st Century to support
expansion of its activities for which we charged 21st Century £500,000. This
brought the total contribution from 21st Century to group pre-amortisation
operating profit for the year to £1.1m. In the prior year, the sale of certain
distribution rights to 21st Century contributed £0.8m to group profit.

Group net profit (attributable to the members of the parent company) is up 63%
at £1.3m (2004: £0.8m) and basic Earnings Per Share is up 68% at 1.63p (2004:
0.97p). The closing share price at 31 December 2005 was 13p (2004: 13.75p)
giving a p/e ratio for TG21 plc of just 8.0 (2004: 14.2) at that date.

Public transport CCTV

During the year we increased our investment in 21st Century to 75% having
acquired an initial 25% in 2004. The total cost of this investment to date is £
4.9m including professional fees and we have an option to acquire the remaining
25% for £2.1m.

From the start of the year we geared up our engineering resource within the
group to service the installation needs of 21st Century. As described above we
recovered these costs by way of a £0.5m charge to 21st Century in respect of
services provided. Given the contribution to group profit from 21st Century we
waived our preference share dividend entitlement of £0.5m due from 21st Century
for 2005 although a dividend entitlement remains for future years.

In my last interim statement I also announced that 21st Century had won
business worth £1.5m for the installation of CCTV and related systems at a
regional bus depot. Much of the work in this region was delayed by the customer
until the Spring of 2006 and so we can look forward to the contribution from
this project in the current year.

Our key targets for 21st Century are to build upon their existing customer
relationships, develop value added products to compliment the security CCTV
solutions they offer and to win new customers in the public transport market.
Our prospects in this regard are significantly improved following the recent
appointment of a Director of Sales for 21st Century who has been recruited from
the UK's leading supplier of public transport ticketing machines.

Mobile `phone hands-free installations

Turnover from the installation of mobile `phone hands-free kits was up to £4.9m
(2004 excluding sale of distribution rights: £4.4m) for the year. We are now
undertaking around 3,000 of these installations a month for Unipart who manage
the installation logistics on behalf of Vodafone.

Insurance replacement of stolen in-car entertainment systems

Car audio insurance replacement turnover was down £1.6m in line with
expectations at £7.1m (2004: £8.7m) but our relationships with a number of
insurance companies has the potential to yield another installation income
stream through a new initiative known as Pay As You Drive (PAYD) . Under the
PAYD scheme the motor insurance policy holders benefit from a reduced premium
in return for having a black-box device fitted to their vehicles which is
capable of recording journey information. Our involvement is as an installation
contractor acting for the insurance companies. This new initiative, if adopted
widely in the car insurance market, could make a significant and increasing
contribution to our 2006 and future year results.

Car and motorcycle security and accessory products

Within our Distribution Division, sales of portable satellite navigation
systems have compensated for the anticipated decline in the car security
market. However the margins in this high volume business are much tighter and
this has had an impact on the gross profit in this sector.

Datatool, our motorcycle security and accessory business, has recently been
awarded distribution rights for a number of exciting products and we anticipate
growth from these in the current year.


Cash flow remains strong. We increased our long term loans by £2.5m to help
finance the acquisition of 21st Century. However, through efficient working
capital management net debt at the year end was up by only £0.1m to stand at £
3.8m (2004: £3.7m).

Dividend policy

To date the company has not been in a position to pay dividends because of the
level of bank debt in the business and the losses of the company accumulated in
its formative years. In the last four years the group has generated a retained
profit of £3.5m and £13.4m in cash from operating activities. The group has
also reduced net debt from £8.5m to £3.8m in that period. If we are able to
maintain our cash generation and can successfully exploit our growth
opportunities, it is the Board's intention to review the company's dividend
policy during 2006. To this end a Resolution will be put forward for
consideration by shareholders at our next AGM to enable the company to offset
its share premium against its prior year accumulated losses so that future
profit is available for distribution by way of dividend.

Move to AIM

The company's ordinary shares were moved across from the Official List of the
United Kingdom Listing Authority (the 'Official List') to the AIM market of the
London Stock Exchange ('AIM') on 15 April 2005.

As an AIM company, the company continues to be subject to the regulatory and

controls of the London Stock Exchange. The board believes that AIM, with its
lower cost of complying with continuing obligations, is a more appropriate
market for the company given its size and shareholder base.

Strategy and current trading

During 2005 we positioned the business to focus more efficiently and
effectively on the high growth sectors in the group. Our investment in 21st
Century has yielded an excellent return and has made a significant contribution
to group results in 2005. We are looking to consolidate our position in the
current year which to date is in line with expectations and develop the
opportunities for growth into 2007.


Finally, I would like to take this opportunity to thank all the staff for their
hard work over the last year. Without their contribution the good performance
this year could not have been achieved.

Peter Ward


14 March 2006

Operating Review

The TG21 plc group of companies now operates in three divisions:

•Public transport CCTV

•Services - Technical

- Insurance


Public transport CCTV

Principal activities: The supply and installation of CCTV systems for public
transport vehicles. Major customers include Arriva UK Bus, Alexander Dennis,
Volvo and Scania Buses.

Full year sales in our newly acquired subsidiary, 21st Century, were £4.3m of
which £1.9m (2004: nil) has been included in our consolidated turnover from the
date of the acquisition of our majority stake.

The company has now undertaken 3,000 installations of CCTV systems in the UK
and is expecting to undertake at least another 1,000 installations in the
current year. The company also has several pipeline products which will run
through the same gateway as the CCTV system and which could potentially save
millions of pounds for major bus operators. We are using these value added
products in our marketing drive for new customers to build on the solid
platform that this company has established with its existing customers.


Principal activities: 1) Technical Services - The supply and installation of
hands-free mobile `phone kits to corporate fleets. The major customer is
Vodafone whose installation logistics are managed by Unipart Logistics Limited
('Unipart'). 2) Insurance Services - Insurance replacement and installation of
stolen in-car entertainment and satellite navigation systems. Most of the
leading insurance companies are among this division's customers and they
include Norwich Union and the Royal Bank of Scotland Group.

Technical Services turnover excluding the sale of distribution rights last year
was up by 11% at £4.9m (2004 sales excluding sale of distribution rights: £
4.4m). Most of this income comes from our contract with Unipart to undertake
hands-free `phone kit installations into corporate fleet customers of Vodafone.
During the year we were consistently ranked highly against our KPIs and as a
consequence were awarded the installation business for several new customers.
Monthly sales of hands-free installations have increased steadily from
approximately £0.2m in January 2004 to £0.4m in December 2005.

The car audio insurance replacement market continues to mature and as a
consequence Insurance Services turnover at £7.1m was 18% down on the previous
year (2004 sales: £8.7m). We have maintained excellent working relationships
with our insurance company clients to increase penetration in this market.
Moreover, we believe that these relationships can generate other sources of
income for vehicle installation work. A number of insurance companies have been
looking at launching Pay As You Drive (PAYD) type motor insurance schemes. PAYD
is a relatively new concept in the motor insurance industry and we are looking
to be a 'black-box' installation contractor for the insurance companies
offering these schemes. We are currently running trials with several insurance
companies who are planning to implement PAYD schemes in 2006. This represents a
great opportunity for us to build on our excellent reputation with the insurers
for quality installation and call centre services.

The Services division incorporates our engineering workforce which has provided
supporting services to 21st Century. On 31 July 2005 the Services division
charged £0.5m to 21st Century for the provision of its services up to that
date. There was no such charge in 2004 but in that year Services sales included
£0.8m in respect of the sale of certain distribution rights to 21st Century.


Principal activities: The distribution of in-car entertainment systems, satnav/
communication equipment, speed camera alerts, audio leads and own brand
automotive and motorcycle alarms to the retail trade and original equipment
manufacturers. Major customers include Argos, Subaru, Triumph Motorcycles and

Distribution turnover increased to £21.9m (2004: sales £20.7m). Sales of
portable satellite navigation systems have made a major contribution to this
growth and have compensated at the turnover line for the continued decline in
the car security market.

We have extended the product range within Datatool and have recently been
awarded distribution rights within the UK motorcycle market for Tracker, TomTom
navigation, the Inforad speed camera location device and the Text Alert
security product.

Operating expenses

Group operating expenses excluding amortisation and impairment of intangibles
at £12.2m are in line with the previous year despite the fact that the 2005
operating expenses include £0.3m of overheads from the results of 21st Century.

Amortisation and impairment of intangibles for 2005 is £0.4m, down from £0.7m
in 2004. The 2004 charge included a one-off £0.4m provision for impairment
(2005: Nil).

Working capital and net debt

Net cash inflow from operations was £4.1m (2004: £3.0m) up £1.1m on the prior
year. We spent £3.1m including professional fees to acquire a further 50% of
21st Century (2004: initial 25% stake cost of £1.8m) bringing our holding to
75%. At the date of the acquisition of our controlling stake, 21st Century had
£0.3m of cash at bank. Net long term borrowing was increased by £2.5m to part
finance the acquisition (2004: repayment of £1.0m), we paid £0.5m (2004: £0.5m)
in interest and finance costs and invested £0.7m (2004: £0.5m) in fixed assets
during the year.

The resultant year end net debt has increased slightly on last year to stand at
£3.8m (2004: £3.7m).

Nick Grimond

Chief Executive Officer

14 March 2006

Consolidated profit and loss account

For the year ended 31 December 2005

                          Notes       Before Amortisation        2005      2004
                                amortisation           of                      
                                              intangibles       £'000     £'000
                 Turnover             34,381            -      34,381    34,574
    Continuing operations                                                      
Acquisitions                           1,935            -       1,935         -
                                  __________   __________   _________  ________
                          1           36,316            -      36,316    34,574
Cost of sales             2         (21,409)            -    (21,409)  (20,380)
                                  ----------   ----------   ---------  --------
Gross profit                          14,907            -      14,907    14,194
 Other operating expenses 2         (12,202)        (312)    (12,514)  (12,874)
   Group operating profit              2,080        (118)       1,962     1,320
    Continuing operations                625        (194)         431         -
             Acquisitions          _________     ________     _______  ________
                                       2,705        (312)       2,393     1,320
Share of operating loss                 (21)        (116)       (137)       (6)
in associate -                                                                 
                                   ---------    ---------   --------- ---------
Total operating profit                 2,684        (428)       2,256     1,314
Interest payable and                   (500)            -       (500)     (547)
similar charges                                                                
                                   ---------    ---------   --------- ---------
Profit on ordinary                     2,184        (428)       1,756       767
activities before                                                              
Taxation                               (289)            -       (289)         -
                                   ---------    ---------   --------- ---------
Profit on ordinary                     1,895        (428)       1,467       767
activities after taxation                                                      
Minority interest -                    (132)            -       (132)       (1)
                                   ---------    ---------   --------- ---------
Profit for the year                    1,763        (428)       1,335       766
attributable to members                                                        
of the parent company                                                          
                                   ---------    ---------   --------- ---------
Earnings per share -                                            1.63p     0.97p
- diluted                                                       1.63p     0.94p
Consolidated note of group historical cost                  2005           2004
profits and losses                                                             
                                                           £'000          £'000
Reported profit on ordinary activities                     1,756            767
before taxation                                                                
Difference between historical cost                            28              -
depreciation charge and actual depreciation                                    
charge for the year calculated on the                                          
revalued amount                                                                
                                                        --------        -------
Historical cost profit on ordinary                         1,784            767
activities before tax                                                          
                                                        --------       --------
Historical cost profit on ordinary                         1,363            766
activities after tax and minority interest                                     
                                                        --------       --------
Consolidated statement of total recognised                  2005           2004
gains and losses                                                               
                                                           £'000          £'000
Profit/(loss) for the financial year                                           
- Group                                                    1,472            772
- Associate company                                        (137)            (6)
                                                        --------        -------
                                                           1,335            766
        Unrealised surplus on revaluation of                   -          1,406
                           freehold property                                   
                                                        --------        -------
Total recognised gains for the year                        1,335          2,172
                                                        --------       --------
- Group                                                    1,472          2,178
- Associate company                                        (137)            (6)
                                                        --------        -------
Total recognised gains for the year                        1,335          2,172
                                                        --------       --------

Balance Sheets

as at 31 December 2005

                                                  Group                 Company
                             Notes  2005           2004 2005               2004
                                        £'000     £'000     £'000         £'000
Fixed assets                                                                   
Intangible assets              4        4,850       634         -             -
Tangible assets                5        4,645     4,406         -             -
Investments                                 -     1,774    13,721        10,562
                                      -------   -------   -------       -------
                                        9,495     6,814    13,721        10,562
                                      -------   -------   -------       -------
Current assets                                                                 
Stocks                                  3,799     3,678         -             -
Debtors                                 6,771     5,000     3,395         4,184
Cash at bank and in hand                1,525       809        40             -
                                      -------   -------   -------       -------
                                       12,095     9,487     3,435         4,184
                                      -------   -------   -------       -------
Creditors: amounts falling            (8,865)   (7,626)   (1,088)       (1,099)
due within one year                                                            
                                      -------   -------   -------       -------
Net current assets                      3,230     1,861     2,347         3,085
                                      -------   -------   -------       -------
Total assets less current              12,725     8,675    16,068        13,647
Creditors: amounts falling            (3,468)     (975)   (3,468)         (975)
due after more than one year                                                   
                                      -------   -------   -------       -------
Net assets                              9,257     7,700    12,600        12,672
                                      -------   -------   -------       -------
Capital and reserves                                                           
Called up share capital                 8,169     8,169     8,169         8,169
Share premium account                  12,110    12,110    12,110        12,110
Other reserve                              43        43        43            43
Merger reserve                              -         -     1,001         1,001
Revaluation reserve                     1,378     1,406         -             -
Profit and loss account              (12,665)  (14,028)   (8,723)       (8,651)
                                      -------   -------   -------       -------
Total equity shareholders'     6        9,035     7,700    12,600        12,672
Minority interests                        222         -         -             -
                                      -------   -------   -------       -------
Capital employed                        9,257     7,700    12,600        12,672
                                      -------   -------   -------       -------

Consolidated statement of cash flows

For the year ended 31 December 2005

                                              Notes           2005         2004
                                                             £'000        £'000
Net cash inflow from operating activities       7            4,092        3,002
                                                        ----------   ----------
Returns on investments and servicing of                                        
Interest paid                                                (463)        (461)
Interest paid on finance leases                                  -          (2)
Issue costs of new loans                                      (40)            -
                                                        ----------   ----------
                                                             (503)        (463)
                                                        ----------   ----------
UK corporation on tax paid                                   (151)            -
                                                        ----------   ----------
Capital expenditure                                                            
Purchase of tangible fixed assets                            (699)        (513)
Sale of tangible fixed assets                                    -            5
                                                        ----------   ----------
                                                             (699)        (508)
                                                        ----------   ----------
Purchase of investment in associate*                             -      (1,780)
Purchase of investment in subsidiary*                      (3,133)            -
Cash acquired                                                  319            -
                                                        ----------   ----------
                                                           (2,814)      (1,780)
                                                        ----------   ----------
Cash (outflow)/inflow before financing                        (75)          251
Issue of shares                                                  -           25
Increase/(decrease) in long term borrowings                  2,500      (1,000)
Repayment of principal under finance leases                    (2)         (13)
                                                        ----------   ----------
                                                             2,498        (988)
                                                        ----------   ----------
Increase/(decrease) in cash in the year        8,9           2,423        (737)
                                                        ----------   ----------

  * The purchase of investment in associate in 2004 represents the payment made
    to acquire a minority stake in 21st Century which became a subsidiary on 1
    August 2005 when a controlling interest was taken.
Notes to the preliminary announcement

For the year ended 31 December 2005

1. Segmental reporting

Turnover consists primarily of sales made in the United Kingdom. Export sales
are not material. The analysis by business area is based upon the group's
reporting structure. Sales between segments are not material.

                       Turnover                   Profit before tax            
Business analysis      2005      2004        Before         After         After
                                       amortisation  amortisation  amortisation
                      £'000     £'000            of            of           and
                                        intangibles   intangibles impairment of
                                               2005          2005              
                                              £'000         £'000              
Continuing           12,454    13,897           720           720           575
Distribution         21,927    20,677           860           742           192
                    -------   -------   -----------   -----------   -----------
                     34,381    34,574         1,580         1,462           767
Acquisitions          1,935         -           604           294             -
Public transport                                                               
                    -------   -------   -----------   -----------   -----------
                     36,316    34,574         2,184         1,756           767
                    -------   -------   -----------   -----------   -----------

                                              Net assets/(liabilities)         
Business analysis                         Excluding     Including     Including
                                         intangible    intangible    intangible
                                             assets        assets        assets
                                               2005          2005          2004
                                              £'000         £'000         £'000
Services                                      2,651         2,651         3,479
Distribution                                  5,790         6,322         4,021
Public transport CCTV                       (4,134)           184             -
                                        -----------   -----------   -----------
                                              4,307         9,157         7,500
Central (deferred tax asset)                    100           100           200
                                        -----------   -----------   -----------
                                              4,407         9,257         7,700
                                        -----------   -----------   -----------

Services net assets in 2004 include £1,774,000 in respect of the investment in
21st Century. In 2005 a new segment has been created for this business; Public
Transport CCTV.

Central net assets comprise assets, partially offset by liabilities, that
cannot practicably be divided between the segments and comprise the deferred
corporation tax asset.

2. Cost of sales and other operating expenses

                                                               2005        2004
                                                              £'000       £'000
Cost of sales                                                                  
Continuing operations                                        20,426      20,380
Acquisitions                                                    983           -
                                                          ---------   ---------
                                                             21,409      20,380
                                                          ---------   ---------

                                  Before  Amortisation        2005        2004
                            amortisation            of                        
                                           intangibles       Total       Total
                          of intangibles                                      
                                                 £'000       £'000       £'000
Other operating expenses                                                      
Administrative expenses                                                       
Continuing operations              3,875           118       3,993       4,653
Acquisitions                         108           194         302           -
                              ----------    ----------  ----------  ----------
                                   3,983           312       4,295       4,653
Distribution expenses                                                         
Continuing operations              8,000             -       8,000       8,221
Acquisitions                         219             -         219           -
                              ----------    ----------  ----------  ----------
                                   8,219             -       8,219       8,221
                              ----------    ----------  ----------  ----------
                                  12,202           312      12,514      12,874
                              ----------    ----------  ----------  ----------

3. Amortisation of and impairment of intangibles

                                                               2005        2004
                                                              £'000       £'000
Amortisation of goodwill and other intangibles*                 428         268
Impairment of intangibles                                         -         422
                                                          ---------   ---------
                                                                428         690
                                                          ---------   ---------

*Includes amortisation on investment in associate of £116,000 (2004: £3,000)

4. Intangible fixed assets

Group                 21st Datatool  Metvale    Total    Spacetrac Patents  Actra      Total
                   Century goodwill goodwill goodwill distribution                goodwill &
                  goodwill                               agreement   £'000  £'000 intangible
                              £'000    £'000    £'000                                 assets
                     £'000                                   £'000                          
At 1 January 2005        -      980      802    1,782          230     110    333      2,455
Additions            4,628       16        -    4,644            -       -      -      4,644
                    ------   ------   ------   ------       ------  ------ ------     ------
At 31 December       4,628      996      802    6,426          230     110    333      7,099
                    ------   ------   ------   ------       ------  ------ ------     ------
At 1 January 2005        -      368      802    1,170          230      88    333      1,821
Charge for the         310       96        -      406            -      22      -        428
                    ------   ------   ------   ------       ------  ------ ------     ------
At 31 December         310      464      802    1,576          230     110    333      2,249
                    ------   ------   ------   ------       ------  ------ ------     ------
Net book value:                                                                             
At 31 December       4,318      532        -    4,850            -       -      -      4,850
                    ------   ------   ------   ------       ------  ------ ------     ------
At 31 December           -      612        -      612            -      22      -        634
                    ------   ------   ------   ------       ------  ------ ------     ------

21stCentury goodwill

The company has acquired a 75% interest in 21st Century Crime Prevention
Services Limited ('21st Century') in three tranches:


Acquired            Date                Nature of                 Consideration
25%                 18 December 2004    Preference Shares*                £1.8m
24%                 9 May 2005          Preference Shares*                £0.8m
26%                 1 August 2005       Ordinary Shares                   £2.3m

*21st Century has two classes of shares, being ordinary and preference shares.
The preference shares and ordinary shares rank pari-passu in all in all
respects except in terms of entitlement to dividends.

The preference shares yield an annual dividend entitlement of at least £
500,000. The 2005 dividend entitlement was waived by the preference share
holders. A charge of £500,000 for provision of services was made from the
company to 21st Century for the 7 months to 31 July 2005.

The company has an option to acquire the remaining 25% of 21st Century for £
2.1m in cash. Should the company not exercise this option by 18 December 2006,
the minority shareholder in 21st Century has the option to buy back the 75%
interest currently held by the company.

From the date of the initial acquisition on 18 December to 31 July 2005 the
acquisition contributed a net loss of £23,500 to the group's results. In its
last published accounts for the 7 months ended 31 December 2004, 21st Century
Crime Prevention Services Limited made a loss after exceptional costs of £
850,000 of £574,000. For the period since that date to the date that the
controlling stake was acquired on 31 July 2005, 21st Century Crime Prevention
Services management accounts show:

Turnover                                    2,365
Operating profit before charges from          463
TG21 plc for provision of services               
Operating loss after charges from            (37)
TG21 plc for provision of services               
Loss before taxation                         (37)
Taxation                                       11
Net loss after tax                           (26)

In summary, the analysis of net assets acquired and the fair value to the Group
(at the date of taking the controlling interest at 1 August) is as follows:

                                  Book and fair      TG21 plc Fair value to
                                   value of net   Group Share         Group
                                                        (75%)         £'000
Tangible fixed assets                        24            18            18
Stocks                                      394           296           296
Debtors                                   1,507         1,130         1,130
Cash                                        319           239           239
Creditors: falling due within one       (1,849)       (1,387)       (1,387)
                                      ---------     ---------     ---------
Net assets                                  395           296           296
Cash                                                                  4,647
Acquisition costs                                                       277
Total consideration                                                   4,924
Goodwill                                                              4,628
The fair value of the net assets                                           
acquired are provisional.                                                  

5. Fixed asset investments

Details of the Group's investments are:

                                                                    Interest in
At 1 January 2005                                                         1,777
Addition                                                                    102
  * Net assets                                                              727
  * Goodwill                                                               (21)
Share of loss in period                                                        
Reclassification on change from associate to subsidiary company         (2,585)
At 31 December 2005                                                           -
Accumulated amortisation of goodwill:                                          
At 1 January 2005                                                             3
Charge for the year                                                         116
Reclassification on change from associate to subsidiary company           (119)
At 31 December 2005                                                           -
Net book amount:                                                               
At 31 December 2005                                                           -
At 31 December 2004                                                       1,774

The investment above represents the group's interest in 21st Century accounted
for on an equity basis of accounting up to the point that the company took a
controlling interest in 21st Century on 1 August 2005. On this date the
investment became a 75% subsidiary and therefore the cost and accumulated
amortisation have been reclassified appropriately.

Details of the company's investments are:

                                                                   Interests in
At 1 January 2005                                                        20,711
Additions                                                                 3,159
At 31 December 2005                                                      23,870
Amounts provided:                                                              
At 1 January 2005                                                      (10,149)
Provided in the year                                                          -
At 31 December 2005                                                    (10,149)
Net book amounts:                                                        13,721
At 31 December 2005                                                            
At 31 December 2004                                                      10,562

6. Reconciliation of movements in equity shareholders' funds

Group                                                          2005        2004
                                                              £'000       £'000
Opening shareholders' funds                                   7,700       5,503
Exercise of share options                                         -          25
Revaluation surplus                                               -       1,406
Profit for the year                                           1,335         766
                                                          ---------   ---------
Closing equity shareholders' funds                            9,035       7,700
                                                          ---------   ---------

Company                                                        2005        2004
                                                              £'000       £'000
Opening shareholders' funds                                  12,672      20,155
Exercise of share options                                         -          25
Loss for the year                                              (72)     (7,508)
                                                          ---------   ---------
Closing equity shareholders' funds                           12,600      12,672
                                                          ---------   ---------

7. Reconciliation of operating profit to net cash inflow from operating

                                                               2005        2004
                                                              £'000       £'000
Operating profit                                              2,393       1,320
Depreciation on tangible fixed assets                           482         414
Amortisation and impairment of intangible fixed assets          312         690
Decrease in stocks                                              273          77
(Increase)/decrease in debtors                                (364)         153
Increase in creditors                                           996         348
                                                          ---------   ---------
Net cash inflow from continuing operating activities          4,092       3,002
                                                          ---------   ---------

8. Reconciliation of net cash flow to movement in net debt

                                                               2005        2004
                                                              £'000       £'000
Increase/(decrease) in cash in the year                       2,423       (737)
Cash outflow from movement in debt                          (2,498)       1,013
                                                          ---------   ---------
Change in net debt arising from cash flows                     (75)         276
Capitalisation of loan issue costs                               40           -
Amortisation of loan issue costs                               (33)        (85)
                                                          ---------   ---------
Movement in net debt in the year                               (68)         191
Net debt at 1 January (see note 9)                          (3,725)     (3,916)
                                                          ---------   ---------
Net debt at 31 December (see note 9)                        (3,793)     (3,725)
                                                          ---------   ---------

9. Analysis of net debt

                                         At 31  Cash flow   Non cash      At 31
                                      December              movement   December
                                          2004      £'000                  2005
                                         £'000                            £'000
Cash at bank and in hand                   809        716          -      1,525
Bank overdrafts                        (2,557)      1,707          -      (850)
                                      --------   --------   --------   --------
                                       (1,748)      2,423          -        675
                                      --------   --------   --------   --------
Finance leases                             (2)          2          -          -
Short term bank loans                  (1,000)      1,000    (1,000)    (1,000)
Other loans                              (975)    (3,500)      1,007    (3,468)
                                      --------   --------   --------   --------
                                       (3,725)       (75)          7    (3,793)
                                      --------   --------   --------   --------

The net non cash movement relates to the movement in amortised loan issue costs
during the year.

10. Related party transactions

21st Century Crime Prevention Services Limited ('21st Century'), Mr Paul
Frodsham and Mr Wilson Jennings

Mr Paul Frodsham, Managing Director and 25% shareholder in 21st Century, is the
brother-in-law of Mr Wilson Jennings a main board director and Company
Secretary of TG21 plc.

During the year TG21 plc increased its stake in 21st Century to a 75% holding
having acquired this stake from Mr Paul Frodsham. The company also has options
to acquire the remaining share capital in 21st Century. The total consideration
paid to date in respect of the current holding, excluding costs, is £4.6m and
the option price for the remaining 25% is £2.1m.

On 31 July 2005 the group made a charge of £500,000 to 21st Century for
services provided up to that date. (2004: nil charge but the group sold certain
distribution rights to 21st Century for £850,000 in that year).

Included in creditors of 21st Century at 31 December 2005 is an amount of £
593,649 (2004: £606,556) payable to Mr Frodsham. During the year Mr Frodsham
made a personal loan to Mr Jennings of £32,000. This amount was paid by 21st
Century to Mr Jennings and was accounted for in the books of that company as a
reduction in the amount payable by 21st Century to Mr Frodsham.


The group has taken advantage pf the FRS 8 exemption not to disclose any
transactions or balances between entities of the TG21 plc Group which have been
estimated on consolidation.

11. Publication of non-statutory accounts and basis of preparation

The financial information contained in this preliminary announcement does not
constitute statutory accounts for the year ended 31 December 2005.  The
financial information for the year ended 31 December 2004 is derived from the
statutory accounts for that period which have been delivered to the Registrar
and included an audit report which was unqualified and did not contain a
statement under either Section 237(2) or Sections 237(3) of the Companies Act
1985.  The statutory accounts for the year ended 31 December 2005 will be
finalised on the basis of the financial information presented by the directors
in the preliminary announcement and will be delivered to the Registrar of
Companies following the Company's Annual General Meeting.


a d v e r t i s e m e n t