CPC City Pub Group Plc (the)

RNS Number:9505A
Capcon Holdings PLC
10 September 2002

The Board of Capcon Holdings plc ("Capcon") announces that, despite the general
economic slowdown, during the current financial year ending 30th September 2002
the original core divisions of audit, stocktaking and commercial investigations
are on track to achieve sales growth of approximately 3%, while group revenues
have increased in line with expectations. Regrettably, one client in the leisure
sector experienced serious trading difficulties and appointed liquidators. This
has resulted in lost profit of approximately #90,000 due to lost sales revenue
and the provision of for the potential bad debt. In addition the Group also
experienced some delays in setting up new contracts. Although most of the
expected new stocktaking work has now commenced, the revenue contribution in the
year to 30th September 2002 will not be as high as had been originally expected,
even though costs were incurred in anticipation of those specific contracts, the
benefit of which has now been partly deferred to the next financial year.

The Directors believe that the prospects for the next financial year are very
encouraging and they anticipate that a significant improvement can be achieved.
However, it is expected that, whilst the actual reported pre-tax profit for the
year ended 30th September 2002 will be significantly ahead of the previous year,
it will fall short of expectations, principally due to the deferral of the start
of new business, caused by recent economic conditions.

Prior to acquisition on 8th April 2002, Vincent Sherman (Creditor Claims)
Limited ("VSA"), a specialist insurance fraud investigatory business, was
incurring substantial losses but its integration has been highly successful and
a significant turnaround has been rapidly achieved through increasing sales to
major blue chip insurers as well as operational efficiencies. VSA is now
expected to commence the next financial year in profit, with sales continuing
the upward trend, although it will show a small loss of approximately #50,000
for the period to 30th September 2002.

Ken Dulieu, Chairman said:

"The Group's strategy continues to be focused on organic growth that can be
significantly enhanced through acquisition of quality risk management and
investigatory businesses in areas where the Directors have specialist
experience. Although several targets have failed to meet strict quality and due
diligence criteria over the past twelve months, the Group is currently pursuing
a number of possible acquisition opportunities. At the same time, the smooth
integration of VSA in less than six months demonstrates how Capcon's expertise
can effect a rapid turnaround, creating sustainable sales and profit growth".

Enquiries:

Ken Dulieu                     01372 869 706

Paul Jackson                   020 7417 0417



                      This information is provided by RNS
            The company news service from the London Stock Exchange
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