Millbrook Scientific Instruments plc

('Millbrook' or the 'Company')

Interim Results

Millbrook Scientific Instruments plc (AIM:MBK), the designer and manufacturer of innovative scientific instruments that measure nanoscale properties of thin films and coatings, announces its Interim Results for the six months ended 30 September 2008.

Overview (continuing operations)

• Revenue of £1,313,998 (2007: continuing operations £1,013,219). A significant increase over last year. 

• EBITDA £74,564 (2007: continuing operations loss of £(73,853)) - a marked improvement due to increased sales and full effect of reduction in overheads.

• Sale of Aquila completed with effect from 18 June 2008.

• Move to new premises at Wrexham complete.

• Rollout of software upgrade for MiniSIMS ToF complete.

• First release of the software upgrade for MiniSIMS alpha completed - first two instruments with the new software now shipped.

• Total Group sales for FY2009 plus outstanding orders £2.4m at 11 December 2008 
  (£2.4m from continuing operations at 13 December 2007).

• Other priorities for the remainder of the Financial Year:

  • Complete improvements to production processes at Blackburn to ensure production and quality targets are reliably met;

  • Environmental enclosure for NanoTest;

  • Data analysis software for MiniSIMS.

• Economic conditions:

  • Demand for products unaffected to date;

  • Weakness of pound is generally beneficial although some supplies are sourced in other currencies.

Chairman's Statement

Revenue for the six-month period ending 30 September 2008 was £1,313,998 (2007: continuing operations £1,013,219). The increase in revenue compared to 2007 was mainly due to increased sales and production at our new Wrexham facility. The operating profit from continuing operations for the period was £28,162 (2007: loss of £(113,021)). This improvement was due to the increase in sales referred to above and the effect of the reduction in overheads previously announced.  

During the period under review, sales and orders of the NanoTest instrument have progressed satisfactorily. Continued steady growth is anticipated now that the constraints of space at the previous facility in Wrexham have been removed. Our thanks are due to our employees at Wrexham who worked tirelessly to achieve the move with minimum disruption to production.

The new software for both MiniSIMS ToF and alpha instruments is now complete. The roll out of the ToF upgrade is complete and the first two shipments of the alpha with new software have taken place. Improved data analysis software is also being developed this year. An environmental enclosure for the NanoTest instrument is under development at our Wrexham facility.

New orders have been achieved such that total group sales for FY 2009 to date plus outstanding orders at 11 December 2008 are £2.4m. The Board is clearly aware of the worsening economic climate and continues to monitor its effects on the business. Opportunities can be created in such a climate and the weakening pound is generally helpful to the sales effort. Currency fluctuations are hedged to the extent the Company's limited financial resources permit.

Shareholders will have noticed the weight of paper enclosed with the Annual Report for FY2008. Following the implementation of further sections of the Companies Act 2006 on 1 October 2008, the second new set of Articles of Association (part 5, item 'B' of the Notice of AGM papers) are now in force. This will enable us to keep printing and postage costs to a minimum in the future.

Committees

The Audit and Remuneration Committees met once each in the period under review under the Chairmanship of Malcolm Fortnam. My grateful thanks are due once again to Malcolm for carrying out this role.

Our thanks are due to Edwards Veeder (Oldham) LLP, our auditors, for their assistance.

Other Advisers

We appointed Zeus Capital of Manchester as our Nomad and Broker effective 19th November 2008. I would like to express my thanks and those of the Board to Seymour Pierce, our Nomad since listing on AIM, for their advice and support over the years. Our legal advisers, Halliwells LLP, provided excellent help and advice throughout the period including assisting us to update our Articles of Association to ensure compliance with CA 2006.

Board

The Executive members of the Board carry a heavy burden of responsibility and my thanks are due to them for the cheerful and diligent manner in which they carry out their duties, especially Paul Grasske the Group CEO.

Stephen M Blank

Chairman

  CONDENSED GROUP INCOME STATEMENT

for the six  months to 30 September 2008

  CONDENSED GROUP INCOME STATEMENT continued

for the six  months to 30 September 2008

Earnings Before Interest, Tax and Depreciation and Amortisation ('EBITDA')

  CONDENSED STATEMENT OF CHANGES IN EQUITY

  CONDENSED GROUP BALANCE SHEET

for the six months to 30 September 2008

149,628

115,932

155,474

  CONDENSED GROUP STATEMENT OF CASH FLOWS

for the six months to 30 September 2008

  NOTES TO THE UNAUDITED ACCOUNTS

for the six months ended 30 September 2008

• BASIS OF PRESENTATION OF ACCOUNTS

Millbrook Scientific Instruments PLC is incorporated in England and Wales. The condensed Group half-year financial statements consolidate those of the Company and its subsidiaries. They do not include all of the information required for full annual financial statements.

The half-year results are unaudited. The summary of results for the year ended 31 March 2008 is an extract from the published consolidated financial statements of the Group for that period which were prepared in accordance with IFRS as adopted by the European Union, and which have been reported on by the Group's auditors and delivered to the Registrar of Companies. The report of the auditors was unqualified.

The Group's subsidiary, Aquila Instruments Ltd, was sold on the 18 June 2008. Aquila has been treated as a discontinued operation in these financial statements, however when the interim statement for the six months ended 30 September 2007 was prepared Aquila was still a continuing operation. The comparative figures for September 2007 have been restated to reflect the fact that Aquila is now a discontinued operation.

2.    EARNINGS PER ORDINARY SHARE

The earnings/(loss) per share (basic and diluted) has been calculated on the result after tax attributable to the ordinary shareholders and the weighted average number of shares in issue in the period.

At 30 September 2008 and 30 September 2007 there were 73,657,416 ordinary 1p shares in issue.

3.     TAX REFUND

The tax refund relates to claims for Research and Development tax credits that have been submitted to HMRC.

  4.    EXCEPTIONAL ITEMS

The following expenses are included in the Income Statement under 'Other expenses':

5.    DISCONTINUED OPERATIONS

One of the Group's subsidiary companies, Aquila Instruments Ltd, was sold on the 18 June 2008. The sale was fully anticipated when the accounts for the year ended 31 March 2008 were drawn up and provision was made in those accounts for the loss and costs of the disposal. However the loss on disposal has not been as great as anticipated and £22,281 of the loss has been released to the Income Statement.

6.    RECONCILIATION OF INCOME FOR PERIOD TO NET CASH INFLOW FROM OPERATING ACTIVITIES

  7.    RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS/(NET DEBT)

8.    ANALYSIS OF NET FUNDS    

  For further information:

  Independent Review Report to Millbrook Scientific Instruments PLC

We have been engaged by the Company to review the condensed consolidated financial statements in the Interim Report for the six months ended 30 September 2008, which comprises the consolidated income statement, consolidated statement of changes in equity, consolidated balance sheet, consolidated cash flow statement and 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 information in the condensed consolidated financial statements.

This report is made solely to the Company in accordance with guidance contained in International Standard on Review Engagements 2410 (UK and Ireland) 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our work, for this report, or for the conclusions we have formed.

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 rules of the London Stock Exchange plc for companies trading securities on the AIM market which require that the half yearly report be presented and prepared in a form consistent with that which will be adopted in the Company's annual accounts having regard to the accounting standards applicable to such annual reports.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed consolidated financial statements in the Interim Report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review we are not aware of any modifications that should be made to the financial information as presented for the six months ended 30 September 2008 or of any instances where the financial statements fail to comply with the rules of the London Stock Exchange for companies trading securities on the AIM market.