Date: Thursday 26 June 2008

Embargoed: 7.00am

Slimma plc

("Slimma" or "the Company")

Interim Results

for the 26 weeks ended 28 March 2008

STATEMENT BY THE NON-EXECUTIVE CHAIRMAN, CAROLYN SIMONS

The combination of unseasonable weather conditions, rising household expenditure, falling house prices and adverse credit publicity is, in our opinion, having a negative impact on our customers' purchasing. However, we are making good progress in adapting the business to combat this challenging climate which appears set to continue for some time.

Our primary initiative during the period under review was to achieve a recovery from the significant fall in profits experienced by the Company during the second half of the previous financial year. Management was determined that this fall in profit would not continue during the first half of the current financial year and I am pleased to report that we have succeeded in achieving this.

Our next challenge was to reposition operating overheads in line with the current sales environment. This has entailed re-organisation of the Company targeted at achieving a reduction of approximately £1.5 million of overheads in the current financial year when compared with the previous financial year. Again, I am very pleased to report that excellent progress is being made and by the end of the current financial year, we expect to have achieved this objective. The board anticipates that the full benefits of this re-organisation will be recognised in our next financial year commencing October 2008.

Our focus on margin recovery initiatives is helping the Company to achieve similar margin levels to those achieved in the last financial year and we hope that further projected savings in logistics costs will help counter cost increases in this area of our business.

Our premier brand, Frank Usher, together with its sub brands, successfully avoided the sales problems experienced with the rest of our branded portfolio and retained sales at the same levels as last year. Although this included a significant sales reduction in Italy, Spain and Canada, a strong performance in sales to UK independent shops produced a sales increase, when compared to the same period last year, in excess of 6%, which served to offset the export loss.

The remainder of our brands experienced disappointing sales falls of between 16% and 30% when compared to the same period last year. Mail Order was worst effected, with trade customers tightening their buying budgets and stock controls in view of the deteriorating economic climate. We are currently interviewing both our branded agents and retail customers to aid us in constructing revised marketing plans and sales initiatives to match the current trading environment and to help ensure no further sales loss occurs as we form a new platform for growth.

Export sales for the period were 30.2% of total sales and remain an important feature of our business.

Given that savings on expenses and margin recovery initiatives will not be fully realised until the commencement of our Spring/Summer 2009 selling period, the Company faces challenging trading for the remainder of the current financial year. Despite this, we are cautiously optimistic that we can return a much improved result for the new financial year commencing October 2008.

  Interim Income Statement  

For the 26 weeks ended 28 March 2008 

Statement of recognised income and expense

  Balance Sheet

As at 28 March 2008

  Cash Flow Statement

For the 26 weeks ended 28 March 2008