30 September 2008

Supercart plc

("Supercart" or the "Company")

Mike Wolfe, Chief Executive, commenting on the results said:

"I continue to be encouraged with growth in our South African core market and I believe that we are well positioned with good product in our main North American and European markets. 

With the introduction, later this year, of our seventh trolley world-wide, which will be sold into the South African and European markets, I believe that Supercart remains well positioned with a unique range of products that meet the growing world retailer demand for recyclable and recycled commodities to satisfy their corporate social responsibility goals."

Enquiries:

Mike Wolfe, CEO Supercart plc                                                                           01732 459898

Russell Cook, Charles Stanley Securities (Nominated Adviser)                         020 7149 6000

  Chairman's Statement

Progress in the first half of the current year has been steady. Revenues have risen and despite higher oil prices, we have increased our margins on product sales. Revenues are still driven by our operations in South Africa as the Company continues to strive to make a significant breakthrough in the main target markets of North America and Europe, which hopefully is becoming ever closer.

Financial Results

Turnover of £1,032,000 (2007 - £822,000) was 26% higher than the comparative period in 2007 primarily due to our continuing strong performance in South Africa. While gross margins rose from 16.7% to 22.6% the operating loss for the period increased to £725,000 (2007 - £578,000). This was as a result, primarily, of increased marketing and selling costs in North America and Europe, incurred in readiness for our new products. Losses before tax were £724,000 (2007: £593,000).

The Company continues to control carefully its operating cost base to optimise its cash resources. The Company maintained a positive cash balance of £469,000 at 30 June 2008 (2007 - £552,000). 

Our 30 litre hand basket continues its high levels of acceptance across all of the retail groups and is selling at significantly increased levels from 2007.

Our store tests in France have been successful thus far, and we have recently received a further order from one of the retailers concerned.  We are also following up interest in the Nexus in both Spain and Germany.

Manufacturing costs

Although the price of raw material resins has increased by up to 25% in the last 12 months, world steel prices have increased even more significantly by up to 100% over this period. With the high capital cost and introductory lead time for each of our trolleys, our cost base has always been higher than our competitors' metal products. However, with the dramatic rise in the cost of steel, our products are beginning to become increasingly competitive. 

Product development

We have completed successfully the off tool trials of our latest trolley, the 'Excel 200' which will serve the South African and European markets. In Europe it will meet the demand of the retailers who want a trolley size between our current 145 litre Nexus and the 225 litre Hyper. With final mould commercialisation work happening in South Africa through to the end of October, we anticipate that sales of the Excel 200 will commence in South Africa at the end of 2008 and in Europe in early 2009.

Outlook

The final quarter is traditionally the strongest part of our year. With our extended product range, and our new and ongoing sales initiatives, we are expecting progress in our markets during the second half of 2008.

              Condensed Statement of changes in equity