Preliminary Results for the year ended 31 March 2008
Proventec Plc (AIM:PROV, Alternext:ALTPC), a provider of specialist steam cleaning and coatings technologies, today announces its Preliminary Results for the year ended 31 March 2008.
Highlights
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Group turnover up 188% to £14.32 million (2007: £4.96 million)
Adjusted* profit after tax increased by £732,000
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Sales of steam cleaning technology, used to combat superbugs, have increased by over 35%
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EBITDA increased to £2.51 million (2007: £2.26 million). Adjusted* EBITDA increased by 114%
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Acquisition of 80% stake in Contico Manufacturing Limited
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OspreyDeepClean Limited awarded status of sole supplier of specialist steam cleaning equipment by the UK NHS Purchase and Supply Agency

*adjusted for sale of investments

Post year end highlights
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First AIM company to dual list on NYSE Euronext's Alternext

David Chestnutt, Chief Executive of Proventec, commented: "This has been a significant year for the Group. The acquisition of Contico has taken our revenues and breadth of distribution to a higher level. The recognition of the NHS award was an important milestone for the Group and as a result we have seen a significant increase in the sale of our machines into the healthcare sector. Our dual listing on Alternext has given the Company greater access to European investors and we have already seen encouraging results from this. The Group is now posed to maximise on the number of growth opportunities ahead."

more info on, www.proventecplc.com


Chairman's Statement
This has been a significant year for Proventec and I am pleased to report the continued expansion of the Group, particularly following the acquisition of an 80% stake in Contico Manufacturing Limited ("Contico") in June 2007.

Operations
The demand for the technology developed by OspreyDeepClean Limited ("Osprey") continues to grow around the world. The company has designed a range of proprietary dry steam cleaning equipment and tooling specifically for the healthcare sector, which has positioned Osprey as a recognised leader in this field and brought significant expansion opportunities to the Group. Osprey's unique equipment is the only validated technology that has the full data to substantiate that we can achieve a viable method of surface disinfection, to support proactive infection prevention and control, yet which allows patients to remain on the wards. The roll out of our Osprey operations in other countries is a major part of our strategic plan for growth and continues apace, with new routes to market.

In our coatings division, the Magma flame retardant business is continuing its work with other manufacturers to develop new products. In particular discussions are underway for a commercial collaboration with a European timber treatment company, a division of a major European conglomerate, which will distribute Magma's products.

Alternext
In December last year, after conversations with some of our major mainland European investors, we took the decision to dual list the Group on Alternext, a market operated by NYSE Euronext, in Paris. With our shareholders' support, the listing was completed and Proventec was admitted to trading on 22 May 2008. Proventec was the first AIM company to dual list on Alternext and the Group has already witnessed increased investor interest from outside the UK. We believe this listing will continue to give Proventec access to mainland European capital markets which, in turn, gives the Group greater flexibility.

As part of this exercise Proventec raised £4.06 million in January by an issue of 8.5% convertible / redeemable Loan Notes. These funds will be used to further expand the Group's trading activities during 2008. We are seeking to acquire the controlling interest in a complimentary, small equipment manufacturing company in Germany. We are also looking at other specialist cleaning technologies in the Benelux countries. As part of our dual listing it is our intention to list the Loan Notes on the Alternext market.

The Group's share price is now quoted both in pounds sterling on AIM and Euros on Alternext. Our website www.proventecplc.com carries direct stock market feeds from both markets.

Appointment
In September last year, Nick Whiteley, an experienced commercial lawyer, joined Proventec as Company Secretary. Nick is an important addition to our management team and his experience in European business legislation has already proved invaluable to the Group.

Finally I would like thank the Group's employees for their hard work in driving the Group forward during the last year. The Board is pleased with the Group's development and I look forward to reporting further growth in 2008 and 2009.

Peter Teerlink
Chairman
Chief Executive's Report
I am pleased to report the results for the year ended 31 March 2008 in what has been an extremely busy twelve month period.

Financial Highlights
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Group turnover up 188% to £14.3 million (2007: £4.96 million) following acquisition of Contico
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Osprey group turnover has increased by over 35%
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EBITDA increased to £2.51 million (2007: £2.26 million)
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Raised £4.06 million by an issue of 8.5% convertible / redeemable Loan Notes in January 2008
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The Group's cash balances at 31 March 2008 stood at £4.04 million

OspreyDeepClean
OspreyDeepClean Limited ("Osprey") specialises in dry steam cleaning technology, which effectively sanitises an area without the use of chemicals, instantly removing all germs and bacteria including MRSA, Clostridium difficile and E-coli. The technology provides higher standards of cleanliness compared to conventional methods and it is also more environmentally and economically friendly, providing considerable savings in water and chemical usage.

In November 2007, the most detailed and complete healthcare report to date on hygienic cleaning without the use of chemicals, was prepared by University College Hospital London. This study into the efficacy of bactericidal cleaning, in conjunction with Osprey's dry steam equipment and specialist tooling, has set new standards for hospital hygiene and redefined 'clean'.

Following peer review by TNO, a European testing house based in Amsterdam, this report was signed off in March 2008 and is due to be published later this year. The results have already been welcomed by all parties in the healthcare sector that have an interest in bactericidal cleaning.

The results of the report have been presented at a number of healthcare conferences. Presentations have also been made to some of the leading advocates in the Infection Control arena including Professors and Directors at major hospitals in the UK, Holland, France, Canada, United States of America and Saudi Arabia. These presentations have led to a number of commercial discussions in all these countries.

At the same time, early in 2008, Osprey was nominated as the sole supplier of specialist steam cleaning equipment by NHS Purchase and Supply Agency. As a result, the sales of machines into the healthcare sector have increased dramatically in the first quarter of 2008, largely helped by the UK Government making additional funding available for deep cleaning of hospitals across the country.

Legislative pressures and performance targets in the UK are encouraging hospitals and trusts to recognise the importance of maintaining high standards of cleanliness. Such levels can be achieved by dry steam cleaning on a regular and daily basis. The new Osprey specialist tooling accessories, together with the company's standard operating procedures and manuals, have enabled Osprey to establish itself as the leading provider in this sector.

Osprey continues to seek new markets in the healthcare sector in Europe and the Middle East. In March this year, the Group signed a licence with a private Japanese hospital group that, we believe, will lead to substantial orders over the next four to five years in Central Europe and Japan.

Beyond the healthcare sector, the sale of our dry steam cleaning machines continues in the multitude of countries in which we have distribution channels. Industries such as hospitality, food manufacturing and retail are looking for cost effective means of superior cleaning. In particular we continue to achieve success in the US commercial food factory market where standards of hygiene are increasingly being driven by consumer concerns.

Contico Manufacturing
Contico Manufacturing Limited ("Contico"), in which the Group acquired an 80% stake in June 2007, has provided a significant contribution to the Group's financial results. Contico is a manufacturer and distributor of cleaning and hygiene equipment and has an excellent reputation in its field. Although the cleaning market, including janitorial supplies, is typically conservative, Contico has developed its business over the past twelve months and during this time has shown steady growth.

Like many businesses in the UK the company has seen considerable cost pressures due to the high cost of fuel which effects transport, distribution and the raw material cost of plastic products. Additionally the strength of the euro against sterling has increased the cost of many imported products. However, Contico is continually sourcing new and innovative products and intends to expand its business into Europe using the connections and relationships within the Group.

BioCote
BioCote Limited ("Biocote") a company in which the Group has a 31% stake, offers a coating technology based on a silver additive. BioCote treated products have a higher resistance to the development of bacteria and BioCote can be seen as a second line of defence against community acquired infections, after cleaning. BioCote took part in a study with the Heart of England NHS Foundation to compare two out-patient wards. The first ward contained furniture and equipment incorporating BioCote's anti-bacterial protection. The second ward contained standard and non-treated items. The results from the trials show that the facility using BioCote had 95.8% less bacteria in the environment than the ward with no silver based products. BioCote's silver additive gives the product built-in anti-bacterial protection and can be incorporated into a variety of materials including plastics, fabrics, paints, powder coatings and papers.

As a Group we are developing a number of other products to further our comprehensive bactericidal cleaning offering to the specialist hygiene sector.

Preventative Coatings
The Magma coatings division based in Rotterdam has continued to develop its range of Magma Firestop products in conjunction with Firestop Chemicals Limited ("Firestop"), an investment held by the Group. It now has an extensive range of flame retardant products that are applied as a post-manufacturing treatment to products, such as Christmas trees, roofing thatch and timbers including plywood. The company has also developed a range of flame retardant paints, including latex paint. The company is seeking to distribute its products through companies and groups that already have established routes to market. Magma is also working on a flame retardant system for a programme of renovation and new-build for schools in Scandinavia.

Firestop has sourced alternative manufacture of Noflan, the flame retardant for fabrics, from an Indian manufacturer. The development of manufacturing facilities for Bizon, our flame retardant for polymers, is continuing.

Innoshield, an ultraviolet preventative coating, is being trialled as a protective and restorative treatment for fibreglass in the marine sector. It also, in conjunction with another product, has properties as a paint system for inhibiting rust, a valuable property for multiple large industries. We expect this to lead to commercial developments in 2009.

Conclusion
The last year has seen considerable consolidation within the Group and the laying of solid foundations for our development and future growth.

Over the next twelve months we expect to see continued growth in the Group, especially with our proven dry steam cleaning technology as it receives further credence and acceptance from the key decision makers in the healthcare and food industry markets.


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