Final Results

30 June 2011

Hampson Industries PLC

Preliminary results for the year ended 31 March 2011

Hampson Industries PLC ("Hampson" or "the Group") the international aerospace group announces preliminary results for the year ended 31 March 2011.

Corporate highlights

·; Return to revenue growth - 17% increase year on year, 21% increase on a constant currency and like for like basis

·; Record tooling contract secured in September 2010 progressing to schedule and within budget

·; Results impacted, as previously announced, by operational issues at the Michigan facilities. £34.6 million impairment of goodwill charged

·; Operational improvement strategies being implemented including strengthening of management positions and further deployment of SAP

·; Quotation pipeline for Aerospace Composites & Transparencies businesses remains strong, although timing of conversion remain difficult to predict

·; Disposal of non-core automotive turbocharger business in June 2010. Subsequent litigation issues resolved in June 2011

·; Covenant amendments to committed borrowing facilities for the next 12 months to provide more flexibility as part of recovery plans

·; Continued strategic priority to reduce the Group's current level of indebtedness

·; Discussions regarding disposal of certain non-core assets at an advanced stage

Financial highlights

* Trading profit, profit before tax and earnings per share are all stated to reflect the continuing operations of the Group before restructuring and rationalisation charges, impairment charges, gains and losses on disposal or closure of businesses, changes in the net fair value of financial instruments and amortisation of intangible assets on acquisition. The Directors believe that exclusion of these items allows trends in the performance of the Group's continuing business to be more easily identified and understood.

Commenting, Chairman Chris Geoghegan said:

"In the face of strong macro-economic headwinds and industry pressures we have grown Group revenue, although we have experienced a number of operational challenges, primarily at our Michigan facilities, that have significantly impacted our profitability. We are focussed on increasing our operational effectiveness to improve cash generation and margins. A number of initiatives are underway and an on-going focus on cost reduction is being implemented throughout the Group to drive a return to improved results in the year ahead. In the first two months of the year we have traded in line with our expectations, although a degree of caution is required due to ongoing difficulties in predicting pipeline conversion and the speed with which the benefits derived from operational improvements are achieved within our businesses.

We are encouraged by the on-going success of the Group's largest ever tooling contract, which has given the Group a stronger footing with our customers on the complete design and manufacture of larger, more complex contracts, which are generally at higher profitability levels.

The Board is confident that the strategic path taken by the Group is laying solid foundations for growth over the medium to longer term. We also remain well positioned to exploit longer term growth trends from increasing composite usage in the industry."

Further information:

Norman Jordan, Chief Executive +44 (0)1384 485 345

Ram Swamy, Finance Director +44 (0)1384 472 946

Marylène Guernier/Ann-marie Wilkinson, M:Communications +44 (0)20 7920 2369

Chairman's Statement

Results

Revenue from continuing operations for the year ended 31 March 2011, increased by 17% year-on-year. On a constant currency, like-for-like basis, the equivalent increase was 21%.

Whilst a return to a year of revenue growth is welcomed, as we indicated at the half year, results in 2010/11 have been held back by legacy issues at our Detroit based tooling operations. A considerable amount of management time has been absorbed in 2010/11 in addressing these issues which have been more extensive than first thought and it is pleasing that we are now seeing the early signs of improvement. Notwithstanding our expectations of improving results, we have considered it appropriate to impair the carrying value of goodwill of these businesses by £34.6 million.

Trading profit from continuing operations declined, as a result of the issues referred to above, by 46%, and adjusted profit before tax*, at £10.8 million, was 57% lower. Adjusted earnings per share ("EPS") declined to 5.99p, with statutory EPS, after asset impairments and non recurring items of (4.83)p (2009/10: 9.98p).

Deploying effective and lasting solutions in our Detroit based tooling operations has been and remains our main priority. One of the key steps has been the introduction of new IT systems at our Odyssey site providing a solid platform for our on-going improvement and lean manufacturing initiatives. We have also restructured and strengthened our operational teams in North America bringing further skills, experience and capacity to our existing management pool.

Whilst we have more work to do, the Board has confidence that we are on the right track and that acceptable results will be restored.

The majority of businesses within our portfolio have returned improved results in 2010/11 compared with the previous year. Coast Composites, in particular, has delivered extremely strong growth whilst successfully expanding its technical offering into the lay-up of large-scale, tightly toleranced carbon structures. Over the period we have owned it, Coast has now delivered compound average annual revenue growth of 27%.

The major contracts we have secured during 2010/11 have confirmed that our strategy remains sound. Our push into composites continues to open opportunities for growth, and, against the backdrop of rising demand for advanced, lightweight structures in both airframe and aero engine applications, we aim to continue to leverage the full strength of our combined technical capabilities in both tooling and component manufacture for our customers.

Capital Structure and Liquidity

The Group's net debt as at 31 March 2011 was £92.9 million, which represented a reduction of over £6 million from the position reported as at 31 January 2011.

The Group has agreed with its lenders amendments to its existing committed borrowing facilities. For the next four quarters the leverage ratio will now be 4.25 times (compared with 3.00 times to 4.17 times previously), and the interest cover covenant will now fall in the range 1.70 times to 2.80 times (compared with 2.70 times to 3.50 times previously). This will provide increased covenant headroom over the next 12 months and give the Group more flexibility as it progressively improves performance. As this occurs, the Group will also look to align its financing structure more closely with the underlying base currency cash flows of the Group and its geographical footprint.

As outlined in previous statements, the reduction of net borrowings remains a priority for the Group. Following a strategic review of the Group's business portfolio earlier in the year discussions are, as previously reported, proceeding with a third party aimed at the divestment of certain non-core assets. These discussions are now at an advanced stage and further information will be announced accordingly.

Automotive Disposal

During the year the Group disposed of the Automotive Turbocharger business. This transaction was subsequently subject to litigation. Although we were disappointed with the way this reflected on the Group and with the outcome of the litigation, we are pleased it has now been resolved.

Board Composition

Norman Jordan, a U.S. national, joined the Board of Hampson on 1 September 2010 as Group Chief Executive. The Board is confident that Norman's track record of operational excellence will serve the Group well as we target a return to profitable growth.

Howard Kimberley, the Group's Finance Director, stepped down from the Board on 10 June 2011 after ten years with the Group, and was succeeded by Ram Swamy. I would like to thank Howard for his dedicated service as Finance Director of the Group over the past ten years and welcome Ram to the Group. Ram has an impressive track record and I am confident that his skills and experience will be invaluable to the Group at this important stage in its development.

Dividend

In light of the Board's strategy to reduce the level of indebtedness of the Group, the Board does not recommend that a final dividend be paid in respect of the year ended 31 March 2011 (2009/10: 0.90p).

Outlook

The current outlook for the Group's principal markets is generally favourable, although the timing of conversion of certain larger opportunities in tooling into production orders remains difficult to predict.

With management's on-going focus on cost reduction activity, together with the restructuring and improvement actions implemented in 2010/11, the Board is optimistic about positive progress and improved results in the year ahead.

C V Geoghegan

30 June 2011

*In addition to the "statutory" measures of profit, reference is made throughout this document to the impact on the continuing Group's profit before tax and earnings per share of excluding the following items; restructuring and rationalisation charges, impairment charges, gains and losses on disposal or closure of businesses, amortisation of intangible assets arising on acquisition, changes in the net fair value of financial instruments and the results of discontinued operations. The Directors believe that exclusion of these items allows trends in the performance of the Group's continuing business to be more easily identified and understood. Reference is made throughout to the terms "trading profit", "adjusted profit before tax" and "adjusted earnings per share", which are defined, respectively, as operating profit, profit before tax and earnings per share adjusted to exclude all of the fore-going items.

Chief Executive's Statement

Performance

The year ended 31 March 2011 has been one of significant changes at Hampson and, despite a number of challenges, we have delivered a robust set of trading results before non-recurring items.

I am pleased, in particular, that we have increased our revenue by 21%, on a constant currency, like-for-like basis, in spite of some considerable difficulties at the beginning of the year.

As we indicated at the half year stage, our results in 2010/11 have been held back by performance issues in one of the businesses within our Aerospace Composites & Transparencies division. We have taken the necessary steps to address these performance issues and while recovery remains at an early stage, we are starting to see tangible, measurable progress in a number of important areas.

We have made good headway on a number of important initiatives across all of our businesses during the year. We have strengthened and restructured our management teams, brought a new focus on lean manufacturing initiatives and achieved some notable commercial successes that I am confident will lead to continuing forward momentum. These actions will provide us with a robust base on which to continue to build for the future.

Since I joined Hampson on September 1st, I have been impressed by the quality of our businesses, their obvious potential, and the skill and expertise of our people. I have also been impressed with the technology and manufacturing capability we are able to deploy as industry leaders. Our strategy is sound, and our challenge now is to operate at continually higher levels of efficiency with a relentless focus on cost reduction and to ensure that we use our valuable assets to their full potential.

Our record tooling contract, secured in September 2010, is a testimony to what Hampson can achieve. This is a technically complex and highly demanding contract that has involved close teamwork between all five of the businesses within our Composites & Transparencies division. I am delighted that it is progressing to schedule and within budget. Our success on this major program will consolidate our leading position in major composite tooling design and manufacturing.

We operate in an industry with attractive characteristics, forecast industry growth trends and with our focus on the rising market demand for composites. We are well positioned to grow by adding value to our global customer base as they embrace related technology changes in aircraft design and manufacture. We will do this through collaborating closely as partners through the design, manufacturing and installation phases of our products, and by acting with speed, efficiency and decisiveness to further differentiate our offering from that of our competitors.

Markets

Commercial aerospace markets are in the early phases of what we expect will be a strong cyclical upswing that should last for at least several years. Both Boeing and Airbus have announced progressive increases in planned production rates across almost all major programmes covering the period out to 2013.

Over the medium term, we expect the regional (100-180 seat) jet market to expand, assisted by the availability of new, more fuel efficient engine technologies. These new technologies will power not only Bombardier's new CSeries, but also important new programmes from MHI (Japan), Comac (China), Superjet International & Irkut (Russia) and the recently announced Airbus A320 NEO which are all presently in the design, development or initial certification and delivery phases. From both a tooling and component supply perspective, these programmes represent exciting opportunities for Hampson's businesses.

In military aerospace we expect demand to vary across programmes in the shorter term depending on operational need, with budget pressures across the US and Europe adversely impacting some existing programmes. The important F-35 programme, to which the Group supplies both component and assembly tooling systems, as well as advanced, lightweight high temperature composite engine components, will continue to see a progressive increase from low initial production rates.

After a long period of decline, the business jet market is now starting to show signs of what we expect will be a slow but steady recovery. New, innovative, programmes such as the HondaJet and PiperJet Altaire, both of which will be manufactured using tooling systems engineered and supplied by Hampson, are likely to have a further positive bearing on the demand outlook for this sector through offering attractive economics of ownership and enhanced levels of comfort and performance.

Alongside this generally favourable industry background, demand for aerospace tooling should remain robust for the directly foreseeable future. The principal drivers of this will remain the A350, B787 and F-35 programmes, all of which are expected to continue to give rise to strong demand for production rate and derivative tooling requirements. New regional and business jet platforms will also contribute attractive opportunities going forward, together with further tooling demand arising from engine upgrades, airframe modifications and new, state-of-the-art, automated aircraft assembly facilities.

Strategy

Our strategy going forward is a simple one: to focus on improving our operational effectiveness, simplifying our business processes to reduce cost, reducing our direct and indirect supply chain costs, move with greater speed, and ensuring we leverage, to the fullest, our strengths as a market leader in our sector.

We will do this by providing the best possible value to our global aerospace customers and delivering superior technical solutions, a more collaborative, partnership-based approach and the more effective sharing of knowledge and best practice across our entire organisation. This will be supported by continued heavy emphasis on lean manufacturing disciplines and the promotion of a one team culture.

China and India are becoming increasingly important markets for aerospace suppliers. The continued internationalisation of our business to ensure we are in the best possible position to take full advantage of the growing opportunities in these regions also forms a further important element of our strategic focus.

Our people

Despite the many challenges we have faced in 2010/11 and the difficult decisions we have at times had to take during the year, the commitment and dedication of our people has been outstanding. I would like to take this opportunity to thank them all for their efforts and pay tribute to their professionalism.

Outlook

Although some short term challenges remain, I am confident that the actions we have taken and those we continue to pursue, have laid the foundations for a return to sustainable growth and higher levels of performance going forward.

N D Jordan

Chief Executive

30 June 2011

Business Review

Aerospace Composites & Transparencies

Employing approximately 1,000 people across five facilities in North America, Hampson's know-how and technological expertise in advanced materials and tooling is continuing to play a key role in the development and production of some of the world's most advanced and evolutionary aerospace programmes. Hampson is now the world's largest independent supplier of highly engineered, close tolerance tooling systems for the fabrication and assembly of both metal and composite structures for commercial and military aircraft and space applications. Combined with its expertise in the fabrication of carbon composite structures, Hampson's Aerospace Composites & Transparencies division is well positioned to offer a unique value proposition to its global customer base.

From design to manufacture, the activities of Hampson's Aerospace Composites & Transparencies division extend from the engineering and fabrication of large very close tolerance tooling systems for composite wing and fuselage structures, to the manufacture of high performance components and structures in advanced, lightweight materials for a range of applications. These include latest generation military aircraft and anti-ballistic transparencies, moulded thermo-plastic assemblies, composite components for internal and external airframe structural applications, and complex, high temperature composite components for high performance aero-engine applications.

The year ended 31 March 2011 saw an increase in divisional revenue of £35.9 million (30%) to £157.3 million, and a reduction in divisional trading profit by £11.2 million (38%) to £18.1 million. The growth in revenue was driven primarily by increased activity at California-based Coast Composites Inc. ("Coast"). Overall results for the division were, however, held back by the performance of one of the Michigan-based operations, Odyssey Industries Inc. ("Odyssey"), as reported at the half year stage.

Coast delivered outstanding results in 2010/11, with a doubling of revenue contributing also to improvements in operating margins as the result of greater operating efficiencies.

With an expanded technical offering now extending to the manufacture of tooling out of high temperature composite materials, Coast was successful, as lead Hampson site, in securing the Group's largest ever tooling contract for a major commercial aerospace programme, in September 2010. This had a revenue value in excess of USD53 million and will continue to benefit results in 2011/12.

Key to this win was Hampson's ability to provide a technically advanced, light weight solution whilst delivering to a very demanding schedule. This was achieved by harnessing the combined capacity and capability of all five of the division's operations; Coast, Odyssey, Global Tooling Systems ("GTS"), Composites Horizons ("CHI"), and Texstars.

Success with this major contract was combined with the delivery of further critical suites of tooling to Airbus for the A350 programme, again, under a very challenging customer schedule. In particular, large upper and lower wing skin moulds were built in sections, shipped to Europe, and assembled by crews on-site using Coast's patented laser welding process.

Global Tooling Systems, Inc. ("GTS"), one of the two divisional businesses based in Michigan, had an improved year, achieving growth in revenue of 45% compared with 2009/10. Increased tooling requirements in relation to the A350, B747-8, F-35 and Gulfstream G650 programmes were particular factors driving this growth.

Profitability was, however, held back by a combination of issues which impacted overall operational efficiency. Chief amongst these was a consistent pattern of changes in customer scheduling requirements which resulted in higher subcontract and overtime costs being incurred, particularly in the early part of the year. Some, but not all, of these costs were able to be recovered from customers. The planned implementation of SAP during the first half of 2011/12 is expected to help manage these issues.

As reported at the half year stage, Michigan-based Odyssey was adversely impacted by a number of management and operational issues over the year, which led to a decline in volumes, a degradation in performance and the incurrence of a trading loss for the full year.

Having taken the necessary steps to address these issues, the turnaround in Odyssey's performance is now underway and improved results are starting to be seen. A new, experienced management team has been deployed, and the successful implementation of best-in-class systems has set a more robust framework to drive major changes. Business improvement activities are being targeted in a number of areas and are being supported by best practice sharing from other Hampson operations.

Recent indications based on customer feedback, delivery and quality metrics for the Odyssey site have been positive. These provide greater confidence that the initiatives and improvements being driven by the new management team should lead to improved results going forward.

Following its recent capacity expansion, California-based Composites Horizons Inc. ("CHI") delivered strong results in 2010/11 with revenue up by almost 25% compared with 2009/10 and margins increasing with successful operational improvement initiatives. This improved performance was weighted heavily towards the second half of the year, with this trend expected to continue into 2011/12. Revenue growth was the result of new wins in high temperature engine components together with increases in F-35 hardware deliveries in accordance with the transition of this key programme into initial production.

CHI supported a healthy balance of existing and new military and commercial programmes in the year. Military programmes serviced by CHI include the F-35, F-16, C-17 and F-18. Commercial programmes are weighted towards the B777, B787, and A350.

During the period CHI was involved in the design, development and fabrication of a key high temperature component for one of the newest unmanned aircraft system ("UAS") platforms, which leaves the business well positioned to capitalise on this programme when it transitions into initial production next year. In addition, CHI began work, and delivered their first engine components to the B787 and A350 programmes.

CHI has played, and continues to play, a critical production role in the Group's largest ever tooling contract. In support of this activity, over 25,000 lbs of carbon BMI material was processed by CHI in the fourth quarter of the year. Installation of the necessary clean room and infrastructure to support this programme was completed on time and within budget. Fabrication of the final assemblies was started in the final month of the year with deliveries on schedule for the first quarter of 2011/12.

The year ended with another strong backlog and attractive pipeline of bid opportunities. As in prior years, with its niche high temperature expertise CHI has continued to see a rise in both the value and breadth of individual opportunities underlining confidence in future growth opportunities from both existing and new customers and product applications. Recent strengthening of CHI's sales and marketing team, with a particular focus on both existing core customers as well as developing international opportunities, has been a key ingredient in this success.

In line with the Group's new focus on lean manufacturing and continuous improvement, activities at CHI in 2010/11 included the introduction of a continuous moving line for one high rate production programme, standard work and pacing for the largest contract, and value stream mapping on the majority of all existing programmes. CHI's facility expansion, which was initiated in the previous year, was successfully completed in 2010/11, with full utilisation of the new large autoclave, oven and clean room expansion.

With approximately 80% of its revenue derived from legacy U.S. military programmes, Dallas, Texas-based Texstars, Inc. saw a decline in revenue in 2010/11 as the result of a reduction in orders on defence transparency programmes and the impact of lower U.S. defence spending generally, particularly in the second half. Notable declines were seen in the volume of transparent anti-ballistic armour sales, where end market applications are armoured fighting vehicles.

Sales of F-16 canopies also saw a year-on-year decline, although levels are expected to slowly recover in 2011/12 as military inventory levels drop with on-going USAF and foreign military mission requirements.

The full impact of lower volumes was mitigated by restructuring actions undertaken in 2010/11 to reduce Texstars's fixed cost base, with further efficiencies contributed by continuous improvement initiatives. These included value stream improvements in the F-16 canopy production cells, 5S activities and various other initiatives to reduce cost, improve quality and reduce working capital.

As with CHI, a strong focus has continued to be placed on technology development at Texstars in 2010/11, centered mainly on developing transparency coating advancements for 5th generation fighter aircraft.

Management emphasis continues on broadening Texstars's revenue base away from its traditional customer and product applications to reduce reliance on repeat business and less predictable aftermarket demand. In this regard, marketing activity in the year resulted in new programme wins with several notable large orders which are expected to generate annualised revenue of over USD 5 million. These included contracts to manufacture and assemble the composite empennage together with various other composite structures for a US naval aircraft programme, and lightweight composite passenger seat shells that will equip the cabins of numerous B747 and A380 aircraft.

Additionally, rising demand for composite panels resulting from new infrastructure investment in the mass transit market in several large metropolitan areas is expected to benefit Texstars in 2011/12, with several large opportunities presently at an advanced stage in the bid pipeline. Texstars is well positioned to support this with its proven proprietary VARTM (vacuum assisted resin transfer molding) processes to build high quality, light weight interior panels and liners. One such contract was won in May 2011.

In total, new business awards in 2010/11 are expected to generate over one third of Texstars's revenue in 2011/12 and provide a robust revenue base to drive further growth in the future. Opportunities associated with dual sourcing strategies on the F-35 programme also remain available for Texstars in the longer term.

Aerospace Components & Structures

Hampson's Aerospace Components & Structures businesses supply small, specialist products and highly engineered, performance-critical metallic components, sub-assemblies and fully assembled structures to many of the world's leading airframe manufacturers, prime contractors and tier one suppliers.

The division operates from six facilities across the UK, North America and India and employs over 400 people in the production of a broad range of largely metallic components for commercial and military airframe structural applications. Products manufactured range from small solid and laminated shim components to large, stretch-formed aluminium components and highly engineered sub-assemblies for aircraft wing, nacelle, fuselage, empennage, door and nose-cone structures.

Total revenue for the year ended 31 March 2011 reduced by £7.5 million (16%) reflecting the effect of the mid-year disposal in 2009/10 of the Group's UK-based gas turbine engine component manufacturing business. Excluding the impact of this disposal, underlying revenue increased by £1.9 million (5%) over the year. Trading profit for the year ended 31 March 2011 increased by £0.9 million (26%) to £4.4 million reflecting strong performances by Lamsco, Attewell, Bolsan and PSG. Excluding the mid-year disposal in 2009/10, trading profit increased by £1.4 million (48%).

Following a steep decline in revenue in 2009/10, BHW, the Group's UK-based aero structures facility, saw greater stability in the year ended 31 March 2011. Revenue did, however, fall short of the level anticipated due to delays in the HondaJet programme, which has now entered its flight test programme.

Hampson is the contracted sole source for the manufacture and supply of the empennage structural sub assembly for Honda's inaugural aerospace programme. All pre-production units were delivered to schedule, in September 2010. The first production units are now scheduled for delivery in September 2011, however the ramp up in build schedule is now expected to be slower than anticipated over the next two years. Despite this, BHW is well positioned on this exciting new aircraft programme and has recently secured nomination for a further contract.

BHW also secured a significant package of follow-on work from BAE Systems for the in-service support of a pan-European military aerospace programme. The first modification kit will be delivered to support this programme, which is unaffected by recent UK defence reviews, in June 2011, with the balance supplied over a two year period.

Whilst BHW remained loss making in 2010/11, operational performance improved with the benefit of prior year restructuring, a major new systems investment and a number of further cost reduction actions which were phased across the year.

The implementation of SAP, which went live in April 2010, has been a key enabler in streamlining and re-engineering business processes to improve efficiency and drive out waste. Benefits have been seen on a progressive basis over the second half, particularly in improved schedule adherence, and reduced manufacturing cycle times, leading to a reduction in inventory levels. In parallel, a number of projects were concluded under the lean deployment programme and by August 2011, all employees will have been engaged in training and subsequent improvement projects.

BHW also initiated a project to gain NADCAP approval for the balance of its key manufacturing processes, and accreditation for welding and brazing was awarded in February 2011. Remaining accreditations, covering heat treatment and chemical etching processes are scheduled to be obtained in 2011/12. This important project ensures that all operating procedures at BHW are as a minimum accredited to this recognised international standard and again reflects the continuous improvement culture nurtured within the business.

Lamsco, Attewell, Bolsan and PSG each delivered further strong performances in 2010/11, delivering growth in revenue and trading profit compared with 2009/10 as customer demand increased.

Lamsco again achieved a major supplier award from Boeing for the maintenance of consistent high levels of quality and delivery, averaging over 99%. New work was gained on the B787 programme, with growth in demand in particular for shim components produced in exotic, light weight materials.

Attewell also continued to support growing demand from Boeing's tier one suppliers to the B787 programme, in addition to strong demand from European-based prime and sub-contractors to the F-35 and Typhoon military programmes. In light of anticipated further growth requirements, Attewell will be relocating to a new facility in the summer of 2011 which will enable an approximate doubling of manufacturing capacity.

PSG successfully opened a new facility in the Czech Republic during the year to provide direct line feed supply to a new production location of its major customer. The new facility is now operational and is fully integrated into PSG's core systems.

In what has been a record year, PSG also saw expansion of its UK customer base, bringing with it new product lines and diversification of end markets supplied. In addition to its main activity as an international supply chain service supplier, PSG is also undertaking low level sub-assembly work as an additional service line to its customers, and this activity is expected to grow progressively in the future.

Hampson's green field, Bangalore, India-based operation made great strides during the year, gaining further orders for closely-toleranced, high volume precision engineered components. A developing reputation for delivering high quality, dependable products at a competitive cost has been a key ingredient behind these latest wins. As these new contracts move into full production, the site is expected to be profitable in 2011/12.

Longer term plans are now being finalised for Hampson's Indian manufacturing facility to move into aerospace. This will leverage the Group's existing expertise, whilst adding an integrated, low cost manufacturing component to deliver competitive advantage to the Group's global aerospace customer base.

Automotive Turbocharger

During the year the Group disposed of its Automotive Turbocharger business. This transaction marked a strategically important step for the Group in that it is now entirely focused on aerospace, and more specifically the application of composite technologies within our global leadership positions. The transaction was subsequently subject to litigation and although we are disappointed with the way this reflected on the Group and with the outcome of the litigation, we are pleased it has now been resolved.

Group Performance

Revenue - £197.5 million (2009/10: £169.1 million)

At £197.5 million, revenue from continuing operations of the Group for the year ended 31 March 2011 increased by £28.4 million (17%) compared with the prior year. Excluding the impact of the mid year disposal of Hampson Aerospace Machining Limited "HAML" in the prior year, revenue increased by £37.8 million (24%). On a constant currency basis and excluding the disposal of HAML in the prior year, the increase in revenue from continuing operations was £34.4 million (21%).

In Aerospace Composites & Transparencies, revenue increased by £35.9 million (30%) during the year ended 31 March 2011. This was driven largely by activity under the Group's largest ever tooling contract, which was awarded in September 2010 with a value at inception of USD53 million, together with increasing activity on the F-35 programme covering both tooling and high temperature composite engine components.

Revenue in Aerospace Components & Structures fell in headline terms by £7.5 million (16%) during the year ended 31 March 2011, due to the inclusion of four and half months of trading from HAML (which was divested in August 2009) in the prior year comparative. Adjusting for this on a pro forma basis, underlying revenue increased by £1.9 million (5%) over the year. Further growth was held back by a delay in receipt of anticipated orders for a military aircraft upgrade programme which impacted the Group's UK aero structures business.

Trading Profit* - £17.5 million (2009/10: £32.5 million)

Trading profit from continuing operations for the year ended 31 March 2011 declined by £15.0 million (46%) to £17.5m. Excluding the impact of HAML in the prior year, trading profit declined by £14.4 million.

The results of subsidiary undertakings denominated in US dollars have been translated into sterling at an average rate of GBP1 = 1.56 for the year ended 31 March 2011, compared with a rate of GBP1 = 1.60 in 2009/10. In constant currency terms and excluding the impact of HAML, the decline in trading profit would have been marginally higher, at £14.8 million, a reduction of 46% compared with 2009/10.

Group results in 2010/11 were adversely impacted by performance at one of the Group's US tooling operations. A number of operational and financial improvement initiatives have now been introduced at the business, including the implementation of SAP, strengthening of a number of key management positions, enhanced processes and lean initiatives, all of which are expected to contribute to improved results going forward.

\* Trading Profit is defined as Operating Profit before restructuring and rationalisation charges, impairment charges, gains and losses on disposal or closure of businesses, changes in the net fair value of financial instruments and amortisation of intangible assets on acquisition. The Directors believe that exclusion of these items allows trends in the performance of the Group's continuing business to be more easily identified and understood.

Restructuring and rationalisation charges - £(1.2) million (2009/10: £(3.7) million)

Restructuring and rationalisation charges of £1.2 million were incurred during the year, of which the principal element was in respect of termination costs of a number of senior employees, and recruitment costs of the current Group Chief Executive. Cash costs of approximately £0.3 million will be paid out during the year ended 31 March 2012 to individuals whose employment was terminated in 2010/11.

Restructuring and rationalisation charges: Net financing costs - £(1.7) million (2009/10: £(3.3) million)

£1.7 million of exceptional debt servicing costs were paid during the year ended 31 March 2011 in relation to amendments to existing senior bank and loan note facilities completed.

Impairment charges - £(38.7) million (2009/10: £(2.9) million)

During the year ended 31 March 2011, the Group recognised total asset impairment charges of £38.7 million in relation to goodwill within the Aerospace Composites & Transparencies segment and inventory at certain North American sites.

Following a detailed assessment of the carrying value of goodwill and changes in key assumptions including a higher pre-tax discount rate, the estimated recoverable amount of goodwill was lower than its carrying value, and thus an impairment of £34.6 million has been charged to the Income Statement.

Impairment in relation to inventory related primarily to loss-making contracts and onerous contracts where costs to complete exceeded revenues earned.

Profits and losses on sale or closure of businesses - £nil (2009/10: £6.1 million)

During the year ended 31 March 2010 a net gain arose on the disposal of HAML of £6.1 million after transaction-related expenses.

Amortisation of intangible assets on acquisition - £(0.9) million (2009/10: £(3.0) million)

Amortisation of £0.9 million was charged in 2010/11 to reduce the carrying values of certain separable intangible assets recognised in respect of acquisitions on a systematic basis over their remaining estimated economic lives.

Changes in the net fair value of financial instruments - £0.7 million (2009/10: £4.8 million)

The Group enters into forward foreign exchange contracts, interest rate swaps and other derivative financial instruments to hedge its transactional and strategic exposures to interest rate and foreign exchange fluctuations. The Group has not applied hedge accounting for these instruments in the year ended 31 March 2011 and hence movements in the net fair values between balance sheet dates are dealt with within the Income Statement. The net credit in the year has arisen from changes in market interest and currency exchange rates.

Operating (loss)/profit - £(23.3) million (2009/10: £33.3 million)

Operating loss for the year ended 31 March 2011 was £23.3 million, a decrease of £56.6 million compared with the previous year. The principal underlying movements were a decrease in trading profit of £15.0 million, decrease in restructuring and rationalisation charges of £2.5 million, increase in impairment charges of £35.9 million, decrease in gains and losses on disposal or closure of businesses of £6.1 million, adverse movement in relation to the net fair value of non-interest financial instruments of £4.3 million and a decrease in the charge for amortisation of intangible assets on acquisition of £2.2 million.

Other net financing costs - £(6.8) million (2009/10: £(7.3) million)

Excluding charges in relation to the net fair value of fixed-income financial instruments and the expensing of costs in relation to amended borrowing facilities, other net interest payable decreased by £0.5 million due primarily to higher levels of bank interest received and expected return on pension scheme assets, combined with lower levels of interest payable on financial instruments.

(Loss)/profit before taxation - £(31.1) million (2009/10: £23.3 million)

Profit before tax in a management adjusted basis decreased by £14.4 million (57%) for the year ended 31 March 2011 due to the factors outlined above. Statutory profit before tax decreased by £54.4 million (234%) in the same period.

Taxation - £17.7 million credit (2009/10: £6.1 million charge)

The total tax credit for the year of £17.7 million represented an effective rate of 57% on loss before tax (2009/10: 26% on profit before tax). For the year ended 31 March 2011, the effective tax rate benefited from credits of £2.4 million in relation to excess provisions released in prior years. Deductions which will be available to offset against future taxation liabilities of the Group's US subsidiaries over a fifteen year period amounting to approximately USD115.7 million, resulting from a tax election made in respect of acquisitions completed during the year ended 31 March 2009, have not been recognised as an asset in these financial statements in line with current accounting standards. They therefore continue to remain a source of unrecognised significant future economic benefits.

Discontinued operations

During the period the Group disposed of Hampson Precision Automotive Limited generating a post tax loss on disposal of £9.2 million. As part of legal action taken by the acquirers over the sale the Group incurred £0.5 million of legal costs and has provided £2.8 million for an out of court settlement and additional legal costs of the Group.

Earnings per share

Basic earnings per share from continuing operations on a statutory basis were (4.83p) (2009/10: 9.98p). Basic earnings per share from continuing operations on a management adjusted basis were 5.99p compared to 10.80p in the prior year.

Dividend

In light of the continuing strategic priority to reduce the Group's current indebtedness level, the Board does not propose to declare a dividend in respect of the year ended 31 March 2011.

Cash flow

As a result of lower profitability and higher levels of investment in working capital on the Group's largest ever tooling contract during the period, cash flow from operations decreased by £19.3 million compared to the prior year to £5.3 million. With high levels of capital investment over recent years and facility expansions, as expected, capital investment in the year reduced to £6.6 million.

Net borrowings

Net borrowings of the Group increased by £10.6 million, to £92.9 million as at 31 March 2011. The ratio of net borrowings to shareholders' equity increased 11 percentage points to 40%. The ratio of net borrowings to EBITDA on a lender-measurement basis was 3.95 times as at 31 March 2011, compared to a covenanted ratio of 4.57 times.

Pensions and post employment obligations

The Group continues to carefully and prudently manage its exposure to liabilities arising under defined benefit arrangements. The single defined benefit pension scheme now in existence has been closed to further accrual since before May 2000 and represents a consolidation of a number of separate previous schemes with effect from 1 April 2007. The aggregate gross deficit reduced to £0.8 million as the result of an increase in the fair value of the scheme's assets. There was no material underlying movement during the year in the actuarially-assessed obligation under the Group's single US post retirement healthcare scheme and combined with exchange rate differences resulted in the deficit remaining at £0.4 million on translation into sterling and before taking account of deferred tax.

Shareholders' equity

Equity attributable to shareholders of the parent company decreased overall by £50.0 million during the year, standing at £233.3 million at 31 March 2011. The main elements of the movement during the year were additional share capital in relation to scrip dividend payments of £0.4 million, the loss for the financial year of £27.4 million, payment of the 2009/10 final dividend of £2.5 million, share based payment transactions of £0.9 million and unfavourable foreign exchange differences on retranslation of the Group's US dollar denominated net assets, of £21.4 million.

Consolidated Income Statement

For the year ended 31 March

* Adjustments relate to restructuring and rationalisation charges, impairment charges, gains and losses arising from the disposal or closure of businesses that do not meet the criteria to be classified as discontinued operations under IFRS 5, changes in net fair value of derivative financial instruments required under IAS 39 and amortisation of intangible assets on acquisition required under IFRS 3.

Consolidated Income Statement

For the year ended 31 March

* Adjustments relate to restructuring and rationalisation charges, impairment charges, gains and losses arising from the disposal or closure of businesses that do not meet the criteria to be classified as discontinued operations under IFRS 5, changes in net fair value of derivative financial instruments required under IAS 39 and amortisation of intangible assets on acquisition required under IFRS 3.

** Re-presented following the sale of Hampson Precision Automotive Limited, see note 1.

Consolidated Statement of Comprehensive Income

For the years ended 31 March

Consolidated Balance Sheet

As at 31 March

The financial statements were approved by the Board of Directors on 30 June 2011 and were signed on its behalf by:

C V Geoghegan

Chairman

N D Jordan

Chief Executive

Consolidated Statement of Changes in Equity

The share based payment reserve results from the best available estimate of the number of equity-settled share based incentive arrangements expected to vest, as per IFRS 2 'Share-based payments'.

The exchange reserve represents the accumulated net currency variations on overseas net assets.

Retained earnings include the accumulated profits and losses arising from the consolidated Income Statement and certain items from the Statement of Comprehensive Income attributable to equity Shareholders, less distributions to Shareholders.

Consolidated Cash Flow Statement

For the years ended 31 March

Cash flows from operating activities

For the years ended 31 March

Reconciliation of cash and cash equivalents and net debt

For the years ended 31 March

Cash and cash equivalents comprise of cash on hand, demand deposits and overdrafts. Unless an enforceable right of set-off exists, the components of cash and cash equivalents are reflected on a gross basis in the balance sheet.

Net debt is defined as the Group's borrowings (net of unamortised issuance costs) and finance leases, less cash and cash equivalents.

Reconciliation of movement in cash and cash equivalents to movement in net debt

For the years ended 31 March

Other movements in net debt represent movements in the unamortised issuance costs in relation to borrowings within the Group.

NOTES TO THE FINANCIAL STATEMENTS

1. Basis of preparation

The financial information set out in this announcement, which was approved by the Board on 30 June 2011, does not constitute the Company's statutory accounts for the years to 31 March 2011 and 31 March 2010 but is derived from the 2011 statutory accounts. The statutory accounts for the year to 31 March 2010 have been reported on by the Company's auditors and delivered to the Registrar of Companies. The statutory accounts for the year to 31 March 2011 will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The auditors have reported on the statutory accounts for the years to 31 March 2011 and 31 March 2010, their reports were unqualified, did not include references to any matter which the auditors drew attention to by way of emphasis without qualifying their report and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

Due to the disposal of Hampson Precision Automotive Limited during the period and exiting the automotive turbocharger market, in accordance with IFRS 5, its results have been classified as a discontinued operation and the comparative periods have been amended accordingly.

2. Segmental analysis

Segment information for revenue and profit:

Segment information for assets:

Segment information by geographical region:

Segment revenue is disclosed by geographical location of the Group's customers. Segment assets are disclosed by geographical location of the Group's assets.

3. Operating (loss)/profit

Reconciliation of revenue to total operating (loss)/profit:

All revenue in both the current and prior year relates to the sale of goods.

Operating (loss)/profit is stated after charging/(crediting):

Trading profit for the year ended 31 March 2011 include a net benefit of £1,317,000 arising from settlement of legal claims less legal costs paid in the year.

Trading profit for the year ended 31 March 2010 includes £11,635,000 arising from the release of excess accruals and £6,619,000 arising from non-recurring trading costs, resulting in a net benefit to trading and operating profit in the year of £5,016,000. The non-recurring costs relate to temporary excess and unproductive labour costs, which, following subsequent restructuring action to realign pay rates, working practices and employee numbers will not recur.

Trading profit for the year ended 31 March 2010 includes a credit of £3,172,000 arising from termination of foreign exchange contracts and a debit of £1,330,000 arising from loss making foreign exchange contracts.

4. Adjustments

Restructuring and rationalisation charges

Charges of £1,216,000 (2010: £3,712,000) included within operating (loss)/profit relate primarily to costs of employment termination, legal services and onerous leases.

Charges of £1,714,000 (2010: £3,253,000) included within net financing costs relate to fees paid to the Group's senior lenders and legal costs in relation to amendments to certain borrowing covenants.

Impairment charges

During the year the Group undertook a review of the utilisation and carrying values of certain assets. As a result of this £38,726,000 (2010: £2,854,000) of impairment charges were incurred, as follows:

a) Impairment charges in 2010/11

As part of the year end assessment of the carrying value of goodwill, an impairment charge of £34,617,000 was recognised in relation to the Aerospace Composites & Transparencies segment.

Following a detailed review of inventory during the year at certain North American sites, the Group recognised impairment charges of £4,109,000 primarily in relation to loss-making contracts and onerous contracts where costs to complete would exceed revenues earned.

b) Impairment charges in 2009/10

Due to reductions in customer order levels during the year, certain subsidiaries of the Group recognised impairment charges against the carrying values of certain inventory items. As a result impairment charges of £2,114,000 were incurred.

During the year a subsidiary of the Group negotiated a commercial settlement with a customer to liquidate a number of significantly overdue receivables. As part of this settlement impairment charges of £740,000 were incurred.

Gains and losses on disposal or closure of businesses

During the year ended 31 March 2011 gains of £nil (2010: gain £6,147,000) were made in relation to the disposal of Hampson Aerospace Machining Limited.

Changes in net fair value of derivative financial instruments

IAS 39 requires derivative financial instruments to be valued at the Balance Sheet date and any difference between that value and the intrinsic value of the instrument to be reflected in the Balance Sheet as an asset or liability. Any subsequent change in value is reflected in the Income Statement unless hedge accounting is achieved. Such movements do not affect cash flow or the economic substance of the underlying transaction, and thus to aid in year-on-year comparability, the change in value has been identified separately. As a result the changes in net fair value of derivative financial instruments were:

Amortisation of intangible assets on acquisition

As required under IFRS 3 'Business Combinations' and IAS 38 'Intangible Assets', intangible assets identified on acquisition have been amortised during the year - £888,000 (2010: £3,038,000).

The above adjustments are included within cost of sales £5,097,000 debit (2010: £9,356,000 debit) and administrative expenses £35,735,000 debit (2010: £10,181,000 credit).

The net cash outflow from the above adjustments during the year amounted to £867,000 (2010: inflow £23,677,000).

5. Net financing costs

During the year the Group capitalised borrowing costs of £49,000 (2010: £nil) on qualifying asset expenditure. The average capitalisation rate for the year ended 31 March 2011 on general borrowings was 5.3%. There is no associated tax relief in relation to these capitalised borrowing costs.

6. Taxation

The Budget on 23 March 2011 announced that the UK corporation tax rate will reduce from 28% to 23% over a period of 4 years from 2011. The first reduction in the UK corporation tax rate from 28% to 26% was substantively enacted on 29 March 2011 and will be effective from 1 April 2011. As such, the deferred tax balances outstanding at the Balance Sheet date are stated at 26%. It has not yet been possible to quantify the full anticipated effect of the announced further 3% rate reduction, although this will further reduce the Group's future UK current tax charge and reduce the Group's UK deferred tax liabilities accordingly.

The standard rate of tax for the year, based on the United Kingdom standard rate of corporation tax, is 28% (2010: 28%). The actual effective tax (credit)/charge for the year ended 31 March 2011 was higher (2010: lower) than the standard rate. The principal reconciling items are illustrated below:

7. Discontinued operations

Discharge of liabilities associated with previously discontinued operations

Costs in order to discharge liabilities in relation to companies previously classified as discontinued operations relate to legal and property costs. During the year ended 31 March 2010 costs related to dilapidation rectification and professional fees for a property that had been vacated by the Group in 1991 as part of a disposal of a subsidiary.

Disposal of Hampson Precision Automotive Limited

On 23 June 2010 the Group disposed of its entire 100% shareholding in Hampson Precision Automotive Limited to a company backed by the directors of GIL Investments Limited. Due to the Group exiting the automotive turbocharger market, in accordance with IFRS 5 its results have been classified as a discontinued operation.

The results of Hampson Precision Automotive Limited, that are included within discontinued operations, were as follows:

The net cash flows in relation to Hampson Precision Automotive Limited were £176,000 outflow from operating activities (2010: £980,000 outflow), £4,000 outflow from investing activities (2010: £2,277,000 outflow) and £116,000 outflow from financing activities (2010: £214,000 outflow).

The Group's loss on disposal of Hampson Precision Automotive Limited was as follows:

Directly attributable costs relate to legal and other professional costs associated with the disposal.

As part of the disposal of Hampson Precision Automotive Limited, Hampson Industries PLC disposed of the freehold interest in the properties in Skelmersdale, UK occupied by the business to a company backed by the directors of GIL Investment Limited. The carrying value of the properties as at the date of disposal was £1,409,000. The properties were sold for £1,100,000, creating a loss on disposal of £309,000, which is included within the above disposal calculation.

An analysis of the net inflow of cash in respect of disposals is as follows:

Costs associated with litigation and settlement relating to discontinued operations

Following the disposal of Hampson Precision Automotive Limited on 23 June 2010, legal proceedings were commenced by Erlson Precision Holdings Limited ("Erlson") regarding alleged misrepresentations made about a significant customer as part of the sale process. On 20 April 2011 the High Court found in favour of Erlson, and held that the contract should be rescinded and a percentage of Erlson's legal costs paid. The Group appealed the decision, however on 3 June 2011 the parties agreed that the Group would pay £1,500,000 by way of compensation plus a contribution towards legal fees.

During the year ended 31 March 2011 the Group incurred £459,000 of legal costs in relation to litigation. The Group has provided £2,800,000 in its financial statements for the year ended 31 March 2011 in relation to the settlement of this liability and additional legal costs incurred by the Group.

8. Dividends

The Directors propose that no final dividend in respect of the financial year ended 31 March 2011 be paid.

9. Earnings per share

Basic Earnings per Share

Basic earnings per share is calculated by dividing the profit attributable to equity shareholders by the weighted average number of ordinary shares in issue during the year.

Diluted Earnings per Share

Diluted earnings per share is calculated by dividing the profit attributable to equity shareholders by the weighted average number of ordinary shares in issue during the year, adjusted for any dilutive potential ordinary shares, primarily share options. For share options issued under the Executive Share Options Schemes, the calculation is performed by determining the number of shares that could have been acquired at fair value and compared with the number of shares that would have been issued assuming the exercise of the share options. For share options issued under the Performance Share Plans and Co-Investment Plans, the calculation is performed by assessing what percentage of the terms and conditions of vesting had been achieved as at the balance sheet date to determine the number of shares that could have been issued.

Adjusted Earnings per Share

Earnings per share based on continuing activities before restructuring and rationalisation charges, impairment charges, gains and losses on the sale or closure of businesses, changes in the net fair value of financial instruments and amortisation of intangible assets on acquisition, which the Directors consider allows trends in the performance of the Group to be more easily identified and understood, is calculated on the earnings of the year adjusted as follows:

10. Other information

The Group's financial statements for the year ended 31 March 2011 will be sent to shareholders during the week commencing 25 July 2011.

The Annual General Meeting will be held on 8 September 2011.

Group Headquarters and Registered Office: Registrars & Transfer Office:

7 Harbour Buildings, Waterfront West Equiniti, Aspect House, Spencer Road

Dudley Road, Brierley Hill, Lancing, West Sussex, BN99 6DA

West Midlands, DY5 1LN

Tel: +44 (0) 1384 485345 Tel: +44 (0)871 384 2030

Fax:+44 (0) 1384 472962

Website: www.hampsongroup.com