Post Close Trading Statement

3 October 2012

Findel plc (the "Group")

Post-close Trading Statement

Findel plc, the UK Home Shopping, Educational and Healthcare business, today releases a trading update having entered the closed period ahead of its interim results announcement for the 26 weeks ended 28 September 2012. The interim results announcement is scheduled for 27 November 2012.

Group Performance

The Group has made good progress in the first half of the year with the encouraging trading performance over the first 16 weeks of the financial year, as previously announced, continuing. Group sales during the first half are 7.9% ahead of the prior year leading to a first-half operating profit.

The largest business in our Group, Express Gifts, has continued to deliver a strong sales performance. Ongoing improvements in value and product range have led to first half sales being 18.0% ahead of the prior year with bad debt rates remaining stable. The investment in keener pricing and promotions has resulted in a reduction in gross margin percentage but an increase in cash gross profit. As we move into the peak Christmas period, Express Gifts is well positioned for further growth, although the rate of growth may slow as comparative periods are stronger.

For Kleeneze, the continuing wet summer conditions have contributed to poorer than anticipated performance. In the first half, an increase in distributor attrition, particularly from newer recruits, has led to an overall net decline in distributor numbers over the period and first-half sales are 7.1% lower than prior year. Work is underway to address these performance issues.

Kitbag continues to demonstrate a much stronger performance as a result of the ongoing management actions previously announced. Sales have accelerated over the last 10 weeks of the first half, and for the first half as a whole are 11.1% ahead of the prior year, with a significant increase in gross margin.

The turnaround in our Education Supplies business continues to be encouraging. In the first half, our UK schools-focused brands have achieved strong growth, and our UK classroom and specialist brands are also now trading ahead of prior year. This has led to overall UK brand growth in the first half. Sales for the half-year will be behind prior year by 5.2% almost entirely as a result of the planned shorter duration of the 2012 Sainsbury's "Active Kids" store scheme to accommodate Sainsbury's Paralympics sponsorship, and with lower international sales.

Our Healthcare business has continued to see growth versus the prior year, with sales ahead by 13.2% in the first half driven by a combination of net new contracts and growth from existing contracts. A number of significant new opportunities are coming to market and the business is well placed for bidding to win these.

The group continues to make good progress in improving its supply chain and restoring normal credit terms with suppliers which is having a beneficial effect on working capital. Notwithstanding the strong sales growth at Express Gifts leading to a resultant increase of over £9m in drawings under its securitisation facility, both the group's core bank debt and the overall net debt at the end of September have reduced compared to the prior year.

Outlook

The Group's trading performance during the first-half confirms that our turnaround actions are taking effect with an overall improvement in first-half operating performance over the prior year. Whilst the peak sales periods for the Group are still to come and on-going pressure on spending causes us to remain cautious, we believe we are well placed to continue to deliver on our turnaround plans.

Enquiries

Findel plc Roger Siddle / Tim Kowalski0161 303 3465

Tulchan Communications LLPStephen Malthouse / Susanna Voyle / Michelle Clarke020 7353 4200