Press Releases

Unaudited interim results for the six months to 31 January, 2007.

6th March 2007

Manganese Bronze Holdings PLC, the leading manufacturer of the distinctive London taxi, announces its unaudited interim results for the six months to 31 January 2007.

Highlights

• Successful launch of TX4 taxi in October.
• New, larger retail facilities opened in London in December.
• Joint venture with Geely Automobile Holdings Limited granted shareholder approval in January.
• UK taxi sales up 21.3% to 1,342 vehicles (2006: 1,106).
• Operating profit £1.0 million (2006: £1.2 million) including run-off cost of £0.7 million to sell final TXII taxis and one off head office costs of £0.5 million.
• Net funds at 31 January of £0.6 million (2006: £2.3 million net debt) after capital expenditure in the last 12 months of £8.4 million.

Tim Melville-Ross, Chairman of Manganese Bronze, said;

“We have had a first half of significant achievement, with the signing of our Chinese joint venture and the launch of the new TX4 taxi.  UK taxis sales increased by 21.3%, with the TX4 being very well received by the taxi trade. We expect continued demand for the TX4 to drive sales higher in the second half.

For further information:

The Group has made an excellent start to the year with the successful launch of our new vehicle, the TX4, on 18 October and the opening of our new dealership in Kings Cross, London, in December. In January, our shareholders approved our joint venture with Geely Automobile Holdings Limited, which will establish Shanghai LTI Automobile Company Limited to produce London taxis in Shanghai, as well as a limousine style variant of the London taxi and two large saloon cars.

Vehicle Sales

Total vehicle sales increased by 20.9% in the first half to 1,347 compared with 1,114 vehicles sold last year. The new TX4, featuring a Euro IV engine, a modified braking system to incorporate anti-lock braking, revised rear suspension, and external and internal facelift, has been very well received by the UK market. Since the launch of the TX4, growth has been even stronger, with UK sales in the second quarter of 747, an increase of 40% compared with 534 last year. Customers, the taxi trade press, and passengers alike have all commented favourably on the added refinements introduced on the TX4.

To meet increasing demand for our vehicle, we moved into new retail premises in Brewery Road, Kings Cross, London in December. These facilities are three times the size of our old facilities in Holloway Road, Islington and have brought us closer to London’s taxi drivers, whose needs we are now better placed to serve.

The final new TXII’s have now been sold, with discounts, at a total cost of £0.7 million.

Vehicle sales operating profit of £0.9 million is in line with the comparable period last year. This does, however, include the TXII run-off costs and higher depreciation charges, the latter due to TX4 development and tooling costs of almost £5.5 million, which will be written off over five years.

Vehicle Services

The vehicle services segment is comprised of a taxi financing division and a US taxi servicing and advertising business. Overall, this segment generated a profit of £0.1 million (2006: £0.2 million). The taxi finance business performed to plan, and in line with 2006, while the US business performed less well, with a loss of £0.4 million  (2006: £0.3 million). Recently, there have been signs that the advertising business is picking up and we are excited by the opportunities our Chinese joint venture will bring to the US market.

Shanghai LTI

In January, our shareholders approved the establishment of our Chinese joint venture, Shanghai LTI, which will produce London taxis, as well as a limousine and two large saloons, in Shanghai. The establishment of the joint venture has now received the approval of the Shanghai government. On 16 February Geely successfully placed 600 million new shares generating net proceeds of HK$609 million (£41.6 million) which will mainly be used to fund Geely’s capital contribution to Shanghai LTI. Geely’s Extraordinary General Meeting to approve the 48% equity transfer to Manganese Bronze is scheduled for early April. The Shanghai Government is expected to approve this transfer by June. Start of production for the London taxi is planned for mid 2008. The project is proceeding according to plan.

Finance

Net funds at 31 January, 2007 were £0.6 million (2006: £2.3 million net debt), despite high capital expenditure in the last twelve months of £8.4 million on TX4, Brewery Road and the London TXII rental fleet. Cash in bank at 31 January, 2007 was £8.8 million (2006: £6.8 million).

The Board has declared an increased interim dividend of 2.25p per share (2006: 2.0p). This will be paid on 23 March, 2007 to shareholders on the register on 2 March, 2007.

Current Trading and Prospects

We believe that continued demand for the TX4 will drive sales higher in the second half. We also expect that significant progress will be made in Shanghai in transferring our intellectual property to Geely, and in preparing the Shanghai facility for the start of production.

Tim Melville-Ross
Chairman

For further information see unaudited interim results (PDF format - 55Kb)

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