APC Technology Regulatory News (APC)

Advanced Power Components plc

Unaudited Interim Results for the six months ended 28 February 2011

Advanced Power Components (AIM: APC) ("APC" or the "Company" or the "Group"), the UK specialist distributor and manufacturers' representative of electronic components, is pleased to announce its interim results for the six months ended 28 February 2011.

Highlights

§ Profit before tax increased 138% to £100,000 (H1 2010: £42,000)

§ Revenues for the period of £6.52 million (H1 2010: £6.47 million)

§ Basic and diluted earnings per share of 0.3p (H1 2010: 0.1p)

§ Improved financial position and reduction in Net Debt to £1.7 million (H1 2010: £2.4 million)

§ Continued progress within the green technology sector

Commenting on the results, Mark Robinson, APC's Chief Executive, said:

"This has been a positive period for APC with increased order intake and improved profitability, primarily as a result of steps taken to engage with customers earlier in the design process. In addition to the healthy performance of our core components distribution business, we are also experiencing pleasing progress as we look to take advantage of the growing demand for energy-saving products. All this leads us to look to the future with increasing optimism."

Enquiries:

Notes to Editors:

About Advanced Power Components

APC plc is a leading specialist distributor of electronic components, comprising eight areas of activity:

¡ APC Hi-Rel distributes a variety of specialist electronic components into applications where component reliability is of paramount importance. Hi-Rel's franchised product lines include power semiconductors, power supplies, memory, wound and high voltage components.

¡ APC Locator is the number one solutions provider for obsolete and hard-to-find parts, with 25 years' experience in the industrial and defence/aerospace markets across Europe.

¡ APC Hero has a specialist technical sales team focussing on sensors and measurement, power management, communications & connectivity and embedded computing applications.

¡ APC Go! provides a kitting and materials management service to companies wanting to outsource non core activities, offering services ranging from material procurement to full production management.

¡ APC Displays+ provides dedicated technical and commercial support for a wide range of displays, driver boards, ICs, single board computers and all related connectivity.

¡ APC Novacom is a distributor and manufacturers' representative for RF and microwave frequency electronic components. The business is managed by a team of technical specialists with many years experience in the RF and Microwave industry.

¡ APC Contech is a distributor of specialist data input devices for industrial, broadcasting and medical sectors providing technically advanced solutions for specific application areas.

¡ APC minimise is a manufacturer and distributor of power saving equipment which optimises the performance of electrical motors, leading to reduced energy consumption and cost savings.

The six-month period ended 28 February 2011 was very positive for APC with clear signs that the level of new order intake is returning to that experienced prior to the economic downturn of the past couple of years. As a result, profitability continued to improve within the core specialist electronic component distribution business where steps taken over the past two years to engage with customers earlier in their design cycle have led to a significantly strengthened order book. In addition, the decision taken to diversify into the emerging green technology sector is looking increasingly important to the future of the Company. Sales of the imop™ energy-saving product range are beginning to grow and, significantly, through this venture APC is becoming exposed to an increasing number of global opportunities.

Sales revenues in the period of £6,519,000 were marginally higher than in the corresponding period in the prior year (£6,471,000) and gross margins were slightly lower at 29.0% compared to 30.1% in the first half of 2010. However, because of more closely controlled operational costs, net profit before tax increased 138% to £100,000. Significantly, the gross margin of 29.0% represented a noteworthy improvement over the second half of 2010 (27.2%). This was the result of the aforementioned focus on securing more profitable long term design wins at the expense of short term spot business.

The Company's financial position has continued to improve. The average level of net debt during the period was substantially lower than in the first and second halves of 2010. The lower average net debt, lower average interest rate mix and improved day to day treasury management all contributed to a reduction in finance costs to £66,000 from £96,000 in the first half of 2010.

The improving business performance and financial position have been achieved at the same time as the Company investing in recruiting a number of technical sales people. This initiative is expected to achieve closer relationships with both strategic customers and suppliers, something considered critical to the long term success of the core business.

A significant amount of progress has been made to position the Company to take advantage of the rapidly growing global market for green technology products. Distributors for the imop™ have been established in Europe and the Far East while negotiations continue in other territories, including the Middle East. Meanwhile, the Company is engaged in the process of selecting other energy related technologies to be marketed through its emerging sales and marketing channels as part of the strategy to broaden its product portfolio and increase the number of overseas distributors over a wider geographical area.

Progress achieved within the business and recent developments in both core and new target market sectors are resulting in a stronger outlook for the Company. Coupled with a strong ongoing performance in the current financial year, this enables the Board to look to the future with increasing optimism.

Will David

Chairman

9 May 2011

There are no elements of Comprehensive Income other than those included in profit for the period.

1. General information

Advanced Power Components plc is a public limited Company ("the Company / the Group") incorporated in the United Kingdom under the Companies Act 1985 (registration number 01635609). The Company is domiciled in the United Kingdom and its registered address is 47 Riverside, Medway City Estate, Rochester, Kent, ME2 4DP. The Company's Ordinary Shares are traded on The AIM Market of the London Stock Exchange. The Group's principal activities are the supply and distribution of electronic components.

2. Basis of preparation

This unaudited consolidated interim financial information has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively EU IFRSs). The principal accounting policies used in preparing the interim results are those it expects to apply in its financial statements for the year ended 31 August 2011 and are unchanged from those disclosed in the Group's Annual Report for the year ended 31 August 2010.

The financial information for the six months ended 28 February 2011 and 28 February 2010 is unreviewed and unaudited and does not constitute the Group's statutory financial statements for those periods. The comparative financial information for the full year ended 31 August 2010 has, however, been derived from the audited statutory financial statements for that period. A copy of those statutory financial statements has been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498(2)-(3) of the Companies Act 2006.

Restatement of February 2010 unaudited interim results

The comparative financial statements for the year ended 31 August 2009 were restated in the annual report for the year ended 31 August 2010 to correct an over valuation of inventory as at 31 August 2009 of £261,000 and consequent over statement of retained earnings. The comparative condensed consolidated statement of financial position and condensed consolidated statement of changes in equity have been restated as at 28 February 2010 to reflect the restatement of inventory and retained earnings as at 31 August 2009. The comparative condensed consolidated statement of comprehensive income for the period to 28 February 2010 was unaffected by the restatement. The deferred tax asset as at 28 February 2010 has been restated to reflect the increased tax loss carried forward as at 31 August 2009.

The financial information in the Interim Report is presented in Sterling and all values are rounded to the nearest thousand pounds (£000) except when otherwise indicated.

3. Segmental information

The majority of the Group's activity arises in the United Kingdom from the Group's principal activity. The directors manage and monitor all operations of the business on a unified basis and consider that all of the Group's operations are in similar markets and face similar risks. Consequently, the directors consider the Group has one business and one business segment.

4. Earnings per share

The calculation of basic earnings per share is based on the profit after taxation for the period and the weighted average number of shares in issue during the period.

Diluted earnings per share is calculated by adjusting the weighted average number of shares outstanding by the dilutive effect of ordinary shares that the Company may potentially issue relating to its convertible loan notes and its share option scheme. The profit for the six months is adjusted to add back the tax interest cost on the liability component of the convertible loan notes. Where the effect of the above adjustments is anti-dilutive they are excluded from the calculation of diluted earnings per share.

The profit for the period and the weighted average number of shares used in the calculations are set out in the following table: -

There were 25,700,928 shares in issue at 28 February 2011.

5. Analysis of net funds

6. Copies of Interim report

The Interim report is available to view and download from the Company's website at www.apc-plc.co.uk. If shareholders would like a hardcopy of the interim report they should contact the Company Secretary, Mr. David Brown.