Character Regulatory News (CCT)

27 Nov 2007 14:33

Character Group PLC27 November 2007 Issued by Citigate Dewe Rogerson Ltd, BirminghamDate: Tuesday, 27 November 2007 IMMEDIATE RELEASE The Character Group plc Further update in relation to Bindeez products The Board of The Character Group plc ("Group" or "Company") wishes to provide afurther update to shareholders in relation to Bindeez branded products. On 9 November 2007, the Directors announced a voluntary recall of Bindeezproducts and that they anticipated new and replacement supplies of Bindeez beadswhich conform to the correct specification would commence to be shipped from thefirst week of December. Also, it was noted that some sales would be lost;however, it was expected that the Bindeez brand would grow for the year as awhole. The latest position is that the exhaustive quality assurance and safety testing,together with sourcing a new manufacturing facility to produce Bindeez productswhere the production process can be monitored more closely to ensure consistentquality, has taken longer than originally anticipated. This is because it isparamount that the products meet both the international safety guidelines aswell as satisfying the Chinese Authorities export standards for productsproduced in the country. The impact of the delay is that the Group is now likely to lose up to £2.5million of revenue from the Bindeez range in the run up to Christmas as well asincurring the additional costs of the product recall. We do not expect Bindeezto be back to the full sales level until the end of January 2008. Whilst this has been an unfortunate and regrettable incident, it should be notedthat sales of Bindeez represents around 5 per cent of overall Group sales, andthe recalled products less than 2.5 per cent. The Group has succeeded in developing its product portfolio with good saleableand safe product over the past years and this trend is expected to continue. Therecall of Bindeez products is expected to have only a temporary effect on Groupperformance. The Directors will provide further updates on Bindeez as appropriate. With fourweeks left until Christmas it is still too early to comment on trading but theCompany will of course be providing an update at the Annual General Meeting tobe held on 16 January 2008. Enquiries:Richard King, Chairman Fiona Tooley, DirectorKiran Shah, Group Finance Director & Joint MD Keith Gabriel, Senior Account ManagerThe Character Group plc Citigate Dewe RogersonTel: +44 (0) 20 8949 5898 Tel: +44 (0) 121 455 8370Mobile: +44 (0) 7836 250150 (RK) Mobile: +44 (0) 7785 703523 (FMT)Mobile: +44 (0) 7956 278522 (KS)www.thecharacter.comwww.character-online.co.uk Richard ThompsonPhilip DaviesCharles Stanley SecuritiesNominated AdviserTel: +44 (0) 20 7149 6000 This information is provided by RNS The company news service from the London Stock Exchange