TAX.L Regulatory News (TAX)

05 March 2014

Eco City Vehicles PLC

("ECV" or "the Company")

 Directorate Changes and Trading Update

Eco City Vehicles PLC, the exclusive supplier of the licensed Mercedes Vito taxi, announces the following Director changes and trading update for the year ended 31 December 2013.

Director Changes

The Group announces a number of Board changes effective as of today:

· Chief Executive Trevor Parker has stepped down from the Board to pursue other interests

· Ran Oren has been appointed as non-executive director. Ran was previously the Company's Interim Finance Director in the period May 2012 to June 2013.

The process of recruiting a new CEO is underway, led by the Chairman. Meanwhile the CEO role and responsibilities will be fulfilled by the Company's existing directors.

Trading Update for year ended Dec 2013

· New Vito sales were steady at 543 vehicles in 2013 (2012: 561)

· Revenue for the year ended December 2013 increased by 5.2% to £32.0m (2012 £30.5m)

· EBITDA before non-recurring items is estimated to be in the region of £0.8m - £1.0m (2012: EBITDA £0.8m)

· Profit before tax from continuing operations and excluding non-recurring items improved to £0.25m (2012: loss £0.2m)

Since the beginning of the year new vehicle sales trading conditions have become challenging due to a combination of new entrants into the London taxi market and the recent Transport for London ambiguity regarding future changes to London taxi emissions requirements in 2018.

As previously disclosed in the Group's annual accounts Cabvision Limited, a previous related party, has an ongoing VAT claim with HMRC and £2.3m plus interest is assigned to KPM-UK Taxis Plc. The case was heard in September 2012 and judgment has been received in favour of the Group's former related party Cabvision Ltd. The exact amount to be received is in discussion between various parties as legal costs are likely to be significant. The amount received will improve the Group's balance sheet. As previously announced on 7 September 2012 the Company has agreed that any compensation net of corporation tax and legal costs received from HMRC as a result of the VAT Claim will be applied firstly in repayment of the KPM-UK Taxi Plc Discretionary Pension Scheme ("Pension Scheme") Loan and secondly (once the Pension Scheme Loan has been repaid in full) in repayment of the Global Meters Arrears in total of £1.2m and 0.4m as at 28 February 2014 respectively.

Given the uncertain outcome of the net monetary proceeds of the above claim and as a consequence of the current trading performance cash is being tightly managed. The Company retains the support of the Pension Scheme.

The Company is currently operating out of properties mainly owned by the Pension Scheme and some third party landlords. The Company is currently in discussions with the Pension Scheme with regards to the future development of the site.

As disclosed in the Company's interim results announcement, One80 Limited ("One80") continues its discussions with key suppliers on potential warranty-related vehicle upgrade programmes. There remains significant uncertainty over the structure of these programmes, and therefore over their cost, and how that cost will be borne by the various parties involved. In particular, One80 is in discussion with its holder of a non exclusive licence to convert the Mercedes Vito taxis. Should these negotiations not be successful, One80 is currently reviewing alternative options for the exploitation of its intellectual property.

Commenting on behalf of the Board John Swingewood said:

"I am pleased last year's results show an improvement over the previous year and were broadly in line with the budget. This quarter we are seeing a softening in sales of new Vito taxis and the board has taken a number steps to address this. Going forward the Board intends to diversify the Group into other taxi products and services in order to reduce its dependence on new London Vito taxi sales. To this end, we continue to grow our own rental fleet, currently based on the superior Vito taxi, to now over 45 vehicles. The Board and management team intend to achieve further diversification through acquisition.

I would like to welcome Ran Oren to the Board, he has an in depth knowledge of the business and well placed to assist with the new strategy.

Finally I would like to thank Trevor Parker for his contribution as CEO and I wish him well in the future."

Enquiries:

Additional information provided pursuant to AIM Rule 17

Ran Oren

Disclosures under AIM regulations

Mr Oren (43) holds, or has held, the following directorships within five years prior to the date of this announcement:

*Mr Oren acts as an interim director and was a director of Partner Logistics Holding UK Limited. Partner Logistics Holding UK Limited was put into liquidation by the directors.

Mr Oren was a director of Creative Outsourcing Solutions and COSi Holdings Limited (together "Creative Outsourcing") and other group companies related to them more than five years ago. Creative Outsourcing and some of the group companies (COSi (Holdings) Limited, COSi (SA) Limited, Creative Outsourcing Solutions International Limited, COSi (UK) Limited, COSi Wales Limited, Dragon Cosmetics Pension Trustees Limited and CW Cosmetics Limited) were put into administration by the directors as part of the sale of the trading company.

There is no other information that needs to be disclosed under pursuant to Schedule Two paragraph (g) of the AIM rules for companies.