Westminster Group Regulatory News (WSG)

16 December 2010

Westminster Group Plc

Trading update

Westminster Group Plc ('Westminster' or 'the Group'), the AIM listed supplier of system solutions and products to the security, defence, fire protection and safety markets worldwide, expects that its trading results for the second half of 2010 will be materially below market expectations with revenues broadly similar to the results for the first half, which is expected to result in an operating loss in excess of £2 million for the year to 31 December 2010.

In prior years, the second half of the year has been stronger than the first half owing to the timing of major contracts. In 2010 many Governments, which are the major customers of the Group, have delayed the award of major contracts due to the uncertainty surrounding public sector finances. As explained in our interim statement released on 23 September 2010, the timing of final contracts, and therefore revenue recognition, is not certain and therefore may impact on 2010 forecasts, which is now the case. The tenders submitted by Westminster remain the subject of ongoing discussion with the expectation that they become firm contracts.

Consequently, the Group has intensified its efforts with those Governments that are more likely to be able to award significant contracts in the near future, particularly in the Middle East. The results of those efforts appear to be very close to fruition, with the expectation of several major contracts being signed in the first quarter of 2011, however we must again highlight the uncertainty of timing.

The characteristics of the revenue in the second half of 2010 have shown an improvement on prior periods, in no small part through the contribution of increased numbers of smaller unit sales from the recently re-launched Westminster International web site.

Even without the winning of any new business, the Board of Westminster Group believes that it has sufficient working capital for the next 12 months primarily due to the contract with the Government of Southern Sudan which Westminster announced on 29 May 2008.

On 6 November 2009, Westminster announced a $2.72 million extension to the contract with the Government of Southern Sudan for security infrastructure and systems at Juba International Airport. The initial contact has suffered several delays, however the Directors believe that both the initial contract and its extension will be completed during the 3rd quarter of 2011.

In addition, the Board recognises that if Westminster does not enter into a new major contract before 31 March 2011 it will need to put into place a number of cost reduction measures in order to provide additional working capital headroom until a new major contract is signed. These measures have been minuted and approved by the board.

The Board of Westminster will update shareholders as soon as one of these major contract negotiations has been finalised.

Enquiries:

Peter Fowler 01295 756 300

Chief Executive - Westminster Group Plc

Nicholas Mearing-Smith 01295 756 300

Finance Director - Westminster Group Plc

Alex Clarkson 0161 831 1512

Nick Cowles

Zeus Capital Limited - Nominated Adviser

John Grant / Karen Kelly 020 7101 7070

XCAP Securities PLC - Broker

Tom Cooper/Paul Vann 0797 122 1972

Winningtons Financial tom.cooper@winningtons.co.uk

Notes:

Westminster Group plc is a leader in the supply of system solutions and products to the security, defence, fire protection and safety markets worldwide.

Westminster's principal activity is the design, supply and ongoing support of advanced technology security solutions, risk assessments and close protection services. These can range from product only assignments, such as the supply of specialised scanners, to the design and implementation of an integrated system solution such as a border detection and surveillance system. The majority of its customer base, by value, comprises governments and government agencies, non governmental organisations and blue chip commercial organisations.

For further information please visit www.wg-plc.com