Capital Management & Investment Plc (LON:CMIP) Preliminary Results

Capital Management & Investment Plc (LON:CMIP) Capital Management and Investment PLC

Preliminary Results for period ended 31 July 2008

Introduction

The recent turbulence in financial markets points toward a slow down in economic growth worldwide. Whilst we are understandably concerned about the impact that this will have on our two investee companies, we remain confident that Algeco Scotsman and Magticom - as market leading companies within their respective fields - are well positioned to cope with the difficult economic environment ahead.

Results for the half year

The Consolidated Income Statement for the six months ended 31 July 2008 shows a Profit Before Tax of £0.903m (2007 - £1.117m). This is the result of foreign currency gains on translation of £1.23m.

CMI's investments in Algeco Scotsman and Yola are reported at fair value. In both instances we believe fair value to be the original cost of the investment. Net Asset Value per share is 68.9p (62.6p on a fully diluted assuming the exercise of all the percentage warrants outstanding).

At the end of the period, CMI had net cash balances of £4.946 million.

Investment in Algeco Scotsman

Algeco Scotsman continued to grow its business during the period. It has continued its expansion into Eastern Europe and is exploring business opportunities in the Middle East and China. Meanwhile, it remains the market leader in the supply of modular space and storage solutions in the UK, France, Germany, Spain, and the USA.

Trading for the first half of the year in Europe has been broadly in line with budget and ahead of last year. The North American business has faced difficult trading conditions and is behind budget.

Current year end forecasts for the combined business are in line with expectations and are ahead of last year. The company is operating comfortably within its banking covenants.

Investment in Yola Investments Sarl ("Yola")

CMI, via its investment in Yola, indirectly owns approximately 7% of Magticom - the largest provider of mobile telephone services in the Republic of Georgia.

Magticom started the year with a strong performance compared to budget and last year. The conflict with Russia during August caused some damage both to the Georgian economy and to future economic prospects. The full effects of the conflict are yet to be determined.

Magticom's physical infrastructure, however, was not badly damaged by the conflict. The company has continued to perform well although there has been a slowdown in revenue growth.

The broader outlook for telephony services remains positive in the longer term. We do, however, expect this investment to take longer than originally anticipated to realise its full potential.





Strategy going forward

CMI continues to actively monitor its investments in Yola and Algeco Scotsman through regular meetings with the management teams of Algeco Scotsman and Magticom, receipt of monthly financial reports, and attendance at board meetings.

CMI has no plans at present to make any further new investments.

Dividends

The board is not recommending payment of a dividend for the period under review.



Hugh Osmond Chairman 28th October 2008 Consolidated Income Statement for the six month period ended 31st July 2008

Unaudited Unaudited Audited Twelve Six months Six months months Ended Ended Ended 31 July 31 January 31 July 2008 2007 2008

£'000 £'000 £'000

Gain on redemption of investments - 863 886 Fair value gain on investments - - 81,275 Other income - - 4,662 - 863 86,823

Other administrative expenses 3 783 (489) 1,132

Operating profit 783 374 87,955

Finance Income 120 743 1,171

Profit before tax 903 1,117 89,126

Taxation credit/ (expense) - 9 (17)

Profit for the period 903 1,126 89,109

Basic earnings per share 2 0.36p 0.45p 35.65p

Diluted earnings per share 2 0.33p 0.41p 32.08p

Consolidated Statement of Changes in Equity As at 31st July 2008

Share Share Merger Foreign Retained Total Capital Premium Reserve Currency Earnings Equity Translation Reserve £'000 £'000 £'000 £'000 £'000 £'000

Balance as at 1 2,499 38,109 1,693 (204) 23,742 65,839 February 2007

Exchange - - - 300 - 300 differences arising on translation of foreign operations

Credit in - - - - - - respect of share scheme charge

Net income - - - 300 - 300 recognised directly in equity

Profit for the - - - - 1,126 1,126 period

Total - - - 300 1,126 1,426 recognised income and expense for the year

Balance as at 2,499 38,109 1,693 96 24,868 67,265 31 July 2007

Exchange - - - 9,295 - 9,295 differences arising on translation of foreign operations

Credit in - - - - 73 73 respect of share scheme charge

Net income - - - 9,295 73 9,368 recognised directly in equity

Profit for the - - - - 87,986 87,986 year

Total - - - 9,295 88,059 97,354 recognised income and expense for the year

Balance as at 2,499 38,109 1,693 9,391 112,927 164,619 31 January 2008

Exchange - - - 6,817 - 6,817 differences arising on translation of foreign operations

Credit in - - - - - - respect of share scheme charge

Net income - - - 6,817 - 6,817 recognised directly in equity

Profit for the - - - - 903 903 year

Total - - - 6,817 903 7,720 recognised income and expense for the year

Balance as at 2,499 38,109 1,693 16,208 113,830 172,339 31 July 2008

Consolidated Balance Sheet As at 31st July 2008

Unaudited Unaudited Audited Six months Six months Twelve months Ended Ended Ended 31 July 2008 31 July 2007 31 January 2008

£'000 £'000 £'000

ASSETS Non Current assets Property, plant and - 3 - equipment Investments 171,420 28,140 163,072 171,420 28,143 163,072 Current assets Trade and other 543 201 246 receivables Cash and cash 4,946 39,567 5,207 equivalents Total Current Assets 5,489 39,768 5,453

Total Assets 176,909 67,911 168,525

LIABILITIES Current Liabilities Trade and other (727) (509) (258) payables Short Term Loan (3,660) - (3,468) Corporation tax (183) (137) (180) payables Total Current Liabilities (4,570) (646) (3,906)

TOTAL NET ASSETS 172,339 67,265 164,619

EQUITY Share capital 2,499 2,499 2,499 Share premium accounts 38,109 38,109 38,109 Merger reserve 1,693 1,693 1,693 Foreign Currency 16,208 96 9,391 Translation Reserve Profit and loss account 113,830 24,868 112,927

TOTAL EQUITY 172,339 67,265 164,619



Consolidated Cash Flow Statement For the six months ended 31st July 2008

Unaudited Unaudited Audited Six months Six months Twelve months Ended Ended Ended 31 July 2008 31 July 2007 31 January 2008 £'000 £'000 £'000 Cash flows from operating activities

Profit for the year 903 1,126 89,109 Adjustments for: Depreciation - 5 7 Gain on redemption of - (863) (886) fixed assets investments Fair value gain on - - (81,275) investment Income from fixed - - - asset investments Finance Income (120) (743) (1,171) Other Income - - (4,662) Equity settled - - 73 share-based payment expense Foreign Exchange Gains (1,394) - (2,163) Income tax expense - (9) 17 (611) (484) (951)

Cash flows from operating activities before changes in working capital and provisions

Decrease/ (Increase) in trade (297) 645 600 and other receivables Increase/ (Decrease) in trade 474 (1,195) (12) and other payables 177 (550) 588

Cash used in operations (434) (1,034) (363)

Income taxes paid - - 10 Interest paid - 9 - - 9 10

Net cash flows from operating (434) (1,025) (353) activities

Investing activities Purchase of - - (36,638) investments Redemption of - 1,453 - Ristretto Holdings shares Interest received 120 743 1,171 120 2,196 (35,467)

Net cash from/ (used in) (314) 1,171 (35,820) investing activities

Net cash from/ (used in) - - - financing activities

Net Increase/ (decrease) in (314) 1,171 (35,820) cash and cash equivalents

Cash and cash equivalents at 5,207 38,096 38,096 beginning of the year

Exchange gains/ (losses) on 53 300 2,931 cash and cash equivalents

Cash and cash equivalents at 4,946 39,567 5,207 end of the year



Notes

1 Basis of Preparation

These financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRS) issued by the International Accounting Standards Board (IASB) as adopted by European Union ("adopted IFRSs"), and are in accordance with IFRS as issued by the IASB and with those parts of the Companies Act 1985 applicable to companies preparing its financial statements in accordance with IFRS.

The principal accounting policies used in preparing the interim results are those the group expects to apply in its financial statements for the year ended 31 January 2009 and are unchanged from those disclosed in the Group's Report and Financial Statements for the year ended 31 January 2008.

The financial information for the six months ended 31 July 2008 and 31 July 2007 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 January 2008 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 reference 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 237(2) -(3) of the Companies Act 1985.

2 Earnings per ordinary share

The basic earnings per share of 0.36p (2007 - 0.45p per share) is calculated by reference to the profit after taxation of £903,000 (2007 - £1,126,000) and the weighted average number of ordinary shares in issue during the year of 249,938,158 (2007 - 249,938,158).

The diluted earnings per share of 0.33p (2007- 0.41p per share) is based on the above profit, and the diluted weighted average number of ordinary shares in issue during the year. The dilutive impact on the potential ordinary shares from unexercised warrants and share options is shown below:

The 500,000 approved and unapproved options granted at an exercise price of 43p are not dilutive at present. Consequently they have been omitted from the EPS calculation.

Unaudited Six Unaudited Six Audited Twelve months ended 31 months ended 31 months ended July 2008 July 2007 31 January 2008 Basic number of 249,938,158 249,938,158 249,938,158 shares Unexercised 25,410,379 27,763,401 27,831,730 warrants

275,348,537 277,701,559 277,769,888



3 Other administrative expenses

Other administrative expenses are shown as a surplus due to foreign exchange gains of £1,230,000.

4 Interim Report

Additional copies of the interim report are available from the Company Secretary, Capital Management and Investment PLC, 54 Baker Street, London W1U 7BU.

This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.

Capital Management & Investment Plc

ISIN: GB0001341816

Stock Identifier: XLON.CMIP