(POGL.L) Plant Offshore Group Ltd Buy/Sell

Note:

The highlighted financial information for the six months ended 30 June 2009, other than balance sheet items, has been translated using RM5.4662:£1 (the average month-end exchange rate from January to June 2009). The balance sheet items have been translated using the closing date exchange rate of RM5.9300:£1.

The comparable financial information for the six months ended 30 June 2008 has been translated using RM6.3735:£1 ((the average month-end exchange rate from January to June 2008).

Mr Cho Nam Sang, Non-Executive Chairman of POGL, commented:

"Despite a challenging business environment given the current weakness in the global economy, the group managed to report a small profit for the six month period.

"Although reports on the global economy are mixed, we remain cautiously optimistic in securing further contracts, particularly in Malaysia."

Plant Offshore Group Limited

Hang Chin Juan, CEO Tel: +603 7805 5001

hang_cj@plantoffshore.com

Kenneth Chai, Head of Corporate

kenneth_cct@plantoffshore.com

www.plantoffshore.com

Allenby Capital Limited

Imran Ahmad/Nick Athanas Tel: +44(0)20 7510 8600

Threadneedle Communications

Josh Royston / Graham Herring Tel: +44(0)20 7653 9850

About POGL:

POGL is the holding company of an established and profitable group of companies engaged in the business of providing integrated, multi-discipline EPCM services to the oil and gas (onshore and offshore), petrochemical, biodiesel, energy and other related industries. The group operates primarily in the ASEAN region but this focus is expanding, with the group having won contracts in the Middle East. The services of POGL are focused on EPCM services. This is broken down and incorporates the following features:

POGL listed on AIM, a market of the London Stock Exchange, in July 2007. For more information on the company, please visit www.plantoffshore.com.

Chairman's Statement

I am pleased to present the interim results of POGL for the period ended 30 June 2009. This period has been a difficult and highly challenging one, not just for us, but also for numerous other companies worldwide as a result of the global recession. Our turnover and profit margins have been adversely affected by these challenges and we are behind management expectations for the full year. Nevertheless, I am pleased to be able to report that we are still profitable for the six month period to 30 June 2009 despite the present market conditions. Also, we believe there is a good possibility of securing new contracts from Malaysian clients in the second half of this financial year for EPCM contracts.

With oil prices recovering to $72.69 a barrel in June 2009 compared to the lowest price of $33.87 a barrel this year, we expect long-term investment in oil and gas infrastructure to continue and to remain strong. Also, given the high demand for oil and gas products in most industries throughout the world, there is a positive effect on the provision of oil and gas services.

Notwithstanding the near-term adverse industry conditions, the Board believes the long term outlook remains favourable. We believe demand for POGL's EPCM services should, over time, increase as overall energy demand and use over the long-term is expected to continue to increase steadily, particularly in developing countries. Besides this, we will continue to tender and negotiate with clients for new contracts to replenish our order book. We remain cautiously optimistic that these tenders and negotiations will turn into contracts in the second half of this financial year. Our current major client is Oilfab Sdn Bhd and we expect new oil and gas contracts from them. We also have tenders in place for an oil and gas contract with RBS International Sdn Bhd and are in negotiations with a Malaysian healthcare and nutraceutical company for an EPCM contract. However, we acknowledge that, given the general weak market sentiment, the timing of awarding of new contracts from clients is uncertain.

Financial Performance

Group revenue, profit from operations, profit before tax and basic earnings per share for the six months ended 30 June 2009 declined compared with the six months ended 30 June 2008. This was largely due to our clients' request to delay some existing projects and thinning profit margins attributed to stiff competition from our competitors. In addition, the current weak market sentiment has led to a lower level of investment, resulting in fewer available contracts in the marketplace.

Group revenue was down 26% to RM24.5m (£4.5m), profit from operations down 43% to RM1,099,000 (£201,000), profit before tax down 47% to RM956,000 (£175,000), basic earnings per share was also down 58% to RM0.004 (£0.0007) and group cash flow from operating activities decreased by 85% to RM394,000 (£72,000).

Current trading and outlook

During the period under review, we have completed two engineering contracts in Malaysia. We have seven ongoing EPCM contracts in hand that are expected to complete by the end of 2009. However, some of the group's existing projects have been delayed due to changes in the clients' design specifications and requirements. One project in particular, the EPCM of a biodiesel production plant in Indonesia, has been temporarily put on hold due to the weak local economy. However, we expect this project to kick-start again, at the latest, by the second quarter of 2010. Besides this, a few contracts that we expect to secure this year have been delayed. We have also experienced a delay in the receipt of payments from our clients. As a result, we anticipate results for the full year will be below management expectations. Notwithstanding this, and despite the various challenges faced by the group, we are able to manage our cash flow position.

The group currently has ongoing contracts and work in progress in excess of RM151 million, covering the next 18 months. In addition, the group has tendered for onshore and offshore oil and gas contracts in Malaysia and overseas amounting to RM426 million. However, given the general weak market sentiment, the timing of awarding of new contracts from clients is uncertain.

Finally, on behalf of the Board of Directors, I would like to thank all our management and staff for their continued dedication, hard work and commitment during the period under review. Your patience and dedication in this trying period is greatly appreciated.

Mr. Cho Nam Sang

Non-Executive Chairman

15 September 2009

Consolidated Statement of Comprehensive Income for the six months ended 30 June 2009
Six months ended Six months ended Year ended
30th June 2009 30th June 2008 31st December 2008
Unaudited Unaudited and restated Audited

Revenue 24,507 33,102 64,843
Cost of sales (20,403) (28,082)
(53,204)
Gross profit 4,104 5,020 11,639
Other Operating income 7 13 53
Total Income 4,111 5,033 11,692
Administrative expenses (2,209) (2,770) (5,630)
Other Operating expenses (803) (332) (955)
Profit from operations 1,099 1,931 5,107
Finance costs (143) (112) (264)
Profit before taxation 956 1,819 4,843
Taxation (320) (322) (130)
Profit after taxation 636 1,497 4,713

Other comprehensive income
Exchange difference on 39 7 (122)

translating foreign operations

Total comprehensive income for 4,591
the period 675 1,499

Profit attributable to:
Equity holders of the Company 656 1,496 4,939
Minority interests (20) 1 (226)
Profit for the period 636 1,497 4,713

Total comprehensive income attributable to:
Equity holders of the Company 675 1,499 4,591
Minority interests - - -
Profit for the period 675 1,499 4,591

Earnings per share - from continuing operations

Basic RM0.004 RM0.009 RM0.030
Fully diluted RM0.004 RM0.009 RM0.030

Consolidated Statement of Changes in Equity

Attributable to the equity holders of the Company
Non-Distributable Foreign currency
Reverse Distributable
Share Capital Share Premium Translation reserve Acquisition Reserve Retained Earnings Minority Interest Total Equity
Total

At 1 January 2009
113 19,347 (154) (8,166) 27,163 38,303 33 38,336
Profit for the financial - - 39 - 656
period 695 (16) 679

At 30 June 2009
113 19,347 (115) (8,166) 27,819 38,998 17 39,015
Attributable to the equity holders of the Company
Non-Distributable Foreign currency
Reverse Distributable
Share Capital Share Premium Translation reserve Acquisition Reserve Retained Earnings Minority Interest Total Equity
Total

At 1 January 2008
113 19,347 (32) (8,166) 22,224 33,486 266 33,752
Profit for the financial - - 7 - 1,497
period 1,504 1 1,505

At 30 June 2008
113 19,347 (25) (8,166) 23,721 34,990 267 35,257
Consolidated Statement of Financial Position as at the six months ended 30 June 2009
Six months ended Six months ended Year ended
30th June 2009 30th June 2008 31st December 2008
Unaudited Unaudited and restated Audited

Assets Non-current assets Property, plant and equipment
4,806 4,574 5,158
Goodwill 933 933 933
Software 259 194 231
Unquoted investment 32,000 - 32,000
Development cost 6,894 5,511 6,814

Total non-current assets
44,892 11,212 45,136

Current assets Trade receivables
13,469 35,688 6,724
Other receivables 3,786 3,384 3,759
Stock - 1,200 -

Property development cost

Amount due from contract
customers 9,635 10,747 7,396
Tax recoverable 582 - 762

Cash and bank balances
281 1,157 840
Total current assets 27,940 52,392 19,651
Total assets 72,832 63,604 64,787

Current liabilities
Trade payables (18,120) (15,814) (18,688)
Other payables (1,083) (784) (833)

Amount due to contract
customers (8,273) (4,285) (501)

Amount due to director

Borrowings - secured (4,650) (4,237) (4,520)
Tax payable - (1,287) -

Total current liabilities
(32,195) (26,412) (24,596)
Net current assets (4,255) 25,980 (4,945)

Non-current liabilities
Borrowings - secured (809) (1,287) (1,042)
Amount due to director (548) (548) (548)
Deferred tax liability (265) (100) (265)

Total non-current liabilities
(1,622) (1,935) (1,855)
Total liabilities (33,817) (28,347) (26,451)
Net assets 39,015 35,257 38,336

Equity
Called up share capital 113 113 113
Share premium 19,347 19,347 19,347

Foreign currency translation
reserve (115) (25) (154)

Reverse acquisition reserve
(8,166) (8,166) (8,166)
Retained earnings 27,819 23,721 27,163

Total equity attributable to equity holders of the Company

38,998 34,990 38,303
Minority interests 17 267 33
Total equity 39,015 35,257 38,336
Consolidated Statement of Cash Flows for the six months ended 30 June 2009
Six months ended Six months ended Year ended
30th June 2009 30th June 2008 31st December 2008
Unaudited Unaudited and restated Audited

Cash flow from operating activities

Profit before taxation 956 1,819 4,843

Adjustments for: Profit on disposal of property, plant and equipment

Depreciation 388 368 707
Interest expense 143 112 264

Amortization of development
cost 435 290 628

Unrealised loss/(gain) on
foreign exchange 23 (20) (40)

Amortization of intangible
assets 38 16 66
Allowance for doubtful debts 383 - 154

Operating profit before
changes in working capital 2,366 2,585 6,620

(Increase)/Decrease in
receivables (7,130) 18,843 15,239

Increase/(Decrease) in
payables (325) (15,158) (12,283)

(Increase)/Decrease in
property development cost - (86) (59)

(Increase)/Decrease in amount due from contract customers

(2,239) (745) 2,606
(Increase)/Decrease in stock - (1,200) -
(Increase)/Decrease in amount 9 - 53

due to directors Increase/(Decrease) in amount due to contract customers

7,772 (1,567) (5,352)

Cash flows generated from
operating activities 453 2,672 6,824
Interest paid (143) (112) (264)
Income tax paid (142) (597) (2,231)

Net cash generated from
operating activities 168 1,963 4,329

Cash flows from investing activities
Purchase of property, plant (444)
and equipment (26) (1,516)

Purchase of intangible assets

Proceeds from disposal of - -
property, plant and equipment 5
Addition to development cost (515) (1,209)
(2,785)
Net cash used in investing (609) (1,756)

activities

(4,421)

Cash flows from financing activities
(Decrease)/Increase in amount - -

due to director

-
(Repayment)/Drawdown of short 4 (94)

term borrowings

Repayment of term loan (72) (66) (134)
Repayment of hire purchase (154) (187)
payables (361)
Net cash (used)/generated from (222) (347)
financing activities (199)
Net decrease in cash and cash (663) (140)

equivalents

Effect of foreign exchange (13) -
rate changes (59)
Cash and cash equivalents at 767 1,297

beginning of period/year
1,117
Cash and cash equivalents at 91 1,157

end of period/year

Notes to the Unaudited Interim Report for the six months ended 30 June 2009
1. Significant Accounting Policies
(a) Basis of preparation and accounting policies

The financial information contained in the Interim Results has been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union. It has been prepared in accordance with IAS 34 "Interim Financial Reporting" and does not include all of the information required for full annual financial statements. Full details of the accounting policies adopted which are consistent with those disclosed in the consolidated financial statements for the year ending 31 December 2008.

(b) Basis of consolidation

The consolidated income statement and balance sheet include financial statements of the company and its subsidiaries made up to 30 June 2009.

(c) Nature of financial information

The financial information contained in this Interim Results for the six months ended 30 June 2009 and 30 June 2008 are unaudited. The comparative figures for the year ended 31 December 2008 do not constitute statutory financial statements of the group. Full audited accounts of the Group in respect of that financial period prepared in accordance with IFRS, which we received an unqualified audit opinion have been delivered to Registrar of Companies.

(d) Restatement of comparative

The comparative financial information for the period ended 30 June 2008 has been restated as a result of application of the Intangible Assets in accordance with IAS38.

(e) Revenue recognised for contract is in accordance to IAS 11 - Construction Contracts. Where the outcome of a contract work can be reliably estimated, contract revenue and contract costs are recognised as revenue and expenses respectively by using the stage of completion method. The stage of completion is measured by reference to the proportion of contract costs incurred for work performed to date to the estimated total contract costs. Where the outcome of a contract work cannot be reliably estimated, contract revenue is recognised to the extent of contract costs incurred that it is probable will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

(f) Significant accounting policies

The interim condensed consolidated financial statements have been prepared applying the same accounting policies that were applied in the preparation of the Company's published consolidated financial statements for the year ended 31 December 2008 except for the adoption of the following new and amended reporting standards, which are effective for periods commencing on or after 1 January 2009:

A new primary statement, "Consolidated Statement of Changes in Equity" is required containing information previously disclosed in the notes to the accounts. In addition, the Consolidated Statement of Recognised Income and Expense is replaced with the Consolidated Statement of Comprehensive Income, which may be shown separately or combined with the Income Statement.

This standard replaces IAS14 - "Segment Reporting" which required operating segments to be analysed into Primary (business) and Secondary (geographical) segments. IFRS8 requires that operating segments should be aligned with those reviewed by the "Chief Operating Decision Maker" which is considered to be the Board of Directors.

Various other amendments to standards and interpretations of standards are effective for periods commencing on or after 1 January 2009 as detailed in the 2008 Annual Report, none of which have any impact on reported results.

The consolidated financial information is presented in RM (Ringgit Malaysia) because the Group transact more of its business in RM (functional currency) than any other currency.

The highlighted financial information has been translated using the following exchange rate: RM5.4662:£1 (average month-end exchange rate from January to June 2009). The balance sheet item has been translated using the closing date exchange rate of RM5.9300:£1.

2. Taxation

The charge for income tax expense included in the interim results is based on the unaudited results for the six months ended 30 June 2009 and is calculated at the expected rate applicable to the group for the full year ending 31 December 2009.

3. Earnings per share

Earnings per share is calculated by dividing the profit attributable to equity shareholders in the period ended 30 June 2009 by the weighted average number of shares in issue in the period.

The profit attributable to equity shareholders in the period ended 30 June 2009 was RM636,000 (30 June 2008: RM1,496,000; year ended 31 December 2008: RM4,939,000). The weighted average number of shares in POGL in issue in the period ended 30 June 2009 was 166,666,667, the weighted average number of shares in the period ended 30 June 2008 was 166,666,667.

4. Contingent and other liabilities

Corporate guarantees amounting to RM5,075,000 given to licensed banks for credit facilities granted to a subsidiary company. Corporate guarantees amounting to RM1,051,000 given to licensed banks in respect of property, plant and equipment acquired under hire purchase arrangement by a subsidiary company.

5. Dividends

The Directors do not recommend the payment of any dividend in respect of the current interim ended 30 June 2009.

6. Segmental analysis

Six months ended Six months ended Year ended
30th June 2009 30th June 2008 31st December 2008
Unaudited Unaudited Audited

Revenue
EPCM 18,847 28,278 51,054
Supply of Specialists (SOS) 4,910 4,824 10,289
Engineering Design Software 750 - 3,500
24,507 33,102 64,843

Profit/Loss
EPCM 918 1,142 956
Supply of Specialists (SOS) 382 174 241

Engineering Design Software (257) (684) 2,005

Unallocated income/expenses (407) 865 1,511
TOTAL 636 1,497 4,713

Total Assets
EPCM 26,352 46,546 16,140
Supply of Specialists (SOS) 4,823 9,122 6,553
Engineering Design Software 8,063 5,981 7,781
Unallocated assets 33,594 1,955 34,313
TOTAL 72,832 63,604 64,787

Total Liabilities
EPCM 25,526 22,555 21,016
Supply of Specialists (SOS) 5,122 3,586 1,241
Engineering Design Software 2,046 1,380 2,530
Unallocated liabilities 1,123 826 1,664
TOTAL 33,817 28,347 26,451

7. Material events subsequent to the end of the quarter

There are no material events subsequent to the end of the quarter.

8. Dividends

The Company has not proposed or declared an interim dividend

9. Interim report

This interim statement was approved by the Board on 14 September 2009 and has not been audited by the Group's auditors Jeffreys Henry LLP. The interim results will be available from the Group's website: www.plantoffshore.com.

This information is provided by RNS The company news service from the London Stock Exchange

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