KBC Advanced Technologies plc Interim Results Six months to 30 June 2002.

KBC Advanced Technologies plcInterim Results

Six months to 30 June 2002

August 2002IMPROVING DOWNSTREAM PROFITS 2

Formed in 1979 as an independent consulting business

Global operation = USA/UK/Holland/Singapore/Japan

Serves the hydrocarbon = Over 200 clients worldwideprocess industry

Independent consultant = No conflict with contractors, process

licensors, catalyst and hardware

suppliers or operating oil companies

KBC - Leading consultants in the downstream oil industry


1. Process Consulting Profit Improvement Program (PIP) 11 month program Development of refinery simulation base case Identification of profit improvement opportunities

2. Implementation Services 2nd and 3rd year program Implementation of opportunities identified in PIP

3. Reliability, Availability & Maintenance (RAM) Turnaround and shut down optimisation Inspection and preventative maintenance best practice

KBC - Service Offering


KBC - Service Offering

4. Planning and Scheduling Management of crude and feedstock costs Reduction of inventories and internal movements

5. Other Services Remote monitoring and technical outsourcing Energy conservation and clean fuel studies Project risk assessment and analysis Capital project design Economic and market evaluation

6. Software Petrofine – refinery wide simulation Refinery reactor models


Overview – First Half 2002

Global economic slowdown gives rise to difficult trading conditions

Sales order cycle slow for first four months of the year

Signs of improvement in May and June

Successful integration of Petroleum Economics and Linnhoff March

Sale of Hyprotech by AEA to Aspen Technology Inc delays commercialisation of HYSYS.Refinery


Operational Highlights – First Half 2002

Slow start to 2002 with low utilisation

Pick up by end of period with six new PIPs started since 1 June

First PIP in Russia and second Petrochemical PIP started

Continued growth in South America with award of $15m multi–refinery, 30 month contract

Strong growth in Reliability and Maintenance services


Summarised profit and loss accountSummarised profit and loss account

£000 £000 £000

Turnover 20,186 19,347 42,000Operating profit 1,253 1,872 4,158Goodwill amortisation (204) - -Other operating exceptional items (851) 7,414 7,414Net Interest 204 315 713Profit before tax 402 9,601 12,285Taxation (140) (3,011) (3,972)Profit after tax 262 6,590 8,313Dividends (636) (620) (2,002)Retained (loss)/profit (374) 5,970 6,311

Earnings per share - basic 0.54p 13.67p 17.20p - fully diluted 0.54p 13.58p 17.09p - basic before goodwill

and expectional items 2.19p 2.90p 6.46p

Average number of shares in issue 48.5m 48.2m 48.3m

6 months to 6 months to 12 months to 30 June 2002 30 June 2001 31 Dec 2001


Summarised group cash flow statement

£000 £000 £000

Net cash from operations 1,6684,592 5,435

Operating exceptional items (851) 7,414 7,414

Net interest received 204315 713

Tax paid (1,586)(1,000) (3,176)

Capital expenditure (397)(1,851) (2,166)

Dividends paid (1,361)(1,249) (1,893)

New shares issued 36121 127

Net cash outflow from acquisitions (5,179) - ____ -

Net cash generated (7,466) 8,342 6,454

6 months to 6 months to 12 months to30 June 2002 30 June 2001 31 Dec 2001


Summarised group balance sheet

2002 2001 2001£000 £000 £000

Fixed assets 11,154 6,358 5,937

Net current assets (excl cash) 6,994 2,426 4,786

Cash 10,744 20,158 18,218

Creditors due after 1 year (600) - -

Provisions (719) (804) (775)

Net assets 27,573 28,138 28,166

Share capital and reserves 7,466 7,424 7,430Profit and loss 20,107 20,714 20,736

27,573 28,138 28,166

At 30 June At 30 June At 31 Dec


Revenues by region

2001 12 mths - £m

22.511.8

7.7

Europe/Middle East/Africa Americas Asia

58%20%

22%

2002 1st 6 mths - £m

5.8

10.1

4.3

Europe/Middle East/Africa Americas Asia

50%

21% 29%


Revenues by business area

£m

5.5

4.7

3.9

1.9

5.96.5

1.9 1.7

6.1

2.42.1

8.5

4.8

2.82.2

10.1

4.5

5.3

1.8

5.2

1.9

5.9

5.0

6.9

PIP/ProcessConsulting

ImplementationServices

Other Consulting Software (excludingSigmafine)

H2'99 H1'00 H2'00 H1'01 H2'01 H1'02


Order book value

0

5

10

15

20

25

30

Dec-98 Dec-99 Dec-00 Jun-01 Dec-01 Jun-02

£ M

illio

ns

within next 12 mths - base fees within next 12 mths - fees @ risk

> 12 mths ahead - base fees > 12 mths ahead - fees @ risk

£17M £21M £35M £40M £28M £29M


Consultant utilisation

79

64

73

65

74

0

10

20

30

40

50

60

70

80

90

%


Acquisitions profit and loss account

£000

Turnover 1,279 Operating profit 298Goodwill amortisation _(204)Operating profit afterGoodwill amortisation 94

Integration costs (206)

6 months to 30 June 2002


Acquisitions - continued

Petroleum Economics:(PEL)

Linnhoff March:(LM)

Operations relocated to KBC Walton office

PEL services added to PIP proposals

Core business on plan

New opportunities arise in due diligence and other services to Financial Institutions

Operations integrated with KBC Energy Business Line, now led from LM office in Manchester

Technology and tools rationalised to pick best in class from each company

Core business ahead of plan

New opportunities being pursued – refining and other process industries


Software alliance

Hyprotech sold by AEA to Aspen Technology

Rights to HYSYS.Refinery remain with AEA for duration of

agreement with KBC

Arbitration continues to resolve commercial difficulties

Discussions with Aspen Technology and AEA are ongoing to

attempt to find resolution of all issues

Sales of HYSYS.Refinery software on hold until disagreement

resolved


Longer term industry outlook

Fall in refinery margins in last 12 months and continued over-capacity leading to focus on costs and profitability

Budgetary constraints reduce discretionary expenditure for consulting services in current economic downturn

Competitive pressures of globalisation, deregulation and clean fuel specifications will continue to impact the oil industry

Short term prospects of improvement in product demand limited

No significant change in the number of large complex sites – the key market for KBC’s services


Penetration of Available PIP Marketat 30 June 2002

Nu

mb

er o

f re

fin

erie

s

0

10

20

30

40

50

60

70

80

N America S America W Europe EE / FSU Africa Asia Pacif ic Middle East

KBC Penetrated Available Market

Total Refineries 151

Available Market 69

75

33

85

67

94

65

37

14

98

71

67

42

TOTAL AVAILABLE

MARKET

Excludes refineries

owned by Exxon orShell

Excludes refineries under

30,000 barrels a day (bbl)

Includes:-

25% of refineries

30,000-50,000bbl

50% of refineries

50,000-70,000bbl

100% of refineries

over 70,000bbl

KBC experience has

shown that profit

opportunities are

greater for more complex

refineries over 70,000bbl


Strategy

Resolve difficulties with Software partnership with AEA and Aspen

Technology

Develop a ‘World Class Refining’ product to meet the vision and the needs

of our clients, typically a 5 year program

Develop and/or acquire a broad range of services to address the expanded

product requirements

Seek to increase further the length of client engagements through

evergreen technical support services

Reduce vulnerability of KBC revenue streams to economic cycle

KBC Advanced Technologies plc Interim Results Six months to 30 June 2002.

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