Chairman's Statement - Vindon Healthcare

For the year ended 31 December 2007, the Group increased its profit before tax by 37% to £1,338,000 (2006 - £972,000) having opened a new facility in Ireland and made its first sales in the United States of America and Belgium.

Having achieved the Group’s financial and operational objectives for the year, the Board is pleased to announce the Company’s intention to pay a maiden dividend of 0.1 pence per ordinary share.

A year of sound progress
Vindon supports global pharmaceutical development via its range of controlled environment products and services. Trading conditions in Vindon’s core markets of manufacturing and stability storage remained buoyant throughout 2007. In addition, the Group made promising progress with its new disaster recovery service for which the first major order was secured. In September 2007, Vindon opened a new facility in Tramore, County Waterford, Ireland, which allows customers to perform stability storage trials and provides a local base for the Group’s Irish service and validation engineers.

Vindon’s capability in the United Kingdom, Ireland, the United States of America and Europe enables clients to deploy one stability storage solution across all their countries of operation.

Further progress for 2008
The Group will consolidate all its UK operations into one new site at Kingsway in Rochdale, 9 miles from its existing premises. The financial aspects of this move are dealt with in more detail in the financial review. The new site will facilitate a significant expansion in manufacturing capability and will offer impressive independent facilities for stability storage.

The Tramore facility offers improved service and validation to the Group’s Irish customers. Vindon has four large stability storage chambers available and storage has commenced for five customers. The Board expects the Group to develop this market further in 2008.

The Group benefits from visibility of future income, arising both from annual service contracts and the unexpired term of stability storage trials in progress. As at the year end, the visible income amounted to £3.75 million (2006 - £3.70 million). This income is expected to be received over the next five years, with approximately half anticipated to be in 2008.

In recognition of the current trend for outsourcing in the pharmaceutical, medical and healthcare sectors, the Group has focused its sales team in these key market segments and has a service offering that the Directors believe is highly attractive and competitive. In addition, plans have been made to move the business into new and emerging markets. The early success achieved in winning orders in the United States of America and Belgium is evidence of the potential benefits.

Our people
I would like to pay tribute to our employees who have delivered all that has been asked of them in the highly technical industry in which the Group operates. I am constantly impressed by the skill, dedication and enthusiasm of the Vindon team.

Current trading
Vindon has made a good start to 2008 and the Board is pleased with the present order book position and new business enquiry levels.
Outlook

The Board believes that Vindon is well positioned for the future. The Group has a distinctive business, capable of substantial growth, which is backed by a robust financial platform and an enviable client list and track record. This, combined with its loyal and knowledgeable staff and excellent facilities, means that Vindon can face the challenges of the future with confidence.

Liam Ferguson
Chairman
18 March 2008