AMR Armour Grp

Armour Group PLC (AMR.LN), the consumer electronics group, Thursday said that, with the expectation that demand in the U.K. consumer electronics market will continue to be weak for the remainder of this year, it now expects to report a loss for the full year to Aug 31, 2011.

MAIN FACTS:

-Current trading performance adversely affected by the weak U.K. economic environment.

-Market conditions in the Group's core U.K. retail sales channels, which account for 60% of total Group sales, are difficult and have deteriorated significantly over the last six weeks.

-Consumer demand and confidence has weakened, which has directly impacted the Group's trading performance.

-Whilst the U.K. retail sales channel is challenging, the Group's non-retail automotive business has delivered record growth for the first six months of the year with sales increasing by 74%.

-In addition, the Group's Nordic and Asian operations have continued to make encouraging progress with sales up by 22% on the prior year comparatives.

-In response to the difficult U.K. retail trading environment, the management are taking the appropriate actions to mitigate the downside impact on the Group's financial performance; These actions include a strategic review of current activities and initiatives, cost and stock reduction as well as a re-structuring with a view to sizing the Group appropriately in the context that the current weak retail market conditions may persist well into 2012.

-Group agreed new lending facilities in December 2010 with GE Commercial Finance Limited; These facilities provide variable funding based on the levels of sales and inventory.

-Board believes that the response and actions being taken by the management to the further weakening in the U.K. retail environment will, even at much reduced revenue levels, will return the Group to profit in the year to Aug 31, 2012.

-Shares closed Wednesday at GBP0.06 valuing the company at GBP5.46 million.

-By Jana Weigand, Dow Jones Newswires; 44-20-7842-9314; jana.weigand@dowjones.com

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