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ELSEC reports excellent maiden interim results

January 28, 2000

Elsec, the leading service provider of products, support and training into the electronic security market, has produced another six months of sustained growth through increased market share and expansion.

The group, which listed in the electronics sector of the Johannesburg Stock Exchange on 20 May 1999, achieved excellent results for the six month period to 17 December 1999. Turnover increased by 16,2%, attributable profit by 25,5% and headline earnings per share by 7,7%. The group, at the interim stage, has achieved 53,4% of the attributable profit forecast for the year ended 30 June 2000. Elsec has performed in line with its forecasts as set out in its prospectus.

This growth is the result of strong organic growth in all divisions, Elvey SA, Elvey USA, SmartWater and Alarm Supplies.

Paul Wainstein, CEO of Elsec, points out: "Elvey SA's high levels of technology allowed us to increase our sales to most of the major security companies and consolidate our foothold in the area of building management security. Elvey Building Management, originally established to manage the support and distribution of Samsung CCTV products, has now entered into agreements with various companies including DeltaVision, C-Tec and IEI and has sourced several new products which will be marketed in due course. This division's award winning participation in exhibitions in Cape Town, Brazil and Ghana show the potential of this dynamic company."

Elvey USA sources and purchases state-of-the-art security equipment and services for export throughout Africa. Growth in this division was maintained at 25% per annum, which is above market trends.

The SmartWater range, of which Elsec is the sole sub-Saharan African distributor, represents the latest artificial DNA type technology in forensic crime fighting. This division is dedicated to bringing this range to developing markets in Africa. " SmartWater has shown excellent growth and we believe this growth trend will continue," commented Wainstein.

Alarm Supplies provides electronic security solutions to countries in Africa through franchise operations which have been established in Zimbabwe, Zambia and Mozambique. The Zimbabwean franchise has produced record earnings on a monthly basis and has established itself as the dominant solutions provider in the region.

As set out in the listings prospectus, the directors of Elsec do not currently contemplate declaring dividends in view of the group's anticipated growth.

"We are focusing on new digital and software technologies which shape the way security products develop and interface with people and property. This focus makes sound strategic sense, given the fact that security is becoming an increasingly critical factor for households, corporations and governments throughout the world. This, together with our dominance of this sector, means that the outlook for the remainder of the financial year is promising and we are confident that the group will continue to produce strong organic growth," said Wainstein.

For detail contact Paul Wainstein of Elvey Security Technologies on tel: (011) 401 6700, or fax: (011) 614 8213.

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