BNT Basepoint

RNS Number:6584C
Basepoint PLC
07 September 2004

BASEPOINT PLC

Breakdown of site acquisition negotiations

Basepoint plc ("the Company") announces that the landowners of a site for the
development of a new Managed Business, Innovation & Enterprise Centre ("MBEC")
at Farnham have withdrawn from the site disposal at the final stage of
documentation. This is expected to have a material impact on the results for the
financial year to 28 February 2005.

The Company has incurred considerable costs in the design and planning of this
development and had already obtained a detailed planning consent. The building
contract has also been tendered and a contractor selected for a scheduled start
on site this month.

The Company estimates that the loss of this development at such a late stage in
the procurement process will impact on the results for the current financial
year, with a one-off charge for abortive costs of #130,000. In addition to the
substantial abortive costs charged in the six months to 31 August, there will be
an associated loss of development revenue anticipated for the second half of the
financial year amounting to #270,000. The Company does not anticipate any impact
on current dividend levels.

Elsewhere, work is progressing well on securing new contracts for the
development of MBECs for Regional Development Agencies which, subject to
confirmation, are currently expected to contribute to second half profits.
However, the Company does not anticipate that it will be possible to accelerate
work on our other, alternative private sector development proposals to replace
Farnham or to benefit materially the current financial year.

Robert Cleaver, Chief Executive, commented on the situation:
"In seeking to develop new MBECs, we are always exposed to the risk of incurring
abortive costs. That we have been successful in avoiding any such costs on all
thirteen of the schemes developed to date demonstrates the level of expertise
that exists within the Company, but does not alleviate our disappointment at the
termination of the Farnham project at this late stage. We always seek to keep
the Company's risk exposure to a minimum, but it is inevitable that we must
commit costs to a scheme to investigate viability, environmental issues,
planning and construction aspects whilst simultaneously seeking to reach
agreement on the legal format for land acquisition, be it freehold or leasehold.
In our experience losses of this nature are very rare and we will strive to
ensure that any similar situation is avoided.

Looking ahead we remain confident in our ability to deliver new, successful
projects from our existing pipeline."

Contacts for further information

Robert Cleaver, Chief Executive
Tel: 01962 842244 e-mail Robcleaver@basepoint.co.uk

David Boakes, Finance & Operations
Tel: 01962 842244 e-mail davidboakes@basepoint.co.uk

Nicola Horton, Director Smith & Williamson Corporate Finance Ltd
Tel: 0207 637 5377 e-mail nah@smith.williamson.co.uk





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

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