• Group turnover (including VAT), up 5.8% to £477 million (2000: £451 million)
  • Operating profit less interest up 15.7% to £16.1 million (2000: £13.9 million)
  • Earnings per share up 17.9% to 7.9p (2000: 6.7p)
  • Total dividend increases by 18.2% to 2.6p (2000: 2.2p)
  • Earnings per share up 65% over 3 years
  • Agreement to outsource distribution function

Commenting today, Martin Hyson, Chief Executive, said:

'We are pleased to report this performance which has resulted in our sixth successive year of profit growth and confirms that our strategy of developing fresh food neighbourhood supermarkets is successful.

During this year we have taken a number of initiatives, the acceleration of a store opening programme, the introduction of Budgens Local, the outsourcing of our Distribution function and the closure of Budgens Direct. All of these initiatives are designed to focus the management team on the core business.

Trading in the year has started well with 6.6% growth in like-for-like sales for the first eight weeks. Budgens is ideally placed to take advantage of customers' requirement for a good quality food retailer in their local neighbourhood and I am confident that the current year will be one of solid growth.'

Enquiries:

Martin Hyson Chief Executive 020 7404 5959 on 5th July
Christian Williams Deputy Executive Chairman 020 8422 9511 thereafter
Andrew Fenwick
Catriona Booth
Brunswick 020 7404 5959

CHAIRMAN'S STATEMENT
Audited Results for the 52 weeks
ended 29 April 2001

BUILDING ON SUCCESS

The strategy of continuing to develop local convenience stores supplying a large range of quality fresh food, together with a sound and competitive grocery offer, has enabled Budgens to produce our sixth year of growth and record profits.  Our decision to concentrate on the convenience sector and our heavy emphasis on customer care and fresh foods continues to reap rewards.

The attributable profit of £13.4 million is an increase of £2.0 million or 17.9% over last year (2000: £11.4 million).  Turnover, including VAT, advanced to £477m, an increase of 5.8%.  Retail operating profit, after interest, increased to £16.1 million (2000: £13.9 million) an improvement of 15.7%.

Pre-tax profit of £17.2 million increased by £2.6 million or 17.8% (2000: £14.6 million).  Basic earnings per share grew by 17.9% to 7.9p compared to last year's figure of 6.7p and have now increased, cumulatively, by 65% in a three year period.  EBITDA increased to £29.9 million and this is 11.0% above last year at £26.9 million.

DIVIDEND

On the basis of these results, your directors are recommending a final dividend of 1.9p (2000: 1.6p) payable on 5 October 2001 to holders of ordinary shares registered at the close of business on 14 September 2001.  This makes a total payment of 2.6p per share, an increase of 18.2%, which is covered three times by attributable profits.

STORE DEVELOPMENT

This year has seen eleven further store openings.  All these stores are performing in line with expectations and continue to support our policy of developing local neighbourhood stores which are the alternative shopping experience to the major supermarket groups.

There is considerable opportunity for Budgens to develop new stores.  These opportunities are located in small towns, large villages and inner city areas. We have strengthened our site acquisition team to enable us to accelerate our rate of store openings.

The successful refit programme has continued with a further ten stores converted.  A further seven stores will be re-fitted in the current year.

We have continued to review our b2 operation and further changes have been made to the range of products and layout.  A programme of fascia change to Budgens Express is now underway and will be completed in all suitable stores by the end of this current year.

SALES DEVELOPMENT AND MARKETING

These strong results of the Group demonstrate the success of our concept. The demand for good, local, shopping facilities has never been greater and Budgens is ideally placed to maximise this opportunity.

Notwithstanding the poor summer weather during 2000, the Group increased its turnover by 5.8% which includes the closure and disposal of one store at Botley in Oxfordshire.  Our concentration on providing quality fresh foods and a competitive promotional programme has achieved full-year like-for-like sales of 3.2%.

These like-for-like sales have been achieved in the face of substantial promotional activity by the major supermarket groups and this performance gives us great confidence for the future.

Our policy of supporting local British producers will continue and we are constantly reviewing our customer offer.  New merchandising standards have been introduced and great care is taken in product selection.

The development of our own-label fresh foods continues with an additional 280 lines introduced and this progress will continue into the current year.  The re-allocation of chilled space in existing and new stores has resulted in stores achieving up to 40% of sales in fresh foods.  The sales of Home Meal Replacement products continue to grow and, as an important part of the neighbourhood concept, will be further developed during the year.

Our range of fresh foods and a strong branded grocery range enables Budgens to be unique in the quality of offer for local neighbourhood shopping.

PETROL FORECOURTS

This division continues to develop successfully.  Our relationships with Q8 and Total are producing considerable sales increases from the 29 sites. There is good opportunity for future growth and Budgens remains dedicated to developing fresh food convenience stores on petrol forecourts.

The trial with Conoco indicated that Budgens was unlikely to receive an acceptable return from operating the twelve sites and it was mutually agreed to cease the arrangement.

BUDGENS LOCAL

Budgens Local was launched in July 2000 and is performing above both our expectations and those of the independent retailers who have joined the scheme.  The concept of an independent retailer adopting the Budgens' fresh formula is proving successful with 24 stores currently operating through four independent retailers.

The daily delivery of fresh foods, the marketing support, store layout and range offer has proved to be highly attractive to the Budgens Local customers. We believe we will achieve our target of fifty stores by July 2002.

DISTRIBUTION

Our depot at Wellingborough continues to be central to the Budgens' story.  It is this facility that creates the principal point of difference between Budgens and our competition. The ability to deliver all product groups and, in particular, fresh and chilled foods daily to our stores is a main factor in our success.

We have seen two developments at our Wellingborough depot.

Firstly, during the year, we agreed contractual terms with Gist (BOC Distribution Services) to manage our distribution fleet and, following the success of this project, we agreed terms with them on 1 July for the management of the warehouse function. The out-sourcing of this activity will allow the Group to give additional focus to developing the core business.

Secondly, we have acquired three acres of freehold land to allow us to build an additional facility to accommodate further expansion. However, the current depot still has considerable spare capacity.

CAPITAL EXPENDITURE AND GEARING

Capital expenditure of £24.3 million was a decrease of £5.7 million over the prior year.  The expenditure was financed out of operating cash flow and bank facilities supported by lease finance of £11.7 million which, in turn, strengthened the balance sheet position.

Gearing at the year-end was 32.1% with borrowing largely represented by the convertible loan stock of £29.2 million. The Group has the opportunity to use substantial, unsecured, unutilised banking facilities to provide the necessary funds for either organic or acquisitive growth.

BOARD

Last year saw a number of changes and I am pleased to report that the team has worked well and extremely hard to deliver these results.  Martin Hyson has proved to be a dynamic and enthusiastic leader; his retail knowledge and his experience is first class and he leads a powerful and cohesive team.

I am also pleased to report that Seamus Scally (Group Managing Director - Musgrave Group Limited) and Eoin McGettigan  (Executive Chairman - Super- alu Centra Division) joined the Board as Non-Executive Directors on 29 August 2000.  We have formed a good relationship and received considerable support from these two new Musgrave colleagues.

TEAM MEMBERS AT BUDGENS

Individuals count within Budgens and a large factor in our success is the development of our team members.  This is clearly highlighted by the newly- appointed Executive Board Members, all of whom have been part of a successful succession policy.  The openness and friendliness of the organisation encourages people development and creates the successful retail operations where customers come first.

The results for the year demonstrate that dedication and commitment and I thank them all for their consistent efforts and congratulate them on achieving another outstanding performance.

CURRENT TRADING AND OUTLOOK

Food retailing in the UK continues to be competitive.  Budgens' policy of developing first-class local shopping facilities with heavy emphasis on fresh food enables the business, not only to prosper, but also to take a leading role within the UK convenience shopping market.

The current year has already produced two new stores at Waddington in Lincolnshire and Clerkenwell in London and we continue to make every effort to grow the retail estate.  Budgens Local will re-badge nine stores from the remaining Anglian Convenience Stores and agreement has been reached to develop a further six stores with Q8.

The current year has continued to be buoyant and sales for the first eight weeks are 10.8% ahead of the same period last year and profit margins and earnings are in line with our projections.  Assisted by favourable weather, like-for-like sales are 6.6% ahead which bodes well for the year as a whole.

Clive Clague
Chairman
5 July 2001

In August, copies of the Annual Report and Accounts will be sent to shareholders and will also be available from Stonefield Way, Ruislip, Middlesex, HA4 0JR, the registered office of the Group.


                              BUDGENS PLC
                  CONSOLIDATED PROFIT AND LOSS ACCOUNT
                  FOR THE 52 WEEKS ENDED 29 APRIL 2001

                                  Notes  52 Weeks Ended   52 Weeks Ended
                                               29 April    30 April 2000
                                                  £ 000            £ 000
-------------------------------------------------------------------------
Group turnover including VAT                             
Continuing operations                           476,076          451,145
Acquisitions                                      1,354                -
                                        ---------------  ---------------
                                                         
                                                477,430          451,145
Value Added Tax                                (32,105)         (30,373)
                                        ---------------  ---------------
                                                         
Group turnover excluding VAT                             
                                                         
Continuing operations                           444,023          420,772
Acquisitions                                      1,302                -
                                        ---------------  ---------------
                                                445,325          420,772
                                                         
Cost of sales                                 (386,598)        (368,583)
                                        ---------------  ---------------
Gross Profit                                     58,727           52,189
                                                         
Distribution costs                             (25,714)         (23,439)
Administrative expenses                        (14,173)         (12,611)
                                        ---------------  ---------------
                                                         
Operative Profit/(Loss)                                  
Continuing operations                            18,866           16,139
Acquisitions                                       (26)                -
                                        ---------------  ---------------
                                                         
                                                 18,840           16,139
Net profit on disposal of fixed                          
asset                                             1,080              665
Net interest payable                            (2,759)          (2,242)
                                        ---------------  ---------------
Profit on ordinary activities                            
before taxation                                  17,161           14,562
                                                         
Tax charge on ordinary                                   
activities                            1         (3,775)          (3,204)
                                        ---------------  ---------------
Profit attributable to                                   
shareholders for the financial                           
period                                           13,386           11,358
Dividends paid                        2         (1,200)          (3,749)
Dividends proposed                    2         (3,246)                -
                                        ---------------  ---------------
Retained profit for the period                    8,940            7,609
                                        ===============  ===============
                                                         
Earnings per share                                       
Basic                                 3           7.9 p            6.7 p
Diluted                               3           6.4 p            5.5 p
                                                         
Dividend per share                    2           2.6 p            2.2 p
Operating profit (% sales)                         4.2%             3.8%
                                                         
The notes on pages 8 to 10 form                          
part of these accounts.




                                BUDGENS PLC
                              BALANCE SHEETS
                           AS AT 29 APRIL 2001

                                         Group              Company
                            Notes     2001      2000      2001       2000
                                     £ 000      £000     £ 000       £000
-------------------------------------------------------------------------
Fixed assets                                                     
Goodwill                             3,080     1,237         -          -
Tangible assets                    150,831   146,295         -          -
Investments                            935       351    36,872     36,872
                                  --------  --------  --------   --------
                                   154,846   147,883    36,872     36,872
                                  --------  --------  --------   --------
Current assets                                                   
Assets held for resale                   -       527         -          -
Stock                               29,329    31,406         -          -
Debtors:                                                         
Amounts falling due after                                        
more than one year                     113         -         -          -
Amounts falling due within                                       
one year                            24,289    20,544    61,267     55,202
Cash at bank and in hand            11,999    10,483    49,843     39,879
                                  --------  --------  --------   --------
                                    65,730    62,960   111,110     95,081
Creditors: amounts falling                                       
due within one year               (82,964)  (83,475)  (55,079)   (54,458)
                                                                 
Net current                                                      
(liabilities)/assets              (17,234)  (20,515)    56,031     40,623
                                  --------  --------  --------   --------
                                                                 
Total assets less current                                        
liabilities                        137,612   127,368    92,903     77,495
                                                                 
Creditors: amounts falling                                       
due after more than one
year
Finance leases and hire            (3,367)   (1,950)         -          -
purchase contracts
Other creditors                      (307)     (336)         -          -
Convertible bonds                 (29,249)  (29,279)  (29,249)   (29,279)
                                  --------  --------  --------   --------
                                  (32,923)  (31,565)  (29,249)   (29,279)
Provisions for liabilities                                       
and charges                        (8,694)   (8,906)         -          -
                                  --------  --------  --------   --------
                                    95,995    86,897    63,654     48,216
                                  ========  ========  ========   ========
                                                                 
Capital and reserves                                             
                                                                 
Called up share capital             17,084    17,049    17,084     17,049
Share premium account               27,938    27,815    27,938     27,815
Profit and loss account             50,973    42,033    18,632      3,352
                                  --------  --------  --------   --------
                                                                 
                                  --------  --------  --------   --------
Total Shareholders Funds        4   95,995    86,897    63,654     48,216
                                  ========  ========  ========   ========
                                                                 
The notes on pages 8 to 10 form part of these accounts




                               BUDGENS PLC
                     CONSOLIDATED CASH FLOW STATEMENT
                   FOR THE 52 WEEKS ENDED 29 APRIL 2001

                                           52 Weeks Ended  52 Weeks Ended
                                            29 April 2001   30 April 2000
                                   Notes            £ 000           £ 000
-------------------------------------------------------------------------
Operating profit                                   18,840          16,139
                                                          
Depreciation charges                                9,843          10,020
Amortisation of goodwill                              100              68
Loss on sale of other tangible                            
fixed assets                                          762             424
Net movement in provisions                        (1,041)           (728)
Decrease/(Increase) in stocks                       2,241           (669)
Increase in debtors                               (3,855)         (5,667)
Decrease in creditors                             (4,669)         (5,676)
                                          --------------- ---------------
Net cash inflow from operating                            
activities                                         22,221          13,911

Returns on investments and servicing of finance
Interest paid                                     (2,384)         (2,179)
Interest element of finance lease rental                  
payments                                            (233)           (299)
                                          --------------- ---------------
                                                          
Cash outflow for returns on                               
investments and servicing of                              
finance                                           (2,617)         (2,478)
                                          --------------- ---------------
Taxation                                                  
UK Corporation tax paid                             (973)         (1,900)
                                          --------------- ---------------
                                                          
Capital expenditure                                       
Payments to acquire assets for                            
resale                                                  -           (527)
Payments to acquire tangible                              
fixed assets                                     (23,914)        (28,509)
Receipts from the sales of tangible                       
fixed assets                                       10,808          19,220
                                          --------------- ---------------
Net cash outflow from capital                             
expenditure                                      (13,106)         (9,816)
                                          --------------- ---------------
                                                          
Acquisitions                                              
Purchase of 50% share in joint                            
venture                                             (576)               -
Purchase of subsidiary                                    
undertaking                                       (1,153)           (238)
Net overdraft acquired with subsidiary                    
undertaking                                          (53)               -
                                          --------------- ---------------
                                                          
Net cash outflow from                                     
acquisitions                                      (1,782)           (238)
                                          --------------- ---------------
                                                          
                                          --------------- ---------------
Equity dividends paid                             (3,928)         (3,314)
                                          --------------- ---------------
                                                          
                                          --------------- ---------------
Net cash outflow before financing                   (185)         (3,835)
                                          --------------- ---------------
                                                          
Financing                                                 
Issue of ordinary share capital                        95             145
Receipts from new finance leases                    3,043               -
Short term bank loan                                    -           7,500
Repayment of loan notes                                 -           (100)
Capital element of finance lease                          
repayments                                        (1,437)         (2,105)
                                          --------------- ---------------
Net cash inflow from financing                      1,701           5,440
                                          --------------- ---------------
Increase in cash in the period         5            1,516           1,605
                                          =============== ===============
                                                          
Receipts from the sale of tangible fixed assets in 2001 include an inflow
of £3,950,000 (2000: £15,098,000) that relates to the £1,080,000
exceptional profit  (2000: £665,000) on the disposal of fixed assets.
During the year £63,000 of 5% convertible bonds were converted into
ordinary share capital.
Part of the consideration for the purchase of LC Seward & Sons Limited
comprised of unsecured loan notes.
The notes on pages 8 to 10 form part of these accounts.




                            NOTES TO THE ACCOUNTS
                  FOR THE 52 WEEKS ENDED 29 APRIL 2001
                                                              
Note 1: Tax Charge on Ordinary Activities                     
                                                        2001         2000
                                                       £ 000        £ 000
-------------------------------------------------------------------------
                                                              
Corporation Tax                                               
Current tax on income for the period                   2,946        1,359
-------------------------------------------------------------------------
                                                              
                                                       2,946        1,359
Deferred Tax                                                  
Deferred taxation charge for the period                  829        1,845
-------------------------------------------------------------------------
                                                       3,775        3,204
=========================================================================
                                                              
The tax charge for the period is low as a result of the profit on sale of
fixed assets that has been sheltered by a combination of capital losses
and roll-over relief and the current period movement in deferred tax
which has not been provided for. If provision were made in full for
deferred tax an additional charge of £1,828,000
(2000: £336,000) would result.


Note 2: Equity Dividends Paid and Proposed                        
                                                            2001    2000
                                                           £ 000   £ 000
-------------------------------------------------------------------------
                                                                  
Interim - paid 9 April 2001     0.7p per share                    
                                (2000: 0.6p per share)     1,200   1,021
Final  -  proposed              1.9p per share                    
                                (2000: 1.6p per share)     3,246   2,728
-------------------------------------------------------------------------
                                                                  
                                                           4,446   3,749
=========================================================================


Note 3: Earnings per Share
The basic earnings per share and diluted earnings per share calculations
have been prepared in accordance  with Financial Reporting Standard 14
'Earnings per Share'. The basic earnings per share calculations have been
based on the profit on ordinary activities after taxation of £13,386,000
(2000: £11,358,000) divided by the weighted average number of shares in
issue of 169,928,961 (2000: 169,415,415).

The diluted earnings per share is based on earnings of £14,412,000 (2000:
£12,386,000), being profit for the year of £13,386,000 (2000:
£11,358,000) adjusted by the interest expense relating to the liability
component of the convertible bond of £1,026,000 (2000: £1,028,000), and
on 224,651,578 (2000: 224,541,375) ordinary shares, calculated as
follows.

                                                         2001        2000
                                                          000         000
-------------------------------------------------------------------------
                                                               
Basic weighted average number of shares               169,929     169,415
Dilutive potential ordinary shares:                            
Employee share options                                  1,405       1,694
Convertible loan stock                                 53,317      53,432
-------------------------------------------------------------------------
                                                      224,651     224,541
=========================================================================


Note 4: Reconciliation of Movements in Equity                  
Shareholders' Funds
                                                               
                                                         2001        2000
                                                        £ 000       £ 000
-------------------------------------------------------------------------
                                                               
Profit attributable to shareholders for the                    
financial period                                       13,386      11,358
Dividends                                             (4,446)     (3,749)
-------------------------------------------------------------------------
                                                               
                                                        8,940       7,609
                                                               
New share capital subscribed                              158         304
-------------------------------------------------------------------------
                                                               
                                                        9,098       7,913
                                                               
Opening shareholders' funds                            86,897      78,984
-------------------------------------------------------------------------
                                                               
Closing shareholders' funds                            95,995      86,897
=========================================================================
                                                               


Note 5: Reconciliation of Net Cash Inflow to                   
Movement in Net Debt
                                                               
                                                         2001        2000
                                                        £ 000       £ 000
-------------------------------------------------------------------------
                                                               
Increase in cash                                        1,516       1,605
Net cash inflow from an increase in net debt and               
lease financing                                       (1,606)     (5,295)
-------------------------------------------------------------------------
Increase in net debt resulting from cash flows           (90)     (3,690)
Issue of loan notes on acquisition of L C Seward               
& Sons Limited                                        (1,121)           -
Conversion of unsecured convertible loan stock             63         159
Amortisation of issue costs                              (33)        (31)
-------------------------------------------------------------------------
Increase in net debt                                  (1,181)     (3,562)
Opening net debt                                     (29,648)    (26,086)
Closing net debt                                     (30,829)    (29,648)
=========================================================================




                                BUDGENS PLC
                        NOTES TO THE ACCOUNTANTS
                     FOR THE 52 WEEKS 29 APRIL 2001

Note 6: Analysis of Net Debt                                   
                                                               
                                                        Other  
                                                     non-cash    29 April
                           1 May 2000  Cash flows   Movements        2001
                                £ 000       £ 000       £ 000       £ 000
-------------------------------------------------------------------------
Cash at bank and in hand       10,483       1,516           -      11,999
Bank loans                    (7,500)           -           -     (7,500)
Loan notes due within one                                      
year                            (100)           -     (1,121)     (1,221)
Debt due after one year      (29,279)           -          30    (29,249)
Finance leases and hire                                        
purchase contracts            (3,252)     (1,606)           -     (4,858)
-------------------------------------------------------------------------
Total                        (29,648)        (90)     (1,091)    (30,829)
=========================================================================

Note 7: Full Accounts                                          

The above financial information does not constitute statutory accounts as
defined in Section 240 of the Companies Act 1985.  The comparative
financial information is based on the Group's statutory accounts for the
52 weeks ending 30 April 2000.  Those accounts, upon which the auditors
issued an unqualified opinion, have been delivered to the Registrar of
Companies.  The results contained in this preliminary announcement are
extracted from the Group's statutory accounts for the 52 weeks ending 29
April 2001 which carry an unqualified auditor's opinion.  These accounts
will be delivered to the Registrar.