Carter & Carter Group PLC
13 July 2007



Immediate Release 13 July 2007

Carter and Carter Group plc
Trading statement

The Board is disappointed to announce that Carter and Carter has been
unsuccessful in its tenders for Phase 1 of Pathways To Work. The delay in the
announcement of these tenders was due to approval being required by the newly
appointed ministerial team at the Department for Work and Pensions.

Carter & Carter had been shortlisted in all 15 Phase 1 districts, but has not
been selected as preferred bidder in any of the districts. We expect to meet
with senior Government officials shortly to understand this further.

Carter & Carter is shortlisted in four of the sixteen districts for Phase 2 and
tender bids are due to be submitted on 19 July 2007. Preferred bidders are
expected to be selected during September 2007 with operational delivery due to
commence in April 2008. The four districts in which Carter & Carter has been
shortlisted are worth 45 million over three years.

Carter and Carter has outstanding bids with the LSC in relation to the current
work based learning tender round and, to date, has been successful in several
bids where it is currently in post tender negotiations. A further update will be
provided in due course.

Elsewhere in the business, since the publication of the trading statement on 29
June 2007, the Group's June management accounts have revealed that our
performance in our construction training activities was lower than we had
previously expected. We are also now anticipating a lower level of achievers in
July across our apprenticeship programmes and, together, we expect that these
two factors will reduce Group profits in the year to 31 July 2007 by c. 3m. In
addition, in Train to Gain, enrolments in the first 2 weeks of July are behind
our expectations at 600.

These matters, together with the fact that we will now be expensing through the
profit and loss account our bid costs associated with our unsuccessful tenders
on Phase 1 of Pathways to Work, mean that the Board is now of the view that the
Group's adjusted profit before tax* for the year ending 31 July 2007 will be in
the order of 10.5m.

Carter and Carter confirms that it is in the process of renegotiating its bank
facilities to reflect these revised expectations.

Contacts

Carter and Carter Group 0115 945 7250
Rodney Westhead - Chairman
John Green - Finance director

Buchanan 020 7466 5000
Mark Edwards / Suzanne Brocks

* Adjusted profit before tax is stated before amortisation of intangible assets
and exceptional costs.



This information is provided by RNS

Commiserations to all investors that lost money here, never put all your eggs in as they say and I hope you didnt.

Some very good learning points for those interested in fundamentals. In July 2007, this company released trading statement that profits for year to end July 2007 would be in the order of 10.5M. Not too bad you would think, for a consistently profitable business, although a couple of weeks earlier, another trading statement suggested figure of 15.5M and growth of 15-20% expected for year to July 2008. So what went wrong? The writing was on the wall with the half yearly figures to January 2007. These showed a cash outflow from basic operations of some 1.4M against cash inflow from those same operations of nearly 8M in the year to July 2006. Add in cost of acquisitions and debt ballooned from 59M at July 2006 to 86M at January 2007. With balance sheet surplus of just 62M including 132M of goodwill they just had no room to manoeuvre. Excellent demonstration of a profitable business going to the wall - clearly loss of the founder in tragic accident in the Spring of 2007 added to their problems, but over aggressive borrowing (helped perhaps by over aggressive lending) was imo their downfall.