HPS Hercules Props.

RNS Number:1303H
Hercules Property Services PLC
06 February 2003

                         Hercules Property Services Plc

                               Trading Statement

The board has completed its review of the trading performance of each of its
subsidiaries for the six months to 31 December 2002.  Having analysed the likely
impact of those results over the remainder of the current financial year, to 30
June 2003, it now believes that full year earnings will be below market
forecasts.  We anticipate that pre-tax and pre-amortisation profit will be in a
range between #8 million and #9 million.  The board maintains a positive
approach to its dividend policy, which will be in line with revised earnings.

There are two major factors behind this revision.  Firstly it has taken longer
than expected to turn around Deacon, our blocks of flats insurance intermediary.
Secondly there has been an underperformance by our commercial auction
business, Harman Healy.

Deacon is delivering a gradual improvement in its renewals retention rate, but
more slowly and at a lower margin than expected. The business has also had to
carry additional operating costs, in order to process business in an
underwriting environment considerably more difficult than anticipated.  In
contrast, trading at our other insurance intermediaries Farr, D.O.R and Cadogan,
has been in line with expectations, despite the generally difficult conditions.

Although we anticipate that the market will remain extremely competitive, with
insurer capacity and appetite remaining weak, we still believe that Deacon will
continue to improve its retention rates and new business volumes. During the
second half of the year it is expected to benefit from a number of new
underwriting facilities that will significantly enhance the product and customer
service offering.

In the second quarter, Harman Healy recruited a new management team and although
it is making satisfactory progress in developing the client base, the disruption
arising from the management change has made it difficult to achieve our
previously anticipated sales forecast. We expect activity to improve in the
remainder of the year, but have revised the anticipated profits for this
subsidiary.

Our commercial consultancy businesses have performed well in an extremely
challenging market.  The division continues to benefit from its balanced
portfolio of services. Our professional and property management services
divisions continue to grow at a time when activity in the agency market is
generally low as a result of weaker tenant demand.

In recent years, the group has succeeded in growing its share of the quality
residential management market. The pipeline of confirmed instructions for the
management of buildings under construction is significant.  The decision to move
towards owner occupied buildings and reduce our proportion of traditional ground
rent management, has been justified, especially in view of the challenges that
leaseholder enfranchisement are bringing to freeholder and manager alike. We are
well positioned to grow our residential management businesses and have recently
recruited further experienced management to lead this division.

In spite of the short-term difficulties referred to above your board remains
confident of the company's ability to grow despite these challenging market
conditions.

Interim results will be announced on 17th February 2003.

For further information, please contact:

Hercules Property Services PLC
Rob Plumb, Managing Director        020 8420 7600
Nigel Davis, Finance Director       020 8909 6670

GCI Financial
Roger Leboff / Caroline Massey      020 7072 4200


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