Medicsight PLC

("Medicsight" or "the Group")

Interim Results

for the six months ended 30 June 2009

Medicsight PLC, industry leader in the development of Computer-Aided Detection (CAD) and image analysis software to assist in the early detection and diagnosis of disease, is pleased to announce its interim results for the six months ended 30 June 2009.

Highlights

Allan Rowley, Chief Executive of Medicsight PLC commented: "Medicsight has expanded its product portfolio with the launch of ColonCAD 4.0 and MedicRead 3.0 Colon. Both products have significant improvements over previous versions and have been CE marked for use in Europe. ColonCAD 4.0 has also been approved in Canada. The Group completed a cost reduction program to streamline operating costs and conserve its cash position. Medicsight is well positioned for the second half of 2009 and beyond."

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Chief Executive's Review

I am pleased to report Medicsight's interim results for the six months ended 30 June 2009.

Commercial Partnerships

In June 2009 Medicsight signed a non-exclusive software license and distribution agreement with Alma IT Systems (Alma), for the integration of Medicsight's ColonCAD API 4.0 software into Alma's 3D visualisation workstation. Alma is one of Spain's market leaders in medical imaging technology with a large and well-established installed base of radiology customers. We expect sales to commence before the end of the year.

Product Development & Regulatory Approvals

The Company submitted a 510(k) application to the US Food & Drug Administration (FDA) for ColonCAD 3.1 in November 2008. In December 2008, Medicsight received an Additional Information request letter and, after close collaboration with its FDA advisers, sent a comprehensive response in March 2009. We are currently awaiting feedback from the FDA on the status of our application.

In November 2007 the Company submitted an application for MedicRead 1.0 to the Ministry of Health, Labour and Welfare (MHLW) of Japan. We recently had a meeting with the MHLW authorities, and are in the process of responding to their queries, and await their feedback.

Medicsight's product development program continues on track. In the six months ended 30 June 2009 the Group released ColonCAD 4.0, the most accurate version of the Medicsight ColonCAD to date. The updated software demonstrates a 50% reduction in the number of false positive CAD markings per patient case, whilst maintaining high levels of sensitivity for the detection of colorectal polyps. ColonCAD 4.0 has been granted regulatory approval in Europe (CE marked) and also from the Therapeutic Products Directorate of Health Canada.

The Group also launched MedicRead 3.0 Colon, Medicsight's CAD-enabled CT colonography reviewing tool, which is available online via the Medicsight website (www.medicsight.com). MedicRead 3.0 Colon has been CE marked, and other regulatory approvals are in progress.

As part of a CTC scan examination, the patient's colon has to be distended with gas or air to enable accurate imaging diagnosis. Following market demand, Medicsight has started development of a CO2 insufflation device, MedicCO2lon, for this purpose. The Group is also exploring new image processing and analysis tools for optical colonoscopy. Both of these new applications will bolster the existing CTC portfolio.

Clinical Progress

Doctors Perry Pickhardt and David Kim (from the University of Wisconsin Medical School, in the United States) are undertaking a retrospective comparative analysis of Medicsight's ColonCAD 4.0 performance against the performance of expert radiologists interpreting CTC image data. Early results from this study of more than 3,000 patient datasets show excellent ColonCAD performance and more detailed study results are expected to be presented later in 2009.

Clinical research incorporating Medicsight's ColonCAD was published in the peer-reviewed American Journal of Roentgenology in June 2009. The Group, in collaboration with Dr. Stuart Taylor (of University College Hospital, London) also received notice in July of acceptance of a second peer-reviewed paper for publication in Radiology journal.

Both these studies demonstrate the positive benefit of Medicsight's ColonCAD to radiologists when interpreting CT colonography datasets.

Financial Review

Revenue for the six months ended 30 June 2009 was £67,000 (2008: £44,000).

In line with management's expectations the Group incurred total operating costs of £4,913,000 in the six months to June 30 2009 (2008: £4,892,000). Research and development costs were higher in the period due to a renegotiation of terms with a development partner.

Following the streamlining of business operations and reduction of headcount earlier in the year, Medicsight remains in a strong financial position with cash and cash equivalents of £13,746,000 and expects future operating costs to be significantly lower as we realise the full benefit of the cost reduction program.

Conclusion

With significant financial resources at the Group's disposal Medicsight continues to make progress on all fronts and is well positioned for the second half of 2009 and beyond.

INTERIM FINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENTS

INTERIM FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

INTERIM FINANCIAL STATEMENTS

CONSOLIDATED CASH FLOW STATEMENTS

INTERIM FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

NOTES TO INTERIM FINANCIAL STATEMENTS

1. Basis of preparation of interim financial information

These interim consolidated financial statements are for the six months ended 30 June 2009. The interim financial report, which is unaudited, has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards and IFRIC interpretations adopted for use in the European Union (IFRS). The accounting policies and methods of computation used are consistent with those used in the Group annual report for the year ended 31 December 2008 and are expected to be used in the Group Annual Report for the year ended 31 December 2009. The six month period figures have not been audited.

The financial information for the year ended 31 December 2008 does not constitute statutory information. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors' report on these accounts was not qualified and did not contain statements under section 237(2) and (3) of the Companies Act 1985.

The interim consolidated financial statements are presented in pounds sterling because that is the currency of the primary economic environment in which the group operates. All values are rounded to the nearest thousand pounds (£000) except when otherwise stated.

NOTES TO INTERIM FINANCIAL STATEMENTS

2. Segmental geographical reporting

The Group operates in one business area which is the development and commercialisation of medical imaging software.

Operating results are reported to the Group's chief operating decision maker on a geographical basis. The following reports financial information on a geographical basis and reconciles it to the Group's results.

NOTES TO INTERIM FINANCIAL STATEMENTS

3. Earnings per share

The loss per share is based on the weighted average number of ordinary shares in issue during the year. The Group has recorded a loss in all periods. No adjustment has been made to the basic loss per share, as the exercise of the share options would have the effect of reducing the loss per ordinary share and is anti-dilutive.

4. Share options

The Group has granted share options to eligible employees since 2003.

A summary of the movement on the Group's share option plans is:

NOTES TO INTERIM FINANCIAL STATEMENTS

The following data are a summary of the status of the share options outstanding at 30 June 2009:

On 14 May 2009 the Group offered employees the opportunity to forfeit their existing share option plans and, in their place, received 50% of the number of forfeited options in a new share option plan J. The options in the new plan have an exercise price of 8.5p and one sixth of the options vest every six months for three years. Under IFRS 2, the cancellation of existing options and the issue of replacement options are accounted for as modifications of the original options. 4,816,250 options were issued in plan J as replacements for cancelled options and a further 3,032,500 new options were issued.

The grant date fair value of plan J was £875,000, of which £35,000 related to the modification charge. The expense relating to the modification will be expensed over three years; the expense relating to the cancelled options will be expensed over the period of the original plans.

On 20 May 2009 the Group created a new share option plan K. 300,000 options were issued at an exercise price of 10p. Options under this plan, vest in equal one thirds on 30 June, 30 September, and 31 December 2009.

The grant date fair value of plan K was £20,000, which will be recognised in the period from 20 May 2009 to 31 December 2009.

Options are fair valued using the Black-Scholes option pricing model. No performance conditions were included in the fair value calculations. The following weighted average assumptions were used to estimate the fair value of stock options granted in the period:

Expected volatility is based on historical volatility over the last three years of MGT Capital Investments, Inc (the parent company). The expected life is the average expected period to exercise. The risk free rate of return is the yield on zero-coupon UK government bonds of a term consistent with the assumed option life.

NOTES TO INTERIM FINANCIAL STATEMENTS

In the period ending 30 June 2009 the Group recorded a share option charge of £359,000 (30 June 2008: £617,000).

5. Related Parties

The Group has related party relationships with its subsidiaries, its parent company (MGT Capital Investments, Inc.), directors, employees and subsidiary companies of its parent Group.

Other subsidiary companies of the parent also operate from 66 Hammersmith Road, London and some establishment, finance, IT and administration costs are charged to, and from, these companies. In the six months to 30 June 2009 Beijing Medicexchange China Co. Limited and MGT Capital Investments (UK) Limited charged the Group £152,000 and £384,000 respectively. In this period the Group charged MGT Capital Investments (UK) Limited £13,000.

6. Reconciliation of net cash flows from operating activities