UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-QSB/A

                                (Amendment No 1)

                                   (Mark One)


          [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

                      For the quarter ended March 31, 2003

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

          For the transition period from _____________ to ____________

                         Commission file number 0-32013

                              SPEAR & JACKSON, INC.
                    ----------------------------------------
             (Exact name of registrant as specified in its charter)


Nevada                                                     91-2037081
----------                                              ---------------
(State of other jurisdiction of                         (I.R.S. Employer
incorporation or organisation)                       Identification Number)

2200 Corporate Boulevard, Suite 314
Boca Raton, Florida                                       33431
------------------------------------------------        --------
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code: 561-999-9011

        Securities registered pursuant to Section 12(b) of the Act: None

           Securities registered pursuant to Section 12(g) of the Act:
                     Common Stock, par value $.001 per share

Indicate by checkmark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such report(s), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

Registrant had 12,011,122 shares of Common Stock, $.001 par value per share,
outstanding as of April 30, 2003.


<PAGE>

EXPLANATORY NOTE

On January 13, 2003, Spear & Jackson Inc. ("the Company") filed its annual
report on Form 10-KSB for the fiscal year ended September 30, 2002. On May 28,
2003 the Company filed Amendment No. 1 to the Annual Report on Form 10-KSB for
the fiscal year ended September 30, 2002. The amendment restated the original
Form 10-KSB in order to re-present the acquisition of Spear & Jackson plc and
Bowers Group plc by Megapro Tools, Inc. as a reverse takeover. The impact of
this restatement of the basis of consolidation was reflected in the quarterly
report on form 10-QSB for the three and six month periods ended March 31, 2003
and March 31, 2002 which was filed on May 9, 2003.

Amendment No. 2 to the Annual Report on Form 10-KSB for the year ended September
30, 2002 was filed on December 30, 2003 in order to amend and restate the
consolidated financial statements for both the year ended September 30, 2002 and
the year ended September 30, 2001. Adjustments that impacted the Consolidated
Statement of Operations, the Consolidated Balance Sheet and the Consolidated
Statement of Changes in Shareholders' Equity for the year ended September 30,
2002 also affected the previously filed forms 10-QSB and 10-QSB/A for the
quarters ended December 31, 2002, March 31, 2003 and June 30, 2003. These
quarterly returns have accordingly been restated.

This Amendment No. 1 to the Quarterly Return on Form 10-QSB for the quarter
ended March 31, 2003, is therefore being filed to restate the financial
statements and supplemental disclosures as follows:

PART I
Item 1 - Financial Statements

1.       The presentation of the Company's UK defined benefit pension plan has
         been restated. The adjustments required arose from errors and omissions
         in the calculations that were prepared by the Company's actuaries when
         producing the pension plan disclosures that were originally included in
         Amendment 1 to Form 10-KSB for the year ended 30 September 30, 2002.
         The errors and omissions comprised:

a)                Overstatements in the calculation of the market related value
                  of assets, which meant that additional unrecognized actuarial
                  losses should have been amortized in the consolidated income
                  statement for the years ended September 30, 2002 and September
                  30, 2001.


b)                At September 30, 2002, no comparison of the fair value of plan
                  assets to the accumulated benefit obligation ("ABO") was
                  performed. Consequently a pension prepayment was incorrectly
                  recognized in the consolidated balance sheet despite the ABO
                  being in excess of the fair value of plan assets. The 2002
                  consolidated balance sheet was therefore amended to properly
                  record an additional minimum pension liability equivalent to
                  the shortfall of plan assets compared to the plan's ABO.

c)                The pension disclosures at September 30, 2001 were also
                  reconsidered and an additional minimum pension liability was
                  recognized in respect of that year also.

Item (a) impacted the previously reported figure for Selling, General and
Administrative expenses ("SG&A") and also the tax charge for the year. Item (b)
resulted in the previously disclosed pension asset of $14,962 being presented as
a pension liability of $20,442 with corresponding debit entries being made to
deferred taxation of $10,621 and to the "Other Comprehensive Income (Loss)"
caption within shareholders' equity of $24,343. The 2001 ABO pension
adjustments, item (c), were reflected in the consolidated statement of changes
in shareholders' equity for the year ended September 30, 2001. They also
affected the SFAS 87 charges for 2002 and subsequent years.

                                       2

<PAGE>

These adjustments also impact on the previously submitted financial statements
for the three and six month periods ended March 31, 2003 as follows. Item (a)
reduced the figure for retained profits brought forward at October 1, 2002, as
originally stated, by $440 with $628 being credited to the pension liability and
$188 debited to the deferred tax asset. Items (b) and (c) resulted in the
previously disclosed pension asset of $16,654 being presented as a pension
liability of $19,098 with corresponding debit entries being made to deferred
taxation of $10,537 and to the "Other Comprehensive Income (Loss)" caption
within shareholders' equity of $24,585.

2.       The fair value of the consideration for the deemed acquisition of
         Megapro Tools, Inc. was revised. This resulted in goodwill of $1,138
         being recognized which was then written off following a goodwill
         impairment review. With regard to the financial statements for the
         three months ended December 31, 2002, retained profits brought forward
         at October 1, 2002 were correspondingly reduced by this amount.

3.       Sales rebates totalling $915 in the three months ended March 31, 2003
         and $756 in the three months ended March 31, 2002 and rebates of $1,729
         in the six months ended March 31, 2003 and $1,458 in the six months
         ended March 31, 2002, which were previously presented as a component of
         SG&A expense, have been reanalysed and are now shown as a reduction to
         sales.

4.       Expanded disclosures were included in "Other Comprehensive Income" in
         respect of unrealized gains and losses on derivative instruments to
         provide the quantified disclosures required by paragraphs 45-47 of SFAS
         133.

5.       Additional detailed segmental analysis disclosure.

6.       Additional contingencies disclosure. This has been done to supplement
         the original presentation and to ensure consistency with the footnote
         incorporated in the financial statements for the year ended September
         30, 2002 which were included in Form 10-KSB/A (Amendment No 2) which
         was filed on December 29, 2003.

In addition to the above, following the disposal of the Company's Megapro
screwdriver division in September 2003, the results of that business were
re-classified as discontinued operations in the Company's Consolidated Statement
of Operations for the year ended September 30, 2003. The Consolidated Statements
of Operations for the quarters ended December 31, 2002, March 31, 2003 and June
30, 2003 have also been revised to incorporate a similar re-classification of
operations.

PART I
Item 2 - Management's Discussion and Analysis or Plan of Operation

Management's Discussion and Analysis or Plan of Operation has been extended to
include:
(a)  a discussion of critical accounting policies;
(b)  additional   narrative   concerning  the  disposal  of  the  Megapro
     Screwdriver   division  and  its presentation as a discontinued operation
     in the financial statements attached hereto.

PART II
Item 1

(a) additional contingencies discussion

The remaining disclosures contained within this Amendment consist of all other
disclosures originally contained in the Company's Quarterly Report on Form
10-QSB for the quarter ended March 31, 2003 in the form filed with the
Securities and Exchange Commission ("SEC") on May 9, 2003.

Other disclosures as originally included in the Company's Quarterly Report on
Form 10-QSB for the three months ended March 31, 2003 are not amended hereby,
but are included for the convenience of the reader.

In order to preserve the nature and character of the disclosures set forth in
the Company's Quarterly Report on Form 10-QSB for the quarter ended March 31,
2003, as originally filed, except as expressly noted herein, this report speaks
as of the date of the original filing, and we have not updated the disclosures
in this report to speak as of a later date.

                                       3

<PAGE>

Therefore, while this report primarily relates to the historical periods
covered, events may have taken place since the original filing that might have
been reflected in this report if they had taken place prior to the original
filing. All information contained in this Amendment No. 1 is subject to updating
and supplementing as provided in our reports filed with the Securities and
Exchange Commission subsequent to the date of the original filing of the
Quarterly Report on Form 10-QSB for the quarter ended March 31, 2003.

















                                       4

<PAGE>



                              Spear & Jackson, Inc.


                                      INDEX



PART I.    FINANCIAL INFORMATION
                                                                     Page Number
Item 1     Financial Statements (Unaudited)

           Consolidated Balance Sheet March 31, 2003                     F-1

           Consolidated Statements of Operations - Three
           and Six Months ended March 31, 2003 and 2002                  F-2

           Consolidated Statements of Comprehensive Income (Loss) -
           Three and Six Months ended March 31, 2003 and 2002            F-3

           Consolidated Statements of Cash Flows - Six Months
           ended March 31, 2003 and 2002                                 F-4

           Notes to Consolidated Financial Statements                    F-5

Item 2     Management's Discussion and Analysis or
           Plan of Operation                                              6

Item 3     Controls and Procedures                                       17

PART II    OTHER INFORMATION                                             17

Item 1     Legal Proceedings

Item 2     Changes in Securities and Use of Proceeds                     17

Item 3     Defaults Upon Senior Securities                               17

Item 4     Submission of Matters to a Vote of Security Holders           17

Item 5     Other Information                                             17

Item 6     Exhibits and Reports on Form 8-K                              18

SIGNATURES






                                       5

<PAGE>

                              SPEAR & JACKSON, INC.

                           CONSOLIDATED BALANCE SHEET
                                   (Unaudited)
                                 (in thousands)

                                                                 At March 31,
                                                                     2003
                                                               ---------------
                                                                 (Restated)
                       ASSETS
Current assets:
 Cash and cash equivalents                                     $        7,330
 Trade receivables, net                                                18,189
 Inventories                                                           23,985
 Other current assets                                                   1,105
                                                               ---------------
Total current assets                                                   50,609

Property, plant and equipment, net                                     19,598
Deferred taxation                                                       9,116
Investments                                                               140
                                                               ---------------
Total assets                                                   $       79,463
                                                               ===============


                         LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
 Notes payable                                                 $          239
 Short term debt                                                            9
 Trade accounts payable                                                11,403
 Accrued expenses and other liabilities                                13,789
 Director's loan payable                                                  100
 Foreign taxes payable                                                     56
                                                               ---------------
Total current liabilities                                              25,596
Long term debt                                                             10
Other liabilities                                                       1,826
Pension liability                                                      19,098

                                                               ---------------
Total liabilities                                                      46,530
                                                               ---------------
Stockholders' equity:
 Common stock                                                              12
 Additional paid in capital                                            51,590
 Accumulated other comprehensive income:
  Pension additional minimum liability                                (24,585)
  Foreign currency translation adjustment                               4,284
  Unrealized losses on derivative instruments                             (10)
 Retained earnings                                                      1,642

                                                               ---------------
                                                                       32,933
                                                               ---------------

Total stockholders' equity                                     $       79,463
                                                               ===============



   The accompanying notes are an integral part of these financial statements.


                                       F-1

<PAGE>

                              SPEAR & JACKSON, INC.


                      CONSOLIDATED STATEMENTS OF OPERATIONS


                                   (Unaudited)


                                 (in thousands)

<TABLE>
<CAPTION>

                                                For the Three Months Ended           For the Six Months Ended
                                                   March 31,        March 31,          March 31,        March 31,
                                                    2003             2002              2003              2002
                                              ----------------- ----------------  ---------------- -----------------
                                                  (Restated)       (Restated)        (Restated)       (Restated)
<S>                                           <C>               <C>               <C>              <C>
Net sales                                     $     25,034      $    22,111       $    47,220      $     42,628
Cost of goods sold                                  16,840           15,447            32,090            30,333
                                              ----------------- ----------------  ---------------- -----------------
Gross profit                                         8,194            6,664            15,130            12,295

Operating costs and expenses:
Selling, general and administrative expenses         6,162            5,948            11,542            11,884
                                              ----------------- ----------------  ---------------- -----------------
Operating income                                     2,032              716             3,588               411

Other income (expense)
Royalties                                             -                -                   12              -
Rental income                                           37               31                70                61
Interest and bank charges (net)                        (57)             (97)              (89)             (185)
                                               ---------------- ----------------  ---------------- -----------------

Income from continuing operations
 before income taxes                                 2,012              650             3,581               287
Provision for income taxes                            (573)            (254)             (959)             (195)
                                               ---------------- ----------------  ---------------- -----------------

Income from continuing operations                    1,439              396             2,622                92
                                               ---------------- ----------------  ---------------- -----------------

Discontinued operations:

Income from operations of Megapro
 screwdriver division (including taxation
 of $0)                                                  5             -                   33              -
                                               --------------- -----------------  ---------------- -----------------
Income from discontinued operations                      5             -                   33              -
                                               --------------- -----------------  ---------------- -----------------

Net income                                    $      1,444      $       396       $     2,655      $         92
                                               =============== =================  ================ =================

Basic and diluted earnings per share:

From continuing operations                           $0.12            $0.11             $0.22             $0.03

From discontinued operations                          0.00             0.00              0.00              0.00
                                               --------------- -----------------  ---------------- -----------------
Total                                                $0.12            $0.11             $0.22             $0.03
                                               =============== =================  ================ =================

Weighted average shares outstanding             12,011,122        3,543,281        12,011,122         3,543,281
                                               =============== =================  ================ =================

</TABLE>


   The accompanying notes are an integral part of these financial statements.

                                       F-2


<PAGE>

                              SPEAR & JACKSON, INC.


             CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)


                                   (Unaudited)


                                 (in thousands)


<TABLE>
<CAPTION>
                                                  For the Three    For the Three       For the Six       For the Six
                                                  Months Ended      Months Ended       Months Ended     Months Ended
                                                    March 31,        March 31,          March 31,         March 31,
                                                      2003              2002               2003             2002
                                                  --------------   ---------------    ---------------   --------------
                                                    (Restated)      (Restated)            (Restated)      (Restated)

<S>                                                <C>              <C>                 <C>               <C>
Total net income                                   $      1,444     $        396        $      2,655      $        92

Other comprehensive income (loss)

 Additional minimum pension liability                       652              182                (242)             347
 Foreign currency translation adjustments                  (711)            (916)              1,228           (1,746)
 Unrealized losses on derivative instruments                 (3)              (4)                (12)             (76)

                                                  --------------   ---------------    ---------------   --------------
Total comprehensive income (loss)                  $      1,382     $       (342)       $      3,629      $    (1,383)
                                                  ==============   ===============    ===============   ==============

</TABLE>



   The accompanying notes are an integral part of these financial statements.

                                       F-3

<PAGE>

                              SPEAR & JACKSON, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)
<TABLE>
<CAPTION>

                                                                                 For the Six Months Ended
                                                                                 March 31,         March 31,
                                                                                    2003              2002
                                                                              ----------------- -----------------
                                                                                   (Restated)         (Restated)

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                            <C>                <C>
Net income                                                                     $        2,655     $          92
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation                                                                            1,431             1,407
Profit on sale of plant, property and equipment                                          (173)             -
Deferred income taxes                                                                     938               195
Changes in operating assets and liabilities, excluding the effects
of acquisitions and dispositions:
Increase in trade receivables                                                            (115)           (1,382)
Increase in inventories                                                                (3,285)           (1,079)
Decrease in other current assets                                                          178               748
Contributions paid to pension plan                                                     (1,414)           (1,579)
(Decrease) increase in other non-current liabilities                                      (94)               37
Increase in trade accounts payable                                                      2,624             2,087
Increase in accrued expenses and other liabilities                                        644               352
Increase (decrease) in foreign taxes payable                                               17               (51)
Increase (decrease) in other liabilities                                                  947               (47)
                                                                             ----------------- -----------------
NET CASH  PROVIDED BY  OPERATING ACTIVITIES                                             4,353               780
                                                                             ----------------- -----------------

INVESTING ACTIVITIES:
Purchases of property, plant and equipment                                             (2,611)             (217)
Proceeds from sale of property, plant and equipment                                       170                 -
                                                                              ----------------- -----------------

NET CASH USED IN INVESTING ACTIVITIES                                                  (2,441)             (217)
                                                                              ----------------- -----------------

FINANCING ACTIVITIES:
Repayment of long-term debt                                                                (4)             -
Repayment of in  overdraft                                                             (1,004)             -
Overdraft advances                                                                          -               324
Repayment of shareholder loan                                                             (60)             -
                                                                              ----------------- -----------------
NET CASH  (USED IN) PROVIDED BY FINANCING ACTIVITIES                                   (1,068)              324
                                                                              ----------------- -----------------

Effect of exchange rate changes on cash and cash equivalents                             -                 (226)
                                                                              ----------------- -----------------

CHANGE IN CASH AND CASH EQUIVALENTS                                                       844               661

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                        6,486             2,710
                                                                              ----------------- -----------------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                     $        7,330     $       3,371
                                                                              ================= =================

SUPPLEMENTAL CASH FLOW INFORMATION
    Cash paid for interest                                                     $            5     $         132
                                                                              ================= =================
    Cash paid for taxes                                                        $            4     $          51
                                                                              ================= =================



</TABLE>


   The accompanying notes are an integral part of these financial statements.

                                       F-4

<PAGE>

                              SPEAR & JACKSON, INC.


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                          (in thousands except shares)

Note 1--Basis of Presentation

     These consolidated  financial  statements are expressed in U.S. dollars and
have been prepared in accordance with accounting  principles  generally accepted
in the United States. The consolidated financial statements include the accounts
of Spear & Jackson Inc.  (the Company) and its wholly owned  subsidiaries,  Mega
Tools Ltd.,  Mega Tools USA,  Inc.,  Megapro  Tools,  Inc., S and J  Acquisition
Corp.,  Spear & Jackson plc and Bowers  Group plc.  Both Spear & Jackson plc and
Bowers Group plc are sub-holding  companies and their business is carried out by
the following  directly and  indirectly  owned  subsidiaries:  Bowers  Metrology
Limited,  Bowers  Metrology UK Limited,  Coventry Gauge Limited,  CV Instruments
Limited, Eclipse Magnetics Limited, Spear & Jackson (New Zealand) Limited, James
Neill Canada Inc., James Neill Holdings Limited,  James Neill U.S.A. Inc., Spear
& Jackson (Australia) Pty Ltd., Magnacut Limited,  Neill Tools Limited,  Spear &
Jackson Garden  Products  Limited,  Spear & Jackson  Holdings  Limited,  Spear &
Jackson France S.A. and Societe Neill France S.A.

As further  explained in note 4, below,  the purchase of Spear & Jackson plc and
Bowers Group plc by Megapro  Tools,  Inc. (now Spear & Jackson,  Inc.) which was
completed on September 6, 2002 was treated as a reverse acquisition.

All significant intercompany accounts and transactions have been eliminated on
consolidation.

The accompanying unaudited condensed financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
statements pursuant to both the rules and regulations of the Securities and
Exchange Commission and with instructions to Form 10-QSB. Accordingly, certain
information and footnote disclosures required for annual financial statements
have been condensed or omitted. The Company's management believes that all
adjustments necessary to present fairly the Company's financial position as of
March 31, 2003, and the results of operations for the three and six month
periods ended March 31, 2003 and March 31, 2002 and cash flows for the six month
periods ended March 31, 2003 and March 31, 2002 have been included and that the
disclosures are adequate to make the information presented not misleading

It is suggested that these financial statements be read in conjunction with the
audited consolidated financial statements and related footnotes of the Company
for the period ended September 30, 2002 included in the Company's amended annual
report filed on Form 10-KSB/A for the period then ended.

The consolidated financial statements of Spear & Jackson, Inc. are denominated
in US dollars. Changes in exchange rates between UK sterling and the US dollar
will affect the translation of the UK subsidiaries' financial results into US
dollars for the purposes of reporting the consolidated financial results. The
process by which each foreign subsidiary's financial results are translated into
US dollars is as follows: income statement accounts are translated at average
exchange rates for the period; balance sheet asset and liability accounts are
translated at end of period exchange rates; and equity accounts are translated
at historical exchange rates. Translation of the balance sheet in this manner
affects the stockholders' equity account, referred to as the accumulated other
comprehensive loss account. Management have decided not to hedge against the
impact of exposures giving rise to these translation adjustments as such hedges
may impact upon the Company's cash flow compared to the translation adjustments
which do not affect cash flow in the medium term.

The results of operations for the three and six month periods ended March 31,
2003 are not necessarily indicative of the results to be expected for the full
year.

Certain reclassifications have been made to prior period amounts to conform to
current period presentation.


The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.


                                       F-5

<PAGE>

                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)


Note 2 - Recently Issued Accounting Standards

SFAS No. 145, Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB
Statement No. 13, and Technical Corrections was issued April 2002. This
Statement rescinds FASB Statement No. 4, Reporting Gains and Losses from
Extinguishment of Debt, and an amendment of that Statement, FASB Statement No.
64, Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements. This
Statement also rescinds FASB Statement No. 44, Accounting for Intangible Assets
of Motor Carriers. This Statement amends FASB Statement No. 13, Accounting for
Leases, to eliminate an inconsistency between the required accounting for
sale-leaseback transactions and the required accounting for certain lease
modifications that have economic effects that are similar to sale-leaseback
transactions. This Statement also amends other existing authoritative
pronouncements to make various technical corrections, clarify meanings, or
describe their applicability under changed conditions. The provisions of this
Statement related to the rescission of Statement 4 shall be applied in fiscal
years beginning after May 15, 2002. The provisions in paragraph 8 and 9(c) of
this Statement related to Statement 13 shall be effective for transactions
occurring after May 15, 2002. All other provisions of this Statement shall be
effective for financial statements issued on or after May 15, 2002. The effects
of implementation are not material.

SFAS No. 146 Accounting for Costs Associated with Exit or Disposal Activities
was issued June 2002. This Statement addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force (EITF) Issue No. 94-3, Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring). The provisions of this
Statement are effective for exit and disposal activities that are initiated
after December 31, 2002.

In September 2002, the FASB issued SFAS No. 147, Acquisition of Certain
Financial Institutions. SFAS No. 147 changed the special accounting for
unidentifiable intangible assets recognised under SFAS No. 72. Transition
provisions for previously recognized unidentifiable intangible assets were
effective on October 1, 2002. The effects of implementation had no impact on the
Company's consolidated financial statements.


Note 3 - Critical Accounting Policies

         A summary of significant accounting policies is included in Note 2 to
the audited consolidated financial statements included in the Company's Annual
Report on Form 10-KSB/A for the year ended September 30, 2002. Management
believes that the application of these policies on a consistent basis enables
the Company to provide useful and reliable financial information about the
Company's operating results and financial condition.

         As disclosed in the annual report on Form 10-KSB for the fiscal year
ended September 30, 2002, the discussion and analysis of our financial condition
and results of operations are based upon our consolidated financial statements.
These have been prepared in conformity with accounting principles generally
accepted in the United States. The preparation of the financial statements
requires us to make estimates and assumptions that affect the reported amounts
of assets, liabilities, revenues and expenses as disclosed in those financial
statements. These judgements can be subjective and complex, and consequently
actual results could differ from those estimates. Our most critical accounting
policies relate to revenue recognition; foreign exchange risk; inventory and
pension and other post-retirement benefit costs. Since September 30, 2002, there
have been no changes in our critical accounting policies and no significant
changes to the assumptions and estimates related to them.

                                       F-6

<PAGE>

                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)



Note 4 - Nature of Business

         The Company was incorporated in the State of Nevada on December 17,
1998 and was inactive until the acquisition of Mega Tools Ltd. and Mega Tools
USA, Inc. via reverse acquisition on September 30, 1999. The Company is engaged
in the manufacture and sale of a patented multi-bit screwdriver.

         The Company entered into an exclusive North American license agreement
with the patent holder of a retracting cartridge type screwdriver. This license
agreement gave the Company unrestricted use of the patent in Canada and the
United States until November 8, 2005. The Company's wholly owned subsidiaries,
Mega Tools USA, Inc. and Mega Tools Ltd. manufactured and marketed the drivers
to customers in the United States and Canada. With effect from September 30,
2003 the Company exited its screwdriver operations following the sale of the
trade and net assets of Mega Tools USA, Inc. and Mega Tools Ltd.

         On September 6, 2002 the Company acquired the entire issued share
capital of Spear & Jackson plc and Bowers Group plc. These companies through
their principal operating entities, as disclosed in note 1, manufacture and
distribute a broad line of hand tools, lawn and garden tools, industrial magnets
and metrology tools primarily in the United Kingdom, Europe, Australia, North
and South America, Asia and the Far East.

         Having considered the relative sizes of the businesses involved in the
combination and other factors, the acquisition of Spear & Jackson plc and Bowers
Group plc ("S&J") by Megapro Tools, Inc. was accounted for as a reverse
acquisition for financial reporting purposes. The reverse acquisition is deemed
a capital transaction and the net assets of S&J (the accounting acquirer) were
carried forward to Megapro Tools, Inc. (the legal acquirer and the reporting
entity) at their carrying value before the combination. Although S&J was deemed
to be the acquiring corporation for financial accounting and reporting purposes,
the legal status of Megapro Tools, Inc. as the surviving corporation does not
change. The relevant acquisition process utilizes the capital structure of
Megapro Tools, Inc. and the assets and liabilities of S&J are recorded at
historical cost.

          In these financial statements, S&J is the operating entity for
financial reporting purposes and the financial statements for all periods
presented represent S&J's financial position and results of operations. The
equity of Megapro Tools Inc. is the historical equity of S&J retroactively
restated to reflect the number of shares issued in the S&J acquisition.

         On 7 November 2002 the Company changed its name from Megapro Tools,
Inc. to Spear & Jackson, Inc.

                                      F-7

<PAGE>

Note 5 - Segment Data

         The Company's principal operations relate to the manufacture and
distribution of a broad line of hand tools, lawn and garden tools, industrial
magnets and metrology tools. These operations are conducted through business
divisions located primarily in the United Kingdom, France, USA and Australasia.

         Given below are summaries of the significant accounts and balances by
business segment and by geographical location, reconciled to the consolidated
totals. In both periods, transactions and balances applicable to the Company's
distribution companies in France, Australia and New Zealand have been aggregated
with the hand and garden product businesses since these products represent the
most significant proportion of the distribution companies' trades. The summaries
also provide an analysis of the accounts and balances between continuing and
discontinued operations.

         The financial information of the segments is regularly evaluated by the
corporate operating executives in determining resource allocation and assessing
performance and is periodically reviewed by the Company's Board of Directors.
The Company's senior management evaluates the performance of each business
segment based on its operating results and, other than general corporate
expenses, allocates specific corporate overhead to each segment. Accounting
policies for the segments are the same as those for the Company.

                                       F-8

<PAGE>

                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)


Note 5--Segment Data - continued

         The following is a summary of the significant accounts and balances (in
thousands) by business segment, reconciled to the consolidated totals.
<TABLE>
<CAPTION>

                                Sales          Long-lived Assets (a)           Sales                Long-lived Assets (a)
                        ---------------------  -----------------------  ------------------------  -----------------------
                          Three Months Ended     Three Months Ended        Six Months Ended          Six Months Ended
                        March 31,   March 31,  March 31,   March 31,    March 31,    March 31,    March 31,   March 31,
                           2003       2002        2003        2002         2003        2002          2003        2002
                        --------- -----------  ----------- -----------  ----------- ------------  ----------- -----------

<S>                     <C>       <C>          <C>         <C>           <C>        <C>           <C>         <C>
  Hand & garden tools   $ 19,328  $   16,783   $    6,922  $    9,363    $  36,025  $    31,549   $    6,922  $    9,363
  Metrology tools          3,587       3,394        2,674       2,321        6,914        6,996        2,674       2,321
  Magnetic products        2,119       1,934        1,068         998        4,281        4,083        1,068         998
  Screwdrivers               271        -             163           -          606         -             163        -
  Corporate                 -                       8,771       8,165         -            -           8,771       8,165
                        --------- -----------  ----------- -----------  ----------- ------------  ----------- -----------
     Total              $ 25,305  $   22,111   $   19,598  $   20,847   $   47,826  $    42,628   $   19,598  $   20,847
                        ========= ===========  =========== ===========  =========== ============  =========== ===========

Attributable to:
Continuing operations   $ 25,034  $   22,111   $   19,435  $   20,847   $   47,220  $    42,628   $   19,435  $   20,847
Discontinued operations      271        -             163        -             606         -             163        -
                        --------- -----------  ----------- -----------  ----------- ------------  ----------- -----------
                        $ 25,305  $   22,111   $   19,598  $   20,847   $   47,826  $    42,628   $   19,598  $   20,847
                        ========= ===========  =========== ===========  =========== ============  =========== ===========

                              Depreciation       Capital expenditure          Depreciation          Capital expenditure
                        ---------------------  -----------------------  ------------------------  -----------------------
                          Three Months Ended     Three Months Ended        Six Months Ended          Six Months Ended
                        March 31,   March 31,  March 31,   March 31,    March 31,    March 31,     March 31,   March 31,
                           2003       2002        2003        2002         2003        2002          2003        2002
                        ---------  ----------  ----------- -----------  ----------- ------------  ----------- -----------

  Hand & garden tools   $    474   $     484   $    1,515  $       29   $      960  $       986   $    1,680  $      183
  Metrology tools             95          97          525           4          196          203          543           4
  Magnetic products           93          58          333          30          155          124          333          30
  Screwdrivers                22           -         -          -               24        -            -           -
  Corporate                   47          47           55       -               96           94           55       -
                        ---------  ----------  ----------- -----------  ----------- ------------  ----------- -----------
     Total              $    731   $     686   $    2,428  $       63   $    1,431  $     1,407   $    2,611  $      217
                        =========  ==========  =========== ===========  =========== ============  =========== ===========

Attributable to:
Continuing operations   $    709   $     686   $    2,428  $       63   $    1,407  $     1,407   $    2,611  $      217
Discontinued operations       22        -            -          -               24         -            -          -
                        ---------  ----------  ----------- -----------  ----------- ------------  ----------- -----------
                        $    731   $     686   $    2,428  $       63   $    1,431  $     1,407   $    2,611  $      217
                        =========  ==========  =========== ===========  =========== ============  =========== ===========

                           Operating Income    Net Interest                Operating Income            Net Interest
                        ---------------------  ------------------------ ------------------------  -----------------------
                          Three Months Ended     Three Months Ended        Six Months Ended          Six Months Ended
                        March 31,   March 31,  March 31,   March 31,      March 31,    March 31,    March 31,   March 31,
                           2003       2002        2003        2002         2003        2002          2003        2002
                        ---------  ----------  ------------ ----------- ----------- ------------  ----------- -----------

  Hand & garden tools   $  1,566   $     663   $      (81)  $    (122)  $    2,669  $       474   $     (111)  $    (181)
  Metrology tools            351         216         -             (2)         649          505           (5)         (5)
  Magnetic products          364         145           (3)         (1)         710          (33)          (5)         (3)
  Screwdrivers                11        -              (6)       -              46         -              (2)       -
  Corporate                 (249)       (308)          27          28         (440)        (535)          21           4
                        ---------  ----------  ----------- -----------  ----------- ------------  ----------- -----------
     Total              $  2,043   $     716   $      (63) $      (97)  $    3,634  $       411   $     (102) $     (185)
                        =========  ==========  =========== ===========  =========== ============  =========== ===========
Attributable to:
Continuing operations   $  2,032   $     716   $      (57) $      (97)  $    3,588  $       411   $      (89) $     (185)
Discontinued operations       11        -              (6)       -              46         -             (13)      -
                        ---------  ----------  ----------- -----------  ----------- ------------  ----------- -----------
                        $  2,043   $     716   $      (63) $      (97)  $    3,634  $       411   $     (102) $     (185)
                        =========  ==========  =========== ===========  =========== ============  =========== ===========

</TABLE>

(a) Represents property, plant and equipment, net.

                                       F-8

<PAGE>

                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)

Note 5 - Segment Data - continued

The following table presents certain data by geographic areas (in thousands):

<TABLE>
<CAPTION>

                            Sales (a)           Long-lived Assets (b)            Sales (a)         Long-lived Assets (b)
                        ---------------------  -----------------------  ------------------------  -----------------------
                           Three Months Ended       Three Months Ended      Six Months Ended          Six Months Ended
                          March 31  March 31    March 31,   March 31,     March 31   March 31      March 31,   March 31,
                          2003        2002         2003       2002          2003       2002         2003        2002
                        ---------  ----------  ----------- -----------  ----------- ------------  ----------- -----------
<S>                     <C>        <C>         <C>         <C>          <C>         <C>           <C>         <C>
   United Kingdom       $ 12,885   $  13,624   $   17,553  $   19,509   $   23,528  $    23,743   $   17,553  $   19,509
  Europe                   4,384       1,868        1,196       1,059        8,294        5,470        1,196       1,059
  Australasia              4,598       3,514          678         279        9,736        7,439          678         279
  North America            2,412       2,301          171        -           4,309        4,024          171        -
  Other                    1,026         804         -           -           1,959        1,952         -           -
                        ---------  ----------  ----------- -----------  ----------- ------------  ----------- -----------
     Total              $ 25,305   $  22,111   $   19,598  $   20,847   $   47,826  $    42,628   $   19,598  $   20,847
                        =========  ==========  =========== ===========  =========== ===========   =========== ===========
Attributable to:
Continuing operations   $ 25,034   $  22,111   $   19,435  $   20,847   $   47,220  $   42,628    $   19,435  $   20,847
Discontinued operations      271        -             163        -             606        -              163        -
                        ---------  ----------  ----------- -----------  ----------- -----------   ----------- -----------
                        $ 25,305   $  22,111   $   19,598  $   20,847   $   47,826  $   42,628    $   19,598  $   20,847
                        =========  ==========  =========== ===========  =========== ===========   =========== ===========

                        Depreciation             Capital expenditure            Depreciation        Capital expenditure
                        ---------------------  -----------------------  -----------------------------------------------
                           Three Months Ended       Three Months Ended          Six Months Ended        Six Months Ended
                        March 31    March 31      March 31,  March 31,      March 31   March 31    March 31,   March 31,
                          2003        2002          2003       2002           2003       2002         2003        2002
                        ---------  ----------  ----------- -----------  -----------------------  ------------ -----------
  United Kingdom        $    632   $     632   $    2,085  $       54   $    1,251  $    1,287   $     2,121  $      206
  Europe                      42           4         -              4           57          14             3           4
  Australasia                 56          50          343           5          121         106           477           7
  North America                1        -                                        2        -               10        -
                        ---------  ----------  ----------- -----------   ---------- -----------  ------------ -----------
     Total              $    731   $     686   $    2,428  $       63    $   1,431  $    1,407   $     2,611  $      217
                        =========  ==========  =========== ===========   ========== ===========  ============ ===========
Attributable to:
Continuing operations   $    709   $     686   $    2,428  $       63    $   1,407  $    1,407   $     2,611  $      217
Discontinued operations       22        -            -           -              24        -             -           -
                        ---------  ----------  ----------- -----------   ---------- -----------  ------------ -----------
                        $    731   $     686   $    2,428  $       63    $   1,431  $    1,407   $     2,611  $      217
                        =========  ==========  =========== ===========   ========== ===========  ============ ===========

                            Operating income     Net Interest                Operating income     Net Interest
                        ----------------------------------------------   ------------------------------------------------
                           Three Months Ended       Three Months Ended        Six Months Ended        Six Months Ended
                        March 31    March 31      March 31,  March 31,      March 31   March 31    March 31,   March 31,
                          2003        2002          2003       2002           2003       2002         2003        2002
                        --------- ------------  ---------- -----------   ----------------------  ------------ -----------

  United Kingdom        $  1,772   $      357   $     (17)  $      (8)   $   3,332  $      174   $      (37) $       (28)
  Europe                     250          319         (49)        (60)         170          60          (73)         (98)
  Australasia                229           40        -            (29)         531         177           (7)         (59)
  North America             (208)        -              3        -            (399)      -               15        -
                        ---------  -----------  ---------- -----------   ---------- -----------  ----------- ------------
     Total              $  2,043   $      716   $     (63) $      (97)   $   3,634  $      411   $     (102) $      (185)
                        =========  ===========  ========== ===========   ========== ============ =========== ============
Attributable to:
Continuing operations   $  2,032   $      716   $     (57)  $     (97)   $   3,588  $      411   $      (89) $      (185)
Discontinued operations       11         -             (6)       -              46        -             (13)       -
                        ---------  -----------  ---------- -----------   ---------- ------------ ----------- ------------
                        $  2,043   $      716   $ (63)       $    (97)   $   3,634  $      411   $     (102) $      (185)
                        =========  ===========  ========== ===========   ========== ============ =========== ============

</TABLE>


(a) Sales are attributed to geographic areas based on the location of the
customers. (b) Represents property, plant and equipment, net.

                                       F-9

<PAGE>

Note 6 - Commitments and Contingencies

         From time to time, the Company is also subject to legal proceedings and
claims arising from the conduct of its business operations, including litigation
related to personal injury claims, customer contract matters, employment claims
and environmental matters. While it is impossible to ascertain the ultimate
legal and financial liability with respect to contingent liabilities, including
lawsuits, the Company believes that the aggregate amount of such liabilities, if
any, in excess of amounts accrued or covered by insurance, will not have a
material adverse effect on the consolidated financial position or results of
operation of the Company.


Note 8 - Restatement of Previously Issued Financial Statements

On January 13, 2003, Spear & Jackson Inc. ("the Company") filed its annual
report on Form 10-KSB for the fiscal year ended September 30, 2002. On May 28,
2003 the Company filed Amendment No. 1 to the Annual Report on Form 10-KSB for
the fiscal year ended September 30, 2002. The amendment restated the original
Form 10-KSB in order to re-present the acquisition of Spear & Jackson plc and
Bowers Group plc by Megapro Tools, Inc. as a reverse takeover. The impact of
this restatement of the basis of consolidation was reflected in the Quarterly
Report on form 10-QSB for the three and six month periods ended March 31, 2003
and March 31, 2002 which was filed on May 9, 2003.

Amendment No. 2 to the Annual Report on Form 10-KSB for the year ended September
30, 2002 was filed on December 30, 2003 in order to amend and restate the
consolidated financial statements for both the year ended September 30, 2002 and
the year ended September 30, 2001. Adjustments that impacted the Consolidated
Statement of Operations, the Consolidated Balance Sheet and the Consolidated
Statement of Changes in Shareholders' Equity for the year ended September 30,
2002 also affected the previously filed forms 10-QSB and 10-QSB/A for the
quarters ended December 31, 2002, March 31, 2003 and June 30, 2003. These
quarterly returns have accordingly been restated.

Amendments made herewith to form 10-QSB, as filed on May 9, 2003, for the three
and six month periods ended March 31, 2003 and March 31, 2002 in respect of the
above adjustments, specifically comprise the following:

1.       The presentation of the Company's UK defined benefit pension plan has
         been restated. The adjustments required arose from errors and omissions
         in the calculations that were prepared by the Company's actuaries when
         producing the pension plan disclosures that were originally included in
         Amendment 1 to Form 10-KSB for the year ended September 30, 2002.
         The errors and omissions comprised:

a)                Overstatements in the calculation of the market related value
                  of assets, which meant that additional unrecognized actuarial
                  losses should have been amortized in the consolidated income
                  statement for the years ended September 30, 2002 and September
                  30, 2001.


b)                At September 30, 2002, no comparison of the fair value of plan
                  assets to the accumulated benefit obligation ("ABO") was
                  performed. Consequently a pension prepayment was incorrectly
                  recognized in the consolidated balance sheet despite the ABO
                  being in excess of the fair value of plan assets. The 2002
                  consolidated balance sheet was therefore amended to properly
                  record an additional minimum pension liability equivalent to
                  the shortfall of plan assets compared to the plan's ABO.

c)                The pension disclosures at September 30, 2001 were also
                  reconsidered and an additional minimum pension liability was
                  recognized in respect of that year also.

                                      F-10

<PAGE>

                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)


Note 7 - Restatement of Previously Issued Financial Statements - continued

         At September 30, 2002, item (a) impacted the previously reported figure
         for SGA expenses and also the tax charge for the year. Item (b)
         resulted in the previously disclosed pension asset of $14,962 being
         presented as a pension liability of $20,442 with corresponding debit
         entries being made to deferred taxation of $10,621 and to the "Other
         Comprehensive Income (Loss)" caption within shareholders' equity of
         $24,343. The 2001 ABO pension adjustments, item (c), were reflected in
         the consolidated statement of changes in shareholders' equity for the
         year ended September 30, 2001. They also affected the SFAS 87 charges
         for 2002 and subsequent years.

         These adjustments also impact on the previously submitted financial
         statements for the three and six months ended March 31, 2003 as
         follows. Item (a) reduced the figure for retained profits brought
         forward at October 1, 2002, as originally stated, by $440 with $628
         being credited to the brought forward pension liability and $188 being
         debited to the deferred tax asset at October 1, 2002. Items (b) and (c)
         resulted in the previously disclosed pension asset of $16,654 being
         presented as a pension liability of $19,098 with corresponding debit
         entries being made to deferred taxation of $10,537 and to the "Other
         Comprehensive Income (Loss)" caption within shareholders' equity of
         $24,585.


2.       The fair value of the consideration for the deemed acquisition of
         Megapro Tools, Inc. was revised. This resulted in goodwill of $1,138
         being recognized which was then written off following a goodwill
         impairment review. With regard to the financial statements for the
         three months ended December 31, 2002, retained profits brought forward
         at October 1, 2002 were correspondingly reduced by this amount.

3.       Sales rebates totaling $915 in the three months ended March 31, 2003
         and $756 in the three months ended March 31, 2002, and rebates of
         $1,729 in the six months ended March 31, 2003 and $1,458 in the six
         months ended March 31, 2002, which were previously presented as a
         component of SG&A expense, have been reanalyzed and are now shown as a
         reduction to sales.

4.       Expanded disclosures were included in "Other Comprehensive Income" in
         respect of unrealized gains and losses on derivative instruments to
         provide the quantified disclosures required by paragraphs 45-47 of SFAS
         133.

5.       Additional detailed segmental analysis disclosure.

6.       Additional contingencies disclosure. This has been done to supplement
         the original presentation and to ensure consistency with the footnote
         included in the financial statements for the year ended September 30,
         2002 which were included in Form 10-KSB/A (Amendment No 2) which was
         filed on December 29, 2003.

In addition to the above, following the disposal of the Company's Megapro
screwdriver division in September 2003, the results of that business were
re-classified as discontinued operations in the Company's Consolidated Statement
of Operations for the year ended September 30, 2003. The Consolidated Statements
of Operations for the quarters ended December 31, 2002, March 31, 2003 and June
30, 2003 have also been revised to incorporate a similar re-classification of
operations.

The following tables present the Consolidated Statements of Operations for the
three and six months ended March 31, 2002 and March, 31 2001, together with the
Consolidated Balance Sheet as at March 31, 2002, as previously reported and as
restated. The financial information is presented in thousands, except for per
share data.

                                      F-11

<PAGE>


                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)




Spear & Jackson, Inc.
Consolidated Statement of Operations
<TABLE>
<CAPTION>

                                                                          For the Three Months Ended
                                                                                March 31, 2003
                                                        -----------------------------------------------------------------
                                                        As Previously     As Restated      Discontinued    As Restated
                                                          Reported     Before Disclosure    Operations   After Disclosure
                                                                        Of Discontinued                   Of Discontinued
                                                                          Operations                        Operations
                                                        -------------- ------------------ ------------- -----------------
<S>                                                          <C>       <C>                      <C>     <C>
Net sales                                               $      26,220  $          25,305   $      (271) $         25,034
Cost of goods sold                                             17,008             17,008          (168)           16,840
                                                        -------------- ------------------ ------------- -----------------
Gross profit                                                    9,212              8,297          (103)            8,194

Operating costs and expenses:
Selling, general and administrative expenses                    7,169              6,254           (92)            6,162
                                                        -------------- ------------------ ------------- -----------------
Operating income (loss) from continuing operations              2,043              2,043           (11)            2,032

Other income (expense)

Rental income                                                      37                 37                              37
Interest and bank charges (net)                                   (63)               (63)            6               (57)
                                                        -------------- ------------------ ------------- -----------------
Income (loss) from continuing operations before taxation        2,017              2,017            (5)            2,012
Provision for income taxes                                       (573)              (573)         -                 (573)
                                                        -------------- ------------------ ------------- -----------------

Income (loss) from continuing operations                        1,444              1,444            (5)            1,439
                                                        -------------- ------------------ ------------- -----------------

Discontinued operations:
 Income from operations of Megapro screwdriver
 division                                                        -                  -                5                 5
                                                        -------------- ------------------ ------------- -----------------
Income from discontinued operations                              -                  -                5                 5
                                                        -------------- ------------------ ------------- -----------------

Net income                                              $       1,444  $           1,444   $      -     $          1,444
                                                        ============== ================== ============= =================

Basic and diluted earnings per share:

From continuing operations                                      $0.12              $0.12         $0.00             $0.12
From discontinued operations                                     0.00               0.00          0.00              0.00
                                                        -------------- ------------------ ------------- -----------------
Total                                                           $0.12              $0.12         $0.00             $0.12
                                                        ============== ================== ============= =================

Weighted average shares outstanding                        12,011,122         12,011,122    12,011,122        12,011,122
                                                        ============== ================== ============= =================


</TABLE>

                                      F-12

<PAGE>


Spear & Jackson, Inc.
Consolidated Statement of Operations
<TABLE>
<CAPTION>

                                                                          For the Three Months Ended
                                                                                March 31, 2002
                                                        -----------------------------------------------------------------
                                                        As Previously     As Restated    Discontinued     As Restated
                                                          Reported     Before Disclosure  Operations   After Disclosure
                                                                        Of Discontinued                 Of Discontinued
                                                                          Operations                      Operations
                                                        -------------- ------------------ ------------- -----------------
<S>                                                     <C>            <C>                <C>           <C>
Net sales                                               $      22,867  $          22,111  $       -     $         22,111
Cost of goods sold                                             15,447             15,447                          15,447
                                                        -------------- ------------------ ------------- -----------------
Gross profit                                                    7,420              6,664          -                6,664

Operating costs and expenses:
Selling, general and administrative expenses                    6,704              5,948          -                5,948
                                                        -------------- ------------------ ------------- -----------------
Operating income from continuing operations                       716                716          -                  716

Other income (expense)

Rental income                                                      31                 31          -                   31
Interest and bank charges (net)                                   (97)               (97)                            (97)
                                                        -------------- ------------------ ------------- -----------------
Income from continuing operations before taxation                 650                650          -                  650
Provision for income taxes                                       (254)              (254)         -                 (254)
                                                        -------------- ------------------ ------------- -----------------
Income from continuing operations                                 396                396          -                  396
                                                        -------------- ------------------ ------------- -----------------

Discontinued operations:
 Income from operations of Megapro screwdriver
 division                                                        -                  -             -                 -
                                                        -------------- ------------------ ------------- -----------------
Income from discontinued operations                              -                  -             -                 -
                                                        -------------- ------------------ ------------- -----------------
Net income                                              $         396  $             396  $       -     $            396
                                                        ============== ================== ============= =================

Basic and diluted earnings per share:

From continuing operations                                      $0.11              $0.11         $0.00             $0.11
From discontinued operations                                     0.00               0.00          0.00              0.00
                                                        -------------- ------------------ ------------- -----------------
Total                                                           $0.11              $0.11         $0.00             $0.11
                                                        ============== ================== ============= =================

Weighted average shares outstanding                         3,543,281          3,543,281     3,543,281         3,543,281
                                                        ============== ================== ============= =================


</TABLE>

                                      F-13

<PAGE>

                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)


Spear & Jackson, Inc.
Consolidated Statement of Operations

<TABLE>
<CAPTION>

                                                                           For the Six Months Ended
                                                                                March 31, 2003
                                                        -----------------------------------------------------------------
                                                        As Previously     As Restated    Discontinued     As Restated
                                                          Reported     Before Disclosure  Operations   After Disclosure
                                                                        Of Discontinued                 Of Discontinued
                                                                          Operations                      Operations
                                                        -------------- --------------------------------------------------
<S>                                                     <C>            <C>                <C>           <C>
Net sales                                               $      49,555  $          47,826  $       (606) $         47,220
Cost of goods sold                                             32,484             32,484          (394)           32,090
                                                        -------------- ------------------ ------------- -----------------
Gross profit                                                   17,071             15,342          (212)           15,130

Operating costs and expenses:
Selling, general and administrative expenses                   13,437             11,708          (166)           11,542
                                                        -------------- ------------------ ------------- -----------------
Operating income (loss) from continuing operations              3,634              3,634           (46)            3,588

Other income (expense)
Royalties (net)                                                    12                 12          -                   12
Rental income                                                      70                 70          -                   70
Interest and bank charges (net)                                  (102)              (102)           13               (89)
                                                        -------------- ------------------ ------------- -----------------
Income (loss) from continuing operations before taxation        3,614              3,614           (33)            3,581
Provision for income taxes                                       (959)              (959)         -                 (959)
                                                        -------------- ------------------ ------------- -----------------
Income (loss) from continuing operations                        2,655              2,655           (33)            2,622
                                                        -------------- ------------------ ------------- -----------------
Discontinued operations:
 Income from operations of Megapro screwdriver
 division                                                        -                  -               33                33
                                                        -------------- ------------------ ------------- -----------------
Income from discontinued operations                              -                  -               33                33
                                                        -------------- ------------------ ------------- -----------------
Net income                                              $       2,655  $           2,655  $       -     $          2,655
                                                        ============== ================== ============= =================

Basic and diluted earnings per share:

From continuing operations                                      $0.22              $0.22         $0.00             $0.22
From discontinued operations                                     0.00               0.00          0.00              0.00
                                                        -------------- ------------------ ------------- -----------------
                                                                $0.22              $0.22         $0.00             $0.22
                                                        ============== ================== ============= =================

Weighted average shares outstanding                        12,011,122         12,011,122    12,011,122        12,011,122
                                                        ============== ================== ============= =================

</TABLE>

                                      F-14

<PAGE>




                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                          (in thousands except shares)


Spear & Jackson, Inc.
Consolidated Statement of Operations

<TABLE>
<CAPTION>

                                                                           For the Six Months Ended
                                                                                 March 31, 2002
                                                        -----------------------------------------------------------------
                                                        As Previously     As Restated     Discontinued      As Restated
                                                          Reported     Before Disclosure   Operations    After Disclosure
                                                                        Of Discontinued                   Of Discontinued
                                                                          Operations                        Operations
                                                        -------------- ------------------ ------------- -----------------
<S>                                                     <C>            <C>                <C>           <C>
Net sales                                               $      44,086  $          42,628  $      -      $         42,628
Cost of goods sold                                             30,333             30,333                          30,333
                                                        -------------- ------------------ ------------- -----------------
Gross profit                                                   13,753             12,295         -                12,295

Operating costs and expenses:
Selling, general and administrative expenses                   13,342             11,884         -                11,884
                                                        -------------- ------------------ ------------- -----------------
Operating income from continuing operations                       411                411         -                   411

Other income (expense)

Rental income                                                      61                 61         -                    61
Interest and bank charges (net)                                  (185)              (185)        -                  (185)
                                                        -------------- ------------------ ------------- -----------------

Income from continuing operations before taxation                 287                287         -                   287
Provision for income taxes                                       (195)              (195)        -                  (185)
                                                        -------------- ------------------ ------------- -----------------
Income from continuing operations                                  92                 92         -                    92
                                                        -------------- ------------------ ------------- -----------------

Discontinued operations:
 Income from operations of Megapro screwdriver
 division                                                       -                  -             -                 -

                                                        -------------- ------------------ ------------- -----------------
Income from discontinued operations                             -                  -             -                 -
                                                        -------------- ------------------ ------------- -----------------
Net income                                              $         396  $             396  $      -      $            396
                                                        ============== ================== ============= =================

Basic and diluted earnings per share:

From continuing operations                                      $0.11              $0.11         $0.00             $0.11
From discontinued operations                                     0.00               0.00          0.00              0.00
                                                        -------------- ------------------ ------------- -----------------
Total                                                           $0.11              $0.11         $0.00             $0.11
                                                        ============== ================== ============= =================

Weighted average shares outstanding                         3,543,281          3,543,281     3,543,281         3,543,281
                                                        ============== ================== ============= =================


</TABLE>

                                      F-15

<PAGE>

                              SPEAR & JACKSON, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


                          (in thousands except shares)




Spear & Jackson, Inc.
Consolidated Balance Sheet

                                                   At March 31, 2003
                                           As Previously      As Restated
                                 ASSETS       Reported
                                           ----------------- -----------------
Current assets:
 Cash and cash equivalents                 $          7,330  $          7,330
 Trade receivables, net                              18,189            18,189
 Inventories                                         23,985            23,985
 Other current assets                                 1,115             1,105
                                           ----------------- -----------------
Total current assets                                 50,619            50,609

Property, plant and equipment, net                   19,598            19,598
Pension asset                                        16,654              -
Deferred taxation                                      -                9,116
Investments                                             140               140
                                           ----------------- -----------------
Total assets                               $         87,011  $         79,463
                                           ================= =================


                  LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
 Notes payable                            $             239  $            239
 Short term debt                                          9                 9
 Trade accounts payable                              11,403            11,403
 Accrued expenses and other liabilities              13,788            13,789
 Director's loan payable                                100               100
 Foreign taxes payable                                   56                56
                                           ----------------- -----------------
Total current liabilities                            25,595            25,596
Long term debt                                           10                10
Other liabilities                                     1,826             1,826
Pension liability                                      -               19,098
Deferred income taxes                                 1,609              -
                                           ----------------- -----------------
Total liabilities                                    29,040            46,530
                                           ----------------- -----------------
Stockholders' equity:
 Common stock                                            12                12
 Additional paid in capital                          50,455            51,590
 Accumulated other comprehensive income:
  Pension additional minimum liability                 -              (24,585)
  Foreign currency translation adjustment             4,284             4,284
  Unrealized gain on derivative instruments            -                  (10)
 Retained earnings                                    3,220             1,642
                                           ----------------- -----------------
                                                     57,971            32,933
                                           ----------------- -----------------
Total stockholders' equity                 $         87,011  $         79,463
                                           ================= =================

                                      F-16

<PAGE>

ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Forward Looking Statements

The information in this discussion contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1934, as amended. These
forward-looking statements involve risks and uncertainties, including statements
regarding the Company's capital needs, business strategy and expectations. Any
statements contained herein that are not statements of historical facts may be
deemed to be forward-looking statements. In some cases, you can identify
forward-looking statements by terminology such as "may", "will", "should",
"potential" or "continue", the negative of such terms or other comparable
terminology. Actual events or results may differ materially. In evaluating these
statements, you should consider various factors, including the risks outlined in
the Risk Factors section below, and, from time to time, in other reports the
Company files with the SEC. These factors may cause the Company's actual results
to differ materially from any forward-looking statement. The Company disclaims
any obligation to publicly update these statements, or disclose any difference
between its actual results and those reflected in these statements. The
information constitutes forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995.

Overview

We were founded to design, market and manufacture innovative multi-bit
screwdriver products under the Megapro name and incorporating the retractable
cartridge design patented by Winsire Enterprises Corporation. Our business
commenced in 1994 when we began selling our Megapro 15 in 1 screwdriver to the
industrial and commercial tools market. Our revenues have grown since 1994 as we
have expanded our product sales in the industrial and commercial tools market
and have expanded our line of screwdriver products. We commenced sales of our
screwdriver products to the retail market in late 1996. Our objectives are to
further pursue sales in this market and generate sales of the newly developed
Megapro Multi Quick-change screwdriver, the Megapro cordless screwdriver and our
Power2 Bits screwdriver bits.

With effect from September 30, 2003 the Company exited its screwdriver
operations following the disposal of the trade and assets of Mega Tools Limited
and Mega Tools USA, Inc. As a result of the sale, the results of the Megapro
business have been disclosed as a discontinued operation in the Consolidated
Statements of Operations of the Company for the three and six-month periods
ended March 31, 2003.

On September 6, 2002 Megapro Tools, Inc. acquired the entire issued share
capital of Spear & Jackson plc and Bowers Group plc ("S&J"). As further
explained in note 4 of the financial statements, this transaction has been
treated as a reverse acquisition. Reflecting the relative size of S&J within the
continued business, Megapro Tools, Inc. changed its name to Spear & Jackson,
Inc.

Spear & Jackson, Inc., through its principal operating entities, as disclosed in
note 1 to the financial statements, manufactures and distributes a broad line of
hand tools, lawn and garden tools, industrial magnets and metrology tools
primarily in the United Kingdom, Europe, Australia, North and South America,
Asia and the Far East. These products are manufactured and distributed under
various brand names including:

                                       6

<PAGE>

*        Spear & Jackson - garden tools;
*        Neill - hand tools;
*        Bowers - bore gauges and precision measuring tools;
*        Coventry Gauge - air and other gauges;
*        CV - precision measuring instruments;
*        Robert Sorby - wood turning tools;
*        Moore & Wright - precision tools;
*        Eclipse - blades and magnetic equipment;
*        Elliot Lucas - pincers and pliers; and
*        Tyzack - builders' tools

Until the disposal of the screwdriver division in September 2003, the Company
also manufactured and sold a range of patented multi bit screwdrivers under the
"Megapro" brand name.

The principal operating divisions and their key products comprise:

*        Neill Tools (hand hacksaws, blades, hacksaw frames, builders' tools,
         riveter guns, wood saws and lawn, garden and agricultural tools, all
         non-powered).

*        Eclipse Magnetics (permanent magnets, magnetic tools, machine tools,
         magnetic chucks and turnkey magnetic systems).

*        The Metrology Division comprising Bowers Metrology (high specification
         metrology instruments including precision bore gauges, universal gauges
         and hardness testing equipment); Moore & Wright and Coventry Gauge (low
         technology measuring tools and hand held gauges for checking the
         threads, diameters and tapers of machined components);

*        Robert Sorby (hand held wood working tools and complementary products).

In addition, Spear & Jackson plc has subsidiary companies in France (Spear &
Jackson France S.A.) and Australasia (Spear & Jackson (Australia) Pty Ltd and
Spear & Jackson (New Zealand) Ltd which act as distributors for Spear & Jackson
and Bowers manufactured products and complementary products sourced from third
party suppliers.

Our strategy is to maintain and develop the revenues of our businesses through
such methods as:

(a)      Maintaining and heightening the profile of our existing quality brand
         names. Such activity will comprise trade, general and TV advertising,
         extensive promotional work at trade shows, the development of corporate
         web sites, etc.

(b)      Continuous product improvement and innovation.

(c)      Increasing market share by offering highly competitive product
         offerings.

                                       7

<PAGE>

(d)      Launch new and innovative product and product ranges.

(e)      Significantly increase our US market penetration via large "Big Box"
         outlets.

Recent product announcements include:

A range of power tools and air power tools has been launched in the UK and
Europe. The range of 71 products includes such items as compressors, air drills,
impact wrenches, spray guns, angle grinders, impact drills, jig saws, sanders,
circular saws, engravers to Mitre saws and many more. The significance of these
power tools is that they are all finished with a new "soft touch" and are sold
as kits in blow mould cases.

All of the new products were presented at the Cologne Show in March, the premier
hardware and tool show in the world.

The Tyzack brand, synonymous with plastering, and the initiator of the first
steel plasterers' trowel launched a comprehensive range of drywall lining tools.
The range comprises jointing, taping knives and saws with numerous accessories
including support props, corners and lifters.

Eclipse Magnetics signed an exclusive supply agreement with a leading
manufacturer of metal detection equipment. This will complement the division's
existing expertise in the separation field and will provide total foreign body
detection of all metals to the food and pharmaceutical industries.

Eclipse also launched a European multi-lingual merchandiser range of 52
different magnets at the Cologne International Hardware Fair. The revolutionary
packaging and display units enable the magnets to be positioned at key point of
sale locations, enabling magnets to take their rightful place at the forefront
of engineering consumables.

In addition, Eclipse Magnetics began a worldwide launch of a new safety shim
(TM). This ingenious idea of creating a safety pre-test system to guarantee a
safe lift for lifting loads has been granted full patent status.

Bowers launched two new products in the USA, the Checkmatic universal bench
gauge and the revolutionary Smart Plug 2-point measuring system. These tools are
capable of performing a multitude of internal and external measuring tasks.

Our business plan will also focus on improved profitability by the initiation of
improved export distribution channels, improved production efficiency and the
formation of new manufacturing and selling partnerships and joint ventures. Such
strategic partners will give us the potential for the cross distribution of
products, joint manufacturing projects and joint product development.

                                       8

<PAGE>

DISCUSSION OF CRITICAL ACCOUNTING POLICIES

We prepare our consolidated financial statements in accordance with accounting
principles generally accepted in the United States. As such, we are required to
make certain estimates, judgements and assumptions that we believe are
reasonable based upon the information available. These estimates and assumptions
affect the reported amounts of assets and liabilities as of the date of the
consolidated financial statements and the reported amounts of revenues and
expenses during the periods presented. Actual results could differ significantly
from those estimates under different assumptions and conditions.

Management's Discussion and Analysis or Plan of Operations in the Company's 10
KSB/A (Amendment No. 2) filing for the year ended September 30, 2002 included a
detailed discussion which addressed our most critical accounting policies. The
quarterly financial statements for the period ended March 31, 2003, attached
hereto, should therefore be read in conjunction with that discussion.

These policies are those that are most important to the portrayal of our
financial condition and results of operations and which require our most
difficult and subjective judgements, often as a result of the need to make
estimates about the effect of matters that are inherently uncertain. Our most
critical accounting policies are those relating to revenue recognition, foreign
exchange risk and inventory valuation.

In addition, the Company operates a contributory defined benefit pension plan
covering certain of its employees in the United Kingdom based subsidiaries of
Spear & Jackson plc. Several statistical and other factors which attempt to
anticipate future events are used in calculating the expense and liability
related to the plan. These factors include assumptions about the discount rate,
expected return on plan assets and rate of future compensation increases as
determined by us, within certain guidelines, and in conjunction with our
actuarial consultants and auditors. Our actuarial consultants also use
subjective factors such as withdrawal and mortality rates to estimate the
expense and liability related to the plan. The actuarial assumptions used by us
may differ significantly, either favorably or unfavorably, from actual results
due to changing market and economic conditions, higher or lower withdrawal rates
or longer or shorter life spans of participants.

Since September 30, 2002 there have been no changes in our critical accounting
policies and no significant change to the assumptions and estimates related to
them.

RESULTS OF OPERATIONS

The results discussed below compare the three months ended March 31, 2003 with
the three months ended March 31, 2002 and the six months ended March 31, 2003
with the six months ended March 31, 2002. As explained in note 4 to the
financial statements, the acquisition of Spear & Jackson plc and Bowers Group
plc ("S&J") by Megapro Tools, Inc. (now Spear & Jackson, Inc.) has been
accounted for as a reverse acquisition. In these financial statements, S&J is
the operating entity for financial reporting purposes and the financial
statements for all periods represent S&J's financial position and results of
operations. The operating results and net assets of Megapro Tools, Inc. and its
subsidiary companies are included in the consolidated statements from September
6, 2002, the date of their deemed acquisition, until September 30, 2003,
the effective date of disposal of the Megapro screwdriver division.

                                       9

<PAGE>

The disposal of the Megapro companies followed a strategic review of the
screwdriver division by the directors of Spear & Jackson, Inc. from which it was
determined that the screwdriver division was not a core activity. As a result of
the sale, the Megapro business was disclosed in the consolidated financial
statements for the years ended September 30, 2003 and September 30, 2002 as a
discontinued operation. The Consolidated Statements of Operations for the three
and six month periods ended March 31, 2003 and March 31, 2002 included within
the attached financial statements accordingly adopt this presentation.

All figures are expressed in $'000 unless otherwise stated.

OVERVIEW

Net revenues increased by $2,923 (13.2%) from $22,111 to $25,034 in the three
months ended March 31, 2003 compared to the three months ended March 31, 2002.
In the six months to March 31, 2003 net revenues increased by $4,592 (10.8%)
from $42,628 to $47,220 when compared to the six months ended March 31, 2002.

Sales mix has altered significantly towards higher margin products and strict
cost control and manufacturing efficiencies have resulted in substantial
improvements in the gross profit percentage and operating income. These factors
are dealt with in more detail in the sections below.

DIVISIONAL REVIEW

We aim to maintain and develop the revenues of our businesses through the launch
of new products, the enhancement of existing items and the continued marketing
of these companies' brands in order to retain and gain market share.

All divisions of Spear & Jackson, Inc. delivered strong trading performances in
the three months ended March 31, 2003 and the six-month period ending on that
date. Summary details are as follows:

Neill Tools

The Neill Tools business recorded excellent trading results as a consequence of
improved margins, some 2% better than forecast and 5% better than the comparable
period last year.

The division has focused on new product development and this has seen the launch
of a new range of dry lining tools, leather work wear, hand power tools,
spanners, sockets, screwdrivers, pliers and air power tools and compressors. A
strong third quarter is anticipated with these new product ranges allied to
better customer service and support.

                                       10

<PAGE>

Eclipse Magnetics

Financial performance for quarter two showed an increase in operating profits of
10% over the first quarter, giving an 11% return on sales for the company.
Although certain capital projects business has been lost because of the
fragility of the UK industrial market, Eclipse quarter two operating profit was
significantly better than the previous year as a result of improved margins
arising from manufacturing and purchasing efficiencies and good fixed cost
control.

New products and customers were established within the Separation sector of the
business. This supplies the food, pharmaceutical and processing industries with
high added value solutions, winning new contracts from large multinational
clients.

Eclipse has designed and prepared the launch of a new permanent lifting magnet
that has a number of new, patented features. This new product has distinct
advantages over conventional lifting devices and offers the users additional
safety features at competitive prices.

The North American market continued to be a business focus and we have now
introduced new programs with large catalog companies. We also have identified
new partners located across the US to represent the standard range of Eclipse
Magnetics Ltd.

The first phase of the German market entry was completed with Eclipse
establishing a new relationship with Hoffmann which is one of the largest
industrial distribution groups in Europe.

Robert Sorby

Robert Sorby revenues in the six months ended March 31, 2003 showed an increase
over the six months ending March 31, 2002. Q2 sales were 34% higher than those
in Q1 of the current year and were also higher than sales revenues in the three
months ending March 31, 2002.


The company's extensive dealer network and its pro-active consumer marketing
ensure that it remains well positioned to take advantage of market up-turns.

Focus has been maintained on the key markets of the USA, Canada, UK and Ireland.
At the same time we developed new dealers in both Norway and Austria.

In the UK market there was a heavy commitment to consumer promotion through
exhibitions, in-store demonstrations, advertising and our web site.

Sales continued to capitalize on our strength in the lathe chuck market where we
have established ourselves as the leading supplier in the UK market. These now
account for almost 10% of our total sales.

The retail store is continuing to develop and has shown a 16% sales increase on
the back of an improvement in higher margin mail order sales.

                                       11

<PAGE>

The product strategy has been geared towards non `me-too' products which
guarantee a higher gross margin and new products. Of particular note is the
success of the Sandmaster, which is now listed by almost every major dealer
worldwide, and the modular tool rest system. Both of these underline our
commitment to introducing consumer-friendly high margin products.

Bowers

Profits for the quarter were once again ahead of forecast, due to a strong
performance from the export side of the business. A successful promotion was run
in some of the major European and Asian markets and this resulted in excellent
sales of the core Bowers ST 3-point bore gauging product.

Sales to the German market continue to grow significantly, despite the poor
state of the German economy. New listings have been obtained with Hoffmann
Group, one of the largest industrial catalogs in Europe, and this trend is
expected to continue. A promotion concentrating on the special products division
has also been running in Canada and this has resulted in sales increasing by
over 400% compared to the same period last year.

The UK market continues to be difficult, particularly for the low-cost items
sold via distribution. Whilse price pressure and reduced inventories continue to
hurt margins and sales, the larger product work with the automotive and military
sectors is showing signs of improvement. Large orders were received from Airbus
in the quarter and a substantial order was also received from KITS and Leeds
College of Technology to equip two new centers of excellence.

With the unstable global situation, the decision to further reduce costs at the
beginning of the quarter has proved to be correct.

A new 180 page catalog was launched in the UK during the quarter with 70% of
the content being new products compared to the previous version 2 years ago.
These include the Checkmatic bench gauge, the Magnacheck large diameter bore
gauge, the Mestra and Vectra height gauges and the Quadratest lever indicator.
Additionally, an entire new range of testing instruments has been introduced.

S&J France

Sales by S&J France showed an 11% increase over the previous year. The two key
elements in this growth were incremental sales to Castorama and the launch of
the new Cottage range of garden tools.

Castorama is the largest `big box retailer' in France with over 160 outlets. We
were successful in introducing 46 new products which are now available through
all their stores. In the first three months of trading 57% of the budgeted
annual sales were achieved.

At the same time there was an extremely successful launch of the new range of
unique garden tools under the Cottage range. This is a collection of smaller
tools aimed primarily at the female market or those working in restricted areas,
like rockeries. This line is now sold through over 300 retail stores and sales
after four months were 70% of the original scheduled quantity.

                                       12

<PAGE>

Spear & Jackson Australia and Spear & Jackson New Zealand

Both S&J Australia and S&J New Zealand continue to out perform their current
year sales targets and prior period performances. In the six months ended March
31, 2003, sales were $1.7 million higher than in the same period last year.
Sales for the quarter ended March 31, 2003 were $0.8 million higher than those
recorded for the quarter ended March 31, 2002.The quarter 3 outlook has been
further boosted by the receipt of large incremental orders from Super Cheap Auto
and Bunnings.


COSTS OF GOODS SOLD AND GROSS PROFIT

Costs of goods sold as a percentage of sales decreased to 67.9% during the first
six months of the year compared to 71.1% during the six months ending March 31,
2002. Similarly, costs of goods sold as a percentage of sales fell to 67.3% in
the three months ended March 31, 2003 from 69.9% in the comparable quarter in
2002.

These movements reflect more favorable sales mixes, focus on strict product
cost control and the benefit derived in 2003 from the closure of the loss making
calibration business division in September 2002.

Current year gross profit  percentages and their prior period  comparatives  are
therefore as follows:  quarter ended March 31, 2003: 32.7% (2002: 30.1%), six
months ended March 31, 2003: 32.1% (2002: 28.9%).

We will continue to monitor and evaluate means of maintaining and improving
current sales mixes and of further reducing costs of goods sold across all our
principal trading operations to avoid any margin erosion.

EXPENSES

Expressed as a percentage of sales, selling, general and administration expenses
were 24.4% of revenues for the six months ended March 31, 2003 (2002: 27.9%) and
24.6% of revenues for the quarter ended March 31, 2003 (2002: 26.9%).

Other income and expenses reduced from a net expense of $124 in the six months
ended March 31, 2002 to a net expense of $7 in the half year ended March 31,
2003. This movement is attributable to decreased interest charges in the
Company's French and Australian businesses and the receipt of royalty and rent
income in the acquired Megapro businesses.

In the quarter ended March 31, 2003, other net expenses decreased to $20 from
$66 for the three months to March 2002. This reduction again relates to interest
savings in the Spear & Jackson French and Australian businesses.

                                       13

<PAGE>

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

Our income from continuing operations before income taxes in the six months
ended March, 31, 2003 amounted to $3,581. This compares to an income before
taxes for the half-year ended March 31, 2002 of $287. As discussed above, this
increase in profitability is derived from improvements in gross margins and the
ongoing benefits arising from overhead cost savings.

In the quarter ended March 31, 2003, income before income taxes was $2,012
compared to a profit of $650 in the three months ended March 31, 2002. The
improvement of $1,362 is again attributable to increased sales margins and
continued overhead reductions.

INCOME TAX

Income taxes were $959 in the half-year ended March 31, 2003 compared to a $195
income tax charge in the six months ending March 31, 2002. The provision for
income taxes in the quarter ended March 31, 2003 was $573; an increase of $319
on the provision made in the three months ended March 31, 2002.

Income taxes were 26.8% of profits before tax in the six months ended March 31,
2003 as opposed to 67.9% of the profit before income taxes in the six months
ended March 31, 2002. Tax for the quarter ending March 31 was 28.5% of profits
in 2003 and 39% in 2002.

Differences between the effective rate and the statutory rate result from tax
charges in certain overseas subsidiaries within the Spear & Jackson group being
taxed at rates different from the effective rate, the non recognition of tax
losses within the deferred tax computation and permanent differences between
accounting and taxable income as a result of non-deductible expenses and
non-taxable income. Because of the availability of tax net operating losses it
is not anticipated that any of the tax charge for the six months ended March 31,
2003 will result in the payment of income tax.

NET PROFIT FROM CONTINUING OPERATIONS

Our net profit from continuing operations after income taxes was $2,622 for the
six months ended March 31, 2003. This compares to a profit after income taxes of
$92 for the half year ended March 31, 2002. In the quarter ended March 31, 2003,
net profit amounted to $1,439. This compares to a profit of $396 arising in the
comparable quarter last year.

DISCONTINUED OPERATIONS

The discontinued operations refer to the Megapro screwdriver division of Spear &
Jackson, Inc. which was acquired on September 6, 2002 and which was disposed of
with effect from September 30, 2003. The directors of the Company had previously
carried out a goodwill impairment appraisal and a strategic review of the
division in September 2002 and had determined that this division did not
represent a continuing core activity. Various divestment strategies were
considered and as of September 30, 2003 the trade and assets of the principal
Megapro companies were transferred, at their net book value, to a management
buy-in team headed by the managing director of the Megapro business.

                                       14

<PAGE>

Total income attributable to discontinued operations was $5 in the quarter ended
March 31, 2003 and $33 in the six months ended on that date. There are no
comparable items in the quarter ended March 31, 2002 nor the six months ended
March 31, 2002.

FINANCIAL CONDITION

Liquidity and Capital Resources

Our cash position was $7,330 at March 31, 2003 and our net assets were $32,933
at that date.

Net cash generated from operating activities in the six-month period ended March
31, 2003 was $4,353 compared to an operating cash generation of $780 in the six
months ended March 31, 2002. This improvement in 2003 arises from the
significant increase in net income (adjusted for depreciation and deferred
taxes) of $3.3 million and trade working capital inflows relating to improved
receivables collections of $1.3 million and a trade payables increase of $0.6
million offset by an increase in inventories of $2.2 million. The inventory
increase arises in Spear & Jackson's Australian subsidiary (stock build to
service Q3 sales) and in the UK garden tools business (cyclical increase related
to the UK spring garden season). Other working capital movements include
increases in other current and non-current liabilities of $1.3 million, which,
in the main, are associated with the increases in leasing liabilities following
the replacement of the UK leased vehicle fleet in January 2003.

Cash outflow from investing activities was $2,441 in the period ended March 31,
2003. This compares to an outflow from investing activities in the period ended
March 31, 2002 of $217. Net cash used in investing activities in 2003 includes
$2,611 of equipment purchases (2002: $217) which relates principally to the
replacement of the UK car fleet under capitalized operating leases and the
purchase of computer equipment in Australia.

Net cash absorbed by financing activities was $1,068 in the period ended March
31, 2003 compared to net cash provided by financing activities in the period
ended March 31, 2002 of $324. Cash utilized by financing activities in the
period ended March 31, 2003 includes the repayment of short-term debt in
Australia of $1,004 and the repayment of a shareholder loan of $60. The cash
provided by financing activities in the period ended March 31, 2002 comprises
additional overdraft advances of $324.

Our business operations have been funded primarily from net operating income. We
have also utilized loans from the Bank of Montreal, shareholder loans and other
bank facilities.

Mr. Neil Morgan, a shareholder, has advanced to us the amount of $100 as a
director's loan. The loan is unsecured, bears interest at 10.25% per annum and
has non specific terms of repayment.

                                       15

<PAGE>

Mr. Robert Jeffrey, another of our shareholders, had previously advanced us an
unsecured loan at an interest rate of 10.25% per annum, repayable on demand.
This loan was repaid during the period.

We obtained a fixed loan from the Bank of Montreal in 1998. This loan is payable
on demand with an agreed repayment schedule requiring payments of $10 per annum,
paid monthly in equal instalments, plus interest at the bank's funding plus 1.5%
per annum. The principal amount of the loan outstanding at March 31, 2003 was
$19.

The Spear & Jackson and Bowers companies have overdraft facilities with various
UK, French and Australian banks but none of the companies are currently funding
any of their financing requirements through bank or other loans.

Funding to finance new products launches in the Spear & Jackson and Bowers
companies will be funded from their existing banking facilities. We believe that
we have sufficient capital resources and liquidity over both the short and
medium term to sustain our business operations. While we may require additional
financing in order to pursue any planned expansion of the Megapro operations, we
do not require additional financing in order to sustain our present business
operations.


EFFECT OF NEW ACCOUNTING STANDARDS

SFAS No. 145, Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB
Statement No. 13, and Technical Corrections was issued April 2002. This
Statement rescinds FASB Statement No. 4, Reporting Gains and Losses from
Extinguishment of Debt, and an amendment of that Statement, FASB Statement No.
64, Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements. This
Statement also rescinds FASB Statement No. 44, Accounting for Intangible Assets
of Motor Carriers. This Statement amends FASB Statement No. 13, Accounting for
Leases, to eliminate an inconsistency between the required accounting for
sale-leaseback transactions and the required accounting for certain lease
modifications that have economic effects that are similar to sale-leaseback
transactions. This Statement also amends other existing authoritative
pronouncements to make various technical corrections, clarify meanings, or
describe their applicability under changed conditions. The provisions of this
Statement related to the rescission of Statement 4 shall be applied in fiscal
years beginning after May 15, 2002. The provisions in paragraph 8 and 9(c) of
this Statement related to Statement 13 shall be effective for transactions
occurring after May 15, 2002. All other provisions of this Statement shall be
effective for financial statements issued on or after May 15, 2002. The effects
of implementation are not material.

SFAS No. 146 Accounting for Costs Associated with Exit or Disposal Activities
was issued June 2002. This Statement addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force (EITF) Issue No. 94-3, Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring). The provisions of this
Statement are effective for exit and disposal activities that are initiated
after December 31, 2002.

                                       16

<PAGE>

In September 2002, the FASB issued SFAS No. 147, Acquisition of Certain
Financial Institutions. SFAS No. 147 changed the special accounting for
unidentifiable intangible assets recognised under SFAS No. 72. Transition
provisions for previously recognised unidentifiable intangible assets were
effective on October 1, 2002. The effects of implementation had no impact on the
Company's consolidated financial statements.

ITEM 3. CONTROLS AND PROCEDURES

Within the 90-day period prior to the filing of this report, an evaluation of
the effectiveness of the Company's disclosure controls and procedures was made
under the supervision and with the participation of the Company's management,
including the chief executive officer and chief financial officer. Based on that
evaluation, the CEO and CFO concluded that the Company's disclosure controls and
procedures are effective to ensure that information required to be disclosed by
the Company in reports that it files or submits under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time
periods specified in Securities and Exchange Commission rules and forms.
Subsequent to the date of their evaluation, there were no significant changes in
the Company's internal controls or in other factors that could significantly
affect these controls, including any corrective actions with regard to
significant deficiencies and material weaknesses.

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

The Company is, from time to time, subject to legal proceedings and claims
arising from the conduct of its business operations, including litigation
related to personal injury claims, customer contract matters, employment claims
and environmental matters. While it is impossible to ascertain the ultimate
legal and financial liability with respect to contingent liabilities, including
lawsuits, the Company believes that the aggregate amount of such liabilities, if
any, in excess of amounts accrued or covered by insurance, will not have a
material adverse effect on the consolidated financial position or results of
operation of the Company.

Item 2.  Changes in Securities and use of Proceeds

None

Item 3.  Defaults upon Senior Securities

None

Item 4.  Submission of Matters to a Vote of Security Holders

None

Item 5.  Other Information

None

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<PAGE>

Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits

31.1 302 Certification of Chief Executive Officer

31.2 302 Certification of Chief Accounting Officer

32.1 906 Certification of Chief Executive Officer

32.2 906 Certification of Chief Accounting Officer

(b) Reports on Form 8-K

Form 8-K was filed on December 12, 2002 pertaining to the Changes in
Registrant's name from MegaPro Tools, Inc. to Spear & Jackson, Inc. under Item
5.

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<PAGE>




SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorised.

SPEAR & JACKSON, INC.



By:      /s/Dennis Crowley            Dated: March 8, 2004
         -----------------

         Dennis Crowley
         Chairman, President and
         Chief Executive Officer
        (Principal Executive Officer)




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