Interim results - 6 months to 31st March 2008

I am pleased to report that Group sales for the 6 months to 31 March 2008 were up 5% at £3.47 million (2007: £3.30 million). Contracted recurring revenues, relating principally to annual software licences and hosting fees, represented 67% of turnover.

Pre-tax profit for the period was £1.23 million (2007: £226,000). This includes a profit on disposal of surplus property of £668,000.

Adjusted operating profit, before non-cash IFRS charges and one-off redundancy costs, was £505,000 (2007: £90,000) representing an operating margin of 14.5% (2007: 2.7%).

These results reflect increased sales of our Vecta sales intelligence product, partially offset by a planned reduction in hardware maintenance revenue of £58,000, together with careful management of the Group's cost base.

We continue to see robust competition in the marketplace for our core distribution software applications and integrated Quantum VS products. However, the number of customer demonstrations in which we are involved remains encouraging.

The Vecta business, which was acquired in October 2006, has continued to perform well. In line with our expectations at the time of the acquisition, Vecta has been earnings enhancing in the current financial year and 95 customers of the Vecta product have now signed licences and support contracts.

The Group's hosting operation in Milton Keynes has continued to develop as more customers switch from standard licensed software arrangements to fully outsourcing the delivery of the Group's software products. We now have 64 customers hosted including those who have taken the Vecta OnDemand service which was released last year. Hosted customers now account for 19% of the Group's revenue (2007: 16%).

Research & Development expenditure amounted to £620,000 during the period (£1.3 million in the full year to 30 September 2007) all of which has been charged in the Income Statement. Our R&D effort continues to focus on the continued development and enhancement of our distribution software applications and sales intelligence product.

The Group's balance sheet is strong with net assets of £14.8 million as at 31 March 2008. Cash balances amounted to £8.0 million compared to £6.0 million at 30 September 2007. This reflects strong operating cash flows together with £1.35 million from the disposal of a surplus property. We remain interested in using our cash resources to make further acquisitions of compatible software businesses. The Board continues to review the other freehold properties owned by the Group.

Your Directors have resolved to pay an interim dividend of 0.713p per ordinary share, the same as last year. In addition your Directors have resolved to pay a special dividend of 5p per share, returning to shareholders a further £1.23 million of cash. The interim and special dividends will be paid on 1 August 2008 to those shareholders on the register on 11 July 2008. The shares will be ex-dividend on 9 July 2008.

We continue to see significant competition in the marketplace we address. However, with current levels of demand, in particular for our hosting services and sales intelligence product, I can look forward to the rest of the year with confidence.

MICHAEL HELLER
Chairman

29th May 2008.

Interim 2008 Reports & Accounts (Word Document).
Preliminary Year End 2007 Reports & Accounts (Word Document).
Interim 2007 Reports & Accounts (Word Document).
Preliminary Year End 2006 Reports & Accounts (Word Document).
Interim 2006 Reports & Accounts (Word Document).
Preliminary Year End 2005 Reports & Accounts (Word Document).