StatPro Group PLC – Interim Results

For immediate release
31 July 2006

STATPRO GROUP PLC

(“StatPro”, the “Group” or the “Company”)

Interim results for the six months ended 30 June 2006

StatPro Group plc, the AIM listed provider of portfolio analytics solutions for the global asset management industry, announces its interim results for the six months ended 30 June 2006. Six months ended Six months ended Change 30 June 2006.

                                    Six months ended  Six months ended  Change
                                          30 June 2006      30 June 2005
Turnover                                 £6.33 million     £5.02 million    +26%
Profit before tax                        £0.82 million     £0.55 million    +48%
Earnings per share - basic and diluted            2.0p              1.4p    +43%
Dividend per share (proposed interim)             0.3p               n/a       -

Highlights:

  • Recurring annualised software revenue increased by 19% to £12.0 million since year end (Dec 2005: £10.1 million)
  • Recurring software revenue in the period of £5.37 million (2005: £4.22 million) represents 85% of total revenue (2005: 84%)
  • Increased operating cash inflow in period and successful share placing in May resulted in increase in net funds to £4.2 million (Dec 2005: £1.8 million)
  • Two acquisitions completed in the period expected to be earnings enhancing in full year
  • Interim dividend of 0.3p per ordinary share declared (2005: nil)

Commenting on the results, Justin Wheatley, Chief Executive of StatPro said: ‘StatPro’s prospects for the second half of 2006 are very positive based upon our current pipeline of business. There is strong demand for our risk and fixed income products and generally the outlook is positive for all our products in all our territories. ‘Regulation, both existing and new, continues to drive growth in our markets. By investing in powerful new software systems, such as StatPro’s, our clients and prospects can mitigate risk on a cost effective and proportionate basis. ‘Given the operational gearing of the business we expect profit margins to improve. Our medium term goal is to achieve at least 20% net operating margins.’

– Ends –

For further information, please contact:

StatPro Group plc

Justin Wheatley, Chief Executive 020 8410 9876
Andrew Fabian, Finance Director

Arbuthnot Securities Limited

Tom Griffiths/Neil Kirkton 020 7012 2000

Smithfield

Reg Hoare 020 7360 4900

A briefing for analysts will be held at 9.15 for 9.30am today at the offices of Smithfield, 10 Aldersgate Street, London, EC1A 4HJ

High resolution images are available for the media to view and download free of charge from www.vismedia.co.uk

About StatPro

StatPro Group plc is a leading provider of portfolio analytics solutions for the global asset management industry. Over the past 12 years, StatPro has developed its products in close collaboration with international asset managers and can offer sophisticated portfolio analytics tools for risk management, fixed income analysis, performance measurement, attribution analysis, GIPS compliance and reporting. StatPro has around 250 client contracts in 25 countries, with 9 offices worldwide. StatPro has grown its annualised recurring software revenue from less than £1 million in 1999 to £12 million today.

CHIEF EXECUTIVE’S REVIEW

StatPro Group plc is a leading provider of portfolio analytics solutions for the global asset management industry with around 250 client contracts in 25 countries. StatPro now offers an integrated suite of six core products and has grown its annualised recurring software revenue from less than £1 million in 1999 to £12.0 million today. StatPro listed on the London Stock Exchange in May 2000 and was admitted to AIM in June 2003. The Company is headquartered in London and has 125 employees.

Highlights

StatPro achieved a solid performance in the first half of 2006 reflecting a significant increase in new business, strong demand for our expanding range of products and a positive market place. Revenue increased by 26% to £6.33 million from £5.02 million in the comparable period in 2005 and earnings per share rose by 43% to 2.0p from 1.4p.

At the heart of StatPro’s business lies its strong recurring revenue model. The annualised value of recurring revenue grew to £12.0 million at 30 June 2006 (June 2005: £9.0 million) up from £10.1 million at 31 December 2005; of this £1.35 million resulted from net new contracts, £0.74 million was derived from acquisitions during the period, and there was an adverse impact of £0.19 million due to currency movements (see table below). The increase in organic recurring revenue since 30 June 2005 (i.e., excluding the recurring revenue acquired) is approximately 23%.

Acquisitions

In the first half of the year StatPro made two acquisitions, both of which are expected to be earnings enhancing this year. Alphai, an Australian business, based in Sydney has become the StatPro Australian office and will help the distribution of all StatPro products in Australia and Asia. We are also using Alphai’s software as the platform for our planned application service provider (‘ASP’) service. Integration of Alphai is focusing initially on the completion of existing development schedules and then later in the year on recruitment of an expanded sales team to promote distribution in the region.

Kizen, a South African company, builds on StatPro’s existing strong presence in that market where the Group now has combined annualised recurring revenues in excess of £1.0 million. Kizen developed a compliance product that we believe will function well when integrated with our risk product (StatPro Risk Management – ‘SRM’) and will allow us to offer our clients faster, more seamless compliance processes. We are currently training our European sales and account management teams in its use and plan to launch the product in Europe in September.

In 2005, StatPro acquired Delve which had developed a reporting solution (now marketed as StatPro Enterprise Reporting) and this product has made excellent progress with annual recurring revenue now standing at £0.47 million up from £0.17 million when we acquired the business. The Delve team is now completely integrated with the London team. Prospects for the product look good and further sales are expected to be made during the second half.

New Business

Sales have been strong in all our regions and across all our products. Sales to new clients have been encouraging with around two thirds of new business being contracted with new clients. Typically, new clients are contracting an average of 2 products each with several contracting for all of the StatPro suite of products.

Sales in North America have improved markedly with new sales in the first half of 2006 more than twice the whole of last year’s achievement. The pipeline looks good for this region and we expect a similar performance for the second half.

The UK region has also performed well with new sales for the first half equal to the level of new business achieved for the whole of last year. The pipeline also looks strong in the UK region with demand for our fixed income and risk products being especially encouraging.

Continental Europe has had another outstanding half year outperforming its excellent achievement for the first half last year and contributed nearly 45% of all new business.

Our risk product, SRM, continues to sell well and we now have 35 clients with annual contract values of £2.22 million up from £1.26 million at 30 June 2005. We now have 15 clients for our fixed income product contributing £0.63 million in annual sales up from virtually nothing twelve months ago and £0.28 million at the beginning of 2006. StatPro Performance & Attribution (‘SPA’) and StatPro Composites are also selling well with 15 new contracts so far this year. These sales performances provide evidence that our strategy of acquiring products and then investing in them is delivering growth.

Regulation in the sector, in particular as a result of Sarbanes-Oxley and UCITS III, is continuing to drive growth, with continued demand for our risk product and other analytics reporting.

Strategy

Our strategy remains to acquire new, but related, products to cross sell to our expanding client base. As our product offering grows, we hope to be seen as a strategic partner by our existing and prospective clients so that when they need portfolio analytic solutions they consider StatPro first.

In addition to this we are seeking to expand our relationships with custodian banks which are increasingly offering integrated outsourcing services to their clients. StatPro now has eight custodian clients globally. Each contract is structured around a minimum fee and a per portfolio fee that increases as the custodian sells to more clients. In this way we can participate in the increasingly significant outsourcing market. We anticipate winning further business from custodians as our software offers a unique combination of precision and scalability, which is backed up by the expertise of our client services’ support team.

The Company has made seven acquisitions since 2000 (the year its shares were first listed). All of these acquisitions have been successfully integrated and are contributing to our strong performance. Our strategy remains to seek and evaluate further potential acquisitions that can enhance earnings through both improvements to our product portfolio and geographical expansion.

Queen’s Award

The Company was delighted to have been awarded the Queen’s Award for Enterprise (2006) in the International Trade category. The Award, announced on Her Majesty’s eightieth birthday, recognises StatPro’s continuous achievement in international trade, resulting in substantial overseas earnings with growth and commercial success, sustained over a six year period since 1999.

Dividend

We paid our maiden dividend of 0.5p per share as a public company on 31 May 2006 and now propose to pay a maiden interim dividend of 0.3p per share on 1 November 2006 to shareholders on the register at the close of business on 6 October 2006.

We intend to maintain a progressive dividend policy reflecting the balance between the investment needs of the business and the growth in underlying cash and earnings per share.

Outlook

StatPro’s prospects for the second half of 2006 look positive based upon our current pipeline of business. There is clear and strong demand for our risk and fixed income products and generally the outlook is positive for all our products in all our territories. Regulations, both existing and new, continue to drive demand in our markets. By investing in powerful new software systems such as StatPro’s our clients can mitigate risk on a cost effective and proportionate basis.

Given the operational gearing of the business we therefore expect profit margins to improve. Our medium term goal is to achieve at least 20% net operating margins.

I would like to thank all the staff of StatPro for their contribution to these very successful interim results and I look forward to reporting continuing improvements on this success.

Justin Wheatley
Chief Executive

FINANCIAL REVIEW

Overview

New business achieved in the first half of 2006 was significantly ahead of the comparative period. The combination of higher levels of new licences and a high retention rate resulted in revenue increasing by 26% over the comparable period in 2005, including 3% from acquisitions. The Group increased its operating profit to £0.79 million (2005: £0.57 million) and increased the net funds position to £4.22 million at the end of June 2006 (June 2005: £1.71 million). Two acquisitions were completed in the period as described in the Chief Executive’s review. The initial cash consideration amounted to £1.41 million (see note 4) of which £0.79 million (initial cash consideration net of cash acquired but before adjustment for net assets) was incurred in the first half. The initial share consideration amounted to £0.77 million, deferred consideration is currently estimated at £2.00 million and goodwill arising amounted to £3.58 million.

Turnover

Turnover increased by 26% to £6.33 million (2005: £5.02 million) including a contribution of £0.17 million from the two acquisitions in the second quarter of 2006. The impact of exchange rates on turnover and profit were immaterial in the period. Software licence revenue grew by 27% and the level of professional services and other revenue increased by 20%.

The split of revenue by type was as follows:

    Six months to   Six months to         Year to
                                         30 June         30 June     31 December
                                            2006            2005            2005
                                       £ million       £ million       £ million
Turnover
Software licences                           5.37            4.22            9.13
Professional services and other revenue     0.96            0.80            1.66
                                       _________       _________       _________
                                            6.33            5.02           10.79

A good level of new business was achieved in the first half in all the markets in which we operate. Our risk and fixed income systems and our reporting solution achieved the fastest growth rate. The value of the recurring revenue for StatPro Risk Management systems increased to £2.22 million by the end of June 2006 from £1.60 million at the end of December 2005. StatPro Fixed Income (‘SFI’), which was formally launched in January 2006, increased recurring revenue to £0.63 million by 30 June 2006 from £0.28 million at 31 December 2005.

The StatPro Enterprise Reporting solution (‘SER’), which was acquired with the Delve acquisition in July 2005, has increased recurring revenue to £0.47 million from £0.27 million at the end of December 2005 and from £0.17 million on acquisition. The two acquisitions completed in the period (Alphai and Kizen) added £0.74 million of recurring revenue.

The proportion by value of recurring software licences on multi-year contracts (licence agreements with more than one year remaining contractually committed) increased to 56% at the end of June 2006 on an underlying basis compared to 53% at the end of December 2005 and 51% at the end of June 2005. Including the impact of the contracts acquired the level was 53%.

The annual value of continuing recurring revenue, which is analysed below, increased to £12.0 million from £10.1 million at 31 December 2005, a growth of 19%. Excluding acquisitions and at constant exchange rates the growth rate was 13% in the six month period.

Annualised value             At 31             New       Contracts   Net impact of             At         Growth rate
                          December      contracted   acquired with        exchange        30 June          (excluding
                              2005    revenue (net    acquisitions           rates           2006  contracts acquired
                                                of                                                    and at constant
                                     cancellations)                                                    exchange rates)
                         £ million       £ million       £ million       £ million      £ million                   %

Recurring revenues
Software licences            10.10            1.35            0.74           (0.19)         12.00                 +13

Operating expenses

Operating expenses (before amortisation of intangibles) amounted to £4.75 million in the first half of 2006 (2005: £3.84 million). The growth in expenses arose mainly from a higher average level of employees (see below), and associated travel and other employee costs. There were also additional costs associated with third party data for risk and marketing as a result of our increased product offering.

Development costs

The Group continues to increase its investment in research and development, to ensure we remain at the forefront of performance and risk analytics technology, including the development of an application service provider (‘ASP’) solution. Development costs are now capitalised under IFRS where recognition criteria are met. As a result there is now an intangible asset of £2.93 million (including acquired intangibles) recognised on the Group’s balance sheet relating to the carrying value of previous developments where the Board expects the benefits to be recovered through incremental revenue from future sales (Dec 2005: £2.31 million). Development expenditure is amortised over a three year period. The carrying values, which are analysed by product, are considered carefully by the Board and if there has been any impairment in any development costs then the carrying value is written down accordingly.

Employees

The average number of employees during the first six months of 2006 increased to 114 (2005: 90). The number of employees has increased from 105 at the start of the period to a total of 125 employees, situated in nine offices (London, Paris, Milan, Frankfurt, Luxembourg, New York, San Francisco, Cape Town and Sydney) at the end of June 2006. 11 employees joined with the acquisitions completed in the period.

Interest

Net interest income, arising from interest earned on cash and deposits less interest and fees accrued on bank loans and finance leases, amounted to £0.04 million (2005: net interest expense £0.02 million) as a result of the increase in net cash during the period.

Profit before tax

The profit before tax increased by 48% to £0.82 million from £0.55 million.

Taxation

Tax amounting to £0.08 million (2005: £0.01 million) has been provided on profits at a rate of approximately 10%, based on the current estimate of the effective tax rate for the Group for the full year. The level of deferred tax asset amounted to £1.46 million (Dec 2005 – £1.52 million). Deferred tax amounting to £0.44 million at end June 2005 has been reclassified as current deferred tax for comparability purposes.

Earnings per share

Earnings per share (basic and diluted) increased by 43% to 2.0p (2005: 1.4p).

Cash flow

There was an improved cash inflow from operations before investment in development activities during the first six months of 2006 amounting to £1.95 million (2005: £1.14 million), which was enhanced by a favourable working capital inflow. The investment in development activities was £0.97 million (2005: £0.81 million). As a result, the cash inflow from operations after investment in development activities increased to £0.98 million (2005: £0.33 million) in the first six months of 2006 (see note 2).

In the light of the various funding requirements pertaining to acquisitions and in order to strengthen the balance sheet the Company placed 3.25 million new ordinary shares at 80p per share in May 2006 with new and existing institutional investors. Net proceeds from the placing and the exercise of employee options in the first half of 2006 amounted to a total of £2.50 million.

Balance sheet

The Group’s net assets increased to £6.92 million at June 2006 (June 2005: £1.89 million) from £3.03 million at 31 December 2005. Goodwill arising on the two acquisitions in the period amounted to £3.58 million (see note 4). The level of trade and other receivables, of which the major component is trade debtors, was lower than the level at the end of December 2005 but increased to £3.60 million at the end of June 2006 compared to last year (June 2005: £2.15 million). The cash balance at the end of June 2006 was £4.25 million (June 2005: £1.78 million). The Group’s net funds at 30 June 2006 amounted to £4.22 million (June 2005: £1.71 million).

The major component of creditors is deferred income, a non-cash liability, which amounted to £6.76 million (June 2005: £5.10 million). The level of deferred contingent consideration is estimated at £2.00 million for the two acquisitions in the period taking the total deferred contingent consideration to £3.50 million at the end of June 2006.

Dividend

StatPro has now generated operating cash for four years. Having initiated a dividend payment policy in 2005, the directors intend to pay a maiden interim dividend of 0.3 pence per ordinary share (2005: nil) on 1 November 2006 to shareholders on the register at the close of business on 6 October 2006. The Board intends to maintain a progressive dividend policy reflecting the balance between the investment needs of the business and the growth in underlying cash and earnings per share.

Andrew Fabian
Finance Director

Group Income Statement

Group Income Statement

                              Notes      Unaudited     Unaudited      Year to
                                     Six months to Six months to  31 December
                                           30 June       30 June         2005
                                              2006          2005
                                             £'000         £'000        £'000
Group Turnover
Continuing operations                        6,156         5,017       10,786
Acquisitions                                   174             -            -
                                            ______        ______       ______
Total continuing operations                  6,330         5,017       10,786

Operating expenses before
amortisation of intangibles                 (4,751)       (3,841)      (7,969)
Amortisation of intangibles                   (793)         (602)      (1,154)

Operating expenses                          (5,544)       (4,443)      (9,123)
                                            ______        ______       ______
Continuing operations                          770           574        1,663
Acquisitions                                    16             -            -

Operating profit                               786           574        1,663

Interest receivable                             44            10           18
Interest payable                                (8)          (30)         (42)
                                            ______        ______       ______
Profit before taxation                         822           554        1,639

Taxation                                       (84)           (9)           -
                                            ______        ______       ______
Profit for the period                          738           545        1,639
                                            ______        ______       ______
(Loss)/profit attributable to
minority interests                              (7)           61           69
Profit attributable to equity
shareholders                                   745           484        1,570
                                            ______        ______       ______
                                               738           545        1,639
                                            ______        ______       ______
Earnings per share from
continuing operations - basic      1           2.0p          1.4p         4.6p
                      - diluted    1           2.0p          1.4p         4.5p

Statement of Recognised Income and Expense

  Unaudited      Unaudited
                                     Six months to  Six months to      Year to
                                           30 June        30 June  31 December
                                              2006           2005         2005
                                             £'000          £'000        £'000
Profit after tax                               738            545        1,639
Net exchange differences offset in
reserves net of tax                             28             11          (81)
                                            ______         ______       ______
Total recognised gains and losses for
the period                                     766            556        1,558
                                            ======         ======       ======
Attributable to:
Minority interests                              (7)            61           78
Equity shareholders                            773            495        1,480

Consolidated Balance Sheet

                                       Notes Unaudited  Unaudited
                                                 As at      As at        As at
                                               30 June    30 June  31 December
                                                  2006       2005         2005
                                                 £'000      £'000        £'000

Non current assets
Goodwill                                         6,632        708        3,053
Intangible assets                                2,931      1,835        2,308
Property, plant and equipment                      528        468          466
Other receivables                                  250        285          174
Deferred tax assets                              1,032      1,032        1,032
                                                ______     ______       ______
                                                11,373      4,328        7,033

Current assets
Trade and other receivables                      3,597      2,145        3,759
Deferred tax assets                                430        440          490
Cash and cash equivalents                        4,254      1,775        1,853
                                                ______     ______       ______
                                                 8,281      4,360        6,102

Liabilities
Current liabilities
Financial liabilities - borrowings                 (35)       (41)         (35)
Trade and other payables                        (2,397)    (1,637)      (1,987)
Current tax liabilities                            (46)        (5)         (26)
Deferred income                                 (6,668)    (5,035)      (6,487)
Provisions - contingent consideration           (1,096)         -            -
                                                ______     ______       ______
                                               (10,242)    (6,718)      (8,535)

Net current liabilities                         (1,961)    (2,358)      (2,433)

Non-current liabilities
Financial liabilities - borrowings                   -        (22)           -
Deferred income                                    (87)       (63)         (75)
Provisions - contingent consideration           (2,404)         -       (1,500)
                                                ______     ______       ______
                                                (2,491)       (85)      (1,575)

Net assets                                       6,921      1,885        3,025
                                                ======     ======       ======
Shareholders' equity
Ordinary shares                                    393        350          350
Share premium                                    3,362        903          891
Other reserves                                     698      1,697          (90)
Retained earnings                                2,525       (893)       1,924
                                                ______     ______       ______
Total shareholders' equity                       6,978      2,057        3,075
Minority interest in equity                        (57)      (172)         (50)
                                                ______     ______       ______
Total equity                                     6,921      1,885        3,025
                                                ======     ======       ======

Consolidated Cash Flow Statement

    Unaudited      Unaudited
                                     Six months to  Six months to      Year to
                                           30 June        30 June  31 December
                                              2006           2005         2005
                                             £'000          £'000        £'000
Cash flows from operating activities
Cash generated from operations               1,949          1,145        3,155
Interest received                               42              7           18
Interest paid                                   (9)            (5)         (13)
Issue costs in respect of bank loan              -             (5)          (5)
Tax received/(paid)                            (34)           (11)         (31)
                                            ______         ______       ______
Net cash from operating activities           1,948          1,131        3,124

Cash flows from investing activities
Acquisition of subsidiaries (net of
cash acquired)                                (790)             -         (858)
Investment in intangible assets -
development costs                             (966)          (813)      (1,738)
Proceeds from sale of property,
plant and equipment                              -             22           22
Purchase of property, plant and
equipment                                     (108)           (87)        (188)
                                            ______         ______       ______
Net cash used in investing
activities                                  (1,864)          (878)      (2,762)

Cash flows from financing activities
Repayment of bank loan                           -         (1,200)      (1,200)
Proceeds from issue of ordinary
shares                                       2,499            564          551
Capital element of finance lease
payments                                         -             (2)          (2)
Dividends paid to shareholders                (180)             -            -
                                            ______         ______       ______
Net cash from/(used) in financing
activities                                   2,319           (638)        (651)
                                            ______         ______       ______

Effects of exchange rate changes                (2)            11           (7)

Net increase/(decrease) in cash and
cash equivalents                             2,401           (374)        (296)
                                            ======         ======       ======
Cash and cash equivalents at start
of period                                    1,853          2,149        2,149

Cash and cash equivalents at end of
period                                       4,254          1,775        1,853
                                            ======         ======       ======

Reconciliation of operating profit to net cash flow from operating activities

  Unaudited      Unaudited
                               Six months to  Six months to            Year to
                                30 June 2006   30 June 2005   31 December 2005
                                       £'000          £'000              £'000

Operating profit                         786            574              1,663
Depreciation of tangible
fixed assets                             110            103                202

Amortisation of intangibles              793            602              1,154
Decrease/(increase) in
debtors                                  289            206             (1,254)
Increase/(decrease) in
creditors (excluding deferred
income)                                  112            (86)               193
(Decrease)/increase in
deferred income                         (177)          (276)             1,130
Share based payments                      36             23                 59
(Profit)/loss on disposal of
fixed asset                                -             (1)                 8
                                      ______         ______             ______
Net cash generated from
operations                             1,949          1,145              3,155
                                      ======         ======             ======

Reconciliation of net cash flow to movement in net funds

  Unaudited      Unaudited
                               Six months to  Six months to            Year to
                                30 June 2006   30 June 2005   31 December 2005
                                       £'000          £'000              £'000

Increase/(decrease) in cash
and cash equivalents in the
period                                 2,401           (374)              (296)
Movement of finance leases                 -             (4)                 2
Bank loan repayment                        -          1,200              1,200
Other non-cash movements                   -             (8)                14
                                      ______         ______             ______
Movement in net funds                  2,401            814                920
Net funds at beginning of
period                                 1,818            898                898
                                      ______         ______             ______
Net funds at end of period             4,219          1,712              1,818
                                      ======         ======             ======

 

Statement of changes in shareholders’ equity

    Share Share premium    Retained      Other     Minority    Total
                                           capital       account    earnings reserves *    interests
                                             £'000         £'000       £'000      £'000        £'000    £'000

At 1 January 2006                              350           891       1,924        (90)         (50)   3,025

Shares issued                                   43         2,471           -        760            -    3,274

Profit for the period                            -             -         745          -           (7)     738

Dividend                                         -             -        (180)         -            -     (180)

Share based payments                             -             -          36          -            -       36

Exchange differences offset in reserves          -             -           -         28            -       28
                                            ______        ______      ______     ______       ______   ______
At 30 June 2006                                393         3,362       2,525        698          (57)   6,921
                                            ======        ======      ======     ======       ======   ======

* Other reserves includes warrant reserve, merger reserve, translation reserve (previously reported in retained earnings) and (as at 30 June 2005 only) non-distributable reserve.

Notes to the interim accounts

1. Basic earnings per share. Basic earnings per share has been calculated based on the profit after taxation and minority interests of £0.74 million (2005 – £0.48 million) and the weighted average number of shares of 36,393,436 (June 2005 – 33,407,258). The diluted earnings per share were 2.0p (2005: 1.4p) based on potentially dilutive shares outstanding amounting to 1,201,501 (2005: 453,970).

2. Cash generated from operations – reconciliation from statutory heading to business performance measure

  Unaudited      Unaudited
                                                                         Six months to  Six months to           Year to
                                                                          30 June 2006   30 June 2005  31 December 2005
                                                                                 £'000          £'000             £'000
Cash generated from operations                                                   1,949          1,145             2,717
Investment in intangible assets - development costs                               (966)          (813)           (1,261)
                                                                                ______         ______            ______
Cash generated from operations less internally generated intangible assets         983            332             1,456
                                                                                ======         ======            ======

 

3. Dividend. An interim dividend for 2006 amounting to 0.3 pence per ordinary share (2005: nil) will be paid on 1 November 2006 to shareholders on the register on 6 October 2006. A final dividend for 2005 amounting to 0.5 pence per ordinary share was paid on 31 May 2006 to shareholders on the register on 28 April 2006. Under IFRS dividends are accounted for when paid and not when proposed or declared.

4. Acquisitions. During the period the Company acquired the entire share capital of two companies, Alphai Pty Limited and Kizen (Pty) Limited. The provisional fair value details and goodwill arising on the acquisitions are as follows:

      Alphai       Kizen       Total
                                                 £'000       £'000       £'000
Share of net assets acquired                        93          54         147
Fair value adjustment                              350         100         450
Goodwill                                         2,120       1,459       3,579
                                                ______      ______      ______
                                                 2,563       1,613       4,176

Initial cash consideration including costs and
adjustments for net assets acquired                793         613       1,406
Initial share consideration                        770           -         770
Deferred consideration - provisional estimate    1,000       1,000       2,000
                                                ______      ______      ______
Total consideration including costs              2,563       1,613       4,176

The fair value adjustments relate to the intangible assets acquired such as acquired technology and client contracts.

5. The financial information set out in this interim statement has been prepared under IFRS on the basis of the accounting policies set out in the statutory accounts of StatPro Group plc for the year ended 31 December 2005. This report is not prepared in accordance with IAS34 which is currently not mandatory. This interim statement has not been audited but has been reviewed by the Company’s auditors PricewaterhouseCoopers LLP.

6. The financial information does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. Statutory accounts for StatPro Group plc for the year ended 31 December 2005 reported under IFRS, on which the auditors gave an unqualified opinion, have been delivered to the Registrar of Companies.

7. Copies of this statement will be posted to shareholders. Further copies are available free of charge on request from the Company Secretary at the Company’s registered office, StatPro House, 81-87 Hartfield Road, London SW19 3TJ.

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