Preliminary Results for the Year Ended 31 August 2009

24 November 2009

2ergo Group plc
(“2ergo” or “the Group”)

Preliminary Results for the Year Ended 31 August 2009

2ergo is a leading provider of mobile enabling technologies in four key areas: business, entertainment, media and marketing. The Group’s technological expertise and innovative approach has led it to partner with some of the world’s most respected brands, across a broad range of sectors.

The 2ergo Multiserve Platform continues to benefit from many years’ research and development. Its unique set of technologies form the intelligence and billing layer between mobile network operators, the internet and customer facing applications. It integrates voice, data, text, email, video and mobile internet channels, flexibly and seamlessly, to form a powerful yet agile nucleus from which new and innovative mobile solutions can be developed.

The Group is pleased to announce its preliminary results for the year ended 31 August 2009.

	2009 £000	2008 £000	% change
Revenue	22,693	32,565	-30%
Gross profit	10,887	9,769	+11%
Pre-tax profit ⁽¹⁾	3,813	3,446	+11%
EBITDA ⁽¹⁾	4,968	4,104	+21%
Basic earnings per share ⁽¹⁾	9.87p	8.54p	+16%

(1) figures stated before £3.2 million impairment charge in respect of initial investment in Broca plc

Highlights

Gross profit from direct sales and enhanced Business Partner Programme up 26% to £10.1 million, increasing overall gross margin from 30% to 48%, ahead of expectations.

Strategy to reduce exposure to high-volume low-margin wholesale distribution business seeing continuing success.

EBITDA, before impairment of initial investment in Broca plc, up 21% from £4.1 million to £5.0 million.

Americas region reports first profits.

Expansion into Asia and Australia and broadening of product set through acquisitions.

Growing number of global clients.

Market leading product set starting to be rolled out across all regions.

Completed buy-back of 1 million 2ergo shares into treasury, at a cost of £1.4 million.

Cash reserves of £6.4 million at the year end and debt free.

Ideally positioned to reap significant benefits from investment in additional sales, marketing and support resources in order to drive turnover growth across all geographies.

Neale Graham, Joint Chief Executive of 2ergo, commented:

“It is pleasing to deliver yet another set of strong results, particularly over a period of global economic uncertainty. In addition to achieving organic growth, the management team has made great strides globalising and scaling the business by developing 2ergo’s services in targeted geographies, together with the completion of three strategic acquisitions.

“It is also exciting that this year, more than any other, has seen technology start to revolutionise the use of mobile communications; commercial awareness of this has never been higher. With mobile hardware penetration reaching record levels of over 4 billion subscribers worldwide, it is clear that the demand for mobile services over the next few years will undoubtedly follow, and with the broadening of those services and applications the mobile handset is destined to become the “Life-Style and Business Remote Control”.

“The evolution of mobile technology mirrors our original strategy and it is rewarding to see the 2ergo technology, which has been 10 years in the making, really come alive. Now is the time to build on our success, invest in the future, and maximise these global opportunities. There has never been a more exciting time to be in mobile”.

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