Altitude Group Regulatory News (ALT)

17 Jan 2006 07:00

Dowlis Corporate Solutions plc17 January 2006 Date: 17 January 2006 On behalf of: Dowlis Corporate Solutions plc ("the Group" or "Dowlis") Embargoed: 0700hrs Dowlis Corporate Solutions plc Pre Close Trading Statement Dowlis Corporate Solutions plc, the marketing solutions group is today pleasedto provide the market with its first update since the Group's shares wereadmitted to AIM on 7 November 2005. The Group will announce its maiden set ofresults in March 2006. At Admission, the Group stated that trading for the year to date was proceedingin line with expectations; this trend was continued during the final weeks ofthe year. Progress has been made in all four sales channels namely PromotionalProducts where the Group's customers include the AA, Airbus, GlaxoSmithKline,Legal & General and 3; Trade Only, a business that supports over 600distributors and whose the annual trade show takes place this week; InformationServices, the fast-growing provider of industry specific information tosuppliers and distributors; and, Communications, the Group's design andadvertising business. In addition, the Group is pleased to announce the successful outcome ofdiscussions with two third parties, to acquire the Envoy Catalogue fromAdvertising Products Group Limited, and with eCompanyStore. Envoy Catalogue The Group yesterday, 16 January 2006, acquired the business and goodwill ofEnvoy Catalogue, a promotional product catalogue, for a maximum consideration of£200,000. The initial consideration will be paid £100,000 in cash and £70,000through the issue of 147,368 new ordinary shares in Dowlis Corporate Solutionsplc. The deferred consideration of £30,000 will be payable in cash in April2007 subject to the achievement of certain performance criteria. Theacquisition is in line with Dowlis's strategy of providing product informationand selling resources to UK based distributors. The Catalogue features promotional merchandise for corporate customers and issupported by over 60 suppliers with approximately 50,000 catalogues distributedthrough 45 regionally separated distributors. The catalogue group will benefitfrom adopting Dowlis's leading technology for the efficient management ofproduct databases and order processing software as well as the Virtual Sampletechnology that the group has exclusive rights on for the UK market. The acquisition relates solely to goodwill and excludes any additional assets orother balance sheet items. In the year to 30 June 2005, the business had salesof £414,000 and profit before tax for the year was £111,000. The acquisition isexpected to be earnings enhancing in 2006. Application will be made for the new ordinary shares to be issued by way ofconsideration to be admitted to trading on AIM with the first day of tradingexpected to be 20 January 2006. eCompanyStore On 14 December 2005, Dowlis signed heads of agreement to enter into a symbioticpartnership agreement with eCompanyStore ("eCS"), a US-based onlinemerchandising company. Under the terms of the two-year agreement, eCS will act as the exclusivedistributor for Dowlis merchandise in the US and Dowlis will also offer anexclusive reciprocal distribution arrangement in the UK for eCS merchandise.The agreement is expected to provide improved response times for both Dowlis andeCS customers respectively, reducing shipping times, and costs associated withfreight and documentation when goods are transported across the Atlantic. Based in Alpharetta, Georgia, eCS was founded in 1994 under the nameIdus-Howard, changing its name in 1998 to reflect the company's focus on usingwhat was at that time innovative e-commerce technology to provide a moreefficient service. eCS has a largely blue-chip client base, which includesMicrosoft, Bayer and HBO. In the year to 31 December 2004 eCS turnover wasUS$34million. Martin Varley, Chief Executive Officer of Dowlis Corporate Solutions, commented: "The progress that the team has made in such a short time is very pleasing. Aswith many smaller companies, the process of listing on AIM drains much of thesenior resource needed to implement new ideas and grow the business, and I amdelighted that we are now through that process. We are spending our timecontinually looking at ways to innovate additional solutions for customers,identify new markets and opportunities, and take time and cost out of ourprocesses through the adoption of best practice and the use of technology wherepractical. "We look forward to 2006 with much excitement, and have a clear vision of wherewe want to be in the next few years." Enquiries: Dowlis Corporate Solutions plcMartin Varley (Chief Executive) 0870 224 6677 07775 848 252 Redleaf CommunicationsEmma Kane/Miranda Good/Wendy Timmons 020 7955 1410 Corporate Synergy PLCGavin Haywood 020 7448 4450 Zeus CapitalAlex Clarkson 0161 831 1512 Notes to Editors: • Publication quality photographs are available via Redleaf. • Dowlis has an experienced Board which comprises: Colin Cooke, Chairman, who has 21 years' experience as a public company director; Martin Varley, Chief Executive Officer, who has 17 years' experience in the promotional merchandise industry and has gained an extensive knowledge of the supply and distribution sectors of the market; David Gray, Finance Director, formerly finance director of Gowrings PLC for 10 years; and, Keith Willis, Non Executive Director, who recently received a lifetime achievement award from PROMOTA in recognition of his 30 years' contribution to the industry. • It is estimated that the annual UK market for promotional merchandise is £1 billion (source: PROMOTA), which comprises approximately 2,000 distributors supported by 600 UK based suppliers of a wide range of products and services. • The Group currently has four primary sales channels: Promotional Products - the Directors believe Dowlis is the second largest distributor of promotional products in the UK. It sources products from around the World which are then personalised in accordance with the client's brand and design guidelines in support of their wider marketing campaigns. Trade Only(TM) - suppliers to independent distributors via an annual catalogue, exhibition and website. Trade Only(TM) receives orders from approximately 25 per cent of the UK's distributors who access the Trade Only(TM) range which features 600 products all of which are branded to the distributors' specification. Trade Only(TM) has entered into a letter of intent with Technologo to provide Trade Only(TM) and its distributor customers with the opportunity to show their clients branded products on screen before they order. Information Services - a bespoke, industry specific website that contains detailed information on over 1,000 products including full details of the supplier and also detailed product information. Revenue is generated from suppliers wishing to be featured on the website. Dowlis Communications - a design agency based in Manchester, providing a range of services which cover all aspects of design and marketing, including print and brochure production, media planning and buying. It is expected that Dowlis Communications will provide the platform for a number of potential additional services that can be added to the Group's offering as the strategy to focus on marketing services is developed. The Group's offering is underpinned by its investment in software and information technology. Its bespoke sales order processing system and product database was carefully designed to complement the strategy of the Group. The Directors believe that it will provide the Group with a competitive advantage over others in the industry. This information is provided by RNS The company news service from the London Stock Exchange