Last checked at 23 Nov 2007 07:00
23 November 2007 Corero plc ("Corero" or "the Company") Trading update, Contract wins and Board changes
Corero plc, the specialist provider of software solutions to the banking & securities and education markets, updates its 2007 outlook, announces a significant contract in its Financial Markets division, further contract wins in its Business Systems division and changes to the Board.
At the time of announcing our Interim Results for the six months ended June 2007, we anticipated that Corero Business Systems would maintain its performance and that Corero Financial Markets would have an improved second half.
Trading during the second half has improved. The Business Systems division is on track to have its best year ever and we are pleased to announce two further contract wins in the education sector, from Central Sussex College and Epping Forest College.
Central Sussex College has placed an order for our Resource Financials suite and for our Web Requisitioning & eProcurement system. Epping Forest College has placed an order for our new Student Management Information System.
The Financial Markets division has also improved its performance. We are pleased to announce a significant new contract with Blackmont Capital Inc., the investment dealer subsidiary of CI Financial Income Fund based in Toronto, Canada. This contract is for the Blue Curve hosted service and work on the contract is already underway. Blackmont Capital is the second new Financial Markets client to be signed within a month, and the contract represents further progress in developing the large and important North American market.
Despite these improvements, as a result of the slower than anticipated implementation of a major investment banking project, contracted earlier this year, we now anticipate that Corero will make a small operating loss for the second half which, when added to our first half performance, will result in an overall loss for 2007. We now anticipate that the majority of the delayed revenue will be recognised in 2008.
The Board has taken a number of actions to improve the group's performance against an increasingly challenging market environment. Measures have been implemented to reduce costs significantly, in order to achieve profitability in 2008 and at the same time to maintain and enhance customer service and our ability to win business.
Although 2007 will be a disappointing year, we go into 2008 with a significantly reduced cost base, contracted annual licence and support renewals covering approximately 60 per cent. of our costs, satisfactory cash resources, a streamlined management structure, a strengthened North American presence and two divisions that are highly competitive in their chosen markets.
Board Changes
We are also announcing today a change to the Corero Board. Colin Peters, our longest serving non-executive director and former chairman, will stand down on 31 December 2007 after seven years. We thank Colin for his immense contribution to the Company.
Joining the Board on 1 January 2008 as a non-executive Director is Roy Walter Mitchell (aged 51). Roy is a member of the Institute of Chartered Accountants of Scotland and the Chartered Institute of Taxation. He has held senior management roles with organisations such as TI Group, Polygram and Man Group plc. At Man Group plc he sat on the Boards of several subsidiary companies and was a member of the group finance committee and the risk committee. Roy will chair the Corero Audit Committee and be a member of the Remuneration Committee. We are confident that his deep financial knowledge will be an asset to the Company.
During the last five years Mr Mitchell has been a director of MGP 2003, MGP 2001 Employee Benefit Trustee Company, MGP 2002 Employee Benefit Trustee Company, Eastern Sugar Investments B.V., E.D.& F. Man Investments B.V. and Gilt B.V.
Mr Mitchell has a beneficial interest in 2,005,000 Ordinary Shares, representing 4.40 per cent. of the issued share capital of the Company, 175,000 of which are held in the name of his wife, Pamela Mitchell. In addition, he holds ‚£20,000 of Convertible Unsecured Loan Stock 2007 of the Company.
Mr Mitchell has confirmed that there is no further information required to be disclosed under paragraph 17 of the AIM Rules.
ENQUIRIES:Corero plc Peter Waller Tel: 07785 228080 John East & Partners Limited John East/Simon Clements Tel: 020 7628 2200 College Hill Matthew Smallwood/Jamie Ramsay Tel: 020 7457 2020
CORERO PLC