Croma Security Regulatory News (CSSG)

This announcement contains inside information as defined in Article 7 of the Market Abuse Regulations No. 596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

18 February 2019

CROMA SECURITY SOLUTIONS GROUP PLC

("CSSG" or the "Group")

2019 HY Trading Update

And

Strategy for Growth within UK Homeland Security

Croma Security Solutions Group Plc is pleased to announce a half-year trading update together with the Company's strategy for ongoing growth within the UK security market.

2018/19 HY Trading

The six months to 31 December 2018 has been another successful trading period generating revenues and profits ahead of internal expectations at the outset of the financial year, with trading through both divisions benefitting from high demand from both the public and private sectors.

Croma Vigilant, which employs over 1,200 security professionals, to guard assets and individuals, benefitted in the prior financial year from some large one-off contracts which were not expected to be repeated in the current year. However, in H1 this division has continued to win an increasing share of the security market both contracted and shorter projects as institutions opt for Croma Vigilant's premium service resulting in trading being maintained at the record levels achieved in the prior year.

Croma Systems, provider of a range of innovative security technology services including CCTV, Intruder Alarms, FastVein (Biometrics) and high security locks, has also benefitted from good demand across its business activities.

As a result, the Company expects to report for the 6 months to 31 December 2018EBITDA of not less than £1.2 million (2018: £1.2 million).

Strategy for Growth within UK Security Market

Reflecting the real and perceived increases in risk across the UK, security has become a higher priority for both public and private institutions which has substantially increased demand for Croma's innovative client solutions. As a consequence, the Board has been working on the Company's future strategy aimed at maximising this opportunity and further developing Croma's market position within the UK security market through:

· setting new standards in providing premium guarding services, community awareness schemes and innovative front of house solutions under the Croma Vigilant and PROception brands;

· building a national network of Croma Security Centres through which all of the Group's services are sold; and

· becoming the British security brand

The quality of the UK's guarding industry is variable. In the main, guarding is often performed by underpaid, poorly dressed individuals with limited training, a trend being exacerbated currently by sector consolidation. Whereas, Croma Vigilant with its ex-military ethos focuses on providing a premium guarding service performed by well trained, well-motivated individuals directed by ex-military management teams. As security concerns grow generally, demand for these premium services increases and the Group is developing its offering to combine the roles of guarding with front of house services creating a joined-up solution with the potential to transform the way manned security services are delivered in offices, hotels and public institutions.

The key strategic change is the development of a national network of Security Centres. The Board believes there exists a market opportunity to establish a national chain of modern security centres offering a full range of security solutions from CCTV, intruder alarm and advanced security systems as well as high security locks. Last year the Company began the conversion of its seven retail outlets into modern Security Centres which has shown that the format works, enabling the stores to sell the full range of the Group's security capabilities to both domestic and commercial customers.

The Company looks forward to providing more detail on its strategy for growth and this positive trading performance in February 2019 with the announcement of its half-year results which are expected to be announced on 25 February 2019.

Sebastian Morley Chairman of CSSG said:

"We are at an important juncture in CSSG's development. We have a distinct brand known for providing reliable and professional services with an ex-military ethos and significant growth in demand for our services. We have therefore decided to put plans in place to support our aim of becoming the British homeland security brand."

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