Cyanconnode Regulatory News (CYAN)

13 Jan 2009 07:00



Cyan Holdings plc

("Cyan" or "the Group")

Pre-Close Update 

Notification of Final Results

Cyan is pleased to report that the Group has continued to achieve quarter on quarter revenue growth during the year ended 31 December 2008, albeit at relatively low levels whilst the Group completed the final phase of its product development during the period. Cyan will be announcing its preliminary results for the year ended 31 December 2008 in April 2009. 

Product Development Phase Completed

In line with its strategy, over the course of 2008 Cyan completed the development of multiple low cost and low power consumption products that incorporate sophisticated software. These products address the requirements of multiple, fast growing, global markets and have attracted interest from partners including Micrel Inc who are established suppliers in these markets and regard the Cyan products very favourably in enhancing the quality and capability of their offerings. 

Cost Efficiencies Implemented

Capital expenditure on new product development was completed on plan in 2008 and only nominal expenditure is now budgeted for 2009. Furthermore, as a result of entering into fewer new contracts in the second half of 2008 than the management had expected, the board approved and implemented a range of cost cutting measures during the final quarter of the year that will be completed during the first quarter of 2009. These measures are expected to reduce the day to day running cost of the business by 40 per cent which, combined with lower capital expenditure, will result in expenditure reductions in 2009 of more than £2 million. These measures should also enable the Group to conserve cash until it achieves profitability, which is expected in the second half of 2009.

Commercial Developments

Development of new Gateway products for the European and US Markets has now been completed for Zigbee, W-MBus and CyNet RF network standards. As a result, the Group is in a very strong position to implement the commercialisation phase of its programme for these products and is currently negotiating partnerships with leading suppliers of these standards to promote Cyan Gateway products to their customers. In addition, and as a result of these discussions, Cyan has entered into negotiations to implement a sales channel into the North American market.

Cyan's RF products for Automated Meter Reading were significantly enhanced in Q4 with the release of a proprietary ad-hoc mesh networking protocol named "CyNet3". This has out performed existing protocols and taken the Group into a new global market for reducing the energy consumption of street lamps by enabling dimming or on-off switching of individual lamps. Cyan is now engaged in field trials with multiple prospective customers.

Automated Meter Reading products have generated requests for more sophisticated products for Smart Metering, Demand Control, and Usage Monitoring and the Group is now developing software for specific customers and expects to be among the first to offer a range of products that support these next generation requirements. 

Cyan successfully completed the development of a new low cost microcontroller that achieves performance and low power consumption that few established vendors can match. The co-development of this device with CyNet3 is intended to deliver ultra low power RF networking solutions in all of Cyan's target markets. The recently announced Technology and Business Partnership with Micrel Inc will jointly market existing products through a global sales channel for the first time including the USA. The partnership is intended to develop further new products for the North American market that combine Micrel and Cyan technologies to provide industry leading RF Networking products.

Outlook

Cyan enters 2009 with confidence that it has the products for which there is substantial demand and the management team is now in the process of establishing significant partners and sales channels that are active in Cyan's target markets in order to accelerate the revenue growth of the Group. The board remains confident that the Group will become profitable during 2009.

Enquiries:

Cyan Holdings plc

Kenn Lamb, CEO Tel: +44 (0) 1954 234 400

www.cyantechnology.com

Cenkos Securities plc

Stephen Keys/Adrian Hargrave Tel: +44 (0)20 7397 8900

www.cenkos.com

Media enquiries:

Hansard Group

John Bick/Adam Reynolds Tel: +44 (0)20 7245 1100 

Notes to Editors 

Based in Cambridge in the UK, Cyan Holdings plc is a fabless semiconductor company specializing in the development of applications solutions collectively known as "Cy Solved(TM)" which are built upon the company's low powered, configurable eCOG1k and eCOG1x microcontroller chips. 

Cy-Solved incorporates ready to go solutions, software stacks, applications examples, modular software based on easy to use APIs, evaluation boards and production hardware modules from partners, all pulled together through Cyan's free integrated development environment CyanIDE(TM). Cy-Solved can be incorporated as-is into an application but also supports an ability to be easily customised - either way giving users a head start on the road to market. Currently available Cy-Solved applications include RF-Solved, USB-Solved, Ethernet-Solved and Motor Control-Solved. 

The Company was founded in 2002 and listed on AIM in 2005. Cyan Holdings plc operates through the brand 'Cyan'.