FST.L Regulatory News (FST)

16 January 2013

Toumaz Limited

Pre-close trading update

Toumaz Limited (AIM: TMZ) ("Toumaz", or "the Group"), announces its pre-close trading update for the year ended 31 December 2012.

The following pro-forma numbers have been prepared as if Frontier Silicon were part of the Group for the full year 2012. Unaudited results prepared on a statutory basis are also included where relevant.

Highlights

·; Digital Radio module and chip sales up 10.3% in a difficult market to 3.2m (2011: 2.9m)

·; Pilot of SensiumVitals disposable digital vital signs monitor in Californian hospital commenced Q4 2012 and is progressing well

·; Completed integration of Frontier Silicon ("FS"), acquired in July 2012. The combined business is taking advantage of complementary technologies and is considerably stronger in key areas of R&D and business operation.

·; Significant progress made on the next generation wireless multi standard Sensium 2 chip development, based on IEEE open standard technology, which targets the health, sports and wellbeing markets

·; Major new wireless chip development programmes also underway for both digital radio and network audio markets.

Full year revenues of £22.3m (2011:£24.8m) are broadly flat when Toumaz non-recurring revenues in 2011 are excluded. On a statutory basis revenues for 2012 will be in the order of £8.5m.

Full year EBITDA loss for 2012 is in the region of £10.9m (2011: £6.1m), the increase in costs resulted from increased investment in new chip development, one off costs of acquiring Frontier Silicon and increased marketing spend to stimulate DAB demand in Germany. EBITDA loss on a statutory basis is likely to be around £9.0m.

The Group commenced a pilot trial of its wireless SensiumVitals in St John's Hospital, California in Q4 2012. Initial results are extremely encouraging with the trial exceeding all of the proof points set for it.

In August 2012, the Group acquired Frontier Silicon, a leading supplier of semiconductor, module and software solutions with a market leading position in Digital radio (DAB) (c80% of digital radios sold in Western Europe are fitted with FS chips) and wireless connected audio. Integration is now largely completed with the new entity benefiting significantly from the Frontier Silicon manufacturing expertise and go-to-market capabilities. Significant technological synergy is being achieved in combining Toumaz's RF and wireless knowhow with Frontier Silicon's digital and software assets and experience. Major synergy across R&D and operations has made the combined business considerably stronger

The Group has continued development of its Sensium 2 chip, a multi standard low power wireless technology including new IEEE802.16.5 and Bluetooth Smart, to address both professional and consumer opportunities.

Important chip development programmes are on-going for both digital radio and network/connected audio markets. The digital radio market growth is expected to accelerate and become main stream as the digital broadcast is increasingly adopted across many countries with some preparing for analogue to digital switch-over. The network/connected audio is a fast emerging market driven by wifi and Bluetooth connectivity at home and consumers' interest in streaming from smart phones, tablets and other connected devices to wireless speakers.

The Group has conducted an impairment review of its intangible assets at the end of the year and believes that as certain of its historical IP is reaching end of life or has been overtaken by new technology, a provision of £10.1m will be taken in the year.

Cash at the end of the period is not expected to be less than £15.2m (pro-forma 2011: £16.5m).

Anthony Sethill, Chief Executive, commented:

"With our market leading position in wireless radio chips, our focus is now on investment in new chip development across our core business units, healthcare (including sport and fitness), digital radio and network audio.

"We continue to prove and roll-out our SensiumVitals healthcare monitoring system. This will be updated with the Sensium 2 integrated circuit which conforms to the latest industry standards for body area networks, as well as Bluetooth Smart.

"The digital radio business will also benefit from a new range of highly-integrated, lower-cost and multi standard chips combining Toumaz and Frontier technologies, and in network audio, a new Bluetooth connected audio module will address the growing demand in the wireless audio connectivity space.

"These R&D projects will strengthen and update our product range, ensuring we maintain our market position and are expected to bring significant revenue growth from 2015."

The Group is hosting a Capital Markets presentation later this morning at which no additional material information will be provided.

Enquiries:

About Toumaz (www.toumazltd.com)

Toumaz is a pioneer in low cost, ultra-low power wireless technologies for a wide range of markets including medical monitoring and internet connected consumer devices. The recent acquisition of Frontier Silicon brings operational scale and expertise together with a leadership position in digital and networked audio markets.