Intercede Regulatory News (IGP)

7 Oct 2009 07:00



7 OCTOBER 2009

INTERCEDE GROUP plc

("Intercede" or "the Company")

Trading Update

Intercede, a leading producer of Identity and Credential Management Systems (IDCMS) software, today announces excellent progress in the six months ended 30 September 2009.

Sales for the first half of the current financial year are more than 40% higher than for the comparable period last year. The Directors are also pleased to report that the Company has strongly increased its operating profit before exceptional items during the period.

The growth in sales is especially encouraging, because it is based both on existing customers expanding deployments installed in earlier periods and on new licence sales into new markets for actual end-customer projects. As a result, we are now experiencing a return on the investment made in development and sales efforts in previous years. Our expansion into new sectors and territories is also producing a fresh and immediate stream of revenue. This is evidence of the ongoing strength and viability of Intercede's business model and of a strategy that is being successfully executed. 

Key achievements during the period include:

Maintaining and expanding existing major projects for Lockheed Martin, UK Government, US Federal Government, NHS and others. 

Winning new contracts to supply MyID to customers in Australia, Austria, Czech Republic, Romania, Slovakia, Switzerland and the US.

Deploying MyID systems at a major security printing and smart card manufacturer, at a major Scandinavian bank and within a European government agency.

Adding the US Social Security Administration to Intercede's Federal HSPD-12 customer list. 

Further details will be provided when Intercede announces its Interim Results for the six months ended 30 September 2009, which is expected to take place in December 2009.

The reported period includes exceptional costs for defending a previously reported patent infringement case in the US filed by ActivIdentity Corporation. Intercede's answer and counterclaims deny that its products infringe ActivIdentity's patent and allege further that this patent is invalid and unenforceable. In addition, Intercede has filed counterclaims against ActivIdentity, including alleging violations of US antitrust law. The court recently rejected ActivIdentity's challenge to Intercede's antitrust claims and one basis for a declaration of unenforceability. While the court dismissed other counterclaims alleging fraud, unfair competition, and an additional basis for a declaration of unenforceability, it gave Intercede the right to re-plead those claims with more factual detail. Intercede filed its amended counterclaims on 28 September 2009. Intercede intends to pursue its defence and its counterclaims vigorously. 

Costs and cash collections have also been kept under control throughout the period, as evidenced by a half year cash balance of £3,913,00, compared to £3,711,000 at 31 March 2009 and £1,839,000 at 30 September 2008. The cash position as at 30 September 2009 is thus more than double that of a year ago, notwithstanding the legal costs incurred to date in defending the patent infringement case brought by ActivIdentity and in pursuing the Company's counterclaims against ActivIdentity. 

Richard Parris, Intercede's Chairman and Chief Executive, said:

"Our order book indicates that Intercede is on track to continue our planned growth trajectory for this year and beyond. I am delighted that our sales pipeline is stronger than ever and that a number of our existing larger projects are set to exceed expectations in terms of future growth. In particular our entry into the national identity market is proving to be particularly rewarding while our partnerships with Lockheed Martin, Thales and VeriSign are making continuing and growing contributions to operating profit."

About Intercede 

Intercede is the producer of the MyID® Identity and Credential Management System (IDCMS). Intercede's MyID is the only IDCMS software product that enables organizations to easily and securely manage the identities of people and their associated identity credentials within a single, integrated, workflow driven platform. This includes enabling and managing: secure registration, biometric capture, application vetting and approval through to smart card personalization, issuance and management. Intercede's MyID is being used around the world by large corporations, governments and banks to manage millions of identities for employees, citizens and customers. Notable deployments in the US include 10 Federal Agencies, a programme with Lockheed Martin and two major US financial institutions. In Europe and the Middle East, Intercede's MyID is being deployed in support of government identity, health and corporate employee ID security projects.

Intercede and MyID are registered trademarks or trademarks in the UK, US and/or other countries. 

For more information visit http://www.intercede.com.

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