MAIS.L Regulatory News (MAIS)

08 February 2017

blur Group plc

("blur Group", the "Group" or the "Company")

Q4 2016 Quarterly Business Update

First 12 month subscription to Group buyer plan taken up by Top 100 UK-based law firm

blur Group plc (AIM:BLUR), the market-leading Indirect Spend Management Platform, today releases key metrics for Q4 2016, a period that saw the first subscription to blur's subscription based Group buyer plan together with further improvements to EBITDA, operating costs and cash burn. FY 2016 EBITDA is expected to be ahead of expectations.

Q4 2016 highlights:

· First 12 month subscription to Group buyer plan taken up by a Top 100, UK-based law firm

· Increased volume of orders placed from Enterprise* customers following Q3 seasonal dip

· Fifth consecutive quarter of improved underlying cash burn - down by 10% to $0.9 million in Q4 2016, from $1.0 million in Q3 2016 (excluding R&D tax credit and foreign exchange movements)

· Cash at the end of Q4 2016, including unrealised foreign exchange movements, was $2.5 million (£2.0 million)

· Operating costs reduced by 10% compared to Q3 2016 - down by 43% compared to Q4 2015

· blur 6.0 platform development completed

· FY 2016 EBITDA expected to be ahead of expectations

*blur defines the Enterprise as a business with 50 or more employees

During Q4 2016, blur saw the first subscription to its 12 month Group buyer plan. Purchase of this plan provides blur's customer, a Top 100 UK law firm, with access to blur's Marketplace of over 65,000 vetted suppliers.

blur saw an increase in volume of Enterprise orders Pitching On following the summer's seasonal slow down and Brexit-driven decline in Q3 2016. While the average value of these orders remains relatively low, blur's management view this increased volume, alongside the take up of the Group buyer plan, as evidence of early momentum in our Enterprise market, that we expect to develop through 2017 and beyond.

We continue to focus on platform sales to large Enterprises that include:

Top 100 UK-based law firm; In Q4, blur saw the first subscription to a Group buyer plan from this new customer. This one year subscription allows the customer to transact an annual spend value of up to $2 million through blur's platform. The Company is currently working with this customer on a significant multiple six figure order, the successful completion of which, will bring greater efficiency and improved value to our customer's business.

UK listed enterprise, aerospace engineering; As reported in blur's Q3 2016 business update, the roadmap with this customer conforms to the Group's expectation of long sales cycles when working with Enterprise clients. blur remains engaged with this Group and continues to work towards a 2017 roll out of blur's platform addressing both Goods and Services across all Indirect spend categories.

Global enterprise, sportswear retailer; blur continues to work with this corporation on an initial pilot due to launch in 2017. Initially operating in one trial geography, blur is seeking to complete a pilot phase which, if successful, could lead to a wider global rollout. Again, the sales cycle is consistent with a large Enterprise platform sale.

Global enterprise, electronics/technology; blur continues to work closely with senior management at this Group, aiming to successfully conclude the pilot phase which could lead to a wider roll out of blur's platform.

In addition, blur completed the development in Q4 2016 of its 6.0 platform. Key features of blur 6.0 include:

· Goods added to the platform giving blur's customers a comprehensive Indirect Spend Management platform

· Features to exceed Enterprise customer expectations including:

· Multi-user account management

· Enhanced reporting

Enhanced automation of supplier shortlisting and selection via blurSenseTM

Financial update

For the fifth consecutive quarter, blur has seen its focus on larger, Enterprise accounts drive improvements to EBITDA, operating costs and cash.

The Group's cash balance at the end of Q4 2016 totalled $2.5 million (£2.0 million) compared to $3.6 million at the end of Q3 2016.

blur's reported cash balance was impacted by $1.2 million of unrealised exchange losses in 2016 and $0.2 million of unrealised exchange losses in Q4 2016, as the valuation of blur's cash balances were further affected by the decline in the GBP:USD exchange rate.

On a constant currency basis for 2016, cash (predominately held in GBP) would be valued at $3.1 million at the end of Q4 2016. This is slightly ahead of analyst forecasts.

Excluding these exchange movements, the cash burn for the quarter was $0.9 million, down from $1.0m in Q3 2016.

blur's operating efficiency improved again, driven by further process improvements in the blur 6.0 platform. These resulted in a reduction in operating expenses of 10% in Q4, compared to Q3 2016 and by 43% compared to Q4 2015.

Philip Letts, blur Group CEO, commented:

"We're delighted to announce the first Enterprise to subscribe to our Group buyer plan. This 12 month subscription plan gives our customers access to over 65,000 high quality, vetted suppliers of both Goods and Services and delivers the ability for them to transact up to $2 million of purchases annually through our platform.

"blur is now working closely with this new customer; initially on a large, multiple six figure order where we are seeking to transform a critical component of their business.

"While this deal has been several months in the making, this subscription is a key milestone for blur as we see a significant Corporate working with blur to transform its Indirect spend through adoption of our platform.

"We continue to see evidence that the wider market is bringing greater focus to the Indirect spend problem. This is demonstrated by the marked increase in volumes of Enterprise orders placed with blur in Q4 and the take up of our Buyer plan subscription by a potentially significant customer. We believe this marks the start of increasing Enterprise volumes for blur, throughout 2017 and beyond.

"We continue to engage with targeted prospects, seeking out corporates and public bodies that have recognised the level of waste and potential fraud in their organisations.

"I'm also pleased to record the fifth consecutive quarter of EBITDA, cost and cash burn improvement. When we transformed blur's strategy in 2015 we anticipated significant efficiency gains in our business. Those gains have been delivered.

"blur's board and management team will remain focussed on cost and cash control. We will also seek to capitalise on the growing market momentum, by widely demonstrating how blur's platform delivers a unique solution to Indirect spend for organisations.

"We look forward to further platform subscriptions and Enterprise roll outs as blur progresses on its path to profitability.

"Finally, I would like to thank Richard Bourne-Arton for his service to blur. Richard leaves our board as of 31 January 2017 after over five years with the Group. Following the strengthening of blur's board in 2015, Richard's continued support to the Group has been invaluable."

This announcement contains inside information.

For further information, please contact:

blur Group plc investors@blurgroup.com

Tim Allen Tel: +44 (0) 1392 927 618

Shaun Dobson/James White N+1 Singer

Tel: +44 (0) 20 7496 3000

Alistair de Kare-Silver/Felicity Winkles Yellow Jersey PR

Tel: +44 (0) 7825 916 715

About blur Group plc at blurgroup.com

Since 2010, blur Group has been helping enterprises worldwide eliminate waste and inefficiency in their indirect procurement process through its market leading Indirect Spend Platform & Marketplace. To date over 65,000 businesses, including companies like, Tesco, Danone, Trinity Mirror, and PwC, have used blur's platform to either buy or sell goods and services online submitting over $500m of requirements to blur Group's platform.

blur Group is a public company listed on the London Stock Exchange's AIM market (BLUR) and is headquartered in the UK with regional sales offices in the US and Europe.