Mobile Tornado Regulatory News (MBT)

Mobile Tornado Group plc

("Mobile Tornado" or the "Company")

Trading Update

Mobile Tornado (AIM: MBT), the instant communications services provider for mobile devices, announces its trading update for the current financial year.

Current Financial Year Trading

Recurring revenue continued to increase during the period and is now expected to have increased by over 40% for the current financial year when compared to the prior year. Furthermore, by the end of the current financial year, monthly subscribers are expected to have more than doubled over the prior year, reflecting increased adoption rates from key clients.

However, one-off capital expenditure-type revenues have been lower than previously expected as sales cycles have lengthened with many of our prospective customers.

Therefore, despite the increased number of users and recurring revenue, total revenue for the current financial year to 31 December 2014 is expected to be approximately 30% below current market forecasts with a reported loss before tax of approximately £3m.

Outlook

Changes in the management team have already improved account management operations in recent months and our relationships with all our customers is now stronger than they have ever been. We therefore expect to see the continued growth of recurring revenues during 2015 as a result of these efforts. The board also continues to work on a number of large and interesting new client prospects and believes that these contracts will now materialise over the near to medium term.

The Company's new management has also proactively reduced operating costs by approximately £0.8m, on an annualised basis, which is expected to become effective from the beginning of the next financial year.

Furthermore, given the increased level of recurring revenue, the board now has greater visibility over the performance of the Company, which has increased our confidence in our financial performance for next year and beyond.

Jeremy Fenn, CEO of Mobile Tornado, commented "Whilst it is obviously disappointing to report trading in the current financial year is not expected to meet market expectations, I am pleased to report the increasing levels of recurring revenue, which gives us confidence in the future of the Company. I am also encouraged by the positive actions taken by the board to reduce operating costs while simultaneously improving the operating controls within the business.

"The outlook remains positive for the Company as recurring revenue levels continue to increase and we remain focused on closing some significant license deals over the near term. We would also like to thank shareholders for their continued support and remain committed to delivering significant shareholder value."

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About Mobile Tornado

Mobile Tornado Group PLC (AIM: MBT) specialises in the provision of Instant Communications services for mobile devices, with a focus on enterprise workforce management. The Company's main applications comprise Instant Talk, Instant Locate, Instant Alert & Instant Message and are geared towards improving a business's productivity and performance by enabling organisations and workers to connect one-to-one or one-to-many at the touch of a button.

By equipping their workforce with conventional mobile handsets and Mobile Tornado's Instant Communication services, a company can communicate with one or many employees simultaneously, monitor employee locations, and immediately be alerted of major issues. At the touch of a button, they can communicate with employees more efficiently and cost-effectively than would be possible with traditional mobile services or other Private Mobile Radio (PMR) solutions.

Mobile Tornado's patented Internet Protocol Radio Service (IPRS™) technology has been successfully deployed on networks around the world. The suite of IP-based, OMA standards-compliant services provide instantaneous, 'always-on', bandwidth-efficient communications across a range of mobile networks and devices, including compatibility with forthcoming LTE (Long Term Evolution) 4G mobile networks. Both technical and cost performance is superior to many competing services and technologies, with proven success in the current marketplace.