Parity Regulatory News (PTY)

Parity Group plc

Trading Update, 8th January 2013

The Board of Parity Group plc (the Group) is pleased to report that it expects to meet market expectations for the 2012 financial year.

The Board can now look forward to good profitability in 2013 for the first time in some years, resulting from improved cost control and greater concentration on retaining customers and introducing new services in growth markets. The investment programme announced in the 2011 Placing has now completed and through careful cash management the Group has also funded acquisition costs and the pension plan deficit reduction contributions.

Trading

The Resources division increased the number of contractors in place in 2012 by 15% and continues to expand in a competitive market place, with a significant trend towards private rather than public sector work during the year. There has also been a marked increase in the number of permanent placements.

Talent Management made good progress in 2012 winning 14 new clients in England and Wales. Recently the Department for Employment and Learning in Northern Ireland renewed its long-term graduate training contract. Our graduate pre-work training courses are being very well received and reflect the improved job prospects for people who have been through this system.

The Systems division remains stable and produced a good divisional contribution, winning its first new clients for some time recently as well as maintaining long-standing relationships including BAT, who recently awarded a further year's contract.

The Inition acquisition in May 2012 has performed beyond expectations earning for the founders their first year earn-out in only seven months. This exciting first digital media acquisition is a leading UK specialist in 3D scanning & printing, and advanced 3D augmented and virtual reality installations. This has reinforced the Board's confidence in its digital media strategy, of which Systems and Inition together are the founding businesses.

In addition the Group's Techlab initiative recently agreed in principle a joint venture with Royal Holloway, University of London to develop their innovative social media search algorithm.

Current Trading & Prospects

The Board can look forward to 2013 with some confidence from recent trading; even in the current economic climate. We expect 2013 to be a pivotal year with both improved performance and progress on the planned digital media initiatives.

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