Softcat Regulatory News (SCT)

30 May 2007 13:32

Screen Technology Group plc30 May 2007 For immediate release Screen Technology Group plc Trading Statement Screen Technology Group plc ("Screen Technology" or the "Company"), the AIMlisted designer and manufacturer of revolutionary high resolution large screendisplays for high ambient light environments, announces that it is expectingrevenues for year ended 31 December 2007 to be materially lower than marketexpectations primarily due to delays in funding for its first high speed tilemachine used to manufacture ITrans tiles, and the consequential delay inavailability of its new Modular ITrans product.. The Company however is pleased to announce that it has now entered into a leasefunding agreement with Investec Bank UK ("Investec") for £1.1 million tofinalise the acquisition of its first high speed machine The first high speedmachine is therefore expected to commence production from its new location inWilden's manufacturing facility in Horsovsky Tyn, Czech Republic during thesummer 2007. Screen Technology also announces that a further two high speedmachines are nearing completion, ahead of previous schedule. It is expected thatthese will be brought on stream over the coming year as demand dictates to givea manufacturing capacity at the end of 2007 well in excess of previousexpectations. The Company announced on 27th September 2006 that it had entered into apartnership agreement with Wilden AG ("Wilden"), including a commitment byWilden to fund the acquisition of the first high speed machine. ScreenTechnology also announced on 8th March 2007 that, following the acquisition ofWilden by Gerresheimer Group, Wilden's commitment to provide the funding waswithdrawn. The lease funding facility from Investec now replaces that commitmentfrom Wilden. The Company is pleased to confirm that Wilden's commitment to the projectcontinues and it has invested over £1 million in new mould tools andmanufacturing equipment. Component production is now from two mould tools, upfrom one before Christmas, with a further two mould tools now complete andproducing first off parts. Screen Technology announced on 30 October 2006 a contract to deliver 16 of itsmonolithic displays to Digital Screen Networks ("DSN") for use in VirginMegastores. The Company has been informed by DSN that this contract has beenscaled back to four screens. The Company understands that this decision relatesto internal reasons at Virgin. The existing screens have been operatingsuccessfully in London, Birmingham and Manchester for some time. A fourth screenhas also been recently installed in Glasgow. It is expected that the roll out toVirgin stores will continue at a reduced pace in the coming months and themanagement is in discussions for a similar roll out to another major retailchain. This scaling back has however had a significant impact on revenue for 2006 whichis now expected to be around £700,000. Competition in the monolithic display sector for screens below 100" diagonal isintense and sales have been difficult. The company is concentrating on thesignificant and growing market for larger displays with its modular productwhich can be used to produce seamless displays of 100" diagonal and above. Themodular product is available from the Company and its partner Hantarex and isnow being put into full production with the first customer installationsexpected to be announced over the summer 2007. Commenting on these developments Tom Jarman, Chief Executive stated "Securingthe funding from Investec represents a significant step forward for the Company.Screen Technology is now positioned to pursue its strategy of marketing itsmodular display product which we believe addresses the needs of a growing marketworldwide." Enquiries: Screen Technology Group plc 01223 559600Thomas Jarman, CEOSimon Barton, Finance Director Charles Stanley Securities 020 7149 6000Russell CookHenry Fitzgerald O'Connor This information is provided by RNS The company news service from the London Stock Exchange