Sondrel Plc Regulatory News (SND)

FOR IMMEDIATE RELEASE 30TH APRIL 2013

SANDERSON GROUP PLC

Pre-close Trading Update

"Continuing Positive Momentum"

Sanderson Group plc ('Sanderson' or 'The Group'), the software and IT services business specialising in multi-channel retail and manufacturing markets in the UK and Ireland, announces the following trading update ahead of the announcement of its interim results for the six months ended 31st March 2013, which are scheduled for release on Wednesday 5th June, 2013.

For the six month period to 31st March ('the period'), the trading results will show revenue growing to almost £6.4 million and profit from operating activities growing by over 10% to around £0.9 million compared with the first six months of the previous year to 31st March 2012 ('last year'). Reflecting a sales mix which includes more Sanderson owned proprietary products and services, gross margins improved to almost 88% compared with 85% 'last year' and 82% in the previous year. During 'the period', pre-contracted recurring revenues rose to £3.96million, representing just over 60% of total revenues. Whilst order intake during the first half has been slower than 'last year', the order book remains strong and sales prospects, going into the second half year, are very good.

Since the year end, Sanderson has not detected any noticeable improvement in general UK economic trading conditions which remain challenging. Uncertainty surrounding the economy affects the confidence of our customers and of prospective customers in making investment decisions. General manufacturing and traditional mail order fulfilment markets remain sluggish, but there are better levels of business activity in the wholesale cash and carry, catalogue, online sales and e-commerce markets. Sanderson also has an established and good presence in the active and growing food manufacturing market where activity levels are high.

Sanderson is continuing to invest in its products and services as well as to innovate with new solutions, especially those deploying mobile technologies, in response to and in anticipation of customer demand. A major furniture manufacturer with retail outlets has implemented the Sanderson mobile sales solution across its stores nationwide. The solution runs on iPads and the touchscreens integrate with the Sanderson Unity Enterprise System, enabling orders to be configured exactly for the customer 'on the spot' and then instantly forwarded to the production department from the showroom, improving efficiency, delivery times and customer service. Order intake for mobile solutions is currently accounting for around 10% of all new business and this percentage is expected to increase further in the future.

Sanderson has a strong balance sheet, is debt-free and continues to convert profit to cash at around 100% with the cash balance at the end of March being £4.5million (31st March 2012: £3.5million). At the AGM, in February, an announcement was made that Sanderson will pay a 1.5p dividend for the coming year. This represents an increase of 25% from 'last year' and a doubling over the last two years. It is expected that the first payment will be a 0.65p interim dividend, payable in August 2013 (August 2012 interim dividend: 0.5p).

The strategy of the Sanderson Board is to achieve growth, both organically as well as by selective, complementary and low risk acquisitions which become earnings and value enhancing. A number of small opportunities continue to be considered. The Board is, however, mindful of the relatively low levels of business confidence and tough UK trading conditions and so continues to adopt a very cautious approach and intends to maintain a strong balance sheet. The strong balance sheet and robust business model coupled with a growing range of products, services and solutions provide the Sanderson Board and management with a good level of confidence of achieving market expectations for the current year to 30th September 2013.

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