Sondrel Plc Regulatory News (SND)

EMBARGOED 23 October 2014

SANDERSON GROUP PLC

Pre-close Trading Update

"On-target results with growing revenue derived both from mobile applications as well as new customers;

One iota gains biggest order to date worth £400,000"

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 preliminary results for the year ended 30 September 2014, scheduled to be released on Tuesday, 25 November 2014.

The trading results for the year ended 30 September 2014 are in line with market expectations and will show Group revenue in excess of £16 million (2013: £13.80 million) and adjusted operating profit (stated before amortisation of acquisition-related intangibles, share-based payment charges and acquisition-related costs) growing by over 20% to now exceed £2.7 million (2013: £2.22 million). The balance sheet remains strong with a cash balance of just over £6 million at year-end (31 March 2014: £5.07 million; 30 September 2013: £3.66 million).

Sanderson continues to invest in its product and service offerings, which provide customers with sustainable and tangible business benefits often visible within a short timeframe. Order intake has risen by over 10% (on a 'like-for-like' basis) and the value of contracts signed with new customers during the year has risen by more than 15% to £1.9 million (2013: £1.60 million; 2012: £1.46 million). The order book at year-end, of £2.4 million, was 20% higher than at the previous year ended 30 September 2013. The continuous development of the Group's own proprietary products and services has enabled further growth especially in the areas of warehouse automation and solutions which are deployed on mobile devices, such as smart phones and tablets.

One iota, which was acquired in October 2013 has performed very well. One iota is focused on cloud-based, multi-channel solutions accessed via mobile, tablet and in-store devices. The management team has continued to drive growth and One iota has more than doubled revenue and profit when compared to its last full financial year, prior to acquisition. In September, following a successful pilot implementation, One iota secured its largest order to date, worth over £400,000. The order is expected to be installed, delivered and deployed over the course of the current financial year ending 30 September 2015.

Amongst small and medium-sized businesses ('SMEs'), we believe that, to date, business sentiment has continued to show some improvement but prospective and existing customers remain cautious in their outlook. The Board is maintaining its progressive dividend policy and a healthy balance sheet. The Group's strong order book provides the Board with a reasonable level of confidence, at this early stage of the new financial year ending 30 September 2015, that the Group will make further progress.