SPE.L Regulatory News (SPE)

2 May 2007 07:00

Embargoed Release: 07:00hrs Wednesday 2nd May 2007

SOPHEON PLC ("Sopheon" or the "Company") TRADING UPDATE

Sopheon plc, the international provider of software and services that improve the financial return from innovation and product development investments issues a trading update. The first quarter of the year is traditionally quiet in the software business but we were pleased to record revenues 37% higher than in the first quarter of 2006. In addition to delivering license and service agreements secured in the prior year, we closed a further six license orders of which three were license extensions from existing customers. We also generated revenue from a number of new consultancy assignments. At the end of the first quarter, revenue visibility for the full year from contracted business and recurring revenue streams stood at ‚£3 million, added to which the potential of the sales pipeline remains very encouraging for the coming quarter and beyond. We would continue to emphasize that the timing and size of individual sales can cause variation in our reported results from period to period. Nevertheless, by the end of the first quarter 90 companies had licensed our software, and we expect this ongoing growth in the customer base to drive a rising pattern of repeat business, with continuing improvement in predictability over time.

In our 2006 preliminary statement we outlined our strategic priorities for the coming year. We are pleased to report progress on a range of fronts. As noted above, our customer base is delivering strong levels of repeat business. This is expected to continue, and is reinforced by an ongoing pattern of introducing our software into one or several business units within a large global company and expanding enterprise-wide over time. Customers signed in the first quarter all came from our target markets of chemicals, food and beverage, and consumer goods, as we deepen our market position in these segments. Our emerging relationship with Hewlett-Packard delivered a substantial services extension from the major auto customer we secured last year. Sopheon's initiative aimed at building productive partnerships with consulting firms continued to progress. New levels of interest and activity showed good promise of future sales as we furthered our work with strategic partners on a number of additional business opportunities. Some, like the auto customer, take us beyond traditional markets and territories.

Our product development team is continuing to move forward on its already well-advanced work on the next release of Accolade. At the same time, we are busily preparing for upcoming sessions of our European and North American Product Advisory Councils, which will convene in May. The council groups are comprised of executive-level decision-makers from some of the leading companies in the world, including BASF, Cadbury Schweppes, Campina, Celanese, Cytec, Electrolux, Hospira, Land O'Lakes, Nautilus, Nestle, Parker Hannifin, Verizon Wireless and Timex. A principal value of the impending meetings is that they will help us set market-driven priorities for the development of our Accolade product roadmap for 2008.

Over the last five years we have invested substantial resources in the development of our business, simultaneously driving for annual improvements in financial performance. This led to the achievement of positive EBITDA for the first time in 2006, making it a milestone year for Sopheon. We will continue to balance the needs of driving Sopheon forward strategically whilst staying focused on financial performance. We expect to maintain our established trend of advancement in 2007 and beyond.

For further information contact:

Barry Mence, Chairman Sopheon plc Tel: +44 (0) 1483 685735 Arif Karimjee, CFO Sarah Wharry, Seymour Pierce Limited Tel: +44 (0) 207 107 8000 Nominated Adviser Andrew Tan Hansard Group Tel: +44 (0) 207 245 1100 +44 (0) 7957 203 685 Floor van Maaren Citigate First Financial Tel: +31 (0) 205 754 010About Sopheon

Sopheon is an international provider of software and services that help organizations improve the business impact of product innovation. The Sopheon Accolade‚® system automates gate or phase-based product development processes and provides strategic decision support that allows companies to increase revenue and profits from new products. Sopheon is listed on the AIM Market of the London Stock Exchange and on the Euronext in the Netherlands. For more information, please visit www.sopheon.com.