Sysgroup Regulatory News (SYS)

1 December 2010

System C Healthcare PLC

("System C" or the "Company")

Trading Update

System C Healthcare plc (AIM: SYS) ("the Company"), a leading provider of information solutions and services to the health and social care sector, is pleased to provide the following trading update for the six months ending 30 November 2010.

The Board is pleased to confirm that System C is continuing to perform in line with expectations set out at the time of the preliminary results statement on 27 September, and the Company remains confident of meeting consensus market expectations for the full year.

Products

Now that many NHS Trusts have been freed from their obligation to buy systems under the National Programme for IT, the anticipated surge in Trust procurements is underway. The company has a growing sales pipeline numbering some thirty Trusts, and is currently bidding on five formal PAS/EPR procurements, five maternity projects, and various other clinical and departmental solutions. Although the timings of these large scale NHS IT contracts can be difficult to predict, several of the procurements we are working on have published completion dates in the current financial year and new product sales are therefore expected to contribute to the Company's second half performance.

The Company announced in November that it had won a significant contract for its flagship Medway product suite from the Ministry of Defence. Under the terms of this contract, the Company will be installing a full hospital-wide system in Camp Bastion, Afghanistan. System C's success in this competitive procurement is a further validation of its 5-year investment in Medway. 

The Company has also consolidated its position in the independent treatment centre market. It has won a contract over the period to supply its Medway PAS/EPR to a new treatment centre being built at the Lister Hospital, Stevenage, while independent provider Care UK has also gone live with the Medway PAS/EPR at six recently-acquired centres.

Liquidlogic, acquired in July 2009, is also experiencing a significant increase in procurement activity in the market for social care products. More competitive procurements have got off the ground in the first five months of this financial year than in the whole of the last.

Liquidlogic has signed a contract with Cheshire West & Chester Council for its PROTOCOL Integrated Adults' System (IAS) and its Integrated Children's System (ICS). It has also announced the sale of PROTOCOL ICS to Bolton Borough Council, and has been named preferred supplier to Gloucestershire CC for its ICS and eCAF software. 

Services

Services revenues have continued to slow down during the interim period as the National Programme for IT loses momentum and public sector budgets come under further review. However, our services capacity and capability is a key selling advantage for our product sales team and we are expecting increases in Medway-related services activity when the first wave of procurements completes.

Dr Ian Denley, CEO of System C, said:

"We began our major investment in the rewrite of Medway in early 2006 in order to be ready when the NHS IT market opened itself up to competition. That time has now arrived. We are in full bids for 5 PAS/EPR contracts, the sales pipelines in both health and social care have never been stronger, and we are delighted to have already won two competitive procurements with Medway.

"As I said in September, we believe these new product opportunities will provide us with increased predictability of revenues in the medium term and an excellent platform for growth next financial year and beyond."

The Company expects to announce its interim results for the six months to 30 November 2010 on 26 January 2011.

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Notes to editors:

System C Healthcare plc (www.systemc.com), specialises in the design and development of clinical patient management and business intelligence software, and provides systems implementation and consulting services to the health and social care sectors. 

System C Healthcare is quoted on AIM, the London Stock Exchange's market for small and medium sized companies.