Last checked at 1 Apr 2015 07:14
1 April 2015
The Innovation Group
("Innovation Group" or the "Group")
Sale of UK Symbility contracts and Trading Update
- Symbility Solutions Ltd to acquire existing Symbility UK customer contracts -
- New five year SaaS licence agreement signed for global use of Symbility software -
Symbility transaction
The Innovation Group plc (LSE: TIG.L), a global provider of Business Process Services ("BPS") and software solutions to the insurance, fleet, automotive and property industries, today announces the sale of the UK customer contracts associated with its UK Innovation Symbility business to Symbility Solutions Ltd ("Symbility") for a purchase price of £4.0m.
With the current Value Added Reseller ("VAR") agreement between the Group and Symbility coming to an end on 31 December 2015, Symbility approached Innovation Group to acquire the Group's contracted customers using Symbility's software. In line with the Group's strategy to use software of this type as an enabler for service delivery rather than for re-sale, the Group believes it is now appropriate for this software to be managed directly by Symbility Solutions Inc and has agreed to the sale. The purchase price of £4.0m represents full value of the future profits expected from the contracts through to their respective end dates.
As part of a separate agreement, closely aligned to the strategic objectives of both parties, the Group has entered into a five year contract with Symbility for the continued use of the Symbility software as part of the Group's Property service offerings.
Trading Update
Whilst positive progress is being made across the Group, the anticipated 2015 financial impact of some slippage in the signing of a small number of significant UK software contracts, the first of which is the subject of a separate announcement released today, together with benign weather conditions which have adversely impacted claims volumes in our UK property business, will largely offset the positive profit impact from the Symbility transaction.
On the basis that current FX rates persist for the remainder of our 2015 financial year the Board currently anticipate that adjusted profits for the year ending 30 September 2015 will be in line with consensus market forecasts.
Results for the six months ended 31 March 2015 will be announced on 19 May 2015. This will include the comparative segmental analysis for the Business Services and Software divisions.
Commenting on the sale Andy Roberts, Chief Executive Officer of Innovation Group said:
"When Symbility first approached us to terminate our VAR relationship, we were very keen to see if we could realign the relationship towards our strategy as a service provider. This deal allows us to do just that whilst at the same time be fully reimbursed for the future value of the client contracts that we have previously secured: a true win-win approach for us, Symbility and our mutual clients.
Enquiries:
The Innovation Group plc | Tel: +44 (0) 1489 898 300 |
Andrew Roberts, Chief Executive Officer | |
Lewis Miller, Group Finance Director | |
Louise Fisk, Head of Global Communications | |
FTI Consulting | Tel: +44 (0) 20 3727 1000 |
Ed Bridges / Matt Dixon / Rob Mindell |
About The Innovation Group:
Innovation Group (LSE: TIG) is a global provider of insurance software solutions and business process services. With revenues of £209.8m and adjusted PBT of £27.5m in 2014, it employs over 3,000 people across the UK, Europe, North America, Asia Pacific and South Africa and works with 15 of the top 20 global insurance markets, 75% of the top 20 global P&C insurance companies and 3 of the world's top 5 fleet and lease management companies.
www.innovation-group.com