XCH.L Regulatory News (XCH)

Xchanging plc

Interim Management Statement

Xchanging plc, the global business processing company, today issues its interim management statement covering the period from 1 January 2010 to date.

Current trading

Recent sales momentum has been encouraging but, as previously stated, we expect growth to be weighted towards the second half of 2010 due to the time it takes to conclude deals in these markets.

We continue the active management of our cost base and are on track to deliver the savings we identified in December 2009. The Group's financial position remains strong and our global platform and broad customer base will continue to support profitable growth.

In Global Procurement, we signed a contract to manage £75 million of spend per annum (£375 million of spend over five years) on behalf of CHEP Europe (part of the Brambles Group) covering the UK, France, Germany and Spain.Xchanging will consolidate spend management and help reduce overall non-core procurement costs. The contract includes sourcing of non-core categories and a large proportion of procure-to-pay activities.

In the UK, we continue to see growth from existing customers driven by new implementation programmes and international expansion. We are strengthening our technology offering to provide end-to-end technology solutions, which in turn is driving additional growth to our customer base.

The Americas region has continued to win new business in its technology operations and is on schedule in implementing our new market leading XIAP insurance product at a major customer. In the claims business, we have secured additional work from existing customers and renewed a number of contracts although market conditions remain challenging in workers compensation processing.

In Continental Europe, Xchanging was chosen by VERITAS INVESTMENT TRUST GmbH to administer approximately 100,000 investment accounts. Xchanging continues to lead the consolidation of the independent investment account processing market and will have approximately 1.6 million investment accounts and €31 billion assets under administration by the end of 2010, making it the largest independent investment account processing platform in Germany. Retail securities volumes continue to be weak; however, revenues have been helped by growth in funds under administration. We have completed the migration of accounts acquired from FondsServiceBank onto our investment account administration platform as scheduled. 

In the Asia Pacific region, Xchanging has further expanded the depth and experience of its management team. In April, we appointed William Woo as Managing Director for South East Asia. He will be responsible for growing Xchanging's fledgling business in this market. We have seen an increase in opportunities in the region, which we are confident will contribute towards growth in 2010.

Outlook

We have a strong position in a growing market and are confident that we are well positioned for the future. The markets we operate in generally remain challenging with customers still taking time to make decisions; however, businesses are demonstrating increasing confidence in the economic environment and are now actively engaging in strategic as well as tactical discussions. Based on our trading performance in the first quarter and the actions being taken by the company, we expect to meet market expectations for the full year.

27 April 2010

David Andrews and Richard Houghton will host a conference call foranalysts and investors to discuss this interim management statement at 08:00 BST on Tuesday, 27 April 2010. The conference call telephone number is +44 (0)20 7162 0125, conference ID 864524. For individuals unable to participate in the conference call, a telephone replay will be available until Tuesday, 04 May 2010. Please telephone +44 (0)20 7031 4064 (conference ID 864524).

Xchanging's 2010 half year results will be released on Monday, 2 August 2010.

About Xchanging

Xchanging is one of the largest and fastest growing business processors. With a wide range of multinational customers in 42 countries and employing over 8,000 people, we are a truly global company. Our aim is simply to provide business processing services better, cheaper and faster.

Xchanging provides procurement, accounting, human resources and technology services across industries. These include banking, insurance, manufacturing, retail and real estate among others. We combine functional expertise with deep industry domain knowledge to provide industry-specific outcomes for our customers.

Listed on the London Stock Exchange in 2007, the company is in the FTSE250, the index of mid-capitalised companies traded on the London Stock Exchange. Xchanging is also a member of the FTSE4Good index which measures the performance of companies that meet globally recognised corporate responsibility standards.

www.xchanging.com

Cautionary Statement: 

This announcement contains forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will, may, should, would, could, is confident, or other words of similar meaning. Undue reliance should not be placed on any such statements because they speak only as at the date of this document and, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and Xchanging's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements.

There are a number of factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ materially from those described in the forward-looking statements are; increased competition, the loss of or damage to one or more key customer relationships, changes to customer ordering patterns, delays in obtaining customer approval or price level changes, the failure of one or more key suppliers, the outcome of business or industry restructuring, the outcome of any litigation, changes in economic conditions, currency fluctuations, changes in interest and tax rates, changes in raw material or energy market prices, changes in laws, regulations or regulatory policies, developments in legal or public policy doctrines, technological developments, the failure to retain key management, or the key timing and success of future acquisition opportunities or major investment projects.