The Company expects to make a trading profit (profit before interest, amortisation of goodwill, exceptional items and taxation) in the second quarter of approximately Â£300,000 (2004 second quarter - loss of approximately Â£350,000). Second quarter exceptional costs amount to approximately Â£175,000, comprising final R&D costs of TradeMark and legal fees for the 'TT' patent issue, which was settled in May 2005.
Trading profit for the half year is therefore expected to be approximately break even compared with a trading loss of Â£782,000 in the first half of 2004.
First half 2005 pre-tax and interest loss (i.e after exceptional items and amortisation of goodwill) is expected to be Â£550-600,000 (2004 first half - Â£ 1,850,000 loss). These major improvements in financial performance are a result of increased revenues combined with a sustained reduction in costs.
Starting in June 2005, the Company has a total cost base (including depreciation and amortisation) of just under Â£3 million per quarter (down from Â£3.7 million in mid-2004) and revenues of over Â£3 million, before launches of new products or new client contracts.
The Company was cash positive during the second quarter and expects to remain cash positive for the rest of the year.
The Directors look forward to the Company moving forward from the sound financial position now established.
The interim results for the six months ended 30 June 2005 are expected to be released in early August 2005.