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Hosted web services pay dividends for the iomart Group Final results show 46% rise in turnover & a £5M operating profit

17th May 2006 · Investor News

Hosted web services pay dividends for the iomart Group Final results show 46% rise in turnover & a £5M operating profit

iomart Group plc (“iomart”), the Glasgow based directory, internet security & web-services business, has today presented its final results for the twelve month period ended 31 March 2006

Financial highlights 

> Turnover £24.3m up by 46% (2005 – £16.6m)

> Operating profit pre-amortisation £5.0m up by 120% (2005 – £2.3m)

> Fully diluted underlying earnings per share pre-amortisation 6.4p up by 88% (2005 – 3.4p)

> Dividend proposed of 3p per share up by 140% (2005 – 1.25p)

> 240,000 customer numbers grown 20%

> Financial director appointed

Nick Kuenssberg, Non-executive chairman, commented, “iomart’s overall improvement was fuelled by excellent performances in the web services sector which serviced 478,000 domain names and 240,000 customers. Ufindus, with its web and directory service, opened a new sales office in Chorley and continued to generate organic growth with over 46,000 businesses. Easyspace, the web-based domain name and hosting business, continued to justify the acquisition in 2004 with very good figures. Netintelligence, the security enterprise business, fell short of expectations but we remain convinced that this end-point security product will satisfy the requirements of the SME market in the short term and the ISP sector in the medium term and will therefore continue to support it with additional resource.”

Nick Kuenssberg also welcomed the payment of a 3p per share dividend and the introduction of a scrip dividend scheme to enable shareholders to receive new ordinary shares instead of cash dividends. “Both of these announcements are in line with the Group’s progressive dividend policy.” he added.

Angus MacSween, CEO, commented: “The past year has been one of continuing progress on all fronts. UfindUs, our directory service where we provide a web and directory presence to the small and micro business sector, has continued to be our main driver of growth. UfindUs is gaining users with over 2 million searches per month being carried out on the directory and an additional 2 million visits per month direct to our customers websites. More and more of our customers are extolling the amount of business that being on UfindUs brings them. Easyspace has had a good year following a period of integration and is now recognised as one of the UK’s leading hosting companies.”

“Netintelligence has continued to make progress although more slowly than anticipated. There is a growing acceptance that as the world goes mobile there is a requirement to defend security at the end point, be it a desktop in a home office or a laptop in a coffee shop. The ISP community has been slow to adopt security products while they remain focused on broadband land-grab at any price, and we have refocused on the SME market via our proven direct sales model. We remain convinced that, with the right sales teams in place and appropriate marketing support, Netintelligence sales will grow significantly."

Commenting on the future for the Group, Angus MacSween stated:” Our three lines of business are all in markets that are real, growing and changing. They also share a technical infrastructure which provides efficiencies and synergies. We own our intellectual property in each line of business and all have high gross margins. All our pricing is now on a recurring revenue model providing increasing visibility of future revenues.” “We look forward to continuing the growth in each of these businesses and will consider opportunities to enhance shareholder value in each of these lines of business through organic growth, acquisition and partnership.”

Finally, it was announced that Richard Logan, aged 49, BA, CA will join the Group as Finance Director.

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