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iomart confident of resurgence

5th February 2003 · Press Releases

IOMART, the Scottish technology firm, is still on track to break into the black this year, with a string of big clients lining up for its NetIntelligence software package.

Despite chronic conditions in the global technology market, the Glagow-based firm has set up a sales office in Germany as part of a tentative overseas expansion.

Its web-hosting business, which sells internet services to small businesses across the UK, is already trading profitably.

Iomart’s business development director Bill Dobbie said: "We want to make it clear that we are a Scottish technology company that’s not going to disappear.

"It is a tough market, there’s no doubt about it, but when we get to break-even we will have achieved something really quite significant. And we will reach break-even, there’s no doubt about that."

Despite its battered share price of just 5p, Dobbie said Iomart will still have almost £4 million of cash left in the business when it turns cash-positive – equivalent to between 8p and 9p per share.

Dobbie said the German expansion was unlikely to deliver any significant sales before the end of the current financial year. But the sales team has laid the groundwork for contract wins later in 2003.

The German operation is in talks with a string of major software houses – thought to include IBM, Computer Associates and German giant Computerlinx – who plan to sell the software on as part of a larger package.

Dobbie added: "Germany is Europe’s biggest market and most of the big players operating in our space don’t really have a presence there.

"But we’re also using it as an example of how a foreign market can fit in with the Iomart business model."

Iomart’s NetIntelligence software is a security package which slots into a company’s computer network to block out viruses and monitor the overall operation of the system.

The firm sold its broadband internet business to Centrica last year in a £2 million deal which cast doubt over the company’s future direction.

But its remaining internet business now has a customer base of about 5,000 SMEs and continues to generate cash.

The web business, operated from a call centre in Lancashire, is now also marketing the NetIntelligence software to its small business client base.


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