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INVU, Inc. (NVU)

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Tuesday 12 April, 2005

INVU, Inc.

Final Results

INVU, Inc.
12 April 2005

Embargoed for release at 7.00am, 12th April 2005

                                   Invu, Inc.

             Preliminary Results for the Year Ended 31 January 2005

Invu, Inc., the document management software provider, announces its preliminary
results for the year ended 31 January 2005.

Financial Highlights

•    Moved into profitability at both an operational and net profit level
•    Turnover up 58% year on year
•    InvuCare recurring revenues increased 47% to £0.53m (2004: £0.36m)
•    Deferred revenues and general provisions up 75% at year end to £0.98m
     (2004: £0.56m)

                                                      Year Ended            Year Ended
                                                     31 Jan 2005           31 Jan 2004
Turnover                                                  £3.15m                £2.00m
Profit / (Loss)                                           £0.61m              £(0.13)m
Less unrealised exchange gains                          £(0.26)m              £(0.08)m
Adjusted profit / (loss)                                  £0.35m              £(0.21)m
Earnings / (loss) per share                                0.64p               (0.36p)
Adjusted earnings / (loss) per share                       0.37p               (0.59p)

Operational Highlights

•   New customer sites up 59% year on year to 482
•   New end users up 156% year on year to 10,291
•   60 additional accredited resellers recruited including key new dealers
    - Evesham, Danwood, Lexmark, Panasonic, Azzurri Communications
•   Repeat sales in the second half included Persimmon, Millfield Group,
•   Balance sheet strengthened by fund-raising of £0.74m
•   First sale of Intelligent Processing Engine ('IPE')

Daniel Goldman, Non Executive Chairman of Invu, said:

'This has been an excellent year for Invu, characterised by sustained revenue
growth and maiden annual profits. Beneath the headline performance there has
been significant growth in the recurring and deferred revenues, which is central
to our strategy for long-term profitable growth and gives me great confidence in
Invu's future.'

David Morgan, Chief Executive, added:

'We have made a number of key developments during the year: we launched our new
branding and achieved an initial sale of our IPE in its beta format, continued
to improve our sales channel both in quantity and quality and also strengthened
our sales and marketing team throughout the year.  The demand for our products
continues to be very robust and we are still only scratching the surface of the
SME market.'


Invu, Inc.                                                         01604 859893
Daniel Goldman, Non Executive Chairman
David Morgan, CEO
John Agostini, CFO

Financial Dynamics                                                 020 7831 3113
James Melville-Ross
Juliet Clarke

Chairman's Statement

This year we have seen very strong revenue growth accompanied by initial annual
profits. The Group has fulfilled all its aims for the year which, in addition to
the maiden profits, includes further development of our sales channel, a
strengthened balance sheet, and investment in sales and marketing. All of this
enables us to look forward with optimism as we continue to build on our success.

Turnover rose 58% year on year. This growth, with the continued high gross
margins, enabled the Group to record its maiden profit. Trading continues to be
strong both from new and existing customers. InvuCare revenues (annual
maintenance contracts) have risen by 47% to £0.53m whilst deferred revenues and
provisions have increased by 75% to £0.98m. These figures include a 76% renewal
rate for InvuCare contracts beyond the first year.

In 2003 we focused our attention on increasing the number of accredited
resellers, however, this year the key task has been to improve the quality of
the reseller channel.  In addition, the Group continues to invest in research
and development, resulting in the successful launch in 2004 of new versions of
the core products, including one major and one minor upgrade. As ever, all new
products adhere to our brand values of ease of use, high quality and price

Following on from the admission to AIM in January 2004, the Group raised a
further £0.74m in November 2004. The proceeds of this fundraising will
be used to invest in sales and marketing. The continued pace and quality of
reseller sign-ups gives us confidence in our ability to generate significant,
repeatable and profitable revenues in the future.

Building on the success of last year, and with the dual focus on expanding
Invu's marketing reach and enriching the product offering, we expect this year
to be just as exciting, with strong growth in all of the key areas of our
business. As usual, we would expect a strong weighting to the second half.

On behalf of the Group, I would like once again to thank our employees,
accredited partners, shareholders and advisors, without whom none of the success
is possible. I look forward to yet another very exciting year.

Daniel Goldman
Non Executive Chairman

Chief Executive's Statement


Trading this year has been extremely encouraging, once again showing significant
growth during the second half. All of the key performance indicators have
improved during the period, including the number of resellers up to 138, total
customer sites of 1,283, and total number of end users now 24,088. All these
factors have contributed to the Group's substantial improvement in trading in
the second half of the year.

We have consolidated our position within the SME channel through a successful
strategy of accrediting new and better quality resellers, while at the same time
discontinuing accreditation for a small number of less productive resellers. The
strong brand names who have joined as Invu resellers this year further
vindicates our product offering and has substantially increased our potential
market reach within the UK and Holland.

Demand for our products remains strong and throughout the year an average of 40
new customers have installed Invu products each month (not including S100), in
comparison to 25 per month during the previous year.

Financial Performance

Turnover for the period was £3.15m (2004: £2.00m), an increase of 58% on the
prior year. Recognised recurring revenues from InvuCare increased from £0.36m in
the previous year to £0.53m in the year ended 31 January 2005. In addition a
further £0.28m of InvuCare revenue was deferred into the current financial year.

Gross profit margin improved slightly to 94.8% of turnover (2004: 94.3%).  This
is well in excess of our internal benchmark of 92%, and reflected a slight
change in product mix.

Technical and support expenditure, which includes research and development, was
£0.53m for the year (2004: £0.48m). We continue to maintain an active
development programme, covering upgrades of core products and product
innovations. It is the Group's policy to direct research and development
according to the needs of the market, and to ensure that every new product
adheres to our core brand values of ease of use, high quality and price
performance. It is important to note that we adopt the policy of writing off
research and development costs as and when they occur.

Sales and marketing expenditure increased by 66% to £0.98m (2004: £0.59m), or
31% of turnover (2004: 30%).  This reflects the Group's requirement to invest in
sales and marketing in order to increase both turnover and brand recognition.
The bulk of this increase reflects a larger sales team and focused PR and
marketing programmes. It also includes a one-off expense incurred as a result of
the successful launch of the Group's new branding and website.

General and administrative expenses (excluding exchange gains) were £0.90m
during the period compared with £0.77m for the previous year. This 17% increase
reflects the investment in the administrative infrastructure in terms of
personnel, systems and premises and is now only 29% of turnover (2004: 39%).

Operating profit this year amounted to £0.61m (2004: loss £1.02m).

The net profit after tax amounted to £0.61m (2004: loss £0.13m), giving earnings
per share of 0.64p (2004: loss 0.36p). Net profit after tax adjusted for the
unrealised exchange gain is £0.35m (2004: loss £0.21m).

The Group's balance sheet has been further strengthened by a net £0.71m of
additional capital raised in November 2004 and the profit for the year. The bulk
of the proceeds will be used in further investment in sales and marketing with a
small amount be invested in a new accounts and CRM system. This implementation
will be completed in the next few months.

I am pleased to report that debtor days as at the year end have been reduced to
87 days (2004: 111 days). This number is still likely to fluctuate in the future
due to the Group's continued rapid growth. However, this will be tempered by the
recruitment of more established resellers which pay based on more advantageous
terms to the Group.

Creditors (excluding accruals and deferred revenue) of £0.82m (2004: £1.54m)
were covered 4.5 times by current assets (2004: 2 times covered). At 31 January
2005 shareholders funds had nearly doubled at £2.24m compared to £1.18m at 31
January 2004.

The Group is virtually debt free and therefore effectively ungeared as at 31
January 2005.

Taking into account the ongoing investment in the business and accumulated
losses to date, the Board cannot recommend the payment of a dividend.



During the past year we have again seen an improvement in all areas of the
business. The Group has accredited 60 new resellers and has also continued to
grow existing customer sites through the selling of extra licenses and new
products. InvuCare recurring revenues represent a growing proportion of invoiced
sales, although the Group's revenue recognition policy means that a high
percentage is deferred to the following year. At 31 January 2005 the value of
deferred InvuCare revenue was more than double that of the previous year at
£0.46m (2004: £0.18m).

Contract Wins

This year has seen both a number of exciting new customers, and growth of
existing installations. The customer base now includes Numis Securities,
Connaught Plc, Racal Acoustics, Anglia Housing, Dimension Data, Menzies Hotels,
amongst many others. There have been some excellent repeat sales as well to
Persimmon, Millfield Group (following their acquisition of InterAlliance) and

We continue to successfully sell to the financial services market, this year
adding mortgage brokers as they are now regulated by the FSA. In the second half
we started to see the results of our investment in marketing within the
financial and professional services market with press releases, case studies and
articles published in leading trade publications.

In addition to Invu's other traditional markets, e.g. construction and
logistics, certain new markets have been targeted successfully, such as the
accounting profession. We will continue to identify and target specific market
segments where we believe our product offering is most compelling. These are
supported by a growing number of reference customers in vertical markets
including education, legal, retail, housing associations and engineering,
amongst others.

Reseller Channel

The reseller recruitment programme has been very successful once again. Exciting
wins for Invu this year include Evesham Technology, Danwood and Azzurri
Communications in the UK, with Panasonic and Lexmark signing up in Holland.
Lexmark is not itself an accredited reseller, but is partnering with Invu in
approaching its dealer base in order to market a Lexmark/Invu solution. Both the
Panasonic and Lexmark relationships are at an early stage. Nevertheless, we are
pleased with progress in executing marketing messages to their respective large
customer bases in Holland. Hence, we expect these relationships to contribute
sales growth this year.

It is worth mentioning that many of our existing resellers in the UK have
performed very strongly this year and among them Lindenhouse continues to grow
particularly rapidly, whilst Scanworx have firmly established themselves as the
leading reseller to the accountancy sector. Copifax have also emerged as a
significant office systems reseller with The Content Group continuing to achieve
success in the construction vertical.

In addition to our existing channel of resellers we have started a programme of
partnerships with other vendors and resellers more oriented to the business
solutions market, which has not traditionally been exposed to document
management. An example of this would include Draycir, an award winning Sage
partner with lead products specialising in document distribution.

Overseas Markets

Holland continues to be the only foreign market in which the Group is active.
Growth in Holland was in line with the growth of the Group. Already, a vertical
market strength is emerging in that territory with sales to Broekman and
Seatrade, two large specialist shipping and freight groups.

Following the introduction of Version 6 of the core Invu product, the Group can
start planning the penetration of further overseas markets including other
territories within continental Europe, as localisation becomes a more simple
process. This will be on an opportunistic basis in the first instance, where we
feel that the local partner can add significant value over time.

Research & Development

We are delighted with the performance of the product in the market place.
Version 5.4 of the core product range has been released and has proven very
successful. Codefree integration continues to be a significant factor in our
sales success selling on average to about 50% of customers. We are expecting to
complete the conversion of our core products to the .NET operating environment
this year, which will give our products greater longevity and easier translation
to foreign languages.

Of particular note, are the Group's significant advances in the area of
artificial intelligence. A beta version of the Invu Intelligent Processing
Engine (IPE) was released prior to the year end with the signing of our first
paying customer for this technology. This product can be utilised in many
different guises to automate repetitive and time consuming clerical tasks. The
Group expects a full product launch of the first of a series of products this
year, based on the core technology currently in its beta phase.


This year has seen very strong growth in all areas of the business and the new
financial year has started very strongly.

Our positioning within our chosen market has resulted in Invu developing into
the lead brand for document management software in the UK's SME market and it is
our intention to consolidate and leverage this position during the coming months
and years. The exposure that we have created for Invu and document management is
helping to grow the still infant market place for our solutions and we are very
excited about the growth prospects for the Group.

We have a strong, loyal and growing customer base, and they are serviced and
supported by a stable, intelligent and highly motivated team of staff at Invu.
Given the strong progress that Invu has made in 2004/5 and its future prospects,
I am confident that 2005/6 will be another very successful year for the Group.

David Morgan
Chief Executive Officer


                                                         Note                         2005          2004
                                                                                     £'000         £'000

Turnover                                                                             3,149         1,997

Cost of sales                                                                        (165)         (113)

Gross profit                                                                         2,984         1,884

Distribution costs                                                                   (223)         (182)

Administrative expenses                                                            (2,149)       (2,720)

Operating profit/(loss)                                                                612       (1,018)

Net interest                                                                           (4)         (359)

Profit/(loss) on ordinary activities before taxation                                   608       (1,377)

Tax on profit/(loss) on ordinary activities              2                               -         1,251

Profit/(loss) for the year transferred from reserves                                   608         (126)

Earnings/(loss) per share
Basic & diluted                                          3                           0.64p       (0.36p)


                                           Note                         2005                        2004
                                                         £'000         £'000         £'000         £'000

Fixed assets
Intangible assets                                            -                          17
Tangible assets                                            152                         141

                                                                         152                         158

Current assets
Stock                                                      151                         182
Debtors                                                  2,678                       1,296
Short term deposits                                          -                         425
Cash at bank and in hand                                   894                       1,122

                                                         3,723                       3,025

Creditors: amounts falling due
within one year                                        (1,635)                     (1,993)

Net current assets                                                     2,088                       1,032

Total assets less current liabilities                                  2,240                       1,190

Creditors: amounts falling due
after more than one year                                                   -                         (8)

Net assets                                                             2,240                       1,182

Capital and reserves
Called up share capital                                                    -                           -
Share premium account                                                  6,269                       5,562
Profit and loss account                                              (4,029)                     (4,380)

Shareholders' funds                        4                           2,240                       1,182


                                                         Note                         2005          2004
                                                                                     £'000         £'000

Net cash outflow from operating activities               5                           (254)         (470)

Returns on investments and servicing of finance
Interest paid                                                                         (25)         (126)
Interest received                                                                       22             1
Hire purchase interest paid                                                            (1)           (5)

Net cash outflow from returns on investments
and servicing of finance                                                               (4)         (130)

Capital expenditure
Purchase of tangible fixed assets                                                     (83)          (65)
Sale of tangible fixed assets                                                            -            34

Net cash outflow from capital expenditure                                             (83)          (31)

Management of liquid resources
Receipt from/(purchase) of short term deposits                                         425         (425)

Net cash inflow/(outflow) from management of liquid                                    425         (425)

Issue of shares                                                                        736         3,000
Issue costs paid                                                                      (29)         (620)
Receipts from borrowings                                                                 -           567
Repayments of borrowings                                                           (1,005)         (324)
Capital element of hire purchase payments                                             (14)          (57)

Net cash (outflow)/inflow from financing                                             (312)         2,566

(Decrease)/increase in cash                              6                           (228)         1,510



The preliminary announcement has been prepared in accordance with applicable
accounting standards and under the historical cost convention.

The principal accounting polices of the group have remained unchanged from those
set out in the group's 2004 annual report and financial statements.


The tax credit represents:

                                                                                       2005         2004
                                                                                      £'000        £'000

Adjustment in respect of prior year:
Overseas taxation                                                                         -       (1,251)

Total current tax                                                                         -       (1,251)

                                                                                       2005         2004
                                                                                      £'000        £'000

Basic earnings/(loss) per share
Profit/(loss) for the financial year                                                    608        (126)

                                                                                       2005         2004
                                                                                     Number       Number

Weighted average number of common shares in issue during the year                95,228,582   35,440,330

Basic earnings/(loss) per share                                                       0.64p      (0.36p)

Diluted earnings/(loss) per share                                                     0.64p      (0.36p)

The basic earnings per share is based on the profit after taxation of £608,000
(2004 - loss of £126,000) and on the weighted average number of shares in issue
during the year of 95,228,582 (2004 - 35,440,330).  The diluted earnings per
share is based on a diluted average number of shares of 95,505,473 (2004 -
35,440,330), the dilution resulting from share options.

                                                                                       2005         2004
                                                                                      £'000        £'000

Profit/(loss) for the year                                                              608         (126)
Exchange differences                                                                  (257)            79

                                                                                        351          (47)

Issue of shares in year                                                                 707         2,510
Conversion of debt to equity                                                              -         2,809

Net increase in shareholders' funds                                                   1,058         5,272

Shareholders' funds at 1 February 2004                                                1,182       (4,090)

Shareholders' funds at 31 January 2005                                                2,240         1,182

                                                                                       2005         2004
                                                                                      £'000        £'000

Operating profit/(loss)                                                                 612      (1,018)
Depreciation and amortisation                                                            89          863
Profit on disposal of fixed assets                                                        -          (7)
Decrease/(increase) in stock                                                             31        (107)
Increase in debtors                                                                 (1,382)        (306)
Increase in creditors                                                                   653          130
Exchange differences                                                                  (257)         (25)

Net cash outflow from operating activities                                            (254)        (470)

                                                                                       2005          2004
                                                                                      £'000         £'000

(Decrease)/increase in cash in the year                                               (228)         1,510
Net cash outflow/(inflow) from financing                                              1,005         (243)
Net cash outflow from hire purchase contracts                                            14            57
Net cash (inflow)/outflow from (decrease)/increase in liquid resources                (425)           425

Change in net funds from cash flows                                                     366         1,749
Conversion of debt to share capital                                                       -         2,298
Effect of foreign exchange changes                                                        -           179

Movement in net funds in the year                                                       366         4,226
Net funds/(debt) at 1 February 2004                                                     519       (3,707)

Net funds at 31 January 2005                                                            885           519

                                                              At                                               At
                                                      1 February                                       31 January
                                                            2004          Cash flow                          2005
                                                           £'000              £'000                         £'000

Cash at bank and in hand                                   1,122              (228)                           894
Debt                                                     (1,010)              1,005                           (5)
Hire purchase contracts                                     (18)                 14                           (4)
Short term deposits                                          425              (425)                             -

                                                             519                366                           885


The consolidated profit and loss account, consolidated balance sheet,
consolidated cash flow statement and associated notes are unaudited and have
been extracted from the group's financial statements. These financial statements
have not yet been delivered to the Registrar, nor have the auditors reported on

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