Trading Update

Embargoed Release: 07:00hrs Friday 20th October 2006

                                  SOPHEON PLC                                  

                                  ("Sopheon")                                  

                                TRADING UPDATE                                 

Sopheon, the international provider of software and services that improve the
financial return from innovation and product development investments issues a
trading update.

In addition to delivering on contracts closed during the first half of the
year, we have continued to add further new business. Since the end of June, we
have closed 5 new license orders, and 4 license extensions from existing
customers, in addition to a number of proof-of-concept and other consultancy
assignments. As in the past, these transactions have shown considerable
variation in size and we continue to note that performance in any reporting
period can be materially affected by individual deals. Nevertheless, the
pipeline for closing additional business during the traditionally busy final
months of the year has never been more active; further new sales in this period
will add to contracted and recurring revenue visibility for 2006, which is
already in excess of £5m.

Importantly, one of the recently closed new license orders - which resulted
from collaboration with a leading global IT service consultancy - involves
providing a product portfolio management system to a major automobile company.
Phase one of this project will contribute substantially towards 2006.
Successful completion of this initial phase has the potential to materially
contribute to 2007 and beyond, and together with our signing of Electrolux
earlier this year, will provide a platform for Sopheon's strategy to address
new and exciting vertical markets within the discrete manufacturing industry.

Also of strategic significance but individually at the other end of the
financial scale is our ongoing evaluation of a subscription based sales model
for our software, as noted in our recent interim statement. This program is
aimed at extending our appeal to mid-market companies, and we are pleased to
report our first sale using this model.

Today, in a separate release, we have also announced further developments in
our alliance with Microsoft, describing the planned integration between
Accolade and Office Project 2007. This integration will increase Accolade's
capacity to bring business users and professional project managers together to
increase the success rate, throughput and value of innovation efforts. Sopheon
is an active member of Microsoft's product advisory council for Office Project,
as well as being a Gold Certified partner and a Managed partner.

The high level of activity in our pipeline and the continued growth of our
customer base, taken together with rising interest from business analysts,
trade press and other software vendors, indicate increasing maturity of a
market in which we have a leading position. This gives us confidence in the
outcome of 2006 and beyond.

For further information contact:

Barry Mence, Chairman  Sopheon plc                  Tel : + 44 (0) 1483 685735                       
Arif Karimjee, CFO                                                            
                                                                              
Andrew Tan             Hansard Group                Tel : + 44 (0) 207 245 1100                      
                                                          + 44 (0) 7957 203 685     
                                                                              
Floor van Maaren       Citigate First Financial     Tel : + 31 (0) 205 754 010

About Sopheon

Sopheon (LSE:SPE) is an international provider of software and services that
help organizations improve the business impact of product innovation. The
Sopheon Accolade® system automates gate or phase-based product development
processes and provides strategic decision support that allows companies to
increase revenue and profits from new products. Sopheon is listed on the AIM
Market of the London Stock Exchange and on the Euronext in the Netherlands. For
more information, please visit www.sopheon.com.