Re Contract

Sportech PLC 05 January 2006 Sportech's Interactive Gaming Contract with ITV is terminated Sportech PLC ('Sportech' or 'the Company'), announces today that by mutual consent, its interactive gaming contract with ITV has been terminated with immediate effect. The contract with ITV was signed in March 2002 by Sportech to capitalise on the projected growth market of interactive TV betting. Sportech, through Littlewoods Gaming, agreed to supply interactive betting and gaming services linked to ITV programming. The contract has been loss making for Sportech since inception, including an expected operating loss of £4m in 2005 due to low revenues. The termination will result in Sportech eliminating the operating loss in 2006 and avoiding additional potential payments of £22.2m (with pro rata reduction of up to £8.4m as long as the service is not launched on cable) over the remaining three years of the contract. Sportech and ITV will have no further engagement. As a consequence of the termination, the 2005 results are expected to be impacted by an additional exceptional charge of approximately £14m reflecting the write off of payments already made to ITV, related assets and redundancies. The direct cash cost of the termination is expected to be less than £1m. The 2005 results, excluding exceptional charges, are expected to be in line with market expectations. Sportech will focus on profitable business and remains committed to interactive gaming. The Company will update the market about new product launches in early 2006. Ian Penrose, Chief Executive, Sportech, commented; 'Following a thorough review of the business, it has been established that our contract with ITV is commercially unviable. After negotiations with ITV we have ascertained that this position will not change and have agreed to terminate the contract by mutual consent. Given the huge contractual payments due under the contract from February 2006 onwards, we are not prepared to expose the Company to this ongoing liability. 'Sportech will continue to participate in the interactive betting market and we look forward to updating the market about new launches we have in the pipeline early in 2006.' - ENDS - Enquiries Sportech plc Ian Penrose, Chief Executive Officer 0151 288 3561 Gary Speakman, Finance Director 0151 288 3244 Bell Pottinger Corporate & Financial David Rydell / Zoe Sanders 020 7861 3232 This information is provided by RNS The company news service from the London Stock Exchange

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Sportech (SPO)
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