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Access Intelligence PLC (ACC)

  Print      Mail a friend       Annual reports

Thursday 06 March, 2008

Access Intelligence PLC

Final Results

FOR RELEASE 7.00AM 6 March 2008

                            ACCESS INTELLIGENCE PLC                            

                    ("Access Intelligence" or "the Group")                     

                       (Software and computer services)                        

                              PRELIMINARY RESULTS                              


                   THE FINANCIAL YEAR ENDED 30 NOVEMBER 2007                   

                                                      2007     2006      Change
                                                      £000     £000            
Turnover                                             4,068    3,677         11%
Operating (loss)/profit before tax, amortisation       (5)      560            
and exceptional costs                                                          
(Loss)/profit before tax                             (478)      246            
Basic (loss)/earnings per share                    (0.41)p    0.12p            
Diluted adjusted (loss)/earnings per share         (0.08)p    0.52p            
Dividends per share                                    Nil      Nil            


  * Results in line with December trading statement
  * Postponed contracts at MS2M held Group back
  * Two other core software and computer services businesses showed good
  * Continued investment in lead products
  * Strong cash position
Current Trading and Outlook

  * New financial year in line with management expectations
  * Management is optimistic about the Group's overall growth potential
  * New sales and marketing management in place
  * Awaiting market reaction to launch of `'
  * No material outflow of cash expected
  * Justifiable reasons for believing that profits can be rebuilt

For further information:

Access Intelligence plc                    01904 520 840

Jeremy Hamer (Non Executive Chairman)

Brendan Austin (Chief Executive)

Colin Davies (Finance Director)

Cubitt Consulting                          020 7367 5100

Brian Coleman-Smith / James Verstringhe Nicola Krafft

Blue Oar Securities                        020 7448 4400

Rhod Cruwys / Shane Gallwey

The Group Today

Access Intelligence is based in York with offices in Stockport, Greater
Manchester, Chorley, Lancashire and Newcastle upon Tyne.

It is a compliance led Software and Computer Services group of companies
providing business critical compliance and legislative driven services to both
public and private sectors.

The software services are provided primarily as Software as a Service (SaaS) on
a recurring revenue basis. Its principal software led services are:

The Virtual Compliance Officer™ which enables companies in the retail financial
services sector to support their customer acquisition process whilst also
ensuring that they comply with ever increasing regulations from the EU and the
FSA.™ a compliance portal which enables companies in the general
insurance and mortgage sectors to risk asses their businesses against FSA
compliance requirements.

ProContract™ a suite of sourcing and procurement software which enables public
sector bodies and private enterprises to demonstrate compliance and
transparency when acquiring goods and services.

ProContract™ streamlines and reduces costs of tendering and contract management
for both buyers and suppliers in the public and private sectors. The government
has the objective that all public sector bodies comply with its directive to
use methods such as electronic tendering for goods and services in order that
it can meet its planned reductions in public spending.

The Group's data management solutions include:

backup & running™ ensures secure encrypted online storage and management of

Starscan™ its anti virus and spam filtering managed service which prevents
companies' servers being brought down by external virus attacks.

Starserver Monitor™ its managed support service which remotely monitors
clients' servers and networks to ensure optimum availability.

The Group's email archiving and high availability storage and retrieval
systems, used by both private and public sectors ensure that information is
available when required in a secure environment. They assist organisations in
their need to comply with initiatives such as Sarbanes-Oxley and the Data
Protection Act.

The Group provides nationwide support services to both public and private
sector organisations in the UK.

                            ACCESS INTELLIGENCE PLC                            

                    ("Access Intelligence" or "the Group")                     

                   (Software and computer services business)                   

                              PRELIMINARY RESULTS                              


                   THE FINANCIAL YEAR ENDED 30 NOVEMBER 2007                   

                             Chairman's Statement                              

I am pleased to announce our results for the year ended 30 November 2007.
Whilst overall the results have been disappointing, we have seen progress in a
number of areas and have used up little of our cash resources with a cash
balance at the year end of £872,000. Adding further critical mass remains
important to our long-term development, however, our share price has restricted
our acquisition activities.


Group turnover was up by 11% to £4.1m (2006: £3.7m). Operating loss before
amortisation and exceptional costs was £5,000 (2006: operating profit £
560,000). Adjusted losses per share were 0.08p (2006: earnings per share
0.55p). In light of this performance, the Group is not proposing to pay a
dividend on the ordinary shares, despite earlier indications to the contrary.

The Year in focus

Having downgraded market expectations during the year these results are in line
with revised estimates. However, notwithstanding the results, our two core
software and computer services businesses have progressed significantly.

Willow Starcom is in data storage and retrieval offering off-line, on-line and
e-mail archiving solutions. Due North offers procurement software solutions as
a service. As a whole these two maturing businesses represent 80% of our sales
at £3.3m (2006: £3.0m).

Willow Starcom had a steady year launching a new e-mail archiving product
towards the end of the period and re-shaping its sales force. During the year
we completed the integration of our new online storage solution and we are once
again building its customer base. We appointed an experienced senior sales
manager at the beginning of this new financial year and are optimistic about
growing profits in this area in 2008.

In the procurement field where our software helps its users reduce the cost and
complexity of procurement, enabling better buying decisions, we have had a
strong year of progress both building our share of the public sector
e-procurement activity and in achieving our first private sector success with
Ladbrokes. Frustratingly, despite winning a number of regional council portals,
we are yet to see the individual councils using the full product suite leaving
considerable revenue opportunities still to be won. The sales team at Due North
has again been strengthened in recent weeks and we have an encouraging pipeline
of opportunity on which we expect to build in 2008.

Our third business, MS2M is more embryonic and had a difficult year. It
continued broadening its product offering, the latest element of which will be
launched in March 2008. Its products help insurance companies, banks, building
societies, insurance brokers and independent financial advisers manage the
FSA's regulations in the area of training and competence. The product to be
launched in March is called™ and is a compliance portal which
enables companies to assess their risk profile against the FSA guidelines for
compliance. Companies using™ complete an online health check and
can be provided with a route map to compliance. If found to be deficient then
MS2M has, in `Virtual Compliance Officer™ and Trackrecord™`, the products to
bridge any gaps. `™' has had a warm reception from the British
Insurance Brokers Association and the Council of Mortgage Lenders. Whilst the
technical qualities of these products are robust, the challenge remains the
generation of demand from the target market. Despite being loss making in 2007,
your board remains convinced that these products more than justify the
investment, time and Group support necessary to achieve market acceptance and
we remain optimistic of a return to profit at MS2M in 2008.

The central costs of a small public company are disproportionately high, often
obscuring profits generated elsewhere in the Group. We have reviewed our costs
in detail this year, consolidating two sites into one and closing a peripheral
office. However, while we constantly strive to minimise central costs, we still
have £350,000 of central overhead to absorb which would obviously be less
significant in a Group with greater critical mass.

Our legacy businesses of The Marketing Guild and Wired-Gov were fundamentally
cash and profit neutral during the year and now absorb minimal management time.
We have had approaches from prospective acquirers for both but no sensible
price has been forthcoming.

Our exceptional costs this year of £126,000 relate predominantly to office
closures and redundancy.

Our business model and strategy

The Group's objective has been to acquire and build businesses providing
software and systems solutions in the areas of compliance and data management.
Your Board is of the opinion that our current share price does not allow us to
continue acquisition activity for the time being unless we can find
opportunities that can be achieved through sensible `relative value' share
swaps, something which we are exploring. In the meantime we continue to build
our business organically whilst preserving our cash. With excellent product
capability, continued product development and an emphasis on customer service,
we believe we have the correct values with which to succeed.

We have broadened the role of the director of the Marketing Guild, so that he
is now closely involved in the Group's marketing activities in conjunction with
strengthening our sales teams. Together these actions give us the resources to
improve our website communication as well as our overall messages to our target
market with the aim of speeding up our organic growth.


Our future prosperity is in large measure dependent on the ability and loyalty
of our staff. Their specialist knowledge and skills are key to providing our
value added services to our customers. Staff turnover is low and we continue to
attract high calibre people.

On behalf of the board I would like to thank our employees for their continued

Current trading and outlook

We have begun the new financial year in line with our expectations. Having
strengthened our sales and marketing management in key areas, we are optimistic
about the group's overall growth potential. With the more embryonic MS2M we
await market reaction to `™', its new product offering. Central
costs are under control and we are not expecting any material outflow of cash
over the year. In summary we have justifiable reasons to believe we can rebuild
our profitability during 2008.

Jeremy Hamer


6 March 2008

                            Chief Executives Review                            

2007 perspective

MS2M, which was acquired in the penultimate month of our 2006 reporting year,
was troubled by major project postponements at two of its larger customers.
This had a damaging effect on its expected contribution for 2007. MS2M provides
compliance software to the retail financial services industry. The company's
software products manage the ever more complex process of ensuring compliance
with Financial Services Authority (FSA) regulations and ever increasing
legislation from the EU. Companies using the software include the Royal Bank of
Scotland Group, National Australia Group, Axa Sunlife and Liverpool Victoria as
well as other blue chip financial services organisations.

Your board still believe that, despite this year's major setbacks, there are
significant opportunities for the company's products and services. We continued
to invest in product development for both existing and new products during 2007
which we believe will bring benefits during 2008 and beyond.

Due North provides strategic sourcing software solutions. During the period
they won the contract to develop the procurement portal for the North West
Centre of Excellence which represents 46 local authorities in the North West of
England. This means that Due North has won three out of the four centres of
excellence that have gone out to tender. There are five yet to do so.
Importantly the company also won a framework contract for all public bodies in
England and Wales. Government agencies can now acquire the Due North suite of
software without having to go through the costly and time consuming processes
of going out to tender.

During the period the second generation e-sourcing suite ProContract™ was
launched. ProContract™, whilst modular in nature, manages the sourcing process
from initial interest through the complete life cycle of the contract including
the management of supplier performance. The new software has been warmly
received by the market and the company had significant wins in the last
quarter. They achieved their first overseas win within central government by
achieving a five year contract with The States of Jersey. Additionally the
company's first private sector customers were added with 3 year contracts at
JANET the UK's education network provider, and Ladbrokes, the leading leisure

The partnership with COA Solutions (previously Cedar Open Accounts) has
continued to bring success with contract wins within the National Health
Service. We continue to look for appropriate partners to broaden our
distribution channels.

In our interim statement, we announced that Willow Starcom was taking action,
including leading its sales proposition with email archiving, to address its
shortfall in sales. These actions brought the expected monthly run rate back on
plan by the year end. They also saw their first public sector sales with
contract wins at Chorley and Sedgefield Borough Councils and Wearside District
Council. Their online backup service Backup & Running™ increased its recurring
revenues by 20%.

The year ahead

The changes we have made to senior management will, we believe, assist in
continuing momentum throughout the year.

The investment in new product development at MS2M has enabled them to launch a
new compliance portal™ . The portal is aimed initially at the
general insurance and mortgage sectors.™ enables companies to risk
assess their business against Financial Services Authority (FSA) requirements.
Easy to use, it audits every part of a business from senior management
arrangements, systems and controls through to training and competence including
treating customers fairly. Companies using the portal are provided with a gap
analysis and a route map to compliance success. Work by the FSA throughout 2007
demonstrated that despite levying fines and cancelling permissions of 151
firms, the standards at mortgage intermediary firms were still well below those

MS2M is currently piloting™ with eleven companies within general
insurance and mortgage broking in conjunction with a cross section of
intermediaries. We believe the outcome from this exercise should generate more
enquiries for MS2M's compliance software as a service offering.

Due North continues to build on last year's success with increased
opportunities in the public sector. Following last year's breakthrough in the
health sector, contract wins have continued and the pipeline here is growing.

A senior head of sales has been appointed to leverage our position in our
existing marketplace and spearhead its entry into the private sector.

The change of sales strategy and investment in senior sales management at
Willow Starcom has had a positive impact on sales revenues.

In spite of disappointing performance in 2007 the group begins 2008 having
invested in stronger sales management, broader marketing resource and a number
of new products.

Brendan Austin

Chief Executive

6 March 2008

                           Finance Director's Review                           

Despite an operating loss before tax and goodwill amortisation of £5,000 we
ended the year with cash balances of £872,000 (2006: £1,002,000), which
reflects strong working capital control by the Group.

The strategy of the group is to focus on companies that have a high element of
recurring revenue. We believe that this will underpin the quality of earnings
and generate strong cash flow. Recurring revenues accounted for 51% of total
revenue at £2.1 million.

International Financial Reporting Standards

As a result of the admission to AIM, the Company will be required in future to
produce consolidated financial statements in accordance with International
Financial Reporting Standards ("IFRS") for accounting periods beginning on or
after 1 January 2007. The group will therefore adopt IFRS for the financial
year ending 30 November 2008, with the first results reported under IFRS being
the interim results for the six months ending 31 May 2008.

The group is committed to achieving a smooth transition to IFRS, and a review
of the effect of the conversion from UK GAAP to IFRS is currently being
undertaken and will be complete by 31 July 2008.

Colin Davies

Finance Director

6 March 2008

                            ACCESS INTELLIGENCE PLC                            

                     CONSOLIDATED PROFIT AND LOSS ACCOUNT                      

                 FOR THE FINANCIAL YEAR ENDED 30 NOVEMBER 2007                 

                                              Note       2007      2006
                                                        £'000     £'000
Continuing operations                                   4,068     3,677
Cost of sales                                         (1,958)   (1,653)
                                                       ______    ______
Gross profit                                            2,110     2,024
Administrative expenses                               (2,115)   (1,464)
                                                       ______    ______
Operating (loss)/profit before exceptional                (5)       560
Non-recurring expenses                         2        (126)        --
                                                       ______    ______
Operating (loss)/ profit                                (131)       560
Amortisation of goodwill                                (355)     (312)
                                                       ______    ______
(Loss)/ profit on ordinary activities before            (486)       248
Interest receivable                                        20        17
Interest payable                                         (12)      (19)
                                                       ______    ______
(Loss)/ profit on ordinary activities before            (478)       246
Taxation                                       3           31     (154)
                                                       ______    ______
(Loss)/ profit on ordinary activities after             (447)        92
                                                       ______    ______
Basic (loss)/earnings per share                4      (0.41)p     0.12p
Adjusted (loss)/earnings per share             4      (0.08)p     0.55p
Diluted (loss)/earnings per share              4      (0.39)p     0.12p
Diluted adjusted (loss)/earnings per share     4      (0.08)p     0.52p
                                                       ______    ______

                            ACCESS INTELLIGENCE PLC                            

                          CONSOLIDATED BALANCE SHEET                           
                              AT 30 NOVEMBER 2007                              

                                              2007              2006
                           Note              £'000             £'000
Fixed assets                                                        
Intangible assets            5               6,691             8,251
Tangible assets                                198               157
                                  ---------------- -----------------
                                             6,889             8,408
                                  ---------------- -----------------
Current assets                                                      
Stocks                                         351               314
Debtors                                      1,156             1,216
Cash at bank and in hand                       872             1,002
                                 ----------------- -----------------
                                             2,379             2,532
Creditors: amounts falling                 (1,582)           (2,101)
due within one year                                                 
                                 ----------------- -----------------
Net current assets                             797               431
                                 ----------------- -----------------
Total assets less current                    7,686             8,839
Creditors: amounts falling                     (2)             (708)
due after more than one                                             
                                 ----------------- -----------------
                                             7,684             8,131
                                            ______            ______
Capital and reserves                                                
Called up share capital                        549               549
Share premium account                        7,906             7,906
Capital redemption reserve                     160                24
Profit and loss account                      (931)             (348)
                                 ----------------- -----------------
Equity shareholders' funds                   7,684             8,131
                                            ______            ______

                            ACCESS INTELLIGENCE PLC                            

                       CONSOLIDATED CASH FLOW STATEMENT                        

                 FOR THE FINANCIAL YEAR ENDED 30 NOVEMBER 2007                 

                                                        2007      2006
                                              Note     £'000     £'000
Net cash inflow from operating activities       6        475       365
                                                       _____     _____
Returns on investments and servicing of                               
Interest paid                                            (2)       (7)
Interest received                                         20        17
Preference dividends paid                               (10)      (12)
                                                       _____     _____
Net cash inflow/(outflow) from                             8       (2)
servicing of finance                                                  
                                                       _____     _____
Taxation                                               (263)      (43)
                                                       _____     _____
Capital expenditure and financial investment                          
Payments to acquire intangible fixed assets             (97)     (332)
Payments to acquire tangible fixed assets              (106)      (69)
                                                       _____     _____
Net cash outflow from capital expenditure              (203)     (401)
and financial investment                                              
                                                       _____     _____

Purchase of subsidiary undertakings                      (4)   (1,708)
Net cash acquired with subsidiaries                        -       818
                                                       _____     _____
Net cash outflow from acquisitions                       (4)     (890)
                                                       _____     _____
Net cash inflow/(outflow) before use of                   13     (971)
resources and financing                                               
                                                       _____     _____
Issue of equity share capital                              -     1,500
Cost of share issues                                       -     (101)
Repayment of loans                                     (136)      (24)
Capital element of leases                                (7)       (5)
                                                       _____     _____
Net cash (outflow)/inflow from financing               (143)     1,370
                                                       _____     _____
(Decrease)/increase in cash                            (130)       399
                                                       _____     _____

                      NOTES TO THE FINANCIAL INFORMATION                       

 1. Basis of preparation and financial information
The financial information in this preliminary announcement has been prepared in
accordance with the accounting policies set out in the financial statements of
Access Intelligence PLC for the financial year ended 30 November 2007 which
have remained unchanged from the financial year 2006.

The financial information in this document does not constitute the company's
statutory accounts for the financial year ended 30 November 2007 or financial
year 2006, but is derived from those accounts. Statutory accounts for 2006 have
been delivered to the Registrar of Companies and those for 2007 will be
delivered following the company's Annual General Meeting. The auditors have
reported on these accounts; their reports were unqualified and did not contain
statements under sections 237 (2) or (3) of the Companies Act 1985.

2. Exceptional costs


The Group has made provision for the costs of closing two offices and making
certain staff redundant. The costs have been disclosed as non- recurring.

 3. Taxation
Analysis of tax charge in the year                    2007        2006
                                                     £'000       £'000
Current taxation:                                                     
UK Corporation tax charge for the year                (45)         143
Prior year adjustment                                  (2)         (5)
                                                   -------     -------
                                                      (47)         138
Deferred taxation:                                                    
Origination and reversal of timing differences          16          16
                                                   -------     -------
Tax (credit)/charge on (loss)/profit on               (31)         154
ordinary activities                                                   
                                                      ____        ____

As shown above, the tax assessed on the (loss)/profit on ordinary activities
for the year is lower/(2006: higher) than the standard rate of corporation tax
in the UK of 30% (2006: 30%). The differences are explained as follows:

Factors affecting tax charge                            2007      2006
                                                       £'000     £'000
(Loss)/ profit on ordinary activities before           (478)       246
                                                     -------   -------
(Loss)/profit on ordinary activities by rate of         (91)        74
tax of 19% (2006: 30%)                                                
Permanent timing differences                              67        87
Depreciation in excess of/(less than) capital              8       (1)
Expenses not deductible for tax purposes                   1         1
Utilisation of loss relief                              (30)      (12)
Adjustment for prior year                                (2)       (5)
Adjustment for marginal rates of tax                       -       (6)
                                                      ------    ------
Total current tax charge                                (47)       138
                                                        ____      ____

Earnings per share

The calculation of earnings per share is based upon the loss after taxation of
£447,000(2006: £92,000 - profit) divided by the weighted average number of
ordinary shares in issue during the year, which was 109,800,999 (2006:
74,703,187). The weighted average number of ordinary shares used in the
calculation of diluted earnings per share is 114,150,999 (2006: 79,053,187).
This has been adjusted for the effect of potentially dilutive share options
granted under the company's share option schemes.

An adjusted earnings per share and a diluted adjusted earnings per share, which
exclude goodwill amortisation, have also been calculated to allow shareholders
to gain a clearer understanding of the trading performance of the Group. This
has been computed as follows:

                                        2007                    2006
               Loss    Weighted    Loss  Profit   Weighted  Earnings
              after average no.     per   after    average per share
                tax   of shares   share     tax     no. of   (pence)
                                (pence)             shares          
              £'000                       £'000                     
Earnings      (447) 109,800,999 (0.41)p      92 74,703,187     0.12p
to ordinary                                                         
Add back        355           -       -     312          -         -
of goodwill                                                         
               ____  __________   _____    ____   ________     _____
Adjusted       (92) 109,800,999 (0.08)p     404 74,703,187     0.55p
earnings per                                                        
               ____               _____    ____   ________     _____
Dilutive          -   4,350,000       -       -  4,350,000         -
effect of                                                           
Diluted       (447) 114,150,999 (0.39)p      92 79,053,187     0.12p
earnings per                                                        
               ____     _______            ____   ________     _____
Diluted        (92) 114,150,999 (0.08)p     404 79,053,187     0.52p
earnings per                                                        
               ____     _______     ___    ____   ________     _____

 4. Intangible fixed assets
Group                      Development costs          Goodwill             Total
                                       £'000             £'000             £'000
At 1 December 2006                       584             8,356             8,940
Additions                                 97                 4               101
Release of deferred                        -           (1,250)           (1,250)
consideration provision                                                         
                                 -----------       -----------       -----------
At 30 November 2007                      681             7,110             7,791
                                 -----------       -----------       -----------
At 1 December 2006                        70               619               689
Charge for the year                       56               355               411
                                 -----------       -----------       -----------
At 30 November 2007                      126               974             1,100
                           ----------------- ----------------- -----------------
Net Book Value                                                                  
At 30 November 2007                      555             6,136             6,691
                                      ______            ______            ______
At 30 November 2006                      514             7,737             8,251
                                      ______            ______ ______           

 5. Reconciliation of operating (loss)/profit to net cash flow from operating
                                                         2007       2006
                                                        £'000      £'000
Operating (loss)/profit                                 (486)        248
Depreciation of tangible fixed assets                      65         56
Amortisation of goodwill                                  355        312
Amortisation of intangible assets                          56         30
Loss on disposal of fixed assets                            -          -
Increase in stocks                                       (37)       (36)
Decrease/(increase) in debtors                             89       (27)
Increase/(decrease) in creditors                          433      (218)
                                                         ____       ____
Net cash inflow from operating activities                 475        365
                                                       ______     ______

Copies of the preliminary announcement are available from the company's
Registered Office at Regency House, Westminster Place, York Business Park,
York, YO26 6RW. The Annual Report and Accounts for the financial year ended 30
November 2007 will be posted to shareholders on or about 20 March 2008.