DICOM Group plc Results Nine Months to 31 March 2006; Record Third Quarter; Adjusted Operating...

BASINGSTOKE, England -- DICOM Group plc ("DICOM Group"), a global leader of Information Capture and Communications (ICC) solutions, today announced financial results for the nine months to 31 March 2006. The Group is pleased to report significant organic growth in all key financial metrics

Financial Highlights

Group results for the nine months:

--Revenue up 19% to GBP 158.2m (FY2005: GBP 133.4m), organic growth of 13%

--Gross profit margins of 42.7% (41.9%)

--Adjusted operating profit of GBP 11.5m (GBP 11.2m)

--Profit before tax of GBP 7.3m (GBP 10.5m)

--Adjusted* earnings per share of 9.3p (9.7p)

--Strong operating cash flow of GBP 20.0m (GBP 11.1m)

Results of ICC Division, representing 88% (90%) of Group adjusted operating profits:

--Turnover up 14% to GBP 116.3m (GBP 102.4m), organic growth of 7%

--ICC own products and services account for 66% (60%) of ICC sales

--Own product sales up 23% (up 17% on a like-for-like basis), services grew 26% (15% on a like-for-like basis)

--Gross profit margins increased to 54.0% (50.6%)

--Adjusted* operating profits of GBP 10.1m (GBP 10.1m)

* Adjusted profit is the profit after adding back the amortisation of intangibles, costs of restructuring and share-based payment charges. Further details are set out in note 3 to the financial results.

Operational Highlights:

--New customer wins with Okle, a German wholesale company, Jordan Kuwait Bank and the Australian State of Queensland

--Acquisition of Learning Computers International GmbH ("LCI") to increase the scope of DICOM Group's intelligent document recognition technology

--Harvey Spencer ranked DICOM Group first in the worldwide software capture market by turnover

--Kofax named Independent Software Vendor Partner of the Year for 2005 by Fujitsu Computer Products of America, Inc.

Disposal of non core business:

--Discontinuing the Samsung General Agency ("SGA") Division with effect from the end of May 2006 to focus more closely on core Information Capture and Communication business

Commenting, Rob Klatell, Chief Executive Officer of DICOM Group said:

"I am pleased to report another strong performance during our third quarter, with a number of new customer wins and a particularly strong cash generation. Our results for the year as a whole continue to be negatively impacted by a weak Q1, but our much-improved results in Q2 and Q3 clearly demonstrate that we are back on track. Q3 saw us increase further our focus on the core Information Capture and Communication market with the acquisition of LCI and the discontinuing of our SGA business. Endorsements from Harvey Spencer and Fujitsu further underline the strong market position we have established and which we continue to build on. We enter the fourth quarter with a clear focus and a promising outlook."

Regarding Prospects, Otto Schmid, Chairman of DICOM Group said:

"We continue to believe that the expansion into the Business Process Automation market provides excellent opportunities for additional growth. Based on the strong Q3 performance, together with the growing sales pipeline, we expect adjusted operating profits for the full year to show an increase compared to last year."