FMJ Formjet (See LSE:TQC)

 

TIDMFMJ 
 
RNS Number : 0185M 
Formjet PLC 
21 January 2009 
 

FORMJET PLC 
('FORMJET' OR 'THE COMPANY') 
(AIM:FMJ) 
TRADING UPDATE 
 
 
The Board announced, on 22 August 2008, that it had decided not to proceed with 
a potential acquisition due to adverse due diligence findings. This was a 
difficult decision given that professional fees of GBP150,000 had been incurred. 
Additionally, working towards the acquisition, the Company traded with the 
target and also acquired GBP400,000 of software from the target with a view to 
selling this on at a profit. 
 
 
However, due to concerns over the legitimacy of some of the stock acquired, it 
has been decided to cease marketing of this stock. The Board is exploring 
opportunities but does not believe that it will be possible to realise any 
significant value from the sale of this stock. Accordingly, the Board has made a 
provision of GBP200,000 against the stock's full carrying value. The Board has 
discussed this matter with its legal advisers but, as the target went into 
administration in late 2008, it has been advised that there is little likelihood 
of a recovery. As a result of the administration, the Company has also had to 
write off a debtor balance with the target of approximately GBP140,000. 
 
 
Trading in Q3 to 30 September 2008 was otherwise in line with the Board's 
expectations. However in Q4, which is normally the Company's peak selling period 
and was expected to result in a profit such that the Group would make a profit 
for the year overall, sales were below expectation and the Board expects that 
the Company will make a loss for the year overall. 
 
 
The Directors expect that the sales of both the ASI Ability product range, 
through the growth in popularity of small laptops and netbooks, and the Panda 
Security products, via the expansion in the UK and the Republic of Ireland, will 
deliver the Board's expectations in 2009. 
 
 
As at 16 January 2009, the Company had net borrowings of GBP75,000, excluding 
the use of the Company's invoice discounting facility. 
 
 
ENQUIRIES: 
 
 
Formjet plc 
                 Tel: 01293 848 860 
Lyndon Chapman, Executive Chairman 
Tony Lee, Chief Executive 
www.formjetplc.com 
 
 
Dowgate Capital Advisers Ltd 
   Tel: 020 7492 4777 
Liam Murray, Nominated Adviser 
www.dowgate.co.uk 
 
 
Old Park Lane Capital 
         Tel: 020 7493 8188 
Michael Parnes, Joint Broker 
www.oldplc.com 
 
 
Dowgate Capital Stockbrokers Ltd 
Tel: 01293 517 744 
Neil Badger, Joint Broker 
www.dowgate.co.uk 
 
 
 
 
Notes to Editors: 
 
 
Formjet plc 
 
 
Formjet plc is a UK-based company with a highly distinctive business model. It 
acquires territorial rights to 'alternative' software products, and markets, 
sells, distributes and supports these products in place of the vendor in 
worldwide markets. The strategy has at its heart the proposition that the 
Company can acquire product lines in territories of at least one country without 
the expense of either product development or the creation of IPR. 
 
 
 
 
Alternative Products 
  *  Panda Software (UK) distributes Panda Software antivirus and Internet security 
  products in the UK. With its high margins and recurring annual renewal revenues, 
  Panda is an important contributor to the Group's sales and profitability. 
  *  Ability Software International (ASI) distributes a powerful suite of office 
  products which, as well as being sold under their own branding, form an integral 
  part of the white label opportunities that Formjet is creating. Ability Software 
  International has also developed the ASI Business Software range. This comprises 
  eight titles, which include fully comprehensive office and graphics suites, 
  Internet security, a business plan development application, small business 
  accounting, appointment book management and staff records management software. 
  In September the Company also added a remote access tool called BeAnywhere to 
  this range. Significant growth in 2008 and further growth targeted in 2009. 
 
  *  EdAlive edutainment software has opened up a new and growing market for Formjet 
  and now covers a wide range of core subjects including maths, word skills and 
  spelling. 
 
 
 
Alternative Routes to Market 
  *  Formjet Innovations is the specialist distribution arm of the Formjet Group 
  focusing on its alternative product range and associated alternative routes to 
  market. The focus here is on creating "white label" software, targeting retail 
  and brand leaders of importance. 
 
 
 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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