TPA Triplearc

RNS Number:7278R
TripleArc PLC
26 September 2005


26 September 2005

                                 TripleArc Plc
                          ("TripleArc" or the "Group")

                                Financial Update

Following his appointment as Chief Financial Officer in July 2005, Richard
Hodgson was instructed by the Board of TripleArc (the "Board") to undertake a
detailed review of the Group's financial systems, procedures and budgets.

In completing this review it has been determined that a number of financial
reporting errors arose during the integration of Access Plus and the
implementation of the Group-wide financial reporting system. Approximately #1
million of costs were misallocated between the 2004 and the 2005 financial
periods which has resulted in a material overstatement of profitability in the
Company's accounts for the year ended 31 December 2004 (the "2004 Accounts").
The Board has concluded that the 2004 Accounts will require restating and
expects that the restated earnings before interest, taxation and goodwill
amortisation ("EBITA") will be #3.5 million (EBITA reported in the 2004
Accounts: #4.5 million).

The Board is confident that this issue has been fully investigated and that the
Group has appropriate financial systems and controls in place.

However, as a further consequence, current year budgets were inflated as they
were based on inaccurate base data. In addition, summer trading in the data
fulfilment division has been particularly difficult this year and, as a result,
the Board has revised downwards its expectations for the current year. EBITA for
the year ending 31 December 2005 is expected to be approximately 50 per cent of
the restated 2004 comparable, significantly below current market expectations.

The Group's results for the six months ended 30 June 2005 are being released on
30 September 2005 and will show growth in both revenue and gross profit over the
comparable period in 2004. Operating profit, however, has been impacted by
additional costs incurred from investment in contract management, business
development and infrastructure throughout the Group.

As announced in the AGM statement on 28 June 2005, the Group's overhead base
has been comprehensively reviewed. Annualised cost savings of approximately
#1.25 million have already been realised and further gains are anticipated prior
to the year end.

Underlying cash flows remain stable and adequate for the Company's needs. The
Board is confident that the Group retains the support of its lenders.

Chris Pople, Chairman of TripleArc, commented:

"The Board is extremely disappointed at having to issue further bad news to the
market at a time when it can see genuine positive momentum building as a result
of the Group's strategy of focusing on the provision of contracted outsourced
print management solutions.

In the six months to 30 June 2005 contracted revenue increased by 65 per cent
on the same period in the previous year. Over the past 12 months the Company has
secured in excess of #10m of additional annual contracted revenue at encouraging
margins. There is also a strong pipeline of contract sales.

The Board continues to believe that the fundamental underlying strengths and
future growth prospects of the Company are good."

                                    - ends -

For further information please contact:

TripleArc Plc                                                    0117 933 1006

Jason Cromack / Richard Hodgson

Weber Shandwick Square Mile                                      020 7067 0700

Terry Garrett / Nick Dibden




                      This information is provided by RNS
            The company news service from the London Stock Exchange

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