Share price: 112.80p

PRE-CLOSE TRADING UPDATE – YEAR ENDED 31 DECEMBER 2009

19th January 2010

Since the announcement of the Group’s interim results published in early September, there has been a marked pick up in its market research activity from a wide range of domestic and international clients, in addition to continued strength in the core pharmaceutical operation. However, this has been offset by a challenging period for aspects of the Tangible division of the Group, most notably in financial services and certain charity related work where the traditional seasonal pick up in client activity was not as robust as anticipated. The Tangible operations based in Scotland have had a strong year. Total Group revenue is expected to be in the region of £60.0m.

As highlighted in the interim results, the Group’s cost reduction programme continued in the second half. The total cost base in 2009 is expected to be between £4.0m and £4.5m lower than 2008 as a result of reduced headcount and property consolidation, which will give rise to an exceptional cost of around £1.9m.

As a result, the Board anticipates that the Group’s headline profit before tax will be approximately £5.0m.

The Group’s strong cash conversion continued in the second half of 2009, as a result of which the Board expects to report year end net debt of between £11.5m and £12.0m, down from £14.8m on 30 June 2009.

Whilst the Board remains realistically cautious about the current outlook and it is too early to give detailed guidance for 2010, the Group is seeing refreshed levels of spend across major research clients, with pharmaceutical and health related research showing particular strength. The pipeline of research work is significantly stronger than at the same time last year. Therefore, following the substantial reduction in low margin and non-profitable activities, the Group is in a strong position to push for organic growth in 2010.

The Group expects to announce its preliminary results for the year ended 31 December 2009 on Wednesday 17 March 2010.

 

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