5th Mar 2007 07:04
Innovation Group PLC05 March 2007 5 March 2007 THE INNOVATION GROUP PLC AGM Trading Update The Innovation Group ("the Group", LSE: TIG), which provides outsourcingservices and software solutions to the world's insurance providers, announces atrading update ahead of its AGM being held today at 10.00am in Whiteley. The Board is pleased to report that current trading is in line with its growthand profit expectations. The Group's performance will be materially weightedtowards the second half, reflecting a high proportion of incremental revenuecontracted for that period. First Notice Systems Inc, acquired in December 2006, is progressing well andmeeting both volume and integration targets. As announced separately today, the Board welcomes Professor Dr. Kurt J. Lauk andMr James Morley to the Board. The Group intends to announce its results for the half year to 31 March 2006 on22 May 2007. Enquiries: Innovation Group PLC Hassan Sadiq, Group Chief Executive 01489 898 300 College Hill Sara Musgrave/Carl Franklin/Ben Way 0207 457 2020 Notes to editors: The Innovation Group provides outsourcing services and software solutions toinsurers and other risk carriers through its international network of offices.The Group has assembled a portfolio of important assets comprising a set ofsoftware-led business processes for the handling of the breadth of theadministrative processes of insurers and risk carriers, including ''backoffice'' functions such as claims management and sales. The Group's assets alsoinclude software technology for both policy and claims administration that canbe both utilised in connection with the Group's outsourcing operations andimplemented on a stand-alone basis. The Group provides its services on a''non-branded'' basis and does not perform underwriting functions. The Group operates in two principal areas of activity, outsourcing and software,serving insurers and other risk carriers. Since January 2003, The Group hasshifted its focus from software development and licensing to software-enabledoutsourcing. Whilst software continues to be sold independently of outsourcingoperations, it also has an important role in enabling the Group's outsourcingactivities. The most significant expansion of the Group's outsourcing operations has been inSouth Africa where it is currently providing its broadest range of outsourcingsolutions. It has also developed outsourcing solutions in the United Kingdom,Germany and Australia. Following the acquisition of FNS, the Group plans tointroduce outsourcing services in North America. The Group also generatesrevenue from its software operations in each of the four regions it serves:Europe, South Africa, North America and Asia Pacific. The Group has offices in the United Kingdom, Continental Europe, South Africa,Japan, Australia and North America, employing over 1400 people (1,650 peopleincluding FNS). It delivers services for some of the largest insurancebusinesses in the world, including Aviva, Auto Club of Southern California, FordMotor Company of South Africa, Toyota (South Africa), Halifax General Insurance,The Insurance Australia Group, Jaguar Drive Plan (South Africa), AXA Insurance,Sonpo 24 Insurance (Japan) and Zurich (UK). Key market facts: • BPO Market to grow to $110 billion (£57.9 billion) in North America by2009. The growth of the BPO market continues to outpace other IT services. InNorth America, BPO will grow by an 8.8 % compound annual growth rate by 2009.(Gartner 2005) • Due to the high systems maintenance costs of mature insuranceorganisations, only 30% of IT budgets are available for developing new systemsand technologies to improve business support. (Gartner, 2005) • Two of the top five priorities of these insurers are regulatory complianceand cost containment. (Forrester Research, 2005) • 79% of insurers polled are planning to or are currently executing systemconsolidation in the next 12 months to address critical issues. (ForresterResearch, 2005) • Of those planning system consolidation, 55% are planning to address policysystems; 48% are expected to address claims systems. (Forrester Research, 2005) • Claims system replacement is more prevalent in the US P&C insuranceindustry. Research shows that 35% of insurers are assessing this approach versus22% of insurers that are simply renovating their existing system. This trend isbeing fuelled by the advancement in the vendor market and need to deploysolutions rapidly. (Gartner, 2005) This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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