22nd Jan 2010 07:00
For Release at 07.00
Friday, 22 January 2010
STATPRO GROUP PLC
("StatPro", "the Company" or "the Group")
US$4.08 million (£2.5 million) agreement signed with the Johannesburg Stock Exchange
StatPro Group plc (AIM:SOG), the AIM listed provider of portfolio analytics and data solutions for the global asset management industry, today announces that it has signed an agreement with the Johannesburg Stock Exchange ("JSE") for a total consideration of US$4,080,000 (£2.5 million). This follows the JSE's decision to in-source its back office systems development project, a non-core project inherited by StatPro through an earlier acquisition. The proceeds from the agreement will be used to further strengthen StatPro's balance sheet and reduce the Company's debt level to £6.4 million (on a pro-forma basis) from £8.9 million as at 31 December 2009 (2008: £14.6 million).
Background
In October 2006 StatPro acquired FRI Corporation in Canada ("FRI"). One of FRI's existing contracts inherited by StatPro was to develop MSS, a new back office system for the JSE based on FRI's core back office software (Raison and RSL.net). StatPro transferred the development team of this project from Canada to Cape Town and entered into a five year contract with the JSE in April 2008 to develop and support MSS. The annual value of the contract was approximately £1.1 million per annum and the gross contribution was about £0.7 million per annum before indirect costs.
Having reviewed its future requirements the JSE concluded that it would prefer to continue the development and support of MSS in-house rather than maintain development on an out-sourced basis with StatPro. StatPro has therefore agreed to sell the MSS source code (but not Raison) to the JSE for a total consideration of US$4,080,000 (Four million and eighty thousand US dollars) payable in cash, US$4.0 million of which has already been received. The consideration relates to rights to the source code in the bespoke software and various management and IT services related to the project handover. StatPro will provide assistance to the JSE in the transfer of knowledge of MSS over the next 9 months on a cost basis. As the JSE is acquiring the MSS source code, StatPro has no further liabilities and is released of its obligations or warranties in this regard.
Benefits to StatPro
Whilst StatPro has always provided an excellent service to the JSE, and MSS provided a positive financial contribution to StatPro, the project was not core to StatPro's business. StatPro believes that the substantial cash injection resulting from this agreement strengthens its balance sheet as well as further reducing its debt levels.
Commenting on the contract Justin Wheatley, CEO said: "This is a real win-win deal. The JSE has full control of its vital back office project with the security of ownership of the source code while StatPro receives fair compensation for our efforts and Intellectual Property, allowing us to relinquish our responsibility in what is for us a non-core project. We intend to use the proceeds from this agreement to further strengthen our balance sheet and reduce our borrowings."
For further information, please contact:
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StatPro Group plc |
www.statpro.com |
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Justin Wheatley, Chief Executive |
020 8410 9876 |
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Andrew Fabian, Finance Director |
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Cenkos Securities |
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Jon Fitzpatrick / Ken Fleming |
0131 220 6939 |
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ICIS |
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Tom Moriarty / Caroline Evans-Jones |
020 7651 8688 |
About StatPro
StatPro is a leading provider of portfolio analytics and data solutions for the global asset management industry. The Company sells a SaaS-based Analytics and Data platform on a rental basis to investment management companies allowing them to analyse portfolio performance, attribution, risk and GIPS® compliance. StatPro also provides market data and valuation feeds including a Complex Asset Pricing service.
StatPro has grown its recurring revenue from less than GBP 1 million in 1999 to GBP 28.3 million at end June 2009. StatPro floated on the London Stock Exchange in May 2000 and transferred its listing in June 2003 to AIM. The Company has operations in Europe, North America, South Africa and Australia, with approximately 80% of recurring revenues being generated outside the UK.
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