Confirmation of contract win

20 February 2012

Escher Group Holdings plc ("Escher" or the "Group")

Confirmation of contract with United States Postal Service

Escher, a world leading provider of outsourced, point of sale software to the postal industry, is pleased to confirm that the significant contract win announced on 8 February 2012 was with the United States Postal Service (USPS).

USPS awarded Escher Group the contract to provide Riposte licensing, maintenance and services as part of their Retail System Software (RSS) project.

The contract, which has a 54 month base period and renewal options, is expected to generate, over a fifteen-year term, approximately US$50m in revenue for the Group, but with scope for substantial additional revenue. The first revenue from this contract win, worth approximately US$4m, is expected in the year ending December 2012, with increasing revenue in 2013 as the software is rolled out across the network.

Commenting on the contract win, Liam Church, Chief Executive Officer of Escher, said: "We are delighted that after a detailed tendering process, the USPS chose Escher Group. Winning this contract, from one of the world's largest postal authorities, confirms Escher's position as the leading supplier of postal transaction messaging technology in the world today."

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About Escher

Escher is a world leading developer and provider of outsourced, point of sale software for use in the postal industry worldwide. Its core software, Riposte Essential, enables post offices to expand upon their traditional offering, providing additional new services, reducing costs and increasing efficiency. Riposte is a messaging middleware that enables applications operating on different computers to communicate with each other. The Riposte software manages data, monitors the system status and communicates across the network. Escher operates across two divisions - its Retail Software Division and its Message Based Communications Division.

The Retail Software Solution (Riposte Essential) serves the postal and courier markets. Transactions include mail and financial services and the system is integrated with utilities and financial services companies, banks and central and local governments.

Escher's Message Based Communications Division (RiposteTrEx) is based on a digital post office box model and is designed to provide a national digital infrastructure linking governments, businesses and citizens via a secure platform.