Final Results

21 March 2013

ServicePower Technologies plc

("ServicePower" or the "Company")

Final Results

ServicePower (AIM:SVR), a market leader for outsourced service and field management, announces its audited results for the year ended 31 December 2012.

Financial summary

·; Revenues decreased to £11.1 million (2011: £13.3 million) reflecting delays in purchasing decisions

·; Approximately 90% of revenues recurring in nature

·; Gross profit of £4.5 million (2011: £6.7 million)

·; Loss before tax of £1.8 million (2011: profit £1.1 million), £0.5 million being a forex loss (2011 gain of £0.2 million)

·; Cash balance of £4.5 million at 31 December 2012 (31 December 2011: £5.5 million)

·; Basic and diluted loss per share of 0.95p (2011: profit of 0.54p)

Operational highlights

·; The additions of ServiceMarket and ServiceBroker to the ServicePower portfolio significantly extended the product portfolio - now a global supplier of an end-to-end platform for field service

·; Opening of US headquarters to support US market opportunities and identified pipeline for new business

·; Significant multi-year contract extension with E.ON

·; Ten new Service Operations contracts (2011: five), continuing to build future Software as a Service ("SaaS") revenues

Post year end

·; Significant extension of Assurant contract, to now include ServiceMarket

·; Landmark global ServiceScheduling contract with one of the world's leading providers of unified communications solutions

·; Acquisition of Stratix Software, adding enhanced mobility capabilities

·; Appointment of Joe Wang as VP Strategy, joining from Best Buy

Mark Duffin, CEO of ServicePower, commented, "In 2012 we considerably extended the capabilities of our field service platform, adding the power of crowd-sourcing, mobility and the cloud, positioning ServicePower at the forefront of the field services industry.

"We have had an extremely positive start to 2013, signing two significant contracts with Assurant and one of the world's leading providers of unified communications solutions. Whilst being cognizant of the current uncertain economic situation, our high levels of recurring revenue, significantly enhanced product platform and extensive blue chip customer base give us confidence in the prospects for ServicePower."

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About ServicePower

ServicePower, publicly traded on the AIM market operated by the London Stock Exchange (AIM:SVR), allows companies to locate their employed field resources in the right geography, ensure they have the right mix of skills, and outside this geography create a network of independent, authorised service contractors whose costs are efficiently managed by our sophisticated warranty management software. The schedules and routes for both the employed field resources and the independent servicers are optimised by ServicePower's technology to ensure the right balance between the cost of operations and ensuring customers receive a superior service experience.

Joint Chairman and Chief Executive's Review

Introduction

The financial results for 2012 were significantly impacted by delays in customer purchasing decisions however two significant contracts have been awarded to the Group post year end. Strong progress was made at the operational level during the year with investments in ServicePower's field service management platform, cementing its position as the only global provider of truly end to end field labour software. The enhanced ServiceScheduling product, the unique ServiceBroker, and the acquisition of S2 and Service Market in 2012 and ServiceMobility in early 2013 further broaden the ServicePower portfolio and create additional revenue streams in 2013.

With £4.5m of cash at year end, the fundamentals of the business remain strong with ServicePower having a powerful Field Service technology platform that is progressively differentiating itself from the competition. The significant contracts signed post year-end demonstrate the power of the enlarged software offering and build confidence for 2013 and beyond.

The Company has four segments, ServiceScheduling, ServiceOperations, as it has had historically, and in addition S2, a CRM solution, and ServiceMarket. ServiceMarket is a platform that offers a customer the ability to allocate work not only across its own labour force and third party service providers, but also to bid work out to independent service providers in a seamless fashion. No revenue was earned on S2 and ServiceMarket in the year under review although we anticipate revenues in 2013 as we integrate them with our service offering.Further integration between the segments has been developed with ServiceBroker, which provides a common user interface that enables customers to access the end to end field service management platform offered by ServicePower, something unmatched in the industry.

The Board is focused on generating increased organic profits, but continues to consider the potential for accelerated growth through additional selective acquisitions. ServicePower will also seek to grow through the entry into new market sectors and further extensions of contracts with existing customers.

Financial Review

Relatively challenging market conditions are expected to continue, however, the successes we have had early in 2013 give us confidence that the strength of our core products and the appeal of our expanded offering will position us well for growth, providing customers with increased efficiencies, enhanced service and the possibility of additional revenue streams.

Total revenue for the year decreased by 17% to £11.1 million (2011: £13.3 million). Within this, ServiceScheduling licence and consultancy revenue decreased by 10% to £7.0 million (2011: £7.7 million), whilst ServiceOperations revenue reduced by 27% to £4.1 million (2011: £5.6 million). Approximately 90% of revenue is recurring in nature. The new business segments will generate revenue in 2013.

A breakdown of revenue from the ServiceScheduling segment is as follows:

A breakdown of revenue from the ServiceOperations segment is as follows:

The Company continued to invest in maintaining functionalities across all of its product range, investing £1.0 million in 2012 (2011: £0.7 million) in its organic development efforts separate from acquisitions.

Gross profit for the period decreased to £4.5 million (2011: £6.7 million) and profit before tax decreased to a loss of £1.8 million (2011: profit of £1.1 million).

The adjusted loss before tax was £1.3 million (2011: profit before tax £0.9 million). The adjusted loss before tax refers to the loss before tax adjusted for a foreign exchange translation loss of £0.5 million (2011: gain of £0.2 million).

The basic and diluted loss per share for the full year was 0.95p (2011: basic and diluted earnings per share of 0.54p).

Cash balances were £4.5 million at 31 December 2012, compared to the cash balances at 31 December 2011 of £5.4 million.

Operational Review

Creating a complete field services platform

2012 saw ServicePower continue to build out its field management platform, cementing its position as the only global provider of a truly end-to-end, mixed labour resource software. Development of the platforms below have meant the evolution of ServicePower from the provider of a niche software solution to one with an end-to-end field services platform, enabling our customers to use resource pools independently or mix resource pools together, thus providing control over their ability to execute work within desired cost and time parameters.

The additions of ServiceMarket and ServiceBroker to the ServicePower portfolio significantly extended the product offering adding the next generation of social media technology onto the established platform.

·; ServiceMarket is a web-based marketplace on which pre-approved servicers can 'bid' for service jobs advertised by retailers, incorporating a payment system.

·; ServiceBroker allows clients to direct work between various channels of employed engineers, the independent servicer network or ServiceMarket.

In November 2012, the acquisition of a service management software source code licence from Bella Solutions, Inc. enabled the provision of a hosted version of ServiceMarket to be launched in early 2013. This SaaS version of ServiceMarket offers our network of independent service providers a comprehensive, low cost CRM solution with which to run their businesses more efficiently, while creating a new recurring revenue stream for the Company.

Integration to automated parts distribution was also completed in 2012, enabling ServicePower to offer supply chain logistics through its field management platform, as well as a mechanism to control part costs for customers who consume parts as part of the repair process, but do not manufacture parts.

Development of the platform has continued in 2013, with the acquisition of Stratix Field Service software, bringing enhanced mobile functionality. Device and operating system agnosticism is especially important in today's constantly evolving mobility environment where businesses are embracing a Bring-Your-Own-Device (BYOD) strategy, allowing employees to work from their own mobile devices.

The acquisition not only enhances the end-to-end platform with technology that is adaptable to any device, but it enables ServicePower to bid for mobile-only opportunities due to the breadth of product functionality, creating a new stand-alone revenue stream.

As a result of building the platform to contain all of the necessary tools, a customer can now turn to ServicePower to manage the complete lifecycle of a job, using a variety of field resources, from optimised scheduling and 3rd party dispatch, to mobile status updates, job based parts management, signature capture, GPS tracking, 3rd party claim payments and analytics.

Further development in 2013

ServicePower will launch ServiceRating.com by June 2013, providing service providers with the means to market their services on the web, and thus eliminating the need to maintain in-house web marketing expertise.

ServiceRatings.com will be a comprehensive directory of service providers, which includes features like deals of the day, article publishing, and profile videos and audio. It will offer service providers many different advertising opportunities throughout the site as well as a micro site option, providing them with additional revenue streams and encouraging social commerce and crowd sourced sharing of product and repair information

ServiceRatings.com enables ServicePower to enhance the platform through enabling third party networks to communicate like employed field resources, thereby enhancing their profitability and efficiency, strengthening opportunities for growth.

New Head Office

In September 2012, ServicePower announced that it had secured new premises for its head office in the United States, in Reston, Virginia. Reston is an established hub for growth technology businesses and the high quality offices will serve as a good base from which to service the Company's growing US client base. ServicePower's CFO, CIO, project managers, business analysts, technical consultants, product managers and architects have all now been centralised in Reston.

ServiceOperations

ServiceOperations had a good year in relation to sourcing new contracts, signing ten contracts (compared to five in the preceding year) with particular successes in the North American electronics market. New customers include Arcelik, Global Warranty Group, Funai Service Corporation, RepairTech, Service Team and Haier America.

These names add to ServicePower's existing electronics customers, who include Richer Sounds in the UK, Mitsubishi in the US and one of the world's largest TV manufacturers.

A significant contract renewal was signed in the year for a two-year extension to the Company's major contract with E.ON UK, one of the UK's leading integrated power and gas companies. E.ON has subsequently been spun off with a Venture Capital backer, who has undertaken to continue the contract under the same terms.

ServiceScheduling

Implementation of contracts won in 2011 continued with good progress being made at the RSPCA, Steritech and HomeServe, all of which went live in the year.

Significant contract wins post-period end

In January 2013, ServicePower secured a landmark, three-year global contract with a communications provider globally recognised as the industry leader. Through a very competitive bid process, the client selected ServiceScheduling as the mechanism through which it will manage, plan and analyze its field workforce in EMEA, North and South America. This contract further highlights the global capabilities of the platform and our ability to implement and execute on a global scale.

In January 2013, as a testament to the strength and completeness of the platform, Assurant Solutions, a global provider of underwriting, marketing and administration solutions, and an existing ServiceOperations client since 2009, extended its license in a six figure deal to include ServiceMarket, enabling Assurant to provide additional, unique service offerings to their clients and to consumers, yielding the best possible experience at the best possible price.

Board Changes

In October 2012, ServicePower announced the appointment to the Board of Rick Mace as Non-executive Director. Rick has led businesses within the telecommunications and networking markets, with extensive experience with hardware, software and service business models. He has international experience and has worked with both publicly listed and private companies. At the same time, Non-executive Director, Rudy Burger resigned from the Board.

On 7 January 2013, post the year end, Marne Martin was appointed to the Board as Chief Financial Officer, acting alongside Sally Gillings, who resigned on 28 February 2013, to affect an orderly handover. Ms. Martin has a strong background in corporate and global finance execution. Most recently, Ms. Martin was CFO of AIM listed Norcon plc, a UK based telecommunications and defence consulting company, leading the company's IPO on AIM in 2008 and successfully completing primary and secondary share placements in 2009 and 2010.

Growth Strategy

ServicePower's expanded product set, strengthened market position and growing number of successful customer reference sites both in the UK and US provide a broad platform on which to build. In the Group's core verticals of white goods, consumer electronics, insurance and energy, ServicePower will continue to seek new opportunities whilst also bringing in expertise in additional vertical markets into the Group through new hires.

Outlook

With demonstrated sales success, and continued investment in development of our global field management platform, ServicePower is positioned for a strong performance and a return to profitability in 2013. Our growing, prestigious client base, including some of the best known brands in the world, is proof of our commitment to providing the best, most complete, and technologically advanced field management tool in the world. Trading in 2013 has begun somewhat ahead of expectations, and we are confident of a successful outcome to the year.

Lindsay Bury, Chairman Mark Duffin, CEO 21 March 2013

All amounts relate to continuing activities.

Consolidated cash flow statement for the year ended 31 December 2012

ServicePower Technologies Plc

1 Basis of accounting

The annual financial statements are prepared in accordance with IFRS as adopted by the European Union.

While the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRSs), this announcement does not itself contain sufficient information to comply with IFRSs. The Group expects to publish full financial statements that comply with IFRS in March 2013.

2. Going concern

The financial statements have been prepared on the going concern basis.

A significant portion of cash receipts comes from the sale of large software licences. The signing of contracts by large corporate customers can be difficult to predict due to long procurement cycles and therefore there is uncertainty in forecasting the timing and quantum of cash receipts from these customers.

At 31 December 2012 the Group had net assets of £1,787,000 including £4,524,000 of cash and cash equivalents (31 December 2011 - net assets of £3,186,000 including £5,473,000 of cash and cash equivalents).

In determining whether the Group's accounts can be prepared on a going concern basis, the directors considered the Group's business activities together with factors likely to affect its future development, performance and its financial position including cash flows, liquidity position and the principal risks and uncertainties relating to its business activities.

Based on cash flow forecasts which take into account the directors' best estimate of current sales orders and opportunities, expenditure forecasts in addition to the Group's current cash balance, the directors consider it appropriate to prepare the Group's financial statements on the going concern basis.

3. Business segments

Segment information reported externally is analysed on the basis of the Group's business streams, namely ServiceScheduling software licences which provide scheduling solutions, and ServiceOperations which provides claims and despatch processing in the consumer electronics market. This method of segment analysis is used to report to the Board and the Chief Executive. The business segments ServiceMarket and S2 referred to in the Chairman's Statement have generated no revenue and have not incurred costs in the year under review and are not disclosed below.

Segment information about these businesses is presented below:

The accounting policies of the reportable segments are the same as the Group's accounting policies described in note 2 of the full financial statements. Segment profit represent the profit earned by each segment without allocation of central administration costs, including directors' salaries, investment revenue and finance costs and income tax expense. This is the measure reported to the Group's Chief Executive for the purpose of resource allocation and assessment of segment performance.

Segment assets

For the purposes of monitoring segment performance and allocating resources between segments the Group's Chief Executive monitors the tangible, intangible and financial assets attributable to each segment. All assets are allocated to reportable segments with the exception of cash and cash equivalents and trade and other receivables of the parent company and Servicepower AG.

Other segment information

The Group's revenues from its major products and services were as follows:

Geographical information

The Group's operations are located in the United States of America, the United Kingdom and the rest of Europe. The Group's revenue from external customers and information about its segment assets by geographical location are detailed below irrespective of the origin of the services:

Information about major customers

In 2012, included in revenues arising from ServiceScheduling were revenues of approximately £1.6 million from one customer, which represented more than 10% of Group revenue. In 2011 this customer contributed revenues of £1.5 million, which was more than 10% of Group revenue.

Included in revenues arising from ServiceOperations are revenues of approximately of £0.9 million (2011: £0.6 million), which arose from sales to a customer whose turnover represents more than 10% of Group revenue.

4 (Loss)/profit before taxation

(Loss)/profit before taxation has been arrived at after charging/(crediting):

Amounts payable to Deloitte LLP and their associates by the Group in respect of non-audit services were £10,000 (2011: £7,000).

5 Taxation

Corporation tax is calculated at 24.5% (2011: 26.5%) of the estimated assessable loss for the year.

The charge for the year can be reconciled to the profit per the income statement as follows:

Subject to agreement with the HMRC, the Group has taxable losses of approximately £17.2 million (2011: £16.0 million), which are available for offset against future trading profits.

No deferred tax asset has been recognised on the basis of the uncertainty of the timing of new licence contracts, particularly given the long procurement processes for new licence agreements. In the opinion of the directors there is sufficient evidence that the asset would be recoverable in the foreseeable future.

6 (Loss)/earnings per share

The calculation of the basic and diluted (loss)/earnings per share is based on the following data:

The convertible loan note has an anti-dilutive effect and therefore diluted (loss)/earnings per share are capped at basic (loss)/earnings per share.

7 Notes to the cash flow statement

8 Non statutory information note

The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 December 2012 or 2011, but is derived from those accounts. Statutory accounts for 2011 have been delivered to the Registrar of Companies and those for 2012 will be delivered following the Company's annual meeting. The auditor has reported on those accounts; their reports were unqualified, did not draw attention to any matters by way of emphasis and did not contain statements under s498 (2) or (3) Companies Act 2006.