Final Results

eg solutions plc ("eg" or "the Company"; LSE-AIM: EGS), the back office optimisation software company, announces its unaudited results for the year ended 31 January 2014, which were in line with market expectations.

Financial Summary:

* after exceptional remuneration costs of £343,000 (2012/13: nil).

Key highlights:

· Four significant customer wins including first major win in the UK utility sector and the first Aspect contract win

· £1 million cash invested to set up Aspect's American and Asian distribution capability and strengthen eg's own direct EMEA sales and worldwide delivery teams

· £0.8 million invested in R&D to support enterprise wide and international sales

· Strategic partnership secured with Aspect and additional implementation and technology partnerships secured since year end with Intradiem and Curium

· Duncan McIntyre to be appointed as Non-Executive Chairman

CONTACTS

About eg solutions plc

eg solutions plc is a global back office optimisation software company. Our software provides historic, real-time and predictive Operational MI. When implemented with our training programme for managers and team leaders to use this intelligence, we guarantee improvements in operational results in short timescales.

The Company, which is listed on the Alternative Investment Market ('AIM') of the London Stock Exchange, is committed to customer satisfaction and the ongoing development of its operations management solutions.

Acting Executive Chairman's Statement

Overview

eg's financial performance for the year ended 31 January 2014 was in line with market expectations following the well documented challenges and changes during the reporting period.

Since the management changes in December 2013 we have conducted a comprehensive review of eg's business covering our products, organisation, partners, market position and strategy for growth. This process has validated the Group's strengths and the competitive advantage provided by our eg operational intelligence® software suite, as well as strengthening the Board's conviction that the potential of the end market and user demand is substantial.

Despite an improving macro-economic environment, businesses throughout the world continue their drive to improve customer service, operational efficiency, cost control and risk management. These factors are driving increasing demand for back office optimisation solutions.

Our conclusions are further supported by the latest research from DMG Consulting LLC, the leading call centre and real-time analytics consulting and research firm, which also continues to state that eg is one of the only two workforce optimisation ("WFO") vendors with true back office solutions.

It is clear that there is an outstanding opportunity for growth in this emerging market and that eg must now focus on securing the market share it deserves to deliver increased value to shareholders.

During the year we completed significant investments which position the Group to optimise these opportunities. Total investment for the year was £1.01 million, completing the investment made over the past two years in winning global customers, the strategic distribution partnership with Aspect Software Inc ("Aspect") as well as in eg's own direct sales channel in EMEA and expanding its client implementation team to support future growth. Since the year end we have announced a further two strategic partnerships - with Intradiem Inc and Curium Solutions Ltd.

We are also experiencing increasing demand for hosted solutions. This is reflected in increased recurring revenues which accounted for 36 per cent of the total for the year and enhance visibility for the next few years.

Strong cash flow management resulted in net debt at the end of the year being maintained at the same level as at the end of 2012/13. In February 2014 we arranged a £0.55 million convertible loan facility to provide additional working capital for the Group's continuing growth.

Appointment of Chairman and other Board changes

We are delighted to announce that Duncan McIntyre has agreed to join the Board as Non-Executive Chairman. Aged 54 years, Mr McIntyre's successful international business career includes roles as Chairman, Chief Executive and investor with a number of quoted and private companies, mainly in the technology sector, including Monitise plc and Morse plc. He invested £0.2 million in the convertible loan facility announced after the year end.

Following Mr McIntyre's appointment, I will step down as Acting Executive Chairman but continue as Acting Chief Executive Officer.

In July 2013, Spencer Mallder, Aspect's Chief Technology Officer, was appointed a Non-Executive Director.

In December 2013, John O'Connell resigned having joined the Board in March 2013.

In January 2014, Rob Glenn resigned having joined the Board in July 2013.

Phil Lee has also advised the Board of his intention to resign once a replacement has been found.

Work continues to strengthen the Board further through the appointment of additionalnon-executive directors. Further updates will be provided in due course.

Financial results

Total revenue for the year was £4.46 million (2012/13: £4.95 million). Software licences, maintenance and software services contributed 76 per cent (2012/13: 69 per cent) of total revenue, with the balance coming from implementation and training services.

Recurring revenue has continued to grow, increasing by 36 per cent on the prior year and resulting in a contracted order book of approximately £6 million to be recognised over the coming two financial years.

Overall gross margin for the year was 45.8 per cent (2012/13: 49.7 per cent), the decrease reflecting the cost of pilot schemes with significant potential customers and investment in expanding the client implementation teams. In addition, exceptional remuneration costs totalling £343,000 were incurred. This led to a loss before tax for the year, including these exceptional costs, of £1.48 million (2012/13: £0.46 million loss).

The loss after tax was £1.27 million (2012/13: £0.30 million loss).

At 31 January 2014, following investment in research and development of £0.80 million (2012/13: £0.74 million) and after the costs associated with investment in expanding the EMEA direct sales channel and the client implementation teams, net debt was £0.31 million (2012/13: £0.30 million net debt).

The Board has decided not to recommend the payment of a dividend.

Strategic partnerships

In February 2013 we announced the exclusive strategic distribution partnership agreement for the Americas and Asia with Aspect, and its equity investment of £1.25 million for a 10.69 per cent shareholding in the Group.

We continue to seek strategic partnerships which enhance our product offering, establish new channels to market and provide access to project implementation and other skills.

In February 2014, we announced a further two new strategic partnerships which were with Intradiem and Curium.

As a result of the partnership with Intradiem Inc ("Intradiem"), eg can respond to the growing demand for blending front and back office work by offering a unique solution. Intradiem is the leading provider of intraday management solutions, whose patented intraday technology has been integrated into the eg operational intelligence® suite. Intradiem's software is used to identify spare capacity in call centres in real time. This data is then utilised by the eg operational intelligence® suite to deliver back office work to agents based on their skills and availability, ensuring that work is completed within service level agreements.

Call centres are increasingly seeking to blend their front and back office activities in order to maximise the effectiveness of customer service staff across the whole enterprise and to achieve significant productivity gains. Using eg operational intelligence® to blend work allows businesses to achieve high customer service levels, regardless of the source of customer activity, and to reduce the customer journey through the organisation. eg can respond to this growing demand for blending and deliver a unique solution, thereby significantly enhancing the Group's competitive edge over traditional WFO software vendors.

The partnership with Curium Solutions Ltd ("Curium"), a Birmingham-based operations and change management consultancy, is part of eg's strategy to increase implementation options for its clients. Curium's experienced operations and change management consultants will implement eg's software as part of their own projects as well as providing additional or alternative resources and expertise for eg's implementations.

Operational review

During the year a number of notable new contracts were secured. These wins reflect growing customer demand for hosted solutions, our success in targeting sectors outside financial services and a significant increase in recurring revenues. They include:

· in May 2013, following a competitive process, an initial project from a UK friendly society;

· in July 2013, the first major contract outside the financial services industry, worth £1.2 million over 3 years, from a leading UK utility;

· in November 2013, an initial contract through Aspect from a leading global financial institution covering 750 users in Asia Pacific with potential to roll-out across the global back office functions thereafter; and

· in December 2013, a further managed cloud services contract worth £750,000 over three years from an existing major third party outsourcing client.

The Group has continued to invest in software product development with the latest version of the eg operational intelligence® software suite being launched in London on 25 March 2014. This new version includes significant platform and functionality enhancements and will provide substantial benefits for existing and potential global customers.

Product development for the year included completing integration components with Aspect's product suite and the successful addition to eg operational intelligence® of localisation functionality. This enables users in multiple regions to use the software on a single installation with multiple languages, time zone and region settings.

People

Despite the challenges and changes during the year, the Group is emerging from a difficult period a stronger and more mature business. This is the result of the commitment and professionalism of the eg team who have continued to deliver excellent project results for our customers.

eg's graduate programme, run in partnership with DorISCentral, has provided the Group with some exceptional talent. eg's graduates are now embedded within the eg team and in 2014 we will build on this success and continue our in-take of graduate level talent.

On behalf of shareholders and the Board I would like to thank everyone at eg for their continuing commitment and hard work.

Remuneration

During the year PricewaterhouseCoopers ("PwC") completed a review of executive rewards in order to align the remuneration and incentives received by all Board directors and senior executives with the interests of shareholders. The Board accepted the remuneration recommendations of PwC in full and the reward schemes proposed have now been implemented.

We have continued to work with PwC on the design of a Long Term Incentive Plan for senior management and Board members. Further updates will be provided in due course.

Current trading and outlook

eg has completed a period of investment and emerged from the challenges and changes of last year a much stronger Group.

We are winning new customers from outside the financial services sector as well as targeting larger projects from global enterprises and increasing recurring revenues.

Our relationship with Aspect is developing well with a strong pipeline of new opportunities. Pilot and full implementation projects are well under way in South Africa, Asia and the UK using the integrated Aspect/eg solution.

New business opportunities being generated by both eg and Aspect demonstrate the continuing emergence of the back office optimisation market.

With a large proportion of our expected revenues for the current financial year already under contract and a strong pipeline of further opportunities, we are confident of our prospects for the current year.

Elizabeth Gooch

Acting Executive Chairman

UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 JANUARY 2014

UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 JANUARY 2014

UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 JANUARY 2014

UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

The share based payment reserve is a reserve to recognise those amounts in retained earnings in respect of share based payments.

The own shares held reserve shows movements in the shares held in trust by the eg solutions Employee Benefit Trust.

Retained earnings include the accumulated profits and losses arising from the consolidated statement of comprehensive income excluding foreign exchange differences.

The foreign exchange reserve comprises all exchange differences arising from the translation of the financial statements of overseas operations.

Other reserves represent the equity component of the convertible loan notes.Notes:

1. Basis of Preparation

The accounts for the year ended 31 January 2014 are in the final stages of completion.

The information in this preliminary results announcement has been prepared on the basis of the accounting policies which will be set out in the Group accounts for the year ended 31 January 2014 and does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. Full accounts of eg solutions plc for the year ended 31 January 2013, which were prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, have been reported on by the Company's auditors and delivered to the Registrar of Companies. The report of the auditors was unqualified and did not contain statements under Section 498(2) or (3) of the Companies Act 2006.

The preliminary results announcement for the year ended 31 January 2014 was approved by the Board of Directors on 19 March 2014.

2. Revenue

3. Profit from operations

4. Earnings per ordinary share

EPS has been calculated using the following methodology:

Basic earnings per share are calculated by dividing the earnings attributable to ordinary shareholders by the number of weighted average ordinary shares during the period. The number of shares excludes shares held by an Employee Benefit Trust.

For diluted earnings per share, the number of ordinary shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. These represent share options granted to employees and, in 2014, Warrrants issued to Aspect.

When the Basic EPS is a negative value, the effects of anti-dilutive potential ordinary shares are ignored in calculating diluted EPS.

5. Reconciliation of group profit before tax to net cash generated by operations

Copies of this announcement are available on the Company's website: www.eguk.co.uk. The Annual Report & Accounts and Notice of Annual General Meeting will be sent to shareholders in due course and will also be available on the Company's website from the date of posting.