Servelec Group plc Post Year End Trading Update

21 January 2016

Servelec Group plc

("Servelec" or the "Group")

Post year end trading update

The Board of Servelec is pleased to announce that trading for the year ended 31 December 2015 will be in line with market expectations.

Servelec Health and Social Care has performed exceptionally well during 2015, compensating for a correspondingly softer performance from Servelec Automation where the continued weakness in the Oil & Gas market held back Servelec Controls and a slower than expected increase in sales under the AMP6 programme impacted Technologies. This was partly mitigated by international wins, including contracts secured with GRT Gaz in France and Infrabel in Belgium.

Outlook

Servelec finished 2015 with a strong order book, an improving pipeline and an improved cash position. The Board remains confident in the outlook for the Group.

In Health and Social Care, activity is expected to remain buoyant through 2016 with a strong order book, increasing activity in the Social Care market and opportunities for Oceano and Rio in the North Refresh demonstrated by the recent Oceano win.

In Automation, Controls activity is expected to be driven by the increasing demand from Oil & Gas operators seeking to reduce Opex together with opportunities to refurbish CHP plants that are currently being dismantled and exported. In the Nuclear & Power market, the new management team will continue to strengthen the company's market position and order book. Within Technologies, RTU sales to the Oil and Gas industry were reduced as were orders under the AMP6 programme post the 2015 General Election. Management remains confident that the regulatory demand provided by AMP6 and its RTU, Optimisation and Telemetry product portfolio will enable it to capitalise on UK and global opportunities.

Alan Stubbs, Chief Executive, commented,

"We are delighted to have reported another full year of trading in line with market expectations for the business. The Group has delivered on its promises of strong and predictable financial performance, supported by its diversified business model. We finish 2015 with an improved cash position year on year and a strong order book going into 2016.

 "We will continue on our path of growth by an appropriate mix of organic performance and acquisitions during 2016 continuing to deliver value and return for our shareholders.

"The Board is positive about the outlook for 2016. Servelec Automation looks poised for a year of growth as delayed projects get off the ground and Health and Social Care will continue to improve on performance to date, specifically in its Social Care segment. Our portfolio of solutions provides compelling business cases for cost reduction and effective operations which is essential in the current climate."

The Company will release its preliminary results for the year ended 31 December 2015 on 1 March 2016.

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Notes to Editors

Servelec Group plc is a UK-based technology group, with significant intellectual property, providing software, hardware and services predominantly to the UK healthcare, oil & gas, nuclear, power, water, utilities and broadcast sectors.

Servelec has two operating divisions; Servelec Health & Social Care and Servelec Automation:

- Servelec Health and Social Care specialises in the design, development and implementation of Electronic Patient Record (EPR) and Patient Administration Systems (PAS) and Social Care Case Management software within secondary care and social care settings and is a market leader in the Mental Health, Community Health and Social Care sectors in England.

- Servelec Automation provides complex, mission-critical control systems to large blue-chip companies mainly in the UK, focusing on the oil & gas, nuclear, power, water, utilities and broadcast industries. Servelec Automation also provides services from consultancy through to design, implementation, delivery, installation and on-going customer support and maintenance.