14th Dec 2006 10:35
Lo-Q PLC14 December 2006 Lo-Q plc ("Lo-Q" or the "Company") Trading Update With the season over and the majority of the parks in which the Company operatesnow being closed for the winter, the board of Lo-Q (the "Board") would like toprovide an update on the progress made by the Company this year. The Company is pleased to announce that it has had a very successful season inthe theme parks in which it operates with Q-bots selling well. This isattributable to the performance of the US team, led by Steve Drake, supported bya product that continues to have a remarkable quality record. The Q-bot rentalrevenue to date has performed ahead of management expectations. The Company also announces that it has concluded negotiations with PalmtopProductions Inc. ("Palmtop"), the owners of a theme park line management patentbased on hand-held personal organisers. Whilst it was alleged that Lo-Q has beencontravening their patent, the Company's lawyers and specialist patent attorneysbelieve this not to be the case. As a result it had been the view of the Boardthat this claim could be successfully defended. After weighing the balance ofrisk present in any USA patent law case, the Company made the decision to pursuean out of court agreement to settle the case expediently. The Companyrecognises that this has the advantage of releasing a significant amount ofmanagement time and avoids the potential costs if any defence case were tobecome protracted. The initial settlement payable to Palmtop is for US$900,000. Lo-Q is alsorequired to make additional annual payments for the years 2007, 2008 and 2009.The company expects its resulting costs in meeting these three additionalpayments to be in the region of $70,000 in each of these years. After thesepayments the Company will have fulfilled its requirements under the settlement.The Board are confident that these exceptional costs can be absorbed by the cashflows from the business from the current and following financial years. The Company's normalised profit before tax for the year ended 31 December 2006is expected to be in line with market expectations. However, with the inclusionof both legal and settlement costs, which will be included as exceptional itemsin this years accounts of approximately £600,000, the Company will report a lossof approximately £0.3 million for the year ended 31 December 2006. Enquiries: Jeff McManus, Lo-Q Plc 01491 577 210John Prior, Romil Patel Corporate Synergy Plc 0207 448 4400 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Accesso Technology Group