Update on trading and strategic development

11 December 2013

Snoozebox Holdings plc

Update on trading and strategic development

LONDON, 11 DECEMBER 2013: Snoozebox Holdings plc (Snoozebox, AIM: ZZZ), the leading provider of portable hotel accommodation and services, today announces the outcome of the business review undertaken by the new executive team appointed in the second quarter of this year, led by David Morrison, Chairman. As outlined in the Interim Report of 30 June 2013, the review sought to address financial and commercial matters that had come to light earlier in the year.

Commenting on the outcome of the review, David Morrison said:

"I am pleased to report that the changes implemented by the new management team are leading to a turnaround of operating performance of the Company and have resulted in a positive contribution to central overheads in the third quarter, compared to the losses reported in the first half of the year.

The business faced many challenges earlier this year and the immediate focus of the new management team has been to stabilise the business and position it for growth. Actions taken included:

· Strengthening of financial controls, particularly operations and procurement

· Improving the planning, appraisal and project management of deployments

· A fundamental reorganisation of the sales and business development function which immediately delivered an increase in revenue through improved occupancy and pricing

· Overhauling the management structure and personnel

· A review of the cost structure, which has led to a reduction in permanent headcount of over 60%

· Progress on profitably deploying the first generation room stock to satisfy current demand for longer term semi-permanent hotels such as Nigg Energy Park

Whilst the business review initially focussed on turning around the operating performance, a clear strategy has also been developed to build the business and capitalise on demand. The Snoozebox brand is strong and is recognised as the creator of the market for portable hotel accommodation. The Company is experiencing a high level of sales enquiries, encouraging levels of repeat business and positive guest experience feedback. I am pleased to report that the Company will see c.80% growth in revenues in 2013 to approximately £6.5m and net cash in excess of £4m at the year-end, in line with expectations. For key events next year to which the Company has already committed, we are seeing a marked increase in room rates and repeat business.

The Company is enjoying a strong business development pipeline and a key conclusion of the review is that there is a compelling events opportunity which builds further on Snoozebox's leadership in this sector. In order to capitalise on the demand, the Company must evolve its product range. We have made substantial progress on this and the next generation product is designed, ready to build and will reduce deployment time and cost dramatically. The integration of systems, utilities and ancillaries minimise the assembly process, thereby reducing overhead costs. The resultant reduction in the deployment time from one week to one day opens up the potential for a substantial increase in occupancy and revenues.

In the UK alone, there are over 10,000 events each year, which are worth over £11bn in sleeping accommodation. In order to maintain leadership of this market, the Company will require investment on a scale that warrants future funding. In addition, the Board is exploring the potential of joint ventures and strategic acquisitions to accelerate growth.

Whilst our prime focus in the near term is to grow the business in the UK and European markets, the Company continues to explore routes to market in other territories including South America, Russia and the Middle East. There is no doubt that there are substantial opportunities for the Company in these territories. In addition to events, we are seeing interest and demand from a range of sectors including construction, energy, healthcare and local authorities.

We believe the business review delivers a strategy that validates the original idea and the Company can now look forward with confidence".

ENDS

Enquiries:

Website: www.snoozebox.com