Year End Trading Statement

8 February 2012

Escher Group Holdings PLC ("Escher" or the "Group")

Year end trading update

Escher, the world leading provider of outsourced, point of sale software to the postal industry, provides an update on trading performance for the full year to 31 December 2011.

2011 was a year characterised by significant investment in new potential business opportunities, which culminated in the award of contracts with Haypost (Armenia), ABANA (Saudi Arabia) and today's announcement of a substantial new contract win, the largest in its history.

Revenue for the year is expected to be in excess of US$14m and reflects the extended process in securing the new contract win announced separately today, which is expected to generate approximately US$50m in revenue for the Group, but with scope for substantial additional revenue. A number of operational improvements will be reflected in the adjusted net earnings*. After the investment in new opportunities, the Board anticipates adjusted net earnings* for the year ended 31 December 2011 to be in the region of US$2.4m. 

In H2 2011 the Group established a new Division based upon Near Field Communication (NFC), a fast-growing standard that permits device-to-device communication allowing for information collection, exchange, payment processing, rewards and mobile wallets. The Group expects the NFC division to provide new opportunities within our existing postal market as well as in retail and telecommunications.

This investment over the last year has expanded Escher's product capabilities and is expected to result in a better early stage margin on new contracts secured and in additional revenue streams for the company on the RiposteTrEx and NFC technology.

The Board believes that the prospects for the Group remain strong as evidenced so far in 2012 by the material contract win announced today, the RiposteTrEx Licence announced on 20 January and the refinancing announced on 5 January.

Escher expects to publish its final results for the full year to 31 December 2011 on 26 March 2012.

Liam Church, CEO of Escher, commented:

"2011 has been a successful year for Escher with our listing on AIM and the additional market share won through our new contracts in Armenia and Saudi Arabia. 

"We have expanded our product offering with new product functionality in our Retail Product coupled with new product development in our Messaging Technology and Near Field Communications technologies.

"The year has also been characterised by large scale investment in operations linked to new business opportunities, which is reflected in the signing of the transformational contract announced today - substantially the largest in the Company's history.

"2012 starts with considerable momentum with a record order book, significant new contracts concluded and a continuing healthy sales pipeline within our three business lines. We expect 2012 to be a strong year with the prospect of further substantial growth in 2013 for the Group as we benefit from the investments made in 2011."

*Adjusted net earnings are net earnings excluding AIM listing expenses, new investment in the NFC division and share based payments.

For further information please contact:

Escher www.eschergroupholdings.com +353 (0) 1 479 0555

Liam Church, Chief Executive Officer

Fionnuala Higgins, EVP Sales & Marketing

Trevor McIntyre, Finance Director

Panmure Gordon +44 (0) 20 7459 3600

Andrew Godber / Callum Stewart, Corporate Finance

Hannah Woodley / Charles Leigh-Pemberton, Corporate Broking

Powerscourt +44 (0)20 7250 1446

Paul Durman / Nick Dibden

About Escher

Escher is a world leading developer and provider of outsourced, point of sale software for use in the postal industry worldwide. Its core software, Riposte Essential, enables post offices to expand upon their traditional offering, providing additional new services, reducing costs and increasing efficiency. Riposte is a messaging middleware that enables applications operating on different computers to communicate with each other. The Riposte software manages data, monitors the system status and communicates across the network. Escher operates across two divisions - its Retail Software Division and its Message Based Communications Division.

The Retail Software Solution (Riposte Essential) serves the postal and courier markets. Transactions include mail and financial services and the system is integrated with utilities and financial services companies, banks and central and local governments.

Escher's Message Based Communications Division (RiposteTrEx) is based on a digital post office box model and is designed to provide a national digital infrastructure linking governments, businesses and citizens via a secure platform.