Intec is undergoing a period of transition, as we move from being a vendor of several important point products to a tier one vendor supplying critical OSS/BSS solutions to major companies. Our results for the first quarter, which include a full contribution from Singl.eView, reflect this transition. While the headline revenue and earnings numbers, and the turn around progress with Singl.eView, are very encouraging, particularly given the investment in time and effort that goes into the integration of a large acquired business, we are aware that the underlying business model is changing. Not only are we a larger organisation, the balance of revenue sources, which in core Intec has been very stable for some time now, has shifted towards a greater contribution from major projects, including some key contracts in the next generation services space. At the time of writing we are finalising a major Singl.eView contract in Africa, which is around twice the size of our previous largest deal, and several other deals of similar size are in the pipeline. We consider this a very positive development, but one that must be managed carefully as we move forward into 2005.

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.Intec Telecom Systems PLC Releases Unaudited Quarterly Results

— Good performance from Singl.eView acquisition drives 53% revenue increase; continuing cost management brings strong cash flow and earnings ahead of budget —

London/Atlanta, February 8, 2005 - Intec Telecom Systems PLC (“Intec” or “the Company”) [LSE: ITL], a global provider of enterprise-level software and services, today announced its unaudited results for the quarter ended December 31, 2004. A strong first reported quarter by Intec’s recent Singl.eView acquisition, indicating excellent progress in the ongoing turn around of this business, has increased revenues over the comparable period in 2004 by 53%. Good cost control, despite investment in the enlarged business, has delivered EBITDA1 earnings ahead of budget at £2.2 million ($4.1 million) and adjusted EPS of 0.28p.

In addition to these positive financial results, Intec is experiencing good momentum in new business wins and high levels of activity in current pipeline development, most notably several large, multi-product deals, each valued in excess of $10 million, in late stages of finalization.


  • Turnover of £23.9 million ($44.9 million) increased by 53% (3 months ended 31 December 2003 (“Q1 2004”): £15.6 million ($27.75 million)).
  • Adjusted2 profit before tax of £1.2 million ($2.26 million) compared to £1.6 million ($2.74 million) in Q1 2004 after continued investment in acquisitions and business development.
  • Adjusted EPS of 0.28p (Q1 2004: 0.58p).
  • Operating cash inflow of £3.5 million ($6.58 million) compared to Q1 2004 outflow of £0.1 million ($0.18 million).
  • Recurring revenue up 50% to £11.4 million ($21.4 million) compared to Q1 2004: £7.6 million.
  • Loss before tax of £3.1 million ($5.8 million) compared to Q1 2004 loss of £0.8 million ($1.33 million), after depreciation and amortization of goodwill and intangible assets of £5.2 million ($9.8 million) compared to Q1 2004: £2.9 million.
  • Substantial increase in balance sheet strength with cash and cash equivalent investments of £34.2 million ($64.3 million) compared to Q1 2004: £13.8 million ($24.5 million).
  • Gross margin reduced to 61% (Q1 2004: 73%) due largely to short-term factors following the Singl.eView acquisition.
  • Several important new contracts signed since the start of the financial year.
  • Customer installations reach 678 in 471 operators, with over 1,000 staff now involved in development and delivery of solutions to customers.

"I am very pleased to report that the performance of the Singl.eView business has exceeded our expectations and, combined with another solid quarter from the core business, has allowed us to deliver both revenue and earnings ahead of our budgets,” said Intec’s Executive Chairman, Mike Frayne. “Our results for the first quarter of 2005, which for the first time include a full quarter’s contribution from the Singl.eView business acquired in August 2004, are not directly comparable to any previous period. However, the first quarter of the year can be the most unpredictable, and these results are therefore a very good foundation for the rest of 2005.”

“Our progress with Singl.eView is very pleasing, and the larger contracts we are now winning underscore the strong opportunities we see ahead,” added Chief Executive Kevin Adams. “Execution across the business is in line with or exceeding our plans and the core business has not been distracted from its goals by the demands of taking on a major new line of activity. Our committed revenue forecast, prospect pipeline and activity levels for the rest of 2005 are also ahead compared to a year ago, and with a number of large, multi-product deals in progress we are confident that 2005 will be another successful year for Intec.”

The full text of this release is available from the Intec website at www.intecbilling.com

1EBITDA – Earnings Before Interest, Tax, Depreciation and Amortization are stated before exceptional items of £0.3 million relating to the Singl.eView acquisition, including restructuring costs and professional fees.

2Adjusted earnings – A reconciliation between adjusted profit before tax and the loss before tax is shown on the financial highlights page available from the Intec website.

Operational Review
In the first three months of our 2005 business year we secured 10 new licence contracts, the majority with new name customers, representing important business in all of our four operating regions, EMEA, North America, CALA and Asia-Pacific. This brings our total of customers to 471, with 678 installations. New customers were secured in nine countries, including the US, Saudi Arabia, Bangladesh, Morocco, Israel, Ireland, Turkey, Thailand, and Australia. A notable win was in Saudi Arabia with Saudi Telephone Corporation, our first OSS/BSS client in the country, and the leading communications provider in the region. With the changes due to the Singl.eView acquisition it is not possible to directly compare the current results on a regional basis with the prior period, as the geographical spread of the acquired business was quite different to Intec previously, with a greater predominance of Singl.eView business in EMEA and North America. However all areas have performed satisfactorily, with new business wins signed and good development of their pipelines for 2005. Our visible revenues against full year expectations are ahead of the figure at this point a year ago, a very encouraging result given the much larger revenue target. Intec continues to have a very effective sales and marketing organisation, combined with good indirect channels through business partners and system integrators. New licences were signed for InterconnecT, Inter-mediatE, InterconnecT CABS, Intec DCP, InterconnecT OR as well as a number of Singl.eView upgrades. We now have over 210 InterconnecT family installations worldwide, over 140 Inter-mediatE installations, 68 Intec ASF DCP installations, over 135 InterconnecT CABS customers, and 67 Singl.eView customers. During Q1 we ran highly successful User Conferences in our EMEA, Asia-Pacific and CALA regions with over 400 delegates attending the events.

Intec continues its policy of substantial investment in its products and technology base. Intec now employs around 340 people in its Product Operations organisation, based from a number of development centres. A large number of staff are now based in relatively low cost locations such as Cape Town and Brisbane, enabling Intec to deliver maximum value for its development spend. Intec has carrier grade products in retail billing and customer management (Singl.eView), interconnect billing and settlement (InterconnecT family), convergent mediation (Inter-mediatE), service activation (Inter-activatE), dynamic charging (Intec DCP), content partner management (InterconnecT CPM), and optimised routing (InterconnecT OR), plus various additional solutions.

About Intec Billing

Intec is a leading OSS product vendor for fixed, mobile and next-generation networks (i.e. WLAN, 3G and IP), with more than 650 installations of its products worldwide in 450 customers. Founded in 1997, Intec was listed on the London Stock Exchange in June 2000. Intec is a market leader in inter-carrier billing systems and convergent mediation software, and has recently acquired strong capabilities in retail billing, IP billing and real-time mobile service charging and control. For the year ended 30 September 2003, Intec reported revenues of £50.7 million, with adjusted net earnings after tax of £4.1 million.

Intec’s product portfolio includes:
· Singl.eView™ – dynamic transaction management/retail billing - also referred to as Singleview.
· Inter-mediatE™ – convergent billing mediation solution;
· InterconnecT™ – inter-carrier billing including US CABS and ITU-based settlement;
· Inter-activatE™ – flow-through provisioning and activation;
· InterconnecT CPM™ – end-to-end content partner management; and
· Intec DCP™ (Dynamic Charging Platform) – real-time pre/post-paid charging.

For more information about Intec and its products and solutions visit www.intecbilling.com.

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