Thursday September 27, 10:00 AM
Eckoh PLC - AGM Statement
RNS Number:6052E
Eckoh PLC (LSE: ECK.L - news)
27 September 2007
27 September 2007
Eckoh PLC
AGM Statement
Peter Reynolds, the Chairman of Eckoh PLC ('Eckoh'), commented at the AGM today:
'During the financial year ended 31 March 2007, the Board took steps to
restructure and reorganise the Group in order that our efforts could be focused
on the high margin, high growth speech solutions market. The excellent financial
results are a testament to the success of this reorganisation.
As we previously announced at the time of preliminary results on 18 June 2007,
turnover from continuing operations increased by 34% to #86.8m, and pre-tax
profits from continuing operations increased by #1.9m to #1.5m before intangible
asset amortisation and exceptional items; cash and short-term investments
amounted to #9.6m.
The Group is continuing to take steps to simplify itself and focus efforts on
the high growth speech solutions activity. Strategic options for the Connection
Makers business are being actively considered.
Within the Speech Solutions area a number of exciting new long-term contracts
were secured as well as a series of significant contract renewals from existing
clients, which led to a 19% increase in revenues in 2006/07 compared to the
previous year. We remain confident that this year Eckoh will consolidate its
position as the clear market leader in the UK for hosted speech recognition
solutions and the strong sales pipeline reflects the growing maturity and
opportunity in this sector. The Speech Solutions business continues to be the
long-term focus of the Group and where the Board believes the best value for
shareholders will be realised, and we remain committed to extending our
footprint into other European territories.
The issues in the interactive television market earlier this year have had a
significant impact on response levels generally, which still remain much lower
throughout the premium rate sector. Whilst these issues have reduced the
revenues in our Client IVR division, the very low margin nature of these
revenues means that this will have a much reduced impact on gross profits. The
investment Eckoh has made to become a 'best practice' supplier of IVR services
has provided a clear opportunity to win new contracts on more beneficial terms
going forward, as media owners place greatest importance on compliance, quality
and service. Eckoh has also made clear its intention to renegotiate its existing
client contracts in this area to either improve on the low margin that it
currently obtains or to discontinue those contracts on which this cannot be
achieved.
ITV (LSE: ITV.L - news) have already announced their intention to discontinue the ITV Play activity
which was responsible for much of the growth in Client IVR revenues last year,
however, this will not impact on market's profit expectations for this current
year. Nevertheless with activity levels likely to be reduced for the foreseeable
future in this area the Group will be looking to review its cost base across the
whole business with a view to making a significant reduction in direct expenses
before the end of the financial year.
I would like to take this opportunity to thank Eckoh's staff for their loyalty,
commitment and dedication over the past twelve months, as we all look forward to
an exciting year ahead.'
For further enquiries, please contact:
Eckoh plc
Nik Philpot, Chief Executive Officer Tel: 08701 100 700
Adam Moloney, Group Finance Director
Jim Hennigan, Executive Director
Corfin Communications Tel: 020 7977 0020
Harry Chathli, Neil Thapar, Ben Hunt
Seymour Pierce Limited Tel: 020 7107 8000
Jonathan Wright /Parimal Kumar
This information is provided by RNS
The company news service from the London Stock Exchange (LSE: LSE.L - news)
END
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