Interim Management Statement - Sopheon

Sopheon plc, the international provider of software and services that improve the financial return from innovation and product development investments, announces its first interim management statement for the period from
1 January 2014 to the date of this announcement.

Following on from the strong performance in the final quarter of 2013, our solid maintenance base, some early license wins and high levels of services activity means that revenue visibility for 2014 already stands at £7.3 million (2013: £7.4 million reported, or £7.1 million on a constant exchange rate basis). As in prior years, the early part of the year was relatively quiet for new license orders, but involved extensive business development progress with both new and existing customers, which we expect to lead to additional license closings as the year progresses.

The rapid pace of product releases continued, with the release of Accolade® 9.1, the latest version of our flagship software solution which we described in detail in an announcement last week. We have maintained investment across our business, and since the start of the year have added staff in a number of areas, most notably in our US sales team. As always we continue to watch performance expectations closely when making recruitment decisions. In this regard we continue to emphasise to shareholders that the actual timing and value of individual sales events has substantial impact on reported performance for a given period.

On the corporate front, we were pleased to negotiate $3.5m in new debt facilities with Silicon Valley Bank. These facilities bear substantially lower interest than those they replace, reflecting the growing maturity of our business. Furthermore, as noted in our recent annual report, we have been in discussions with major holders of our £2m convertible loan stock which currently matures in January next year, and have agreement in principle for a two year extension. We were however disappointed to learn that Euronext intends to wind down the Alternext Amsterdam segment, a market that we joined recently, in late 2012. As we have stated, we will monitor and evaluate the situation in dialogue with Euronext before concluding on implications. In addition, as we have also noted before, incorrect processing by certain market participants in the Netherlands means that the board is considering a repeat of the share consolidation procedure conducted last summer.