GLOBO plc

INTERIM RESULTS FOR THE 6 MONTHS ENDED 30 JUNE 2008 

Globo plc ("Globo", the "Group" or the "Company"; LSE-AIM: GBO), a leader in the Information and Communications Technology market in Greece, is pleased to announce its interim unaudited results for the 6 months ended 30 June 2008. 

Key points:

• These are the first interim results to be announced since Globo's Admission to AIM in December 2007.

• Traditionally, the first 6 months is the slower half of the year.

• Revenues increased by 76% to €7.21m (H1, 2007: €4.09m).

• Profit before tax increased by 115% to €0.86m (H1, 2007: €0.40m), in line with the Company's expectations.

• Solid progress achieved in all segments of the business including both public and private sectors, with the first meaningful contribution to revenue from Software as a Service.

• Progress in international expansion achieved in Romania, Cyprus and Bulgaria.

• Strong order intake achieved across the business with forward order book standing at €9.3m at 30 June 2008 (31 December 2007: €3.6m).

Outlook:

"The second half of 2008, traditionally the stronger trading period, has started with the benefit of a significant order book and good visibility of revenues through to the year end.  We are confident of achieving good results for 2008 as a whole."

CONTACTS

About Globo

GLOBO plc was admitted to AIM in December 2007. Founded in 1997 by Konstantinos Papadimitrakopoulos and headquartered in Halandri (a suburb of Athens), Globo has established itself as one of the market leaders in the Greek ICT market.  It provides e-business and telecom software products and related services to the private and governmental sectors in Greece as well as developing and operating broadband wired and wireless networks. It has developed to become one of the largest e-business software and S.a.a.S. vendors in Greece.  For further information please go to www.globoplc.com. 

  CHAIRMAN & CHIEF EXECUTIVE OFFICER'S STATEMENT

Introduction

We are pleased to present Globo's interim financial results for the six months to 30 June 2008. These results show that the momentum gained within the business in 2007 has been sustained in the first half of 2008 with strong growth in revenue, profits and order book.

As Globo's Admission to AIM was effected by way of a reverse takeover of Israeli Acquisitor I plc, the results for the six months ended 30 June 2008 are consolidated whereas the comparative numbers for the six months ended 30 June 2007 are for Globo Technologies S.A. and Profitel S.A, the principal operating businesses of the Group.

Results and Finance

Revenue for the six months to 30 June 2008 increased by 76% to €7.21 million (H1, 2007: €4.09 million) with strong growth being achieved in all segments of the business. Operating profit grew by 72% to €1.36 million (H1, 2007: €0.79 million) and an increase in the pre-tax margin to 11.9% (H1, 2007: 9.8%) resulted in profits before tax increasing by 115% to €0.86 million (H1, 2007: €0.40 million). 

Reflecting the significant growth of the business, an increase in working capital resulted in net debt (excluding long-term finance leases) of €8.44 million as at 30 June 2008 (30 June 2007: €6.08 million; 31 December 2007: €4.55 million). 

Operations

During the period under review, traditionally the slower half of the year, each segment of Globo's business has made solid progress.

Total revenues from software products and services (government, public and corporate sectors) increased 92% to €6.42 million (H1, 2007: €3.31 million).

Within the government and public sector, order intake was strong with a number of substantial digitalisation contracts being secured for delivery during the course of the current year. These included projects for the Greek Ministry of Mercantile Marine, the Greek Ministry of National Education and Religious Affairs and the Parliament of Greece. 

Corporate sector revenues are based on Globo's suite of CITRON branded e-business applications and broadband access technologies including Internet Hotel and WiPLUS from customers such as Lambrakis Press Organization S.A., Publicis Hellas S.A., E - Shop.gr S.A., Euroxx Securities, Newsphone S.A, Angelicoussis Shipping Group, Istron Bay Hotel and Philippion Hotel. New customers such as Pfizer Hellas and Wilo Hellas have been added to the Group's clientele since the period end and will contribute to revenue in the second half of the year. 

These results include the first meaningful contribution to revenue from Profitel, Globo's S.a.a.S. (Software as a Service) division at €0.16 million (H1, 2007: €nil). Although still modest, this represents a 43% increase on the S.a.a.S. revenues achieved in the second half of 2007.

During the first half of 2008, progress has been made in developing the Company's international presence. An operating subsidiary has been established in Romania. Planning for additional operating subsidiaries in Cyprus and Bulgaria is also under way. Globo has been operating in Cyprus since 2007 through a reseller network and expects to achieve a stronger market presence by forming a wholly owned operating subsidiary. 

New product development continues to be given a high priority. Total investment in product and service development during the period was €2.19 million (H1, 2007: €1.71 million) which was capitalised in accordance with International Financial Reporting Standards ("IFRS"). Globo continues to invest in the development of its existing software platforms such as the Citron Business Operating System and the WiPLUS Broadband Access platform in order to enhance more functionality and to better serve our customer needs. In the meantime significant effort has been made to transform these systems to support the S.a.a.S business model which the Company is aggressively developing. This, together with establishing our technological footprint on the mobilisation of our e-Business products in order to encourage the 'ubiquitous computing' needs of modern enterprises, sets a solid cornerstone of future commercial development based on the current global market trends and customer needs. 

The significant growth of the business has led to an increase in the number of employees to 103 persons (H1, 2007: 55) and the appointment of some experienced new management and business development personnel including:

    Mr Sotirios Issaias: appointed as Profitel's Sales Manager in February 2008, Sotirios graduated from the Lycee Leonin and also holds degrees from the University of Indianapolis (USA) and  Concordia University (Canada), and a graduate diploma from McGill University (Canada). He has been working in the telecommunications field in corporate sales in the Greek market where he has gained extensive expertise with Eurolink SA and Net One SA.

    Mr Nikos Giannakakos: appointed as Value Added Services & Mobile Business Development Manager in July 2008. Nikos graduated in Computer Systems Engineering from Sussex University and holds Masters degrees from Brunel University and the National University of Finance and Economics in Greece. He has worked in the telecommunications industry since 1996, beginning his career at Epsilon Software S.A., OTE and Vodafone Greece where he led the team responsible for the commercialisation and business strategy of all mobile Value Added Services.

    Mr Stathis Vovos: appointed as SaaS & Value Added Services Business Development Manager in September 2008. Stathis has a degree in Electrical Engineering from the National Technical University of Athens and an MBA from the City Business School in London. Stathis has held positions at Research International, OTE Hellas Online and Lannet Communications..

Appointment of joint broker

In June 2008, we were pleased to announce the appointment of St Helen's Capital Plc as the Company's joint broker, alongside NCB Stockbrokers Limited who continued to act as the company's Nominated Adviser and joint broker.

Strategy

Globo's stated strategy to date has been to expand its operations within the public and corporate markets in Greece and also internationally. Solid progress with these objectives has been achieved during the period. During recent months, it has become clear to the Board that Globo's investment in its proprietary technologies will offer opportunities for expanding both the scope and range of the business in the future. Our future strategy will be to fully exploit these potential opportunities.

Outlook

The strong order intake during the first half means that Globo started the second half with a forward order book of €9.3 million (31 December 2007: €3.6 million), the bulk of which is expected to be delivered during the current year. The order book currently stands at €8.5 million. 

The second half of 2008, traditionally the stronger trading period, has started with the benefit of this significant order book and good visibility of revenues through to the year end. We are confident of achieving good results for 2008 as a whole.

Brett Miller                                                                                                           Costis Papadimitrakopoulos

Chairman                                                                                                                          Chief Executive Officer

  Financial Review

In the first half of 2008 the Group has produced an excellent financial performance, driven in particular by continued strong growth in software services but also reflecting strong contributions from all main business areas.    

In the six months ended 30 June 2008 revenue reached €7.21 million, a 76% increase on the same period in 2007 (€4.09 million). The increase in revenue came from organic growth in both private and public sector segments of the Group. 

Gross profit increased by 87% to €3.08 million (H1 2007: €1.65 million) delivering a margin of 43% (40% in 2007).

Operating profit excluding depreciation and amortization increased 56% to €3.0 million (H1 2007:  €1.92 million) delivering a margin of 41% (H1 2007: 46%).  Depreciation and amortization of the non-current assets reached €1.62 million (H1 2007: €1.13 million) reflecting the significant product development. Operating profit increased by 71.3% to €1.36 million (H1 2007: €0.79 million) which despite the increase of 43% in the depreciation and amortization charge, delivered an operating margin of 18.9%, slightly below the same period of 2007 (H1 2007: 19.4%).

Profit before tax reached €0.86 million, an increase of 115% over the same period of 2007 (€0.40 million). 

The taxation charge for the period was €0.28 million (H1 2007: €0.06 million).

Consistent with previous accounting periods, the profits of the Group are expected to be higher in the second half of the year than the first half, due to the increased volume of sales of the Group's own products and services to large private sector customers rather than to public sector customers, producing higher profit margins for the Group.   

Basic earnings per share grew by 33% to €0.004 (H1 2007: €0.003).

Globo plc's balance sheet, as at 30 June 2008, reflects a net asset position of €12.16 million. Total assets were €30.88 million (H1 2007: €19.97 million). Of total assets, €11.4 million were held in non-current assets, €16.98 million were held in inventories, trade debtors, prepayments and other current assets and €2.50 million were held in cash and cash equivalents. Total liabilities increased by 36.1% to €18.72 million.

Accounts receivables and prepayments increased by €4.93 million primarily because of the higher volume of trading and the lengthy duration of large public projects that the Group gained in the last 12 months. However, the Group expects that the majority of the outstanding amounts will be fully recovered within 2008.

Cash used in operations was €0.12 million due to the increase in receivables, while net cash used in investing activities was €2.97 million reflecting the significant investment in product development and infrastructure.

  CONSOLIDATED INCOME STATEMENT

For the 6 months ended 30 June 2008

 CONSOLIDATED BALANCE SHEET

At 30 June 2008

 CONSOLIDATED CASH FLOW STATEMENT

For the 6 months ended 30 June 2008