Results for the six months ended 31 October 2009

Accident Exchange Group Plc announced its unaudited results for
the six months ended 31 October 2009 on 30 December 2009.

Key Points

Financial :

• Adjusted* revenue: £64.3 million (2008**: £85.0 million).
  
  
• Adjusted* profit before tax: £4.0 million (2008**: £2.4 million).
  
  
• Net exceptional costs and other items: £10.5 million (2008: £18.8 million).
  
  
• Reported revenue: £61.6 million (2008**: £85.0 million).
  
  
• Reported loss before tax: £6.5 million (2008: profit of £16.4 million).
  
  
• Total net debt reduced to £144.3 million (31 October 2008: £174.0 million). 

* Adjusted revenue and adjusted profit before tax are stated before exceptional items, amortisation of acquired intangible assets, cost of share-based payments and change in fair value of derivative financial liability.
** Restated as per note 2 to the financial information in the Interim report.

Operational :

• Reached agreement with a leading insurance group to fix the cost of our credit hire services in return for improved payment terms and reduced frictional administration.

• Strategic refocus and cost reduction programme commenced shortly after the half year end.

• Refocusing on higher margin automotive and manufacturer led referral partners. Annualised cost savings of £24 million targeted by the end of the current financial year at an estimated cost of c. £2 million to be incurred in the second half of the current financial year.

• Secured two significant new prestige manufacturer referral contracts.

• Litigation continues against Autofocus and certain of their employees.

• Reduced cash collections and increased under-recoveries in period attributed to insurers’ use of subsequently discredited Autofocus rate evidence.

• Supplied rental vehicles to 19,900 customers (2008: 18,700 customers).

• Recorded 585,000 rental days (2008: 570,000 rental days).

• Fleet Utilisation: 66% (2008: 60%).

On outlook, David Galloway, Non-Executive Chairman, stated:

“The financial crisis and the recession that has followed have altered operating conditions, imposed new challenges and exacerbated existing ones. Having discovered the systemic dishonesty in Autofocus’ rate evidence during the period, we are pursuing a legal remedy against them and have also made some progress in accelerating claim settlement by improving the subsequent engagement of insurers and their defendant solicitors. Much remains to be done, however, and your Board is focused upon the recently announced strategic refocus and delivering the anticipated cost reductions."

30 December 2009