News Details

SimiGon Limited Trading statement

SimiGon Limited (“SimiGon” or “the Company”), a developer and global supplier of e-learning simulation software to the defence, aviation and industrial sectors, provides an update on trading since the announcement of its full year results on 20 February 2007.

In its planned expansion into new territories with non-military use of its core product the Company has had to delay a programme with a customer in the Far East to ensure compliance with applicable regulations.

In Europe, two customers have delayed their purchase of the Company’s D-Brief systems until next year. In addition the Company is seeing slower sales in its AirTrack products to the commercial airlines who are taking longer to upgrade their in-flight entertainment system.

As a result of these issues, the Company will see slower growth than expected for 2007. Although revenue for H1 2007 will be approximately 1.5M (2006 – 3.7M), revenue growth for the whole of 2007 is likely to be in the order of 15%, which is significantly below market expectations, while pre-tax profits are unlikely to reach the level of 2006.

Since the beginning of the year the Company has continued to leverage its core product SIMbox to increase market share in its existing markets and laid solid foundations in newer markets. The Company is now confirmed as the partner of choice to provide simulation training within Lockheed Martin’s winning bids for the UK’s Military Flying Training System and Singapore’s Basic Wings Course. The Company hopes to announce another such success with the Joint Strike Fighter programme in the near future.

Ami Vizer, Chief Executive Officer of SimiGon stated: “It is undoubtedly disappointing that much of the growth we had expected to see in 2007 has been pushed back. We are bidding, and bidding successfully, for contracts that are in some instances much larger than in previous years but the length of time for these contracts to be awarded is longer.

“However, SimiGon has made significant progress in its core business as it has established itself as the main supplier of simulation training in the world’s top three training programmes which could deliver stable long-term revenue streams.

“Although the growth in new territories is taking longer than anticipated, the Company has many opportunities in its core areas which gives us confidence in the long term growth prospects of the Company and our ability to deliver shareholder value.”