TTP Communications announces its interim results for the six months ended 30 September 2003

October 23, 2003

FINANCIAL HIGHLIGHTS

• Group revenues down 7% to £21.1m (2002: £22.7m);
• Pre-tax loss £5.4m (2002: £3.0m profit);
• EPS 2.511p loss (2002: 1.003p profit);
• Operating loss pre-goodwill at TTPCom Limited £3.3m in line with August trading update (2002: £4.9m profit);
• Sales revenues at ip.access £924,000 (2002: £156,000);
• ip.access operating loss – pre UITF 17 and goodwill charge - £2.1m (2002 £2.2m);
• R&D investment, including ip.access, increased by 16% to £11.7m (2002: £10.1m).

BUSINESS HIGHLIGHTS

• 10 new licences signed including further 6 for GPRS bringing total GPRS licences signed to date to 40;
• Our EDGE modem achieved 216 kbits/s in testing. First EDGE licence sold to handset manufacturer;
• 3 new licences sold by Terminals business - total number of terminal customers has now reached 9;
• The number of handsets incorporating TTPCom technology continues to grow from approximately 8m - 10 m last year to 20m - 25m this year;
• Signed a bundled software licence including GPRS, AJAR and our first 3G licence, to an Asian handset manufacturer in October;
• Integration of Mobisys is proceeding as planned with sales and operating profits significantly higher than last year;
• Investment in Synergenix and integration with our own gaming platform announced in August with objective of developing a non Java gaming standard;
• ip.access revenue growth in line with expectations. Signed long-term contract with T-Mobile Inc. for the US market in October;
• Our regulatory testing joint venture, 7 layers UK, continues to grow profitably.

Commenting on the results, Dr Tony Milbourn, Managing Director said:

“I am pleased to say that, after a challenging six months for TTPCom Limited, the business is recovering as we expected. While we anticipate that TTPCom Limited will be profitable taking the year as a whole, TTP Communications plc is unlikely to return to profitability until next year. However this reflects the ongoing investment at ip.access, which has made a particularly encouraging start to the year. Its sales revenues are in line with what we expected at the half year and the business is on track to break even next year. Looking forward, I continue to believe that we will be as successful in 3G as we are in 2/2.5G and that our strategy of getting more technology into more handsets will put the business in a strong position going forward. We are therefore confident that the long-term growth potential of the Company therefore remains unchanged.”

For more detailed information, see here.