Disposal and Trading Update

RNS Number:8381A
TripleArc PLC
03 April 2006


3 April 2006


                                 TripleArc Plc
                  ('TripleArc', 'the Company' or 'the Group')

                          Disposal and Trading Update


Introduction

TripleArc, the AIM listed, UK based provider of technology led print procurement
solutions acquired Stream GWC Group Limited ("Stream") in December 2004. Stream
consisted of two separate businesses, a high volume direct mail business (the
"Direct Mail Business") and a marketing solutions business consisting of
low-volume direct mail, database management, fulfilment, contact centre and
response management services (the "Marketing Solutions Business").

In the year ending 31 December 2005, the unaudited loss before interest, tax and
amortisation of Stream was #0.01 million on sales of #12.3 million. As at 31
December 2005 its unaudited net liabilities were #0.6m.

On 31 March 2006, TripleArc entered into a deed of amendment and variation (the
"Deed") with the original vendors of Stream to terminate the earn-out provisions
of the acquisition agreement (the "Earn Out"). This has enabled the Marketing
Solutions Business to be 'hived up' into the Group for a fair-value
consideration and for the entire issued share capital of Stream (consisting of
the Direct Mail Business) to be disposed of to Formpro Mail Marketing Limited
for a consideration of #1.00 (the "Disposal").

Background to the Disposal

The Marketing Solutions Business is directly complementary to TripleArc's
existing business model and fits strategically into the Group; the Direct Mail
Business, as a capacity manufacturer, less so.

As has been widely reported, conditions in the direct mail market have been
tough. In the year ended 31 December 2005, the Direct Mail Business was loss
making and as at 31 December 2005, it had net current liabilities of
approximately #0.9m.

Turning around the Direct Mail Business would have required substantial
investment and the Board therefore concluded that it was a logical time to
dispose of it. As a result of the Disposal, the Group will strengthen its
balance sheet and be able to entirely focus on driving more services to its
customers through the core Marketing Solutions Business without the distraction
of managing the loss making Direct Mail Business.


The Deed

Pursuant to the Earn Out, the vendors of Stream (the "Vendors") were due further
consideration up to #8.0 million dependent upon the performance of Stream for
the two year period ending 31 December 2006. In order to facilitate the
Disposal, the Company has entered into the Deed with the Vendors to terminate
the Earn Out obligations. Pursuant to the Deed, the Vendors will receive an
aggregate sum of #0.5 million in full and final settlement of their rights to an
Earn Out, effectively terminating the Stream acquisition agreement.

The Deed has allowed the Company to obtain full operational control of Stream
prior to the completion of the Earn Out period and to discharge all of its
future Earn Out obligations. This has enabled the Company to complete the
Disposal and will allow it to more effectively operate the Marketing Solutions
Business going forward.

In accordance with the AIM Rules the Vendors, being Mark Scanlon, Angus Steel,
Richard Fookes and David Palmer-Jeffery, as directors of a subsidiary of
TripleArc are all considered to be related parties to TripleArc in relation to
their participations in the Deed. In accordance with Rule 13 of the AIM Rules,
the Board considers, having consulted with the Company's nominated adviser, that
the terms of the Deed, are fair and reasonable insofar as the Company's
shareholders are concerned.

Trading Update

The Board is pleased with the progress the Company has made in 2006 and the
Group has continued to pay down its long term loan facility with HSBC. A payment
of #500,000 was made on the 31st March 2006 to reduce this facility further. A
new sales team has been brought in to drive new business growth whilst the
current sales resource will focus on driving revenue growth from our existing
customer base by selling additional services and solutions. This will be
enhanced by the integration into the Group of the Marketing Solutions Business.

Following the Disposal, the Company believes that it will be in a position to
announce its preliminary results for the year ended 31 December 2005 in May
2006. A further update on trading will be given at that time.

Commenting, Jason Cromack, Chief Executive of TripleArc, said:

"At the time of the acquisition of Stream, the high volume direct mail element
of the business was not regarded as central to our strategic plan. The Disposal
removes a significant liability on the balance sheet and distraction from the
TripleArc Group. The retained Marketing Solutions Business allows us to focus on
our strategy of driving revenue growth from our core customer base by providing
them with value added services and solutions that allow them to remove cost from
their supply chain.  The Disposal enhances this strategy and will enable us to
focus on delivering good profitable growth."


                                    - Ends -

For further information please contact:

TripleArc Plc                                                     0117 933 1006
Jason Cromack, CEO

Weber Shandwick Square Mile                                       020 7067 0700
Terry Garrett / Nick Dibden

Altium                                                            020 7484 4040
Garry Levin / Tim Richardson


Notes to Editors

Background to Stream

TripleArc acquired Stream (formerly HFS Projects Limited), a leading UK direct
mail fulfilment company employing around 240 staff on 31 December 2004. Stream
delivered 'data centric' marketing support and fulfilment services to a blue
chip client base in the automotive, mail order, publishing, financial services,
charity and leisure sectors. These services encompassed data management and
processing, response management services such as inbound and outbound call
handling and personalisation of statements and laser printed direct marketing
material.


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