Innovative Software Direct plc
LSE : ISDP

June 16, 2008 05:38 ET

Announcement of Strategic Developments

                           INNOVATIVE SOFTWARE DIRECT PLC ("ISD" or "The Company")
                                   Announcement of Strategic Developments




ISD  operates through subsidiaries Powerdial Systems Limited ("Powerdial") and IS Direct Limited  ("Direct").
Its  expertise  is  in  network  systems and software.  Its strategic aim is to  deliver  business  solutions
providing  clients  with  maximum control over the performance and integrity of their Information  Technology
networks.  Its solutions include:

          ▪ Installation and Support
          ▪ Quality and performance
          ▪ Software Legality
          ▪ Security of networks and data
          ▪ Control of IT asset inventory
          ▪ Environmental and carbon footprint improvements


In pursuit of this objective, the Company makes the following announcements: -

VARIATION TO THE ZENmetrics(TM) DISTRIBUTION CONTRACT

ISD  has  negotiated an enhancement of its distribution agreement with 413 Technologies for their ZENmetrics(TM)
product.   The  agreement now provides non-exclusive distribution rights covering the whole  of  Europe.   In
return, ISD has relinquished its exclusive rights to the product in the UK.

NEW AGREEMENT WITH SCANITT

ISD  has  secured  an  agreement with ScanITT for the exclusive UK distribution of  their  network  software,
together  with an option to purchase the intellectual property rights.  The agreement positions  the  company
ideally  in  the  rapidly growing market for Business Solutions/Applications. The product fits  totally  with
ISD's strategy of delivering to clients the maximum visibility and control over their investment in IT.

      ScanITT monitors network infrastructure from an internal perspective. It delivers the clients with
      the  ability to monitor, change and control their IT estate and to obtain accurate information  on
      its value, age and security
      
      ScanITT offers a quick-response, compartmentalized solution; a reliable source of technical help
      
      ScanITT  will  be  marketed into four main segments, corresponding to what industry  experts  have
      identified as the primary opportunities for network consulting:

          ▪ Specific Requirements and Front End Sales - an area in which Powerdial specialises. ScanITT will 
            be positioned as a Business Solutions Tool

          ▪ Technical support on contracted term agreements - the traditional form of support, including
            solutions, software upgrades, and network reporting

          ▪ Project contracting - forming part of Powerdial's consultancy package for major IT purchasing
            decisions, Corporate acquisitions, asset valuations, licensing compliance, system/network 
            installation and testing, etc

          ▪ Outsourced Sales - sold as a systems component to Global Players and Outsourced IT/Management
            providers

AGREEMENT OF HEADS OF TERMS

ISD  has  agreed  Heads  of  Terms to acquire a major UK provider of environmental monitoring  equipment  and
software applications.  These alert the client quickly to issues in the IT estate and beyond:

          ▪ The products and solutions have a unique feel and design which give them a competitive edge

          ▪ Within the IT channel the company has built up a reputation for product reliability, manufacturing
            excellence and outstanding customer service

          ▪ The products and applications monitor environmental conditions that impact the performance levels 
            of all IT equipment as well as other key areas of a business. As can be seen from the external 
            pressure exerted by Government Agencies, "Carbon Footprint" is high on most agendas and the aim 
            of ISD Group is to have such solutions in its portfolio.

POWERDIAL EXPANSION

Powerdial  Systems  has  begun  the planned expansion of its operations in IT  Hardware  and  the  associated
services markets:

         ▪ The sales-team has now been expanded to double the size it was at the date ISD acquired Powerdial 
           on 21st December 2007

         ▪ New markets are opening to the Powerdial division which will have a significant impact upon sales 
           in the coming years. These include Video Conferencing and IPTV (television across a data network)

         ▪ The directors are looking to strengthen Powerdial's Management team and incorporate all the new ISD
           Group solutions into its existing client base
         
         ▪ Trading in the current financial year to 31.12.2008 is ahead of expectations

OVERVIEW OF SYNERGIES

Environmental solutions are a rapidly growing market segment because of Governmental pressures on business to
develop  a  "green  policy" and reduce carbon footprint.  This impacts other areas.   An  instance  is  Video
Conferencing, where the market will grow hugely as costs fall.  In addition, however, sales will be driven by
external factors such as concern about Carbon Footprint and increased costs of travel.

ScanITT  and environmental monitoring both deliver solutions from a network perspective.  All of the  clients
of  the  company  with  whom we have exchanged Heads of Terms are potential customers for  both  ScanITT  and
Powerdial, and vice versa.

Powerdial  provides most (if not all) of the equipment that ScanITT and the environmental  applications  will
monitor.  They  offer a "One Stop Shop" and can deliver everything that a client requires for their  network,
whether voice, data or image:

        ▪ External services such as ADSL (Broadband), Calls, Lines and Wide Area Networks
        ▪ Equipment and design services for Local Area Network
        ▪ Voice over Internet Protocol (VoIP) equipment and consultancy
        ▪ Business Applications
        ▪ Monitoring and control solutions

As  a  result  of  the synergies within its portfolio, ISD is able deliver cost savings to its  clients  from
certain of its offerings that offset the cost of other parts

APPOINTMENT OF AUDITORS

ISD  has  appointed  Tenon  Group as its Auditors.  Tenon are in the course of reperforming  the  Audits  for
2005/6/7.  The results of this review are now at Draft stage and will be published shortly.  The Directors do
not expect any material changes to the Company's net assets at 30 June 2007.



The Directors of the Company accept responsibility for the above announcements.

Contact Information

  • Innovative Software Direct plc