Highlights:

• Revenues of 1.7 million Euros, in line with 2nd quarter 2004
• Operating expenses reduced by 11%
• Successful launch of new products portfolio
• 1.1 million Euros raised in July through a share capital increase
• Strategic deal signed with Pioneer Investments Management, Dublin

Revenues for the quarter were 1.70 million Euros, in line with the 1.73 million Euros recorded in the second quarter 2004. Operating expenses have been 1.55 million Euros, representing an 11% reduction versus last year's comparable quarter.

EBITDA losses for the quarter, before restructuring costs, were 154,399 Euros, including stock option expense charges.

From January 1st 2005 Brainpower applies the International Financial Reporting Standard (IFRS). The share-based compensation - which is a non-cash item for the Company - is recorded as an operating expense.

Rocco Pellegrinelli, CEO of Brainpower, commented: "Revenues for the quarter are a bit below expectations due to some contracts' slippage into the second half of 2005. The extended sales cycles of some selected large deals added a short-term variability to our business. However, our pipeline remains strong and well-diversified, supporting our growth objectives for the second half of the year. During the second quarter we have also been able to launch newly packaged versions of our products that significantly contribute to strengthening our leading position in the asset management financial software segment. The Pioneer deal, announced earlier this month, is a powerful validation of this product strategy. Right after the end of the second quarter we completed a capital increase of 1.1 million Euros. Now the company is in a strong position to execute its development plans."

Ermenegildo Beghé, CFO of Brainpower, added: "In the second quarter 2005 Brainpower cashed 850.000 Euros in the form of medium-term loans, in addition to the short-term bank credit lines already available to the Company. The share capital increase executed in July has further strengthened the financial structure of the Company, which now relies on additional financial resources to support its business plan."Download the document now 139.3 kb (Adobe Acrobat Document)