At that time, the Board mentioned that second half trading would show an improvement on the first half and that the Company would be looking to be breakeven for the year, dependent upon the timing of deals and income recognition.

As discussed in September, the Company's second half trading performance has been strong and revenues for the second half are expected to show an improvement on the first half. The Board continues to see strong demand for its products and services and a healthy pipeline of opportunities, particularly in the Financial Services sector. The services side of the business has performed well in 2005, with particular success in cost control services, especially within Market Data and Derivatives Control, where business has been won both on the buy-side and sell-side.

Given this encouraging market background, the Board has also taken the decision to open an office in New York. The investment in opening this office, as well as the one off costs associated with merging the two businesses that form the BCS Group, floating on AIM by way of the reverse acquisition of Honeysuckle Group plc, building up the Romanian software development office and investing in new products mean that it is likely that BCS Group will announce a loss for the full year. Having said that, the second six months post the reversal on to AIM show a significant return to profitability, including the investments in products and the New York office.

New York opening

As referred to above, since the interim results, the Board has also agreed terms which will see the opening of the BCS New York office in January. The office will be based in Broad Street, just off Wall Street. This office is being established to support our existing global Investment Bank customers and also to focus in on North American prospects which have historically been run from the UK.

We also have appointed Andy Moylan as the Head of North America. Andy is an American national and was previously a senior partner at Deloitte Consulting. He was responsible for the consulting services provided to the firm's largest and most complex clients in the financial services industry. For the last five years he led a team of partners in providing services to Merrill Lynch. Andy had been the partner in charge of the Northeast Region Financial
Services practice of Deloitte and the head of the Securities Industry Practice. Other major clients he advised included Charles Schwab, Bank of America and MetLife.

Nigel Walder, Chief Executive commented, "BCS has achieved a lot this year and has had to cope with a significant amount of change. This change has all been positive for the business and the management team are now focused on making sure 2006 meets our expectations. We continue to see strong demand for our products and services and the strength of our order pipeline gives us confidence in the prospects for the Group as a whole."

Contract win

Today, BCS Group has announced a contract win with International Financial Data Services (IFDS) around the deployment of the BCS Operational Control Architecture and the new BCS Risk module, combined known as BCS RiOCA. This is an important development given one of the Group's key differentiators is having an integrated architecture for Operational Risk, Operational Control and Regulatory Control. Revenues from this deal will be spread across 2005 and 2006.