GLOBAL GRAPHICS SE (NYSE-Euronext: GLOG), experts in developing e-document and printing software, provides a trading update for the third quarter and the first nine months of the financial year ending 31 December 2013.

HIGHLIGHTS

• Two new gDoc partners signed: licensing gDoc Platform to provide electronic document solutions.
• New version of the Harlequin RIP launched to OEM partners targeting the commercial print markets.
• Completion of the liquidation process of Global Graphics Software (India) Private Limited in late September 2013.

KEY FINANCIAL INFORMATION

Quarter ended 30 September 2013

• Sales of Euro 2.5 million this quarter (Euro 2.9 million at Q3 2012 exchange rates) compared with Euro 2.7 million in Q3 2012, or a decrease of 8.5% at current exchange rates, but an increase of 5.2% at constant exchange rates.
• An adjusted operating profit (EBITA) of Euro 0.3 million this quarter, compared with an adjusted operating profit of Euro 0.4 million in Q3 2012.

Nine-month period ended 30 September 2013

• Sales of Euro 6.1 million in the first nine months of 2013 (Euro 6.7 million, using exchange rates prevailing during the first nine months of 2012) compared with Euro 7.2 million in the first nine months of 2012, or a decrease of 14.8% at current exchange rates and 7.3% at constant exchange rates.
  Sales reported for the nine-month period ended 30 September 2013 include the royalty revenue referred to under note 2b (iii) of the Board’s report on operations for the financial year ended 31 December 2012, which is included in the Company’s annual financial report for that year.
• An adjusted operating loss (EBITA) of Euro 0.6 million the first nine months of 2013, compared with a nominal adjusted operating profit in the first nine months of 2012.

Cash position as at 30 September 2013
The Company had no outstanding debt and a cash position of approximately Euro 0.8 million as at 30 September 2013, compared with a net cash position of approximately Euro 1.6 million and Euro 2.3 million as at 30 September 2012 and 31 December 2012, respectively.

Segment sales analysis for the quarter and the nine-month period ended 30 September 2013

MANAGEMENT’S COMMENTS
Gary Fry, Global Graphics’ Chief Executive Officer, comments, “I am pleased to report that we produced a stronger financial performance in the third quarter as expected.

 “During the quarter we signed two new gDoc partners who are licensing our gDoc Platform to create solutions for vertical markets.  As I have previously stated we have realigned our gDoc commercial model to prioritize working with OEM, system integrator and software vendors and are aiming to accelerate the rate at which we recruit new partners.

“We announced Version 10 of the Harlequin RIP in August ahead of the Print 13 trade show in Chicago which took place in September.  Version 10 adds a range of new features to enable print shops to grow into digital printing and has been well received by our OEM partners who are now working to upgrade their customers.

“With regard to our cash position at the end of the quarter, it is lower than anticipated but this is entirely due to the timing of revenue occurring near the end of the quarter and we expect it to increase during the current quarter.”

SPECIAL AND GENERAL MEETINGS OF THE COMPANY’S SHAREHOLDERS
A special meeting of those shareholders holding shares of the Company to which a double voting right is attached is scheduled today at 14.00 CET at the Hôtel du Châtelain, 17 rue du Châtelain, in Brussels (Belgium).

This meeting will be followed by an ordinary and extraordinary meeting of the Company’s shareholders, notably to vote on the proposed transfer of the Company’s registered office to the UK (the “Proposed Transfer”), which is scheduled at 14.30 CET also at the Hôtel du Châtelain.

The respective agendas and proposed resolutions for these meetings of the Company’s shareholders are available on a dedicated page of the Investor section of the Company’s website at: http://www.globalgraphics.com/investors/18-october-2013-meetings/

Attached as an appendix to this press release is a summary of applicable legal and regulatory provisions with respect to the repurchase of shares held by a shareholder of the Company opposing the Proposed Transfer, notably outlining the conditions to be met for a share repurchase request made by a shareholder to be valid.

RESULTS FOR THE QUARTER AND THE FINANCIAL YEAR ENDING 31 DECEMBER 2013
Global Graphics expects to announce its consolidated results for the quarter and the financial year ending 31 December 2013 on Wednesday 12 February 2014 before market opening.

Editors notes

About Global Graphics
Global Graphics (www.globalgraphics.com) is a leading developer of e-document and printing software. Its high-performance solutions are at the heart of products from customers such as HP, Fuji Xerox, Agfa, Corel and Quark.

Forward-looking statements
This press release contains, in addition to historical information, forward-looking statements that involve risks and uncertainties. These include statements regarding the Company’s growth, funding, expansion plans and expected results for future periods.
Such statements are based on management’s current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Although management believes that their expectations reflected in the forward-looking statements are reasonable based on information currently available to them, they cannot assure any reader that the expectations will prove to have been correct. Accordingly, any reader should not place undue reliance on these forward-looking statements.
In any event, these statements speak only as of the date of this release. The Company undertakes no obligation to revise or update neither any of them, neither to reflect events or circumstances after the date of this release, nor to reflect new information nor the occurrence of unanticipated events.

Summary of applicable legal and regulatory provisions with respect to the repurchase of shares held by a shareholder of the Company as part of the Proposed Transfer

Condition #1: Not having voted for the Proposed Transfer on 18 October 2013
In accordance with the provisions of the third paragraph of article L.229-2 of the French Commercial Code, shareholders having expressed their opposition to the Proposed Transfer on 18 October 2013, either by voting against the Proposed Transfer resolution, or by having abstained while taking part in the vote on that resolution, may be entitled to request the repurchase of their shares by the Company.
On the contrary, shareholders who did not participate in the 18 October 2013 meeting or who approved the Proposed Transfer on that date will not be entitled to request for their shares to be repurchased by the Company.

Condition #2: Filing a formal share repurchase request with the Company
In accordance with the provisions of article R.229-6 of the French Commercial Code, for being valid, the confirmation of a shareholder’s opposition to the Proposed Transfer and the formal share repurchase request will have to be filed by the shareholder with the Company:

• within a 30-day period starting on the date when the last of the two notices the provision of which is required by article R.229-5 of the French Commercial Code (i.e. the publication of a notice on the Proposed Transfer in a legal gazette as well as in the Bulletin des Annonces Légales et Obligatoires (BALO) is published.
  Both notices are expected to be published on Friday 25 October 2013. In any case, the Company will publish the starting and ending dates of that 30-day period through the issue of a press release, at the latest on the day when the last of these two notices will be published.
• by way of a registered letter which will have to be sent for the attention of the Company’s Chief Financial Officer, to the Company’s registered office (located at 146 boulevard de Finlande, Z.I. Pompey Industries, 54340 Pompey, France).

Share repurchase offer sent by the Company to the shareholders
In accordance with the provisions of article R.229-7 of the French Commercial Code, the Company will send those shareholders meeting both conditions mentioned above a share repurchase offer by way of a registered letter and within a 15-day period following the receipt of the valid share repurchase request.
The share repurchase offer will include information on the price at which the shares will be repurchased as set by the Board on 30 September 2013 (i.e. Euro 1.80 per share), the proposed means of payment for those shares, the period during which the offer will be valid (which will be a minimum of 20 calendar days), as well as the place where the offer acceptance must be sent.

Dispute on the share repurchase price
Any dispute formed by a shareholder with respect to the share repurchase price will have to be brought to the competent court within the jurisdiction of the Appeal Court of Nancy, and within the period set by the share repurchase offer, in accordance with the provisions of article R.229-8 of the French Commercial Code.
In accordance with the provisions of the same article, should a dispute formed by one shareholder with respect to the share repurchase price be accepted by the court, this would put all other shareholders having filed a valid share repurchase request with the Company in the same position, as required by the provisions of article 331 of the French Civil Procedure Code.

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