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Fidelity Systems PLC (FID)

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Thursday 25 September, 2008

Fidelity Systems PLC

Half-yearly Report


                             FIDELITY SYSTEMS PLC                              

            INTERIM RESULTS FOR THE SIX MONTHS TO 31ST AUGUST 2008             

Despite the financial sectors current doom and gloom attitude I am pleased to
be able to report further strong growth resulting in a significant increase in
profit during the first half of the financial year to 31st August 2008.

BRIEF FINANCIAL RESULTS

Pre tax profits increased to GBP 201,138 from the previous periods GBP 189,970
an increase of 5.9% with a turnover of GBP 748,443. Gross profit margins rose
to 80.7% compared to 69.8% for the previous period, an increase of 10.9%.

Earnings per share have increased to 0.67p from last year's 0.63p

Our balance sheet continues to remain healthy even after the interim dividend
payment of GBP 107,500 leaving a cash balance of GBP 762,523 as of 31st August.

OPERATING REVIEW

The first half of our financial year has seen further University orders, with
installations taking part over the summer. New Universities added to our
existing client list have included Bangor, Suffolk, Northumbria, Bournemouth
and Bolton with a further seven existing University clients having new hardware
and software installed. In total Fidelity now has its EPoS hardware and
software in a total of fifty seven universities and colleges in the UK.

Fidelity's software developers have not been idle, with orders in excess of GBP
60,000 for bespoke software.

As part of our collaboration with the East Riding of Yorkshire Council (ERYC),
Fidelity was awarded a contract in excess of GBP 20,000 for the installation of
new Electronic Point of Sale (EPOS) hardware and software for the Spa Theatre
in Bridlington which reopened in July after a complete rebuild costing in
excess of GBP 20m. A further contract from the ERYC for in excess of GBP 30,000
was for software upgrades to its SureCard Leisure Centre system to enable
residents to be able to use the newly introduced senior citizens bus pass to
gain access to its estate of ten Leisure Centres. This new scheme introduced by
the government in April 2008 utilises smart cards with photo ID and Fidelity
have successfully upgraded the councils system to be able to accept both
magnetic cards and smart cards.

For over three years, Fidelity have worked closely with Mettler Toledo, a
global player in the industrial and food weighing machines field with a
turnover in excess of USD 1,794m. Mettler awarded a contract for in excess of
GBP 10,000 for further development work on the Fidelity touch screen based
software we designed for them for use on their range of PC based retail scales.

RESEARCH & DEVELOPMENT

We have two new products destined for launch in the first quarter of 2009. The
first is a completely new suite of EPoS back office software. This is a high
end product which will enable us to attack a much larger corporate market as
well as giving us opportunities to upgrade our existing clients. The second is
the SQL version of our existing Instant Loyalty software. Similarly to the EPoS
software this new version will enable us again to approach larger clients
particularly in the education sector. We have partnered with a UK manufacturer
of cashless wall mounted revaluers and vending machine hardware to launch an
updated version of our cashless solution aimed at schools, colleges and
Universities. This is due for launch in November.

OUTLOOK

Despite the so called credit crunch, Fidelity's first half of the year has
started in a positive manner. Our clients mostly include the educational sector
and local authorities which themselves seldom seem to be affected by market
forces. Post interims, the only dramatic move I've taken has been to transfer
the companies cash reserves from HBOS into other banks including Northern Rock
who's funds are allegedly 100% safe being backed by the government.

I look forward to being able to report further progress in the final half of
our financial year.

Paul Lowsley

Chairman

26th September 2008




GROUP PROFIT & LOSS ACCOUNT

                                            Half Year              Half Year

                                            31.08.08               31.08.07

                                            unaudited              unaudited

                                            GBP                    GBP

TURNOVER                                    748,443                815,591

Cost of Sales                               144,133                245,969

GROSS PROFIT                                604,310                569,622

Administration Expenses                     422,924                394,895

OPERATING PROFIT / LOSS                     181,385                174,727

Interest Receivable                          19,753                 15,243

PROFIT / LOSS ON ORDINARY ACTIVITIES        201,138                189,970

EARNINGS PER SHARE                           0.67p                  0.63p

The interim accounts and comparative figures have been prepared on a basis of
accounting policies consistent with those used in the Group's audited accounts
for the year ended 28th February 2008. The financial results have not been
audited.


                                                                                                                                            

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