Press release

Amsterdam November 28, 2007

TIE: Fourth Quarter and Annual Results

Master Data Management Software Company TIE Holding N.V. (“TIE”) listed on the EuroNext Amsterdam Stock Exchange hereby publishes it's Fourth Quarter 2007 Unaudited Condensed Consolidated Interim Financial Statements which include the Annual Results for the year ended September 30, 2007.

TIE reports Fourth Quarter 2007 Revenues of EUR 2,4m and Net Income of EUR -2,7m (2006; EUR 1,7m). Revenues are comparable to Fourth Quarter 2006 revenue (EUR 2,4m) and on par with the EUR 2,4m reported previous quarter. Full year revenue amounts to EUR 9,7m (2006; EUR 8,4m) and net income year to date amounts to EUR -3,3m (2006; EUR 1,0m).

Net income includes considerable impairment charges amounting to approximately EUR 2.0m pertaining to the assets of the Netherlands operating segment.

An agreement was reached with the landlord of the Netherlands offices terminating the lease as per March 31, 2008. Lowering the lease costs for the offices is an important first step to improve the results of the Dutch operations.

Revenues increased in The Netherlands by 5% compared to the fourth quarter 2006 and North America in EUR by 4%. The Rest of World however was down by 23%. Full year revenues are up 15% to 9.7m.
License revenue was down by 33% compared to the fourth quarter of 2006, SaaS revenues however were up by 42%, 16% of which was actual growth, the remainder is related to the one time effect of a reclassification of revenues between Consulting and SaaS with no bottom line effect which was processed in the fourth quarter. This reclassification drives the decrease in Consultancy revenue which was actually up by 9%. Other income for the fourth quarter amounting to EUR 133k originates from participation in European Commission supported projects.

Operating expenses have increased by 90% over the Fourth quarter compared to previous year, for the full year by 39%. The main driver behind this development is a onetime impairment charge taken in the fourth quarter of 2007. For the full year 2007 the acquisition of Digital Channel and the expansion of the Company's management structure accounted for the increase in expenses.

The Company has found it necessary to impair all intangible assets on the balance sheet of the Netherlands operating segment, resulting in a onetime charge to income amounting to EUR -2,004k. The assets impaired include part of the Digital Channel Goodwill, the Digital Channel Trademark and capitalized R&D expenses. This impairment charge is presently still under review by the Company auditors. The audit of the financial statements will not be completed until February 2008. The impairment charge may require adjustment at that time. Net income therefore amounts to a loss of EUR -2,720k for the quarter, EUR -3,334k for the full year. Prior year comparatives amounted to EUR 1,668k and EUR 1,041k respectively.

Shareholder's Equity amounted to EUR 1,3m, with Equity totaling EUR 2,2m (2006: EUR 4,8m). The net cash position of the Company as per September 30, 2007 amounted to EUR 219k. The credit facility was drawn to an amount of EUR 326k on September 30, 2007 (2006: EUR 195k).

Management secured adequate cash flow by entering into a one year funding agreement with the Alto Imaging Group NV amounting to EUR 500k. This debt agreement was signed on November 28, 2007.

Jan Sundelin, acting CEO said: “We have been through quite an emotional period with respect to Dick Raman resignation at the request of the Supervisory Board. The Company has been getting its focus straight now and we have launched a number of specific high added value solutions for our customers under our MDM product Suite TIE Kinetix. These include a comprehensive Data Quality Solution and a topic on every Executive Board's agenda these days, being eInvoicing. Especially eInvoicing offers great opportunities to reduce operational costs, improve efficiency as well as improve the quality and effectiveness of internal control. We are looking forward to presenting these offerings to our clients.”

Further details with respect to these Fourth Quarter Results can be found in the separate Condensed Consolidated Interim Financial Statements for the three month period ended on September 30, 2007, which are attached hereto. These Condensed Consolidated Interim Financial Statements and the annual results reported therein are unaudited. The audit of the Company's Financial Statements will not be completed until the publication thereof in February 2008.

Agreement with Landlord in The Netherlands

TIE reached an agreement with the landlord of the TIE offices in the Netherlands, that effectively terminates the current lease per March 31, 2008. The original lease would have ended May 2010. The net income effect of the agreement amounts to EUR 300k for 2008 (2009; EUR 345k), realizing sizable cost savings for the Company. The short term impact on cash flow is even greater, EUR 465k for 2008, with little effect in 2009 compared to previous arrangement.

A final settlement payment by TIE amounting to EUR 400k is due December 31, 2008. Alto Imaging Group NV, currently shareholding in excess of 24%, has acted as a guarantor for the amount payable referred to above. TIE maintains an option to extend the lease as per March 31, 2008 under revised terms and conditions. Should TIE choose not to exercise this option Alto Imaging Group NV has the option to lease the office space currently occupied by TIE.

Jan Sundelin, acting CEO of TIE says: “This is the first step forward in creating a cost effective organisation and of great motivational importance to all of our employees and stakeholders. The lease agreement was part of our heritage, dating back to the IPO. Reducing costs and cash outflow significantly through this agreement is an important step toward profitability, will improve our operational cash flow and reduce our risk exposure.”

Peter van Schaick, MD and owner of Alto Imaging Group NV and member of the Supervisory Board of TIE says: “I wish to express my personal commitment to TIE and my confidence in the TIE product suite and its future success. Contributing positively to TIE's future by assisting in this arrangement is a logical consequence.”

About TIE

TIE bridges the gap between online and traditional business, and helps industry and supply chain partners achieve electronic business collaboration without limitations. Our solutions are proven to lower costs, increase sales, optimize business processes, and improve efficiency while removing the barriers to eBusiness information exchange. Because we have decades of experience to share, TIE remains a key contributor to the development and implementation of global eBusiness standards. Today we are the partner that industry leaders turn to for business-to-business success. TIE is a publicly held company with offices in the United States, France, and the Netherlands.

Further information:

End of press release

Download: 4th Quarter Results (PDF, 64 KB)