ACV Advance Visual

RNS Number:8674N
Advance Visual Communications PLC
29 November 2001



29 November 2001 - Embargoed - 0700


            Advance Visual Communications PLC to focus on UK only

                           ("AVC" or the "Company")


 Appointment of AVC as reseller of Blackberry wireless e-mail solution by BT
                    Cellnet (separate announcement today)


Highlights:


  * AVC to focus its operations in the UK, its strongest market

  * Closure of operations in France, Germany and Switzerland, reducing staff
    numbers from 70 to 25

  * Restructuring to provide annualised savings in operating costs of #2
    million

  * Resignation of Professor Rae Earnshaw as non-executive director and of
    Alexandre Sabeti as executive director

  * AVC appointed as reseller of Blackberry wireless corporate e-mail
    solution by BT Cellnet



AVC announces today that due to current market conditions and associated
losses it can no longer finance its holdings in continental Europe and instead
will focus its entire operation on its strongest market, the UK. The decision
was reached after thorough investigation of other strategic options.


Companies wholly-owned by AVC outside of the UK have been notified that no
further financial support can be granted to them.


Subsequently, Advance eProductions SAS in Sophia Antipolis, France and Advance
Visual Communications GmBH in Berlin are each in the process of filing for
liquidation in their respective jurisdictions.


Advance Visual Communications SA in Geneva, Switzerland and Advance Visual
Communications New Media BV in Amsterdam (a non-operational holding company)
have opted for voluntary closure.


Heads of Agreement have been signed with Advance Visual Communications SARL in
Paris (SARL-Paris) for a management buy out of SARL-Paris from AVC. The
transaction under discussion is share based whereby the Paris based management
will purchase 100% of the shares of SARL-Paris for 923,076 shares in AVC they
currently hold. Outstanding debt to AVC from the SARL-Paris will also be
written off. If the transaction does not materialise, the liquidation of
SARL-Paris is probable.


The remaining UK based operations will be reorganised and as part of this
process, Advance Internet Solutions Limited, a dormant non-operational
subsidiary of AVC, will be wound up.


Professor Rae Earnshaw, non-executive director, and Alexandre Sabeti,
executive director, have resigned from the AVC board with immediate effect.


Overall, staff will be reduced from 70 to 25, including a reduction in head
office numbers. The reduction in operational costs is estimated to be more
than #2 million per annum, which is in addition to previously announced
cost-cutting measures which amounted to #1.3 million per annum. Despite a
reduced turnover, the restructuring is expected to diminish AVC's operating
losses and enable the current cash balance to finance operations beyond its
year-end of 30 June 2002.


Going forward the Group will focus on Advance Digital Productions Limited in
Bradford and Advance London Limited (previously xoo), providing Internet,
Digital Video, Multimedia and Events services to AVC clients. The existing UK
operations generated #1,152,000 of revenues in the year ending 30 June 2001,
compromising 56% of the group's overall revenues. The Board anticipate a
further restructuring of the trades of these two entities in order to improve
client services and reduce administrative burdens.


The remaining revenues generated by non-UK operations will cease as of the end
of November 2001.


BT Cellnet has appointed AVC as a reseller of the innovative Blackberry
wireless email solution. This appointment is detailed in a separate statement
announced today. A new UK based company will be formed to lead AVC's entry
into the rapidly growing wireless enterprise data market and supplement the
group's UK based revenues.


Massoud Amiri, CEO of AVC, commented:


"Difficult market conditions have forced us to part with many exceptional
colleagues and we will miss the privilege of working with them. Additionally,
I would like to thank Rae Earnshaw and Alexandre Sabeti for their support and
guidance as directors over the past years."


"AVC is now a smaller company that is more flexible and focussed. We are in a
stronger position to weather the difficult trading conditions by concentrating
on the UK, which historically has been our most lucrative market. All our
efforts will be directed towards driving revenues and reaching profitability.
Ultimately, survivors within our sector will enjoy a less crowded but more
vibrant market in both Internet and Wireless services."


                                   - Ends -


Enquiries:


Massoud Amiri, CEO Advance Visual Communications, 0207 554 8680


David Rydell/Billy Clegg, Bell Pottinger Financial, 0207 861 3867

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