EKY Ekay

    Ekay PLC (`Ekay' or the `Company')

APS Group of Companies (`APS') - Client solvency issue

Ekay undertakes media buying for the majority of its clients on a prepaid
basis. Historically, however, Ekay has traded successfully with a number of
clients on terms which involve Ekay extending a certain amount of credit to
those customers. Such terms have historically been extended to the APS group of
companies with the credit amounting on average to between �800,000 and �1m at
any one time. Since 1 July 2005, all trading with APS has been undertaken by
our quasi-subsidiary, Docklands Holdings Limited (`DHL').

The APS group of companies consists principally of APS Mortgages (UK) Limited,
a company incorporated in England and Wales and based in Swindon and APS
Mortgages Limited, a company incorporated in Jersey operated by partners and
staff of HLB Jackson Fox Chartered Accountants.

We were informed during August 2006 by APS that it had run into certain
financial difficulties and following discussions with both the UK and Jersey
directors of the relevant APS entities a plan for paying down the amounts due
to Ekay was agreed with APS, under which payments continued until early
December 2006.

Further time was extended to enable the APS to refinance but unfortunately it
would appear that this has proved unsuccessful and last week we commenced High
Court proceedings against APS Mortgages (UK) Limited for recovery of the debt
due from that company.

Additionally, a meeting was held in Jersey last week between Ekay and APS
Mortgages Limited to discuss the outstanding debt due from APS Mortgages
Limited. Following that meeting we were notified that due to uncertainty
concerning whether or not funding from APS Mortgages (UK) Limited and support
from DHL would be available, APS Mortgages Limited had ceased to trade. DHL has
therefore notified the directors of APS Mortgages Limited that they should
commence a creditors winding up or place the company in desastre (a form of
bankruptcy proceedings in Jersey). A meeting of the directors of APS Mortgages
(UK) Limited is being held today to consider this.

The total amount due to Ekay and DHL from APS is approximately �1.65m inclusive
of interest charges for late payment. The increase from the average was due to
the unwinding of media commitments ending in August 2006.

The directors of Ekay intend that they should pursue vigorously the outstanding
amounts due to the Company, using all available means.

A provision with regard to the outstanding amounts may be required to be made
in the financial results for Ekay for the 12 months ended 30 June 2007. We will
by the end of this month be announcing our interim financial results for the 6
months ended 31 December 2006, at which time we will (or sooner if appropriate)
provide an update on any significant changes with regard to the outstanding
amounts due from the APS Group. Shareholders will be notified of developments
as they arise.

Procedures have since July 2005 been implemented to ensure that credit is only
extended to clients where the sums due are adequately covered by credit
insurance except with a small number of historic customer accounts. Ekay does
not currently trade with any other account on credit terms not adequately
covered by insurance.

                                                                   5 March 2007

Enquiries:

Ekay plc                               Tel: 01474 334343                     
                                                                             
Eddie Powell, Chief Executive                                                
                                                                             
Shore Capital & Corporate Ltd          Tel: 020 7408 4090                    
                                                                             
Guy Peters                                                                   
                                                                             
Nexus Financial Ltd                    Tel: 020 7451 7068                    
                                                                             
Nicholas Nelson                        Nicholas.nelson@nexusgroup.co.uk      



END

Ekay (LSE:EKY)
Historical Stock Chart
From Jul 2024 to Jul 2024

Ekay (LSE:EKY)
Historical Stock Chart
From Jul 2023 to Jul 2024