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Background checking company announces strong organic revenue growth

Financial Highlights:

&middot         Revenues increased by 43% to $5.24 million (H1 2013: $3.66 million)

•        Channel Partners and Consumer Reporting Agencies (“CRAs”) sales increased to $3.19 million (H1 2013: $2.75 million), a year-on-year increase of 16%

•        Medical Information Services sales increased to $1.86 million (H1 2013: $0.77 million), a year-on-year increase of 141% 

•        Direct Services sales increased to $150,000 (H1 2013: $108,000), a year-on-year increase of 39%

&middot         Gross profit increased by 32% to $3.05 million (H1 2013: $2.31 million)

&middot         Net cash from operating activities increased 21-fold to $1.30 million (H1 2013: $0.06million)

&middot         Adjusted EBITDA increased to $0.66 million, or 12.6% of sales, compared with $0.43 million, or 11.8% of sales, for the same period of the previous year

&middot         Adjusted pre-tax profit* increased to $0.49 million, or 9.4% of sales (H1 2013: $0.31 million or 8.4% of sales)

&middot         Cash and cash equivalents at 30 June 2014 were $0.52 million (31 December 2013: $0.29 million 30 June 2013: $0.09 million)

* Adjusted pre-tax profit means net of one-time IPO related cost of $0.53 million, which is included in the other nonrecurring general and administrative line of the financial statements

Operational Highlights:

&middot         Increased activity in all segments with greater volume of business being generated from some of the Company’s largest customers

&middot         Processed approximately 3.2 million screening services on over 1 million people that were provided to over 21,000 end users

&middot         Medical Information Services division launched new product offerings, such as clinical testing, and gained many new clients

&middot         Commenced building the Direct Sales Division, including hiring and training five sales people 

&middot         Opened a new office in London, U.K., and began establishing an International Business segment

Post-period end developments:

&middot         Raised gross proceeds of approximately $15 million through an initial public offering (“IPO”) on AIM in July 2014

&middot         Strong cash balance of approximately $12 million to fund future growth

&middot         Numerous sales contract won, including the largest direct sales contract to date

Robert Vale, CEO of ClearStar, commented: “We are delighted with our performance in the first half of 2014. We achieved strong organic revenue growth and opened a London office to focus on our international expansion. Looking ahead, we have entered the second half of the year with good visibility of revenues as the growth momentum seen in the first half of the year continues. Our focus is on maintaining our strong organic growth in all divisions and building our brand globally. As a result, the Board feels confident of delivering significant growth across all divisions for full year 2014.”

 

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