The Innovation Group (TiG) returned to cash generation in the fourth quarter after being "written off" as a company. The troubled provider of IT and business process outsourcing slightly beat analysts' expectations after a strenuous period in the year to 30 September.It produced operating cash flow of £2.8m in its final quarter after three quarters of falling cash flow. A year ago, the share price had crashed from more than 200p to less than 20p, after it revealed operating losses of more than £375m.Chief executive Hassan Sadiq admitted many customers and analysts had "written off" TiG.He said: "It was close to impossible to sign new business in that climate."Since then, the company had slashed costs to half their former levels, replaced its founder and former chief executive Rob Terry and refocused its operations on its core products.The adjusted profit before tax excludes £17m of amortisation and £5m of exceptional costs and nearly £6m written off investments as well as a £500,000 pay off for Terry.Another £700,000 was spent as staff headcount fell by 13%, with the axe falling particularly on TiG's systems integration staff as the workload was shifted more to TiG's partner, IBM.The amortisation of former acquisitions - after frenzied activity that included 25 acquisitions in 25 months - will continue for the next two years.Sadiq forecast flat growth on the BPO side of the business after the loss of one major contract cost TiG a "couple of quarters' growth", but increasing inquiry levels on insurance IT boded well.


  • Turnover down 42.5% to £58.5m from £100m
  • Loss before tax improved by 94% to (£24m) from (£391m)
  • Adjusted profit before tax down 67% to £3.3m from £10m.