Access enjoys profit on sale of legal search division

The group, which has its MS2M compliance division based in York, said it sold Solcara to media organisation Thomson Reuters. It plans to use the funds for working capital.

Access, which designs software to help businesses and organisations cut costs around procurement, bought Solcara for £750,000 in November 2008.

“I am delighted with the sale of Solcara as it is vindication of our strategy that significant value can be created in software businesses when they have clear market focus and strong technology,” said executive chairman Michael Jackson.

Access said it significantly reshaped Solcara to boost its value. At the time of Access’ acquisition, Solcara was also selling products into the communication and crisis management sectors.

Access said soon after buying Solcara, it decided to create a specialist search business concentrating on the legal market.

In line with this, Solcara’s two non-legal products, communication and crisis management, were transferred to other Access divisions to leave a pure legal specialist.

The AIM-listed group said since December 2009, Solcara has been growing strongly, building its customer base among law firms and in-house legal departments. It added the disposal of Solcara will have no impact on any other element of the group as it was a standalone subsidiary.

Solcara had sales of £750,000 and operating profits of about £20,000 in the year to the end of November 2010. It had net assets of about £150,000 at the end of May.

Access yesterday added most of the group traded in line with expectations in the six months to the end of May. The group said its Due North and AIMediaCommunications subsidiaries in particular had a successful first six months and continue to add new public sector clients and broaden their private sector client bases.

“The public sector is undoubtedly cutting budgets but we have seen very few contrac t cancellations,” said the group.

However, its the adjusted underlying earnings for the six months to the end of May will be no less than £430,000, significantly down on £704,000 a year earlier.

Access said this is before deducting the £202,000 costs of reorganising its Cobent subsidiary, which is yet to return to profit.

The group said it has made significant progress on turning around this business, including appointing Heath Williams as its chief executive.

Access added it has also restructured its capital base, which should allow it to pay dividends in the future. It ended the half-year with cash of £2.7m, which will grow with the Solcara proceeds.