Ahead of today's Annual General Meeting Xansa plc is publishing its first Interim Management Statement for the period from 1 May 2007 to 12 September 2007, as required by the UK Listing Authority's Disclosure and Transparency Rules.

Current trading update

The current financial year has started well, with revenue for the first quarter to 31 July 2007 up by 5% compared to the same period last year.

The first quarter has seen Xansa continue with its impressive 100% contract renewal rate. Three of our longest standing clients have renewed their contracts since the year end. In May, Tesco continued its 18 year relationship, by extending the contract to provide applications management for a further three years, with a contract value of £18 million. In July, Thames Water extended its 18 year relationship, with the renewal of the metered billing exceptions business process outsourcing contract. In August, BT, a client of 20 years and our foundation finance and accounting (F&A) outsourcing client in 2002, extended its F&A contract until 2014 in a deal worth £128 million over six years. These three renewals with such long-standing clients are a clear endorsement of our strategy of building long-term relationships and a testimony to the hard work and excellent delivery of the teams involved.

Financial position

There have been no significant changes in the financial position of the Group since 30 April 2007. At 31 July 2007, net debt stood at £30.7 million, as a result of normal working capital outflows.

Material events and transactions

On 30 July 2007, we announced that agreement had been reached on terms of a recommended acquisition of Xansa by Steria. Documents on the Scheme of Arrangement by Xansa plc, in connection with the recommended acquisition, were posted to shareholders on 25 August. The expected timetable of events around the recommended acquisition are summarised below:

• 18 September 2007: deadline for shareholders to lodge Forms of Proxy for both the Court meeting and for Xansa's Extraordinary General Meeting (EGM)
  
• 20 September 2007: first Court meeting to seek the approval of Xansa Shareholders for the Scheme of Arrangement
  
• 20 September 2007: an EGM will then be held to consider and, if thought fit, to pass a special resolution to implement the Scheme of Arrangement
  
• 12 October 2007: last date for dealing in Xansa shares
  
• 17 October 2007: effective date for transaction and cancellation of listing of Xansa shares