DICOM Group plc Business Update

DICOM Group plc (“DICOM”), a leading provider of Intelligent Capture & Exchange solutions, submits the following update on its business activities.

Current trading

DICOM expects its results for the six months ended 31 December 2007 to be in line with expectations. The Company has achieved its stated target of double digit revenue growth in constant currencies in its software business with a higher than expected contribution from software services offsetting lower growth in software licenses in the second quarter. The results will be announced on 18 February 2008.

Strategic review

On 5 November 2007, Reynolds Bish joined DICOM as CEO. Since his arrival, Mr. Bish has conducted a thorough review of the strategy, structure and branding at the company. Following this review it is clear that certain additional measures are now needed to accelerate progress with DICOM’s stated strategy of focusing on the software license and services portion of its business.

As a result of Mr. Bish’s analysis, DICOM’s organizational structure will be reorganized to better align and focus its resources. In the past, most line and staff functions were decentralized and widely distributed throughout the world, with both regional and country managers acting as general managers and being responsible for all of these functions and for revenue generation. With this reorganization, all line and staff responsibilities will be consolidated into vertically aligned, worldwide functions under global managers reporting to Mr. Bish. The essential purpose is to execute in a more consistent and cost effective manner and to focus management efforts more clearly on revenue generation activities.

In addition, DICOM’s sales function will be reorganized to better align and focus its resources. In the past, the sales function was decentralized and widely distributed throughout the world, with regional and country managers being responsible for selling all of the company’s products. With this reorganization, the sales function will be separated into three groups better aligned with DICOM’s products, markets and customers, namely: (1) software and solutions, (2) OEM software, including the market leading embedded VRS technology, and (3) European hardware distribution business. To further optimize this structure and improve sales productivity over time, the company has initiated a search for an Executive Vice President of Worldwide Field Operations to manage the sales function on a global basis, who will be based in Irvine, California and report to Mr. Bish.

As part of these changes, Urs Niederberger, DICOM’s Chief Operating Officer and an Executive Director, will leave the company as of 15 February 2008 and stand down from the Board of Directors immediately. The Board extends its thanks to Mr. Niederberger for his valuable contributions over the past ten years and wishes him well in his future endeavours.

Brad Weller has been appointed as General Counsel, and Company Secretary with immediate effect, replacing Stefan Gaiser, who remains the CFO and an Executive Director of the Company. Mr. Weller has had a very successful career both working as an attorney at a law firm and as an in-house attorney at a number of publicly-held technology companies, including Captiva, where he worked for Mr. Bish as General Counsel.

Also as a result of this review, the Board is proposing to change the name of the company to “Kofax plc”. There has been confusion both internally and externally over the various brands used by the company in the past, many of which have arisen through acquisition. Among all DICOM brands and products, Kofax clearly emerges as the brand with the highest awareness among stakeholders on a worldwide basis, having been recognised as the leading capture software for the past twenty years. Furthermore, the respected products and innovations that have emerged from Kofax most closely define the direction in which the company is now heading.

As a consequence of the corporate rebranding and restructuring, DICOM will make approximately 50 redundancies, close certain facilities and record an exceptional charge of GBP 3.5 to GBP 3.8 million in the second half of financial year 2008. This is expected to result in significant annual cost savings and allow the Board to increase investment in the company’s software and solutions business.

A Notice of Meeting will be sent to shareholders to convene an Extraordinary General Meeting at 11.00 am, 18 February 2008 at the offices of Landsbanki to seek shareholder approval for the proposed name change. If shareholders approve the new name, DICOM’s ticker symbol on the London Stock Exchange is expected to change from ‘DCM’ to ‘KFX’ with effect from 19 February 2008. The ISIN number for the company’s shares would remain unchanged.