Nasstar Announcements

Nasstar PLC
28 April 2008
Interim results for the six months ended 31 March 2008
Nasstar plc ("Nasstar" or "the Group"), which provides computing over the
internet, is pleased to announce its results for the six months ended 31 March
2008.

Highlights for the period

? Turnover increased 100% to £1m (2007: £490k)

? EBITDA profit of £100k (2007: EBITDA loss of £109k)

? Operating loss narrowed to £35k (2007: loss £199k)

? Increase in Hosted Exchange subscribers to 7,000 (2007: 3,492)

? Sales of Hosted Desktop showing promise with contract wins
during the period including Stelios'
easyGroup and Pinnacle Staffing Group plc

? Very encouraging sales pipeline for Hosted Desktop

? New web site and PR campaign launched in March, expected to
further strengthen the existing sales pipeline

? Post balance sheet sale of non-core web hosting contracts for
£120k cash, further streamlining operations

Chairman's Statement

Results
I am pleased to report the results for the Group for the six months ended 31
March 2008. The growth in turnover and the swing to EBITDA profitability during
the period show the effect of Hosted Desktop sales coming through. As stated in
our final results last year we maintain that Hosted Desktop is the key to
driving future growth and profitability.

The market
Nasstar's Hosted Desktop service delivers desktop computing over the internet, a
delivery model known as Software as a Service (SaaS). SaaS provides an
alternative to traditional on-premise software which is sold as a boxed product
and installed and run on 'local' computers. The SaaS market is set to continue
to grow with research by Gartner predicting that the worldwide market for SaaS
will more than double from US$5bn in 2007 to US$11bn by 2011.

Outlook

The Board believes that the market for SaaS will continue to grow and that
Nasstar is increasingly being recognised as an influential force in the UK
market. The sales pipeline is very encouraging and gives the Board confidence in
the Group's growth potential for the second half of the year and beyond.

Lord Daresbury
Chairman
28 April 2008

About Nasstar plc
Nasstar plc, an AIM-quoted company, makes computing a simple internet
subscription service, enabling subscribers of its Hosted Desktop service to do
all of their computing in the internet cloud rather than on a local computer.
Nasstar's Hosted Desktop provides subscribers with access to their desktop,
files, applications and email over the internet, providing a real alternative to
traditional on-premise computing.
The company vision is that everyday computing is becoming a utility in the
workplace - just like mobile phones - and should therefore be a simple
subscription service. Nasstar's vision is to use the internet to deliver
everyday computing, removing the need for traditional on-premise IT.

Nasstar is fast establishing itself as a force for change within the IT
industry, and customers who have already adopted this service approach include
Stelios' easyGroup.
Nasstar was founded in 1998 by Charles Black. Nasstar plc was admitted to
trading on the London Stock Exchange Alternative Investment Market in December
2005 (AIM: NASA).

For further information please visit www.nasstar.com and for investor relations
content please visit www.nasstar.com/ir
Nasstar plc
Consolidated Income Statement

for the six months ended 31 March 2008

Notes Six months Six months Year
to to to
31 Mar 2008 31 Mar 2007 30 Sep 2007
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Turnover 1,010 490 1,193
Operating Expenses before (899) (572) (1,260)
Depreciation and Amortisation
Depreciation (135) (90) (212)

Operating Expenses (1,034) (662) (1,472)
Share-based payments (11) (27) (69)
EBITDA 100 (109) (136)
Operating Loss _______ _______ _______

(35) (199) (348)
Finance costs (82) (44) (128)
_______ _______ _______
Loss before Taxation (117) (243) (476)

Income tax expense - 45 6
________ ________ ________

Loss for the period attributable to (117) (198) (470)
equity shareholders _______ _______ _______

Loss per Share 3 (0.81)p (1.49)p (3.39)p
Basic and diluted _______ _______ _______

Nasstar plc

Consolidated Balance Sheet

as at 31 March 2008

Notes 31 Mar 2008 31 Mar 2007 30 Sep 2007
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Non-current Assets
Intangible assets 844 718 844
Plant and equipment 2 531 332 292
_______ _______ _______
1,375 1,050 1,136
_______ _______ _______
Current Assets
Trade and other receivables 393 729 489
Cash and cash equivalents 4 89 58
_______ _______ _______
397 818 547

Current Liabilities 2 (1,096) (887) (951)
Trade and other payables
_______ _______ _______
Net Current Liabilities (699) (69) (404)
_______ _______ _______
Total Assets less Current 676 981 732
Liabilities

Non-current liabilities 2 (133) (102) (84)
_______ _______ _______
Net Assets 543 879 648
_______ _______ _______
EQUITY
Called Up Share Capital 145 145 145
Share Premium Account 1,031 1,031 1,031
Merger Reserve 662 662 662
Retained earnings (1,295) (959) (1,190)
_______ _______ _______
TOTAL EQUITY 543 879 648
_______ _______ _______

Nasstar plc

Consolidated Cash Flow Statement

for the six months ended 31 March 2008

Six months to Six months to Year to
31 Mar 2008 31 Mar 2007 30 Sep 2007
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Cash flow from operating activities
Loss from operations (35) (199) (348)

Adjusted for:
Depreciation of tangible assets 135 90 212
Share-based payments 11 27 69
Decrease/(increase) in trade and other 96 (269) (75)
receivables
Increase in trade payables 85 289 209
Finance costs (82) (44) (128)

Tax paid - - (25)
Net cash from operating activities _______ _______ _______

210 (106) (86)
_______ _______ _______

Cash flows from investing activities
Proceeds from the disposal of plant - - 13
and equipment
Purchase of property, plant and (374) (146) (156)
equipment
Purchase of subsidiary undertaking - (278) (778)
Net cash outflow from investing _______ _______ _______
activities
(374) (424) (921)
_______ _______ _______

Net cash outflow before management of (164) (530) (1,007)
liquid resources and financing

Financing activities
Issue of ordinary share capital - 500 1,000
New finance leases 176 130 90
Capital element of hire purchase (77) (59) (123)
contracts & finance leases _______ _______ _______
Net cash inflow from management of
liquid resources and financing 99 571 967
_______ _______ _______

Net (decrease)/increase in cash & cash (65) 41 (40)
equivalents

Cash & cash equivalents at beginning 8 48 48
of period _______ _______ _______
Cash & cash equivalents at end of (57) 89 8
period _______ _______ _______

Nasstar plc

Statement of Changes in Equity

for the six months ended 31 March 2008

Share Share Merger Profit and
Capital Premium Reserve Loss Account
£'000 £'000 £'000 £'000

At 1 October 2007 145 1,031 662 (1,189)

Loss for the period - - - (117)
Equity-settled share-based - - - 11
payments
At 31 March 2008 _______ _______ _______ _______
145 1,031 662 (1,295)
_______ _______ _______ _______
Notes to the Interim Report
1. Accounting policies
Basis of preparation

The interim financial information for the six months ended 31 March 2008 has
been prepared on an historical cost basis and in accordance with the accounting
policies that will apply for the year ended 30 September 2008, which will
follow the International Financial Reporting Standards (IFRS) and the
interpretations as endorsed by the European Union.

The comparative figures included in this report for the six months ended 31
March 2007 and the full year ended 30 September 2007 are restated for IFRS and
are unaudited.

IFRS 1 permits companies adopting IFRS for the first time to take certain
exemptions from the full requirements of IFRS in the transition period.
Accordingly business combinations prior to the date of transition to IFRS have
not been restated to comply with IFRS 3 'Business Combinations'. Changes
resulting from the adoption of IFRS 2 / FRS 20 had already been recognised in
the accounts for the year ended 30 September 2007.
The comparatives for full year ended 30 September 2007 are based on the latest
published audited accounts, but are subject to unaudited restatement to IFRS as
endorsed for use in the European Union. Accordingly they are not the company's
full statutory accounts for the year. A copy of the statutory accounts for that
year was prepared in accordance with UK GAAP and has been delivered to the
Register of Companies. The auditors' report on those accounts was unqualified,
did not include any references to matters to which the auditors drew attention
by way of emphasis without qualifying their report; and did not contain a
statement under section 237 (2) or (3) of the Companies Act 1985. As permitted,
the Company has chosen not to adopt IAS34 "Interim Financial Reporting".Except
as noted above, the following accounting policies have been applied consistently
in the preparation of these accounts:

Basis of consolidation

The Group financial statements consolidate the financial statements of the
Company and its subsidiary undertakings and exclude all Intra-Group transactions
and balances.

The results of subsidiary undertakings acquired are included from the date of
acquisition using the acquisition method of accounting. The results of
subsidiary undertakings disposed of are included up to the date of disposal, and
the profit or loss on disposal is calculated based on net proceeds receivable
and the net assets at the date of disposal, including any goodwill.
Revenue

Revenue represents amounts receivable for services net of VAT and trade
discounts. Revenue from service contracts is accrued evenly over the period of
the contract except that set-up revenues are recognised over the length of the
set-up period on a percentage to completion basis..

Research and development

Research costs are expensed as incurred. Development expenditure on an
individual project is recognised as an intangible asset when the Group can
demonstrate the technical feasibility of completing the intangible asset so that
it will be available for use or sale, its intention to complete and its ability
to use or sell the asset, how the asset will generate future economic benefits,
the availability of resources to complete the asset and the ability to measure
reliably the expenditure during development.

Notes to the Interim Report (continued)
Goodwill

The directors undertake an impairment review of goodwill at the end of each
annual reporting period.

Deferred consideration

The terms of an acquisition may provide that part of the total value of the
total of the purchase consideration, which may be payable at a future date,
depends on uncertain future events such as the future performance of the
acquired company. Where it is not possible to estimate amounts payable with any
degree of certainty, the amounts recognised in the financial statements are
those are reasonably expected to be paid as at the balance sheet date.
Plant and equipment

Tangible fixed assets are stated at cost less depreciation. Depreciation is
provided at rates calculated to write off the cost less estimated residual value
of each asset over its expected useful life, as follows:
Computer equipment & software development over three years on straight line basis
Fixtures & fittings 25% on reducing balance basis
Office equipment 25% on reducing balance basis

Leasing

Rentals payable under operating leases are charged against income on a straight
line basis over the lease term
Deferred taxation

Deferred tax is provided in full in respect of taxation deferred by timing
differences between the treatment of certain items for taxation and accounting
purposes. Recognition of the deferred tax asset is limited to the extent that
the company anticipates making sufficient taxable profits in the future to
absorb the reversal of the underlying timing differences. The deferred tax
balance has not been discounted.

Share-based payments

The group operates executive and employee share schemes. For all grants of share
options, the fair value as at the date of grant is calculated using an option
pricing model and the corresponding expense is recognised over the vesting
period. The expense is recognised as a staff cost and the associated credit
entry is made against equity.
Pension costs

The group operates a defined contribution pensions scheme on behalf of its
employees, the costs of which are charged to the income statement on an accruals
basis.
Financial instruments

Financial instruments are classified and accounted for, according to the
substance of the contractual arrangement, as financial assets, financial
liabilities or equity instruments. An equity instrument is any contract that
evidences a residual interest in the assets of the company after deducting all
of its liabilities.

Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and in hand. Bank overdrafts are
included within current liabilities unless there is a right of offset with cash
balances.

Notes to the Interim Report (continued)

2. First time adoption of IFRS

The Group reported under UK GAAP in its previously published financial
statements for the year ended 30 September 2008. The tables below reconcile
between the loss and net assets as reported previously under GAAP and those
reported under IFRS for the periods ended 30 September 2007 and 31 March 2007. A
reconciliation of net assets is also provided at 1 October 2006, being the
transition date to IFRS.

Reconciliation of loss under UK Note Six Months to 12 months to
GAAP and IFRS 31 Mar 2007 30 Sep 2007
£'000 £'000
Loss reported under UK GAAP (206) (476)
Adjustment to IFRS:
Lease rentals 64 135
Depreciation (38) (90)
Finance charge (18) (39)
_______ _______
(a) 8 6
_______ _______
Loss reported under IFRS (198) (470)
_______ _______
Reconciliation of net assets under Note As at As at As at
UK GAAP and IFRS 01 Oct 2006 31 Mar 2007 30 Sep 2007
£'000 £'000 £'000
Tangible fixed assets reported 140 137 119
under UK GAAP
Adjustment to IFRS:
Finance leases (a) 103 195 173
_______ _______ _______
Fixed assets reported under IFRS 243 332 292
_______ _______ _______
Current liabilities reported under (453) (809) (881)
UK GAAP
Adjustment to IFRS:
Finance leases (a) (55) (78) (70)
_______ _______ _______
Current liabilities reported under (508) (887) (951)
IFRS _______ _______ _______
Creditors falling due after more (20) (7) -
than one year under UK GAAP
Adjustment to IFRS:
Finance leases (a) (34) (95) (84)
_______ _______ _______
Creditors falling due after more (54) (102) (84)
than one year under IFRS _______ _______ _______

Equity reported under UK GAAP (a) 36 857 629
Adjustment to IFRS:
Net finance leases (a) 14 22 20
_______ _______ _______
50 879 649
_______ _______ _______

Explanation of reconciling item between UK GAAP and IFRS

(a) From 1 October 2006, the date of transition to IFRS, the Group's accounting
treatment of leases is required to comply with International Accounting Standard
17 (IAS 17). UK GAAP, under SSAP 21, provided greater flexibility over the
accounting treatment. Under IAS 17, whether a lease is a finance lease or an
operating lease depends on the substance of the transaction rather than the form
of the contract. The equipment leases entered into by the Group provide for the
payment to the lessor of a nominal sum at the end of the primary lease term in
exchange for title to the equipment that has been subject to the lease and the
Group does, in practice, make such payments. Under UK GAAP, the Group designated
such leases as operating leases. Under IFRS, the Group now designates such
leases as finance leases with the resultant change in accounting treatment.
3. Loss per share

The basic earnings per share is calculated by dividing the profit or loss for
the financial period attributable to equity holders by the weighted average
number of shares in issue.

Six months Six months Year
to to to
31 Mar 30 Sep
31 Mar 2007 2007
2008 Unaudited Unaudited
Unaudited
Weighted average number of shares 14,471,428 13,280,952 13,876,190
_______ _______ _______

Loss for the period (117) (198) (470)
_______ _______ _______

Basic and diluted loss per 1p ordinary (0.81)p (1.49)p (3.39)p
share _______ _______ _______
Due to the losses incurred, there is no dilution effect from the issued share
options.
Contact information

Nasstar plc
Charles Black, Chief Executive
020 7148 5000 - Telephone

W.H. Ireland Limited, Nominated Adviser to Nasstar plc
Nicola Rayner
0121 616 2101 - Telephone

END
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