MessageLabs Group Reports Another Year Of Record Revenues And Appoints New Chairman

LONDON—27 October, 2004—MessageLabs Group, one of the United Kingdom’s leading privately held managed technology services companies, today reported another year of record revenue growth.

In the year ended 31 July, 2004, total revenues were £57 million ($102 million), an increase of 35% from £42 million ($67 million) for the year ended 31 July, 2003. At the same time, cash reserves exceeded £13 million ($23 million) and the Group had a customer base of almost 10,000 companies worldwide as well as more than 600 employees across eight countries.

The Group also announced the appointment of Duncan Lewis as its new Chairman. He will lead the Board and contribute to various strategic and operational activities. He will also be responsible for promoting the highest standards of corporate governance within the Group. Mr. Lewis brings a wealth of relevant experience to the Board spanning managed services, technology and telecommunications, and will be instrumental in the development and future success of the Group.

Mr. Lewis is senior advisor in Telecommunications, Media and Technology to The Carlyle Group, one of the world’s largest private equity firms with over $18 billion under management. He has also held senior executive positions with a number of leading companies in the Group’s chosen markets including Equant, Granada Media, GTS/Ebone and Cable & Wireless.

MessageLabs Group comprises two highly successful companies, Star and MessageLabs. Previously known as Star Technology Group, the Group re-branded in September to capitalise on the impact of MessageLabs’ global reach and brand awareness, positioning it to take advantage of additional growth opportunities.

MessageLabs is the global leader in email security and management services for businesses.* The company provides a range of email security and management services (including Anti-Virus, Anti-Spam, Image Control and Content Control) designed to protect, control and manage email at the Internet level before it reaches corporate networks and end users.

All MessageLabs services are delivered over a secure and resilient global infrastructure, are fully managed and require no additional hardware or software at the customer’s site. The services utilise predictive and responsive, as well as proprietary and third party, technologies.

Over the past fiscal year, MessageLabs has:

Added two new data centres in Sydney and Brisbane, Australia, and opened a new European office in Amsterdam.
Grown its global customer base by 64% from 5,200 to over 8,500 organisations, with new clients including Aegon, Britannia Airways, British American Tobacco, Cable and Wireless, Capita Group, Olympus Americas Inc.., the UK government, and Virgin Blue Airlines.
Doubled its channel programme to include more than 600 partners, which contribute more than 50% of total sales. New global alliance partners include IBM, Unisys, MCI and Computer Sciences Corporation.
Increased mail volume so that it today scans an average of 70 million emails each day to stop viruses, spam, unwanted images and other harmful content.
Intercepted over 570 million viruses, worms and Trojans on behalf of customers, including over 60 million copies of MyDoom.A, the world’s fastest spreading worm to date..

Star is a leading provider of managed technology services to mid-sized businesses and public sector organisations in the UK. Formerly known as Star Internet, the company was re-named in September 2004. Building on its origins as a business only ISP Star is now focused on the managed services market and offers a broad range of technology related services to its customers and prospects.

Star’s new offering is based around the integration of network connectivity, managed services and applications, and is designed specifically to enable mid-sized businesses to take advantage of a range of technologies normally considered the remit of larger organisations, due to the significant investment they require.

Over the past fiscal year, Star has:

Grown its customer base to more than 4,000 UK businesses and public sector organisations. Increased its partner program to include 20 resellers and 180 associates. Opened a new data centre in London and become the first company in Northern Europe to offer IBM’s On Demand technology as a managed service. Won the Telecommunications & IT industry’s “Customer Services Team of the Year’ at the National Customer Awards 2004.

Ben White, CEO of MessageLabs Group, said: “Our track record of growth is a phenomenal achievement and is testament to the hard work and dedication of our staff. The two Group companies share a fervent commitment to innovation and customer service, believing that technology plays a key role in helping companies be more competitive.

“Our rapid expansion, through both organic growth and acquisition, has made it essential that the Group brand represents each company within it in the most integrated and compelling way. The re-branding is therefore an important step in our evolution and means we can more effectively build on the MessageLabs success story.

“I look forward to further success in the years ahead, as more UK businesses benefit from Star’s comprehensive technology services and more organisations worldwide embrace the benefits of MessageLabs’ managed services to protect, secure and manage their email at the Internet level. I believe that the continued growth and achievements of both companies will contribute to an even brighter future for the Group.” About MessageLabs Group MessageLabs Group, formerly known as Star Technology Group, was founded in 2000 and is the parent company of two UK-based technology companies: MessageLabs, the leading provider of managed email security services to businesses worldwide, and Star, a provider of technology services to UK mid-sized companies and public sector organisations. With headquarters in Gloucester, United Kingdom, the company has offices in eight countries worldwide and employs over 600 people. Customers include the UK Government, The Bank of New York, Bertelsmann, CSC, Diageo, Orange and Random House for MessageLabs, and Group Four, Umbro, GWR, BSM, Misys, and Virgin Energy for Star. The information relating to MessageLabs’ services contained in this release is based on data generated internally by MessageLabs and has not been subject to an independent review by a third party.