SDL plc (“SDL” or “the Group”), a leader in the emerging market for Global Information Management (GIM) solutions, is pleased to announce its unaudited preliminary results for the year ended 31 December 2007.

Highlights:

• Results ahead of market expectations
• Gross Margin up 4% points to 54%
• Strengthening of SDL’s leadership position in the GIM and Web Content Management market with the successful acquisition and integration of Tridion and Passolo
• Strong progress across all of the Group’s divisions:
  • SDL Tridion achieves triple digit revenue growth in the US
  • SDL Trados achieves 26% increase in new licence growth
• Significant new business wins:
  • TomTom, Gulf Bank, GLA (SDL Tridion)
  • Cisco, Deloitte, FIFA (SDL Trados)
  • Citrix, VMWare, Fujitsu – Siemens (SDL Enterprise Products)

• Acquisition of Idiom in February 2008 for £11.1m plus the assumption of debt of £2.5m:
  • Further strengthens SDL’s leadership position as a leading provider of GIM solutions
  • Adds a number of blue chip customers to SDL’s customer base
  • Combines SDL’s and Idiom’s technology solutions to provide better efficiencies of scale and shared intellectual property

Commenting on the preliminary results Mark Lancaster, Chairman and Chief Executive of SDL, said:

“I am delighted to report a continued strong performance in the year, reflecting the encouraging fundamentals of the Group. Our performance, which was ahead of market expectations, was driven by organic and acquisitive growth and a sustained demand for our technology and services solutions, despite the weakening dollar.

During the year we successfully completed the acquisition of Tridion, a Web Content Management company, and Passolo, which strengthened our software product offering. The recent acquisition of Idiom, one of the leading providers of “Software as a Service” translation management systems further strengthens the Group’s position and we believe enables SDL to further its strategic aims and establish itself as a global leader in GIM solutions.

At present we are continuing to see positive trading in almost all of our global markets across both the services and technology business units. Whilst globalisation is a long term trend for most businesses, we must acknowledge the current macro-economic uncertainty, and therefore our approach to managing the business in 2008 will be appropriately cautious. We are, however, fortunate that 70% of our revenue is derived from localisation services, and this revenue stream has proven in the past to be fairly robust and resistant to localised economic downturns. It is also important to note that Asia continues to be a vibrant market and that as companies anticipate challenges in their local economy they tend to look toward their global markets to fill revenue shortfalls that they are experiencing in their home markets. Creating and managing global content is SDL’s business, so even in the technology sector, global web content management remains a high priority for global business. We have seen an encouraging start to 2008 with a healthy services order book and a strong pipeline for technology.”

CHAIRMAN’S STATEMENT

Summary Performance

I am pleased to report that SDL recorded another impressive year in 2007, with both revenue and operating profits ahead of market expectations, despite the negative effect of the weak US dollar during the year. The prime drivers for the increase over the upgraded expectations for 2007 were the strong contributions from both Global Information Management (GIM) technology and SDL Tridion, which was acquired in May 2007. Revenues for 2007 were up 24% at £117.4 million (2006: £94.7 million) with approximately 8% of this revenue growth being organic and 16% contributed by the seven months of trading in SDL Tridion. Profit before tax and amortisation of intangible assets has increased by 39% to £17.0 million (2006: £12.2 million) while profit before taxation has increased by 36% to £12.7 million (2006: £9.4 million). Strong cash flow from operations of £16.0 million (2006: £9.9 million) has contributed to transforming net debt of £3.7 million as at 31 December 2006 to net cash of £15.5 million at 31 December 2007.

Technology

SDL Tridion (global Web Content Management business unit)
The acquisition of Tridion was well timed from an industry perspective and it has subsequently been integrated successfully into the SDL business. SDL Tridion achieved record results in terms of its revenue and profitability in 2007 with:

• triple digit revenue growth in the US in 2007
• over half of the licence revenues derived from new customers
• continued investment in expansion into US and Asia Pacific

SDL Tridion’s focus on enabling customers to deliver consistent and persuasive customer experiences in multiple languages across multiple Web sites and channels has led to significant global customer expansion. The substantial number of new customers in 2007 includes TomTom, Fortis ASR, NXP Semiconductors, State of Minnesota, Gulf Bank, Philippine Airlines, Greater London Authority and Disneyland Resort Paris. Many existing customers have also extended their SDL Tridion installations.

With these encouraging results, SDL Tridion has confirmed its position as one of the most profitable vendors in the public enterprise class Web Content Management (WCM) sector. SDL Tridion is now the fastest growing public enterprise class WCM vendor.

SDL Trados Technology and SDL Translation Management Systems
The SDL Enterprise Products business has experienced an increase in new name licence sales of 70% during 2007, adding customers such as Citrix, VMWare, Fujitsu-Siemens and Alcatel Lucent to its portfolio of leading global businesses. SDL Trados Technologies, a business unit which focuses on productivity software for the translation supply chain, has witnessed a double digit revenue increase and a 26% increase in new licence growth. Both business units attribute their strong demand to our customers’ increasing need to unify processes across the entire localisation supply chain, creating significant efficiencies and quicker time-to-market by utilising a common platform for localisation. In addition SDL Trados Technologies announced major new wins at blue chip companies including Cisco Systems, Deloitte, Drager Medical and FIFA.

Localisation Services

What has been most encouraging in 2007 is the scaling of the regional production centres, enabling them to increase their revenue throughput by upwards of 27%, whilst only increasing internal headcount by 10%. It is the unique mix of technology, infrastructure and process that allows us to scale to our larger customers’ needs. The localisation services side of the business, which now operates in over 30 countries, continues to benefit from the global reach, scale and leveraging of our technology. The structure and integrated nature of our regional offices allows considerable scaling and resource capacity which, when coupled with our Knowledge-based Translation solutions, have transformed the landscape for translation, speeding up time to market and reducing costs for our clients. We continue to increase the quantity of words that flow through our Knowledge-based Translation systems, a technology SDL considers is crucial for the future. One of the other important trends that we saw in the latter half of 2007 was a marked increase in business process outsourcing activity. The Group has recorded a significant increase in interest in its outsourcing capabilities, which has created a strong pipeline at the start of 2008.

Vision and Strategy for Global Information Management

In a world that is shrinking through an ever more effective and immediate communications infrastructure, trading effectively in global markets is no longer an option for large corporations, it is now a necessity. The starting point to enable a business to trade successfully in local markets is to communicate in the local language. The enormity and complexity of translating and maintaining millions of words of global content in multiple languages, in a world where communications must be instantaneous, is a major challenge for any business. Content is now delivered in multiple formats, through many channels from the web to physical hard copy. Press releases, marketing collateral, support knowledge databases, not to mention a company’s products and documentation, should all share common wording and messaging to fully support a company’s brand. However, the creation and management of multiple language content is currently not addressed by the content management technology available on the markets today.

SDL’s GIM technology accelerates the delivery of global content into local markets, ensures the operational consistency of branding and reduces the costs to translate content into multiple languages. In order to provide comprehensive global content management the complete supply chain of those involved in the creation and maintenance of global content must be included in the solution. SDL’s technology automates the delivery of global content in a controlled manner throughout this entire supply chain. It is estimated that over 90% of the Global 1000 companies rely on SDL Technology products, creating a solid foundation for future growth in a world that increasingly communicates across political and cultural boundaries

Idiom Acquisition
The acquisition of Idiom for £11million announced on 11 February 2008 consolidates SDL’s leading position in delivering GIM systems to the market. The main drivers behind the Idiom acquisition were:

• the enhancement of SDL’s GIM technology offering;
• the addition of a number of key blue chip customers to SDL’s customer base;
• the combination of SDL’s and Idiom’s technology solutions, which will provide improved efficiencies of scale and shared intellectual property;
• the provision of a smoother solution for managing the translation supply chain;
• the increase in SDL’s consultancy, sales and development expertise; and
• the strengthening of SDL’s position as a leading provider of GIM solutions

The integration of Idiom into SDL’s operation has many parallels to that of the Trados acquisition, one which has already delivered considerable long term benefits to SDL. During 2008 we expect Idiom to be break even in terms of operating profit. However, moving into 2009 we expect to see a significant contribution in terms of technology to the enlarged group.

Outlook

At present we are continuing to see positive trading in almost all of our global markets across both the services and technology business units. Whilst globalisation is a long term trend for most businesses, we must acknowledge the current macro-economic uncertainty, and therefore our approach to managing the business in 2008 will be appropriately cautious. We are, however, fortunate that 70% of our revenue is derived from localisation services, and this revenue stream has proven in the past to be fairly robust and resistant to localised economic downturns. It is also important to note that Asia continues to be a vibrant market and that as companies anticipate challenges in their local economy they tend to look toward their global markets to fill revenue shortfalls that they are experiencing in their home markets. Creating and managing global content is SDL’s business, so even in the technology sector, global web content management remains a high priority for global business. We have seen an encouraging start to 2008 with a healthy services order book and a strong pipeline for technology.

Mark Lancaster
Chairman and Chief Executive

For further information please contact:

SDL plc
Mark Lancaster, Chief Executive
Alastair Gordon, Finance Director
Tel: +44(0)1628 410 127

Financial Dynamics
Juliet Clarke/Edward Bridges/Haya Chelhot
Tel: +44(0)20 7831 3113