Interim Management Statement

o2o, a leading provider of office supplies and solutions, announces that trading across the private sector has remained in line with management expectations for both the managed procurement and business critical services divisions in the period since 1 July 2011. However, as noted in the recent half yearly report, managed procurement sales volumes to the public sector continue to be adversely affected by the challenging economic backdrop and Government austerity measures.

As announced in August, o2o is the sole provider of office supplies and Closed Loop services under the largest ever government office supplies contract ('GOSC') which came into operation on 3 October. Some Government departments, particularly those we did not supply previously, had made arrangements prior to the transition to sole supply which has meant that initial sales volumes have been lower than we anticipated and, while they have since built steadily, remain short of the likely long term level. Margins are in line with expectations.

Departments including the Ministry of Defence have already transferred to GOSC with other departments and associated major customers scheduled to transfer in the next three months. However, it is unlikely that we will reach the expected level of GOSC sales in time to compensate fully for the previous public sector shortfalls by the year end.

As a consequence, we expect trading for the year ended 31 December 2011 to be below expectations: how much below will depend in large part on the rate at which new customers transfer to the GOSC contract over the rest of this year. However, whilst this is disappointing for 2011, we remain confident that the 2012 outlook is not affected by this timing issue.

Further Enquiries:

office2office plc
Simon Moate 01603 691 102

Cardew Group
Tim Robertson/ David Roach/ Georgina Hall 0207 930 0777

Panmure Gordon
Richard Gray/ Brett Jacobs 0207 614 8327