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21 April 2008

NETeller First Quater Trading Update

First quarter 2008 shows solid performance continuing.

Friday, 18 April 2008 - NETELLER Plc (LSE: NLR), the independent global online
payments business, is pleased to provide a trading update in respect of its
performance during the first quarter to 31 March 2008.


- Renewed focus on merchant and consumer customers drives contract wins for
NETELLER e-wallet and NETBANX payments gateway business.

- Continued investment in improving product offering in core European and Asia
Pacific markets.

- European revenue (including NETBANX) was $11.3 million, an increase of 9%
from Q4 2007; Asia Pacific (including 1-PAY Direct) grew 20% to $3.6 million
over the same period.

- Active e-wallet users (ex North America) totalled 101,301 in Q1 2008, up 1%
from Q4 2007.

- E-wallet revenue per active e-wallet user was $113 in Q1 2008, up 7% from
$106 in Q4 2007.

- Average daily sign ups and average daily receipts in Q1 2008 showed growth of
6% and 11% respectively from Q4 2007.

- Strong cost control continues in Q1 2008, with gross margin of 62% (Q4
2007: 54%) and operating income of $2.4 million (Q4 2007: $0.6 million loss).

- Solid balance sheet at 31 March 2008 with $55.2 million cash and cash

Ron Martin, President & CEO, commented "The business has continued to deliver a
good performance in the first quarter. We are beginning to see tangible sales
progress in the adoption of our Merchant Solution Suite amongst both gaming and
non-gaming customers and prospects. Growth in our key European and Asia Pacific
markets remains encouraging and as we introduce new payment solutions and
targeted marketing programmes, we hope to see this momentum continue. The Board
looks forward to continued progress and remains confident about prospects for
the business."

The Company's Annual General Meeting will be held in the Isle of Man on Tuesday
13 May 2008.


Andrew Gilchrist + 44 (0) 1624 698 713

VP Communications, NETELLER Plc


Citigate Dewe Rogerson + 44 (0) 207 638 9571

Sarah Gestetner / Seb Hoyle / George Cazenove

Daniel Stewart & Co Plc + 44 (0) 207 776 6550

Paul Shackleton

Key performance indicators

The Group saw continuing improvement in its principal KPIs during the first
quarter of 2008, with active e-wallet users growing by 2% compared to the same
quarter in 2007 (excluding North American active e-wallet users), and also
growth of 1% quarter on quarter. Average daily receipts from e-wallet users
were approximately $365,000, an increase of 11% from the $330,000 reported in Q4
2007 and an increase of 22% on a like-for-like basis for Q1 2007. Total
receipts from e-wallet users during Q1 2008 totalled $33.2 million compared to
$30.3 million in Q4 2007.

The table below sets out the Group's active e-wallet users by region, excluding
those from North America:

Active e-wallet users Q1 2008 Q1 2007 % change Q1 Q4 2007 % change Q1
2008 vs Q1 2008 vs Q4
2007 2007

Europe 81,552 79,617 2% 77,937 5%
Asia Pacific 14,984 15,330 -2% 17,252 -13%
Rest of World 4,765 4,633 3% 4,795 -1%
Total 101,301 99,580 2% 99,984 1%

Total signed up 1,097,456 734,100 49% 997,219 10%
e-wallet users

In line with the Group's strategy to bring additional scale to the e-wallet, the
Group expects to see continuing growth of the active e-wallet user base and
e-wallet revenue per active e-wallet user in 2008. The table below shows by
region the Group's e-wallet revenue per active e-wallet user based on the
average quarterly fee revenue per user for the relevant quarters in 2008 and

E-wallet revenue Q1 2008 Q1 2007 % change Q1 Q4 2007 % change Q1
per active e-wallet 2008 vs Q1 2008 vs Q4
user ($) 2007 2007

Europe 117 118 -1% 111 5%
Asia Pacific 102 105 -3% 88 16%
Rest of World 81 130 -37% 92 -11%
Total 113 117 -3% 106 7%

To improve the usefulness of this KPI, revenue from the Group's Asian Pacific
gateway business, 1-PAY Direct, has been stripped out of the fee revenue in
calculating the e-wallet revenue per active e-wallet user for Q1 2008 and prior
period comparatives.

Average daily sign ups improved quarter on quarter by 6%, with 1,101 average
daily sign ups in Q1 2008 (excluding North America). This included growth of
10% from Europe in Q1 2008 compared to Q4 2007. Total average daily sign ups in
Q1 2008 (including North American sign ups) were 1,122 compared to 1,076 in Q4
2007, an increase of 4%. The table below shows the Group's sign ups by region
(excluding North America):

Average daily sign ups Q1 2008 Q1 2007 % change Q1 Q4 2007 % change Q1
2008 vs Q1 2008 vs Q4
2007 2007

Europe 819 867 -6% 745 10%
Asia Pacific 176 158 11% 197 -10%
Rest of World 106 103 3% 98 8%
Total 1,101 1,128 -2% 1,040 6%

The number of consumers who have e-wallets totalled 4,047,010 at the end of Q1
2008, including registered e-wallet users from North America.

Financial highlights


Revenue for the first quarter 2008 of $17.0 million represented a decrease of 7%
from $18.3 million for Q1 2007 (excluding the $14.4 million in revenue from
North American operations in that quarter) primarily due to the anticipated
decrease in interest revenue earned. Compared to Q4 2007, revenue grew by 5% in
Q1 2008.

E-wallet revenue, which comprises merchant and consumer fees generated from the
use of the e-wallet, excluding fees from the Group's NETBANX and 1-PAY Direct
gateway businesses, totalled $11.4 million in Q1 2008, an increase of 8% from Q4
2007. The Group has separately disclosed revenue from its 1-PAY Direct business
as this revenue is not directly related to usage of the Group's e-wallet, as
with NETBANX's revenue.

Revenue Q1 2008 Q1 2007 % change Q1 Q4 2007 % change Q1
($ millions) 2008 vs Q1 2008 vs Q4
2007 2007

Europe (ex NETBANX) 9.5 9.4 1% 8.6 10%
Asia Pacific (ex 1-PAY Direct) 1.5 1.6 -6% 1.5 1%
Rest of World 0.4 0.6 -35% 0.4 -12%
Total e-wallet revenue 11.4 11.6 -2% 10.5 8%
NETBANX 1.8 1.5 19% 1.7 5%
1-PAY Direct 2.1 0.9 138% 1.5 39%
Total fee revenue 15.3 14.0 9% 13.8 11%
Interest 1.7 4.3 -61% 2.4 -30%
Total 17.0 18.3 -7% 16.2 5%
North America (1) 0.0 14.4 nm 0.0 nm
Total 17.0 32.7 -48% 16.2 5%

(1) Some residual revenue was earned from North American operations during
Q1 2007 prior to the Group's withdrawal from the US and subsequently Canada;

nm: not meaningful

Interest revenue continues to decrease through both the impact of lower balances
held by the Group as a result of the return of funds to US customers under the
Distribution Plan and also the reduction in interest rates particularly for
funds held in US dollars.

Gross margin

Gross margin for Q1 2008 was 62.2% compared to 51.0% in Q1 2007 and represents
an improvement on the figure of 53.9% reported for Q4 2007.

Customer support costs continued to represent the largest proportion of direct
costs at 15.2% of revenue, compared to 17.4% in Q4 2007. Website maintenance
costs are down from 11.1% in Q4 2007 to 5.6% of revenues in Q1 2008 due to
significant reductions in server hosting costs relating to termination of a long
term contract in late 2007. Deposit and withdrawal fees were 16.7% of revenue
compared to 16.4% in Q4 2007.

Operating expenses

The Group achieved income from operations of $2.4 million in Q1 2008. General
and administrative expenses decreased to $8.2 million from $9.3 million in Q4
2007. This favourable variance was expected with decreased office, corporate,
advertising and professional fees in Q1 2008.

Cash position of the Group

The total amount of cash available to the Group totalled $55.2 million at 31
March 2008. The Group made the final scheduled payment of $38.25 million to the
US authorities on 16 January 2008. In relation to the Distribution Plan, the
Group had repaid $81 million to US customers out of a possible total of $94
million. The balance owing remains in trust.

As previously announced on 18 March 2008, the Group currently anticipates that
the disposal of the Group's principal Calgary property will be completed and
funds received by 30 April 2008. The total consideration receivable remains
unchanged at CAD 33.5 million.

Operational highlights

The Group announced earlier this year that 2008 would see important initiatives
to support its strategic goal of providing bold payment solutions for online
communities. During the first quarter, the Group's revitalised consumer
offering at, the NETBANX payments gateway and the NETELLER
Payment Network were relaunched with refreshed branding, aligning the Group's
consumer offering of a suite of lifestyle financial services for the online
generation more closely with its target demographic.

The first quarter also saw major product enhancements for merchants in line with
the Group's commitment to improve its merchant value proposition, including:

- Beta first release of Group's new integrated e-commerce payment suite
that combines the Group's NETBANX gateway and NETELLER e-wallet into a single
product offering for merchants.

- Significant enhancements to the NETBANX payments gateway for merchants
targeting European consumers, including local language, payment and foreign
exchange/currency enhancements.

- Delivery of the first release of a merchant co-branding program,
featuring co-branded merchant landing pages, to drive member acquisition and
funding conversions.

- Pilot of the Group's new payments gateway merchant application,
NETCENTRE, with significantly enhanced reporting and payment management

- Brand updates to the NETBANX brand and NETELLER e-wallet Merchant
Application to drive cross-selling of products to merchants.

The Group also invested in improving its consumer offering through continuing
product enhancements for its e-wallet users. These included:

- New European payment types for the NETELLER e-wallet to drive instant
payment and member conversions in this key geographic region.

- Revised consumer e-wallet pricing to increase e-money deposit volume
and drive adoption of prepaid cards for withdrawals.

- Enhancements to consumer dynamic limit management to increase e-money
deposit velocity.

- Account upgrade process improvements to drive more rapid NETELLER
e-wallet member feature and funding limit entitlement increases.

- Improvements to the prepaid card making funding faster for NETELLER
e-wallet members.

- Launch of Affiliate Program to drive increased new member acquisition.

- Revised consumer website with ability to tailor consumer content for
forty countries.

During the quarter a number of new gaming and non-gaming merchants have signed
contracts with the Group for the e-wallet and gateway payment processing
services. In aggregate the new merchants are expected to deliver
tens-of-millions of incremental transactions to the business.

The Group also announced in March 2008 the establishment of its 50:50 joint
venture, Centricom Europe Limited, to distribute the POLi service in Europe.
Under the joint venture, the Group also announced the launch of the POLi payment
service for the UK market, distributed through NETELLER's payment processing
arm, NETBANX. In August 2007, the NETELLER Group announced it had taken a 25%
strategic stake in Australian POLi operator, Centricom Pty Ltd. The European
joint venture is a 50/50 joint venture between both parties.

Trading outlook

The Board is pleased with the progress made during the first quarter of 2008 and
remains confident about prospects for the business. The strategic focus of the
Group towards its member and merchant customers and the introduction of the
e-Commerce Payment Suite are being evidenced by new contract wins in both the
NETELLER e-wallet and the NETBANX gateway business and continuing improvements
in the Group's key performance indicators, building on the strength of the first
quarter performance.

The Board continues to investigate the most appropriate use of the Group's cash
resources including organic investments such as the NewTeller project,
acquisitions and alliances, as well as its commitment to the introduction of a
progressive dividend policy at or before the release of the Group's 2008 full
year results.

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