foundersâ€™statement bvrp software becomes

To better aff irm our Spirit of Conquest and Passion for Innovation,BVRP Software changes its name and becomes Avanquest Software.

Headquarters1 bis, rue Collange

92593 Levallois-Perret Cedex - FranceTel. : +33 (0) 1 41 27 19 70 Fax : +33 (0) 1 41 27 19 70

www.avanquest.com

AVANQUEST SOFTWARE USA1333 W.120th Avenue, Suite 314Westminster, CO 80234 - USATel. : +1 (720) 330 1400 Fax : +1 (303) 450 1154

AVANQUEST PUBLISHING USA7031 Koll Center Parkway - Suite 150Pleasanton, CA 94566 - USATel. : +1 (925) 474 1700 Fax : +1 (925) 474 1800

Headquarters1 bis, rue Collange92593 Levallois-Perret Cedex - FranceTel. : +33 (0) 1 41 27 19 70 Fax : +33 (0) 1 41 27 19 70www.avanquest.com

Sckellstrasse 681667 MünchenTel. : +49 (89) 790 9790 Fax : +49 (89) 790 9791

22 fl, Hanwa B/D, 23-5, Youido-Dong,Yeongdeungpo-Gu, Seoul, Korea, 150-717Tel: +82 2 784 8139Fax: +82 2 780 5802

c/Perú, 6. Edificios Turin GolfBloque B Oficina4,2a Pl.28290 Las Matas MadridTel. : +34 91 630 70 23 Fax : +34 91 636 84 85

1 bis, rue Collange92593 Levallois-Perret Cedex Tel. : +33 (0) 1 56 76 58 00 Fax : +33 (0) 1 56 76 58 10

Room 1201, HuiTong Building,569# East JinLing RoadShanghai 200021, ChinaTel: +86 31 5382 3390Fax: +86 21 5382 3383

Formerly Kommunicate - MediaGoldSheridan House40-43 Jewry StreetWinchester, Hampshire, SO23 8RY Tel. : +44 (0) 1962 835000 Fax : +44 (0) 1962 835100

Formerly GuildSoftThe Software Centre East WayLee Mill Industrial Estate IvybridgeDevon - PL21 9GE Tel. : +44 (0) 1752 895100 Fax : +44 (0) 1752 894833

2004A N N U A L R E P O R T

Bruno VanrybChairman & CEO

Roger PolitisGroup General Manager

BVRP Software BecomesAvanquest Software

2/3Founders’Statement

The Spirit of Conquest

By achieving its all-time best performance in 2004 - the year of its 20th anniversary - the BVRP Group has

strikingly demonstrated that a fast-growing and profitable business can also be a model for sustainable

growth. The 2004 results provide real proof of our ability to combine persistent technological innovation with

the necessity of adapting to a continually changing environment.

To better affirm and accompany our path forward as well as our passion for innovation, BVRP

Software today changes its name and becomes Avanquest Software.

Our goal going forward is for Avanquest to become the symbol of our will to Advance and our thirst for

Entering new territories.

This spirit of conquest has always been at the center of our purpose and motivation - it has driven us first

to cover Europe and then to expand to the United States. It has also led us into opening branch offices in

Shanghai, China, and Seoul, Korea, as a prelude to our forthcoming arrival on the coasts of Japan!

This very same spirit has helped us become one of a select few world-leading companies in the highly

competitive fields of Communications and Mobility software. It drives us again today into further innovation

and investment to develop our presence and our offerings in the very promising Productivity and Utility

software market segments.

Avanquest Software is an international brand name, instantly recognizable worldwide. It strongly represents

our goal of establishing the Group’s presence in all territories from America to Asia, and in all sales

channels from OEM to the Internet.

With the unrelenting support of our Shareholders, our Clients and our Employees, we are extremely

confident that a new era of rapid and profitable growth is beginning for Avanquest Software. Our change

of identity is but a mirror of this belief, which drives all the Group Managers’ efforts.

We thank you for your confidence.

2 Contents

3 Founders’ Statement

4 Annual Results

6 Year 2004 Hightlights

8 Avanquest Software Group

10 Avanquest Software

11 Avanquest Publishing

14 Worldwide Organization

16 OEM Presence

18 Avanquest Online

20 Company Organization

21 Group Teammates

22 Sustainable Development

and Corporate Governance

26 The Company on the Stock Market

Contents

The remarkable financial results of 2004 – marking BVRP Software’s20th anniversary year – strongly demonstrated the Group’s havingachieved and exceeded all its turnover and profitability objectives.These results validated the strategy put in place three years earlier andalso enabled the Company to invest and implement a new organizationalstructure to pursue its ambitious growth strategy, with ever increasingperformance levels contributing to strong foundations for a new Groupdimension.For the first time in 2004, the BVRP Group presented its financial statements according to the IFRS standards. When measured accordingto this new accounting standard, which will be used by the Group in thecoming years, the BVRP Group performed as remarkably as it had under previous accounting standards from 1999-2002, showing an operatingprofit of €6.7M, or 11.8% of the turnover, and a net income multipliedby three to reach €5.3M, or 9.3%.

> Accelerated growth in Software turnover

The Group’s turnover (€57M) increased by 17.5% (9.4% on a like-for-like basis), thanks in particular to 26% growth in Software activity, theGroup’s core business. This growth in turnover was fueled by the ongoing

efforts in the area of R&D and marketing (increased by 10.6% and 15.3%,respectively), whereas G&A costs remained flat, a reflection of the verystrict cost-control policy applied by the BVRP Group. The confirmed success of the best-seller Mobile PhoneTools®, combinedwith steady growth in the historic line of communication software, enabled the OEM business, a strong margin contributor, to post thebest performance since its creation. This strong growth in OEM wasaccompanied by a continued growth and an ongoing product line expan-sion of the Avanquest publishing network, in both Europe and the UnitedStates, enabling retail and business channel activity to grow by 18%.

> Continuing rise in profitability

The BVRP Group again improved its operating profit in 2004, showingan increase of 12.4% in the second half, for the sixth consecutive semesterof improvement since 2001. All of the major country markets contributed to the increase in margins,with a spectacular rise in the contribution of the French companies. Forthe year as a whole, the operating income posted a 75% growth andgreatly exceeded the initial objectives set by the Group’s management. The financial result, which was little affected by the drop in the dollar as

a result of the hedging policy implemented during the year, is close tobreak-even and is greatly improved in comparison with the previous year(-€0.1M vs -€0.9M in 2003).The consolidated result after amortization of goodwill, grew 3.7 times overthe previous year to €3.8M or 6.6% of turnover. Leaving out amortiza-tion of goodwill, the net income is €5.7M, for a record rate of 9.9%. Itshould be noted, however, that the BVRP Group benefited from an overallreduced tax rate (18%), thanks in particular to accounting for previous taxlosses carried forward in France, generating a €1M savings.

> A reinforced financial structure for ambitiousobjectives

The Group’s financial structure improved further, with an increase of 52%in its stockholders’ equity and of 89% of its net cash. Cash availableamounted to €20M, unchanged in relation to the previous year’s close.These excellent results, coupled with conversion of all convertible bondsstill outstanding as of 31 December 2003, made it possible to financeinvestments for the year (for a total of €9.9M).

‹‹ In 2004, the year of

its 20th anniversary,

the BVRP Software group

posted the best

performance in history ››

TURNOVER BY COUNTRY IN 2004 TURNOVER BY ACTIVITY IN 2004

TURNOVER

in euros millions

Retail/Enterprises (57.6%)

OEM (21 %)

Service (13.8%)

Others (3.7%)

E-commerce (3.3%)

USA (45.6%)

Rest of the World (4.3%)

Rest of Europe (2.8%)

France (16.9%)

United Kingdom (24%)

NET INCOME

in euros millions

-4.9

5.4

2.4

1.0

3.8

NET OPERATING INCOME

in euros millions

99/00 2001*

1.4

2002 2003 2004

-1.2

0.4

1.8

5.7

OPERATING PROFIT

in euros millions

3.1

-0.8

1.6

3.9

6.9

99/00 2001* 2002 2003 200499/00 2001* 2002 2003 2004

NET CASH ASSETS OF FINANCIAL DEBTS

in euros millions

* 12 month proforma; 2000/2001 was a 17 month FY

3.4

-2.3 -3.1

6.5

12.4

99/00 2001* 2002 2003 2004

STOCKHOLDERS’ EQUITY AND LIABILITIES

in euros millions

99/00 2001* 2002 2003 200499/00 2001* 2002 2003 2004

15.6

10.8

16.2

23.9

36.1

32.8

43.2

37.6

48.5

57.0

The Group posted spectacular results and overachieved all its objectivesin 2004 with Operating results +€6.7M increasing +75%

and Net results +€5.3M skyrocketing +207% vs. previous year

Excellent Annual Results

4/5Fundamental data

Germany (6.4%)

Thierry BonnefoiChief Financial Officer

JANUARY

> Avanquest: BVRP Software reached anagreement with leading Japanese software publis-her P&A, thus expanding Avanquest, its SoftwarePublishing Network into Asia.

> BVRP: Mobile PhoneTools was selectedas one of the year’s best products at the 2004CES (Consumer Electronics Show) in Las Vegas.BVRP received the award with Motorola, whichlicenses Mobile PhoneTools for worldwide distri-bution with some of its handsets and accessories.

FEBRUARY

> BVRP: BVRP Software signed two globalagreements: one with Widcomm (now Broadcom),leader in Bluetooth connectivity solutions forPCs, PDAs and Mobile Phones; and anotherwith Enfora, a leader in wireless data devicesfor integrators and mobile application providers.BVRP’s popular Pocket PhoneTools and MobilePhoneTools products were included in all non-embedded Enfora products. At 3GSM World Congress, BVRP Software laun-ched Mobile PhoneTools® 3.0 and the completelynew Network Nomad®, universal connectivitysoftware for portable PCs.

> VCOM: Recovery Commander, currentlybundled with other VCOM products, becameavailable as a stand-alone product.

MARCH

> Avanquest: Avanquest brought CyberLink’sdigital media products to France, Spain, Germanyand United Kingdom, following their introductionto North America, Australia and Italy.

> MySoftware: Avanquest USA launchedDesign & Print to enable small businesses to easilycreate professional looking marketing materials.

APRIL

> Strategy: Avanquest became an interna-tional brand. BVRP Software announced therebranding of Avanquest subsidiaries in France,Germany, UK and US. The change was made to better reflectAvanquest’s tightly integrated global operationsand the success met by the Global SoftwarePublishing strategy of BVRP.

MAY

> Finance: The Group published its firstquarterly results. With consolidated turnover of€12.9M and up by 10.1%, and a doubling of itsoperating profit, the BVRP Software Group recor-ded an excellent first quarter 2004 - a strongincrease compared to the previous financial year.AGF Private Equity, a subsidiary of Allianz Group,took up to 4.5% stake in BVRP's capital.

> VCOM: VCOM announced the launch ofthree utility software products: PowerDesk Pro 6,a powerful new version of its award winning andindustry leading file management utility; SecurEraseensures data on a hard drive is truly erased andunrecoverable; and System Commander 8, thesafest and easiest way to add and manage newoperating systems, without any performancedegradation.

JUNE

> Corporate: BVRP celebrated 20 years ofinnovation since its founding in 1984 by BrunoVanryb and Roger Politis. From a mere two Frenchemployees at inception, BVRP has expanded toits current global presence, with more than 100million software packages sold in 26 languagesover the last 20 years.

> MySoftware: Avanquest USA launchedMyMailList Deluxe, a comprehensive solution forbusinesses to manage contacts and save moneyon postage.

JULY

> Strategy: BVRP Software turned its ambi-tions into reality on the Iberian peninsula. TheGroup continued the geographic expansion ofits Avanquest global publishing network, esta-blishing a subsidiary in Spain, Avanquest Ibérica,through OutSource SL integration.

AUGUST

> MySoftware: Avanquest USA launchedan enhanced version of MyLabels Premium andsigned a cross marketing agreement with Avery,the world’s leading manufacturer of labels andrelated supplies.

> VCOM: VCOM announced the availabilityof AutoSave 2, designed for users who do not cur-rently backup, or backup only occasionally; thisutility software provides an automatic, safe andcontinuous backup.

SEPTEMBER

> Finance: The Group published its half-year results for 2004. BVRP’s turnover (€27.4M)showed a double-digit growth, with the grossfigure up 26% and the pro-forma figure up 10%.Operating profit rose to €3.2M, or 11.8% of turnover, an increase of 165% over the first halfof 2003. This was BVRP Group’s fifth consecutivesemester of growth in both turnover and profit.

> VCOM: VCOM announced the launch ofPartition Commander 9, the most powerful partitioning utility available, reclaiming wasteddisk space, organizing files, adding new operatingsystems and in many cases speeding up driveaccess.

OCTOBER

> Finance: BVRP Software Group announ-ced encouraging signs for its third quarter tra-ding with consolidated turnover at the end ofJune 2004 of €41.0 M, a rise of more than 23%over the same period in 2003. On a like-for-likebasis, growth was 11.3% in the third quarter and10.5% for the year.

NOVEMBER

> BVRP: Hewlett-Packard selected BVRP'sFaxTools to equip selected HP All-in-One products standard for selected HP PSC 1200All-in-One series products destined for theGerman, Austrian, Belgian, Danish, Dutch andPolish markets. BVRP Software signed a strategic agreementwith Blueway, the French leader in distribution ofcellular phone accessories. BVRP Software andBlueway have joined forces to create a value-added offer intended for the general public.These solutions include a Bluetooth dongle oran infrared device and a customized version ofthe popular Mobile PhoneTools® software created by BVRP.Netgear, a worldwide provider of technologicallyadvanced, branded networking products, choseBVRP’s LAN Wizard to be integrated into all ofNetgear’s home and small business router pro-duct lines, and in this way to simplify the set-upand the configuration utility detects type, currentnetwork configuration and other pertinent infor-mation relating to a user’s Internet connection.

> Avanquest: Avanquest announced amajor expansion of its business relationship withACD Systems, one of the world's leading deve-lopers and makers of digital imaging software.Following on the long-running and successfulrelationship between the two companies in France,under the new agreement Avanquest will distributeACD Systems titles via Avanquest subsidiaries inGermany, Spain and the UK.

> MySoftware: Avanquest USA launchednew versions of top selling finance products,Bookkeeper and MyDeluxe Invoices & Estimates.

DECEMBER

> BVRP: BVRP Software and Optimus, aPortuguese mobile phone operator with 2G and3G Networks, and member of the Orange net-work, signed a Strategic Partnership for a spe-cial edition of BVRP’s Mobile PhoneTools®, ena-bling Optimus subscribers with UMTS PC cardsand phones to connect to the Internet and sendSMS from their PCs. BVRP started work in adding Symbian OS supportto Mobile PhoneTools, its best-seller with m-Network, Intuwave’s Smartphone IntegrationEngine. Symbian is the most popular Smartphoneplatform in the world, running over two-thirds ofthe world’s Smartphones.

> MySoftware: Avanquest launched a lineof 5 MySoftware products in UK retail.

> VCOM: VCOM announced that CopyCommander 9 is available and shipping. CopyCommander automatically transfers everything fromone hard drive to another.

1ST HALF-YEAR 2004

Ever increasing Performances have built strong Foundations for a new Group’s Dimension

2ND HALF-YEAR 2004

Early 2005: BVRP Software acquires

Silicon Valley’s V-Communications, the leading PC Utilities

Software Developer

2004 Performances

Year 2004 Highlights 6/7

Avanquest Publishing:An international software publishing organization; Publisher of innovativeworld class software in every market by providing partner developers withinstant access to all channels using local expertise.

Avanquest Software: Software Developer,

owns 3 powerful brands in 3 strategic software categories.

Company management decided at the end of 2004 to emphasize the newdevelopment opportunities created through BVRP’s strong emphasis on growth and profitabi-lity throughout the year, to further strengthen the group’s intellectual property and to boostsales development for their own high margin-contributing lines of software.

In 2005, three product divisions will manage the company’s software products, which include the BVRP Mobility and CommunicationsSoftware line, the MySoftware line (acquired in April 2004 through the Company’s acquisition of Elibrium), as well as the VCOM PCUtilities software line (through the acquisition of V-Communications in February 2005). Each product division will have its own R&Dteam and corresponds to the each of three market segments in which the company is expanding its product offerings:

All software will be marketed worldwide in all channels by BVRP’s Avanquest Software Publishing division,

which currently publishes best-selling software in all product categories from both BVRP and third-party developers.

A new dimension for the BVRP Group, now Avanquest Software

8/9Avanquest Software Organization

A unique organization: a worldwide network

With 20 years of experience developing and publishing software,Avanquest sells over 20 million copies of software per year. In theformation of Avanquest, BVRP has acquired leading softwarepublishing companies around the world, and has brought togethera unique team with powerful channel relationships within eachrespective territory. Today, covering well over 15,000 retail outletsworldwide, Avanquest supports every major distribution channel,maximizing sales across multiple channels and geographic regions.Avanquest has a presence in local markets registering over 90%of the world's total packaged software sales.

The Global Publishing Strategy

With publishing strength, experience and presence on all continents,Avanquest offers the company and partner developpers a single sourcefor all aspects of global sales and distribution, including packaging, promoting, selling and supporting their products in North America,Europe and Asia.

Today, Avanquest is the first software publishing network to offer:

> A global coverage, with a strong local presence in markets covering almost 90% of the world’s packaged software sales.> Strong marketing power through all channels (OEM, Corporate,Retail, e-commerce)>Technological know-how and R&D teams to adapt internallyand externally developed software to each market.

Synergies between the company’s own development efforts (AvanquestSoftware) and its third party publishing arm (Avanquest Publishing) pro-vide a key competitive advantage: all Avanquest software titles benefit fromestablished development, and global sales and marketing capabilities.

Partner advantages: The very high cost of launching new softwareon the global market prevents the majority of software publishers fromlaunching new products in a complete and thorough manner. By offering anetwork, created to globally market its own software, to other publishers,Avanquest Software enables software developers to sell their productsthroughout the world, under their own brand name, or under one the threebrand names owned by Avanquest Software (BVRP, MySoftware or VCOM).This network, which offers access to global distribution with highly experiencedand well-known local partners, also constitutes an asset for the AvanquestSoftware group in its search for innovative software that deserves to belaunched and marketed on a global scale.

>The Mobility Division

manages the Communication, Mobility and Wireless lines

of the BVRP Software brand;

>The Productivity Division

manages the MySoftware brand Productivity line, geared toward small

and medium-sized companies,

>The Utilities Division

manages the VCOM brand of PC Utilitysoftware and security suites acquired as

a result of a merger with V Communications.

Avanquest Software :a Software Developer


Mobility Division

VCOM began providing solutions for PC users in 1986 and has built a solid reputa-tion by providing affordable, high-quality products for both IS professionals in anEnterprise environment and end users who want the most from their PCs. Today VCOMis recognized as the leader in PC utilities with ground breaking products tomanage, protect, and maintain today's PCs. In February 2005, BVRP Softwareacquired VCOM, the leading Californian PC Utilities Software Developer with the viewof further developing the product range, channel and territory coverage.

VCOM's security products, such as SystemSuite, Fix-It Utilities, AutoSave, RecoveryCommander and SecurErase provide protection for users and their PCs, with Anti-Virus,Firewall, Anti-Spam, diagnostics, recovery, permanent drive erasure and much more.VCOM's line of true 'what you see is what you get' file management and web site deve-lopment products includes Web Easy Professional, PowerDesk Pro and Media Easy.When it comes to disk and operating system management utilities, VCOM provi-des the dominate solutions to run multiple OSes and partition hard drives quickly andsafely with System Commander, Partition Commander, and Copy Commander.

Rounding out the VCOM line is AutoSave for automatic, non-intrusive backups, andFinal Bid for automatic bidding to win more auctions while paying less! One thirdof VCOM’s sales are internet sales. 10% of VCOM’s sales are international, of whichmajor part is made in Japan. Avanquest France and Avanquest UK already sell VCOMsoftware’s that will be quickly published in all territories and trough all sales channelsof Avanquest network.

BVRP Software believes in the essential promise ofmobility - that people want access to information wherever they are and that, as a result, communication,computing and the Internet must become ubiquitous. Withan estimated 1.3 billion people worldwide now using mobilephones and some 650 million handsets - more than triple thenumber of PCs - sold during 2004, mobile phones are farand away the largest-selling electronic products in the world.BVRP has encouraged the trend toward mobile access toinformation, playing a prominent role since the birth of themobile Internet in creating communications managementsoftware, and has capitalized on the skyrocketing growth in mobile phone use. Now, with the recent launch of ourdedicated Mobility Software division, we are poised forrapidly accelerated growth in all segments of mobility.

BVRP's core strategy in Mobility and Communicationsis to reduce the staggering complexity in today’s compu-ting environment, in which PC makers, cellular operators,handset vendors, WiFi hotspot providers and numerousothers all contribute to the rapid technological advances hap-pening around us. Our software enables the continuingconvergence of PCs and mobile appliances and helps userscope with today’s ever-expanding variety of wireless net-works to simplify the digital experience.

BVRP’s flagship software title, Mobile PhoneTools, letsmobile devices talk to PCs, greatly expanding the capabilitiesof both. As the computing power of mobile devices increases,Mobile PhoneTools suite of capabilities will grow in lockstep,enhancing the mobile computing experience with data synchronization, file management, ringtone creation, mobileimage and video editing, and more.

BVRP has recently launched a strong consumer initiative in the rapidly growing mobile content market withMobileffects.com and Ringtone Media Studio. The onlinemobile content store and PC based mobile media toolscombine an extensive library of mobile content, includingthousands of ringtones, wallpapers, video clips and mobilegames with the tools to personalize content and share it withfriends.

Our newest product, BVRPConnection Manager Professional,automatically connects mobile workers to the best availa-ble network: Ethernet, Wifi, cellular, Bluetooth or dial-up,wherever they may be. Corporate IT managers and ser-vice providers can also distribute preconfigured profiles tomake connecting simple.

BVRP’s Mobility products are distributed through allchannels including retail, web and partnerships with leadingOEM manufacturers like Dell, Hewlett-Packard, Motorola,and Philips.

‹‹ As we look into the future, mobile computing

capabilities will continue to grow, 3G networks will

become commonplace and the methods of connec-

ting devices will continue to expand. These trends

will help to redefine the digital experience and BVRP

will continue to develop software that help people to

make the most of these trends. ››

‹‹ “Small businesses vary tremen-

dously by type of industry, size of

company and target customer, but

they all have a common requirement

to use resources efficiently and spend their valuable time

growing their business. MySoftware’s commitment

to deliver powerful solutions to the expanding and ever-

changing small business market illustrates the company’s

passion for the entrepreneurial spirit that continues to

make MySoftware successful. ››

Bob LangPresident Mobility Software Division

Productivity Division

Utilities Division

‹‹ Consumers find our

products deliver more than

expected, a high level of

quality and great value ››

Anne AndersonExecutive VP Productivity Division

Frank van GilluwePresident UtilitySoftware Division

Small businesses make up approximately90% of worldwide employers totaling over40 million businesses with less than 100 employees. More than 500 thousandnew small businesses are created everyyear. MySoftware recognizes that this sector is

expanding and demanding effective solutions to compete intoday’s fast paced economy. With the purchase of Elibrium in2004, now Avanquest USA, BVRP acquired the MySoftware lineof office productivity products. The MySoftware range addressessmall business needs and has been trusted by more than 10 million small business and home office customers. Small businesses have many challenges ranging from limitedresources to competition from large chains. MySoftware products save small business owners time and money byproviding them with easy-to-learn and easy-to-use tools tocommunicate with their customers, organize and track their products, create marketing materials to drive business and effectively manage their finances. Currently, the products are sold in the United States and UnitedKingdom through retail stores, the Web, direct sales and partnersincluding Avery, Pitney Bowes and Visa. In a near future,MySoftware products will be available to small businesses throughout Europe and Asia.

Avanquest Publishing


‹‹ For nearly 20 years, the company has focu-

sed on building the retail infrastructure neces-

sary to create a global publishing network. Our

ability to leverage this expertise with partners

and developers on a global scale is unprece-

dented, and offers companies worldwide new

ways to expand sales without incurring the millions

in cost associated with sales, marketing, opera-

tions and finance. ››

‹‹ The power of Avanquest as a global player in the software mar-

ket is just beginning to emerge. Existing partners are expanding

into additional Avanquest territories and in 2004 alone, we were

approached by over 200 new publishers. As we continue to build

our channels, Avanquest is quickly becoming the clear alterna-

tive for both large and small software developers to sell and mar-

ket their software around the world. Moreover, for channel part-

ners Avanquest has become an essential supplier of world class

software. ››

Ability to source outstanding technology from around the world

Andy GoldsteinAvanquest Publishing Executive Director, Europe

Christina Seelye Avanquest Publishing Executive Director, Americas & Asia

With an unmatched ability to source outstanding technology from aroundthe world, the Avanquest worldwide network ensures expert organization forretail, ESD and corporate product distribution, effectively guaranteeingreliable and timely product launches. Further, Avanquest’s ability to createcustomized programs not only alleviates risk for third party developers,but also reduces product evaluation time for buyers. The result is better relations with developers and channel partners which leads directlyto stronger sales across all channels.In addition to providing developer partners access to the more than $5 Billionretail market, Avanquest also delivers sales and marketing programs,technical support localization, press relations, packaging, design andconsultation, production, assembly, logistics and channel financial mana-gement, all customized to each partner’s needs. Accordingly, Avanquest ’stwo decades worth of experience in marketing, publishing and selling products in retail channels contributes tremendously to Avanquest possessing market share dominance in numerous software categoriesaround the world. With market share dominance comes the successful salesof over 70 active products in all markets, collectively sold in over 15,000retail store locations, via thousands of corporate resellers and VARs, worldclass OEM partners and a growing presence in online sales. As a result,Avanquest sells over 20 million units annually across the globe. Clearly, theGlobal and Channel strategies are working, and working well.

Avanquest is dedicated to providing people around the world accessto the technology they need whenever they want it. The Avanquestpublishing model provides technology developers with the most efficient and cost-effective solution for selling their products on retailshelves, via corporate channels, online and via OEM partners.Combining experienced product management, in-house packagingdesign, effective supply chain management systems, our ownElectronic Software Download (ESD) technology and proven directretailer, corporate reseller and OEM relationships, Avanquest provides one-stop publishing solutions to developers anywhere inthe world.

With experienced management teams deployed worldwide and loca-lization in more 26 languages, Avanquest can penetrate new marketsquickly, using established distribution channels to avoid the expenseof investing in the set-up of organizational structures. The companyalso benefits from the reputation and knowledge of well-establishedcompanies in each territory, in turn giving each product the bestchance for profitable success.

Strategic distribution and placement via Avanquest France, AvanquestUK, Avanquest USA, Avanquest Germany, Avanquest Spain - andAvanquest Italy on target for 2005 - improve cost effectiveness by providing access to all target customer types including consumers,small and mid-size companies and large corporate customers. Theresult has been the proven combination of rapidly increasing revenueswith the lowest possible investment for developers.

The most ringing endorsement for the Avanquest Global and ChannelStrategies comes from one of our many Client/Partners:

Avanquest Publishing Global Strategy & Channel Strategy

Joshua Blanchfield CEO of Tenebril Incorporated

‹‹ By working with Avanquest,

our GhostSurf Pro product

launched into over 15 major US

retail chains within 4 months of its

first shipment. Within 6 months of

making the decision to expand

globally, GhostSurf Pro was

selling in more than 4 European

markets. By taking advantage of Avanquest's global

expertise and local sales relationships, economies of scale

and existing operational processes, customers in many

countries can find our product easily. ››

AVANQUEST PUBLISHING MODEL

When this success is multiplied by our current Client/Partner List, comprised of highly regarded software companies from around theworld, and the results quickly speak for themselves:Abbyy, Acronis, ACD Systems, BMG, BVRP, CyberLink, Eisenworld,IMSI, Intuit, Music Match, MySoftware, Map & Guide, Nova Development,Serif, Tenebril, Ulead, VCom, WinZip …

Developer

AvanquestPublishing

Wholesalers

Major Retailers

Corporate Dealers

VAR’S

MailOrder compagnies

General Resellers

E-Commerce Partners

Specialized stores

Corporation

SMB

SOHO

Consumers

R&D Worlwide Organization


‹‹ A new R&D organization has been

implemented to enable a smooth and powerful

increase of internally developed software that

make up the Company’s Intellectual Capital and

fuel the Group’s future growth. ››Roger Politis Group FounderChief Technical Officer

Throughout 2004, the BVRP Group’s Research & Development capabilities have been significantlyenhanced and reinforced, with two main goals in sight:

> To build an engineering organization that is both flexible and efficient, and capable of providing the newly constituted Product Divisions with the competitive and innovative software they need, and

> To ensure, right from the product’s design and development stages, that it will be suitable whenready to ship for each and every distribution channel available within the Group: OEM, theAvanquest Online Shop, the Avanquest Retail and Corporate channels.

The ultimate goal of this approach, considered in its global perspective, is naturally to make thebest possible usage of the Group’s Intellectual Property by ensuring its widest distribution globally, through all channels and in all territories.

To better support this strategy, the R&D effort has been reorganized in three distinct divisions matching each of the Product Divisions. Each of these groups is specialized in a product category, with its own, specific engineering teams, know-how and technology expertise.

> The « Mobility and Communications » R&D team is based in Levallois-Perret near Paris, andmainly develops the sofware marketed under the BVRP brand. These include such legacy pro-ducts such as FaxTools, PhoneTools, disgnostics and utilities, but also include the newest Mobilityand wireless products such as Mobile PhoneTools, LAN Wizard and Connections Manager.

> The « Productivity » R&D team based in San Mateo, CA, develops all products under the“MySoftware” brand, such as MyMailList or MyInvoices.

> The « Utility » R&D team is built around the recent acquisition of VCOM and is based in SanJose, CA, with an engineering team in Boulder, CO; It designs and develops the well-knownVCOM family of products that include System Suite, Fix-It utilities and Powerdesk.

In the constant effort to rationalize and optimize the organisation, the two product divisions located inNorthern California have been merged in common offi-ces in Pleasanton.Each of these R&D teams is run by a Chief TechnicalOfficer, reporting to the Group CTO – thus ensuringthe best possible consistency across all engineeringteams with regard to common tools, processes andmethodology, as well as the best possible usage ofcommon development of modules and IT infrastructure.

To accommodate as smoothly as possible the gro-wing needs of research & development, the enginee-ring resources located in BVRP’s China offices have alsobeen strengthened: today, there are no less than threeteams totalling around thirty engineers, regrouped in asingle, modern location in Shanghai, complementingthe main R&D teams for every type of developmentand design.

This global, pro-active and consistent approach hasgiven the Group the strong R&D tool that is essentialto its future development. It will enable a smooth andpowerful increase of software development in thecoming years, within all the product categories thatcomprise the Company’s intellectual capital.

Avanquest Software’s global OEM, PC, peripheral and mobile telephonemanufacturer partners regard the Company as an entity that creates added value for their products. BVRP solutions are bundled with the manufacturers' equipment to provide a new dimension tothe product and make it more user-friendly, more feature-rich and morecompetitive. Both, Mobile PhoneTools® and Pocket PhoneTools® are exam-ples of BVRP products, bundled with mobile phones, personal assistants andBluetooth™ devices, giving users fast internet access via 2G and 3G networks, SMS/faxes transmission, phonebook and calendar managementfeatures to name but a few. The aim is to facilitate connection and offer a range of user-friendly andintuitive communication tools with a few clicks of a mouse.This success with major telecommunications and IT companies is also dueto the fact that BVRP software is localized and translated into some 30 lan-guages.BVRP Software's diagnostic and self-repair solutions are also developing inthis direction. BVRP helps OEMs to reduce their maintenanceand support costs by integrating into new PCs or networks such pro-ducts as Modem Helper®, Modem Medic, Modem Xpert® and Lan Wizard.These tools reduce technical support calls as well as unjustified returns ofhardware by identifying the source of the technical problem, and if needed,by replacing the corrupted files. This generates significant savings for manu-facturers while fostering greater customer satisfaction.

OEM activities represent approximately 26% of their software turnover, andexperienced growth by nearly 60% in 2004. The quality and univer-sality of its products have won accounts with renowned ITand telecommunication corporations:Amigo, Askey, Asustek, Bewan, Bouygues, Billionton, Blueway, BritishTelecom, Com1, Conexant, Creatix, Dell Computer, EADS, Enfora, Falcom,France Telecom, Freescale, Fujitsu-Siemens, Global Suntek, Hayes, HewlettPackard, Kyocera-wireless, Intel, Lexmark, LightSpeed, L&M Technologies,Motorola PCS, Motorola iDEN, Multi-Tech, Mitsubishi, Netgear, Optimus,Opticom Communications, Packard Bell, Philips, Pretec, Sagem, Siemens,US Robotics, Vantage Mobile, Way Telecom, Windigo, YX Wireles, andZoom.

In keeping with the growth and development of its OEMpartners, Avanquest Software has expanded its operationsinto China & Korea.

This Asian expansion constitutes an important new pillar in the compa-ny’s ongoing global growth strategy, strengthening its existing OEM partnerships with leading manufacturers of computer hardware andmobile phones that operate Asian production facilities, including HP,Motorola, Kyocera, Lexmark and Dell.

The launch of Avanquest Korea in the Korean capital, Seoul, and AvanquestChina in the mainland China’s western manufacturing and commercial center, Shanghai, combines with the strengthening of a now-fully operatio-nal R&D center in Shanghai to facilitate the company to advance in Asia,second only to the U.S. as the most important software market worldwide.

David WrightPresident OEM Division

Software sales through the Original EquipmentManufacturer (OEM) channel result from agreementssigned with manufacturers of modem, microcomputer,personal assistant and mobile telephone equipment,with Avanquest Software products forming one of thecomponents of the overall hardware package.

OEM Presence & Outstanding Successes


‹‹ After 16 years with BVRP, I am still

amazed at continued innovative features

and the quality of our products.

Our partners appreciate the valuable

cost savings and value-add software

that we develop. ››

Avanquest Online


E-commerce is a strategic development focus for the Avanquest Softwaregroup. During 2004, the Company generated 4 % of total sales via theInternet through multiple regional websites; For 2005, the company hasset a target of doubling online sales of its software products and thoseof its publishing partners, with the goal of making e-commerce salesaccount for 10% of the Group’s turnover by end 2006.

The Internet marketing of all products, in all territories is now guided by a specific international Web division.

Based on a powerful e-commerce platform developed entirely by thegroup, Avanquest Online offers a unified, global master catalogue of allAvanquest software titles worldwide. The new “online boutique” enablesaccess to a comprehensive, unified product catalogue which is adap-table to the language and needs of local users.

An ambitious strategy for developing e-commerce sales

Following the launch of Mobileffects (http://www.mobileffects.com), itsmobile content download site and the acquisition of California’sVCommunications (http://www.v-com.com), which does a third of itssales on the Web, Avanquest Software is pursuing and strengtheningits strategy for developing Web sales by completely reworking itsonline sales sites and creating the Avanquest Online Store(http://www.shop.avanquest.com).

The online sales development program, which includes a unified software catalogue accessible in different ways in each country, is aharmonious complement to the strategy of publishing through allchannels, retail, corporate, VAR and OEM developed successfullyby the Group worldwide.

Fabrice le Camus Executive VP Web Division

‹‹ For software publishers, the Internet has become a major distribution channel.

Avanquest Software offensive strategy in this area, our online marketing

expertise, and the strength of our commerce platform, combine

for significant impact on the Company’s future growth. ››

International e-Commerce StrategyAvanquest Online Store

Andy Goldstein Executive Director, Avanquest Publishing

Human Capital & Strength

20/21Avanquest Software Teammates

2004 brought BVRP, now Avanquest Software, to a total employee count of more than 300 teammates. All gathered in June to celebrate

20 years of passion, growth and innovation.

Founded by Bruno Vanryb and Roger Politis,the software developer celebrated its 20th anni-versary in 1984. From a mere two employees atits inception, BVRP has grown to a world-widepresence, with over 100 million software packa-ges sold in 26 languages over the last 20 years.For 20 years, BVRP's employees and managershave given top priority to creativity and imagina-tion, which has allowed them to design, manageand integrate innovation into their products, ena-bling the convergence between personal com-puters and communications technology.BVRP, now Avanquest Software, is made up ofwomen and men who -- for almost 20 years forsome and a few months for others -- acceptnew challenges every day:

A Passion for Innovation

No business specializing in technology will sur-vive without anticipating the new needs anduses that are generated through technologicaladvances. At Avanquest Software, a mindset ofongoing innovation is shared by all our employees. This translatesinto a constant will to detect future IT markets in order to preserveour lead over the competition. However, at Avanquest Software,we are still extremely pragmatic; we never forget that we are desi-gning products for the consumer's use. Therefore, our softwareputs together high added value, outstanding user-friendliness, andan intuitive design that takes into account the user’s comfort aswell as technical performance. Hence, Research and Development is at the core of our company –nearly 30% of our workforce is dedicated to it!

A Culture of Change

In order for a business, which has been present since the field of hightechnology originated, to continue to grow and develop, it has no

choice but to evolve, anticipate change andadapt to a continually changing environment. Todevelop a winning strategy, Avanquest Softwarehas seen to it that a flexible organization, withshort decision-making processes and sharedresponsibilities, are maintained. This flexiblestructure ensures that our collaborators will bemotivated, since each one will be able to findtheir niche and thrive. Communication betweencollaborators from the various services, subsi-diaries and countries fosters exchanges (formalas well as informal), consulting, teamwork andmutual help. We also pledges to take intoaccount the human factor, which contributes tothe creation of added value and thus representsa key factor to competitiveness. Each of oursubsidiaries invests in training that reaches potentially all employees: technical training,development of competencies, foreign languageinstruction, management training, etc.Despite constant technological evolution andchanging economic conditions, Avanquest

Software is a great place to be!

A Responsible Work Ethic

Lasting development will not exist without ethics. Performance endu-res only when it goes hand-in-hand with ethics; we must not onlyrespect our customers - since without them the business cannot exist-- but also our shareholders who support the company during itsgrowth, as well as our suppliers. However, most importantly are thecollaborators, spread all over the world, and without whom Avanquestwould have never been able to experience such growth. Thanks to its collaborators’ superior skills and through always clingingto its values, Avanquest Software has managed to adapt and to per-sist as a company capable of anticipating new users’ needs, thusgenerating enduring and profitable growth.

Bruno Vanryb Group Founder Chief Executive Officer

Roger Politis Group FounderChief Technical Officer

Thierry BonnefoiChief Financial Officer

Bob LangPresident Mobility Software DivisionPresident Avanquest Software USA

Frank van GilluwePresident UtilitySoftware Division

Anne AndersonExecutive VP ProductivitySoftware Division

Chris ThompsonManaging Director

David WrightPresident OEM Division

Christina Seelye President & CEOAvanquest Publishing USA

Fabrice le Camus General Manager

Fabrice le Camus Executive VP Web Division

Jolyon Ostrick General Manager

MOBILITY

UTILITY

PRODUCTIVITY

USA

UK

FR

SP

Company Organization

Avanquest Software Product Management Team

BVRP 20th Anniversary

Avanquest Deutschland Teammates

DE

Avanquest Software is a company founded

on responsibility and ethics.

Sustainable Development& Corporate Governance

22/23Sustainable Development & Corporate Governance

As with any software publisher, BVRP now Avanquest Software’s acti-vity as such has no measurable impact on the environment. However,the question of sustainable development, as it stands today, is far fromsimply an ecological approach: it is becoming one of the key factors inthe running of a modern business, for which growth must mean prog-ress, not only in the economic sector but also in other sectors.

We understand that no company can be viable in the long term if it doesnot have a balanced economic and social structure that takes its envi-ronment into account. Therefore, from the outset BVRP has endeavo-red to listen to its users to ensure it assumes its responsibility towardsall of its stakeholders, be they stockholders, customers, suppliers oremployees.

Hence the Company’s drive for sustainable development, grounded in twokey factors: respect for stakeholders and transparent communication.

Relationship with stockholders

A public company since 1996, BVRP – now Avanquest Software - hasvoluntarily implemented a policy of constant information and permanentdialogue with its 8,609 stockholders:

> All financial updates, corporate announcements and annual reportsare sent to those holding than 500 shares or more.

> The company answers all requests for information from stockhol-ders, irrespective of the number of shares they hold.

> The company runs a 100% bilingual communication system, upda-ted in real time on the group’s websites, which contain all publishedinformation.

> Business updates are an essential part of all general meetings andanalysis reviews, held at least twice a year.

By entering the Euronext Next Economy business segment as of itscreation in 2002, group management has committed the company to fur-ther transparency, publishing quarterly results and applying InternationalAccounting Standards, all of these have been fully implemented in 2004.

Gilles Quéru

Bertrand Michels

Jean-Claude Vrignaud

Jean-François Dufrasne EURIDI

Olivier Hua TURENNE

Nana KurosawaDirector of BusinessDevelopment, Asia

‹‹ I am always attentive and listen to the technical

evolution demands of our partner customers.

These are the people that push us in the right direction! ››

Sustainable Development & Corporate Governance 24/25

Corporate Governance

The Board of Directors includes BVRP Software’s two founders, in chargeof Strategy, R&D, Human Resources, and the Group Chief FinancialOfficer. This collegial management ensures important decisions alwaystake into account strategic, technical, human and financial factors. A broa-der Executive Committee, which also includes the general managers ofsubsidiaries in Germany, the UK, the US and France, meets on a regu-lar basis. A real decision-making body, the Executive Committee is alsoa think-tank for sharing and analyzing strategic information before col-lectively determining how the company will move ahead.On the other hand, the BVRP Board of Directors includes a high proportionof non-executive members: Gilles Quéru, founder and CEO of Invigo, andJean-Claude Vrignaud, President of Acoma Consulting Inc. will com-plement AB Soft founder Bertrand Michels in representing the industryworld. Turenne Capital Partners and Euridi have also joined the group’sBoard of Directors as a consequence of the increase in capital tookplace in September 2003. They represent the financial world.The Avanquest Software Board of Directors mirrors the group’s deter-mination to grow in the USA: in addition to Bob Lang, President ofAvanquest Software USA, Christina Seelye, President of AvanquestPublishing USA, and Andy Goldstein, Executive Director of AvanquestDeutschland, all of whom are American, Gilles Quéru and Jean-ClaudeVrignaud also bring extensive experience in the American market, havingworked there for all or part of their careers.Members of the Board of Directors have access to the same informa-tion as Group Executives, and a Compensation Committee has been putin place in 2002. They are consulted on a regular basis, each time impor-tant decisions need to be taken in real time.

Relationship with employees

The founders have always tried to make BVRP Software a companythat is “good to work for” by creating a pleasant, secure environment,independent of the economic climate or the need to remain constantlycompetitive. For this reason, dialogue and communication are always apriority. BVRP Software has had no major disputes with employees sinceits creation in 1984.A number of practices and tools have been put in place during theCompany’s 20 years to promote internal communication, improve theworking environment and foster career management:> The company Intranet is available to all and provides a source of

company data, including press releases, financial data, corporateinformation and internal events.

> Each salaried employee is free to meet with group executives onrequest and takes part in an annual, clearly structured, career develop-ment interview to promote constructive and objective communication.

> Employee stock ownership was first implemented in 1996 when theCompany went public, through a series of options schemes desi-gned to allow a large number of employees to hold a stake in thecompany.

Supplier management

Any company that wants to maintain margins and create value for stoc-kholders through profits must purchase at the best possible price andobtain optimal payment terms.To do so, we have developed long-term qualitative relationships with awide range of service providers, based on a number of rules:> Any investment involving an amount that exceeds a given threshold

must be subject to a request to tender that gives all service provi-ders access to the same level of information.

> On a comparable basis, preference is given to service providers thathave already worked with the group to help foster long-term part-nerships.

Relationship with customers

Our long-term relationships with customers and partners have allowedus to develop and market software packages that become best-sellersin their market, while staying abreast of the major technological chan-ges of the last twenty years. This quality relationship can only be set upthrough a process that combines sustainability, awareness and respect: > We constantly strive to update our product offering to reflect new

technological developments and avoid any usability problems on

release of new versions. For example, this includes upward compa-tibility of different software versions and ensuring smooth operationwith later versions of Windows.

> Products under guarantee will be exchanged or refunded if any related issues cannot be resolved to the customer’s satisfaction.

Avanquest Software solutions are primarily designed and conceived tomeet customer requirements. Our development model is based onupgrade requests sent to the technical support service and the resultsof regular user/distributor satisfaction surveys.

Avanquest Software is a company founded on responsibility and ethics. This responsibility permeates all walks of company life: Human Resources, CustomerRelations, Supplier Relations, Corporate Governance and aspects of our Civil Partnership.It is daily awareness of these priorities that is the basis of our sustainable development.

The BVRP Group on the Stock Exchange

26Stock Market Information Group

Up 39% in 2004 – BVRP outperforms every index

The BVRP Group’s operating performance and the success of its stra-tegy were greeted by a spectacular hike in its per-share price. After 1 55%increase in 2003, BVRP shares grew by more than 39% in 2004, onceagain posting a performance far ahead of the reference indexes (NouveauMarché and SBF 250). The rise is actually 56% if comparing the averageprice in 2004 with that during 2003.The first months of 2005 have confirmed this trend, with a new close to40% rise in four months, placing BVRP among the top 15 best perfor-mers in the SBF 250 since January 1, 2005.With capitalization now exceeding ¤100M and a daily share trade volumeup sharply since summer of 2004, in January 2005 BVRP joined theCAC Small 90 and SBF 250 indexes, newly created by Euronext.Always favoring information quality and transparency, BVRP Software,which has been part of the Next Economy segment since it was crea-ted in 2002, presented its annual accounts according to IFRS standardsin 2004, a year ahead of time.

Outstanding shareholders

ANVAR approval, which BVRP obtained in 2003, and the strong rene-wed interest in small and mid-cap securities, contributed to the signifi-cant strengthening of the weight of investment funds in BVRP’s capital.In 2004, Edmond de Rothschild Investment Partners, a subsidiary of LaCompagnie Financière Edmond de Rothschild, went beyond the 5%threshold in the capital of BVRP Software, and AGF Private Equity tooka +4% shareholding after acquiring and then converting all of the conver-tible loan stock (Océane) still held by Société Générale. Today some 300 funds, including Fidelity Investment, involved sinceBVRP’s introduction into the stock market, are holding 62% of BVRP capi-tal (as against 57% at the end of 2003 and 40% in 2002).BVRP today has 8,600 shareholders (source: Sicovam, December 2004).

Roger Politis 191 939 3,14%

Bruno Vanryb 142 500 2,33%

Bertrand Michels 92 984 1,52%

Andrew Goldstein 92 137 1,51%

Robert Lang 25 445 0,42%

Thierry Bonnefoi 22 080 0,36%

Funds managed by Turenne Capital Partners 556 550 9,11%

Funds managed by Euridi 340 000 5,56%

Subtotal 1 Joint action 1 463 635 23,95%

Fidelity * 378 637 6,20%

Edmond de Rothschild IP* 296 142 4,85%

AGF Private Equity* 253 925 4,16%

AFER Flore * 172 112 2,82%

BVRP 1 940 0,03%

Public 3 543 637 58,00%

Subtotal 2 4 650 393 76,11%

Overall Total 6 110 028 100%

*Estimation

SHAREHOLDERS NB OF SHARES % CAPITAL

Analyst & Investor Relations: Thierry BonnefoiTel. : +33 (0) 1 41 27 19 [email protected]

Corporate Communications: Christine SauvagetTel. : +33 (0) 1 41 27 19 [email protected]

Conception-Réalisation: gestecomTel. : +33 (0) 1 41 22 38 00

2 Contents

3 Founders’ Statement

4 Annual Results

6 Year 2004 Hightlights

8 Avanquest Software Group

10 Avanquest Software

11 Avanquest Publishing

14 Worldwide Organization

16 OEM Presence

18 Avanquest Online

20 Company Organization

21 Group Teammates

22 Sustainable Development

and Corporate Governance

26 The Company on the Stock Market

Contents

Photography : Thierry Vasseur

foundersâ€™statement bvrp software becomes

Documents