Online software provider NetStore announced stronger than expected results for its first year since listing on the Stock Exchange.

The group, which offers small and medium-sized firms the chance to buy software for a fixed fee over the internet, said it had met or exceeded all of its targets set when it joined the London market in April.

NetStore was the first application service provider (ASP) to float in Europe, and the company has nearly quadrupled its workforce, from 20 in 1999 to 74 at present.

Last week NetStore linked up with BT, its third strategic partner signed up to help it survive in the fiercely-competitive new industry.

Turnover in the year to June 30 nearly doubled, from £757,000 to £1.37 million.

Pre-tax losses rose to £4.89 million from £1.13 million for the comparable period, but the company stressed this was better than expected.

Chief executive Gary Smith said: "We are delighted that NetStore is continuing to perform strongly and is meeting or exceeding all the targets we set at our initial public offering.

"We are continuing to build on our position as leader of Europe's emerging ASP industry and this leadership is being recognised by software vendors such as Microsoft, and by the major telecommunications companies, three of which have signed strategic agreements to resell our services.

"Our plan is to deliver a steady stream of new application services is on track but most importantly we are delivering active end-users across our service portfolio, proving that our proposition is attractive to our target market."

Mr Smith believed that buying software over the internet would rapidly increase in years to come, and said: "The ASP deliver model is central to how we will use application software in our daily working lives in the very near future."