Final Results

 

TIDMECK 
 
RNS Number : 9153N 
Eckoh PLC 
21 June 2010 
 

21 June 2010 
 
                                    Eckoh plc 
                            ("Eckoh" or "the Group") 
 
                              Preliminary Results 
 
Eckoh plc, the UK's leading developer of speech recognition solutions for 
customer contact centres, announces its results for the year ended 31 March 
2010. 
 
+----------------------------------------+---------+---------+ 
|                                        |         |    Year | 
|                                        |    Year |         | 
|                                        |   ended |   ended | 
|                                        |      31 |         | 
|                                        |   March |      31 | 
|                                        |    2010 |   March | 
|                                        | GBP'000 |    2009 | 
|                                        |         | GBP'000 | 
+----------------------------------------+---------+---------+ 
| Turnover                               |   7,923 |   6,674 | 
+----------------------------------------+---------+---------+ 
| Gross profit                           |   5,697 |   4,279 | 
+----------------------------------------+---------+---------+ 
| Operating loss                         |   (534) | (1,755) | 
+----------------------------------------+---------+---------+ 
| Loss for the period                    |   (118) |   (878) | 
+----------------------------------------+---------+---------+ 
| Adjusted* EBITDA                       |     849 |   (295) | 
+----------------------------------------+---------+---------+ 
| Adjusted* profit/(loss) before         |     657 |   (387) | 
| taxation                               |         |         | 
+----------------------------------------+---------+---------+ 
 
[All figures reported are for continuing operations of the Speech Solutions 
division following the merger of the Client IVR division (shown as discontinued 
operations) with Telecom Express Ltd.] 
 
 
Financial Highlights: 
 
·      19% growth in revenue from continuing operations from GBP6.7m to GBP7.9m 
 
·      Increase in continuing gross margin to 72% (FY09: 64%) resulting in a 33% 
growth in continuing gross profit to GBP5.7m (FY09: GBP4.3m) 
 
·      FY10 adjusted* profit before taxation of GBP0.7m (FY09: loss of GBP0.4m) 
 
·      Adjusted* EBITDA amounted to a profit of GBP0.8m (FY09: loss of GBP0.3m) 
 
·      Operating loss from continuing operations reduced to GBP0.5m (FY09: loss 
of GBP1.8m) 
 
·      Strong debt free financial position with a cash and short term investment 
balance of GBP3.9m (FY09: GBP5.2m) 
 
 
Operational Highlights and Recent Contract Wins: 
 
·      Restructuring of Board composition during the year resulting in basic 
Board cost reducing by 28% 
 
·      3 year contract renewal with William Hill for the provision of customer 
service options 
 
·      New contracts for the provision of automated card payments services to 
Northumbrian Water and Dwr Cymru Welsh Water 
 
·      3 year contract renewals with two existing water utility clients for the 
provision of card payment solutions 
 
·      Major investment in technology refresh strengthening market leading 
position 
 
·      Good progress towards becoming PCI ("Payment Card Industry") Compliant 
 
·      Closure of office in Montpellier to produce cost saving and operational 
efficiencies. The closure will be completed on 30 June 2010, but all estimated 
costs in relation to the closure have been provided for in 2009/10 
 
 
Post period developments: 
 
·      Merger of Client Interactive Voice Response ("IVR") division with Telecom 
Express Limited, with Eckoh taking a 27.5% share of the combined business 
 
·      3 year contract with a government executive agency to provide service for 
logging the movement of livestock 
 
*on continuing operations excluding non-recurring administrative expenses, 
amortisation of intangible assets and share option charges 
 
Nik Philpot, Chief Executive Officer, commented today: 
 
"Despite the backdrop of continuing economic uncertainty, Eckoh has been able to 
build on the good progress we made last year and deliver an excellent set of 
results. It is clear from the strong growth achieved that there is a tremendous 
opportunity to drive significant profits and value for shareholders in the 
speech sector going forward. The agreement to merge the Client IVR business is 
the final step in making Eckoh a pure Speech Solutions company, and we can now 
focus all our energies on continuing this growth and maximising our market 
leading position." 
 
 
For further enquiries, please contact: 
 
Eckoh plc 
Nik Philpot, Chief Executive Officer 
Adam Moloney, Group Finance Director 
www.eckoh.com                                                Tel: [phone] 
Corfin Public Relations 
Harry Chathli, Claire Norbury                               Tel: [phone] 
 
Seymour Pierce 
Jonathan Wright                                                 Tel: [phone] 
8000 
 
Introduction 
The Directors are pleased to report a year of significant financial improvement 
on the continuing operations and the completion of the final steps required to 
position Eckoh as a pure Speech Solutions business. During the year, strategic 
decisions were taken to sell the Client Interactive Voice Response ("IVR") 
division, close the technical office in France and reorganise the Board. This 
has left a rapidly growing Speech Solutions business with an appropriate cost 
base and an opportunity for significant shareholder value to be generated. 
 
Financial Review 
 
Revenue and Margin 
The 2010 financial year built on the momentum of the prior year, with revenue 
from continuing operations increasing by 19% to GBP7.9m (FY09: GBP6.7m). The 
margin achieved on these revenues has grown to 72% (FY09: 64%), with gross 
profit increasing by 33% from GBP4.3m to GBP5.7m. 
 
No single client represents more than 16% of the margin generated. Consequently, 
there is no great dependency on any individual client for the financial 
sustainability of the business. 
 
The cost base of the Group is largely represented by the employees, who are 
predominantly in the areas of service development, delivery and support. This 
headcount is deployed on a mix of delivering new client business, maintaining 
and improving existing clients' services, developing Eckoh products and special 
projects such as the PCI accreditation process. When new business is won, this 
does not typically require an increase in headcount and associated overhead 
costs unless it is likely to consume very specialist resources for extended 
periods. As a result, growth in revenue usually contributes directly to the 
profitability of the business. 
 
Administrative Expenses 
+----------------------------------------+----------+----------+ 
|                                        |     2010 |     2009 | 
|                                        | GBP000's | GBP000's | 
+----------------------------------------+----------+----------+ 
| Administrative expenses before         |    5,578 |    5,223 | 
| non-recurring items                    |          |          | 
+----------------------------------------+----------+----------+ 
| French office closure costs            |      286 |        - | 
+----------------------------------------+----------+----------+ 
| Employee restructuring                 |      306 |       16 | 
+----------------------------------------+----------+----------+ 
| EGM costs                              |       61 |        - | 
+----------------------------------------+----------+----------+ 
| Legal settlement                       |        - |      627 | 
+----------------------------------------+----------+----------+ 
| Aborted transaction costs              |        - |      168 | 
+----------------------------------------+----------+----------+ 
| Total administrative expenses          |    6,231 |    6,034 | 
+----------------------------------------+----------+----------+ 
 
As detailed in the table above, administrative expenses arising from the 33% 
increase in margin increased by only 3% from GBP6.0m to GBP6.2m. Adjusting the 
administrative expenses for nonrecurring items of expenditure, administrative 
expenses still grew by only 7% from GBP5.2m to GBP5.6m. 
 
Aside from the EGM costs, the non-recurring items of expenditure arising in 
2009/10 will produce significant operational and financial benefits in future 
financial years. The employee restructuring expense largely consists of the 
severance costs arising from a restructuring of the Board, which has reduced the 
basic cost of the Board by 28%. 
 
Eckoh has had a technical support office in Montpellier, France, for over 10 
years and has benefitted from the expertise of some excellent employees. Over 
this period, the number of French staff has gradually declined whilst the 
adverse exchange fluctuation of the Pound against the Euro has significantly 
increased the cost of the operation, leading to the difficult decision being 
made to close the office. Whilst the severance costs of French employees are 
high, it was felt that the long term financial benefit of closing the office, 
along with the operational efficiency arising from having all Eckoh employees in 
one location, was worthwhile. The Group is committed to this closure, which will 
be completed by 30 June 2010. The estimated costs in relation to this closure 
have been provided for at the year end. 
 
Profitability measures 
+----------------------------------------+---------+---------+ 
| Adjusted profit                        |    2010 |    2009 | 
|                                        | GBP'000 | GBP'000 | 
+----------------------------------------+---------+---------+ 
| Loss before tax from continuing        |   (197) | (1,373) | 
| operations                             |         |         | 
+----------------------------------------+---------+---------+ 
| Amortisation of intangible assets      |     157 |     121 | 
+----------------------------------------+---------+---------+ 
| Share option charges                   |      44 |      54 | 
+----------------------------------------+---------+---------+ 
| Non recurring items of expenditure     |     653 |     811 | 
+----------------------------------------+---------+---------+ 
| Adjusted profit / (loss) before        |     657 |   (387) | 
| taxation                               |         |         | 
+----------------------------------------+---------+---------+ 
|                                        |         |         | 
+----------------------------------------+---------+---------+ 
| Net interest receivable                |    (99) |   (382) | 
+----------------------------------------+---------+---------+ 
| Depreciation                           |     529 |     474 | 
+----------------------------------------+---------+---------+ 
| Arrangement fees on loans              |   (238) |       - | 
+----------------------------------------+---------+---------+ 
| Adjusted EBITDA                        |     849 |   (295) | 
+----------------------------------------+---------+---------+ 
 
The table above illustrates the progress in the profitability made by the Group 
with an adjusted loss of GBP0.4m for FY09 converted into a profit of GBP0.7m for 
this year. Adjusted EBITDA has improved from a loss on continuing operations of 
GBP0.3m to a profit of GBP0.8m. Excluding the adjustments, the loss before tax 
from continuing operations reduced from GBP1.4m to GBP0.2m. The Speech Solutions 
business has reached a level of maturity where it can be self-sustaining, and is 
well-positioned to take advantage of the market opportunity and further improve 
profitability in the coming years. 
 
Statement of financial position 
During the year, there has been a significant investment in the infrastructure 
supporting the Speech Solutions business, from which it will benefit for several 
years. This has resulted in GBP1.0m of equipment acquisitions. This led to a 
reduction in cash balances from GBP5.2m to GBP3.9m in the year. No further 
capital expenditure of this magnitude is planned in the medium term. In addition 
to the GBP3.9m cash balance, a loan of GBP2.9m is due to be repaid by Redstone 
plc in two instalments in October 2011 and October 2012, which will further 
increase the strength of the Group's balance sheet. The renegotiation of the 
terms of this loan resulted in arrangement fee income of GBP0.2m to be 
recognised in the year with a further GBP0.3m being spread over the remaining 
term of the loan. No significant impact on the statement of financial position 
is anticipated to arise from the discontinued Client IVR division. 
 
 
Operational Review 
 
Speech Solutions 
Eckoh is a leading developer of speech recognition solutions for customer 
contact centres and is the largest provider of such hosted services in the UK. 
 
Eckoh's sophisticated technology enables routine enquiries, transactions or 
payments to be processed without the need for the consumer to speak with a 
contact centre agent. This significantly reduces the client's operational costs, 
whilst freeing up the agents to deal with more complex and high-value enquiries. 
 
For large organisations seeking to maximise the efficiency of their contact 
centre operations, Eckoh is the specialist of choice and the services it 
provides are used by a wide range of mass market establishments to serve 
millions of their customers each year. 
 
The length of contracts with clients are generally for periods of at least 3 
years, and typically with guaranteed minimum levels of revenue either from fixed 
recurring fees or from specified volumes of call traffic or transactions, which 
gives excellent visibility on future revenues. 
 
Eckoh's technical infrastructure has the scalability to handle up to 8,000 
inbound phone calls simultaneously, which means calls can always be answered on 
a 24 hour-a-day basis no matter how unpredictable the circumstances and at a 
fraction of the cost of a live agent. During the year Eckoh made a major 
investment in a new VoiceXML call handling platform from Holly Connects and the 
established industry leader in speech recognition software, Nuance Recognizer 9. 
 
The first complex speech-enabled application to be launched on this new platform 
was a journey planning service for Transport for London, which went live in 
December 2009 (0843 222 1234). The worst winter weather for many years saw call 
levels to the new service increase dramatically in January from their normal 
levels, whilst comparable fluctuations occurred on National Rail Enquiries' 
TrainTracker service. Similarly, during the travel chaos following the eruption 
of the Eyjafjallajökull volcano in Iceland, the real-time flight information 
services that Eckoh provides for Heathrow and Gatwick airports experienced 
massive increases in demand during April. In all cases, the on-demand hosted 
solutions that Eckoh provide were able to deal effectively with the sudden 
dramatic call increases, clearly demonstrating the benefits offered by Eckoh's 
hosted services. 
 
As highlighted at the interim results (announced 9 December 2009), Eckoh is 
undertaking a two-year process to become compliant with the Payment Card 
Industry Data Security Standards ("PCI DSS"). GBP162,000 (FY09: GBP79,000) of 
expenses have been capitalised on the PCI DSS project in the 2009/10 financial 
year. This is a comprehensive set of requirements that all companies holding, 
processing or transferring customer payment card details are required to adopt. 
Eckoh is seeking to be accredited at the highest level and recent changes in the 
regulations extended the timescale of the project, but the process is now 
nearing completion with the conclusion expected by September 2010. The Group's 
client base in this area continues to grow, along with the volume of card 
payments being processed which is now at an annual run rate of GBP150 million, 
validating the effort Eckoh has expended in this area. As an example, Eckoh has 
recently announced contract wins with Northumbrian Water Limited and Dwr Cymru 
Welsh Water, together with contract renewals for two other existing utility 
clients. 
 
Other significant contract renewals with large clients include William Hill, 
which renewed its agreement for the provision of results, live commentary and 
call centre services for 3 years. 
 
New Products 
EckohPAY, which offers customers the ability to make real-time, secure and 
compliant phone and web card payments, is the first of the productised offerings 
that Eckoh has developed - and is designed specifically for the expected demand 
from PCI. The ability to sell such a product to a client and have the service 
live within a matter of weeks significantly broadens the market that Eckoh can 
target. Other products to be launched this year include EckohID, which helps 
companies identify callers and capture name and address information; 
EckohLOCATE, which enables calls to be routed efficiently and direct customers 
to store or dealer locations; and EckohSECURE, which allows companies to 
authenticate their customers with just their voices. Earlier in the year, Eckoh 
announced a 2-year contract to provide services to Comic Relief, and EckohPAY 
was successfully used on their behalf to collect over 38,000 donations totalling 
over GBP1.1m during the Sport Relief weekend in March 2010. 
 
 
Key Post-period Developments 
 
Discontinued Operations 
On 28 May 2010, Eckoh announced that the Group's Client IVR division ("the 
Division") had merged with Telecom Express Limited ("TE") in return for 27.5% of 
the issued share capital of the enlarged business. The Division had experienced 
a continuing difficult period with revenues falling by 29% to GBP8.8m for the 
year (FY09: GBP12.4m) and margin declining by 35% to GBP1.2m (FY09: GBP1.9m). As 
a result, the profit contribution fell to GBP0.05m compared with GBP0.7m for the 
previous year. The issues faced by the Client IVR division have been shared by 
all premium rate service providers as print circulations fall. The need to focus 
management efforts on the growing Speech Solutions business as well as to remove 
the compliance risk around the provision of premium rate services resulted in an 
exercise being undertaken to seek a means to remove the operation from the 
continuing Eckoh group. An agreement was reached with the owners of TE that a 
combination of the respective businesses would generate significant operational 
efficiencies and give the combined operation a prospect of increased future 
profitability. The results for the Client IVR division are shown within the 
discontinued operation disclosures on the income statement. The disclosures 
around the disposal will be presented in the interim results statement for the 6 
months ending 30 September 2010. 
 
Contract Win 
Eckoh achieved a significant client win after the end of the period with the 
signing of a 3-year contract with a government executive agency. This is for the 
provision of a speech recognition solution, due to go live in June 2010, to 
allow authenticated users to register the identity and movement of livestock. 
This contract builds on Eckoh's long-standing relationship with the UK 
government and its departments, including the Ministry of Justice and Transport 
for London, with the latter entering into a 5-year contract with Eckoh and its 
partner BT in July 2009. 
 
Outlook 
 
As a result of the strong progress made in growing the Speech division and the 
final restructuring of the Group, the Board remains highly confident of Eckoh's 
prospects. The strategic decisions, such as PCI compliance and the investment in 
new technical infrastructure, are already demonstrating their value and will 
ensure that the services provided by Eckoh remain ahead of those offered by its 
competitors. Whilst the sales focus will continue to target the high-value 
long-term contracts, the new range of Eckoh products, including the highly 
successful EckohPAY, will enable smaller size contracts to be won and deployed 
quickly. 
 
The future value of the Group will be derived from the growth attained from the 
Speech Solutions division, which is now the core focus of the Board following 
the merger of the Client IVR division with TE. 
 
Consolidated statement of comprehensive income 
for the year ended 31 March 2010 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |    2010  |     2009 | 
|                                     |     |  audited |  audited | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |  GBP'000 |  GBP'000 | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Continuing operations               |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Revenue                             |     |    7,923 |    6,674 | 
+-------------------------------------+-----+----------+----------+ 
| Cost of sales                       |     |  (2,226) |  (2,395) | 
+-------------------------------------+-----+----------+----------+ 
| Gross profit                        |     |    5,697 |    4,279 | 
+-------------------------------------+-----+----------+----------+ 
| Administrative expenses before      |     |  (5,578) |  (5,223) | 
| non-recurring items                 |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| French office closure costs         |     |    (286) |        - | 
+-------------------------------------+-----+----------+----------+ 
| Employee restructuring              |     |    (306) |     (16) | 
+-------------------------------------+-----+----------+----------+ 
| EGM costs                           |     |     (61) |        - | 
+-------------------------------------+-----+----------+----------+ 
| Legal settlement                    |     |        - |    (627) | 
+-------------------------------------+-----+----------+----------+ 
| Aborted transaction costs           |     |        - |    (168) | 
+-------------------------------------+-----+----------+----------+ 
| Total Administrative expenses       |     |  (6,231) |  (6,034) | 
+-------------------------------------+-----+----------+----------+ 
| Loss from operating activities      |     |    (534) |  (1,755) | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Finance income                      |     |      340 |      382 | 
+-------------------------------------+-----+----------+----------+ 
| Finance expense                     |     |      (3) |        - | 
+-------------------------------------+-----+----------+----------+ 
| Loss before taxation                |     |    (197) |  (1,373) | 
+-------------------------------------+-----+----------+----------+ 
| Taxation                            |     |        - |        - | 
+-------------------------------------+-----+----------+----------+ 
| Loss for the year from continuing   |     |    (197) |  (1,373) | 
| operations                          |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Discontinued operations             |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Post tax profit for the year from   |     |       79 |      495 | 
| discontinued operations             |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Loss for the year attributable to   |     |    (118) |    (878) | 
| the equity holders of the parent    |     |          |          | 
| company                             |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Other comprehensive income          |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Exchange differences on translating |     |      (8) |     (20) | 
| foreign operations                  |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Total comprehensive expense for the |     |    (126) |    (898) | 
| year attributable to the equity     |     |          |          | 
| holders of the parent company       |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Loss per share (pence)              |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Basic and diluted                   |     |   (0.06) |   (0.44) | 
+-------------------------------------+-----+----------+----------+ 
|                                     |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Loss per share from continuing      |     |          |          | 
| (pence)                             |     |          |          | 
+-------------------------------------+-----+----------+----------+ 
| Basic and diluted                   |     |   (0.10) |   (0.36) | 
+-------------------------------------+-----+----------+----------+ 
Consolidated statement of financial position 
as at 31 March 2010 
 
+----------------------------------+----+----------+----------+ 
|                                  |    |     2010 |     2009 | 
+----------------------------------+----+----------+----------+ 
|                                  |    |  GBP'000 |  GBP'000 | 
+----------------------------------+----+----------+----------+ 
|                                  |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Assets                           |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Non-current assets               |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Intangible assets                |    |      599 |      376 | 
+----------------------------------+----+----------+----------+ 
| Property, plant and equipment    |    |    1,160 |      714 | 
+----------------------------------+----+----------+----------+ 
| Loans and other receivables      |    |    2,925 |    1,700 | 
+----------------------------------+----+----------+----------+ 
|                                  |    |    4,684 |    2,790 | 
+----------------------------------+----+----------+----------+ 
|                                  |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Current assets                   |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Inventories                      |    |        5 |        4 | 
+----------------------------------+----+----------+----------+ 
| Trade and other receivables      |    |    2,490 |    4,476 | 
+----------------------------------+----+----------+----------+ 
| Short-term investments           |    |    1,821 |    2,821 | 
+----------------------------------+----+----------+----------+ 
| Cash and cash equivalents        |    |    2,067 |    2,421 | 
+----------------------------------+----+----------+----------+ 
| Assets held for sale             |    |      945 |        - | 
+----------------------------------+----+----------+----------+ 
|                                  |    |    7,328 |    9,722 | 
+----------------------------------+----+----------+----------+ 
|                                  |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Total assets                     |    |   12,012 |   12,512 | 
+----------------------------------+----+----------+----------+ 
|                                  |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Liabilities                      |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Current liabilities              |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Trade and other payables         |    |  (1,651) |  (3,812) | 
+----------------------------------+----+----------+----------+ 
| Obligations under finance leases |    |      (1) |      (3) | 
+----------------------------------+----+----------+----------+ 
| Liabilities directly associated  |    |  (1,504) |        - | 
| with assets held for sale        |    |          |          | 
+----------------------------------+----+----------+----------+ 
|                                  |    |  (3,156) |  (3,815) | 
+----------------------------------+----+----------+----------+ 
|                                  |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Non-current liabilities          |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Provisions                       |    |    (320) |     (79) | 
+----------------------------------+----+----------+----------+ 
|                                  |    |    (320) |     (79) | 
+----------------------------------+----+----------+----------+ 
|                                  |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Net assets                       |    |    8,536 |    8,618 | 
+----------------------------------+----+----------+----------+ 
|                                  |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Shareholders' equity             |    |          |          | 
+----------------------------------+----+----------+----------+ 
| Share capital                    |    |      499 |      499 | 
+----------------------------------+----+----------+----------+ 
| Capital redemption reserve       |    |      198 |      198 | 
+----------------------------------+----+----------+----------+ 
| Share premium                    |    |      695 |      695 | 
+----------------------------------+----+----------+----------+ 
| Currency reserve                 |    |     (55) |     (47) | 
+----------------------------------+----+----------+----------+ 
| Retained earnings                |    |    7,199 |    7,273 | 
+----------------------------------+----+----------+----------+ 
| Total shareholders' equity       |    |    8,536 |    8,618 | 
+----------------------------------+----+----------+----------+ 
 
 
 
Consolidated statement of changes in equity 
as at 31 March 2010 
 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
|                     |   Share |    Capital |   Share | Retained | Currency |        Total | 
|                     | Capital | redemption | premium | earnings |  reserve | shareholders | 
|                     |         |    reserve |         |          |          |       equity | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
|                     | GBP'000 |    GBP'000 | GBP'000 |  GBP'000 |  GBP'000 |      GBP'000 | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
|                     |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Balance at 1 April  |     499 |        198 |     695 |    8,097 |     (27) |        9,462 | 
| 2008                |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Total comprehensive |       - |          - |       - |    (878) |     (20) |        (898) | 
| expense for period  |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Share based payment |       - |          - |       - |       54 |        - |           54 | 
| charge              |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Balance at 31 March |     499 |        198 |     695 |    7,273 |     (47) |        8,618 | 
| 2009                |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
|                     |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Balance at 1 April  |     499 |        198 |     695 |    7,273 |     (47) |        8,618 | 
| 2009                |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Total comprehensive |       - |          - |       - |    (118) |      (8) |        (126) | 
| expense for period  |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Share based payment |       - |          - |       - |       44 |        - |           44 | 
| charge              |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
| Balance at 31 March |     499 |        198 |     695 |    7,199 |     (55) |        8,536 | 
| 2010                |         |            |         |          |          |              | 
+---------------------+---------+------------+---------+----------+----------+--------------+ 
 
 
Consolidated statement of cashflows 
for the year ended 31 March 2010 
 
+-----------------------------------+------+----------+---------+ 
|                                   |Note  |          |    2009 | 
|                                   |      |     2010 |         | 
+-----------------------------------+------+----------+---------+ 
|                                   |      |  GBP'000 | GBP'000 | 
+-----------------------------------+------+----------+---------+ 
|                                   |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Cash flows from operating         |      |          |         | 
| activities                        |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Cash utilised in operations       |  3   |    (979) | (2,836) | 
+-----------------------------------+------+----------+---------+ 
| Interest paid                     |      |      (3) |       - | 
+-----------------------------------+------+----------+---------+ 
| Taxation                          |      |        - |    (45) | 
+-----------------------------------+------+----------+---------+ 
| Net cash utilised in operating    |      |    (982) | (2,881) | 
| activities                        |      |          |         | 
+-----------------------------------+------+----------+---------+ 
|                                   |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Cash flows from investing         |      |          |         | 
| activities                        |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Purchase of property, plant and   |      |  (1,003) |   (443) | 
| equipment                         |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Purchases of intangible fixed     |      |    (380) |   (383) | 
| assets                            |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Decrease / (Increase) in          |      |    1,000 | (1,291) | 
| short-term investments            |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Loans repaid by third parties     |      |        - |     500 | 
+-----------------------------------+------+----------+---------+ 
| Interest received                 |      |      396 |     382 | 
+-----------------------------------+------+----------+---------+ 
| Net proceeds on disposal of       |      |      617 |   1,234 | 
| business operations               |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Net cash generated in investing   |      |      630 |     (1) | 
| activities                        |      |          |         | 
+-----------------------------------+------+----------+---------+ 
|                                   |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Cash flows from financing         |      |          |         | 
| activities                        |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Continuing operations             |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Capital element of finance lease  |      |      (2) |     (4) | 
| rental payments                   |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Net cash generated utilised in    |      |      (2) |     (4) | 
| financing investing activities    |      |          |         | 
+-----------------------------------+------+----------+---------+ 
|                                   |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Decrease in cash and cash         |      |    (354) | (2,886) | 
| equivalents                       |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Cash and cash equivalents at the  |      |    2,421 |   5,307 | 
| start of the period               |      |          |         | 
+-----------------------------------+------+----------+---------+ 
| Cash and cash equivalents at the  |      |    2,067 |   2,421 | 
| end of the period                 |      |          |         | 
+-----------------------------------+------+----------+---------+ 
 
 
Eckoh plc Consolidated Financial Statements for the year ended 31 March 2010 
 
1. Basis of preparation 
The preliminary results of Eckoh plc have been prepared in accordance with the 
recognition and measurement principles of International Financial Reporting 
Standards ("IFRS") in issue as adopted by the European Union and effective at 31 
March 2010.   These statements do not constitute statutory accounts within the 
meaning of section 435 of the Companies Act 2006, but have been derived from 
those accounts.  Statutory accounts for the years ended 31 March 2010 and 31 
March 2009 have been reported on by the Independent Auditors.  The Independent 
Auditors' Report on the Annual Report and Financial Statements for 2009 was 
unqualified, did not draw attention to any matters by way of emphasis, and did 
not contain a statement under 237(2) or 237(3) of the Companies Act 1985.  The 
Independent Auditors' Report on the Annual Report and Financial Statements for 
2010 was unqualified, did not draw attention to any matters by way of emphasis, 
and did not contain a statement under 498(2) or 498(3) of the Companies Act 
2006.  Statutory accounts for the year ended 31 March 2009 have been delivered 
to the Registrar of Companies but those for the year ended 31 March 2010 have 
not yet been delivered. 
 
 2. Categories of financial assets and financial liabilities 
 
+------------------------------------+---------------------------+---------------------------+ 
|                                    |                Loans and receivables                  | 
+------------------------------------+-------------------------------------------------------+ 
|                                    |             31 March 2010 |             31 March 2009 | 
+------------------------------------+---------------------------+---------------------------+ 
| Current financial assets           |                   GBP'000 |                   GBP'000 | 
+------------------------------------+---------------------------+---------------------------+ 
| Trade receivables                  |                     1,217 |                     1,020 | 
+------------------------------------+---------------------------+---------------------------+ 
| Other receivables                  |                        45 |                        27 | 
+------------------------------------+---------------------------+---------------------------+ 
| Loans and receivables              |                         2 |                     1,620 | 
+------------------------------------+---------------------------+---------------------------+ 
| Short-term investments             |                     1,821 |                     2,821 | 
+------------------------------------+---------------------------+---------------------------+ 
| Cash and cash equivalents          |                     2,067 |                     2,421 | 
+------------------------------------+---------------------------+---------------------------+ 
| Total current financial assets     |                     5,152 |                     7,909 | 
+------------------------------------+---------------------------+---------------------------+ 
|                                    |                           |                           | 
+------------------------------------+---------------------------+---------------------------+ 
| Non-current financial assets       |                           |                           | 
+------------------------------------+---------------------------+---------------------------+ 
| Loans and receivables              |                     2,925 |                     1,700 | 
+------------------------------------+---------------------------+---------------------------+ 
| Total non-current financial assets |                     2,925 |                     1,700 | 
+------------------------------------+---------------------------+---------------------------+ 
|                                    |                           |                           | 
+------------------------------------+---------------------------+---------------------------+ 
| Total financial assets             |                     8,077 |                     9,609 | 
+------------------------------------+---------------------------+---------------------------+ 
|                                    |                           |                           | 
+------------------------------------+---------------------------+---------------------------+ 
| Financial liabilities              |                           |                           | 
+------------------------------------+---------------------------+---------------------------+ 
| Trade payables                     |                     (501) |                   (1,980) | 
+------------------------------------+---------------------------+---------------------------+ 
| Other payables                     |                     (302) |                      (27) | 
+------------------------------------+---------------------------+---------------------------+ 
| Obligations under finance lease    |                       (1) |                       (3) | 
+------------------------------------+---------------------------+---------------------------+ 
|                                    |                           |                           | 
+------------------------------------+---------------------------+---------------------------+ 
| Total financial liabilities        |                     (804) |                   (2,010) | 
+------------------------------------+---------------------------+---------------------------+ 
 
 
3. Cash flow from operating activities 
 
+---------------------------------------+----------+----------+ 
|                                       |     2010 |     2009 | 
+---------------------------------------+----------+----------+ 
|                                       |  GBP'000 |  GBP'000 | 
+---------------------------------------+----------+----------+ 
| Cash flows from operating activities  |          |          | 
+---------------------------------------+----------+----------+ 
| Loss after taxation                   |    (118) |    (878) | 
+---------------------------------------+----------+----------+ 
| Loss on disposal of business          |       30 |      129 | 
| operations                            |          |          | 
+---------------------------------------+----------+----------+ 
| Interest income                       |    (398) |    (433) | 
+---------------------------------------+----------+----------+ 
| Interest paid                         |        3 |        - | 
+---------------------------------------+----------+----------+ 
| Taxation recognised in income         |        - |       45 | 
| statement                             |          |          | 
+---------------------------------------+----------+----------+ 
| Depreciation of property, plant and   |      529 |      474 | 
| equipment                             |          |          | 
+---------------------------------------+----------+----------+ 
| Amortisation of intangible assets     |      157 |      121 | 
+---------------------------------------+----------+----------+ 
| Share based payments                  |       44 |       54 | 
+---------------------------------------+----------+----------+ 
| Exchange differences                  |      (8) |     (20) | 
+---------------------------------------+----------+----------+ 
| Operating profit / (loss) before      |      239 |    (508) | 
| changes in working capital and        |          |          | 
| provisions                            |          |          | 
+---------------------------------------+----------+----------+ 
| (Increase) / decrease in inventories  |      (1) |        9 | 
+---------------------------------------+----------+----------+ 
| (Increase) / decrease in trade and    |    (801) |    1,687 | 
| other receivables                     |          |          | 
+---------------------------------------+----------+----------+ 
| Decrease in trade and other payables  |    (657) |  (4,086) | 
+---------------------------------------+----------+----------+ 
| Increase in provisions                |      241 |       62 | 
+---------------------------------------+----------+----------+ 
| Net cash utilised in operating        |    (979) |  (2,836) | 
| activities                            |          |          | 
+---------------------------------------+----------+----------+ 
|                                       |          |          | 
+---------------------------------------+----------+----------+ 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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