DXS International plc Dxs International Plc : Final Results

 
TIDMDXSP 
 
   DXS INTERNATIONAL PLC 
 
   (EPIC: DXSP) 
 
   AUDITED FINAL RESULTS 2016 
 
   The Directors of DXS International plc ("DXS" or the "Company"), the 
ISDX quoted developer and supplier of clinical decision support systems 
to Clinical Commissioning Groups ("CCGs"), GPs, Doctors and healthcare 
professionals are pleased to announce the Company's Final Results for 
the 12 months ending 30th April 2016. 
 
   Financial and Operational Highlights 
 
   The year under review has seen a number of significant achievements: 
 
 
   -- Revenue up by 20% to GBP3.25 million; 
 
   -- Number of CCGs contracted increased to 40; 
 
   -- Debt reduced and healthy cash balance of GBP300,000 at year end; 
 
   -- Three R&D projects have now reached Pilot phase including major 
      development to core product DXS Point of Care; 
 
 
   Commenting on the results Bob Sutcliffe said; 
 
   "The year under report has been challenging, principally as a result of 
changes within the NHS funding regime, but the Company has continued to 
grow revenues and maintained its commitment to continual improvement and 
innovation. The Company is also preparing a major updated version of DXS 
Point of Care, our core product offering, and offering a Personal Care 
Record (PCR), The PCR will enable patients to access and own the 
electronic medical record via an app on their mobile phone or PC." 
 
   Contacts: 
 
   For further information please contact: 
 
 
 
 
David Immelman, CE0 
 DXS International plc 
 www.dxs-systems.co.uk                     01252 719800 
City & Merchant Ltd (Corporate Adviser) 
 David Papworth                           0207 101 7676 
 
 
   About DXS: 
 
   DXS International presents up to date treatment guidelines and 
recommendations, from Clinical Commissioning Groups and other trusted 
NHS sources, to doctors, nurses and pharmacists in their workflow and 
during the patient consultation. This effective clinical decision 
support ultimately translates to improved healthcare outcomes delivered 
more cost effectively which should significantly contribute towards the 
NHS achieving its projected efficiency savings. 
 
   The following information has been extracted from the Company's audited 
accounts for the year to 30th April 2016. The financial reporting 
framework that has been applied in their preparation is applicable law 
and United Kingdom Accounting Standards (United Kingdom Generally 
Accepted Accounting Practice), including Financial Reporting Standard 
102 'The Financial Reporting Standard applicable in the UK and Republic 
of Ireland'. 
 
   The Directors of DXS International plc accept responsibility for this 
announcement. 
 
   CHAIRMAN'S REPORT 
 
   We are pleased to report that the year ending April 2016 has again seen 
a number of significant achievements. 
 
 
   -- Revenue grew by 20% compared with 2015. 
 
 
   -- Three of DXS's R&D projects have now reached Pilot phase. These are the 
      Personal Care Record, the Interactive Patient Care Pathway and the DXS 
      Referral Management solution. 
 
 
   -- New partnerships and collaborations are being formed with providers of 
      additional healthcare functionality. These include the provider of the 
      Personal Care Record, the provider of the Patient Care Pathway, the 
      provider of Medical Devices that integrate into the Personal Care Record, 
      and Kinesis, a solution that enables Consultants to provide virtual 
      opinions on patients on behalf of GPs. 
 
 
   -- DXS Point of Care, our generic solution, delivers considerable ROI for 
      its clients: one study showed a GBP2.7 million reduction in referral 
      costs achieved over a twelve month period. 
 
 
   Revenue grew from GBP2,723,762 at 30 April 2015 to GBP3,255,081 at 30 
April 2016, a year on year increase of 20%. Currently, we have 40 CCG 
clients representing 1250 practices. While CCG numbers have increased, 
practice numbers are declining. This is due to an NHS initiative to 
encourage smaller practices to merge. In addition, our planned growth 
has been hampered by the NHS cutting allocated budgets for GPSoC 
subsidiary solutions and our expectations of future growth from this 
area are therefore reduced. 
 
   To mitigate the NHS budget cuts, DXS is focusing on accessing new 
revenue sources coupled with new and innovative solutions. These are: 
 
 
   -- Personal Care Record - The personal care record enables a patient to 
      enrol via DXS Point of Care in a GP Practice which will provide the 
      patient with full access to their medical records via an app on their 
      mobile device. The system will automatically detect, for example, that a 
      patient is a diabetic and then send the patient reminders for requisite 
      tests such as blood pressure checks, foot health checks etc that become 
      due. This is in line with NHS priorities and a new budget of GBP40 
      million has been made available to CCG's beginning in 2017 to fund a 
      Diabetes initiative. 
 
 
   -- Personal Care Pathway - DXS has been working on this solution for 
      approximately three years. This is a complex algorithmic engine that will 
      assess a patient in relation to a recommended treatment protocol and 
      alert clinicians of actions to implement to ensure treatment compliance. 
 
 
   -- DXS Referral Management solution - This is an enhancement to the existing 
      DXS Point of Care referring functionality. This area is high on the NHS 
      agenda and DXS are about to pilot our new referring workflow solution. As 
      noted above, the existing payback for users is exceptional and the 
      enhancement will reduce unnecessary referrals to an even greater extent. 
 
 
   -- DXS Innovation - This is an initiative where various medical devices are 
      integrated with the Patient's personal care record providing valuable 
      data, such as blood pressure, seamlessly into the patient's personal care 
      record. 
 
 
   -- DXS has during the past year ensured that it meets the required levels of 
      conformance which include customer support, content management, clinical 
      safety and disaster backup and management. 
 
 
   Our cash position remains positive and at the year end, cash at bank 
stood at GBP315,000. 
 
   The audited profit for the year ending 30 April 2016 is GBP219,089 
including the remaining once only write off of GBP54,000 due to a 
management share option issue (see Directors Report for more information 
on this item). 
 
   While NHS cuts have seen the company's revenue growth slowed, to an 
estimated 10% for the year ending April 2017, the Company is actively 
seeking new sources of revenue for continued growth. An example is our 
recent submission of a tender for the LPP (London Partnership Program) 
which should be complete by November 2016. 
 
   I particularly want to thank all DXS staff for their ongoing effort and 
contribution to ensuring that DXS has achieved FRA and in parallel grown 
the revenue by a significant margin. 
 
   Yours sincerely, 
 
   Bob Sutcliffe 
 
   Chairman 
 
   REPORT OF THE DIRECTORS 
 
   The directors present their annual report and the audited financial 
statements for the year ended 30 April 2016. The Chairman's statement 
which is included in this report includes a review of the achievements 
of the Company, the trading performance, financial position and trading 
prospects. 
 
   Directors 
 
   The directors for the year were: 
 
   D Immelman - CEO 
 
   S Bauer - MD 
 
   B Sutcliffe - Chair 
 
   Principal Activities 
 
   The group's principal activities during the period were the development 
and distribution of clinical decision support to General Practitioners, 
Nurses and Retail Pharmacies in the United Kingdom and South Africa. The 
commercial side included the licensing of DXS to various CCG's, the sale 
of e-detailing opportunities to the pharmaceutical industry, the UK 
Primary Care sector and the licensing of DXS technology to healthcare 
publishers. 
 
   Principal Risks 
 
   Failure to achieve predicted quantities of DXS contracts, particularly 
due to NHS budget cuts, and slower development of additional revenue 
streams may result in revenues growing more slowly than anticipated. 
 
   Financial Instruments 
 
   At this stage the Group is not faced with risk relating to interest 
rates on loans, credit and liquidity. 
 
   Dividend 
 
   The Directors do not recommend a dividend. 
 
   Research and Development 
 
   The Company continues to invest into research and development both 
locally and internationally. With the rapid emergence of CCGs in the UK 
healthcare sector and their requirement to achieve billions of pounds of 
savings, the demands of CCG's for DXS to design and create new solutions 
to achieve this is on-going. Each newly developed product represents 
additional potential revenue streams for the Company. 
 
   Directors' Responsibilities 
 
   The directors are responsible for preparing the financial statements for 
each financial year. The directors have elected to prepare the financial 
statements in accordance with United Kingdom Generally Accepted 
Accounting Practice (United Kingdom Accounting Standards and applicable 
law). Under company law the directors must not approve the financial 
statements unless they are satisfied that they give a true and fair view 
of the state of affairs of the company and of the profit or loss of the 
company for that period. In preparing these financial statements, the 
directors are required to: 
 
 
   -- Select suitable accounting policies and apply them consistently. 
 
 
   -- Make judgments and accounting estimates that are reasonable and prudent. 
 
 
   -- State whether UK accounting principles have been followed subject to any 
      material departures  disclosed and explained in the financial statements 
      and, 
 
 
   -- Prepare the financial statements on the going concern basis unless it is 
      inappropriate to presume that the company will continue in the business. 
 
 
   The directors are responsible for keeping proper accounting records that 

are sufficient to show and explain the company's transactions and 
disclose with reasonable accuracy at any time the financial position of 
the company and enable them to ensure that the financial statements 
comply with the Companies Act 2006. They are also responsible for 
safeguarding the assets of the company and hence for taking reasonable 
steps for the prevention and detection of fraud and other 
irregularities. 
 
   The directors have taken all the necessary steps that they ought to have 
taken as directors in order to make themselves aware of all relevant 
audit information and to establish that the company's auditors are aware 
of that information. 
 
   Approved by the board and signed on its behalf by: 
 
   D A Immelman 
 
   Director 
 
   30 September 2016 
 
   STRATEGIC REPORT 
 
   Review of the Company's Business 
 
   The Company has managed to grow revenues from GBP2,723,762 at April 2015 
to GBP3,255,081 in April 2016, a rise of 20%. This was attributed to 
increasing our CCG customers combined with our Pharmaceutical revenue. 
 
   The Company managed a profit of GBP219,089 even after the write off of 
GBP54,000 for a "share option valuation". This charge has been provided 
in terms of current Accounting Standards. 
 
   After significant investment of our limited resources it has been 
frustrating to have the NHS cut budgets for the GPSOC initiative. 
However the company has been seeking alternative revenue streams for its 
offering to the UK healthcare market. 
 
   While the foregoing has resulted in slower than expected revenue growth, 
management are optimistic about new opportunities going forward. 
 
   Description of Principle Risks and Uncertainties 
 
   The principle risk is that a competitor provides the market with a 
superior Clinical Decision Support Solution and takes market share from 
DXS. To mitigate this risk DXS continually meets the dynamic needs of 
its customers through a program of R&D. 
 
   A second risk is that of CCG budgets drying up. 
 
   Analysis of Business during Year Ending April 2016 
 
   Sales growth of 20% was below expectations due to NHS budget cuts. The 
company is also still waiting for GPSOC to provide DXS with access to a 
compliant API which will add in excess of GBP100,000 to our bottom line. 
The reason is that we still are but not meant to be paying Clinical 
Systems royalties for access to patient records. 
 
   The staff headcount, including freelancers, is approximately 80 and this 
is considered sufficient for current requirements. 
 
   During the past year the Company continues to meet its obligations in 
terms of its systems and robustness, dictated by NHS requirements. This 
should continue to offer any customer, whether in the UK or globally, 
the confidence that DXS is able to deliver a high quality of service and 
solution and thus provide complete peace of mind. 
 
   Financial KPI 
 
   Group Revenue GBP3,255,081 an increase of 20%. Definition: Total Group 
sales including distribution of clinical decision support to General 
Practitioners and the licensing of DXS to CCGs and healthcare 
publishers. 
 
   Underlying Group Profit After Tax has declined and this reduction in 
annual profit from the previous year is largely caused by the write off 
of deferred development expenditure included in Administrative Expenses. 
A required write off of GBP54,000 for a management share option 
valuation has also been deducted at arriving at the profit- Definition: 
Underlying profit provides information on the underlying performance of 
the business adjusting for either income or charges which are both one 
off or significant. 
 
   Earnings Per Share 2016 0.7p, 2015 0.9p. Definition: Earnings per share 
is the underlying profit divided by the average number of ordinary 
shares in issue. 
 
   ROCE 2016 13%, 2015 18%. Definition: Return on capital employed (ROCE) 
is the ratio of net operating profit of a company to its capital 
employed. It measures the profitability of a company by expressing its 
operating profit as a percentage of its capital employed. 
 
   Approved by the board and signed on its behalf by: 
 
   D A Immelman 
 
   CONSOLIDATED PROFIT AND LOSS ACCOUNT 
 
   FOR THE YEARED 30 APRIL 2016 
 
 
 
 
                                               2016         2015 
                                                GBP          GBP 
Turnover                                      3,255,081    2,723,762 
 
Cost of sales                                 (517,991)    (461,608) 
 
                                              2,737,090    2,262,154 
 
Administrative expenses                     (2,612,286)  (2,092,782) 
 
Provision for costs of share option 
 awards                                        (54,000)    (108,580) 
 
 
Operating profit/ (loss)                         70,804       60,792 
 
Interest received and similar income              2,403        2,170 
 
 
                                                 73,207       62,962 
 
Interest payable and similar charges           (27,271)     (35,477) 
 
 
Profit on ordinary activities before 
 taxation                                        45,936       27,485 
 
Tax on Profit on ordinary activities            173,153      272,290 
 
 
   Profit for the year                          219,089      299,775 
 
 
Profit per share - 
        - Basic                                     .7p          .9p 
        - fully diluted                             .6p          .7p 
 
 
 
 
   Statement of Other Comprehensive income for the year ended 30 April 2016 
 
 
 
 
                                                      2016     2015 
                                                       GBP      GBP 
 
Profit for the year                                  219,089  299,775 
 
Tax on components of other comprehensive income            -        - 
 
 
Total comprehensive income for the year              219,089  299,775 
 
 
 
   Statement of Financial Position for the Year Ended 30 April 2016 
 
 
 
 
                                           Group         Group      Company    Company 
                                            2016         2015        2016       2015 
                                            GBP           GBP         GBP        GBP 
Fixed Assets 
Intangible assets                          2,111,147    1,868,510          -          - 
Tangible assets                               11,650       22,132          -          - 
Investments                                        -            -  1,310,696  1,077,528 
 
 
                                           2,122,797    1,890,642  1,310,696  1,077,528 
 
 
Current assets 
Debtors: - amounts falling due 
 within one year                           1,592,310    1,153,954     60,948     47,650 
Cash at Bank and in hand                     315,049      480,928     82,517    287,897 
 
 
                                           1,907,359    1,634,882    143,465    335,547 
 
Creditors: amounts falling due 
 within one year                         (1,197,623)  (1,273,960)   (17,856)   (21,778) 
 
 
Net current assets                           709,736      360,922    125,609    313,769 
 
 
Total assets less current liabilities      2,832,533    2,251,564  1,436,305  1,391,297 
 
Creditors: amounts falling due after 
 more than one year                         (94,849)    (242,128)          -          - 
Accruals and Deferred Income             (1,070,844)    (665,081)          -          - 
 
 
                                           1,666,840    1,344,355  1,436,305  1,391,297 
 
 
Capital and reserves 
Called up share capital                      110,174      108,592    110,174    108,592 
Share premium                              1,639,523    1,591,709  1,639,523  1,591,709 
Provision for costs of share option 
 awards                                      162,580      108,580    162,580    108,580 
Retained earnings                          (245,437)    (464,526)  (475,972)  (417,584) 
 
 
Shareholders' funds                        1,666,840    1,344,355  1,436,305  1,391,297 
 
 
 
 
   The financial statements were approved and authorised by the Board on 
 
 
 
 
D Immelman        S Bauer 
 Director          Director 
 
30(th) September  30(th) September 
 
 
   NOTES TO THE FINANCIAL STATEMENTS 
 
   FOR THE YEARED 30 APRIL 2016 
 
   1.     Summary of significant accounting policies 
 
   a)     General information and basis of preparation. 
 
   DXS International PLC is a public company limited by shares incorporated 
in England and Wales. The address of the registered office is given in 
the company information on Page 1 of these financial statements. 
 
   The group's principal activities during the year were the development 
and distribution of clinical decision support to General Practitioners, 
Nurses and Retail Pharmacies in the United Kingdom and South Africa. The 
commercial side includes the licensing of DXS products to various CCGs , 
the sale of e-detailing opportunities to the pharmaceutical industry, 
the UK Primary Care sector and the licencing of DXS technology to 
healthcare publishers. 
 
   The financial statements have been prepared in accordance with 
applicable accounting standards including Financial Reporting Standard 
102 Applicable in the UK and Republic of Ireland (FRS 102) and the 
Companies Act 2006. The financial statements have been prepared on a 
going concern basis under the historical cost convention. The financial 
statements are prepared in sterling which is the functional currency of 
the company. 
 
   The significant accounting policies applied in the preparation of these 
financial statements are set out below. These policies have been 
consistently applied to all years presented unless otherwise stated. The 
company adopted FRS 102 in the current year and an explanation of how 
transition to FRS 102 has affected the reported finance position and 
performance is given in note 25 
 
   b)     Intangible assets 
 
   Intangible assets acquired separately from a business are capitalised at 
cost. 
 

   Research and development expenditure is written off against profits in 
the year in which it is incurred. Identifiable development expenditure 
is capitalised to the extent that the technical, commercial and 
financial feasibility can be demonstrated. 
 
   Goodwill arising on business combinations is capitalised, classed as an 
asset on the balance sheet and amortised over its useful life. The 
period chosen for writing off goodwill is 20 years. The reason for 
choosing this period is because the directors believe that this is the 
period of time for the benefit to be received. 
 
   Intangible assets are amortised over a straight line basis over their 
useful lives. The useful lives of intangible assets are as follows: 
 
 
 
 
Intangible    Useful life                                         Reasons 
type 
Development   5 years from the date that the specific product is  Period of 
expenditure    completed and available for distribution           time for 
                                                                  benefit to 
                                                                  be received 
Goodwill      20 years from acquisition of goodwill               Period of 
                                                                  time for 
                                                                  benefit to 
                                                                  be received 
 
 
   c)     Tangible fixed assets 
 
   Tangible fixed assets are stated at cost less accumulated depreciation. 
 
   Depreciation is provided on all tangible fixed assets at rates 
calculated to write off the cost, less estimated residual value, of each 
asset on a systematic basis over its expected useful life as follows: 
 
   Plant and equipment      3-4 years straight line 
 
   d)     Debtors and creditors receivable/ payable within one year 
 
   Debtors and creditors with no stated interest rate and receivable or 
payable within one year are recorded at transaction price. Any losses 
arising from impairment are recognised in the profit and loss account in 
other administration expenses 
 
   e)     Loans and borrowings 
 
   Loans and borrowings are initially recognised at the transaction price 
including transaction costs. Subsequently they are measured at amortised 
cost using an effective interest rate method, less impairment. If an 
arrangement constitutes a finance transaction it is measured at present 
value. 
 
   f)     Provisions 
 
   Provisions are recognised when the company has an obligation at the 
balance sheet date as a result of a past event. It is probable that an 
outflow of economic benefit will be required in settlement and the 
amount can be reliably estimated. 
 
   g)     Tax 
 
   Current tax represents the amount of tax payable or receivable in 
respect of the taxable profit for the current or past reporting periods. 
It is measured at the amount expected to be paid or recovered using the 
tax rates and laws that have been enacted or substantively enacted by 
the balance sheet date. 
 
   h)     Turnover and other income 
 
   Turnover is measured at the fair value of the consideration received or 
receivable net of VAT and trade discounts. The policy adopted for the 
recognition of turnover is as follows: 
 
   i)     Foreign currency 
 
   Foreign currency transactions are initially recognised by applying to 
the foreign currency amount the exchange rate between the functional 
currency and the foreign currency at the date of the transaction. 
 
   Monetary assets and liabilities denominated in a foreign currency at the 
balance sheet date are translated using the closing rate. 
 
   The company's principal activities during the year were the development 
and distribution of clinical decision support to General Practitioners, 
Nurses and Retail Pharmacies in the United Kingdom and South Africa. The 
commercial side includes the licensing of DXS products to various CCGs, 
the sale of e-detailing opportunities to the pharmaceutical industry, 
the UK Primary Care sector and the licencing of DXS technology to 
healthcare publishers. 
 
   j)     Employee benefits 
 
   When employees have rendered service to the company, short term employee 
benefits to which the employees are entitled are recognised at the 
undiscounted amount expected to be paid in exchange for that service. 
 
   The company operates a defined contribution plan for the benefit of its 
employees. Contributions are expensed as they become payable. 
 
   FRS 102 requires that a provision for holiday pay is provided in the 
annual accounts.  This provision, not previously made, was included as 
an adjustment in the 2015 accounts as provided in terms of the 
transitional rules of FRS 102. 
 
   k)     Leases 
 
   Rentals payable and receivable under operating leases are charged to the 
profit and loss account on a straight line basis over the period of the 
lease 
 
   This announcement is distributed by Nasdaq Corporate Solutions on behalf 
of Nasdaq Corporate Solutions clients. 
 
   The issuer of this announcement warrants that they are solely 
responsible for the content, accuracy and originality of the information 
contained therein. 
 
   Source: DXS International plc via Globenewswire 
 
 
  http://www.dxs-systems.com/ 
 

(END) Dow Jones Newswires

October 03, 2016 01:30 ET (05:30 GMT)

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