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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| AT Commun. | LSE:ATCG | London | Ordinary Share | GB00B0C8K346 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.875 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number : 9957C
AT Communications Group Plc
09 September 2008
ATCG.L
AT Communications Group plc
AT Communications Group plc ("ATC", AIM: ATCG), one of the UK's leading business communications groups, today publishes its interim
results for the six months ended 30 June 2008.
Financial Highlights:
· Robust performance despite a more challenging business environment
· Turnover up 10% to £46.8m (2007 H1: £42.7m)
· Gross profit up 11% to £18.4m (2007 H1: £16.5m)
· Underlying operating profit increased by 9% to £3.4m (2007 H1: £3.1m)*
· Underlying pre-tax profits for the six months increased by 6% to £2.5m*
· Underlying diluted EPS decreased to 2.8p (2007: 3.3p) due to share placing in August 2007
· Strong cash generation and business performance in second half expected to reduce full year net debt significantly
* before amortisation of intangibles, restructuring and non-recurring costs, share based payments and start up costs of new income
streams.
Operational Highlights:
· £1.9m investment made in core business to underpin future growth, generating £45m pipeline and prospect bank
· Existing banking facilities provide flexibility to support investment and long term strategy to deliver shareholder value
· £0.5m of capex to improve IT systems infrastructure within the Group
· Contract wins including Avaya, Ericsson, De La Rue, Amazon and OGC Buying Solutions
· Long term prospects remain very encouraging
Alex Tupman, ATC's CEO commented:-
"This is our first set of results for which we have reported like-for-like comparisons without adjusting for acquisitions and I am
pleased to report a period of double digit organic revenue growth across the Group despite a challenging business environment.
We have made necessary investments during the period to support long term growth that have generated a substantial pipeline of business.
Although as a consequence net debt has increased over the short term, it is being aggressively managed to ensure that the resulting
profitability of the new business wins generated by the investments deliver net debt reduction.
Blue chip client wins during the period are testimony to our success at servicing high value, global business and with the necessary
investment now in place, we have the scale and infrastructure to support our growth momentum. I look forward to reporting further progress
in due course."
For more information:
AT Communications Group plc 08700 55 80 80
Alex Tupman, Chief Executive
Cenkos Securities plc 020 7397 8924
Stephen Keys
Biddicks 020 7448 1000
Shane Dolan
www.atcommunications.co.uk
Chief Executive's Report
Overview
This is the first time since our maiden results that the Group has reported like-for-like sales growth without adjusting for
acquisitions and I am pleased to report another period of double digit organic revenue growth across the Group in increasingly challenging
economic conditions.
These results have been achieved through necessary investments in growth areas of our business that have generated an additional
pipeline and prospect bank of almost £45m, which we believe will underpin the financial performance in second half of this year, 2009 and
beyond. We predict a robust second half performance with strong cash generation leading to a significant reduction in overall net debt for
the full year. This investment strategy has provided the Group with the opportunity to build the business for the long term benefit of
shareholders and is also supported by our new banking arrangements with HBoS, announced in January.
The results for the six months to 30 June 2008 demonstrate continued organic growth with turnover increasing by 10% to £46.8m and
underlying operating profit increasing by 9% to £3.4m. Gross margins have remained stable at 39% reflecting the strong fundamentals of our
business and the development and concentration on higher margin, service-related revenues where considerable investment has been made during
the period. In particular, we have invested £1.9m in our Servassure division, which is now also developing external new business in addition
to our successful and continually growing BT relationship. These new customers include alternative carriers, systems integrators, large
Resellers and hosted providers. Servassure revenues are now split three ways; "In Group", "BT" and "UK Channels" where UK Channels, a new
revenue stream for the Group, has contributed over £1m of gross margin in H1 and has a pipeline and prospect bank for H2 and into 2009 of
£25m of revenue. In addition, further investments in our BT team have resulted in significant growth in revenues to BT and a prospect bank totalling £20m of revenue.
Many of our activities with current and potential customers are focused on helping them reduce their OPEX costs. This has been achieved
by offering bundled services with single point of contact, multiple suppliers consolidation and a unique per seat pricing model that
combines cost savings with new technology.
Our Rocom division continues to grow its market share. In particular, its Network Services revenues have more than doubled during the
period and will benefit further from the significant contract win with Cable & Wireless for £5m of additional Reseller business, announced
in July. Overall, contracted and recurring revenues now represent 70% of Group revenues.
Operating Results
In the six months to 30 June 2008 Group revenue grew by 10% to £46.8m (H1 2007: £42.7m).
The split between operating divisions including "inter-divisional sales" is as follows: Rocom £21.0m (H1 2007: 20.6m), ATC Solutions
£20.7m (H1 2007: £19.4m) Servassure £10.5m (H1 2007: £8.4m) and Inter-divisional sales were £5.4m (H1 2007: £5.6m).
Each division has achieved growth in both turnover and underlying operating profit as shown in the table below:
6 months to 30 June 2008 Rocom ATC Solutions Servassure Group & eliminations Consolidated
£'000 £'000 £'000 £'000 £'000
Turnover 20,975 20,695 10,548 (5,399) 46,819
Underlying operating profit 973 1,742 1,102 (467) 3,350
6 months to 30 June 2007
Turnover 20,587 19,383 8,360 (5,600) 42,730
Underlying operating profit 850 1,560 818 (163) 3,065
Growth
Turnover 2% 7% 26% (4%) 10%
Underlying operating profit 14% 12% 35% N/A 9%
Underlying operating profit grew by 9% to £3.4m (H1 2007: £3.1m). This is calculated as profit before tax and interest, adjusted for
amortisation of intangibles £0.6m, restructuring and non-recurring costs of £0.2m, charge for share based payments of £0.2m and the net
costs of developing new Servassure income streams of £0.9m.
Underlying pre-tax profit grew by 6% to £2.5m (see table below). This growth was impacted by higher interest charges required to fund
the increase in working capital. The interest charge increased from £0.7m (H1: 2007) to £0.8m (H1: 2008).
6 months to 30 June 6 months to 30 June 2007 Year to 31 Dec 2007
2008 Unaudited Audited
Unaudited
£'000s £'000s £'000s
Profit before tax 541 1,097 2,752
Share based payments 243 75 284
Amortisation of intangibles 648 648 1,296
Non-recurring and 161 500 1,892
restructuring costs
Net investment in Servassure 874 - -
business
Underlying profit before tax 2,467 2,320 6,224
The £60k tax credit shown in the accounts (2007 H1: £279k) is due primarily to the unwinding of the deferred tax on the fair value
adjustments arising on previous acquisitions.
Underlying, diluted EPS was 2.8p compared to 3.3p in H1: 2007. This is due to an increase in the number of shares from the share placing
in August 2007.
The balance sheet showed net assets of £27.4m as at 30 June (2007 H1: £21.1m). Working capital has increased to £17.3m for the period,
up from £9.7m at 31 December 2007 and £7.3m at 30 June 2007. The key drivers to this are:
· Business growth in the new Servassure *UK Channels*
· Increasing activity with BT
· Higher stock in Rocom reflecting wider product portfolio
These higher working capital requirements, which we see reducing considerably in the second half of 2008, have led to an increase in net
debt to £22.2m (2007 H1: £19.5m).
Review of Activities (by division)
Servassure
Servassure continues to offer 'white label' engineering, installation, maintenance and professional services both "in Group" and to
external customers. Business with external customers is now split into two main areas: "BT" and "UK Channels".
Servassure has benefited from significant investment of £1.9m during the period in both the BT team and UK Channels. This investment has
lead to a pipeline of new business opportunities totalling £45m, including several significant government and blue chip contracts via
leading carriers. These contracts involve supplier consolidation activities, as well as other high value projects such as a centralised
operator function for the Ministry of Justice, a single point of contact for 100,000 users throughout Europe and Asia, and a
multi-functional contract for a major government department.
Following a positive launch of our UK Channels division our activity during the period has been focused on customer acquisition,
including, among others, Verizon, Thus, Kingston, Damovo, Siemens, IBM, Telent and Samsung. Securing these high profile new customers has
generated a significant pipeline of new business for the second half year. Our focus going forward is to optimise these new relationships,
demonstrate our capability and build sustainable partnerships that will continue to develop and grow into 2009 and beyond.
Many of these prospects now include the installation and maintenance of Data technologies, including Cisco and Juniper where we have
invested in developing specific skill sets during the period.
Servassure revenues are of a contract nature, in line with our declared focus on long-term revenue streams. During the period under
review, Servassure enjoyed a 26% increase in revenue growth compared to the same period last year. We predict that this positive trend will
continue following our investment in this high growth area of our business.
Many of Servassure's activities are focused on reducing costs by consolidating suppliers to a single vendor. This is an attractive
proposition for both small and large UK and global carriers. Specifically, our single point of contact capability is attracting attention
with current and potential customers by helping to reduce their OPEX costs. Many customers are also looking to extend the life cycle of
their telephony infrastructure to reduce their costs which, in turn, extends our service and maintenance delivery revenue earning
opportunities.
ATC Solutions
During the period, ATC Solutions division continued to evolve its leading-edge strategy in order to underpin the clarity and focus of
our customer activity, sales structure and core capabilities.
This strategy has begun to pay off with the formation of a vertical sales focus. In particular, significant success has been achieved in
the Health sector where we have developed a finely tuned understanding of the specific needs of this vertical market. Significant contract
wins included OGC Buying Solutions, announced in February, an 8000 extension IP Telephony roll out for Gloucestershire and Bristol Primary
Care Trusts and a resilient IP Telephony solution for a 999 call centre with East Midlands Ambulance Service.
In March, we were delighted to announce the signing of a landmark three year contract with De La Rue, the world's largest commercial
security printer. We have now begun the roll-out of IP technology across De La Rue's global business units.
Other contract wins included, among others, a contract for the supply of various telephony products to West Midlands Police, the second
largest police force in the UK and a maintenance contract with Staples, the world's largest office products company, supporting telephony
infrastructure throughout 140 stores.
Our audit and consulting services together with our ability to bundle multiple services is also allowing us to take full advantage of
customers looking to control and reduce OPEX costs in the current economic downturn. In addition, we have recently launched a unique
per-seat pricing model with options based on cost saving, efficiency saving or technology refresh under a long term managed service
contract. This new model has been trialled with 30 customers, all of whom have taken up either a three or five year contract.
Rocom
During the period Rocom has continued to focus exclusively on sales to the indirect channel, including Dealers and Voice and Data
Resellers as well as high street retail chains such as PC World and the online e-tail community such as Amazon.
Optimising its unique 10 pillar "Total Distribution proposition", Rocom strategic aims are: to increase market share, expand the ratio
of active buying accounts, grow average order value and customer wallet share, as well as continuing to develop the product portfolio.
This focus is paying off as evidenced by a number of significant contract wins during the period. These wins included the securing of a
multi-million pound distribution account with Avaya and the establishing of Rocom as the UK's sole Distribution for Aastra's system
portfolio (previously Ericsson), announced in May 2008. These encouraging wins continue the positive trend established in 2007 when Rocom
had a record year including significant contract wins with Siemens and Amazon, collectively valued at over £6m.
Notwithstanding the challenges of the UK and global economy, Rocom continues to demonstrate its potential and competitive advantage.
Post period end, Rocom created the "Siemens Reseller Advisory Council" securing the leading Siemens Resellers, a channel first and another
multi-million revenue line. In addition, Rocom was further mandated as supplier to The Concert Group, a leading consortium of 12 resellers.
These wins, among many others, resulted in Rocom being awarded the channel's highly prized 'Distributor of the Year' award in June 2008,
which reinforces Rocom's ability to meet its 2008 target.
Looking forward, Rocom will continue its development as a leading Converged Distributor having recently agreed distribution arrangements
for a Data portfolio with Enterysis and Extreme.
Management
The board has been strengthened during the period with the appointment of Fred Hallsworth, CA, non-executive director, announced in
February. Fred was previously, Senior Client Service Partner and Head of Technology, Media and Communications for Deloitte, Scotland. He
brings with him over 30 years' experience of assisting companies with fundraising, mergers and acquisitions, IPO's and associated
transactions. Fred has recently been appointed Chairman of the Group's Audit Committee.
In July, the board was restructured to combine the Commercial Director and Finance Director roles. Andrew Parsliffe, FCA who was
previously Commercial Director of the Group with significant FTSE financial and commercial experience, also took over the role of Group
Finance Director from Ian Crawley to facilitate Ian's pursuit of other interests. The board would once again wish to thank Ian for his
contribution to the Group.
Current trading and outlook
The Group is currently trading in line with the board's expectations and the pipeline and prospect bank have never looked healthier. Our
Rocom and Servassure divisions are winning market share, delivering unique ways of procuring new technology and bundling existing services
in our ATC Solutions division to combat a declining economy. Having made necessary investments to secure the long term future of our
business, we are now aggressively addressing our debt to achieve the board's target of a significant reduction over the second half year.
The board is confident of a strong second half performance of profitability and cash generation.
Finally, I would like to take this opportunity to thank our staff for their dedication and excellent work to date and look forward to
updating shareholders with further progress in due course.
Alex Tupman, Chief Executive, 9 September 2008
Consolidated interim income statement
6 months to 30 June 6 months to 30 June 2007 Year to 31 Dec 2007
2008 Unaudited Audited
Unaudited
Note £'000s £'000s £'000s
Continuing operations
Revenue 46,819 42,730 88,434
Cost of sales (28,452) (26,246) (52,773)
________ ________ ________
Gross profit 18,367 16,484 35,661
Administrative costs (16,943) (14,642) (31,443)
________ ________ ________
Operating profit 3 1,424 1,842 4,218
Interest received - - 20
Finance costs (883) (745) (1,486)
________ ________ ________
Profit before tax 541 1,097 2,752
Income taxes 4 60 279 (362)
________ ________ ________
Profit for the period 601 1,376 2,390
______ ______ ______
Earnings per share:
Basic earnings per share 8 0.8p 2.2p 3.5p
______ ______ ______
Diluted earnings per share 8 0.8p 2.1p 3.5p
______ ______ ______
______ ______ ______
Diluted adjusted earnings per 8 2.8p 3.3p 7.5p
share
______ ______ ______
Consolidated interim balance sheet
6 months to 30 June 6 months to 30 June Year to 31 Dec 2007
2008 2007 Restated Audited
Unaudited Unaudited
Note £'000s £'000s £'000s
ASSETS
Non-current assets
Property, plant and equipment 1,291 1,088 1,153
Goodwill 6 27,182 27,182 27,182
Other intangible assets 6 6,382 7,678 7,030
Deferred tax assets 525 1,195 525
________ ________ ________
35,380 37,143 35,890
________ ________ ________
Current assets
Inventories 7 10,980 9,495 9,401
Trade and other receivables 26,100 19,177 23,390
Cash and cash equivalents 10 657 2,219 2,922
Derivative financial 4 - 27
instruments
________ ________ ________
37,741 30,891 35,740
________ ________ ________
Total assets 73,121 68,034 71,630
______ ______ ______
LIABILITIES
Current liabilities
Trade and other payables 19,805 21,414 23,057
Short-term borrowings 10 9,960 8,505 6,508
Current tax payable 1,102 884 1,228
Obligations under finance 42 70 41
leases
________ ________ ________
30,909 30,873 30,834
________ ________ ________
Non-current liabilities
Long-term borrowings 10 12,938 13,109 11,370
Deferred income tax liability 1,914 2,875 2,109
Obligations under finance - 45 7
leases
________ ________ ________
14,852 16,029 13,486
________ ________ ________
Total liabilities 45,761 46,902 44,320
________ ________ ________
________ ________ ________
Total net assets 27,360 21,132 27,310
______ ______ ______
EQUITY
Equity attributable to equity
holders of the parent
Share capital 5 771 662 771
Share premium account 5 21,771 16,967 21,771
Capital redemption reserve 6 6 6
Hedging reserve 4 - 27
Profit and loss account 4,808 3,497 4,735
________ ________ ________
Total equity 27,360 21,132 27,310
______ ______ ______
Consolidated interim statement of changes in equity
Sharecapital Sharepremiumaccount Capitalredemptionres Hedgingreserve Retained earnings
Totalequity
erve
Note £'000s £'000s £'000s £'000s £'000s
£'000s
Balance at 1 January 2007 609 15,123 6 - 2,723
18,461
Profit for the period - - - - 1,376
1,376
Share based payments - - - - 60
60
--------------- ------------------- -------------------- ------------------- ------------------
----------------
-
Total recognised income and 609 15,123 6 - 4,159
19,897
expense
Dividends - - - - (662)
(662)
Issue of share capital 53 1,908 - - -
1,961
Cost of shares issued - (64) - - -
(64)
--------------- ------------------- -------------------- ------------------- ------------------
----------------
----
Balance at 30 June 2007 662 16,967 6 - 3,497
21,132
======= ========== ============ ========== =========
========
Balance at 1 July 2007 662 16,967 6 - 3,497
21,132
Profit for the period - - - - 1,014
1,014
Share based payments - - - - 224
224
Gain on interest rate hedges - - - 27 -
27
--------------- ------------------- -------------------- ------------------- ------------------
----------------
-----
Total recognised income and 662 16,967 6 27 4,735
22,397
expense
Issue of share capital 5 109 5,001 - - -
5,110
Cost of shares issued - (197) - - -
(197)
--------------- ------------------- -------------------- ------------------- ------------------
----------------
-----
Balance at 31 December 2007 771 21,771 6 27 4,735
27,310
======= ========= ============ ========= =========
========
Balance at 1 January 2008 771 21,771 6 27 4,735
27,310
Profit for the period - - - - 601
601
Share based payments - - - - 243
243
Movement on interest rate - - - (23) -
(23)
hedges
--------------- ------------------- -------------------- ------------------- ------------------
----------------
-----
Total recognised income and 771 21,771 6 4 5,579
28,131
expense
Dividends 9 - - - - (771)
(771)
Issue of share capital 5 - - - - -
-
Cost of shares issued - - - - -
-
--------------- ------------------- -------------------- ------------------- ------------------
----------------
-----
Balance at 30 June 2008 771 21,771 6 4 4,808
27,360
======= ========== ============ ========== =========
========
Consolidated interim cash flow statements
6 months to 30 6 months to 30 Year to 31
June 2008 June 2007 Restated December 2007
Unaudited Unaudited Audited
Note £'000s £'000s £'000s
Cash flows from operating
activities
Profit before taxation 541 1,097 2,752
Adjustments for:
Depreciation 358 289 628
Amortisation of intangible 648 648 1,296
assets
Investment revenue - - (20)
Interest expense 883 745 1,486
Share based payments 243 75 284
(Increase) in inventories (1,578) (2,213) (2,119)
(Increase) in trade and other (2,710) (909) (5,504)
receivables
(Decrease) in trade & other (3,210) (4,938) (2,633)
payables
-------------------- -------------------- --------------------
----- ----- -----
Cash used in operations (4,825) (5,206) (3,830)
Interest paid (883) (745) (1,486)
Income taxes paid (261) (301) (471)
-------------------- -------------------- --------------------
----- ----- -----
Net cash (used in) operating (5,969) (6,252) (5,787)
activities
-------------------- -------------------- --------------------
----- ----- -----
Cash flows from investing
activities
Interest received - - 20
Purchase of property, plant (496) (149) (574)
and equipment
Proceeds of property held for - 3,500 3,500
resale
Proceeds from sale of - 4 25
equipment
Acquisition of subsidiary - - (207)
-------------------- -------------------- --------------------
----- ----- -----
Net cash used in investing (496) 3,355 2,764
activities
-------------------- -------------------- --------------------
----- ----- -----
Cash flows from financing
activities
Proceeds from issue of shares - 1,897 6,809
5
Dividends paid (771) (662) (662)
New loans 20,981 5,214 458
Repayment of long-term (19,466) (9,548) (6,680)
borrowings
Payment of finance lease (5) (51) (135)
liabilities
-------------------- -------------------- --------------------
----- ----- -----
Net cash from financing 739 (3,150) (210)
activities
-------------------- -------------------- --------------------
----- ----- -----
Net decrease in cash and cash (5,726) (6,047) (3,233)
equivalents
Cash / (overdrafts) and cash (277) 2,956 2,956
equivalents at beginning of
period
-------------------- -------------------- --------------------
----- ----- -----
Overdrafts and cash (6,003) (3,091) (277)
equivalents at end of period
==================== ==================== ====================
===== ===== =====
Notes to the consolidated interim financial statements
1 Nature of operations and general information
The AT Communications Group plc ("ATC") is one of the UK's leading business communications groups. The Group is focused on delivering a
complete suite of IP-centric solutions and services to meet the requirements of the 21st century enterprise. We operate in three divisions
to allow us to address the needs of organisations of all sizes through the most cost-effective route to market.
The Group was established in 1999 by current Chief Executive, Alex Tupman, and has subsequently grown significantly both organically and
through acquisition. Our growth strategy is designed to leverage advances in next-generation communications in a consolidating marketplace.
We have been at the forefront of both the IP technology revolution and the consolidation in the UK market - by anticipating changes to the
landscape, ATC will continue to be a leading light in the ICT sector.
ATC is the Group's ultimate parent company. It is incorporated and domiciled in Great Britain. The address of AT Communications Group
plc's registered office, which is also its principal place of business, is Greenway House, Pinnacles, Harlow, Essex, CM19 5QD. AT
Communications Group plc's shares are listed on the AIM Market ('AIM') of the London Stock Exchange.
The consolidated interim financial statements of ATC are presented in Pounds Sterling, which is also the functional currency of the
Group.
2 Significant Accounting Policies
Basis of accounting
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as
adopted for use in the European Union. The financial statements have been prepared on the historical cost basis, except for the revaluation
of certain financial instruments and follow the same format as the audited accounts for the year ended 31st December 2007.
3 Business Segments
For management purposes, the Group is currently organised into three operating divisions - Rocom, ATC Solutions and Servassure. These
divisions are the basis on which the Group reports its primary segment information. Each division is engaged in the supply of
telecommunication products, services and solutions to the business market and the distinguishing feature of each division is the customer
segment that it addresses. The Group's operations are all located in the UK and sales are almost exclusively to UK customers and therefore
in the opinion of the directors there is only one geographic segment. On this basis no secondary segmental analysis is deemed appropriate.
Segment information about these businesses is presented below.
6 months to 30 June 2008 Rocom ATC Solutions Servassure Group & eliminations
Consolidated
£'000 £'000 £'000 £'000 £'000
Revenue
External sales 19,343 20,695 6,781 - 46,819
Inter-divisional sales 1,632 - 3,767 (5,399) -
Total revenue 20,975 20,695 10,548 (5,399) 46,819
Operating profit 919 1,707 219 (1,421) 1,424
Share based payments 54 4 9 176 243
Amortisation of intangibles - - - 648 648
Non-recurring and - 31 - 130 161
restructuring costs
Net investment in the 874* 874
Servassure business
(Headcount) Additional costs
less income generated in H1
2008
Underlying operating profit 973 1,742 1,102 (467) 3,350
Depreciation 142 95 121 - 358
Underlying EBITDA 1,115 1,837 1,223 (467) 3,708
Finance costs - net (883)
Profit before income tax 541
Income tax credit 60
Profit for the period 601
*The net investment in Servassure has been excluded to give like-for-like comparability of operating profits between the three periods.
This measure is only included to give the reader a clearer understanding of the performance of the Servassure division in H1 2008 and is not
regarded as a 'non-recurring' or 'restructuring' in nature and therefore will not be treated in this fashion at the year-end.
Inter-segment sales are charged at prevailing market prices. Segmental results are shown before Group management charges have been
applied.
Year to 31 December 2007 Rocom ATC Solutions Servassure Group & eliminations
Consolidated
£'000 £'000 £'000 £'000 £'000
Revenue
External sales 36,358 41,354 10,722 - 88,434
Inter-divisional sales 5,142 - 7,785 (12,927) -
Total revenue 41,500 41,354 18,507 (12,927) 88,434
Operating profit 2,626 4,120 2,933 (5,461) 4,218
Share based payments 33 22 22 207 284
Amortisation of intangibles - - - 1,296 1,296
Non-recurring and - 86 128 1,678 1,892
restructuring costs
Underlying operating profit 2,659 4,228 3,083 (2,280) 7,690
Depreciation 252 248 224 (96) 628
Underlying EBITDA 2,911 4,476 3,307 (2,376) 8,318
Finance costs - net (1,466)
Profit before income tax 2,752
Income tax expense (362)
Profit for the year 2,390
Inter-segment sales are charged at prevailing market prices. Segmental results are shown before Group management charges have been
applied.
6 months to 30 June 2007 Rocom ATC Solutions Servassure Group & eliminations
Consolidated
£'000 £'000 £'000 £'000 £'000
Revenue
External sales 19,174 19,383 4,173 - 42,730
Inter-divisional sales 1,413 - 4,187 (5,600) -
Total revenue 20,587 19,383 8,360 (5,600) 42,730
Operating profit 850 1,560 818 (1,386) 1,842
Share based payments 75 75
Amortisation of intangibles - - - 648 648
Non-recurring and - 500 500
restructuring costs
Underlying operating profit 850 1,560 818 (163) 3,065
Depreciation 148 53 90 291
Underlying EBITDA 998 1,613 908 (163) 3,356
Finance costs - net (745)
Profit before income tax 1,097
Income tax credit 279
Profit for the period 1,376
Inter-segment sales are charged at prevailing market prices. Segmental results are shown before Group management charges have been
applied.
4 Income Tax
The taxation charge has been estimated has been estimated at 30% (2007: 30%).
6 months 6 months to 30 June 2007
to 30 June
2008
£000's £000's
Estimated tax charge at 30% 135 329
Deferred tax - reversal of (195) (608)
temporary difference
Period credit (60) (279)
=================== ==================
5 Share issue
During the period to 30 June 2008 no shares were issued in a share placement arrangement. Shares issued and authorised for the period to
30 June 2008 are summarised as follows:
6 months to 30 June 2008
Number £
At 1 January 2008 77,141,356 22,540,013
Issue of shares net of costs - -
________ ________
At 30 June 2008 77,141,356 22,540,013
============== =============
6 months to 30 June 2007
Number £
At 1 January 2007 60,908,464 15,732,497
Issue of shares net of costs 5,300,000 1,897,002
________ ________
At 30 June 2007 66,208,464 17,629,499
=============== =============
Year to 31 December 2007
Number £
At 1 January 2007 60,908,464 15,732,497
Issue of shares net of costs 15,938,298 6,698,516
Exercise of warrants 294,594 109,000
________ ________
At 31 December 2007 77,141,356 22,540,013
============== ==============
6 Additions and disposals of intangible assets
The following tables show the significant additions and disposals to intangible assets.
Trade Customer lists Intangibles
name total Goodwill
£'000s £'000s £'000s £'000s
Carrying amount at 1,971 5,059 27,182
1 January 2008 7,030
Amortisation (94) (554) (648) -
-------------------- -------------------- -------------------- -------------------------
----- ----- -----
Carrying amount at 1,877 4,505
30 June 2008 6,382 27,182
================= ================ =============== ==================
Trade Customer lists Intangibles
name total Goodwill
£'000s £'000s £'000s £'000s
Carrying amount at 2,160 6,166 8,326 26,975
1 January 2007
Adjustment in respect of 2006 - - - 207
acquisitions
Amortisation (94) (554) (648) -
-------------------- -------------------- ---------------------- -------------------------
----- ----- ---
Carrying amount at 2,066 5,612
30 June 2007 7,678 27,182
================= ================ =============== =================
Trade Customer lists Intangibles
name total Goodwill
£'000s £'000s £'000s £'000s
Carrying amount at 2,160 6,166 8,326 26,975
1 January 2007
Adjustment in respect of 2006 - - - 207
acquisitions
Amortisation (189) (1,107) (1,296) -
-------------------- -------------------- ---------------------- -------------------------
----- ----- ---
Carrying amount at 1,971 5,059
31 December 2007 7,030 27,182
================= ================ =============== =================
7 Inventories
6 months to 30 June 6 months to 30 June 2007 Year to 31 Dec 2007
2008 Unaudited Audited
Unaudited
£'000s £'000s £'000s
Maintenance stock 4,070 3,885 3,967
Stock held for re-sale 4,938 4,405 4,250
Work-in-progress 1,972 1,205 1,184
________ ________ ________
10,980 9,495 9,401
========== ========== ===========
8 Earnings per share
The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted
average number of shares in issue during the year. Shares held in employee share trusts are treated as cancelled for the purposes of this
calculation.
The calculation of diluted earnings per share is based on the basic earnings per share, adjusted to allow for the issue of shares and
the post tax effect of dividends and/or interest, on the assumed conversion of all dilutive options and other dilutive potential ordinary
shares.
Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below:
6 months to 30 June 6 months to 30 June Year to 31 Dec 2007
2008 2007 Audited
Unaudited Unaudited
Earnings £'000s £'000s £'000s
Earnings for the purposes of 601 1,376 2,390
basic earnings per share being
net profit attributable to
equity holders of the parent
Effect of dilutive potential - - -
ordinary shares:
Earnings for the purposes of 601 1,376 2,390
diluted earnings per share
Operating profit (Note 3) 1,424 1,842 4,218
Amortisation of intangible 648 648 1,296
assets
Non -recurring expenses 161 500 1,892
Net investment in Servassure 874 - -
operations
Underlying profit before 3,107 2,990 7,406
income tax
Less: Underlying income tax (932) (897) (2,222)
expense
Earnings for the purposes of 2,175 2,093 5,184
diluted adjusted earnings per
share
Number of shares
Weighted average number of 77,141,356 63,455,978 69,231,218
ordinary shares for the
purposes of basic earnings per
share
Effect of dilutive potential
ordinary shares:
Share options - 607,785 27,898
Weighted average number of 77,141,356 64,063,763 69,259,116
ordinary shares for the
purposes of diluted earnings
per share
Earnings per share £ £ £
Basic 0.8p 2.2p 3.5p
Diluted 0.8p 2.1p 3.5p
Diluted adjusted* 2.8p 3.3p 7.5p
* Diluted adjusted EPS is calculated after adding back amortisation, non-recurring expenses and the net investment in the Servassure
business (adjusted for tax at an underlying rate of 30%).
9 Dividends
AT Communications Group plc will make an aggregate dividend payment of £771,413 to its equity shareholders on 16th September 2008. This
represents a payment of £0.01 pence per share.
10 Net debt
6 months to 30 June 6 months to 30 June 2007 Year to 31 Dec 2007
2008 Unaudited Audited
Unaudited
£'000s £'000s £'000s
Bank overdrafts 6,660 5,310 3,199
Bank loans 16,498 16,493 14,615
Issue costs (565) (287) (382)
Other loans 305 - 381
Loan notes (issued for - 98 65
Britannia acquisition)
22,898 21,614 17,878
The borrowings are repayable
as follows:
On demand or within one year 9,960 8,505 6,508
In the second year 12,938 13,109 11,370
22,898 21,614 17,878
Cash and cash equivalents 657 2,219 2,922
________ ________ ________
657 2,219 2,922
Net debt 22,241 19,476 14,956
This information is provided by RNS
The company news service from the London Stock Exchange
END
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