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SEV Servision

0.85
0.00 (0.00%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Servision LSE:SEV London Ordinary Share GB00B0586C20 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% 0.85 0.70 1.00 0.00 00:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
0 0 N/A 0

SerVision plc Half Yearly Report (7651A)

30/09/2015 1:42pm

UK Regulatory


Servision (LSE:SEV)
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RNS Number : 7651A

SerVision plc

30 September 2015

30 September 2015

SerVision PLC

("SerVision" or the "Company")

Interim Results

For the Six Months Ended 30 June 2015

The Board of SerVision (AIM: SEV), the AIM quoted leading developer and manufacturer of digital security systems, announces its unaudited results for the six months ended 30 June 2015.

For further information:

 
 SerVision plc                                     +972 2535 0000 
  Gidon Tahan, Chairman and CEO 
  Allenby Capital Limited (Nominated Adviser 
   and Joint Broker)                           +44 (0)20 3328 5656 
  Nick Athanas / James Reeve 
  Beaufort Securities Limited (Joint Broker) 
  Jon Levinson / Elliot Hance                  +44 (0)20 7382 8300 
 
  Cadogan Leander (Financial PR) 
  Christian Taylor-Wilkinson       +44 (0)7795 168 157 
 
 
 
 
  Notes to Editors 
 
  SerVision is a pioneer in the field 
  of security communications technology 
  and a leading developer and manufacturer 
  of fully integrated video recording 
  and transmission systems for homeland 
  security and transportation applications. 
  The Company's core technology is 
  proprietary video compression which 
  is optimised for streaming real-time 
  video over any type of cellular 
  or narrowband network. 
 
  REPORT AND FINANCIAL STATEMENTS 
  FOR THE SIX MONTHS ENDED 30 JUNE 
  2015 
 

CHAIRMAN'S STATEMENT

The Board today announces SerVision's consolidated group interim results for the six months ended 30 June 2015. Revenue during this period amounted to a modest $1,242,000 and our net loss was $1,445,000. While on the surface these numbers appear low (relative to last year's revenue of $1,842,000 and net loss of $892,000 for the same period), I can assure investors that the current results are an inevitable outcome of our transition to a new recurring revenue business model. With this new commercial framework in place we are generating less revenue initially, but the Directors anticipate these will lead to more significant revenues of a recurring nature of a recurring nature in the long term. In addition, a number of significant opportunities, particularly in China, were put on hold in H1 as customers have been reluctant to issue further purchase orders until our new IP-based IVG400-N is ready for market. I am pleased to say that we have a healthy pipeline for H2 and I expect better results going forward, as our new IVG is slated for release in the coming weeks and we are poised to start collecting recurring monthly revenue from a number of existing projects and customers.

Sales and Marketing

SerVision's most significant accomplishment over the course of 2015 has been the opening of a UK office in Manchester that is now making direct sales to customers and offering full turn-key solutions for customers, including services and technical support. We have already secured our first project with Gatwick Airport and has been approved as a supplier by the airport. During H1, two major fleet and driver management companies, Matrix and GreenRoad, integrated SerVision's video streaming protocol into their platform, and they initiated a number of UK-based pilots which we believe have strong sales potential. For all of these opportunities and contract wins, SerVision's UK office will be providing stand-alone and integrated systems, installation service, technical support, and cellular data packages that will be paid in monthly installments over a 24 or 36 month period. The UK office has just hired a new support engineer and is currently operating with a staff of five.

During H1, SerVision supplied over seven hundred and fifty MVG400 units, aggregately valued at $915,000, for bus projects in Brazil and Kazakhstan, and it received new orders from cash-in-transit companies in South Africa as well as from Israel's largest bus operator, Egged. Also, during this period, we began pilots for a range of new bus and cash-in-transit fleet projects in Nigeria, Tanzania, and Mexico. We also recently completed the homologation process for SerVision's mobile DVRs in Peru, paving the way for new market penetration in that country. In the United States we have been invited to participate in a pilot for Manhattan City School Buses (where the fleet size is 7,000), and we've recently submitted bids with four local police counties to supply a wearable CCTV solution based on the CVG-M. Earlier this month, after an extensive testing period, the Company learned that it has been short-listed for a project to supply up to 1,000 HVGs for deployment at select US traffic junctions nationwide. We also have a significant opportunity on the horizon for a bus project in the Chinese Municipality of ChongQuing (an existing SerVision customer) but, as mentioned above, the customer has delayed plans to begin this project until the new IVG400-N is available. I anticipate further progress to be made in the Chinese marketplace once the new product has been launched.

Research and Development

Our R&D team's primary focus during H1 (and subsequently) has been to get the new IVG400-N ready for market. The Directors believe that the system's support for IP cameras and High Definition (HD) recording give it a considerable advantage over the current range of mobile DVR solutions on the market (which only support analog cameras and standard definition recording). The IVG has a built-in 3G/4G modem and it supports advanced streaming/transcoding capabilities that are optimised for live transmission over low bit-rate networks. In addition, like the MVG series, it has built-in support for WiFi, GPS, Audio and G-Force, as well as a range of virtual sensors to detect motion, ignition status, geo-fencing violations, speed thresholds and more. A small quantity of IVGs have already been reserved for select customers with high sales potential, and we expect to be able to showcase the IVG400-N during the SEECAT Anti-Terrorism exhibition in Tokyo, Japan in October 2015. The Directors expect that the product will be in mass production shortly thereafter.

While our server team has been busy developing the IVG platform, our software team has been focused on developing a new client software application which will support HD streams and our new optimized H.264 streaming codec. The new client is named "SVCentral," and it will be compatible with the IVG400 as well as the existing range of SerVision products. It will be launched together with the IVG400-N. Another high priority R&D initiative we undertook during H1 entailed adding support for a video streaming platform that enables customers to view live video streams from SerVision DVRs in any web-browser. Prior to this, our SDK was only compatible with Internet Explorer so web client applications developed by third-parties could only access our systems from within this particular browser. With newly added support for the NGNIX platform, video streaming web clients for SerVision products are now possible in Google's Chrome, Mozilla's Firefox and Apple's Safari.

Financials

   --     Revenues for this period were $1,242,000 compared to $1,842,000 for the same period in 2014. 

-- Operating loss for the period was $1,436,000 compared to an operating loss of $814,000 for the same period in 2014.

-- Net loss for the period was $1,445,000 compared to a loss of $892,000 for the same period in 2014.

In May 2015, the Company announced a subscription to raise GBP911,927 through a subscription for new ordinary shares with existing shareholders and new investors. The net proceeds of the subscription are being utilised to satisfy the Company's existing order book and for general working capital purposes.

Since the period end the Company announced, on 25 September 2015, a placing to raise a further GBP800,000 at a price of 3.5 per share with existing shareholders and new investors. The Placing was arranged by Beaufort Securities as the Company's joint broker.

Conclusion

Although we achieved modest results for H1 2015, I believe that our new recurring revenue business model is the correct long-term strategy for SerVision, and I am currently exploring this commercial model for South Africa where we already have a strong reputation and solid market presence. I am very excited about our new product release and look forward to sharing better results in the future as we grow our market share in the UK, and begin introducing the IVG400-N into global markets.

As always, I am grateful to our shareholders for their confidence and support, and also to the SerVision team for their dedication, commitment and outstanding work.

Gideon Tahan

Chairman and CEO

30 September 2015

SERVISION PLC

CONDENSED GROUP COMPREHENSIVE INCOME STATEMENT

FOR THE SIX MONTHS ENDED 30 JUNE 2015

 
            Six months   Six months   Year to 31 
                to           to 
             30 June      30 June      December 
               2015         2014         2014 
     Note     $'000        $'000        $'000 
            Unaudited    Unaudited     Audited 
 
 
 
 REVENUE                            3       1,242       1,842          4,236 
 
 Cost of sales                              (752)       (806)        (1,843) 
 
 GROSS PROFIT                                 490       1,036          2,393 
 
 Administrative expenses                  (1,926)     (1,850)        (3,058) 
 
 OPERATING LOSS                           (1,436)       (814)          (665) 
 
 Net finance expense                         (22)        (77)          (129) 
 
 LOSS ON ORDINARY 
 ACTIVITIES BEFORE TAXATION               (1,458)       (891)          (794) 
 
 Tax on loss on ordinary 
  activities                        4          13         (1)            (1) 
 
 NET LOSS FOR THE PERIOD                  (1,445)       (892)          (795) 
 
 Translation difference arising 
  from 
  translating into presentation 
  currency                                   (99)        (18)             66 
 

(MORE TO FOLLOW) Dow Jones Newswires

September 30, 2015 08:42 ET (12:42 GMT)

 TOTAL COMPREHENSIVE 
  LOSS FOR THE PERIOD                     (1,544)       (910)         ( 729) 
 
 Loss per share 
 
 BASIC                              5     (1.75)c     (1.61)c        (1.16)c 
 
 DILUTED                                  (1.75)c     (1.61)c        (1.16)c 
 
 

CONDENSED GROUP BALANCE SHEET

AT 30 JUNE 2015

 
                                                   As at 30     As at 30      As at 31 
                                                     June         June 
                                                     2015         2014        December 
                                                                                 2014 
                                                       $'000     $'000              $'000 
                                                  Unaudited    Unaudited          Audited 
 ASSETS 
 Non-current assets 
 Intangible assets                                     4,749        4,605           4,691 
 Deferred tax asset                                       96           83              82 
 Property, plant and equipment                            63           77              70 
                                                       4,908        4,765           4,843 
 Current assets 
 Inventories                                             670          585             597 
 Trade and other receivables                           1,341        1,613           1,853 
 Cash and cash equivalents                                24          173             101 
                                                       2,035        2,371           2,551 
 
 Total assets                                          6,943        7,136           7,394 
 
 EQUITY 
 Capital and reserves attributable 
  to the Company's equity shareholders 
 Called up share capital                               1,498          984           1,224 
 Share premium account                                14,671       12,639          13,588 
 Merger reserve                                        1,979        1,979           1,979 
 Advance subscription                                      -        1,036               - 
 Other reserve                                            66           64              66 
 Retained earnings and translation 
  reserves                                          (14,672)     (13,309)        (13,128) 
 Total equity                                          3,542        3,393           3,729 
 
 LIABILITIES 
 Current liabilities 
 Short term credit from banking 
  institutions                                           873        1,144           1,042 
 Overdrafts                                               --           63              -- 
 Loan from the office of the 
  chief scientist                                        161          161             161 
 Trade and other payables                              1,635        1,292           1,721 
                                                       2,669        2,660           2,924 
 Non-current liabilities 
 Long term loan from bank 
  institution 
  without current maturity                               434          656             443 
 Loan from Office of the Chief 
  Scientist                                               11           11              11 
 Post employment benefits                                287          416             287 
                                                         732        1,083             741 
 
 Total liabilities                                     3,401        3,743           3,665 
 
 Total equity and liabilities                          6,943        7,136             7,394 
 
 

CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 30 JUNE 2015

 
 
 
                                       Share                   Share                      Merger                  Other                    Retained                     Translation 
                                     Capital                 Premium                    Reserve                  Reserve                  Earnings                       Reserve                                                   Total 
                                      $'000                   $'000                      $'000                    $'000                     $'000                         $'000                                                    $'000 
                                                                                                                                                                                                      Advance 
                                                                                                                                                                                                    subscription 
                                                                                                                                                                                                        $'000 
  As at 1 January 
   2014                                         984                   12,639                        1,979                  62                        (12,495)                           96                            -                     3,265 
 
 
    Total recognised 
    expense                                       -                        -                            -                   -                           (892)                         (18)                            -                     (910) 
 
 
               Advance 
               subscription                       -                        -                            -                   -                               -                            -                        1,036                     1,036 
 
  Share option 
   charge                                         -                        -                            -                   2                               -                            -                            -                         2 
 
  At 30 June 2014                               984                   12,639                        1,979                  64                        (13,387)                           78                        1,036                     3,393 
 
    Total recognised 
    expense                                       -                        -                            -                   -                             259                           84                            -                       181 
 
  Issue of shares                               240                      949                            -                   -                               -                            -                      (1,036)                       153 
 
  Share option 
   charge                                         -                       --                           --                   2                               -                            -                            -                         2 
 
  As at 31 December 
   2014                                       1,224                   13,588                        1,979                  66                        (13,290)                          162                            -                     3,729 
 
  Issue of shares                               274                    1,083                            -                   -                               -                            -                            -                     1,357 
 
    Total recognised 
    expense                                       -                        -                            -                   -                         (1,445)                         (99)                            -                   (1,544) 
 
  Share option                                    -                        -                            -                   -                               -                            -                            -                         - 
   charge 
 
  At 30 June 2015                             1,498                   14,671                        1,979                  66                        (14,735)                           63                            -                     3,542 
 
 

CONDENSED GROUP CASH FLOW STATEMENT

FOR THE SIX MONTHS ENDED 30 JUNE 2015

 
                                                Six months    Six months    Year to 
                                                    to            to           31 
                                                 30 June       30 June      December 
                                                   2015          2014         2014 
                                                  $'000         $'000        $'000 
                                                Unaudited     Unaudited     Audited 
 Cash flows from operating activities 
 
 Loss before taxation                               (1,458)        (891)        (794) 
 Adjustments for: 
 Net finance expense                                     22           77          129 
 Doubtful debts                                         462          578          604 
 Depreciation and amortisation                          333          387        1,088 
 Movement in trade and other receivables                 73        (456)      (1,402) 
 Movement in tax assets                                (13)            -            1 
 Movement in inventories                               (74)         (21)         (33) 
 Movement in post retirement benefits                   (1)            4        (125) 
 Movement in trade and other payables                  (86)        (245)          138 
 
 Net cash outflow from operating activities           (742)        (567)        (394) 
 
 Cash flow from investing activities 
 
 Purchase of property, plant and equipment 
  and intangibles                                     (384)        (329)        (626) 

(MORE TO FOLLOW) Dow Jones Newswires

September 30, 2015 08:42 ET (12:42 GMT)

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