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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Universe Group Plc | LSE:UNG | London | Ordinary Share | GB0009483594 | 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% | 11.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMUNG
RNS Number : 8502U
Universe Group PLC
12 April 2016
12 April 2016
AIM: UNG.L
Universe Group plc
("Universe", the "Group" or the "Company")
FINAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2015
Universe Group plc (AIM: UNG.L), a leading developer and supplier of point of sale, payment and loyalty systems, is pleased to announce today its audited results for the year ended 31 December 2015.
Highlights
Financial
-- Continued encouraging progress including landmark convenience store contract win -- Total revenues of GBP20.33m (2014: GBP20.75m) -- Gross profit up 4% to GBP6.74m (2014: GBP6.49m) reflecting change in revenue profile -- Operating profit up 18% to GBP2.04m (2014: GBP1.73m) -- Profit before tax of GBP1.68m (2014: GBP1.75m) -- Profit after tax up 7% to GBP1.50m (2014: GBP1.41m) -- Operating profit per share up 11% to 0.89p (2014: 0.80p) -- Statutory basic EPS up 1.5% to 0.66p (2014: 0.65p) -- Strong cash generation with net cash at year end up to GBP2.14m (2014: GBP0.24m)
Operational
-- Continued expansion within the convenience store sector - major contract win with Conviviality Plc in October - acquisition of Spedi in April extends convenience retail offering - ongoing development of product offering -- Two Board appointments (in May and September) -- Board remains positive about growth prospects
Robert Goddard, Chairman of Universe, commented:
"We are pleased with the progress made over the year, particularly in expanding our presence within the convenience store sector, a key strategic focus.
Financial results show strong operating profit growth of 18% and a significant increase in profit margins. This has been supported by a combination of new product development and the winning of major new contracts, including Conviviality plc, announced in October 2015.
Universe remains well placed for further progress in 2016. We will continue to develop our established position in the petrol forecourt market and seek to achieve further strong growth in the convenience store sector. At the same time, we will look for opportunities to enter additional retail verticals. We will continue to invest in the expansion of our product range and services so as to further enhance our offering. We also expect to tender for contracts with major new customers".
For further information:
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Universe Group plc T: +44 2380 689
Robert Goddard, Chairman 510
Jeremy Lewis, Chief Executive
Officer
Bob Smeeton, Chief Financial
Officer
finnCap T: +44 2072 200
Stuart Andrews (corporate 500
finance)
Tony Quirke (corporate broking)
KTZ Communications T: +44 2031 786
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Katie Tzouliadis
Viktoria Langley
Emma Pearson
CHAIRMAN'S STATEMENT
Introduction
The Group made encouraging progress during 2015, in particular by expanding its presence in the convenience store market, a key strategic focus. Results for the year show an 18% increase in operating profit to GBP2.04m (2014: GBP1.73m), with operating profit margins improving to 10% from 8%. This was achieved on total revenues of GBP20.33m (GBP20.75m). While revenues reduced by 2% year-on-year, this reflected our decision to cease a number of low margin contracts late in 2014. The benefit is reflected in improved gross profit margins, up to 33% from 31% in 2014, and an increase in gross profit to GBP6.74m (2014: GBP6.49m).
The Group continues to generate strong cash flows from operations, which increased by 15% to GBP3.42m. The balance sheet remains strong, with net cash at the year-end up to GBP2.14m (2014: GBP0.24m).
Looking ahead for 2016, Universe remains well-placed to make further progress and we continue to consider opportunities for growth.
Overview
As expected, sales over the year were weighted significantly towards the second half, reflecting the timing of hardware and software deployments. At GBP11.50m, second half sales were 30% ahead of the first half and gross profit was 53% up.
A notable feature of the second half was the winning of a large and prestigious contract with Conviviality Plc, the UK's largest franchised off-licence and convenience store chain. This is a significant endorsement of our strategy to extend the Group's presence in the convenience store market. Secured after an international competitive tender process, it also reflects the strength of our proprietary product offering. Deployment of our products began in January 2016 and continues to date, with the roll-out of our system covering Conviviality's entire estate of over 650 stores. As well as facilitating and managing sales processing and secure payments, our software will also manage online ordering and provide an extensive reporting suite.
The development of our product offering remains important to us and we continued to invest across our products over the year. This included the acquisition in April 2015 of Spedinorcon Limited ('Spedi'), a developer and supplier of advanced software for the convenience store market. Spedi products are used across an established estate of more than 1,500 convenience stores, mainly across the Costcutter and Londis networks.
There will be further investment in our products in 2016. Our plans include refinements to our loyalty platform, which will provide a more modular solution, alongside a series of initiatives to expand our existing product range. Our aim is to become a 'one-stop shop' for retail technology and we see this being achieved through a combination of organic growth, bolt-on acquisitions and collaboration with partners. We are pleased with the increasing awareness of HTEC's products in the convenience store market, which we intend to capitalise on over the coming year.
The Board
The Board was strengthened with two new appointments over the year. In September, we were delighted to welcome Baljit (Billy) Tank as an Executive Director with responsibility for Group Sales and Marketing. Billy joined the Group in 2013 with our acquisition of Indigo Retail Holdings Limited, which he founded and led. In May, we were pleased to appoint Andrew Blazye as a Non-executive Director. Andrew has extensive knowledge of our core markets, having over thirty years' experience in loyalty marketing, petrol retailing and payments systems.
Staff
2015 was a busy year for the Group as we moved through the phases of developing products, winning contracts and deploying new solutions for customers. We would like to thank all our staff for their hard work, creativity and dedication over the year. Their efforts and skills underpin the Group's success in serving our existing customers and winning new ones.
Summary and outlook
We made good progress in 2015, winning important contracts and continuing to develop our product offering. The roll-out of contracts won last year is now underway and we are working hard to ensure their successful delivery.
We will further expand our presence in the convenience store sector and continue to develop our well-established presence in the petrol forecourt market. With our widened and enhanced product suite and strong service offering, we believe that we are well-placed to satisfy evolving customer needs in both markets. In addition, we continue to explore new retail verticals and new geographic markets. We will also invest in products and services and thereby improve further our market position.
We are positive about our prospects for further growth and look forward to another year of good progress.
Robert Goddard
Chairman
11 April 2016
Extracts from the Strategic Report
Principal activity
The Group designs, develops and supports point of sale, payment and on-line loyalty solutions and systems for the UK petrol forecourt and convenience store markets. These solutions can be provided as a comprehensive, fully-managed offering or as discrete products to complement a wider customer solution.
Universe's solutions are delivered via the Cloud into high volume, real-time environments. Product innovation and high levels of customer care are critical to the Group's success and we continue to focus strongly on both areas.
Organisational overview
The Group's business is directed by the Board and managed by the Executive Directors, led by Chief Executive, Jeremy Lewis. A senior management team, comprising the Chief Executive, the Chief Financial Officer, the Sales and Marketing Director and Senior Executives, is responsible for Operations, Human Resources, Development and Data Centres.
There are three Non-executive Directors.
The main operating entity is HTEC Limited.
Strategy and business plan
We continue to invest in our products and services to ensure that they meet the current and anticipated needs of our customers.
Our objective is to be the prime solutions partner to retailers, supplying them with our market-leading, innovative systems for point of sale, payment and loyalty operations. These systems are real-time, mission-critical and data rich and our customers rely on us to keep them trading at all times. Accordingly, effective and efficient support from our data centre teams, engineer field force and helpdesk professionals remains vital to what we do.
In 2015 we provided new and improved product offerings to our existing customers and won new strategic accounts. We are targeting further growth in both our established market of petrol forecourts and in our newer market of convenience stores. In addition, the possibility of entry into new market verticals and geographies is under review.
A number of acquisition opportunities were considered during 2015 and we were pleased to complete the acquisition of Spedinorcon Limited, a provider and developer of retail software, in April 2015. The business is now fully integrated into the Group.
Business and product development
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April 12, 2016 02:00 ET (06:00 GMT)
The need for business and product development is constant and so 2015 was another busy year. Examples of new developments in 2015 include our new Back Office System (Calisto), Head Office System (Jupiter), advertising media screens (Iocaste) and point-to-point payment encryption layer (Perseus). We expect further sales of this enhanced product set in 2016 and beyond.
Financial review
Total sales for the year to 31 December 2015 decreased by 2% to GBP20.33m (2014: GBP20.75m) with this reduction reflecting our decision to cease some low margin service contracts inherited with the acquisition of Retail Service Team in 2013. The benefit of exiting these contracts can be seen in both the gross profit result, which increased by 4% to GBP6.74m (2014: 6.49m) and the gross margin improvement to 33% (2014: 31%).
Operating profit for the year increased by 18% to GBP2.04m from GBP1.73m in 2014, with the operating margin increasing by 25% to 10% from 8%. The achievement of a 10% operating margin has been an important target for the Group.
Net finance costs increased by GBP0.39m to GBP0.36m (2014: income of GBP0.03m). This increase reflected a revision to the estimated contingent consideration due in 2016 to the vendors of Indigo (which was acquired in 2013), and results from our success in the convenience store market. Consequently, a provision of GBP0.22m released in 2014 was largely reversed in 2015. As a result of these movements, profit before tax decreased by 4% to GBP1.68m (2014: GBP1.75m).
Profit after tax rose by 7% to GBP1.50m (2014: GBP1.41m). The tax charge reduced from GBP0.35m to GBP0.18m, partly as a result of prior year credits that were recognised in 2015.
Basic and diluted earnings per share respectively increased by 1.5% to 0.66p (2014: 0.65p) and by 5% to 0.63p (2014: 0.60p). However, with the year-on-year variations in finance expenses, these measures do not provide a satisfactory indication of the Group's progress in 2015. A better measure is operating profit per share, which increased by 11% over the year to 0.89p (2014: 0.80p).
Cash flow and financing
Adjusted EBITDA rose by 13% to GBP3.91m (2014: GBP3.47m). This supported a 15% increase in net cash inflow from operating activities to GBP3.42m (2014: GBP2.96m).
We continued to invest in our products in 2015, spending GBP0.61m on the development of our product portfolio (2014: GBP1.15m). The main investment was into our new Jupiter, Calisto and Iocaste products, which are attracting interest from existing and prospective customers.
Cash inflow for the year increased by 21% to GBP1.32m (2014: GBP1.09m) and net cash at 31 December 2015 stood at GBP2.14m (2014: GBP0.24m).
Summary
As a software business operating in the fast-moving retail environment, we have continued to prosper over the past three years through focused product innovation and careful attention to customer service. In 2015 we continued to build on our strong presence in the petrol forecourt sector and have strengthened our presence in the larger market of convenience stores. A combination of customer expansion and a broadening product portfolio means that we are confident that the pleasing progress that the Group has been made so far can be continued.
Jeremy Lewis
Chief Executive Officer
11 April 2016
Consolidated Statement of Total Comprehensive Income
For the year ended 31 December 2015
2015 2014
GBP'000 GBP'000
Continuing operations
Revenue 20,327 20,749
Cost of sales (13,591) (14,261)
Gross profit 6,736 6,488
Administrative expenses (4,698) (4,760)
Operating profit 2,038 1,728
Finance income 10 220
Finance expense (373) (195)
Profit before taxation 1,675 1,753
Taxation (175) (345)
Profit and total comprehensive
income for the year 1,500 1,408
Earnings per ordinary share
Basic earnings per share 0.66p 0.65p
Diluted earnings per share 0.63p 0.60p
Consolidated Statement of Changes in Equity
For the year ended 31 December 2015
Capital Merger Profit
Share redemption Share reserve Translation and Total
capital reserve premium on acquisition reserve loss equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January
2014 2,115 4,588 12,381 2,269 (225) (4,604) 16,524
Profit and
total
comprehensive
income for
the year - - - - - 1,408 1,408
Issue of share
capital 88 - 335 - - - 423
Share based
payments - - - - - 107 107
------------- ------------- ------------- ------------- ------------- ---------- -----------
At 31 December
2014 2,203 4,588 12,716 2,269 (225) (3,089) 18,462
At 1 January
2015 2,203 4,588 12,716 2,269 (225) (3,089) 18,462
Profit and
total
comprehensive
income for
the year - - - - - 1,500 1,500
Issue of share
capital 110 - 346 - - - 456
Share based
payments - - - - - 122 122
At 31 December
2015 2,313 4,588 13,062 2,269 (225) (1,467) 20,540
Consolidated Balance Sheet
As at 31 December 2015
2015 2014
GBP'000 GBP'000
Non-current assets
Goodwill and other intangible assets 14,075 14,121
Development costs 2,367 2,382
Property, plant and equipment 2,217 2,466
18,659 18,969
Current assets
Inventories 881 1,406
Trade and other receivables 4,296 4,221
Cash and cash equivalents 3,380 2,064
8,557 7,691
Total assets 27,216 26,660
Current liabilities
Trade and other payables (4,445) (5,138)
Current tax liabilities (248) (188)
Borrowings (478) (477)
Deferred consideration (6) (597)
Contingent consideration (414) (103)
(5,591) (6,503)
Non-current liabilities
Borrowings (763) (1,350)
Contingent consideration (58) (87)
Deferred tax (264) (258)
(1,085) (1,695)
Total liabilities (6,676) (8,198)
Net assets 20,540 18,462
Equity
Share capital 2,313 2,203
Capital redemption reserve 4,588 4,588
Share premium 13,062 12,716
Merger reserve 2,269 2,269
Translation reserve (225) (225)
Profit and loss account (1,467) (3,089)
Total equity 20,540 18,462
Consolidated Cash Flow Statement
For the year ended 31 December 2015
2015 2014
GBP'000 GBP'000
Cash flows from operating activities:
Profit before tax 1,675 1,753
Depreciation and amortisation 1,747 1,630
Share based payments 122 107
Net finance expense/(income) 363 (25)
3,907 3,465
Movement in working capital:
Decrease/(increase) in inventories 525 (281)
(Increase)/decrease in receivables (8) 2
Decrease in payables (768) (96)
Interest paid (127) (124)
Tax paid (109) (4)
Net cash inflow from operating
activities 3,420 2,962
Cash flows from investing activities:
Acquisition of subsidiary undertakings (309) (57)
Purchase of property, plant &
equipment (640) (243)
Expenditure on product development (612) (1,146)
Net cash outflow from investing
activities (1,561) (1,446)
Cash flow from financing activities:
Proceeds from issue of shares 56 23
Loan repayments (120) -
Repayments of obligations under
finance leases (479) (453)
Net cash outflow from financing (543) (430)
Increase in cash and cash equivalents 1,316 1,086
Cash and cash equivalents at
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April 12, 2016 02:00 ET (06:00 GMT)
beginning of year 2,064 978 Cash and cash equivalents at end of year 3,380 2,064
Notes
1. General Information
The financial information set out in this document does not constitute the Company's statutory accounts for 2014 or 2015. Statutory accounts for the years ended 31 December 2014 and 31 December 2015 have been reported on by the Independent Auditors. The Independent Auditors' Reports on the Annual Report and Financial Statements for each of 2014 and 2015 were unmodified, 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 December 2014 have been filed with the Registrar of Companies. The statutory accounts for the year ended 31 December 2015 will be delivered to the Registrar in due course, and will be available from the Company's registered office at George Curl Way, Southampton International Park, Southampton, SO18 2RX and from the Company's website www.universeplc.com.
The financial information set out in these results has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively Adopted IFRSs). The accounting policies adopted in these results have been consistently applied to all the years presented and are consistent with the policies used in the preparation of the statutory accounts for the period ended 31 December 2014. The principal accounting policies adopted are unchanged from those used in the preparation of the statutory accounts for the period ended 31 December 2014.
2. Turnover analysis
2015 2014
GBP'000 GBP'000
Hardware and software licences 5,470 4,801
Service and installations 6,909 8,048
Data services 3,601 3,409
Consultancy and software maintenance 4,347 4,491
20,327 20,749
3. Operating Profit and adjusted EBITDA
2015 2014
GBP'000 GBP'000
Revenue 20,327 20,749
Cost of sales (13,591) (14,261)
Gross profit 6,736 6,488
Administrative expenses (4,698) (4,760)
Operating profit 2,038 1,728
Add back:
Depreciation 903 812
Amortisation 844 818
Share based payments 122 107
Adjusted EBITDA 3,907 3,465
4. Segment information
The Group has only one business segment, 'HTEC Solutions'. All material operations and assets are in the UK.
Solutions Corporate Total
2015 2015 2015
GBP'000 GBP'000 GBP'000
Revenue - all external 20,327 - 20,327
Gross profit 6,736 - 6,736
Segment expenses (4,018) (680) (4,698)
Segment operating profit 2,718 (680) 2,038
Unallocated items:
Finance income (363)
Taxation (175)
Profit for the year 1,500
Solutions Corporate Total
2014 2014 2014
GBP'000 GBP'000 GBP'000
Revenue - all external 20,749 - 20,749
Gross profit 6,488 - 6,488
Segment expenses (4,138) (622) (4,760)
Segment operating profit 2,350 (622) 1,728
Unallocated items:
Finance costs 25
Taxation (345)
Profit for the year 1,408
5. Earnings per share
The calculation of the basic, diluted and operating earnings per share is based on the following data:
2015 2014
GBP'000 GBP'000
Profit for the purposes of basic
and diluted earnings per share being
net profit attributable to equity
holders of the parent 1,500 1,408
Add back/(deduct) net finance charge/(income) 363 (25)
Add back taxation charge 175 345
Profit used for operating profit
per share 2,038 1,728
2015 2014
Number Number
'000 '000
Number of shares
Weighted average number of ordinary
shares for the purposes of basic
earnings per share and operating
profit per share 227,996 216,914
Weighted average number of ordinary
shares for the purposes of diluted
earnings per share 238,023 232,814
At the year end the Group had in issue 231,286,435 ordinary shares of 1p each (2014: 220,281,758 ordinary shares of 1p each).
6. Material non-cash transactions
During the year the Group entered into GBP13,000 (2013: GBP687,000) of finance leases for plant and equipment.
During the year the Group settled GBP400,000 of deferred consideration arising on the acquisition of Indigo Retail Holdings Limited in 2013 by issuing ordinary shares in the Company.
These transactions are not reflected in the cash flow statement.
7. Report and Accounts
Copies of the Annual Report and Accounts will be sent to shareholders in May 2015 and copies will also be available, free of charge, from the Company's registered office at George Curl Way, Southampton SO18 2RX and from the Company's website www.universeplc.com.
8. Annual General Meeting
The Company's Annual General Meeting is scheduled for 28 June 2016, notice of which will be sent to shareholders next month.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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April 12, 2016 02:00 ET (06:00 GMT)
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