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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Vianet Group Plc | LSE:VNET | London | Ordinary Share | GB00B13YVN56 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -1.00 | -0.86% | 115.00 | 113.00 | 117.00 | 116.00 | 115.00 | 116.00 | 32,388 | 15:54:59 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Information Retrieval Svcs | 14.12M | 161k | 0.0055 | 209.09 | 33.96M |
From Apr 2019 to Apr 2024
TIDMVNET
RNS Number : 3412Y
Vianet Group PLC
05 December 2017
Press release 5 December 2017
Vianet Group plc
("Vianet", "Company" or "the Group")
Interim Results
Vianet Group plc (AIM:VNET), the international provider of actionable data and business insight through devices connected to its Internet of Things platform ("IOT"), is pleased to announce its interim results for the six months ended 30 September 2017.
Financial summary
Hot Features
Premium
-- Revenue of GBP6.71 million (H1 2017: GBP7.06
million) with recurring revenues at 90% (H1
2017: 86%) of turnover
-- Adjusted operating profit* up 3.97% to GBP1.70
million (H1 2017: GBP1.64 million)
-- Pre-exceptional items, profit before tax was
GBP1.29 million up from GBP1.26 million last
year
-- Profit before tax GBP0.90 million (H1 2017:
GBP1.13 million) after expensing GBP0.19 million
of corporate acquisition costs
-- Basic earnings per share (pre-exceptional items)
up 7.02% at 3.66p (H1 2017: 3.42p), including
a deferred tax adjustment charge of 1.05p
-- Operational cash generation of GBP1.25 million
(H1 2017: GBP1.50 million)
-- Net cash of GBP2.72 million (H1 2017: net cash
GBP1.98 million)
-- Interim dividend of 1.70p (H1 2017: 1.70p)
Divisional highlights
-- Smart Zones adjusted operating profit of GBP2.27
million (H1 2017: GBP2.39 million)
-- Smart Machines adjusted operating profit of
GBP0.47 million (H1 2017: GBP0.45 million)
-- Smart Machines growth continues with 2,395
new unit sales (H1 2017: 3,335 units), predominantly
in coffee vending
Post H1 period end
-- Earnings-enhancing strategic acquisition of
Vendman, the UK's leading unattended retail
management software company
-- Smart Machines material long term contract
win for the pan European and Australia and
New Zealand operations of a leading international
coffee company
-- Company reclassified as part of FTSE quarterly
ICB classification changes to the ICB subsector
of Telecommunication Equipment effective from
18 December 2017
* Adjusted operating profit is profit before exceptional costs, amortisation, interest and share based payments
Commenting on the interim results, James Dickson, Chairman of Vianet Group plc, said:
"I am pleased to report that the Group's continued focus on growth areas has resulted in a moderate increase in adjusted operating profits for the six months to 30 September 2017, with our recurring revenue streams being strengthened by growth in the Smart Machines division further enhancing the quality of the Group's earnings.
I was particularly pleased to report the acquisition of Vendman and a material contract win with a global coffee company post the year end as endorsement of the exciting growth prospects for our Smart Machines division. The revenue stream transition towards an annuity base will provide greater visibility and quality of future earnings for this division.
As we expand the iDraught(TM) footprint, develop new revenues from further Pubco data analytics and deliver efficiencies from increased automation in our Smart Zone division, the Group believes that the division's contribution can be sustained notwithstanding the challenges of the end customers' market.
Further we were pleased that the company's focus on IOT and data analytics has been recognised by way of the reclassification of Vianet to the Technology Supersector as part of the FTSE ICB quarterly classification changes which becomes effective as from 18 December 2017. We believe this should also bring Vianet to the attention of a wider audience.
Underpinned by high levels of recurring revenue, Group cash flow is strong and there is a solid financial platform to facilitate further expansion and development. The Board remains confident that Vianet's long term strategy is appropriate and that the Group is capable of delivering consistent and sustained growth."
- Ends -
An audio cast of the interim results presentation, given by Stewart Darling (Chief Executive) and Mark Foster (Chief Finance Officer), was released this morning, Tuesday, 5 December 2017 at 07.00hrs and is available on the Group's website, www.vianetplc.com.
Enquiries:
Vianet Group plc
James Dickson, Chairman Tel: +44 (0) 1642
Stewart Darling, CEO 358 800
Mark Foster, CFO
www.vianetplc.com
Cenkos Securities plc
Stephen Keys / Camilla Hume Tel: +44 (0) 20
7397 8900
www.cenkos.com
Media enquiries:
Yellow Jersey PR
Sarah Hollins Tel: +44 (0)7764
sarah@yellowjerseypr.com 947 137
www.yellowjerseypr.com
Chairman's Statement
I am pleased to report that the Group's focus on growth areas has resulted in a moderate increase in adjusted operating profits for the six months to 30 September 2017, as compared to the same period last year. In addition, the Group's recurring revenue streams have been strengthened further by growth in the Smart Machines division.
Against a background of continued pub closures, adjusted operating profit in the Smart Zones division remained stable at GBP2.27 million (H1 2017: GBP2.39 million). Vianet Americas added a further 31 new sites helping to reduce H1 year on year adjusted operating losses to GBP0.07 million (H1 2017: GBP0.08 million) despite additional costs associated with continuing some key long term iDraught commercial evaluations by national operators.
Notwithstanding our focus on increasing the proportion of recurring revenues thereby reducing the number of capital sales, we were pleased with the 5.6% year on year growth in adjusted operating profit delivered by the Smart Machines division.
Results
Turnover of GBP6.71 million (H1 2017: GBP7.06 million) was down compared to last year largely due to the transition in Smart Machines from capital to annuity sales, and as described above, the effect of pub closures on Smart Zones.
The Group's profit before amortisation, share based payments and exceptional items increased to GBP1.70 million (H1 2017: GBP1.64 million) as a result of improved operational efficiencies and administrative cost reductions.
Group profit before taxation reduced to GBP0.90 million (H1 2017: GBP1.13 million) after expensing GBP0.19 million in corporate acquisition costs.
Group earnings per share before exceptional costs and deferred tax adjustment amounted to 4.71 pence (H1 2016: 4.63 pence), with a deferred tax adjustment of GBP0.29 million reducing earnings per share before exceptional costs and post deferred tax adjustment to 3.66 pence (H1 2017: 3.42 pence).
Dividend
Reflecting the Board's continued confidence in the Group's growth plans and recent strategic news flow, the Board is pleased to maintain the interim dividend at 1.70 pence per share (H1 2017: 1.70 pence per share), payable on 31 January 2018 to shareholders on the register as at 15 December 2017. A final dividend of 4.00 pence per share was paid in respect of the year ended 31 March 2017 on 28 July 2017.
Outlook
Whilst growth and profitability in the Smart Zones division continues to be influenced by the challenging backdrop to the UK pub sector, the Group has strong prospects and the Board is confident that the management team can deliver strong growth.
We are excited by the growth prospects for Smart Machines which look increasingly assured following the acquisition of Vendman and the European contract win for a leading international coffee company. Additionally the transition in this division's revenues towards a significantly greater level of annuity, provide greater visibility and quality of future earnings.
As we expand the iDraught(TM) footprint, develop new revenues from further Pubco data analytics and deliver efficiencies from increased automation in our Smart Zone division, we are optimistic that the division's contribution can be sustained despite the challenges faced in its customers' core market of UK pub retailing.
Underpinned by high levels of recurring revenue, Group cash flow is strong and we have a solid financial platform to facilitate further expansion and development.
The Board were pleased with the recent FTSE ICB subsector reclassification of Vianet from Support Services to the Technology subsector of Telecommunications Equipment, effective from 18 December 2017, and believes this classification more accurately reflects the Group's IOT and data analytics driven business model. We believe that this should also bring Vianet to the attention of a wider audience which would be a favourable development.
The Board remains confident that Vianet's long term strategy is appropriate and that the Group is capable of delivering consistent and sustained growth, within the parameters of its influence and control.
James Dickson
Chairman
4 December 2017
Chief Executive and Chief Financial Officer Review
Underlying trading for the six months to 30 September 2017 has seen improvement as compared to the same period last year. The Group's strategy to achieve increased sales of newer products in Smart Zones and Smart Machines telemetry and contactless payment services has progressed in each area, albeit partially offset by the continued impact of pub disposals for Smart Zones and the Board's strategic decision to shift towards an annuity revenue model in Smart Machines. Whilst transitioning to an annuity model was expected to have an adverse impact on the revenue in the short term, the Board believes it will be more profitable for the business over the life of our contracts. The proportion of recurring service revenue has continued at high levels and exceptional costs, of GBP0.39 million (H1 2017: GBP0.14 million), were in line with our expectations and principally relate to costs of GBP0.19 million associated with corporate acquisitions and staff transitional costs.
Although good operational cash generation of GBP1.25 million (H1 2017: GBP1.50 million) was down on the previous period due to phasing of collections in the year to March 2017, the Group had an overall increase in its net cash position to GBP2.72 million at 30 September 2017 (H1 2017: GBP1.98 million). In summary, the Group continues to be highly cash generative which provides a strong financial base to invest in and grow the business.
Smart Zones
The underlying performance of the Group's core beer monitoring business remained stable over the period with further new iDraught(TM) sales despite the pub industry headwinds. iDraught(TM) continues to account for approximately 25% of the Group's beer monitoring base by number of installations. Over the period, Smart Zones secured 119 new beer monitoring installations (H1 2017: 166). Pub disposals resulted in a net reduction of circa 550 sites for the division to approximately 14,000 sites.
Our continued confidence in the future growth prospects for iDraught(TM) in the UK, despite the challenging backdrop of pub closures, is driven by installations for new customers and replacement systems for existing beer monitoring customers. In addition, our continued investment in new technology and the migration of data and services to the cloud has significantly increased the business opportunity for Smart Zones to roll-out enhanced insight and data services to our Pubco customers.
In the US, the roll out of iDraught(TM) has increased the installation base to 247 sites and we are moving towards increasing the pace of the roll out. The increase in installation bases combined with a refined cost base contributed to a further small reduction in losses and we expect the loss position to narrow further as we drive improved sales traction.
Smart Machines
Smart Machines continued to increase new telemetry and contactless payment sales although the top line revenue growth was lower as a result of circa 70% of sales coming from our new annuity-based model. This transition from capital plus annuity based income streams to annuity only is a key part of our strategy. The Board believes that this model will be more profitable over the life of the contract and provides for a clearer projection of business performance as it lessens the impact of variable capital sales.
Post the period end we were pleased to announce both the acquisition of Vendman, one of our distributors, and the significant contract win with an existing global customer in the coffee market, both of which we expect to stimulate substantially increased momentum for Smart Machines as well as bringing greater scale to the division. Naturally, whilst negotiations with both of these were ongoing, orders were at a slower pace than during the previous year.
The acquisition of Vendman Systems, a leading Enterprise Resource Planning and mobile software provider for unattended retailing, is a highly complementary fit with the Smart Machines division, and offers a compelling strategic, commercial and financial rationale as it will:
-- Establish a comprehensive portfolio of market leading solutions for unattended retail through the combining existing expertise, products and services.
-- Create significant cross selling opportunities for the combined commercial team as it will:
o Provide a larger market for the sale of IOT connectivity and real-time data
o Accelerate the rollout of contactless payment technology for unattended retail
o Create new opportunities for the ERP and mobile platform capability
-- Unlock incremental big data revenue opportunity through building market leading analytics and insight from combined data sets
-- Significantly enhance route to market and distribution opportunities across Continental Europe through establishing a strong network and footprint
Combined with the major contract win, it is anticipated that the Smart Machines telemetry and contactless business growth will enhance earnings through accelerated growth in the coming year and further into the future.
Looking forward
The Board believes there is also substantial scope to maximise the potential of existing products and services as well as bringing new offerings to both Smart Machines and Smart Zones through continued accelerated investment in new technology. This investment, primarily in new infrastructure and cloud based capability, enables the creation and delivery of new data and insight based services and mobile applications which further enhance the value of the toolsets we can offer to customers.
Stewart Darling Mark Foster
Chief Executive Chief Financial
Officer
4 December 2017
Consolidated Statement of Comprehensive Income
For the six months ended 30 September 2017
Before Exceptional Exceptional Total Unaudited Unaudited Audited
6 months 6 months 6 months 6 months Year
Ended Ended Ended Ended Ended
30 Sept 30 Sept 30 Sept 30 Sept 31 March
2017 2017 2017 2016 2017
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Continuing operations
Revenue 3 6,714 - 6,714 7,057 14,263
Cost of sales (2,016) - (2,016) (2,109) (4,327)
================================ ===== ===================== ============ ================ ========== ==========
Gross profit 4,698 - 4,698 4,948 9,936
Administration and other
operating expenses 4 (2,995) (388) (3,383) (3,445) (7,585)
================================ ===== ===================== ============ ================ ========== ==========
Operating profit pre
amortisation and share based
payments 3 1,703 (388) 1,315 1,503 2,351
-------------------------------- ----- --------------------- ------------ ---------------- ---------- ----------
Intangible asset amortisation (344) - (344) (347) (693)
Share based payments (73) - (73) (24) (206)
================================ ===== ===================== ============ ================ ========== ==========
Operating profit post
amortisation and share based
payments 1,286 (388) 898 1,132 1,452
Net finance income/(costs) 1 - 1 (3) (5)
================================ ===== ===================== ============ ================ ========== ==========
Profit from continuing
operations before tax 1,287 (388) 899 1,129 1,447
Income tax expense 5 (287) - (287) (330) (417)
-------------------------------- ----- --------------------- ------------ ---------------- ---------- ----------
Profit from continuing
operations 1,000 (388) 612 799 1,030
Profit from discontinued
operations: - - - - 100
-------------------------------- ----- --------------------- ------------ ---------------- ---------- ----------
Profit and other comprehensive
income for the year 3 1,000 (388) 612 799 1,130
-------------------------------- ----- --------------------- ------------ ---------------- ---------- ----------
Earnings per share
Continuing Operations
- Basic 6 2.24p 2.93p 3.77p
- Diluted 6 2.23p 2.91p 3.76p
------------------------- ------ ------ ------
Discontinued Operations
- Basic 6 0.0p 0.0p 0.37p
- Diluted 6 0.0p 0.0p 0.36p
------------------------- ------ ------ ------
Consolidated Balance Sheet
At 30 September 2017
Unaudited Unaudited Audited
As at As at As at
30 Sept 30 Sept 31 March
2017 2016 2017
GBP'000 GBP'000 GBP'000
------------------------------ ---------- ---------- ----------
Assets
Non-current assets
Intangible assets 17,946 17,440 17,503
Property, plant and
equipment 3,078 3,058 3,069
Total non-current assets 21,024 20,498 20,572
=============================== ========== ========== ==========
Current assets
Inventories 1,012 1,666 1,308
Trade and other receivables 2,995 3,155 2,708
Deferred tax asset 173 152 460
Cash and cash equivalents 3,864 3,834 4,549
------------------------------- ---------- ---------- ----------
8,044 8,807 9,025
============================== ========== ========== ==========
Total assets 29,068 29,305 29,597
=============================== ========== ========== ==========
Equity and liabilities
Liabilities
Current liabilities
Trade and other payables 3,578 3,239 3,728
Borrowings 443 996 325
Provisions - - 62
4,021 4,235 4,115
============================== ========== ========== ==========
Non-current liabilities
Borrowings 699 858 778
Provisions - - 48
Deferred tax 395 - 395
1,094 858 1,221
------------------------------ ---------- ---------- ----------
Equity attributable
to owners of the parent
Share capital 2,843 2,843 2,843
Share premium account 11,287 11,287 11,287
Share based payment
reserve 466 235 418
Own shares (1,115) (1,221) (1,221)
Merger reserve 310 310 310
Retained profit 10,162 10,758 10,624
------------------------------- ---------- ---------- ----------
Total equity 23,953 24,212 24,261
=============================== ========== ========== ==========
Total equity and liabilities 29,068 29,305 29,597
=============================== ========== ========== ==========
Summarised Consolidated Cash Flow Statement
For the six months ended 30 September 2017
Unaudited Unaudited Audited
6 months 6 months Year
Ended Ended Ended
30 Sept 30 Sept 31 March
2017 2016 2017
GBP'000 GBP'000 GBP'000
----------------------------------- ---------- ---------- ---------
Cash flows from operating
activities
Profit for the period 612 799 1,130
Adjustments for
Net Interest (received)/payable (1) 3 5
Income tax expense 287 330 417
Amortisation of intangible
assets 344 347 693
Depreciation 177 177 348
Loss on sale of property,
plant and equipment 7 45 (50)
Share-based payments 73 24 207
------------------------------------ ---------- ---------- ---------
Operating profit before
changes in
working capital and provisions 1,499 1,725 2,750
Change in inventories 296 145 502
Change in receivables (288) 409 857
Change in payables (149) (777) (289)
Change in provisions (110) - 110
(251) (223) 1,180
Cash generated from operations 1,248 1,502 3,930
Income tax refunded - - -
----------------------------------- ---------- ---------- ---------
Net cash from operating
activities 1,248 1,502 3,930
------------------------------------ ---------- ---------- ---------
Cash flows from investing
activities
Proceeds on disposal
of subsidiary division - - 100
Purchases of property,
plant and equipment (193) (137) (325)
Purchase of intangible
assets (788) (302) (711)
Net cash used in investing
activities (981) (439) (936)
------------------------------------ ---------- ---------- ---------
Cash flows from financing
activities
Net Interest receivable/(payable) 1 (3) (5)
Share options exercised 103 - -
Repayments of borrowings (245) (244) (488)
Dividends paid (1,096) (1,092) (1,557)
Net cash used in financing
activities (1,237) (1,339) (2,050)
------------------------------------ ---------- ---------- ---------
Net (decrease)/increase
in cash and cash equivalents (970) (276) 944
Cash and cash equivalents
at beginning of period 4,549 3,605 3,605
Cash and cash equivalents
at end of period 3,579 3,329 4,549
------------------------------------ ---------- ---------- ---------
Statement of changes in equity
Six months ended 30 September 2017
Share
Share based
Share premium payment Own Merger Retained
capital account reserve shares reserve profit Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 April 2017 2,843 11,287 418 (1,221) 310 10,624 24,261
Dividends - - - - - (1,096) (1,096)
Share based payment - - 73 - - - 73
Share option
forfeitures - - (26) - - 26 -
Exercise of options - - 1 106 - (4) 103
Transactions
with owners - - 48 106 - (1,074) (920)
--------------------- --------- --------- --------- -------- --------- --------- --------
Profit and total
comprehensive
income for the
period - - - - - 612 612
--------------------- --------- --------- --------- -------- --------- --------- --------
Total comprehensive
income less owners
transactions - - 48 106 - (462) (308)
At 30 September
2017 2,843 11,287 466 (1,115) 310 10,162 23,953
===================== ========= ========= ========= ======== ========= ========= ========
Six months ended 30 September 2016
Share
Share based
Share premium payment Own Merger Retained
capital account reserve shares reserve profit Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 April 2016 2,843 11,287 217 (1,221) 310 11,045 24,481
Dividends - - - - - (1,092) (1,092)
Share based payment - - 24 - - - 24
Share option
forfeitures - - (6) - - 6 -
Transactions
with owners - - 18 - - (1,086) (1,068)
--------------------- --------- --------- --------- -------- --------- --------- --------
Profit and total
comprehensive
income for the
period - - - - - 799 799
--------------------- --------- --------- --------- -------- --------- --------- --------
Total comprehensive
income less owners
transactions - - 18 - - (287) (269)
At 30 September
2016 2,843 11,287 235 (1,221) 310 10,758 24,212
===================== ========= ========= ========= ======== ========= ========= ========
12 months ended 31 March 2017
Share
Share based
Share premium payment Own Merger Retained
capital account reserve shares reserve profit Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 April 2016 2,843 11,287 217 (1,221) 310 11,045 24,481
Dividends - - - - - (1,557) (1,557)
Share based payment - - 207 - - - 207
Share option
forfeitures - - (6) - - 6 -
Transactions
with owners - - 201 - - (1,551) (1,350)
--------------------- --------- --------- --------- -------- --------- --------- --------
Profit and total
comprehensive
income for the
year - - - - - 1,130 1,130
--------------------- --------- --------- --------- -------- --------- --------- --------
Total comprehensive
income less owners
transactions - - 201 - - (421) (220)
At 31 March 2017 2,843 11,287 418 (1,221) 310 10,624 24,261
===================== ========= ========= ========= ======== ========= ========= ========
Notes to the interim report
1. Statutory information
The interim financial statements are unaudited and do not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The auditor's review report on the interim financial information for the six months ended 30 September 2017 is set out on page 16.
The financial information for the year ended 31 March 2017 has been derived from the published statutory accounts. A copy of the full accounts for that period, on which the auditor issued an unmodified report that did not contain statements under 498(2) or (3) of the Companies Act 2006, has been delivered to the Registrar of Companies.
These interim financial statements will be posted to all shareholders and are available from the registered office at One Surtees Way, Surtees Business Park, Stockton on Tees, TS18 3HR or from our website at www.vianetplc.com/investors
2. Accounting policies
These interim financial statements are for the six months ended 30 September 2017. As is permitted, the Group has chosen not to adopt IAS 34 'Interim Financial Statements' and therefore the interim financial information is not in full compliance with International Financial Reporting Standards but have been prepared using consistent accounting policies as applied in the full year accounts to 31 March 2017. The accounts have been prepared on a going concern basis and are presented to the nearest GBP000 except as otherwise stated. They have been prepared using the recognition and measurement principles of IFRS as adopted by the European Union using the historic cost convention.
3. Segmental information
An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses. The segment operating results are regularly reviewed by the Chief Operating Decision Maker to make decisions about resources to be allocated to the segment and assess its performance. Vianet Group is analysed into to two trading segments (defined below) being Smart Zones (mainly adopted in the leisure sector, including US (particularly in pubs and gaming)) and Smart Machines (mainly adopted in the vending sector (particularly in vending machines)) supported by Corporate/Technology costs.
The products/services offered by each operating segment are:
Smart Zones: design, product development, sale and rental of fluid monitoring equipment, data insights and related services
Smart Machines: design product development, sale and rental of machine monitoring equipment, data insights and related services.
Corporate/Technology: Centralised Group overheads along with technology related costs for the Group
The inter-segment sales are immaterial. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated assets and liabilities comprise items such as cash and cash equivalents, certain intangible assets, taxation, and borrowings. Segment capital expenditure is the total cost incurred during the year to acquire segment assets that are expected to be used for more than one period.
The segmental results for the six months ended 30 September 2017 are as follows:
Continuing Operations Smart Smart Corporate/Technology
Zones Machines Total
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- -------- ----------- ----------------------- --------
Total revenue 5,662 1,052 - 6,714
------------------------------- -------- ----------- ----------------------- --------
Profit/(loss) before
amortisation, share
based payments and
exceptional costs 2,270 473 (1,040) 1,703
------------------------------- -------- ----------- ----------------------- --------
Pre-exceptional segment
result 2,185 318 (1,217) 1,286
Exceptional costs (229) (161) 2 (388)
------------------------------- -------- ----------- ----------------------- --------
Post exceptional
segment result 1,956 157 (1,215) 898
Finance income - - 7 7
Finance costs (6) - - (6)
Profit/(loss) before
taxation 1,950 157 (1,208) 899
Taxation (287)
------------------------------- -------- ----------- ----------------------- --------
Profit for the year
from continuing operations 612
------------------------------- -------- ----------- ----------------------- --------
Smart Smart Corporate/Technology
Zones Machines Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------- -------- ----------- ----------------------- --------
Segment assets 24,888 - 4,007 28,895
Unallocated assets 173 - - 173
--------------------------- -------- ----------- ----------------------- --------
Total assets 25,061 - 4,007 29,068
--------------------------- -------- ----------- ----------------------- --------
Segment liabilities 4,384 - 336 4,720
Unallocated liabilities 395 - - 395
--------------------------- -------- ----------- ----------------------- --------
Total liabilities 4,779 - 336 5,115
--------------------------- -------- ----------- ----------------------- --------
The asset base of the Vianet Group plc cannot be split across Smart Zones, Smart Machines or Technology, so has been allocated to Smart Zones.
Notes to the interim report (continued)
The segmental results for the six months ended 30 September 2016 are as follows:
Continuing Operations Smart Smart Corporate/Technology
Zones Machines Total
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- -------- ----------- ----------------------- --------
Total revenue 5,866 1,191 - 7,057
------------------------------- -------- ----------- ----------------------- --------
Profit/(loss) before
amortisation, share
based payments and
exceptional costs 2,385 448 (1,195) 1,638
------------------------------- -------- ----------- ----------------------- --------
Pre-exceptional segment
result 2,313 272 (1,318) 1,267
Exceptional costs (68) - (67) (135)
------------------------------- -------- ----------- ----------------------- --------
Post exceptional
segment result 2,245 272 (1,385) 1,132
Finance income - - 5 5
Finance costs (8) - - (8)
Profit/(loss) before
taxation 2,237 272 (1,380) 1,129
Taxation (330)
------------------------------- -------- ----------- ----------------------- --------
Profit for the year
from continuing operations 799
------------------------------- -------- ----------- ----------------------- --------
Smart Smart Corporate/Technology
Zones Machines Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------- -------- ----------- ----------------------- --------
Segment assets 25,438 - 3,715 29,153
Unallocated assets 152 - - 152
--------------------------- -------- ----------- ----------------------- --------
Total assets 25,590 - 3,715 29,305
--------------------------- -------- ----------- ----------------------- --------
Segment liabilities 4,709 - 384 5,093
Unallocated liabilities - - - -
------------------------- -------- ----------- ----------------------- --------
Total liabilities 4,709 - 384 5,093
--------------------------- -------- ----------- ----------------------- --------
The asset base of the Vianet Group plc cannot be split across Smart Zones, Smart Machines or Technology, so has been allocated to Smart Zones.
Notes to the interim report (continued)
The segmental results for the 12 months ended 31 March 2017 are as follows:
Continuing Operations Smart Smart Corporate/Technology
Zones Machines Total
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- -------- ----------- ----------------------- --------
Total revenue 11,935 2,328 - 14,263
------------------------------- -------- ----------- ----------------------- --------
Profit/(loss) before
amortisation, share
based payments and
exceptional costs 4,822 891 (2,398) 3,315
------------------------------- -------- ----------- ----------------------- --------
Pre-exceptional segment
result 4,677 539 (2,800) 2,416
Exceptional costs (325) (25) (614) (964)
------------------------------- -------- ----------- ----------------------- --------
Post exceptional
segment result 4,352 514 (3,414) 1,452
Finance income - - - -
Finance costs (17) - 12 (5)
Profit/(loss) before
taxation 4,335 514 (3,402) 1,447
Taxation (417)
------------------------------- -------- ----------- ----------------------- --------
Profit for the year
from continuing operations 1,030
------------------------------- -------- ----------- ----------------------- --------
Smart Smart Corporate/Technology
Zones Machines Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------- -------- ----------- ----------------------- --------
Segment assets 25,350 - 3,787 29,137
Unallocated assets 460 - - 460
--------------------------- -------- ----------- ----------------------- --------
Total assets 25,810 - 3,787 29,597
--------------------------- -------- ----------- ----------------------- --------
Segment liabilities 4,584 - 357 4,941
Unallocated liabilities 395 - - 395
--------------------------- -------- ----------- ----------------------- --------
Total liabilities 4,979 - 357 5,336
--------------------------- -------- ----------- ----------------------- --------
The asset base of the Vianet Group plc cannot be split across Smart Zones, Smart Machines or Technology, so has been allocated to Smart Zones.
Notes to the interim report (continued)
4. Exceptional items
6 months 6 months Year
Ended Ended Ended
30 Sept 30 Sept 31 March
2017 2016 2017
GBP'000 GBP'000 GBP'000
Exceptional costs 388 135 864
388 135 864
------------------- ------------ --------- ---------
Exceptional costs principally relate to employee transition costs and corporate transaction costs.
5. Tax
The charge for tax is based on the profit for the period and comprises:
6 months 6 months Year
Ended Ended Ended
30 Sept 30 Sept 31 March
2017 2016 2017
GBP'000 GBP'000 GBP'000
United Kingdom corporation
tax 287 330 417
----------------------------- --------- --------- ---------
The tax charge reflects the utilisation of brought forward trading losses, which had previously been recognised as a deferred tax asset, against the taxable profit for the period within Vianet Limited
6. Earnings per share
Earnings per share has been impacted by the reversal of a deferred tax asset provision realised in previous years.
Basic earnings per share are calculated by dividing the earnings attributable to ordinary shareholders (GBP612k) by the weighted average number of ordinary shares outstanding during the period.
Diluted earnings per share are calculated on the basis of profit for the year after tax divided by the weighted average number of shares in issue in the year plus the weighted average number of shares which would be issued if all the options granted were exercised
The table below shows the earnings pre and post the impact of the movement in the deferred tax asset.
30 September 2017 30 September 2016
Earnings Basic Diluted Earnings Basic Diluted
earnings earnings earnings earnings
per share per share per share per share
GBP000 GBP000
Pre-tax profit
attributable
to equity shareholders 899 3.29p 3.27p 1,129 4.14p 4.11p
Post-tax profit
attributable
to equity shareholders 612 2.24p 2.23p 799 2.93p 2.91p
Pre-tax, pre-exceptional
profit attributable
to equity shareholders 1,287 4.71p 4.68p 1,264 4.63p 4.61p
Post-tax, pre-exceptional
profit attributable
to equity shareholders 1,000 3.66p 3.64p 934 3.42p 3.40p
30 Sept 30 Sept
2017 2016
Number Number
Weighted average number of ordinary
shares 27,302,694 27,302,694
Dilutive effect of share options 184,041 142,164
------------------------------------- ----------- -----------
Diluted weighted average number
of ordinary shares 27,486,735 27,444,858
------------------------------------- ----------- -----------
7. Business combinations after the reporting period
On 3 October 2017, the group acquired 100% of the share capital of Vendman Systems Limited for a total consideration of GBP4.0 million, comprising cash of GBP1.9 million and estimated contingent consideration of GBP2.1 million that will become payable by January 2019 and January 2020.
Principal reasons for the acquisition have been covered in the Executive Review.
The assets acquired from Vendman Systems Limited were as follows. As the acquisition took place after the end of the accounting period, the directors have yet to complete their initial accounting. Accordingly the book and fair values presented below are provisional and goodwill is not presented separately from other intangibles that may be identified.
Provisional
book and
provisional
fair value
GBP'000
Non-current assets 155
Trade and other receivables 479
Cash and cash equivalents 11
Trade and other payables (513)
Borrowings (74)
-------------------------------- -------------
Total identifiable assets 58
Goodwill and other intangibles 3,946
-------------------------------- -------------
Total consideration 4,004
-------------------------------- -------------
During the period to 30 September 2017, Vendman Systems Limited recorded turnover of GBP1,015,095 and an operating profit before exceptional items of GBP104,191.
INDEPENDENT REVIEW REPORT TO VIANET GROUP PLC
Introduction
We have been engaged by the company to review the financial information in the half-yearly financial report for the six months ended 30 September 2017 which comprises the consolidated statement of comprehensive income, the consolidated balance sheet, the summarised consolidated cash flow statement, the statement of changes in equity and the related explanatory notes. We have read the other information contained in the half yearly financial report which comprises only the Chairman's Statement, and the Chief Executive and Chief Financial Officer Review and considered whether they contain any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
This report is made solely to the company in accordance with guidance contained in ISRE (UK and Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of the Entity'. Our review work has been undertaken so that we might state to the company those matters we are required to state to them in a review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusion we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The AIM rules of the London Stock Exchange require that the accounting policies and presentation applied to the financial information in the half-yearly financial report are consistent with those which will be adopted in the annual accounts having regard to the accounting standards applicable for such accounts.
As disclosed in note 2, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The financial information in the half-yearly financial report has been prepared in accordance with the basis of preparation in note 2.
Our responsibility
Our responsibility is to express to the company a conclusion on the financial information in the half-yearly financial report based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the financial information in the half-yearly financial report for the six months ended 30 September 2017 is not prepared, in all material respects, in accordance with the basis of accounting described in note 2.
GRANT THORNTON UK LLP
AUDITOR
LEEDS
4 December 2017
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR USONRBBAURAA
(END) Dow Jones Newswires
December 05, 2017 02:00 ET (07:00 GMT)
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