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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| TruSpine Technologies Plc | AQSE:TSP | Aquis Stock Exchange | Ordinary Share | GB00BMZCKL55 | Ordinary shares |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.60 | 1.50 | 1.70 | 1.60 | 1.60 | 1.60 | 0.00 | 06:42:32 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:2092Q
Telspec PLC
26 September 2003
26 September 2003
Telspec plc
Interim Results for the six months ended 30 June 2003 (Unaudited)
Divestment of Switch Division to Teligent AB
Proposed move to the Alternative Investment Market
Financial summary
Half Year Half Year Full Year
2003 2002 2002
#'000 #'000 #'000
Turnover 15,569 21,689 40,426
Operating profit 22 632 1,095
Profit before taxation 38 573 1,046
Basic earnings per ordinary share (pence) 0.09 1.41 2.55
Highlights
* Breakeven achieved despite significant fall in sales;
* Strict attention to capital employed and cash management;
* Switch Division to be sold to Teligent for #1.2m, with future earn out
potential;
* Telspec now focused solely on Access products;
* Decision to move listing to AIM market;
* Board and management changes.
Commenting on the results the retiring Chairman, Peter Espenhahn, said:
"The group will continue its strategy of being an innovative provider of
Intelligent Solutions, based solely on our Access product range. The
restructuring will allow us to focus our R&D, manufacturing and sales efforts
whilst continuing to maintain our drive on cost efficiency within the business.
However, due to the time involved in developing new international markets and
with the continuing slow nature of the worldwide market, we expect the level of
sales to remain depressed and the trading result to be significantly lower for
the second half of the year.
We will maintain a strong emphasis on new product development and we believe
that we are well positioned to benefit from an upturn in global markets as a
much leaner, fitter and more focused organisation."
Enquiries:
Telspec plc
Martin Parmenter
Tel: +44 (0) 1634 687133
Citigate Dewe Rogerson Credit Lyonnais Securities
Seb Hoyle / Toby Mountford Simon Bennett / Chris Crawford
Tel: +44 (0) 207 638 9571 Tel: +44 (0) 207 588 4000
Chairman's Statement
Group Results
The Group profit before tax was #38,000 for the first six months of the year
(2002 1st half: #573,000). Turnover for the half year was #15.57m (2002 1st
half: #21.69m). Basic earnings per ordinary share were 0.09p (2002 1st half:
1.41p). There is no interim dividend.
Despite the significant reduction in turnover, management of costs has delivered
a breakeven after incurring #188,000 in restructuring costs. The reduction in
turnover from the same period last year is principally attributable to the fall
in sales of Access Products which were down by 33% to #13.27m (2002 1st half:
#19.78m). Sales of Switch Products at #2.3m remained similar. The worldwide
market for telecommunication equipment has remained weak.
R&D expenditure levels have been maintained, as has the policy of expensing such
costs as they are incurred.
Operations
Network Access Products
The TelMax product portfolio continues to expand with the first samples of our
new Broadband variants (2Mbit line extender and Ethernet in the local loop)
planned for early 2004. Sales of TelMax during the first half were #7.5m (2002
1st half: #10m) with the shortfall being largely accounted for by a drop in
sales to South America due to the timing of bid cycles. Egypt continues to be a
key market, sales in Eastern Europe remain strong and the Siemens OEM agreement
is also producing sales.
Access sales to BT in the UK declined by 44%, compared to the first half of
2002, to #5.3m. The majority of this decline was attributable to the Highway
product. BT has now begun selling Mid Band, which offers broadband to rural
areas, using a new version of Highway.
The disappointing decision by BT not to take eNode, which we announced in
February 2003, not only affects shipments in the second half and subsequent
periods but has also narrowed our product portfolio. We have increased our
efforts to reverse this trend both through self developed and third party
sourced products.
Switching Products
Sales of switching products in the first half of 2003 were #2.3m compared with
#1.9m for the equivalent period last year.
Working Capital
We continued to give attention to capital employed and cash management during
the first half. The constant focus on inventories has delivered a further
#0.62m reduction since last year end. The Group cash position improved from
#1.66m to #2.23m.
Move to AIM
The board has decided to seek a move to the Alternative Investment Market of the
London Stock Exchange following the disposal of the switching products division.
The Board considers this market to be more appropriate for the company given
its size and shareholder base.
Sale of Switching Products Division to Teligent AB
Agreement has been reached to sell Telspec's Switch Business to Teligent AB, a
Swedish telecommunications company specialising in Intelligent Network solutions
and services for fixed and mobile telecoms operators. Completion is expected to
be on 30 September 2003. The consideration for the disposal is #1.2m payable in
cash on completion in respect of the fixed assets, Intellectual Property Rights
and goodwill of the Switch Business and an additional amount of up to #0.8m
depending on performance for 42 months after completion. The net book value of
these assets is expected to be #0.4m at completion. The Switch business made a
loss before taxation of approximately #0.4m for the six months ended 30 June
2003. Telspec will supply manufactured parts to Teligent.
The sale proceeds will be applied to the continued development of the Access
Business.
The Board
I have decided to retire from the Board with immediate effect and Michael Lacey,
who has been a non-executive director since 2001, will replace me as Chairman.
The CEO, Magnus Braxell, will leave the Group to return to Sweden to work for
Teligent AB on the integration of the Switch business following the purchase by
Teligent. On behalf of the Board I would like to thank Magnus for his
significant contribution to Telspec during a difficult period. Martin Parmenter
will act as interim CEO until a replacement is announced.
Dean Phillips has retired from the Board as a non-executive Director.
In May 2003, Jeff May was appointed to the Board as Group Sales & Marketing
Director, to further strengthen the Group's drive to develop new marketing
initiatives. Jeff has been with the company for 6 years and has over 20 years
experience in the Telecoms Industry.
Staff
I want to thank all our employees for their enormous contribution to the group,
and in particular for the diligence and spirit displayed in what has been
another testing trading period.
Outlook
The group will continue its strategy of being an innovative provider of
Intelligent Solutions, based solely on our Access product range. The
restructuring will allow us to focus our R&D, manufacturing and sales efforts
whilst continuing to maintain our drive on cost efficiency within the business.
However, due to the time involved in developing new international markets and
with the continuing slow nature of the worldwide market, we expect the level of
sales to remain depressed and the trading result to be significantly lower for
the second half of the year.
We will maintain a strong emphasis on new product development and we believe
that we are well positioned to benefit from an upturn in global markets as a
much leaner, fitter and more focused organisation.
Peter Espenhahn
26 September 2003
Group Profit and Loss Account
For the six months ended 30 June 2003
6 months ended 6 months ended Year ended
30 June 2003 30 June 2002 31 December 2002
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Note
Turnover 15,569 21,689 40,426
Operating profit 22 632 1,095
Net interest receivable/(payable) 16 (59) (49)
Profit on ordinary activities before taxation 38 573 1,046
Taxation - UK 2 - - -
Taxation - Overseas 2 - - (12)
Profit on ordinary activities after taxation 38 573 1,034
Profit attributable to shareholders 38 573 1,034
Retained profit for the period 38 573 1,034
Basic earnings per ordinary share (pence) 3 0.09 1.41 2.55
Diluted earnings per ordinary share (pence) 3 0.09 1.40 2.53
The turnover and operating profit of the Group are derived wholly from
continuing operations.
Group Balance Sheet
As at 30 June 2003
30 June 2003 30 June 2002 31 December 2002
(unaudited) (unaudited) (audited)
#'000 #'000 #'000 Fixed
Assets
Tangible fixed assets 3,919 4,825 4,494
Investments 17 17 17
3,936 4,842 4,511
Current Assets
Stocks 2,267 3,748 2,889
Debtors 6,589 8,153 6,423
Cash at bank and in hand 2,225 1,289 1,662
11,081 13,190 10,974
Creditors - amounts falling due within one year (5,138) (8,712) (5,898)
Net current assets 5,943 4,478 5,076
Total assets less current liabilities 9,879 9,320 9,587
Provisions for liabilities and charges (1,194) (1,232) (1,070)
Net assets 8,685 8,088 8,517
Capital and Reserves
Called up share capital 10,125 10,125 10,125
Share premium account 10,419 10,419 10,419
Revaluation reserve 681 702 687
Surplus of nominal value of shares issued over
nominal value of shares acquired (6,930) (6,930) (6,930)
Other reserves 18 21 18
Capital redemption reserve 340 309 295
Profit and loss account (deficit) (5,968) (6,558) (6,097)
Equity shareholders' funds 8,685 8,088 8,517
Group Cash Flow Statement
For the six months ended 30 June 2003
6 months ended 6 months ended Year ended
30 June 2003 30 June 2002 31 December 2002
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Note
Cash inflow from operating activities 4 456 2,146 3,190
Returns on investments and servicing of 16 (59) (49)
finance
Capital expenditure and financial investments (181) (89) (562)
Cash inflow before financing 291 1,998 2,579
Financing
- issue of shares - 1 1
- increase/(decrease) in debt 53 (21) (83)
Net cash inflow/(outflow) from financing 53 (20) (82)
Increase in cash in the period 344 1,978 2,497
Reconciliation of net cash flow to movement in
net funds
Increase in cash in the period 344 1,978 2,497
Cash (inflow)/outflow from decrease in debt
and net lease financing (53) 21 83
Change in net funds resulting from cash flows 291 1,999 2,580
Translation differences 219 60 (86)
Movement in net funds in the period 510 2,059 2,494
Net funds/(debt) at beginning of the period 1,302 (1,192) (1,192)
Net funds at end of the period 5 1,812 867 1,302
Notes to the Interim Statement
For the six months ended 30 June 2003
1. Basis of preparation
The interim financial information has been prepared on the basis of accounting
policies consistent with those adopted for the year ended 31 December 2002. The
interim financial information has not been audited and does not constitute
statutory accounts.
The comparative results for this period present an abridged version of the full
accounts for the year ended 31 December 2002, which received an unqualified
audit report, and which have been filed with the Registrar of Companies.
This interim report does not comprise statutory accounts within the meaning of
section 240 of the Companies Act 1985.
2. Taxation
There is no tax charge for the period due to the utilisation of brought forward
tax losses. No deferred tax asset has been recognised.
3. Basic and diluted earnings per ordinary share
Basic earnings per share is based upon the weighted average of 40,500,615 (2002:
40,499,244) ordinary shares in issue during the period and is calculated on the
profit on ordinary activities after taxation and minority interests of #38,000
(2002: #573,000).
The diluted weighted average number of ordinary shares in issue at 30 June 2003
is 40,500,615 (2002: 40,992,787) giving a diluted earnings per ordinary share
of 0.09 pence. (2002: 1.40 pence).
4. Reconciliation of operating profit to operating cash flows
6 months ended 6 months ended Year ended
30 June 2003 30 June 2002 31 December 2002
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Operating profit 22 632 1,095
Depreciation charges 701 703 1,491
Loss on disposal of fixed assets 68 30 42
Loss on disposal of dormant subsidiaries - - 40
Decrease in stocks 652 448 1,278
(Increase)/decrease in debtors (145) (492) 1,261
(Decrease)/increase in creditors (842) 825 (2,017)
Net cash inflow from operating activities 456 2,146 3,190
Notes to the Interim Statement (continued)
For the six months ended 30 June 2003
5. Analysis of net funds
At 1 Jan 2003 Cash flow Exchange movements At 30 June 2003
#'000 #'000 #'000 #'000
Cash at bank and in hand 1,662 344 219 2,225
Net cash total 1,662 344 219 2,225
Less:
Loans due within one year (330) (83) - (413)
Finance leases (30) 30 - -
Total net funds 1,302 291 219 1,812
Independent Review Report to Telspec plc
Introduction
We have been instructed by the company to review the financial information for
the six months ended 30 June 2003 which comprises the profit and loss account,
the balance sheet, the cash flow statement and related notes 1 to 5. We have
read the other information contained in the interim report and considered
whether it contains any apparent misstatements or material inconsistencies with
the financial information.
This report is made solely to the company in accordance with Bulletin 1999/4
issued by the Auditing Practices Board. Our work has been undertaken so that we
might state to the company those matters we are required to state to them in an
independent 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
conclusions we have formed.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The directors are
responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be consistent
with those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of Group management and applying
analytical procedures to the financial information and underlying financial data
and based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions.
It is substantially less in scope than an audit performed in accordance with
United Kingdom
auditing standards and therefore provides a lower level of assurance than an
audit. Accordingly, we do not express an audit opinion on the financial
information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2003.
Deloitte & Touche LLP
Chartered Accountants
Crawley
Date: 26 September 2003
This information is provided by RNS
The company news service from the London Stock Exchange
END
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