We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register to chat with like-minded investors on our interactive forums.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Apc Technology Group Plc | LSE:APC | London | Ordinary Share | GB0000373984 | ORD 2P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 9.875 | 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
TIDMAPC
RNS Number : 5939K
APC Technology Group PLC
17 December 2018
17 December 2018
APC TECHNOLOGY GROUP PLC
("APC",the "Company" or the "Group")
Final Results for the year ended 31 August 2018
APC Technology Group PLC (AIM: APC), the provider of design, specification and distribution services for specialist electronic components and systems, lighting technologies and connectivity products, is pleased to announce its audited results for the year ended 31 August 2018.
Financial highlights
-- Post-tax profit GBP0.6m (2017:GBP0.2m), significantly higher than prior year -- Earnings per share 0.5p, up from 0.1p in 2017 -- EBITDA GBP1.15m, up from GBP0.8m in 2017 -- Operating profit GBP0.9m, up from GBP0.5m in the prior year -- Revenue from continuing operations GBP17.1m (2017: GBP15.6m) -- Gross profit, before exceptional and non-recurring expenses GBP5.7m (2017: GBP5.4m) -- Gross margin, before exceptional and non-recurring expenses 33.1% (2017: 34.9%)
-- Share placing and subscription in July 2018 to fund acquisitions, raising GBP2.9m (net of expenses) in new equity for the Group
-- Year-end cash balances increased from GBP0.4m to GBP0.8m and net debt decreased to GBP2.7m (2017: GBP3.1m)
Operational highlights
-- Acquisition of First Byte Micro Limited ("FBM") in January 2018, to enhance Locator offering
-- Acquisition of Aspen Electronics Limited ("Aspen") in July 2018, to enhance RF and Microwave business
Hot Features
Premium
-- Sale of investment in Open Energy Market in January 2018, to concentrate on core activities
-- Orders taken in the year ("bookings") GBP16.5m (excluding Aspen), an increase of 3.1%
-- Annualised bookings run rate in 2018 for the enlarged Group GBP22.5m, representing a healthy book to bill ratio for future growth
-- Order highlights include:
o USD 1.0m repeat order for components for a defence aviation radar system
o GBP1.0m new order for Counter-IED technology components
o GBP4.1m of lighting orders in the year, up from GBP2.6m in 2017
o First order (GBP0.2m) of a series for smart buildings technology
-- Business development highlights:
o Minimise Energy re-branded APC Lighting
o APC Lighting and APC Smartwave IoT technology combined to offer integrated Property Technology services to property and facility management companies
o Year-on-year APC Locator orders increased tenfold with FBM acquisition
o Radio Frequency (RF) team augmented and refocused following Aspen acquisition
o UK and Ireland distribution deal for 3D PLUS microelectronics products for space applications
o UK distribution deals signed with Oregano Systems and Seven Solutions (White Rabbit systems) to boost APC's time synchronisation business
o APC salesforce increased to leverage wider market opportunities
Tony Lochery, Chairman of APC, commented:
"2018 has been a transformational year for APC. We have significantly increased the scale and profitability of the business and this means that we can offer an even greater value added service to our technology partners and our customers. We will continue to pursue our three-faceted growth strategy of selling more of the technology and products that we have with our enlarged sales force, of signing new proven technology partners and through strategic bolt-on acquisitions.
We would like to thank our staff, shareholders and suppliers for their continued support over the past year."
Enquiries
APC Technology Group PLC +44 (0) 330 313 3220
Richard Hodgson, Chief Executive www.apcplc.com
Michael Thompson, Finance Director
Stockdale Securities Limited (Nominated Adviser and Broker) +44 (0)20 7601 6100
Mark Brown / Antonio Bossi / Edward Thomas
STRATEGIC REPORT AND OPERATIONS REVIEW
The Directors are pleased to present their Statutory Strategic Report for APC Technology Group PLC ("the Company") and its subsidiary undertakings (together "the Group") for the year ended 31 August 2018, together with a review of the Group's operations during the year.
Principal activities
The principal activity of the Group and Company during the year was the design, specification and distribution of specialist electronic components and systems, lighting technologies and connectivity products to the defence, aerospace, industrial, real estate, logistics and healthcare sectors.
Review of the year
The year ended 31 August 2018 has seen further progress in developing the Group's strategy of concentrating on our core strengths, the design, specification and distribution of specialist electronic products, components and systems. The Group has also seen a full year's benefit from the restructuring in 2016 and 2017, including the consolidation of the Finance and other Group functions in Rochester, resulting in a reduction in overheads.
The benefits of this strategy are reflected in our results for the year and we are pleased to be reporting an increased pre-tax profit of GBP555,000 (2017: GBP166,000) together with a further improvement in our cash flow. More details on our improved financial performance are set out in the Financial Results section of this Report.
In addition, the Board has strengthened the financial position of the Group in several ways:
-- The supportive relationship with ABN has been further enhanced, as their continuing GBP6 million invoice discounting facility has been augmented by an Enterprise Finance Guarantee loan of GBP500,000.
-- The creditor invoice financing facility with Pay4 Limited has been increased from GBP400,000 to GBP600,000.
-- A share placing and subscription raised a total of GBP3.0 million before expenses in July 2018, at a price of 6.75p per Ordinary Share, a premium of approximately 2% over the mid-market price prevailing at the time.
More details on these financing measures are dealt with in the funding and cash flow section of this Report.
The Group has continued with the three core elements of its growth strategy:
-- Increased revenue through our established and growth technologies: our sales teams have been reorganised and incentivised to operate more proactively in hunting down orders.
-- Growth by signing new proven technology partners matching our core competencies.
-- Sales growth through bolt-on acquisitions in complementary technologies, to provide additional revenue, and an additional bank of existing customers and to leverage the Group central functions.
During the year the Group made two acquisitions in furtherance of this strategy:
In January 2018 the Group completed the acquisition of First Byte Micro Limited ("FBM") for a net consideration of GBP0.5m, details of which are set out in note 6 below. FBM sources and supplies a wide range of electronic components from major blue chip manufacturers such as Altera, Seiko Instruments, Texas Instruments, and Cypress, and from others either directly under franchise or from authorised open market and worldwide sources. This acquisition provides a platform for a significant boost for APC Locator's business and FBM has now been rebranded APC Locator.
In July 2018 the Group acquired Aspen Electronics Limited ("Aspen") for a net consideration of GBP2.2 million, details of which are set out in note 6 below, funded by a combination of part of the proceeds of a share placing and subscription and the issue of 7,407,407 Ordinary Shares that are subject to a lock-in. Aspen is a premium distributor of electronic components, specialising in a wide range of radio frequency (RF) and microwave components and test and measurement equipment. The RF and Microwave business is complementary to APC's existing business, which the Board expects will lead to top-line synergy opportunities. In addition, Aspen has in-house component testing facilities, which allow it to provide enhanced value-added services to customers and suppliers. It also distributes own brand products and has an online sourcing business for lower value RF and microwave components.
As part of the realignment of the Group's activities, the Board also made the decision in January 2018 to sell the Group's 15% stake in Open Energy Market Limited ("OEM"), a company specialising in energy procurement. The Board had concluded that this activity was not core to the Group's business and a new equity partner was coming into OEM on terms that would have created a significant risk of APC not being able to achieve a successful exit from this investment. The proceeds of sale amounted to GBP307,000.
Review of continuing operations
Following the restructuring that took place in 2016, the Group continues to trade as a design, specification and distribution business, comprising individual sales-led teams with specialist areas of expertise that adopt common marketing, sales and post-sale processing standards. This combination maximises the opportunity for technical sales professionals to be incentivised to grow their focus area in an entrepreneurial way, whilst following a consistent framework. The teams have specialist expertise, allowing them to monitor technological advancements, major projects, legislation and industry needs. APC predominately designs-in and distributes high reliability, highly durable and long lifespan components and systems for critical applications, with customers often paying a premium for this high performance, high specification technology.
The UK electronic components market is currently worth EUR1.6bn per annum and growing (Source: IDEA/ECSN/AFDEC), APC is focused on growth market sectors.
During the year under review the Group made two acquisitions and added further authorised manufacturer distribution relationships, in order to strengthen the technology offering and gain access to wider markets to enable the teams to leverage their skills and expertise.
The activities of each of the teams, together with their progress in the year, is discussed below:
High Reliability Electronic Components
APC's Hi-Rel team specialises in the design-in of high reliability, high temperature and high voltage components into projects within the defence, aerospace, space and high-end industrial sectors. Operating to AS9120B aerospace quality standards for component distribution, APC is an authorised UK distributor for market-leading global manufacturers. Its engineer-led, technical sales team secures the design-in of electronic components within a finished system, aircraft or vehicle, often resulting in long-term recurring revenue from continued production.
In January 2018 it expanded its product portfolio to address the UK's growing space market (worth GBP13.7 billion in 2015 and forecast to reach GBP40 billion in 2030. Source: UK Space) with the appointment by 3D PLUS S.A., a premium manufacturer of space qualified advanced high density microelectronics products, including cameras. In the nine months since signing, APC has secured orders of EUR130,000, with 2019 orders forecast at EUR600,000. The turnaround of the oil and gas market has resulted in orders in excess of $100,000 for high temperature capacitors for a downhole application.
RF and Microwave Components
Sales of APC's radio frequency (RF) and microwave components remain buoyant, with orders placed within the financial year up 13% in comparison to 2017. Major Orders were secured for an international aircraft project and the Group's Counter-IED business remains strong with contracts totalling in excess of GBP1m. In July 2018, APC acquired Aspen Electronics Limited, a leading distributor of RF and microwave components into the military, telecoms, wireless and broadband markets. Aspen brings an additional 50 authorised product lines and 10 customer facing sales staff; with significant opportunity for synergy and cross-selling across APC and Aspen's client base. Defence orders remain strong with a $1m order for components for counter IED equipment.
Embedded Computing and Displays
APC is a Premier Channel Partner for the number one global manufacturer of embedded computer boards, industrial PCs and displays used in applications within defence, oil and gas, medical, transport, kiosks and industrial machinery. In addition APC has a range of complementary embedded and asset tracking products and components. The embedded product team has achieved project design wins for a wind turbine application and an above ground oil project with revenues expected in 2019, in addition to ongoing billings from existing design projects within equipment manufacturing, intrinsically safe computing equipment and military communication systems.
Component Sourcing Solutions
APC's component buyers and engineers have historically supported customers by sourcing obsolete or hard-to-find components and providing component level testing and processes. In January 2018, APC acquired First Byte Micro Ltd, an authorised and independent distributor of electronic components with a strong customer base of industrial equipment manufacturers and two decades of expertise. Leveraging its network of authorised open market sources for components, APC Locator delivers quick turn business within APC's client base, providing components from multiple high profile global manufacturers in addition to APC's portfolio of authorised distribution product lines. Within the first six months of trading it delivered GBP1m of bookings compared to a run rate of GBP1.5m per annum prior to acquisition.
Time and Frequency Synchronisation
APC Time provides systems to synchronise time and frequency across critical IT networks within financial trading institutions, broadcast, telecoms, power and data centres. As the UK and Ireland representative for one of the top three global timing system manufacturers, APC Time has experienced 30% compound annual growth since 2016, driven by technology changes and compliance requirements in key markets.
APC Time has continued its expansion, both through a focus on the growth markets of finance and broadcast and the signing of proven, complementary switching and antenna technology partners, enabling them to provide customers with a more complete solution.
Following the implementation of MiFID II regulations in January 2018, the financial trading sector continues to drive APC Time orders as institutions seek to improve their technology solutions and demonstrate ongoing compliance. Within the broadcast sector, technology changes are driving growth. The BBC has chosen APC's technology as the preferred time synchronisation technology across its major IP infrastructure upgrades. As a well-known industry innovator, the BBC's endorsement may well drive further adoption of APC's product portfolio within the sector.
Lighting Technologies
APC's lighting team delivers project-based lighting solutions, from lighting design and product specification through to supply, installation and lighting commissioning. APC Lighting predominately operates through preferred supplier agreements with property and facilities management (FM) companies that manage property portfolios including commercial real estate, education, public sector, retail and leisure. Currently the team has four preferred supplier relationships worth circa GBP1m per annum and are in discussion with a further ten FM providers.
Working with global FM CBRE, APC Lighting has completed lighting upgrades at the Genting Arena events and exhibition venue in the Midlands, Morgan Stanley offices at Canary Wharf, Spitalfields Market, Birmingham NEC and at the Tower 42 skyscraper in London. Within the retail sector, working with both a retail real estate and a car park facilities company, they have upgraded lighting within retail venues in Maidstone, Paisley, Morecambe and Bexley.
Sensors and connectivity
As part of APC's property technologies offering, APC Smartwave specialises in providing the property and facilities management sector with the sensors, controls and technologies to create connected workspaces, improve employee wellbeing and drive cost savings through energy management and predictive maintenance. In 2018 APC Smartwave has supplied a range of smart building sensors that detect desk occupancy, temperature, humidity and other environmental conditions into offices within The Shard, the Deloitte building and most recently for use in a leading supermarket's London headquarters. In addition to operating through FM providers, APC has undertaken a major project with Network Rail Wales to a provide legionella compliance system to 76 remote trackside buildings, negating the need for manual monitoring by Network Rail staff.
Performance Management
Trading as EEVS, APC provides advisory and performance analysis services for clients undertaking energy efficiency projects within public sector, government, healthcare, education and the private sector. EEVS provides consultancy services to prove the financial return on energy efficiency investments, manage the risk of funded projects and set in place strong governance and supplier accountability structures between their customer and its suppliers.
This year, EEVS continued work on the Scottish Government's public sector energy performance contracting framework, developing performance measurement plans and reporting, with further public sector work with RF:FIT Cymru and the European Commission funded QualitEE project. EEVS continues to deliver quarterly assurance services for major facilities management based energy performance contracts for Lloyds Banking Group and Vodafone.
Financial results
Group revenue from continuing operations for the financial year was GBP17,149,000 (2017: GBP15,564,000). Gross profit (excluding exceptional and non-recurring expenses) was GBP5,681,000 this year (2017: GBP5,431,000), representing a gross margin of 33.1% compared with 34.9% last year. The small decrease was mainly attributable to the mix of products, but the effect of this was offset by the lower overhead base achieved by the restructuring in 2016 and 2017. The operating profit, before exceptional and other non-recurring costs, of GBP1,078,000 was up 43% on the GBP756,000 achieved in 2017.
This reflected a full year's benefit from last year's significant cost-cutting programme, as a result of which underlying operating overheads in 2018 were 7.5% less than in 2017 (after taking account of last year's GBP307,000 write-back of the investment in Open Energy Market Limited) despite the two acquisitions made in the year.
Profit before tax from continuing operations for the year improved from GBP166,000 in 2017 to GBP555,000 this year. The post-tax profit for the year improved from GBP192,000 in 2017 to GBP633,000 this year and earnings per share improved from 0.1p to 0.5p.
Funding and cash flow
In the financial year, there was a cash outflow from operating activities of GBP288,000, a significant improvement on the outflow of GBP719,000 in 2017. The Group ended the year with a gross cash balance of GBP777,000 (2017: GBP377,000). Like-for-like trade and other payables (excluding acquisitions in the year) reduced by GBP748,000.
The Group's net debt at 31 August 2018 was GBP2,688,000 (2017: GBP3,101,000), excluding the loan notes that had matured before the year-end and had been repaid by the date of this Report. The Group has an invoice discounting facility with ABN Amro of up to GBP6,000,000, of which GBP2,261,000 had been drawn down at the year-end (2017: GBP2,502,000). ABN has demonstrated considerable support for the business since the facility was established in early 2015. The facility itself continues with no fixed termination date and during the year was augmented by an additional loan of GBP500,000 under the Enterprise Finance Guarantee scheme. In addition, the Group had a trade payment credit facility with Pay4 Limited of GBP600,000, which was fully utilised at 31 August 2018.
In July 2018, the Board authorised a share placing and subscription by existing and new investors and Board members, for a total of 44,970,998 Ordinary Shares, as follows:
(a) 37,563,591 Ordinary Shares, at 6.75 pence per share, to raise approximately GBP2.54 million before expenses. These measures further strengthened the balance sheet, while enabling the Group's loan notes to be repaid either immediately or over several months, with all matured loan notes paid off by the end of November 2018.
(b) 7,407,407 shares were issued to the vendors of Aspen Electronics Limited. These shares, combined with part of the proceeds of the above placing, formed the net consideration of GBP2.2 million paid to the vendors of Aspen Electronics Limited.
The placing price of 6.75 pence per share represents a premium of approximately 2% above the mid-market price of the shares prevailing at the time.
On the basis of current financial projections and available funds and facilities, the Directors are satisfied that the Group and parent company have adequate resources to continue in operation for the foreseeable future. The Directors therefore continue to adopt the going concern basis of accounting when preparing the financial statements, as described more fully in the Directors' Report and the note on accounting policies in the financial statements.
Board of Directors and senior management
Throughout the year under review the composition of the Board remained unchanged, consisting of the Non-executive Chairman and three Executive Directors. The Group was therefore able to benefit from a full year of continuity.
Outlook
Last year we reported that the Group would pursue three main growth strategies:
-- growth through increased bookings and billings from its existing and high growth technologies;
-- growth through the signing of new complementary product lines; and -- growth through targeted bolt-on acquisitions.
The past year has been one of overlaying this growth strategy over the base achieved through the restructuring carried out in 2016 and 2017. This has resulted in an increase in the Group's profit for the year.
The year has already seen satisfying progress in these areas, with a restructuring and investment in the new sales team, with two acquisitions completed and with additional franchises added to broaden our offering. The Board is confident that the Group is on track to deliver on its medium term growth strategy and to continue to realise further profitable growth.
Given that the Group essentially connects rest of world, including European, suppliers with UK manufacturers, the Board is cognisant of the wider macro-economic factors which may impact the business model in the short term, as a result of the Brexit negotiations. Whilst the Group is not currently experiencing any such issues, the Board is keeping the situation under continuous review and will update the market in the event of any significant changes.
The Board would once again like to thank our management, staff and advisers for their enthusiasm, hard work, professionalism, dedication and commitment to the Group, and to express our appreciation and thanks to our suppliers, partners and shareholders for their continued support.
Tony Lochery Richard Hodgson Michael Thompson Phil Lancaster
Non-executive Chairman Chief Executive Finance Director
Business Development Director
14 December 2018
CONSOLIDATED STATEMENT OF INCOME
For the year ended 31 August 2018
2018 2017
Exceptional
Results and Results Exceptional
from non-recurring from and non-recurring
operations expenses Total operations expenses Total
(Note (Note
3) 3)
Note GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Revenue 2 17,149 - 17,149 15,564 - 15,564
Cost of sales (11,468) - (11,468) (10,133) (24) (10,157)
Gross profit 5,681 - 5,681 5,431 (24) 5,407
Administrative
expenses (4,571) (128) (4,699) (4,637) (228) (4,865)
Operating profit
before share
based
payments and
acquisition
costs 1,110 (128) 982 794 (252) 542
Share based
payments (32) - (32) (38) - (38)
Operating
profit/(loss) 1,078 (128) 950 756 (252) 504
Financing costs 4 (395) - (395) (338) - (338)
Profit before
taxation 683 (128) 555 418 (252) 166
Taxation credit 78 - 78 26 - 26
Profit for the
year
attributable
to the equity
holders
of the parent 761 (128) 633 444 (252) 192
=========== ================ ======== =========== ================= ========
Earnings per share from continuing and discontinued operations attributable to the equity holders of the parent during the year.
2018 2017
Basic earnings per
share 5
From profit for the
year 0.5p 0.1p
===== =====
There were no other items of comprehensive income. Accordingly, no consolidated statement of comprehensive income has been prepared.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 August 2018
2018 2017
GBP000 GBP000
------------------------------- --------- ---------
Non-current assets
Intangible assets 9,126 7,378
Property, plant and
equipment 564 55
Associates and financial
assets - 307
9,690 7,740
--------- ---------
Current assets
Inventories 1,330 832
Trade and other receivables 4,133 2,985
Current tax asset 73 -
Cash and cash equivalents 777 377
6,313 4,194
--------- ---------
Total assets 16,003 11,934
--------- ---------
Current liabilities
Trade and other payables (4,375) (4,332)
Borrowings (3,820) (3,478)
(8,195) (7,810)
--------- ---------
Total assets less current
liabilities 7,808 4,124
Non-current liabilities
Deferred tax (110) -
Net assets 7,698 4,124
========= =========
Equity attributable
to the equity holders
of the parent
Called-up share capital 3,597 2,698
Share premium account 14,890 13,232
Share option reserve 308 297
Merger reserve 4,987 4,635
Retained earnings (16,084) (16,738)
Total equity 7,698 4,124
========= =========
Consolidated statement of Changes in Equity
Attributable to the equity holders of the parent
---------------------------------------------------------------------
Share
Share option
Share premium valuation Merger Translation Retained
capital account reserve reserve reserve earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------- ------- --------- ------- ----------- ---------- ------
At 31 August 2016 2,556 12,895 548 4,635 (10) (17,219) 3,405
------- ------- --------- ------- ----------- ---------- ------
Profit for the year - - - - - 192 192
Other comprehensive income - - - - - - -
------- ------- --------- ------- ----------- ---------- ------
Total comprehensive income
for the year - - - - - 192 192
------- ------- --------- ------- ----------- ---------- ------
Transactions with equity
holders of the parent
Issue of new shares 142 337 - - - - 479
Share option charge - - (251) - - 289 38
Non-controlling interest
disposed - - - - 10 - 10
142 337 (251) - 10 289 527
------- ------- --------- ------- ----------- ---------- ------
At 31 August 2017 2,698 13,232 297 4,635 - (16,738) 4,124
------- ------- --------- ------- ----------- ---------- ------
Profit for the year - - - - - 633 633
Other comprehensive income - - - - - - -
------- ------- --------- ------- ----------- ---------- ------
Total comprehensive income
for the year - - - - - 633 633
------- ------- --------- ------- ----------- ---------- ------
Attributable to the equity holders of the parent
Share
Share option
Share premium valuation Merger Translation Retained
capital account reserve reserve reserve earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------- ------- --------- ------- ----------- ---------- ------
Transactions with equity
holders of the parent
Issue of new shares 899 1,784 - 352 - - 3,035
Costs associated with share
issue - (126) - - - - (126)
Share option charge - - 11 - - 21 32
899 1,658 11 352 - 21 2,941
------- ------- --------- ------- ----------- ---------- ------
At 31 August 2018 3,597 14,890 308 4,987 - (16,084) 7,698
------- ------- --------- ------- ----------- ---------- ------
ConSolidated statement OF CASH FLOWS
For the year ended 31 August 2018
Group Group
2018 2017
GBP000 GBP000
--------------------------------------------- -------- --------
Reconciliation of cash flows from operating
activities
Profit/(loss) before
taxation including discontinued
operations for the financial
year 554 166
Loss on write-off of
investment in associates - -
Gain on revaluation
of other investment - (307)
Finance costs 395 338
Taxation receipts 111 26
Depreciation of property,
plant and equipment 43 90
(Increase)/decrease
in inventories (76) 248
(Increase)/decrease
in trade and other receivables (136) 766
(Decrease)/Increase
in trade and other payables (1,211) (2,084)
Share-based payments
charge 32 38
Net cash used in operating
activities (288) (719)
-------- --------
Cash flows from investing
activities
Acquisition of property,
plant and equipment (5) (13)
(Acquisition)/sale of
subsidiary undertakings;
net of cash acquired (1,971) 641
Sale of other investment 307 -
Net cash from investing
activities (1,669) 628
-------- --------
Cash flows from financing
activities
Finance income - -
Finance costs (395) (338)
Proceeds of share issue
(net of associated costs) 2,409 479
Finance leases (4) (21)
Increase/(decrease)
in short-term borrowings 447 (96)
Increase/(decrease)
in loan notes (100) -
Net cash from financing
activities 2,357 24
-------- --------
Increase/(decrease)
in net cash 400 (67)
-------- --------
Cash and cash equivalents
as at 1 September 377 444
Increase/(decrease)
in net cash 400 (67)
Cash and cash equivalents
as at 31 August 777 377
======== ========
NOTES TO THE CONSOLIDATED FINANCIAL INFORMATION
1. Basis of preparation
Statement of compliance
This financial information has been prepared under the historical cost convention, as modified by the revaluation of certain financial assets at fair value, as required by IAS 39 'Financial Instruments: Recognition and Measurement'. This financial information has been prepared in accordance with the recognition and measurement principles of IFRS as adopted by the European Union and on the same basis as the accounting policies adopted in the financial statements for the year ended 31 August 2018, but does not contain sufficient information to comply with IFRS as adopted by the European Union.
Going concern basis of accounting
The financial information has been prepared on a going concern basis, as management believes the Group will be able to meet its liabilities as they fall due.
In the financial year, there was a cash outflow from operating activities of GBP288,000, a significant improvement on the outflow of GBP719,000 in the previous year. Following last year's improvement in the Group's speed of discharging its liabilities, the current period saw a smaller further reduction in trade and other payables. Operating cash flow was also influenced positively by the Group's increased profitability and working capital cycle. The cash requirement of the Group was funded partly by trading, partly by improved working capital management and partly by a share issue to new and existing shareholders and Board members in July 2018. This raised a total of GBP2,909,000, of which GBP2,433,000 represented the consideration for the acquisition of Aspen Electronics Limited, leaving net proceeds of GBP476,000 to strengthen the Balance sheet.
These factors enabled a further reduction of GBP1.2 million in amounts due to suppliers and other creditors, while the Group's cash balances increased from GBP377,000 in 2017 to GBP777,000 this year The Group's matured loan notes have also been paid off in full since the financial year-end.
Management has examined going concern against a detailed profit, working capital, and cash flow forecast to 31 December 2019, which reflects the matters discussed in the preceding paragraph but does not reflect any additional share placings, new debt facilities, nor sale of any assets other than in the normal course of business. Based upon this review, the continuation of the GBP6,000,000 invoice discounting facility with ABN, which has no fixed termination date, agreement of extended payment terms with suppliers as necessary, and other prudent working capital management, the Board believes that the Group will continue to be able to meet its liabilities as they fall due. Management also has the ability to raise capital through issuance of additional loan notes, further private share placings, or sale of additional assets if required.
2. Revenue and segmental information
Operating segments
IFRS 8 'Operating Segments', requires consideration of the chief operating decision maker ("CODM") within the Group. In line with the Group's internal reporting framework and management structure, the key strategic and operating decisions are made by the CEO, who reviews internal monthly management reports, budget and forecast information as part of this process.
Accordingly, the CEO is deemed to be the CODM.
The Company has determined that it has only a single reportable segment, being the design, specification and distribution of specialist electronic components and systems.
The Group had one customer representing over 10% of revenue (2017: none).
Revenue by product and service
2018 2017
GBP000 GBP000
----------------------- -------- ------- -------
Electronic Components 12,603 11,214
LED Lighting 3,765 3,504
Consulting 781 846
------- ---------
17,149 15,564
======= =======
Revenue by geographic location
2018 2017
GBP000 GBP000
UK 16,685 15,216
North America 140 82
Europe and Asia 324 266
------- -------
17,149 15,564
======= =======
3. Exceptional and non-recurring expenses
2018 2017
GBP000 GBP000
Corporate re-organisation - compromise agreements
and redundancy costs 37 399
Corporate re-organisation - professional
fees 91 68
Corporate re-organisation - dilapidations
and onerous lease provisions - 57
Corporate re-organisation - third party creditors - (335)
Costs associated with aborted contract - 24
Foreign exchange loss arising from unprecedented
market volatility - 39
128 252
======= =======
Exceptional items are items that, by virtue of their nature and incidence, have been disclosed separately in order to draw them to the attention of the reader of the financial information. These costs are deemed as exceptional as they do not represent normal trading activities of the business.
4. Finance costs
2018 2017
GBP000 GBP000
Financing costs
Other interest payable 265 174
Other finance costs 130 164
---- ----
395 338
==== ====
5. Earnings per share
The calculation of basic earnings per share is based on the profit after taxation attributable to equity holders of the parent company for the period and the weighted average number of shares in issue during the period.
Diluted earnings per share is calculated by adjusting the weighted average number of shares outstanding by the dilutive effect of Ordinary Shares that the Company may potentially issue relating to its share option scheme.
Earnings per share on operating profit, before exceptional costs, share based payments and loss on discontinued operations, are considered to be the most realistic measure of earnings and the calculation is based on the weighted average number of shares.
The result for the year and the weighted average number of shares used in the calculations are set out below:
2018 2017
GBP000 GBP000
Earnings attributable to equity holders
of the parent 633 192
------------ --------
Weighted average number of
shares (thousands) 139,472 130,326
Dilutive/free shares 917 917
------------ ------------
Diluted number of
shares 140,389 131,243
------------ ------------
Earnings per share 0.5p 0.1p
-------- ------------
6. Acquisitions in the year
Business combinations are accounted for using the acquisition accounting method as at the acquisition date, which is the date at which control is transferred to the Group. Goodwill is measured at the acquisition date as the fair value of consideration, less the recognised amount of the identifiable assets and liabilities assumed, in accordance with the accounting policy definition set out in the Accounting Policy notes.
Acquisition of First Byte Micro Limited
On 10 January 2018 the Group acquired 100% of the share capital of First Byte Micro Limited ("FBM") a company incorporated in England, whose principal activity is acting as a franchised and independent distributor of electronic components. The purchase consideration consists of GBP1.2 million, of which GBP0.7 million represents cash at completion in FBM. Of the remaining GBP0.5 million, GBP0.27 million was paid in cash on completion and the residual GBP0.23 million will be paid 12 months after completion. Contingent consideration is payable to the previous owner remaining with the business for growth in profitability over and above that acquired. At the year-end no contingent consideration has been provided for as determination of such requires a full year trading to be completed.
As a result of the acquisition, the Group will have gained a significant capability in the sourcing of hard to find, obsolete and end-of life components, products and systems.
Eight months' trading has been included in the consolidation, contributing GBP251,000 revenue and GBP140,000 profit before tax. Full period results show revenue of GBP251,000 and a loss before tax of GBP21,000.
Acquisition of Aspen Electronics Limited
On 26 July 2018 the Group acquired 100% of the share capital of Aspen Electronics Limited, whose principal activity is acting as a premium distributor of electronic components, specialising in radio frequency (RF) and microwave components and test and measurement equipment. The net consideration consisted of GBP2.4 million, satisfied partly in Ordinary Shares in APC and partly in cash.
The RF and Microwave business is complementary to APC's existing business, which the Board expects will lead to top-line synergy opportunities. In addition, Aspen has in-house component testing facilities, which allow it to provide enhanced value-added services to key customers and suppliers.
One month's trading has been included within the consolidated group results. Revenue of GBP466,000 and a profit before tax of GBP53,000 has been recognised. Full year results show revenue of GBP5.3 million and a profit before tax of GBP106,000.
Recognised amounts of identifiable assets acquired and liabilities assumed.
First
Byte Aspen
Micro Electronics
Limited Limited
GBP000 GBP000
Cash and cash equivalents 718 986
Tangible fixed assets - 550
Inventory 36 387
Trade and other receivables 130 881
Trade and other payables (213) (707)
Deferred taxes - (110)
671 1,987
Goodwill 553 1,195
--------- -------------
Total purchase consideration 1,224 3,182
========= =============
Analysed as follows:
First
Byte Aspen
Micro Electronics
Limited Limited
GBP000 GBP000
Initial cash consideration 276 1,460
Cash acquired 718 963
Vendor ordinary shares - 259
New shares in APC Technology
Group PLC - 500
Deferred consideration 230 -
Total acquisition cost 1,224 3,182
========= =============
New shares in APC Technology Group PLC were issued to the vendor at the placing price of 6.75p per share.
The fair value of the financial assets includes receivables with a fair value of GBP856,000. The best estimate at the acquisition date of the contractual cashflows potentially not collectible is GBP85,000.
Acquisition related costs of GBP69,000 have been charged to exceptional costs in the consolidated income.
The assessment of the fair value of assets and liabilities acquired remains under review and subject to change under the completion mechanism of the Sale and Purchase Agreement.
7. Publication of non-statutory accounts
The financial information set out in this announcement does not constitute the statutory financial statements for the year ended 31 August 2018 and the year ended 31 August 2017 in accordance with section 434 of the Companies Act 2006 but is derived from those accounts.
The financial statements for the years ended 31 August 2017 and 31 August 2018 were prepared in accordance with IFRS as adopted by the European Union and those for the year ended 31 August 2017 have been delivered to the Registrar of Companies. The financial statements for the year ended 31 August 2018 will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The auditor's reports on both financial statements were unqualified, did not include references to any matters to which the auditor drew attention by way of emphasis without qualifying their report and did not contain statements under sections 498(2) or (3) of the Companies Act 2006.
The full audited financial statements of APC Technology Group PLC for the year ended 31 August 2018 are expected to be posted on Friday 25 January 2019 to those shareholders who have elected to receive hard copies. They will also be available to the public at the Company's registered office, 6 Stirling Park, Laker Road, Rochester, Kent, ME1 3QR and available to view on the Company's website at www.apcplc.com from the date of posting.
8. Annual General Meeting
The Annual General Meeting of the Company will be held on Friday 22 February 2019 at 11.00 a.m. at the offices of the Company's auditors, RSM UK Audit LLP, 25 Farringdon Street, London EC4A 4AB.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
FR DZLFFVLFXFBF
(END) Dow Jones Newswires
December 17, 2018 02:00 ET (07:00 GMT)
1 Year Apc Technology Chart |
1 Month Apc Technology Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
