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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Allied Minds Plc | LSE:ALM | London | Ordinary Share | GB00BLRLH124 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 13.85 | 10.05 | 12.65 | 0.00 | 00:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:2719N
Alphameric PLC
08 July 2003
Alphameric plc
("Alphameric" or the "Group")
Interim Results for the six months ended 31 May 2003
Alphameric, the information technology solutions provider to the retail sector,
is pleased to announce Interim Results for the six months ended 31 May 2003.
Highlights
* Results are in line with the trading update published on 3 June
* The Retail Betting and Hospitality Divisions performed well
* The Retail Division's performance was disappointing, primarily a
consequence of retailers' deferral of IT expenditure in the light of uncertain
economic conditions and the introduction of "Chip and Pin"
* The Group made good progress towards higher quality and long term
repetitive revenue and profit streams
* Profit before tax, goodwill amortisation and exceptional
administrative expenses was #189,000. The loss before tax after goodwill
amortisation and exceptional administrative expenses was #2.7 million
* The Group remains financially strong, with positive operating cash
flow before exceptional administrative expenses for the period of #3.2 million
and free net cash at 31 May of #10.5 million
* 8% increase in dividend per share to 0.65p per share
Commenting on outlook, Rodney Hornstein, Chairman, said:
"The Group has a strong balance sheet and is generating significant levels of
free cash flow. We continue to focus on our cost base, streamlining operations
and reducing overheads where appropriate. In addition to the sound performance
by the Retail Betting and Hospitality Divisions, over the last few weeks we have
seen some upturn in the activity of our Retail Division.
"The Group is committed to growing high quality revenues, both organically and
by selective acquisitions, from a strong customer base across all of its
divisions. Our drive towards increasing the proportion of Group revenues that
comes from long term, repetitive revenue contracts has gained momentum,
particularly with the recent successes in our Retail Betting and Hospitality
Divisions, and positions us well for the future."
- ends -
For further information, please contact:
Alphameric plc
Alan Morcombe, Chief Executive Today: 020 7067 0700
Martin Randall, Finance Director Thereafter: 01483 293971
Weber Shandwick Square Mile
Nick Oborne / Susanne Walker 020 7067 0700
Alphameric plc
("Alphameric" or the "Group")
Interim Results for the six months ended 31 May 2003
CHAIRMAN'S STATEMENT
Introduction
Results for the six months ended 31 May 2003 are in line with the trading update
we published on 3 June.
While I am pleased to be able to report that both our Retail Betting and
Hospitality Divisions met their sales and profit targets in the first half of
this financial year, our Retail Division fell short of its targets for the
period. As a consequence the Group's results overall for the six months to 31
May 2003 were disappointing.
We believe the dip in the performance of the Retail Division is temporary and
primarily the result of retailers' deferral of expenditure on new information
technology, brought about by the uncertain trading environment they experienced
in the first few months of 2003.
Results
Turnover for the six months to 31 May 2003 was broadly unchanged at #27.2
million (2002: #27.3 million). Two factors have influenced this: first, the
underperformance of the Retail Division, already mentioned; second, the
development of our strategy to progressively shift our business model to selling
a greater proportion of long term, repetitive revenue contracts. The benefit of
this strategy is that it delivers more stable and increasing revenue and profit
streams into the future; conversely however, it does mean that less revenue and
profit is booked in the year when the contract is first entered into. We believe
that this move to longer term and generally higher margin contracts should over
time increase revenue and profits overall.
The lack of significant levels of new retail software sales and the shift in the
product mix sold resulted in a fall in the Group's overall gross margin. This
resulted in a small operating profit for the period, before amortisation of
goodwill and exceptional administrative expenses, of #40,000 ( 2002: #3.1
million).
Earnings per share, before exceptional items and amortisation of goodwill, for
the six months to 31 May 2003 were 0.1 pence per share (2002: 2.3 pence per
share). FRS 3 earnings per share showed a loss of 2.5 pence per share (2002:
earnings 0.2 pence per share).
Exceptional items relate to the integration of Crown, acquired last year, with
the Group's historic hospitality business, and a reduction in headcount and
premises as part of our continuing focus on the cost base of our businesses.
The Group's balance sheet remains strong with a positive operating cash flow,
before exceptional administrative expenses, of #3.2 million (2002: #4.0 million)
and a closing free net cash position for the Group at 31 May 2003 of #10.5
million (30 November 2002: #13.2 million). The decrease in the level of cash
reflects, as expected, the payment of tax and last year's increased final
dividend, together with #1.3 million of capital expenditure on Fixed Odds
Betting Terminals for rental by the Retail Betting Division.
Dividend
An interim dividend of 0.65 pence per share (2002: 0.6 pence per share) will be
payable on 14 August 2003 to holders of record on 18 July 2003.
Retail Division
Against a background of poor trading conditions in the first half of the
financial year, our Retail Division continued to consolidate its position as the
first choice provider of end-to-end solutions for high-street retailers. Our
Darwin suite of software is now fully operational in two retail chains,
Dunelm and Sports Soccer. We anticipate that the substantial investment we have
made to create this modern highly effective software solution for retailers will
be a major source of revenue over the coming years. The division's current
prospect list remains strong.
Performance was primarily held back by a lack of consumer confidence resulting
in lower high street spending and the corresponding deferral of our customers'
IT decisions. The impending changes to the way retailers accept credit card
payments in the future, through the use of "Chip and Pin" technology, has also
slowed the decision making process to install new EPoS systems.
The Chip and Pin programme requires retailers to modify their tills and install
additional hardware and software capable of accepting the new payment cards,
encrypted with a personal identification number (PIN), by 1 January 2005. The
program for testing and accepting UK approved Chip and Pin solutions is
currently underway through a trial in the Northampton area, in which Alphameric
is participating. The Group is well placed to provide retailers with the
hardware and software they will require and we anticipate good levels of new
business as retailers look to install compliant systems ahead of the 2005 date.
Retail Betting Division
Our Retail Betting Division performed strongly throughout the period, winning
good levels of business from existing customers and adding important new
customers. We continue to secure orders for our bookmaking display systems and
our patented bet capture and settlement solutions from all areas of the
marketplace.
A major strategic aim of our Bookmaking Division has been to smooth its revenue
and profit stream by increasing the volume and value of the repetitive revenue
business that it secures. We have made good progress in this respect through the
sale of solutions that include ongoing software licence and maintenance fees,
the sale of long term bureau services, where we provide turnkey solutions to
bookmakers, and through the rental of our Fixed Odds Betting terminals, where we
generate regular fixed income and take a percentage share in the operators'
retained earnings. This move from upfront sales of capital equipment will
benefit the Group in the medium to long term but does, however, reduce the short
term revenue and profit that can be delivered.
We remain confident that the strength of our Retail Betting Division's position
will see it continue to perform well and take full advantage of the
opportunities that emerge through the progressive liberalisation of the UK
betting and Gaming legislation.
Hospitality Division
Our Hospitality Division performed well in the first half of the financial year,
winning good levels of business from a range of customers including pub
operators and restaurant chains.
Our web based ERP system (Caterwide) has been very well received by the
marketplace, where its long-term benefits have been quickly appreciated. We have
recently added The Deep Pan Pizza Company to the growing list of users for
Caterwide on a five year contract whereby we provide a turnkey managed solution
for the estate of over fifty restaurants.
A typical Caterwide customer contracts for a turnkey service over a five to
seven year term, including the provision of EPoS hardware and software in the
hospitality outlets along with a central system, hosted by Alphameric, capable
of producing new product orders, monitoring stock, analysing and producing
payroll, processing daily transactions and producing management information.
This solution outsources our clients' burden of running a centralised system and
is very cost efficient.
Alphameric Hospitality is already a leader in the provision of web based ERP
systems. It is ideally placed to win a growing share of the business that will
be generated over the next few years as the larger hospitality organisations
replace legacy systems that are unable to cope with the ever increasing demands
from their businesses.
Logistics
As shareholders are aware, the Group's logistics operation has for some time
been seeking a partner that can provide the business with the geographical reach
and operational critical mass to take the business forward. Progress in this
respect is ongoing and we anticipate being able to announce our intentions in
this area of our business in the near future.
Outlook
Alphameric has an outstanding set of class leading products across all of its
areas of operations, an excellent reputation for providing high quality,
reliable end-to-end solutions and an impressive list of customers.
The Group has a strong balance sheet and is generating significant levels of
free cash flow. We continue to focus on our cost base, streamlining operations
and reducing overheads where appropriate. In addition to the sound performance
by the Retail Betting and Hospitality Divisions, over the last few weeks we have
seen some upturn in the activity of our Retail Division.
The Group is committed to growing high quality revenues, both organically and by
selective acquisitions, from a strong customer base across all of its divisions.
Our drive towards increasing the proportion of Group revenues that comes from
long term, repetitive revenue contracts has gained momentum, particularly with
the recent successes in our Retail Betting and Hospitality Divisions, and
positions us well for the future.
Rodney Hornstein
8 July 2003
ALPHAMERIC PLC
Consolidated Profit and Loss Account
For the six months ended 31 May 2003
Unaudited Unaudited
6 months 6 months
ended ended
31-May-03 31-May-02
Note #' 000 #' 000
Turnover 2 27,254 27,373
--------- ---------
Operating costs
Operating costs excluding amortisation
of goodwill and exceptional
administrative expenses (27,214) (24,253)
Exceptional administrative expenses 3 (463) -
Goodwill (2,430) (2,154)
--------- ---------
(30,107) (26,407)
--------- ---------
Operating profit before amortisation of
goodwill and exceptional administrative
expenses 40 3,120
Amortisation of goodwill and exceptional
administrative expenses (2,893) (2,154)
Operating (loss)/profit 2 (2,853) 966
Net interest receivable 149 131
--------- ---------
(Loss)/profit on ordinary activities before
taxation (2,704) 1,097
Tax on (loss)/profit on ordinary
activities 4 69 (910)
--------- ---------
(Loss)/profit on ordinary activities after
taxation (2,635) 187
Dividends 5 (679) (615)
--------- ---------
Retained loss for the period (3,314) (428)
========= =========
Earnings per share
Basic 6 (2.5p) 0.2p
Before amortisation of goodwill and
exceptional administrative expenses 6 0.1 p 2.3p
Diluted - 0.2p
The group has no recognised gains or losses other than the losses above and
therefore no separate statement of total recognised gains and losses has been
presented.
There is no difference between the (loss)/profit on ordinary activities before
taxation and the retained loss for the periods stated above, and their
historical cost equivalents.
ALPHAMERIC PLC
Consolidated Balance Sheet
As at 31 May 2003
Unaudited Unaudited Audited
31-May-03 31-May-02 30-Nov-02
Note #' 000 #' 000 #' 000
Fixed assets
Intangible assets 77,284 76,269 79,684
Tangible assets 8,478 6,360 7,210
--------- --------- ---------
85,762 82,629 86,894
--------- --------- ---------
Current assets
Stocks 6,494 7,631 6,105
Debtors 22,126 26,044 29,370
Cash held to secure loan notes 3,644 7,937 4,851
Cash at bank and in hand 10,526 15,010 13,208
--------- --------- ---------
42,790 56,622 53,534
Creditors
(amounts falling due within
one year) (24,085) (30,425) (32,647)
--------- --------- ---------
Net current assets 18,705 26,197 20,887
--------- --------- ---------
Total assets less current
liabilities 104,467 108,826 107,781
Creditors
(amounts falling due after more than
one year) (479) (651) (479)
--------- --------- ---------
Net assets 103,988 108,175 107,302
========= ========= =========
Capital and reserves
Called up share capital 2,614 2,563 2,614
Shares to be issued 858 1,035 858
Share premium account 99,776 98,450 99,776
Merger reserve 12,099 12,099 12,099
Profit and loss account (11,359) (5,972) (8,045)
--------- --------- ---------
Total equity shareholders' funds 7 103,988 108,175 107,302
========= ========= =========
ALPHAMERIC PLC
Consolidated Cash Flow Statement
For the six months ended 31 May 2003
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
31-May-03 31-May-02 30-Nov-02
Note #' 000 #' 000 #' 000
Net cash inflow from operating items 8
before exceptional administrative
expenses 3,206 4,009 11,146
Exceptional administrative expenses (683) - -
--------- --------- ---------
Net cash inflow from operating items 2,523 4,009 11,146
Returns on investment and servicing
of finance 149 120 279
Taxation (1,284) (803) (2,357)
Capital expenditure and financial
investment (2,188) (323) (1,870)
Acquisitions and disposals - (1,372) (6,712)
Equity dividends paid (1,882) (1,025) (1,640)
--------- --------- ---------
Net cash (outflow)/inflow before
financing (2,682) 606 (1,154)
Financing - - (42)
--------- --------- ---------
(Decrease)/increase in cash in the year (2,682) 606 (1,196)
--------- --------- ---------
ALPHAMERIC PLC
Notes to the Interim Financial Statements
For the six months ended 31 May 2003
1. Basis of reporting
The foregoing financial information does not constitute statutory accounts
within the meaning of section 240 of the Companies Act 1985.
The interim financial statements for the period ended 31 May 2003, which are
unaudited, have been prepared on the basis of the accounting policies set out
in the Group's statutory accounts for the year ended 30 November 2002 and
were approved by a duly appointed and authorised Committee of the Board of
Directors on 7 July 2002.
The statutory accounts for the year ended 30 November 2002 were audited,
carried an unqualified audit report and did not contain statements under
section 237(2) or (3) of the Companies Act 1985. They have been filed with
the Registrar of Companies.
2. Segmental analysis
Unaudited Unaudited
6 months 6 months
ended ended
Turnover by Class of Business 31-May-03 31-May-02
#' 000 #' 000
Retail Betting 11,778 12,386
---------- ----------
Retail 10,059 12,577
---------- ----------
Hospitality 4,332 1,050
---------- ----------
Logistics 1,085 1,360
---------- ----------
27,254 27,373
---------- ----------
Operating profit/(loss) by Class of Business
Before
exceptional
administrative
expenses & Exceptional Before
amortisation of administrative amortisation of Amortisation
goodwill expenses goodwill of goodwill Unaudited Unaudited
6 months 6 months
ended ended
31-May-03 31-May-02
#' 000 #' 000
Retail Betting 792 - 792 (222) 570 2,336
Retail (656) (278) (934) (1,776) (2,710) (807)
Hospitality 203 (144) 59 (432) (373) (197)
Logistics (299) (41) (340) - (340) (366)
--------- --------- --------- --------- ---------- ----------
40 (463) (423) (2,430) (2,853) 966
--------- --------- --------- --------- ---------- ----------
--------- --------- --------- --------- ---------- ----------
3. Exceptional administrative expenses
Exceptional administrative expenses relate to the integration of the Group's
hospitality business, previously based in York, with Crown Management Systems,
acquired last year. In addition a number of sites have been closed as part of
a restructuring process so as to reduce the number of locations from which
the Group operates. Further costs have arisen from a reduction in the Group's
headcount.
4. Tax on profit on ordinary activities
Unaudited Unaudited
6 months 6 months
ended ended
31-May-03 31-May-02
#' 000 #' 000
United Kingdom corporation tax at 30% (2002: 30%) 82 (910)
Adjustment in respect of previous periods (13) -
---------- ----------
Tax on (loss)/profit on ordinary activities 69 (910)
========== ==========
The tax credit for the period is based on the expected tax charge for the full
year to 31 November 2003 of 25%.
5. Dividends
An interim dividend of 0.65p per share (2002:0.6p) will be paid for the
period ended 31 May 2003, amounting to #679,772 (period ended 31 May 2002:
#615,162).
6. (Loss)/earnings per share
Basic (loss)/earnings per share is calculated by dividing the (loss)/earnings
attributable to ordinary shareholders by the weighted average number of
ordinary shares in issue during the period as follows:
Unaudited Unaudited
6 months 6 months
ended ended
31-May-03 31-May-02
(Loss)/Earnings (#'000) 2,635.0 187.0
Weighted average shares in issue (m) 104.5 102.5
---------- ----------
Basic (loss)/earnings per share (p) (2.5) 0.2
========== ==========
Earnings per share before goodwill amortisation and exceptional administrative
expenses have been presented in addition to the earnings per share as defined in
FRS 14 since, in the opinion of the Directors, this provides shareholders with a
more meaningful representation of the earnings derived from the Group's
businesses. It can be reconciled from basic earnings per share as follows:
Unaudited Unaudited
6 months 6 months
ended ended
31-May-03 31-May-02
Per share Per share
amount (p) amount (p)
Basic earnings per share (2.5) 0.2
Amortisation of goodwill 2.3 2.1
Exceptional administrative expenses 0.4 -
Taxation in respect of exceptional administrative
expenses (0.1) -
---------- ----------
Earnings per share before amortisation of goodwill
and exceptional administrative expenses 0.1 2.3
========== ==========
7. Reconciliation of movement in shareholders' funds
Unaudited Audited
6 months Year
ended ended
31-May-03 30-Nov-02
#' 000 #' 000
(Loss)/profit for the period (2,635) 7
Dividends (679) (2,497)
Share capital issued - 51
Share premium arising on share issues - 1,326
Reduction in contingent share capital to be issued - (227)
---------- ----------
Net change in shareholders' funds (3,314) (1,340)
Opening shareholders' funds 107,302 108,642
---------- ----------
Closing shareholders' funds 103,988 107,302
---------- ----------
8. Reconciliation of operating profit/(loss) to operating cash flows
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
31-May-03 31-May-02 30-Nov-02
#' 000 #' 000 #' 000
Operating (loss)/profit (2,853) 966 2,216
Amortisation of goodwill 2,430 2,154 6,545
Exceptional administrative expenses 463 - -
-------- --------- --------
Operating profit before amortisation of
goodwill & exceptional administrative expenses 40 3,120 8,761
Depreciation on tangible fixed assets 920 884 2,201
(Increase)/decrease in stocks (389) (869) 399
Decrease in debtors 7,243 5,911 3,994
(Decrease)/increase in creditors (4,608) (5,037) (4,209)
-------- --------- --------
Net cash inflow from operating activities
before exceptional administrative expenses 3,206 4,009 11,146
-------- --------- --------
9. Circulation to shareholders
A copy of the interim financial statements will be posted to all shareholders
of the Company and further copies will be available from the Company's
Registered Office at Bishopsgate House, Broadford Park, Shalford, Guildford,
Surrey, GU4 8ED.
10.Corporate website
Further information on the Group and its activities can be found on the
corporate website at www.alphameric.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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