Interim Results

 

TIDMBCT 
 
RNS Number : 8861Z 
Business Control Solutions Grp PLC 
30 September 2009 
 
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30 September 2009 
 
 
BUSINESS CONTROL SOLUTIONS GROUP PLC 
 
 
Interim results 
 
 
Business Control Solutions Group plc (the "Group" or the "Company") (BCT.L), the 
AIM listed provider of consultancy and software control solutions to the 
financial services sector announces its unaudited interim results for the six 
months ended 30 June 2009. 
 
 
+----------------------+--------------+--------------+ 
|                      |   Six months |   Six months | 
|                      |   to 30 June |   to 30 June | 
|                      |         2009 |         2008 | 
|                      |      GBP'000 |      GBP'000 | 
+----------------------+--------------+--------------+ 
| Revenue              |        4,497 |        4,548 | 
+----------------------+--------------+--------------+ 
| Gross profit         |        1,263 |        1,564 | 
+----------------------+--------------+--------------+ 
| (Loss) / Profit      |        (414) |           29 | 
| before tax           |              |              | 
+----------------------+--------------+--------------+ 
| Adjusted* loss       |        (434) |        (263) | 
| before tax           |              |              | 
+----------------------+--------------+--------------+ 
| (Loss) / Profit per  |       (0.2)p |         0.0p | 
| share                |              |              | 
+----------------------+--------------+--------------+ 
| Cash                 |        1,994 |        2,308 | 
+----------------------+--------------+--------------+ 
* Adjusted for capitalisation and amortisation 
 
 
Financial Highlights: 
 
 
  *  Group turnover down 1%: 
    *  Consulting revenues up 0.4% 
    *  Software revenues down 11% 
 
  *  Recurring revenues up to 90% of Software revenue (2008: 65%) 
  *  Adjusted loss before tax after removing the impacts of development cost 
  capitalisation and amortisation GBP434,000 (H1 2008: loss of GBP263,000) 
  *  Strong cash position of GBP2.0m (H1 2008: GBP2.3m) 
 
 
 
Operating Highlights: 
 
· Consulting division: 
 
 o Proved its resilience in a challenging market 
 
- Q1 revenues down 5% on prior year but Q2 revenues up 8% 
 
o Consultancy utilisation rate continues at above 85% 
        o Now actively 
hiring 
 
· Software division: 
 
 

       o Next version of our strategic product Arc 
now live at two Tier 1 banks 
        o Investment continues in enhancing the 
functionality of both Integrity and Arc 
        o Recurring revenues up 23% 
 
 
Possible delisting from AIM 
  *  Board currently considering merits of continuing with AIM listing 
 
 
 
Commenting on the results, Nigel Walder, CEO of Business Control Solutions Group 
plc said: 
 
 
"The first half of the year has seen us face up to extremely challenging market 
conditions. Our Consulting business, after a disappointing first quarter, in 
which sales declined, saw strong growth in Q2 as we saw increased demand for our 
services. In response to this increased demand we are now looking to recruit at 
varying levels within the division.  In our Software business, interest in our 
core strategic technology products, Integrity and Arc remains strong.  We 
continue to face lengthening sales cycles as our prospective customers wrestle 
with the need for increased control and their own internal budgetary pressures. 
Even so, given our strong market position and sales pipeline, we 
remain cautiously confident about the outlook for the remainder of the year." 
 
 
Ends 
 
 
 
 
 
 
For further information, please contact: 
 
 
+--------------------------------------+----------+------------------------+ 
| Business Control Solutions Group plc |          | 0207 648 2050          | 
+--------------------------------------+----------+------------------------+ 
| Nigel Walder, CEO                    |          |                        | 
+--------------------------------------+----------+------------------------+ 
| Roger Shepherd, Finance Director     |          |                        | 
+--------------------------------------+----------+------------------------+ 
|                                      |          |                        | 
+--------------------------------------+----------+------------------------+ 
| Financial Dynamics Limited           |          | 0207 831 3113          | 
+--------------------------------------+----------+------------------------+ 
| James Melville-Ross                  |          |                        | 
+--------------------------------------+----------+------------------------+ 
| Haya Chelhot                         |          |                        | 
+--------------------------------------+----------+------------------------+ 
|                                      |          |                        | 
+--------------------------------------+----------+------------------------+ 
| Arbuthnot Securities Limited         |          | 020 7012 2000          | 
+--------------------------------------+----------+------------------------+ 
| Tom Griffiths                        |          |                        | 
+--------------------------------------+----------+------------------------+ 
 
 
 
 
Chairman's Statement 
 
 
We began the year facing a good deal of uncertainty.  The financial crisis and 
its aftermath saw many of our clients facing unprecedented challenges and 
pressures. Many of them cancelled or postponed planned projects and became 
internally focused on identifying and making cost savings. 
 
 
Our Consulting division, which has been the bedrock of our business, came under 
pressure particularly in the latter part of '08 and in Q1 of this year. Both day 
and utilisation rates suffered through a worsening market for our services. I am 
pleased to say that we appear to have successfully managed our way through this 
period. The importance we have attached to the quality of our execution and in 
building our client relationships have paid dividends and so we are cautiously 
optimistic about the division's prospects for the remainder of the year. 
 
 
In our Software division we have continued to invest in our strategic products. 
A new version of our Arc product is now live at two tier 1 banks and Integrity 
now has 3,000 users worldwide at a tier one European bank.  We remain encouraged 
by the level of interest shown in our strategic products, but have been faced 
with lengthening sales cycles as the widespread market uncertainty has led to 
hesitancy.  Our challenge remains one of converting this interest into sales. We 
have sought to address this by increasing our sales resource and through 
aligning sales resource behind our strategic products. 
 
 
The next twelve months are key in terms of proving the viability of our 
strategic software products. The sales re-organisation has improved the strength 
and quality of our sales pipe and we remain confident in the division's future. 
Within our clients, the demand for increased visibility and control has retained 
its high profile, triggering interest in both Arc and Integrity.  Arc offers the 
potential for significant cost savings at a time when our clients are under 
pressure to become more efficient. 
 
 
The market for our Consulting services has improved in recent months as our 
clients are now returning to business as usual and in some instances are finding 
themselves lacking in resource.  Looking further out, we believe the demand for 
our services and products will build as the pressure grows on our customers to 
become more efficient and increase their level of internal control. 
 
 
We would also like to advise our shareholders that the Board is currently 
considering the merits of continuing with the Company's AIM listing.   For some 
time, the Board has felt that the Company's valuation does not accurately 
reflect the strategic progress made in recent years.  This, together with the 
shares' low liquidity and the costs of the listing, have lead us to believe that 
BCS's plans might be better served as a private entity.  The Board is currently 
exploring how a delisting might be best achieved and is also deliberating the 
most appropriate and practical mechanism that would allow shareholders who do 
not or cannot hold shares in an off market company to sell some of their 
holdings. We will advise shareholders of our plans in due course. 
 
 
I'd like to finish by thanking all of our staff for their continued hard work 
and commitment in the first half of 2009. 
 
 
 
 
 
 
 
 
 
 
Steve Russell 
Chairman 
 
 
30 September 2009 
 
 
 
 
 
 
Chief Executive's Review 
 
 
Consulting revenues recovered from a slow start to the year to end the period 
marginally up on H1 2008.  Software revenues have again fallen back as we 
continue to focus on our strategic products: Integrity and Arc. Whilst we are 
encouraged by the levels of interest shown in both Integrity and Arc, the 
challenge remains for us to convert this interest into contracted sales.We have 
remained mindful of the need to conserve our cash balance in what has been a 
volatile market and through cost reduction measures taken largely in '07 and '08 
we have retained a healthy cash balance. 
 
 
Financial Performance 
 
 
Revenue 
Group revenues for the half year fell back 1% on 2008 to GBP4,497,000. 
Consulting revenues for the half year on a day adjusted basis grew by 1% whilst 
Software revenues declined by 11%. 
 
 
In our Consulting division, after a disappointing start to the year, we saw 
revenues recover strongly with Q2 average daily sales being 11% higher than 
those experienced in Q1.2008 saw us experience a weakening in demand for our 
services as our customers began to feel the effects of the financial crisis and 
this impact continued into the early part of 2009. The strength of our 
relationships and agility due to our size have allowed us to emerge relatively 
unscathed from what has been an extremely challenging period. 
 
 
+-------------------+---------+---------+---------+---------+---------+---------+ 
|                   |  Q1 '08 |  Q2 '08 |  Q3 '08 |  Q4 '08 |  Q1 '09 |  Q2 '09 | 
+-------------------+---------+---------+---------+---------+---------+---------+ 
| Average Daily     |  31,823 |  31,143 |  29,615 |  29,844 |  30,175 |  33,623 | 
| Sales GBP         |         |         |         |         |         |         | 
+-------------------+---------+---------+---------+---------+---------+---------+ 
| Change on prior   |     17% |      2% |     -1% |     -7% |     -5% |      8% | 
| year              |         |         |         |         |         |         | 
+-------------------+---------+---------+---------+---------+---------+---------+ 
 
 
 
 
Revenues in the Software division fell by 11%.  This fall reflects our strategy 
of focusing the Software division on generic products rather than bespoke 
solutions. We have not looked to sell in enhancements to our installed solutions 
base and revenue from these services is down by GBP160,000 on H1 '08.  Our 
efforts to improve the visibility of the Company's forward revenue streams have 
led to the division's recurring revenues increasing 23% to GBP497,000, now 
representing 90% of the division's revenue. 
 
 
Gross margin 
Gross margin for the Group for the half year was 28%, down from 34% last year. 
In the Consulting division, margins were off by 6% on H1 '08.  The consultancy 
margin in Q1 was badly affected by a higher and heavier bench than we have 
become used to, with senior resource being under utilised. Q2 has seen 
utilisation recover to recent historical levels contributing to an improvement 
in the Q2 margin of 8% on Q1. Margins have additionally come under rate pressure 
from some of our customers and our lack of confidence in the market resulted in 
us servicing opportunities through our associate network rather than recruiting 
permanent staff. Margins from our associates are typically well below those 
achieved from our permanent staff. In the Software division margins retreated 
slightly (2%) largely in response to the reduction in the level of enhancement 
activity to our installed solutions base which is primarily billed on a T&M 
basis. 
 
 
Operating expenses 
Operating expenses for the half year increased by GBP108,000 on H1 '08.  This is 
largely down to the fact that amortisation of Integrity did not commence until 
June '08. Removing the impact of both amortisation and capitalisation, operating 
expenses reduced by GBP164,000.The saving can largely be attributed to headcount 
related savings from within the Software division. 
 
 
Finance income 
Finance income for the period dropped to GBP13,000 from GBP50,000 primarily as a 
result of the fall in interest rates. 
 
 
  Loss before tax 
The Group reported a loss before tax for the half year of GBP414,000 against a 
profit in H1 '08 of GBP29,000.  Removing the impact of development cost 
capitalisation and amortisation then the loss for the half year rose from 
GBP263,000 in H1 '08 to GBP434,000. 
 
 
Balance sheet 
Intangible assets include GBP975,000 of capitalised development costs (2008: 
GBP881,000).  Our investment in the new version of Arc accounts for the increase 
in the carrying value in the period. 
 
 
Debtor days outstanding have improved to 50 (H1 2008: 61) due to better credit 
control and changes in the customer and sales mix. 
 
 
Cash flow 
The period saw us use GBP788,000 (H1 '08 GBP458,000) of cash. Q1 sees us meet 
our annual bonus obligation in our Consulting division, in respect of the 
previous year. Although debtor days improved significantly on June '08 they fell 
back on December '08, had they remained at December's level then cash would have 
been c.GBP350,000 higher.  We additionally invested a further GBP186,000 in 
building our strategic products, principally Arc. 
 
 
Dividends 
The Directors do not propose the payment of an interim dividend for the six 
months to 30 June 2009 (2008: nil). 
 
 
 
Consulting Division 
 
 
The division began the year facing a number of challenges: customer pressure on 
rates; a number of engagements coming to an end; a higher bench and a thin sales 
pipe. The division reacted to these challenges by swapping reduced rates for 
increased tenure; accepting reduced rates for 'benched' staff; freezing 
recruitment; and passing on any rate reductions where possible to our 
associates. These measures plus the strength of our client relationships allowed 
us to negotiate our way through the challenging environment and we will be in a 
position to move forward once market conditions improve.  In Q2, we saw 
utilisation levels return to, and settle above, 85% with daily revenues 
consistently above GBP30,000. 
 
 
In Q1, short term confidence levels were low and consequently rather than 
recruit speculatively we reacted to any opportunities by drawing on our 
associate network. This had a knock on negative effect on margins as the margin 
earned from an associate is significantly below that from a permanent employee. 
Our average chargeable headcount in the period remained unchanged on H1'08 at 
55, however the percentage mix between permanent staff and associates swung from 
71:29 to 60:40. We are now more confident in our immediate prospects and are 
currently recruiting selectively. One impact of this should be a redressing of 
the balance between permanent staff and associates and a resultant positive 
impact on the margin. 
 
 
Our strategy in this division is to continue to concentrate our efforts on 
delivering a focused quality consulting proposition to our targeted customer 
base.  We remain focused on the financial markets sector where we continue to 
target the wholesale banking sector, specifically Investment Banks, Asset 
Management and Service Provider organisations where we are able to leverage our 
domain experience. We have continued to build our reputation as an execution 
focused management consultancy firm.  Our core offer is concentrated around the 
themes of cost reduction and business transformation. Within our cost reduction 
offering we look to identify and capture operational savings through our 
understanding of an organisation's enterprise architecture requirements. Under 
business transformation we have considerable experience in designing and 
implementing large change programmes for a variety of financial sector 
organisations in operations, finance and technology functions. 
 
 
We have continued the process of investing in our people and have seen staff 
attrition rates improve significantly.  Having identified business development 
skills as a key area for improvement in '08 we have implemented both training 
and coaching programmes.  We believe we are now beginning to reap the benefits 
of the investments we have made in recruiting and in training high calibre 
personnel, which, are now showing through in the quality of our service 
delivery. 
 
 
Software Division 
 
 
In Software, we remain focused on building and establishing our strategic 
products as industry leading and through our move to an annuity revenue model we 
aim to create a more stable business model.  The first half of the year has 
again been particularly challenging for the Software division. The market for 
our products has been at best uncertain with many of our customers operating 
under strict budgetary constraints. Our products aim to deliver both increased 
levels of control and cost savings and continue to generate strong interest. The 
division has increased its focus on its strategic products recruiting a senior 
account manager dedicated to Integrity.  We now have dedicated sales resource 
behind both Integrity and Arc and have worked hard at improving the quality of 
our sales pipe. We now have greater confidence in our conversion prospects. 
 
 
Our development focus in the first half has been very much on delivering the new 
version of our Arc product.  This version has recently gone live at two tier 1 
global banks and is now the leading enterprise solution in agent bank fee 
management.  In the first six months of the year we capitalised GBP186,000 (H1 
'08 GBP316,000) of labour development costs, the bulk of which 
being attributable to Arc.  Development effort in the second half will now be 
targeted at sales led enhancements to Integrity and Arc and sales support 
activities. 
 
 
We have continued to manage the division's cost base tightly with costs 
down, after removing the impact of amortisation and capitalisation, GBP116,000 
(13%) on H1 '08.  The savings having been achieved through a reduction of two in 
the average number of heads employed as we continue to narrow our focus. 
 
 
Current Trading and Outlook 
 
 
Market trends for our Consulting division in the near to mid term appear 
encouraging with the financial crisis having postponed a number of client 
initiatives which are now being resurrected.  Another fall out from the 
financial crisis has been the wave of increased regulation requiring clients to 
make significant changes to their internal processes. This allied to the need 
for our clients to be more efficient, we believe, is likely to see increased 
demand for consulting services. Whilst visibility of future revenues in our 
Consulting division is relatively short we are confident of our prospects in the 
remainder of the year. 
 
 
The second half of the year is very important for our Software business. Our two 
strategic products Integrity and Arc are now ready for sale and are subject to 
high levels of customer interest. Having taken the decision to invest in 
additional sales resource in H1 we expect to close out a number of opportunities 
in the year ahead. The quality and strength of our sales pipeline provides us 
with confidence in the division's future. 
 
 
 
 
ND Walder 
Chief Executive 
 
 
30 September 2009 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Condensed Consolidated Statement of Comprehensive Income 
for the six months to 30 June 2009 
+---------------------------+-------+-------------+-------------+--------------+ 
|                           |Notes  |   Unaudited |   Unaudited |      Audited | 
|                           |       |  Six months |  Six months |         Year | 
|                           |       |          to |          to |           to | 
|                           |       |     30 June |     30 June |  31 December | 
|                           |       |        2009 |        2008 |         2008 | 
+---------------------------+-------+-------------+-------------+--------------+ 
|                           |       |     GBP'000 |     GBP'000 |      GBP'000 | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Revenue                   |       |       4,497 |       4,548 |        9,030 | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Cost of sales             |       |     (3,234) |     (2,984) |      (5,757) | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Gross profit              |       |       1,263 |       1,564 |        3,273 | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Operating expenses        |       |     (1,690) |     (1,582) |      (3,333) | 
+---------------------------+-------+-------------+-------------+--------------+ 
| (Loss) before             |       |       (427) |        (18) |         (60) | 
| interest and taxation     |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Finance income            |  4    |          13 |          50 |           99 | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Finance costs             |       |           - |         (3) |          (2) | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Profit / (Loss) before    |       |       (414) |          29 |           37 | 
| taxation                  |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Taxation                  |       |           - |           - |            - | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Profit / (Loss) for the   |       |       (414) |          29 |           37 | 
| period attributed to      |       |             |             |              | 
| equity shareholders       |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
|                           |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Other comprehensive       |       |           - |           - |            - | 
| income for the period     |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Total comprehensive       |       |       (414) |          29 |           37 | 
| income for the period     |       |             |             |              | 
| attributable to equity    |       |             |             |              | 
| holders of the parent     |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
|                           |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
| Basic and diluted         |  5    |      (0.2p) |        0.0p |        0.01p | 
| profit/(loss) per share   |       |             |             |              | 
+---------------------------+-------+-------------+-------------+--------------+ 
 
 
 
 
  Condensed Consolidated Statement of Financial Position 
as at 30 June 2009 
+--------------------------+--------+-------------+-------------+-------------+ 
|                          | Notes  |   Unaudited |   Unaudited |     Audited | 
|                          |        |     30 June |     30 June | 31 December | 
|                          |        |        2009 |        2008 |        2008 | 
+--------------------------+--------+-------------+-------------+-------------+ 
|                          |        |     GBP'000 |     GBP'000 |     GBP'000 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Assets                   |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Non current assets       |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Intangible assets        |   6    |         996 |         924 |         974 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Property, plant and      |        |         117 |         175 |         155 | 
| equipment                |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
|                          |        |       1,113 |       1,099 |       1,129 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Current assets           |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Trade and other          |   7    |       1,767 |       1,767 |       1,390 | 
| receivables              |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Cash and cash            |        |       1,994 |       2,308 |       2,781 | 
| equivalents              |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
|                          |        |       3,761 |       4,075 |       4,171 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Total assets             |        |       4,874 |       5,174 |       5,300 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Liabilities              |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Current liabilities      |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Trade and other payables |   8    |     (1,363) |     (1,292) |     (1,401) | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Non-current liabilities  |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Deferred tax             |        |         (2) |         (2) |         (2) | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Net assets               |        |       3,509 |       3,880 |       3,897 | 
+--------------------------+--------+-------------+-------------+-------------+ 
|                          |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Equity                   |        |             |             |             | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Issued capital           |        |       2,714 |       2,714 |       2,714 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Share premium            |        |       3,303 |       3,303 |       3,303 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Shares to be issued      |        |         577 |         541 |         552 | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Other reserves*          |        |       (308) |       (308) |       (308) | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Retained earnings        |        |     (2,777) |     (2,370) |     (2,364) | 
+--------------------------+--------+-------------+-------------+-------------+ 
| Total equity             |        |       3,509 |       3,880 |       3,897 | 
+--------------------------+--------+-------------+-------------+-------------+ 
*Other reserves includes Warrant, Merger and Capital Reserves. 
 
 
 
 
 
  Condensed Consolidated Statement of Changes in Equity 
for the six months to 30 June 2009 
+----------------------+---------+---------+---------+----------+----------+---------+ 
|                      |   Share |   Share |  Shares |    Other | Retained |   Total | 
|                      | capital | Premium |      to | reserves | earnings |         | 
|                      |         | account |      be |          |          |         | 
|                      |         |         |  issued |          |          |         | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
|                      | GBP'000 | GBP'000 | GBP'000 |  GBP'000 |  GBP'000 | GBP'000 | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| 1 January 2008       |   2,714 |   3,303 |     529 |    (308) |  (2,400) |   3,838 | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| EBT adjustment       |         |         |         |          |        1 |       1 | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| Options charge       |         |         |      12 |          |          |      12 | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| Profit for the year  |         |         |         |          |       29 |      29 | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| 30 June 2008         |   2,714 |   3,303 |     541 |    (308) |  (2,370) |   3,880 | 
| (unaudited)          |         |         |         |          |          |         | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| EBT adjustment       |         |         |         |          |      (1) |     (1) | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| Options charge       |         |         |      11 |          |          |      11 | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| Profit for the       |         |         |         |          |        7 |       7 | 
| period               |         |         |         |          |          |         | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| At 31 December       |   2,714 |   3,303 |     552 |    (308) |  (2,364) |   3,897 | 
| 2008 (audited)       |         |         |         |          |          |         | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| Options charge       |         |         |      25 |          |          |      25 | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| Loss for the period  |         |         |         |          |    (414) |   (414) | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
| 30 June 2009         |   2,714 |   3,303 |     577 |    (308) |  (2,777) |   3,509 | 
| (unaudited)          |         |         |         |          |          |         | 
+----------------------+---------+---------+---------+----------+----------+---------+ 
 
 
 
 
 
  Condensed Consolidated Cash Flow Statement 
for the six months to 30 June 2009 
+--------------------------------------+------------+------------+--------------+ 
|                                      |  Unaudited |  Unaudited |      Audited | 
|                                      | Six months | Six months |         Year | 
|                                      |         to |         to |           to | 
|                                      |    30 June |    30 June |  31 December | 
|                                      |       2009 |       2008 |         2008 | 
+--------------------------------------+------------+------------+--------------+ 
|                                      |    GBP'000 |    GBP'000 |      GBP'000 | 
+--------------------------------------+------------+------------+--------------+ 
| Cash flows from operating activities |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Loss before interest & taxation      |      (427) |       (18) |         (60) | 
+--------------------------------------+------------+------------+--------------+ 
| Adjustments for:                     |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Depreciation of property, plant and  |         48 |         50 |           93 | 
| equipment                            |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Amortisation of intangible assets    |        166 |         37 |          169 | 
+--------------------------------------+------------+------------+--------------+ 
| Share options expense                |         25 |         12 |           23 | 
+--------------------------------------+------------+------------+--------------+ 
| Cash consumed from operations        |      (188) |         81 |          225 | 
| before changes in working capital    |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Movement in trade and other          |      (376) |        364 |          741 | 
| receivables                          |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Movement in trade and other payables |       (39) |      (554) |        (445) | 
+--------------------------------------+------------+------------+--------------+ 
| Cash consumed from operations        |      (603) |      (109) |          521 | 
+--------------------------------------+------------+------------+--------------+ 
| Income tax paid                      |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Interest paid                        |          - |        (3) |          (3) | 
+--------------------------------------+------------+------------+--------------+ 
| Net cash consumed from operating     |      (603) |      (112) |          518 | 
| activities                           |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Cash flows from investing activities |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Purchase of plant and equipment      |       (11) |       (28) |         (50) | 
+--------------------------------------+------------+------------+--------------+ 
| Purchase of software                 |        (1) |       (33) |         (17) | 
+--------------------------------------+------------+------------+--------------+ 
| Interest received                    |         13 |         50 |           99 | 
+--------------------------------------+------------+------------+--------------+ 
| Product development                  |      (186) |      (316) |        (514) | 
+--------------------------------------+------------+------------+--------------+ 
| Net cash used in investing           |      (185) |      (327) |        (482) | 
| activities                           |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Cash flows from financing activities |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Repayment of loan                    |          - |       (19) |         (20) | 
+--------------------------------------+------------+------------+--------------+ 
| Net cash consumed in financing       |          - |       (19) |         (20) | 
| activities                           |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Net (decrease)/increase in cash      |      (788) |      (458) |           16 | 
| and cash equivalents                 |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Cash and cash equivalents at 1       |      2,782 |      2,766 |        2,766 | 
| January                              |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
| Cash and cash equivalents at end of  |      1,994 |      2,308 |        2,782 | 
| period                               |            |            |              | 
+--------------------------------------+------------+------------+--------------+ 
 
 
 
 
 
 
  Notes to the consolidated financial statements 
 
 
1. Basis of preparation 
This announcement was approved by the Board on 30 September 2009.  The financial 
statements have been prepared in accordance with IFRS and IFRICS in issue that 
have been endorsed by the EU and the Companies Act 2006 applicable to the period 
ended 30 June 2009. 
 
 
IAS 1 'Presentation of Financial Statements (revised 2007)' has been applied in 
the preparation of these condensed Group financial statements. The revised 
standard requires the presentation of a statement of changes in equity in the 
primary statements with information previously disclosed in a Capital and 
reserves note in the financial statements. In addition, the Group has elected to 
present a separate statement of comprehensive income. The revised standard also 
suggests certain changes in terminology which have been adopted in these 
condensed Group financial statements. The balance sheet has been renamed 
statement of financial position and the statement of recognised income and 
expense has been renamed statement of comprehensive income. 
 
 
The accounting policies applied are consistent with those set out in the 
financial statements of the Group for the year ended 31 December 2008. The 
financial information for the periods to 30 June 2009 and 30 June 2008 is 
unaudited. The financial information for the year ended 31 December 2008 is 
taken from the statutory accounts for that year, which have been delivered to 
the Registrar of Companies. The auditors gave an unqualified opinion on those 
2008 accounts. 
 
 
Business Control Solutions Group plc through its subsidiaries provides 
management consultancy services and operational control software to financial 
institutions. The Company's registered number is 02089155. 
 
 
 
 
2. Segmental reporting 
The Group's operations are managed and monitored in two business segments: 
Consultancy Services and Software Solutions. Certain support activities are 
monitored centrally and have been allocated on an estimated usage basis to the 
business segments to produce the result below. 
 
 
The directors consider the Group to trade in one geographical segment, the UK. 
 
 
+--------------------------------+-------------+-------------+-------------+ 
| For the six months to 30 June  | Consultancy |    Software |       Total | 
| 2009                           |    Services |   Solutions |             | 
| Unaudited                      |             |             |             | 
+--------------------------------+-------------+-------------+-------------+ 
|                                |     GBP'000 |     GBP'000 |     GBP'000 | 
+--------------------------------+-------------+-------------+-------------+ 
| Segment revenue                |       3,952 |         545 |       4,497 | 
+--------------------------------+-------------+-------------+-------------+ 
| Segment result                 |         161 |       (575) |       (414) | 
+--------------------------------+-------------+-------------+-------------+ 
 
 
During the period there was no inter-segmental revenue (2008: GBPnil). 
 
 
+--------------------------------+-------------+-------------+-------------+ 
| For the six months to 30 June  | Consultancy |    Software |       Total | 
| 2008                           |    Services |   Solutions |             | 
| Unaudited                      |             |             |             | 
+--------------------------------+-------------+-------------+-------------+ 
|                                |     GBP'000 |     GBP'000 |     GBP'000 | 
+--------------------------------+-------------+-------------+-------------+ 
| Segment revenue                |       3,934 |         614 |       4,548 | 
+--------------------------------+-------------+-------------+-------------+ 
| Segment result                 |         342 |       (313) |          29 | 
+--------------------------------+-------------+-------------+-------------+ 
 
 
 
 
+--------------------------------+-------------+-------------+-------------+ 
| For the year to 31             | Consultancy |    Software |       Total | 
| December 2008                  |    Services |   Solutions |             | 
| Audited                        |             |             |             | 
+--------------------------------+-------------+-------------+-------------+ 
|                                |     GBP'000 |     GBP'000 |     GBP'000 | 
+--------------------------------+-------------+-------------+-------------+ 
| Segment revenue                |       7,771 |       1,260 |       9,030 | 
+--------------------------------+-------------+-------------+-------------+ 
| Segment result                 |         832 |       (796) |          37 | 
+--------------------------------+-------------+-------------+-------------+ 
 
 
 
 
 
  3. Employee numbers 
+------------------------------------+-------------+------------+--------------+ 
|                                    |  Six months | Six months |      Year to | 
|                                    |          to |         to |  31 December | 
|                                    |     30 June |    30 June |         2008 | 
|                                    |        2009 |       2008 |              | 
+------------------------------------+-------------+------------+--------------+ 
|                                    |         No. |        No. |          No. | 
+------------------------------------+-------------+------------+--------------+ 
| The average number of persons      |             |            |              | 
| employed during the year was:      |             |            |              | 
+------------------------------------+-------------+------------+--------------+ 
| Non-executive directors            |           3 |          3 |            3 | 
+------------------------------------+-------------+------------+--------------+ 
| Office and management              |          13 |         12 |           12 | 
+------------------------------------+-------------+------------+--------------+ 
| Sales and marketing                |           2 |          3 |            2 | 
+------------------------------------+-------------+------------+--------------+ 
| Programming and solution delivery  |          24 |         26 |           26 | 
| staff                              |             |            |              | 
+------------------------------------+-------------+------------+--------------+ 
| Consultants                        |          31 |         40 |           38 | 
+------------------------------------+-------------+------------+--------------+ 
|                                    |          73 |         84 |           81 | 
+------------------------------------+-------------+------------+--------------+ 
 
 
 
 
4. Finance income 
+-------------------------------------+------------+------------+---------------+ 
|                                     |  Unaudited |  Unaudited |       Audited | 
|                                     | Six months | Six months |          Year | 
|                                     |         to |         to |            to | 
|                                     |    30 June |    30 June |   31 December | 
|                                     |       2009 |       2008 |          2008 | 
+-------------------------------------+------------+------------+---------------+ 
|                                     |    GBP'000 |    GBP'000 |       GBP'000 | 
+-------------------------------------+------------+------------+---------------+ 
| Bank interest receivable            |         13 |         50 |            99 | 
+-------------------------------------+------------+------------+---------------+ 
 
 
 
 
5. Profit / (Loss) per share 
Basic profit/(loss) per share is calculated by dividing the Group's loss after 
taxation of GBP414,000 (2008: profit of GBP29,000) by the weighted average 
number of shares in issue less the weighted average number of shares held by the 
EBTs during the year of 270,042,705 (2008: 269,657,772). 
 
 
 
 
6. Intangible assets 
Research expenditure is recognised as an expense as incurred. Costs incurred on 
product development relating to the design, programming and testing of new or 
enhanced products are capitalised as intangible assets after considering: the 
probability that the development will provide economic benefits; its commercial 
and technological feasibility; resource availability and whether costs can be 
measured reliably. The expenditure capitalised is the direct employment costs 
and is managed and controlled centrally. Other development costs are recognised 
as an expense as incurred. 
 
 
During the six months to 30 June 2009 GBP186,000 of development costs were 
capitalised (2008: GBP316,000). During the six months to 30 June 2009 the 
amortisation charge was GBP166,000 (2008: GBP24,000). 
 
 
 
 
7. Trade and other receivables 
+-------------------------------+-------------+-------------+-------------+ 
|                               |   Unaudited |   Unaudited |     Audited | 
|                               |     30 June |     30 June | 31 December | 
|                               |        2009 |        2008 |        2008 | 
+-------------------------------+-------------+-------------+-------------+ 
|                               |     GBP'000 |     GBP'000 |     GBP'000 | 
+-------------------------------+-------------+-------------+-------------+ 
| Trade receivables             |       1,454 |       1,529 |       1,108 | 
+-------------------------------+-------------+-------------+-------------+ 
| Other receivables             |         313 |         238 |         282 | 
+-------------------------------+-------------+-------------+-------------+ 
|                               |       1,767 |       1,767 |       1,390 | 
+-------------------------------+-------------+-------------+-------------+ 
 
 
 
 
 
 
8. Trade and other payables 
+-------------------------------+--------------+--------------+-------------+ 
|                               |    Unaudited |    Unaudited |     Audited | 
|                               |      30 June |      30 June | 31 December | 
|                               |         2009 |         2008 |        2008 | 
+-------------------------------+--------------+--------------+-------------+ 
|                               |      GBP'000 |      GBP'000 |     GBP'000 | 
+-------------------------------+--------------+--------------+-------------+ 
| Trade payables                |          344 |          292 |         176 | 
+-------------------------------+--------------+--------------+-------------+ 
| Other payables                |        1,019 |        1,000 |       1,225 | 
+-------------------------------+--------------+--------------+-------------+ 
|                               |        1,363 |        1,292 |       1,401 | 
+-------------------------------+--------------+--------------+-------------+ 
 
 
 
 
9. Circulation 
Copies of this announcement will be available from the Company's registered 
office: Ground Floor, Churchgate, New Road, Peterborough PE1 1TT and on the 
Company's website www.bcsplc.com. 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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