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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Concurrent Technologies Plc | LSE:CNC | London | Ordinary Share | GB0002183191 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -0.50 | -0.49% | 101.50 | 101.00 | 102.00 | 102.00 | 101.50 | 102.00 | 209,594 | 13:01:36 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Printed Circuit Boards | 18.28M | 987k | 0.0115 | 88.26 | 86.92M |
From May 2019 to May 2024
TIDMCNC
RNS Number : 7407X
Concurrent Technologies PLC
02 September 2020
This announcement contains inside information
2 September 2020
Concurrent Technologies Plc
(the "Company" or the "Group")
Interim Results for the six months ended 30 June 2020
Concurrent Technologies Plc (AIM: CNC), a world leading specialist in the design and manufacture of high-end embedded computer boards for critical applications, announces interim results for the six months to 30 June 2020, reflecting a positive trading period with strong sales, profit before tax and investment.
Financial Highlights
-- Turnover of GBP9.2m (H1 2019: GBP9.5m) -- Gross profit of GBP4.9m (H1 2019: GBP4.9m) -- Gross margin of 52.9% (H1 2019: 51.7%) -- Group operating profit of GBP1.2m (H1 2019: GBP1.6m)
-- Adjusted Profit before tax GBP1.2m (H1 2019: GBP1.7m, after adjusting for non-recurring income of GBP1.0m) (*)
-- Profit before tax of GBP1.2m (H1 2019: GBP2.7m) (**) -- Adjusted EPS on continuing activities of 1.62 pence (H1 2019: 2.21 pence)(*) -- EPS of 1.62 pence (H1 2019: 3.31 pence) -- Interim dividend increased to 1.1p per share (H1 2019: 1.05p) -- Cash balance (including cash deposits) at 30 June 2020 of GBP10.0m (H1 2019: GBP10.0m) -- Cessation of engineering facility in India
(*) Adjusted results are prepared to provide a more comparable indication of the Group's core business performance by removing the impact of receipts from the key man insurance policy.
(**) 2019 statutory profit before tax includes GBP1m non-recurring income relating to key man insurance.
Operational Highlights
-- Defence remains the largest individual sector, accounting for 68% of Group turnover during the period
-- Strong order intake resulting in record order book in May 2020
-- Global customer base continues to expand with exports generating 96% of Group revenues (H1 2019: 90%)
-- Spending on R&D during the period was GBP1.8m (H1 2019: GBP1.7m)
Mark Cubitt, Chairman of Concurrent Technologies Plc, commented: "Despite the ongoing situation regarding COVID-19 and the one-time additional costs associated with the reorganisation of the engineering team, the Group's trading has been consistently strong throughout a very volatile period and the team has successfully built on an excellent 2019. With a robust balance sheet and a solid overall order book, the Group is in an excellent position for future growth and the Board has confidence in meeting market expectations for the current year."
Enquiries:
Concurrent Technologies Plc Jane Annear, Managing Director +44 (0)1206 752626 Newgate (Financial PR) Bob Huxford +44 (0)20 7653 9848 Isabelle Smurfit +44 (0)20 3757 3411 Cenkos Securities Plc (NOMAD) Neil McDonald +44 (0)131 220 9771 Peter Lynch +44 (0)131 220 9772
About Concurrent Technologies Plc
Concurrent Technologies Plc develops and manufactures high-end embedded computer products for use in a wide range of high performance, long life cycle applications within the telecommunications, defence, security, telemetry, scientific and aerospace markets, including applications within extremely harsh environments. The processor products feature Intel(R) processors, including the latest 9(th) generation embedded Intel(R) Core(TM) processors, Intel(R) Xeon(R) and Intel(R) Atom(TM) processors. The products are designed to be compliant with industry specifications and support many of today's leading embedded Operating Systems. The products are sold world-wide.
For more information on Concurrent Technologies Plc and its products please visit www.gocct.com.
All trademarks, registered trademarks and trade names used in this announcement are the property of their respective owners.
CHAIRMAN'S STATEMENT
In my first results as Chairman I am pleased to announce that the Group's trading performance has continued on from the positive results reported for 2019, with strong sales in the first half of 2020 and a solid order book, despite the challenging economic backdrop.
I would also like to acknowledge the role of our former Chairman, Michael Collins, who retires from the Board at the end of the month, and on behalf of the Group to thank him for his guidance and stewardship over the last 31 years. Concurrent would not be where it is today without Michael's significant contribution.
Financial Summary
The Company continued to trade and operate in a largely normal fashion during the first half of 2020, notwithstanding the onset of the COVID-19 pandemic. Revenue for the period was GBP9.2m (1H 2019: GBP9.5m), with the slight reduction in sales compared to the equivalent period in 2019 when an exceptional order was shipped. Gross margin increased to 52.9%. (1H 2019: 51.7%) and gross profit was maintained at GBP4.9m (1H 2019: GBP4.9m). The unaudited profit before tax (PBT) for the period was GBP1.2m (1H 2019: GBP1.7m net of a non-recurring payment of GBP1m pursuant to the Group's key man insurance). The decrease in PBT is largely due to a reduction in the amount of engineering costs that was capitalised in the period. The associated earnings per share (EPS) are 1.62 pence (1H 2019: 2.21 pence after adjusting for the GBP1m receipt referred to above).
The Group's balance sheet remains strong, with cash balances (including cash deposits) at 30 June 2020 of GBP10.0m (1H 2019: GBP10.0m).
Dividend
Given the strength of the Group's cash position and the balance sheet, the Board has declared a first interim dividend of 1.1p per share (H1 2019: 1.05p) - an increase of 4.8%. The total cost of this dividend will amount to GBP810,408. The ex-dividend date for this interim dividend is 17 September 2020, the record date is 18 September 2020 and the payment date is 2 October 2020.
Review of Operations
Having been designated as an essential defence supplier, production at the Company's Colchester headquarters continued throughout the lockdown period and the Group has not found it necessary to apply for support under any Government COVID-19 initiatives.
The Group has seen sales within the defence market increase to GBP6.3m (1H 2019: GBP5.5m) representing 68% (1H 2019: 58%) of revenue, while exports increased to 96% (1H 2019: 90%).
Our engineering group has generally been able to continue with its current projects whilst working at home as necessary, although our Indian site has proved to be a more challenging environment in which to achieve this. This has resulted in reduced productivity in the design group where our capitalisation rate of engineering costs is not as high as we might normally expect. This has adversely impacted PBT as a substantial proportion of these costs was expensed in the period. GBP1.8m (1H 2019: GBP1.7m) was invested in R&D prior to capitalisation during the first half of the year.
New products introduced during the first half of the year included a further high performance 3U VPX processor board as well as the release of our first Artificial Intelligence "AI" product. Both products were designed primarily for the defence market, with the AI product being targeted towards applications such as surveillance where faster and more in-situ analysis of data is essential. In addition, the Board is encouraged by the progress being made to introduce the AI technology into new markets. There has also been an increase in the demand for our software products, particularly for the support of our security product for applications within the defence market. To assist with our objective of increasing the provision of development systems to customers, we have further expanded our third party partner programme to increase support of complementary products.
India
With this strategy of broadening our products and services, and as part of the ongoing reorganisation of the Group to introduce new skills and improved working practices, the Board has taken the decision to cease operations in the Group's engineering facility in India. This move will enable the Group to gain from the efficiencies of re-focussing our engineering team in the UK. Some of the costs associated with this exercise, which should be completed by the end of the year, have already been absorbed and are reflected in the first half results, with an anticipated full year charge of approximately GBP0.5m. We have successfully recruited additional engineering resources in the UK by filling both junior and senior roles and will continue to add new skills to the UK team during the rest of the year, as appropriate.
Future Plans
Our engineering team will continue to focus on introducing new hardware designs based on Intel processors, in addition to introducing complementary products in line with our core business needs and plans. We are also committed to supporting our customer base with new products for the long established VME and CompactPCI product ranges, while introducing new technologies on the VPX and AMC product lines. Development of our AI products continues, as does our commitment to increase our systems and services business.
Whilst the reorganisation of the engineering teams will result in a small short-term increase in costs, the benefits should start to be seen in 2021 through cost savings and improved design efficiencies. This is expected to deliver a positive impact on profitability through an estimated annual net saving of GBP0.5m from the start of 2021.
Outlook
Despite the ongoing situation regarding COVID-19 and the one-time additional costs associated with the reorganisation of the engineering team, the Group's trading has been consistently strong throughout a very volatile period and the team has successfully built on an excellent 2019. With a robust balance sheet and a solid overall order book, the Group is in an excellent position for future growth and the Board has confidence in meeting market expectations for the current year.
Mark Cubitt
Chairman
1 September 2020
All companies and product names are trademarks of their respective organisations.
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
Unaudited interim results to 30 June 2020
Hot Features
Premium
Six months Six months
ended ended Year ended
Note 30/06/20 30/06/19 31/12/19
GBP GBP GBP
CONTINUING OPERATIONS
Revenue 9,191,045 9,539,922 19,384,724
Cost of sales 4,325,867 4,608,129 9,174,588
======================================== ==== ================== ================== ==================
Gross profit 4,865,178 4,931,793 10,210,136
Net operating expenses 3,627,665 3,313,078 7,204,073
Group operating profit 1,237,513 1,618,715 3,006,063
Finance costs (40,035) - (41,808)
Finance income 23,171 38,082 96,601
Other income 5 - 1,000,000 1,000,000
======================================== ==== ================== ================== ==================
Profit before tax 1,220,649 2,656,797 4,060,856
Tax 25,858 248,898 52,857
======================================== ==== ================== ================== ==================
Profit for the period 1,194,791 2,407,899 4,007,999
======================================== ==== ================== ================== ==================
Other Comprehensive Income
Exchange differences on translating
foreign operations 419,634 16,596 (186,972)
Tax relating to components of other - - -
comprehensive income
======================================== ==== ================== ================== ==================
Other Comprehensive Income for
the period, net of tax 419,634 16,596 (186,972)
======================================== ==== ================== ================== ==================
Total Comprehensive Income for
the period 1,614,425 2,424,495 3,821,026
======================================== ==== ================== ================== ==================
Profit for the period attributable
to:
======================================== ==== ================== ================== ==================
Equity holders of the parent 1,194,791 2,407,899 4,007,999
======================================== ==== ================== ================== ==================
Total Comprehensive Income attributable
to:
======================================== ==== ================== ================== ==================
Equity holders of the parent 1,614,425 2,424,495 3,821,026
======================================== ==== ================== ================== ==================
Earnings per share
Basic earnings per share 4 1.62p 3.31p* 5.51p
Diluted earnings per share 4 1.62p 3.31p* 5.47p
*Includes income and associated tax from key man insurance policy
CONDENSED CONSOLIDATED BALANCE SHEET
Unaudited interim results to 30 June 2020
As at As at As at
30/06/20 30/06/19 31/12/19
ASSETS GBP GBP GBP
Non-current assets
Property, plant and equipment 1,683,186 672,988 1,638,429
Intangible assets 7,917,503 8,089,260 7,991,119
Deferred tax assets 100,930 140,984 142,894
9,701,619 8,903,232 9,772,442
Current assets
Inventories 6,546,821 4,913,969 5,097,907
Trade and other receivables 3,132,765 2,907,389 2,703,960
Current tax assets 334,082 101,621 274,221
Other financial assets - 999,315 -
Cash and cash equivalents 10,034,786 9,031,044 10,487,902
======================================= ================ ============== ================
20.048.454 17,953,338 18,563,990
Total assets 29.750.073 26,856,570 28,336,432
======================================= ================ ============== ================
LIABILITIES
Non-current liabilities
Deferred tax liabilities 1,537,532 1,457,296 1,453,331
Long term provisions 14,964 14,794 16,731
======================================= ================ ============== ================
1,552,496 1,472,090 1,470,062
Current liabilities
Trade and other payables 5,410,722 3,827,836 4,964,824
Short term provisions 15,382 15,170 16,832
Current tax liabilities - 14,588 -
====================================== ================ ============== ================
5,426,104 3,857,594 4,981,656
Total liabilities 6,978,600 5,329,684 6,451,718
======================================= ================ ============== ================
Net assets 22,771,473 21,526,886 21,884,714
======================================= ================ ============== ================
EQUITY
Capital and reserves
Share capital 739,000 739,000 739,000
Share premium account 3,699,105 3,699,105 3,699,105
Capital redemption reserve 256,976 256,976 256,976
Cumulative translation reserve 582,022 365,956 162,388
Profit and loss account 17,494,370 16,465,849 17,027,245
======================================= ================ ============== ================
Equity attributable to equity holders
of the parent 22,771,473 21,526,886 21,884,714
Total equity 22,771,473 21,526,886 21,884,714
======================================= ================ ============== ================
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
Unaudited interim results to 30 June 2020
Six months Six months
ended ended Year ended
30/06/20 30/06/19 31/12/19
GBP GBP GBP
Cash flows from operating activities
Profit before tax for the period 1,220,649 2,656,797 4,060,856
Adjustments for:
Finance income (23,171) (38,082) (96,601)
Finance costs 40,035 - 41,808
Depreciation 142,154 108,085 315,687
Amortisation 888,299 909,491 1,788,003
Impairment loss 125,000 350,000 483,630
Loss on disposal of property, - - -
plant and equipment
Share-based payment - 82,421 82,421
Exchange differences 467,772 20,619 (205,790)
(Increase)/decrease in inventories (1,448,914) (817,393) (1,001,331)
(Increase)/decrease in trade and
other receivables (428,805) 445,192 648,621
Increase/(decrease) in trade and
other payables 493,329 1,038,077 1,232,237
======================================= ================ ================= ================
Cash generated from operations 1,476,348 4,755,207 7,349,541
Tax received/(paid) (1,209) (27,415) (21,173)
======================================= ================ ================= ================
Net cash generated from operating
activities 1,475,139 4,727,792 7,328,368
======================================= ================ ================= ================ Cash flows from investing activities Interest received 23,171 38,082 96,601 Cash released from/(placed on) - (999,315) - deposit Purchases of property, plant and equipment (182,469) (75,403) (476,376) Proceeds from sale of property, - - - plant and equipment Purchases of intangible assets (939,585) (1,357,983) (2,272,054) ======================================= ================ ================= ================ Net cash used in investing activities (1,098,883) (2,394,619) (2,651,829) ======================================= ================ ================= ================ Cash flows from financing activities Equity dividends paid (1,054,561) (981,698) (1,745,345) Repayment of leasing liabilities (50,648) - (108,426) Interest paid (40,035) - (41,808) Sale of treasury shares 368,550 4,950 4,950 Net cash used in financing activities (776,694) (976,748) (1,890,629) ======================================= ================ ================= ================ Effects of exchange rate changes on cash and cash equivalents (52,678) (4,733) 22,640 Net increase/(decrease) in cash (453,116) 1,351,692 2,808,550 Cash at beginning of period 10,487,902 7,679,352 7,679,352 ======================================= ================ ================= ================ Cash at the end of the period 10,034,786 9,031,044 10,487,902 ======================================= ================ ================= ================
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Unaudited interim results to 30 June 2020
Capital Cumulative Profit
Share Share redemption translation and loss Total
capital Premium reserve reserve account equity
GBP GBP GBP GBP GBP GBP
Balance at 1 January
2019 739,000 3,699,105 256,976 349,360 14,670,553 19,714,994
Profit for the period - - - - 2,407,899 2,407,899
Exchange differences
on translating foreign
operations - - - 16,596 - 16,596
=============================== ======== ========= =========== ============ =========== ===========
Total recognised comprehensive
income for the period - - - 16,596 2,407,899 2,424,495
Share-based payment - - - - 82,421 82,421
Deferred tax on share-based
payment - - - - 3,403 3,403
Dividends paid - - - - (981,698) (981,698)
Sale of treasury shares - - - - 4,950 4,950
Balance at 30 June 2019 739,000 3,699,105 256,976 365,956 16,187,528 21,248,565
=============================== ======== ========= =========== ============ =========== ===========
Profit for the period - - - - 1,600,100 1,600,100
Exchange differences
on translating foreign
operations - - - (203,568) - (203,568)
=============================== ======== ========= =========== ============ =========== ===========
Total recognised comprehensive
income for the period - - - (203,568) 1,600,100 1,396,532
Share-based payment - - - - - -
Deferred tax on share-based
payment - - - - 3,264 3,264
Dividends paid - - - - (763,647) (763,647)
Sale of treasury shares - - - - - -
Balance at 31 December
2019 739,000 3,699,105 256,976 162,388 17,027,245 21,884,714
=============================== ======== ========= =========== ============ =========== ===========
Profit for the period - - - - 1,194,791 1,194,791
Exchange differences
on translating foreign
operations - - - 419,634 - 419,634
=============================== ======== ========= =========== ============ =========== ===========
Total recognised comprehensive
income for the period - - - 419,634 1,194,791 1,614,425
Share-based payment - - - - - -
Deferred tax on share-based
payment - - - - (41,655) (41,655)
Dividends paid - - - - (1,054,561) (1,054,561)
Sale of treasury shares - - - - 368,550 368,550
Balance at 30 June 2020 739,000 3,699,105 256,976 582,022 17,494,370 22,771,473
=============================== ======== ========= =========== ============ =========== ===========
NOTES TO THE INTERIM REPORT
1. General information
The principal activity of the Group is design, manufacture
and supply of innovative high-end embedded single board computers
and complementary accessories aimed at a wide base of customers
within the defence, telecommunications, aerospace, transport,
scientific and industrial markets.
Concurrent Technologies Plc ("the Company") is the Group's
ultimate parent company. It is incorporated and domiciled
in Great Britain. Concurrent Technologies Plc shares are listed
on the Alternative Investment Market of the London Stock Exchange.
The Group's condensed consolidated interim financial statements
are presented in pounds sterling (GBP), which is also the
functional currency of the parent company.
These condensed consolidated interim financial statements,
which are unaudited, have been approved for issue by the Board
of Directors on 1 September, 2020.
The information relating to the six months ended 30 June 2020
and 30 June 2019 is unaudited and does not constitute statutory
accounts within the meaning of section 434 of the Companies
Act 2006. The statutory accounts for the year ended 31 December
2019, prepared in accordance with IFRSs (International Financial
Reporting Standards) as adopted by the European Union, have
been reported on by the Group's auditors and delivered to
the Registrar of Companies. The auditors' report was unqualified,
did not draw attention to any matters by way of emphasis and
did not contain a statement under section 498(2) or (3) of
the Companies Act 2006.
2. Summary of significant accounting policies
2.1 Basis of preparation
These condensed consolidated interim financial statements
are for the six months ended 30 June 2020. They have been
prepared in accordance with IAS 34 "Interim Financial Reporting".
They do not include all of the information required for full
annual financial statements, and should be read in conjunction
with the consolidated financial statements of the Group for
the year ended 31 December 2019, which have been prepared
in accordance with adopted IFRSs.
The accounting policies applied and methods of computation
are consistent with those of the annual financial statements
for the year ended 31 December 2019, as described in those
financial statements. The accounting policies have been consistently
applied to all the periods presented.
There are no new IFRSs or IFRIC interpretations that are effective
for the first time for the financial period beginning on or
after 1 January 2020 that would be expected to have a material
impact on the results or financial position of the Group.
2.2 Going Concern
The Directors are satisfied that the Group has sufficient
resources to continue in operation for the foreseeable future,
a period of not less than 12 months from the date of this
report. Accordingly, they continue to adopt the going concern
basis in preparing these condensed financial statements.
2.3 Taxation
Current tax expense is recognised in these condensed consolidated
interim financial statements based on estimated effective
tax rates for the full year.
3. Segmental reporting
The Directors consider that the Group is engaged in a single
segment of business, being design, manufacture and supply
of high-end embedded computer products, and that therefore
the Company has only a single operating segment. The key measure
of performance used by the Board to assess the Group's performance
is the Group's profit before tax, as calculated under IFRS,
and therefore no reconciliation is required between the measure
of profit or loss used by the Board and that contained in
the condensed consolidated interim financial statements.
4. Earnings per share
Basic earnings per share is calculated by dividing the profit
attributable to ordinary equity holders for the period by
the weighted average number of ordinary shares outstanding
during the period.
Diluted earnings per share is calculated adjusting the weighted
average number of ordinary shares outstanding to assume conversion
of all contracted dilutive potential ordinary shares. The
Company only has one category of dilutive potential ordinary
shares, namely share options.
The inputs to the earnings per share calculation are shown
below:
Six months Six months
ended ended Year ended
30/06/20 30/06/19 31/12/19
GBP GBP GBP
Profit attributable to ordinary
equity holders 1,194,791 2,407,899 4,007,999
==================================== ============ ============ ============
Six months Six months
ended ended Year ended
30/06/20 30/06/19 31/12/19
N(o) N(o) N(o)
Weighted average number of
ordinary
shares for basic earnings
per share 73,673,490 72,728,490 72,728,490
Adjustment for share options 195,579 2,457 574,542
==================================== ============ ============ ============
Weighted average number of
ordinary shares for diluted
earnings per share 73,869,069 72,730,947 73,303,032
==================================== ============ ============ ============
5. Other Income
Other income relates exclusively to a claim made against a
key man insurance policy. The receipt during 2019 was a non-recurring
item and represented full and final settlement of the claim.
6. Post reporting date events
Since 30 June 2020 the Group has announced the decision to
cease operations at engineering facility in India. Some of
the costs associated with this exercise, which should be completed
by the end of the year, have already been absorbed and are
reflected in the first half results, with an anticipated full
year charge of approximately GBP0.5m.
7. Shareholder Communication
A copy of these condensed interim financial statements is
available from the Company's Registered Office at 4 Gilberd
Court, Newcomen Way, Colchester, Essex, CO4 9WN, UK and from
the Company's website at www.gocct.com.
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END
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