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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Newmark Security Plc | LSE:NWT | London | Ordinary Share | GB00BNYM9W73 | ORD GBP0.05 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 83.50 | 80.00 | 87.00 | 83.50 | 82.00 | 82.00 | 0.00 | 08:00:03 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Security Systems Service | 20.31M | 353k | 0.0377 | 22.15 | 7.83M |
From Apr 2019 to Apr 2024
TIDMNWT
RNS Number : 5992O
Newmark Security PLC
31 January 2019
Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR).
31 January 2019
Newmark Security plc
("Newmark", the "Company" or the "Group")
Interim Results
for the six months ended 31 October 2018
Newmark Security plc (AIM: NWT), a leading provider of electronic and physical security systems, is pleased to announce its unaudited interim results for the six months ended 31 October 2018.
HIGHLIGHTS
Financials
-- Revenue from continuing operations increased 19.5% to GBP9.8m (HY 2017: GBP8.2m) -- Operating profit from continuing operations of GBP0.5m (HY 2017: operating loss of GBP0.3m)
-- Earnings per share from continuing operations of 0.09 pence (HY 2017: loss per share of 0.10 pence)
-- Cash outflow from operating activities was GBP0.7m (HY 2017: 0.1m).
Electronic Division
-- Revenue increased by 27.7% to GBP5.06m (HY 2017: GBP3.96m) -- Human capital management revenue increased by 53.0% to GBP3.0m (HY 2017: GBP2.0m) -- Access control revenue increased by 2.4% to GBP2.03m (HY 2017: GBP1.98m)
Asset Protection Division
-- Revenue increased by 11.9% to GBP4.76m (HY 2017: GBP4.26m)
Commenting on the results, Maurice Dwek, Chairman of Newmark, said:
"The Board was pleased with the growth achieved in the first half of the year and the consequent return to profitability. The higher level of revenue within the electronic division is expected to continue in the second half of the year, although the revenue within the asset protection division is expected to be lower due to seasonality factors as in previous years and for the other reasons set out in my report in full."
"In addition, Brian Beecraft has notified the Board of his intention to retire in October this year. Brian has been the Company's Finance Director for 21 years and the Board would like to thank him for his contribution during that time."
Copies of the interim results for the six months ended 31 October 2018 will shortly be sent to shareholders and will be available on the Company's website www.newmarksecurity.com.
For further information:
Newmark Security plc Marie-Claire Dwek, Chief Executive Tel: +44 (0) 20 7355 0070 Officer www.newmarksecurity.com Brian Beecraft, Group Finance Director Allenby Capital Limited Tel: +44 (0) 20 3328 5656 (Nominated Adviser and Broker) James Reeve / Liz Kirchner
CHAIRMAN'S STATEMENT
I am pleased to announce the Group's interim results for the six months ended 31 October 2018, a period of significant growth and return to profitability.
There was an increase in Group revenue of 19.5% from GBP8,218,000 to GBP9,822,000 which included an increase in revenue within the electronic division of 27.7% from GBP3,960,000 to GBP5,056,000. This continued the strong performance in the previous financial year. Within this figure, revenue from Human Capital Management increased by 53.0% from GBP1,979,000 to GBP3,028,000 whilst access control revenues increased by 2.4% from GBP1,981,000 to GBP2,028,000. Revenue in the asset protection division increased by 11.9% from GBP4,258,000 to GBP4,766,000. The increases in revenue, combined with the cost cutting measures in previous years, resulted in an operating profit of GBP486,000 (2017: loss GBP328,000). Earnings per share from continuing operations were 0.09 pence (2017: loss per share 0.10p).
Financial summary
Electronic Division- Grosvenor Technology
Revenue GBP5,056,000 (2017: GBP3,960,000)
Human Capital Management ("HCM")
Revenue increased by 53.0% from GBP1.98m to GBP3.03m
Excluding the US operation, HCM revenue increased by 9.8% from the corresponding period last year to GBP1,560k. Revenue from the legacy range of RS terminals declined, but this was more than compensated for by an increase in revenues in the contemporary IT series. There were no significant end-user projects completed in the period, the growth coming organically across a number of well-established customers.
Revenues in our American company increased 264% from GBP558k to GBP1,468k for the six-month period. Growth was seen across all variants of the proprietary Linux based IT series terminals in addition to the first significant sales of the Android based GT-10 terminal.
We have reported previously that the US represents the greatest area of opportunity for Grosvenor Technology's HCM business due to the sheer proportion of the world's major HCM software vendors that are based in that territory. The investment made in products, services and business development activities in prior periods has continued to take effect and the impressive growth seen in the previous financial year has continued. Revenues were driven by two new major clients, Workforce Software and Ultimate Software, both of whom entered into supply agreements for their flagship terminals, as reported in previous periods.
In addition, a new project for another new customer saw orders placed for 1,000 units of the IT51 terminal complete with a 5 years software-as-a-service (SaaS) bundle. The SaaS element of this deal will contribute towards the Company's recurring revenue ambitions, which remain a key goal in the longer term. Negotiations are now underway with that customer, which is a Tier 1 HCM software vendor, with a view to that client taking an OEM variant of the GT-10 terminal. These negotiations are likely to conclude during the second half of the year.
Grosvenor is seeking to create a further supply chain in the US to support the growth in that region.
Continued development of our SaaS platforms
In the HCM markets generally, growth continues to be facilitated through the technological drivers of high-speed internet availability and the subsequent mass shift to Cloud based computing. This shift means that the traditionally challenging to serve and highly fragmented Small and Medium-Sized Business (SME/SMB) market is well within the reach of HCM providers leveraging a SaaS based business model.
Grosvenor developed the Custom Exchange and Assist IT software suite several years ago, as an 'On-Premise' deployment. Our applications remain hugely powerful solutions and key differentiators for Grosvenor, encompassing advanced data management/transformation and terminal provisioning, remote diagnostics and service capability.
Internal development has continued to focus on the provision of these added services on a 'as a service' basis, increasingly cloud-based, that aid software vendors to reap additional value from their hardware post-deployment. Grosvenor will continue to invest and develop HCM software platforms with a Cloud and API first approach, positioning the company as an accessible SaaS solution provider. This shift from "On Prem" to "Cloud SaaS" also affords the opportunity to an alternative or additional business model where Software, Services and Terminals are 'bundled' as a 'Clock as a Service' offering, generating further long-term recurring revenue potential.
Access Control
Overall, Access Control revenues remained relatively stable, with revenue of GBP2,028k compared to GBP1,981k in the corresponding period, an increase of 2.4%.
As previously reported, the Janus product is no longer installed in 'new' systems as the platform utilises an historic and now unsupported version of the MS Windows(TM) operating system. As anticipated, the Janus revenues in this period reduced to GBP570k, a fall of 14% compared to GBP663k in the corresponding period last year.
The Janus to Sateon upgrade programme was very busy as this initiative reached its conclusion at the end of the half year. In addition, the Sateon Advance hardware and software offering continued to show strong growth as an increasing number of security installers became repeat customers, as they chose to adopt the platform as their standard access control offering.
Sateon revenues were also positively affected in the period by sales of the OEM variant of the Advance hardware, which allows third parties to utilize the hardware in a non-proprietary way on their own access control platforms. To date, sales of the OEM variant have been limited to one major client, although exploratory conversations continue with a number of global third-party access control providers in the US and EMEA. As a consequence of the above factors, Sateon sales increased 10.7% to GBP1,458k.
Development in the period was focused on pre-launch work for the new Security Management System (SMS) which is being developed in conjunction with Slovakian based Gamanet a.s. The new platform is intended to be launched in the second half of the current financial year. The market is moving away from stand-alone Access Control solutions towards integrated Access Control, Intruder, CCTV and Fire and Building Management into a single platform, such as with SMS. This solution will see Grosvenor Technology remain at the cutting edge of advances in the market for access control solutions and will offer a number of third-party integrations at launch.
Asset Protection Division - Safetell
Revenue GBP4,766,000 (2017: GBP4,258,000)
Safetell revenue was 11.9% higher than the corresponding period last year, mainly as a result of the contribution from projects completed by the Service Division. This work saw the turnover of the division increase by 34.5% compared to the corresponding period last year. Trading conditions remain challenging in the products division, and the increased uncertainty of Brexit continued to result in budget cuts and cancellation of planned work within that division by customers, including the government departments that Safetell has traditionally supplied. Cost saving initiatives implemented in the period resulted in margins being maintained.
Products Division revenue was 2% lower than the corresponding period last year as a result of the delayed completion of a major project. Despite delays in the Post Office Network Transformation Programme, revenue from that source was only 1.3% lower than the previous period. However, overall Cash Handling revenue increased by 13.2% due to increased sales to new customers. The Products Division's work is mostly customer project based and revenue of non-Cash Handling equipment decreased by 6.5% as a result of fewer customer programmes. Revenue from Eclipse Rising Screens was 25.5% lower than the corresponding period last year as a result of continued branch closures by long standing financial institution customers. Revenue for Fixed Glazing products increased despite clients moving away from ballistic protection counters and screens to less secure open counter trading to improve customer relations. The second half of the financial year is expected to be challenging for the Products Division as there are no large projects in the pipeline and revenue will rely on smaller repeat orders from long standing customers and new smaller projects. The Board continues to review the level of stock holdings in the light of the ongoing uncertainty of the potential impact of Brexit.
During this period, the Service Division revenue was 34.5% higher than the corresponding period last year. Revenue growth was only partly attributable to timing of work with some programmes concentrated in the first six months of the current year. Margins were maintained due to cost cutting efforts supported by excellent service provided by our multiskilled field technicians and improved mix of work. Annual contracts were renewed as expected and we consider no change in our contract retention rates in the short term. Some new initiatives on service offering are developing and, whilst small in terms of overall revenue, there is no reason why they should not continue to grow.
We continue to explore and develop other product and service offerings, and these will reduce our reliance on rising screen and cash handling product revenue streams in the future.
Balance sheet and cash flow
Trade and other receivables increased in the six months due to the increased level of sales especially in the period prior to the end of the six months, but also due to the settlement of accounts related to large projects shortly after the period end. Inventories also increased due to the continuing higher level of activity and concerns over Brexit, but also due to the requirement to hold stock in escrow for one of the customers under the terms of their new supply agreement.
Retirement of Group Finance Director
Brian Beecraft, the Group Finance Director, has provided notice to the Company of his intended retirement in October 2019. The Board has commenced the search for a new Finance Director and further updates will be provided in due course.
Outlook
The Board was pleased with the growth achieved in the first half of the year and the consequent return to profitability. The higher level of revenue within the electronic division is expected to continue in the second half of the year, although the revenue within the asset protection division is expected to be lower due to seasonality factors as in previous years and the reasons outlined above.
M DWEK Chairman
31 January 2018
CONSOLIDATED INCOME STATEMENT
For the six months ended 31 October 2018
Hot Features
Premium
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2018 2017 2018
Notes GBP'000 GBP'000 GBP'000
Revenue 9,822 8,218 16,052
Cost of sales (year ended 30
April 2018
Including GBP698,000 exceptional
impairment of development cost) (5,891) (4,922) (10,958)
------------ ------------ --- -----------
Gross profit 3,931 3,296 5,094
Administrative expenses (including
exceptional items) 2 (3,445) (3,624) (6,971)
------------ ------------ --- -----------
Profit/(loss) from operations
before exceptional items 486 (328) (1,039)
Exceptional impairment provision
of development costs
Exceptional redundancy costs
- - (698)
- - (140)
------------------------------------ ------ ------------ ------------ --- -----------
Profit/(loss) from operations 486 (328) (1,877)
Finance costs (25) (25) (50)
461 (353) (1,927)
Tax (charge)/credit 3 (29) (96) 172
------------ ------------ --- -----------
Profit/(loss) for the period
/year from continuing operations
Loss of discontinued operation
net of tax 432 (449) (1,755)
2 - - (113)
Profit/(loss) for the period/year 432 (449) (1,868)
============ ============ === ===========
Attributable to:
- Equity holders of the parent 432 (449) (1,868)
Earnings/(loss) per share
- Basic (pence) 4 0.09p (0.10p) (0.40p)
============ ============ === ===========
- Diluted (pence) 4 0.09p (0.10p) (0.40p)
============ ============ === ===========
Earnings/(loss) per share from
continuing operations
- Basic (pence) 4 0.09p (0.10p) (0.38p)
============ ============ === ===========
- Diluted (pence) 4 0.09p (0.10p) (0.38p)
============ ============ === ===========
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 31 October 2018
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2018 2017 2018
GBP'000 GBP'000 GBP'000
Profit/(loss) for the period/year 432 (449) (1,868)
Foreign exchange gains on retranslation
of overseas operation 1 (15) (8)
------------ ------------ ----------
Total comprehensive income for the
period/year 433 (464) (1,876)
------------ ------------ ----------
Attributed to:
* Equity holders of the parent 433 (464) (1,876)
------------ ------------ ----------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 31 October 2018
Unaudited Unaudited Audited
31 October 31 October 30 April
2018 2017 2018
GBP'000 GBP'000 GBP'000
ASSETS
Non-current assets
Property, plant and equipment 486 522 378
Intangible assets 4,737 5,777 4,734
Total non-current assets 5,223 6,299 5,112
============ ============ ==========
Current assets
Inventory 2,199 1,538 1,608
Trade and other receivables 4,356 3,315 2,834
Cash and cash equivalents 658 641 1,069
Total current assets 7,213 5,494 5,511
------------ ------------ ----------
Total assets 12,436 11,793 10,623
============ ============ ==========
LIABILITIES
Current liabilities
Trade and other payables 3,667 2,932 3,051
Other short term borrowings 1,192 81 491
Provisions - 100 -
Total current liabilities 4,859 3,113 3,542
------------ ------------ ----------
Non-current liabilities
Long term borrowings 115 51 53
Provisions 100 100 100
Deferred tax 5 193 4
Total non-current liabilities 220 344 157
------------ ------------ ----------
Total liabilities 5,079 3,457 3,699
TOTAL NET ASSETS 7,357 8,336 6,924
============ ============ ==========
Capital and reserves attributable
to equity holders of the company
Share capital 4,687 4,687 4,687
Share premium reserve 553 553 553
Merger reserve 801 801 801
Foreign exchange difference
reserve (132) (140) (133)
Retained earnings 1,408 2,395 976
7,317 8,296 6,884
Minority interest 40 40 40
------------ ------------ ----------
TOTAL EQUITY 7,357 8,336 6,924
============ ============ ==========
CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 31 October 2018
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2018 2017 2018
(restated)
GBP'000 GBP'000 GBP'000
Cash flow from operating activities
Net profit/(loss) after tax
from ordinary activities 432 (449) (1,868)
Adjustments for:
Depreciation, amortisation and
impairment 357 505 1,582
Interest expense 25 25 50
Gain on sale of property, plant
and equipment (20) (21) (21)
Income tax expense/(credit) 29 96 (80)
Operating profit/(loss) before
changes in working capital and
provisions 823 156 (337)
(Increase)/decrease in trade
and other receivables (1,506) (28) 453
(Increase)/decrease in inventories (586) 103 38
Increase/(decrease) in trade
and other payables 572 (356) (349)
Cash generated from operations (697) (125) (195)
Income taxes paid (4) - -
Cash flows from operating activities (701) (125) (195)
------------ ------------ ----------
Cash flow from investing activities
Payment for property, plant
and equipment (117) (1,548) (1,576)
Sale of property, plant and
equipment 20 1,493 1,525
Research and development expenditure (173) (475) (368)
(270) (530) (419)
------------ ------------ ----------
Cash flow from financing activities
Bank loan received - 840 840
Bank loan repaid - (840) (840)
Repayment of finance lease creditors (31) (45) (80)
Proceeds from invoice discounting 616 - 447
Interest paid (25) (25) (50)
560 (70) 317
------------ ------------ ----------
Decrease in cash and cash equivalents (411) (725) (297)
Cash and cash equivalents at
beginning of period/year 1,069 1,370 1,370
Exchange difference on cash
and cash equivalents - (4) (4)
------------ ------------ ----------
Cash and cash equivalents at
end of period/year 658 641 1,069
============ ============ ==========
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Share Merger Foreign Retained Non-controlling Total
capital premium reserve exchange earnings interest
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 May 2018 4,687 553 801 (133) 976 40 6,924
Profit for the
period - - - - 432 - 432
Other comprehensive
income - - - 1 - - 1
--------- --------- --------- ---------- ---------- ---------------- --------
Total comprehensive
income for the
period - - - 1 432 - 433
--------- --------- --------- ---------- ---------- ---------------- --------
As at 31 October
2018 4,687 553 801 (132) 1,408 40 7,357
--------- --------- --------- ---------- ---------- ---------------- --------
At 1 May 2017 4,687 553 801 (125) 2,844 40 8,800
Loss for the period _ _ _ _ (449) _ (449)
Other comprehensive
income _ _ _ (15) _ _ (15)
--------- --------- --------- ---------- ---------- ---------------- --------
Total comprehensive
income for the
period _ _ _ (140) (449) _ (464)
--------- --------- --------- ---------- ---------- ---------------- --------
As at 31 October
2017 4,687 553 801 (140) 2,395 40 8,336
--------- --------- --------- ---------- ---------- ---------------- --------
NOTES TO THE UNAUDITED INTERIM RESULTS FOR THE SIX MONTHSED 31 OCTOBER 2018
1. BASIS OF ACCOUNTS
The financial information for the six months ended 31 October 2018 and 31 October 2017 does not constitute the Group's statutory financial statements for those periods within the meaning of Section 434(3) of the Companies Act 2006 and has neither been audited or reviewed pursuant to guidance issued by the Auditing Practices Board. The annual financial statements of Newmark Security PLC are prepared in accordance with IFRS as adopted by the European Union. The principal accounting policies used in preparing the interim results are those that the Group expects to apply in its financial statements for the year ended 30 April 2019 and are unchanged from those disclosed in the Group's Annual Report for the year ended 30 April 2018.
The comparative financial information for the year ended 30 April 2018 included within this report does not constitute the full statutory accounts for that period. The statutory Annual Report and Financial Statements for 2018 have been filed with the Registrar of Companies. The Independent Auditors' Report on that Annual Report and Financial Statement for 2018 was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498(2)-498(3) of the Companies Act 2006.
After making enquiries, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the half-yearly condensed consolidated financial statements.
2. ADMINISTRATIVE EXPENSES
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2018 2017 2018
GBP'000 GBP'000 GBP'000
Exceptional redundancy
costs - - 140
Other 3,445 3,624 6,831
3,445 3,624 6,971
============ ============ ==========
3. TAXATION
The tax charge is based on the results for the period after adjustment for losses brought forward.
4. EARNINGS PER SHARE
Earnings per share has been calculated based on the weighted average number of shares in issue during the period, which was 468,732,316 shares (2017: 468,732,316).
5. DIVIDENDS
No interim dividend is proposed (2017: Nil).
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR BRGDBUUXBGCG
(END) Dow Jones Newswires
January 31, 2019 02:00 ET (07:00 GMT)
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