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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Smartspace Software Plc | LSE:SMRT | London | Ordinary Share | GB00BYWN0F98 | ORD SHS 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 90.00 | 85.00 | 95.00 | 91.50 | 90.00 | 90.00 | 2,907 | 08:00:06 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Phone Comm Ex Radiotelephone | 7.15M | -2.74M | -0.0946 | -9.51 | 26.05M |
From Apr 2019 to Apr 2024
TIDMSMRT
RNS Number : 2965Y
Smartspace Software PLC
08 May 2019
8 May 2019
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 ("MAR"). Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.
SmartSpace Software plc
("SmartSpace", the "Group" or the "Company")
UNAUDITED FINAL RESULTS ANNOUNCEMENT
For the year ended 31 January 2019
"A year of successful transition"
SmartSpace Software plc (AIM: SMRT), the leading provider of 'Integrated Space Management Software' for smart buildings, commercial spaces and hospitality, announces its unaudited final results for the year ended 31 January 2019.
Financial Highlights:
-- Revenue from continuing operations up 2.8% to GBP6.3 million (2018: GBP6.1million) -- Adjusted LBITDA* GBP2.66 million (FY18: EBITDA: GBP0.2 million) -- Loss before tax from continuing operations of GBP4.2 million (FY18: loss GBP0.7 million) -- Profit from disposal of subsidiaries GBP2.95 million (FY18: GBPnil) -- Net cash position at 31 January 2019 GBP7.6 million (FY18: GBP1.2 million)
Operational Highlights:
-- In June 2018, completed a successful sale of the Systems Integration and Managed Services divisions for a total consideration of GBP21.6 million (net proceeds of GBP17m taking into account transaction casts and cash adjustments);
o GBP19.6 million payable in cash on completion;
o GBP2.0 million payable, subject to completion of an already contracted project by Redstone Converged Solutions Ltd.
o Intra-group loans of GBP1.4m owed by the Company were also waived
-- Successful rebranding of the Company as SmartSpace Software Plc
-- Acquisition of 100% of the share capital of SwipedOn Limited on 15 October 2018, a company registered in New Zealand:
o total consideration of GBP5.5 million (NZ$ 11.0 million), satisfied by GBP4.3 million in cash (NZ$ 8.6 million) and GBP1.2 million (NZ$ 2.4 million) in equity.
o Between acquisition and year end the SwipedOn customer base has grown by 19% from 2,279 to 2,713.
-- Signed distribution agreement with Evoko (a leading panel manufacturer) to resell SmartSpace technology through their global distribution channel
-- Material contracts for our SmartSpace platforms
o Leading International Bank - 5 year licence for Workspace Management Software - 86,000 employees across 650 floors, 60 countries and 2,800 meeting rooms
o GBP1.25m, 5-year hospitality contract win - software platform for ticketing/event management & analytics
-- Investment in software platform and scaling up of our development capacity: Launch of SmartSpace V2
-- Board changes
o Frank Beechinor appointed as Chief Executive Officer (18 June 2018)
o Guy van Zwanenberg appointed as Chairman (18 June 2018)
o Bruce Morrison appointed Chief Financial Officer (27 November 2018)
-- Appointment of senior executives to manage development implementation and sales
On outlook, Frank Beechinor, CEO of SmartSpace commented:
"Our plan in the coming year is to continue to invest into sales and marketing to enterprise and mid-market companies to maximise the opportunity we see for workplace technology, both in the UK and overseas. This sales and marketing effort will also include further development of channel sales opportunities. During the coming year we expect to see increased sales from partners, in particular via Evoko, who operate through 400 resellers and distributors across the globe. SwipedOn has performed exceptionally well between the time of acquisition and period end. More importantly, this momentum has continued into the current financial year with continued growth in customers, low cost of acquisition, low churn and increasing revenue per client. At 30 April 2019 the SwipedOn customer base had grown further to 3,063 customers, an increase of nearly 35% since SwipedOn became part of the Group. SwipedOn had its busiest month ever in March 2019 with 160 new customers signing up. We have also seen increased traction in new country markets including Germany, The Netherlands, Denmark, Sweden and Singapore.
"We will continue to focus our UK software development resources on our workplace software platform with the aim of enhancing the existing offering, allowing us to maintain competitive differentiation through technical innovation.
"Following the success of SwipedOn, we will continue to explore acquisition opportunities that deliver either complementary software functionality or have the potential to increase our customer base and geographical reach."
A copy of these unaudited final results and further information on the Company is available on the Company's website at: www.smartspaceplc.com. Copies of the report and accounts will be available from the Company's website in due course and notification will be made when they become available.
Enquiries
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SmartSpace Software Plc via Lisa Baderoon
Frank Beechinor (CEO) - Head of Investor
Bruce Morrison (CFO) Relations
Lisa Baderoon (Head of Investor Relations)
lbaderoon@smartspaceplc.com +44(0) 7721 413
496
N+1 Singer (NOMAD & Broker)
Shaun Dobson, Head of Corporate Finance
Lauren Kettle, Corporate Finance +44 (0)20 7496 3000
About SmartSpace Software Plc
SmartSpace Software plc (AIM:SMRT) is a SaaS-based technology business, designing and building smart software solutions. The Company's software solutions in workspace and hospitality help transform employee and customer engagement with modules which include: desk management, meeting room management, wayfinding, car parking, visitor management, frictionless vending, ticketing, loyalty management and analytics.
For more information go to: www.smartspaceplc.com
Chairman's Statement
FY19 has been a year of transformational change for SmartSpace. In May 2018 the Company announced the disposal of its Systems Integration and Managed Services divisions which substantially changed the Group. The Board had for some time considered that the growth prospects for these divisions, with their lack of forward visibility of revenues, were lower than for the software business and it was decided that the Group should focus on higher margin business in a less mature market with better visibility of revenues and with significant potential to grow internationally.
The Board believes that by focusing investment on the development of the Software division, there is greater scope to build higher levels of better quality recurring earnings and therefore generate more attractive returns for shareholders over the longer term.
The Board considers that the disposal terms represented a good return for both the Company and our shareholders. The two businesses were acquired for a combined consideration of GBP11.9 million in 2014 and 2016 and sold for GBP21.6 million, of which GBP19.6 million was payable in cash on completion, and GBP2.0 million payable, subject to completion of an already contracted project by Redstone Converged Solutions Ltd. The disposal group had net assets of GBP19.4 million at the date of disposal (including cash of GBP4.0 million) and realised a gain on disposal of GBP2.9 million after deducting disposal costs of GBP0.7 million. The Group has received GBP1.0 million of the deferred consideration at the balance sheet date and expects to collect the balance in the coming months.
Following the disposal, the Company changed its name to SmartSpace Software plc to reflect its transition into a pure-play software business focussed on SaaS solutions to help our customers optimise their corporate real estate. As part of this transformation the Group completed the acquisition of SwipedOn Limited ("SwipedOn") in October 2018 for a total purchase price of GBP5.5m of which GBP4.3m was satisfied by cash and GBP1.2m by the issue of new shares in the Company. SwipedOn, which is based in New Zealand, is a fast -growing SaaS business offering a visitor management solution to customers around the globe on a monthly subscription basis. The acquisition of SwipedOn directly aligns with the Group's strategy of growing recurring annuity- based SaaS revenues diversifies the Group's product range to include entry level, self-serve customers in the workplace market.
Since the acquisition we have focussed on customer acquisition and have seen a net increase of 19% in customer numbers to 2,713 as at 31 January 2019. This has resulted in a 15% increase in annual recurring revenue from $1.64m at the end of September 2018 to $1.89m at the end of January 2019. As we move into FY20 we continue our focus on customer acquisition but will also look to increase the average revenue per customer (ARPU) new pricing plan and the development of add-on modules which can be sold to both existing and new customers.
The change to a focussed software business has necessitated a significant investment in development and personnel in FY19 which is continuing in FY20. The Group has recruited a number of senior personnel to manage not only software development but also to ensure we have a proficient professional services capability to deploy enterprise and mid-market customers. As a result, the Group has recently been able to announce the signing of significant contracts with a leading international bank and a leading hospitality company.
Employees
The Group now employs around 130 people (including onshore and offshore contractors) around the world. A motivated and committed workforce is vital to the continuing development of the Group and would like to thank all the staff for their continuing hard work, dedication and loyalty to the Group. Most staff have been granted options under the Company share option scheme and their interests are therefore aligned with those of shareholders.
Board changes
In June 2018, following the disposal of the Systems Integration and Managed Services divisions, Mark Braund stepped down as chief executive, having successfully managed the Group through its restructuring and disposals. At the same time Frank Beechinor moved from non-executive chairman to become CEO and I took over as non-executive chairman. Frank has significant relevant experience for the ongoing business through his successful involvement with dotDigital and OneClick HR.
In November 2018 Spencer Dredge moved to the position of Chief Operations Officer and stepped down from the main board. In his new role Spencer's focus is on integration of the business units, driving operational efficiencies and identifying and integrating future strategic acquisition opportunities. At the same time Bruce Morrison was appointed to the Board as Chief Financial Officer and brings with him extensive software industry experience and financial expertise.
Outlook
The funds realised from the disposal of the Systems Integration and Managed Services divisions have allowed us to develop the Software division through investment in research and development and the acquisition of SwipedOn, and the recent release of version 2.0 of our SmartSpace platform represents a significant milestone for the Group.
We will continue with investment in our software platform and to review options to accelerate growth and build shareholder value. We will also continue to build our direct and indirect sales and marketing capability to ensure we deliver the revenue growth we need for the Group to support the Board's ambition of reaching profitability in the next two years.
The Group has a renewed focus and strategic goal of becoming a leading SaaS based software company providing a range of solutions to help customers optimise their corporate real estate. SmartSpace is emerging as a leader in the fast growing 'smart office' software market, and we look forward with optimism to the next phase of the Group's development.
Guy van Zwanenberg
Chairman
7 May 2019
Strategic Report: strategy and operational review
Business model and strategy
At the start of the financial year, the Group had three divisions: Systems Integration, Managed Services and Software. The Systems Integration division was characterised by large, low margin projects, which the Board considered were not conducive to delivering significant international revenue growth. As highlighted in the chairman statement, the Board took a strategic decision to dispose of the Systems Integration and Managed Services divisions. The disposal was completed on 18 June 2018 and realised net cash proceeds (after deducting costs and cash in the subsidiaries disposed) of GBP17.9m in FY19 with a further GBP1m to be received in FY20.
Following the disposal, the Board has directed the focus of the Group's resources to the Software division, which sells software to help companies optimise the use of their corporate real estate and set the following strategic priorities:
-- to develop technology-led intellectual property to help companies optimise use of their corporate real estate;
-- to develop new sales channels to market for our software solutions, focusing where possible on SaaS arrangement;
-- to continue with a strategy of both organic and acquisitive growth both in our domestic market and overseas; and
-- to deliver higher quality earnings which, in turn, improve cash generation.
The Board believes the disposal allows us to accelerate growth of the Software division by providing the capital to further invest in the SmartSpace software platform. These financial resources will also allow us to develop the Group's route to market through expanding our sales and marketing capability and opening indirect sales channels through partnership agreements, the first of which has been signed with Evoko, a leading panel manufacturer. Finally, the proceeds also provide the financial resources to capitalise on potential targeted acquisition opportunities.
The office real estate market is constantly evolving as changes in working practices, demographics and technology are reflected in the office space which businesses provide for their employees. Faced with challenges of rising costs of office space in major global cities, businesses are increasingly looking for ways in which they can improve the return on investment from their corporate real estate and the demand for technology solutions to address these challenges is growing internationally. The strategy for our Software division is to focus on developing our software to take advantage of these exciting opportunities afforded by this fast-growing market.
The SmartSpace platform is a single integrated solution offering a number of modules. Our desk management module can track utilisation of desks and facilitates 'hot-desking', whilst our meeting room management module allows the booking of meeting rooms from multiple touch points to ensure efficient use of this valuable space. The visitor management module provides visitor registration functionality for organisations facilitating a more efficient check-in process and ensures compliance with GDPR and other regulatory requirements. Other modules include wayfinding, car parking and analytics.
The SmartSpace software platform has been developed to an open-architecture standard, is deployable both on-premise and via the Cloud and has a secure API layer, allowing easy integration with third party applications. The data gathering, analytics and dashboard functionality enables customers to deploy mobile and agile working strategies, configuring so as to achieve increased engagement with the workforce whilst realising significant cost benefits for clients. Users access SmartSpace via a mobile app, web portal or touchscreen kiosks.
To date most of our customers have been enterprise level customers as evidenced by the announcement of two material contracts in FY19, one with a leading international bank and a second one with a leading hospitality company. Whilst enterprise customers provide significant revenues, they tend to have a longer sales cycle, are complex to deploy and there are a limited number to target. As the Group moves into FY20, we are focussed on developing channel sales opportunities with the aim of increasing our reach into the mid-market. The acquisition of SwipedOn has provided us with a significant base of international clients at the entry level. This business is characterised by shorter sales cycle, promoted through digital marketing and self-serve onboarding of new clients.
Review of the business
The impact of the disposals can be seen in the Company's financial performance in 2019. We have restated the 2018 income statement to exclude revenues and expenditure from discontinued operations, which are now presented as part of the gain on the disposal in the income statement. The Group has retained Anders & Kern Limited which was acquired in 2017 and whose results were previously reported as part of the Systems Integration division. This company continues to offer hardware and system integration services, including meeting room panels which integrate with our software.
Revenues from continuing operations have increased by 2.8% from GBP6.14 million in FY18 to GBP6.3 million in FY19 although the FY18 revenues included one OEM software sale of GBP2.25 million so the real increase is much more significant. Adjusted EBITDA in FY19 was a loss of GBP2.7 million compared with a profit of GBP0.2 million in FY18 reflecting the additional overheads as the Group builds the team in the Software Division to enable the delivery of the strategy of transforming SmartSpace into a leading international provider of workplace optimisation technology products.
The breakdown of revenues by type is:
2019 2018
--------
GBP'000 GBP'000
----------------------------- -------- --------
Recurring revenue
----------------------------- -------- --------
SaaS 385 105
----------------------------- -------- --------
Maintenance contracts 59 20
----------------------------- -------- --------
Total recurring revenue 444 125
----------------------------- -------- --------
Non-recurring revenue
----------------------------- -------- --------
Licences 2,138 3,088
----------------------------- -------- --------
Professional services 960 814
----------------------------- -------- --------
Hardware 2,765 2,110
----------------------------- -------- --------
Total non-recurring revenue 5,863 6,012
----------------------------- -------- --------
Total revenue 6,307 6,137
----------------------------- -------- --------
Recurring revenue comprises contractual fees for ongoing software and services including SaaS, hosting and software support. Non-recurring revenue is all revenue other than recurring revenue and generally comprises software licences, professional services and hardware.
On the face of it, the above revenue split indicates that the Group made slow progress in its aim to transition the business from a licence to a SaaS model. However, whilst the recurring revenue was still at low levels in FY19, contracts signed in FY19 mean that the base for the FY20 is already a multiple of what was reported in FY18. At 31 January 2019 the annual run rate of recurring revenues had increased to GBP1.39 million (FY20 GBP249,000). This is before we sign any new contracts in the current financial year. The Group is therefore starting to develop a good base of SaaS revenue which will benefit future years.
The financial performance of the Group for the year is covered in more detail in the Financial Review.
Software development
During the year we invested GBP2.9 million to improve scalability and enable our technology to operate on multiple cloud platforms. This included investing in our onshore and offshore development teams and increasing our product management and testing capabilities. This culminated in the recent release of SmartSpace version 2.0. In addition, we have integrated with Liso, a well-established meeting room panel product sold across the globe by Swedish manufacturer, Evoko. Our software team are also working with Evoko to develop the software to operate their next generation of meeting room panels to be launched during the calendar year 2019 which will provide the Group with a new revenue stream.
We continue to invest in our unique mobile application which allows both staff and visitors use their mobile device to book desks and/or meeting rooms, for location-based services including wayfinding and to use other services such as catering or transport. Future development will focus on configuration tools to enhance the customer experience of the software and APIs to allow easy integration with other applications.
Acquisition
We have also expanded our product offering and increased our range of customers we serve with the acquisition of SwipedOn in October 2018. Based in New Zealand, SwipedOn is a fast-growing SaaS business which offers a visitor management solution on a monthly subscription to customers around the globe. The SwipedOn product is highly complementary to SmartSpace's existing software offering as well as providing the Group with a self-serve solution aimed at the entry level market. The strategy since acquisition has been to focus on customer acquisition and, as a result, SwipedOn customer numbers have increased by an average 124 per month to 2,713 at 31 January 2019. The aim is to continue to focus on new customer acquisition but also increase the APRPU (average revenue per user) through a combination of new pricing plans and the release of add-on modules leveraging SmartSpace's existing software offering. Churn remains low at less than 6% on an annual basis and the business is achieving a healthy lifetime value to customer acquisition cost (LTV: CAC) ratio of 5.5x. The annual recurring revenue at the end of FY19 was NZ$1.9 million (approximately GBP1 million) which represents growth of 15% in the three months since acquisition, and this has continued into FY20 when it increased to over NZ$2.2 million (approximately GBP1.2 million) at the end of April 2019.
Rebranding
In July 2018 RedstoneConnect was rebranded to SmartSpace Software plc giving clarity of identity for both the Company and our products. As part of this transition and in reviewing ways to maximise shareholder value we vacated our offices in central London and moved our main operating base to our existing location in Luton, supported by ancillary offices in Mildenhall and Bristol.
People
The focus post disposal of the RedstoneConnect business has been to build a scalable software development organisation. This involved strengthening the senior management team with the appointment of Alex Rehm as CTO. Since his arrival Alex has grown his team of software developers, designers and testers. As well as running our Anders & Kern business Steven Black was appointed Chief Revenue Officer with responsibility for direct and indirect sales. Steve Batten joined as Chief Customer Officer with the aim of building an implementation and support organisation capable of supporting and deploying the SmartSpace platform into enterprise and mid-market clients. Keith Jump, previously CTO, moved to the role of Chief Strategy Officer and Spencer Dredge, previously CFO, has become COO.
During the past year we have relied on a significant number of UK-based contractors to accelerate our software development programme. Since December we have replaced a number of these contractors with less expensive UK full-time staff or offshore contractors.
Outlook
The Board believes there are substantial opportunities for international growth in the workspace management market, particularly in light of increasing interest in agile working and the connected office environment. We see this growth potential at each level in the market - enterprise, mid-market and self-serve (entry level).
SmartSpace is in a strong position to capitalise on this potential following the investment made in developing our software platform and implementation capability. Our 'single platform, seven modules' approach has enabled the Group to sign two material enterprise contracts in the second half of the financial year. We entered FY20 with an increased interest in our product offering with a number of early engagements giving us confidence that we can secure new client mandates over the coming months. We have also appointed our first employees in the US and are uncovering interesting opportunities in that market.
The opportunity in the corporate real estate market, which enables employee and visitor engagements through software technology, continues to gather pace and we are ideally positioned to benefit from this potential. In January 2019, due to the struggles of the retail market combined with the level of investment required to continue the development of this platform, we decided not to pursue further clients for our retail platform. This strategic decision allows the Group to focus its software development and sales efforts on the workplace and hospitality markets.
Customer numbers at SwipedOn continue to grow at an impressive rate and at 30 April 2019 our customer base stood at 3,063 customers across 4,048 locations in 39 countries. When we acquired this business, we set ourselves the objective of getting to 3,500 customers and we are on target to achieve this number in the coming months. SwipedOn moved to a new billing platform in January 2019 and we introduced a new price plan which is turn has resulted in a 6% increase in ARPU with the potential to increase ARPU further as the new price plan is rolled out across the entire customer base. Our international reach is also growing, and we now have in excess of 1,000 customers in the US, over 700 in UK, 400 in Australia and 300 in New Zealand. Since acquisition we have seen increased traction in new international markets and secured our first customers in Germany, Holland, Singapore, Sweden, Ireland and Denmark. It is our intention to launch our first add-on modules for SwipedOn during FY20 which will allow us to further increase ARPU. The first of these planned modules is Deliveries, allowing customers to handle couriers and packages at reception. Other modules planned include meeting rooms, car parking and desk management, giving us a full range of space optimisation functionality at the self-serve end of the market. In addition, we expect to see increased upsell opportunities from the SwipedOn customer base for our mid-market and enterprise solutions.
Our plan in the coming year is to continue to invest into sales and marketing to enterprise and mid-market companies to maximize the opportunity we see for workplace technology in the UK and overseas. This sales and marketing effort will also include further development of channel sales opportunities. During the coming year we expect to see increased sales from partners, in particular via Evoko, who operate through 400 resellers and distributors across the globe.
We will focus our UK and offshore software development resources on SmartSpace with the aim of enhancing the existing offering and ensuring we maintain competitive differentiation through technology innovation.
Following the success of SwipedOn, we will continue to explore acquisition opportunities that deliver either complementary software functionality or have the potential to increase our customer base and geographical reach.
Finally, on behalf of the Board, I would like to thank my colleagues for their hard work. The quality and commitment of our staff is our biggest strength and this is clearly illustrated by what they have achieved during this transformational year for SmartSpace.
Frank Beechinor
Chief Executive Officer
7 May 2019
Strategic report: Financial review
Overview
On 18 June 2018 the Group completed the disposal of the Systems Integration and Managed Services Divisions. As a result, the income and expenditure of the divisions disposed including interest and tax, together with the gain on disposal has been included as discontinued operations in the income statement. Furthermore, the income and expenditure from those divisions has been excluded from the comparative amounts and included as discontinued operations in the income statement. There have been changes to the presentation of certain assets and liabilities in the balance sheet as a result of implementing IFRS 15 'Revenue from contracts with customers' and IFRS 9 'Financial Instruments' although there has been no requirement to restate prior year's results or opening reserves.
Revenue for the year from continuing operations was GBP6.31 million (2018: GBP6.14 million). Adjusted EBITDA (as defined in note 3b) was a loss of GBP2.7 million (2018: profit GBP0.2 million) and operating loss was GBP4.14 million (2018: GBP0.62 million). The Board is not recommending the payment of a dividend this year.
Revenue
2019 2018
--------
GBP'000 GBP'000
----------------------- -------- --------
Recurring revenue 444 125
----------------------- -------- --------
Non recurring revenue 3,098 3,902
----------------------- -------- --------
Software and services 3,542 4,027
----------------------- -------- --------
Hardware 2,765 2,110
----------------------- -------- --------
Total revenue 6,307 6,137
----------------------- -------- --------
Software and services revenues comprise revenues from the SmartSpace platform and SwipedOn. The non-recurring revenues for FY18 include GBP2.25 million in respect of a one-off OEM software sale. Hardware revenues of GBP2.77 million (FY18: GBP2.11 million) comprise revenues from the Hardware and Systems Integration division and some hardware from the Software division where that hardware is sold as part of a software sale.
Recurring revenues of GBP444,000 (FY18: GBP125,000) comprise the SaaS revenues and software maintenance revenues and include GBP272,000 from SwipedOn which was acquired in October 2018. At 31 January 2019 the annual run rate of recurring revenues had increased to GBP1.39 million (FY18: GBP249,000).
Gross profit
The gross profit has decreased by 16.6% to GBP3.75 million (FY18: GBP4.50 million) reflecting the increase in revenue from hardware and the one off OEM sale in FY18.
Operating expenses
2019 2018
--------
GBP'000 GBP'000
------------------------------------------- -------- --------
R&D 1,138 94
------------------------------------------- -------- --------
Sales and G&A 5,286 4,189
------------------------------------------- -------- --------
Share -based payment charge (38) 82
------------------------------------------- -------- --------
Depreciation and amortisation 773 364
------------------------------------------- -------- --------
Impairment of intangible assets 297 -
------------------------------------------- -------- --------
Reorganisation and transformational costs 445 389
------------------------------------------- -------- --------
Total operating costs 7,901 5,118
------------------------------------------- -------- --------
The Group continues to invest in research and development of new products and increased spend to GBP2.92 million (FY18: GBP1.33 million) of which GBP1.78 million (FY18: GBP1.23 million) was capitalised.
Sales and G&A costs increased by 26% to GBP5.29 million (FY18: GBP4.19 million) of which 11% related to the acquisition of SwipedOn and a full year's contribution from Anders & Kern Limited. The remaining increase reflects the investment the Group has made in strengthening the management team within the Software division.
The increased depreciation and amortisation of GBP773,000 (FY18: GBP364,000) arises as a result of the increased spend on research and development and amortisation of the acquired intangibles relating to the SwipedOn acquisition.
Exceptional items within operating expenses include:
-- Reorganisation and transformational costs of GBP445,000 (FY18: GBP389,000)
-- Impairment of previously capitalised research and development costs following the decision not to pursue further revenue from the retail sector
Taxation
The taxation credit on continuing operations of GBP1.73 million comprises current tax of GBP445,000 which relates principally to cash recoverable on R&D tax credits and deferred tax of GBP1.29 million representing tax losses recognised as an asset in the balance sheet net of timing differences on property, plant and equipment and intangible assets.
Earnings per share
The loss per share was 2.83p compared with earnings per share of 7.69p for FY18 and the loss per share from continuing operations was 11.72p (FY18: loss per share 1.86p).
The adjusted loss per share from continuing operations which excludes the after-tax impact of discontinued operations, exceptional items, share-based payments and the amortisation of intangible assets recognised on acquisition was 8.39p (FY18: earnings per share 0.65p).
Intangible assets and goodwill
Following the disposal of the Systems Integration and Managed Services Divisions, the acquisition of SwipedOn and the ongoing investment in research and development, Group intangible assets have decreased by GBP5.19 million to GBP11.26 million at 31 January 2019 of which GBP7.13 million is goodwill compared with GBP12.23 million at 31 January 2018.
Cash flow
The net cash outflow from operations was GBP3.50 million (FY18: GBP2.32 million) of which an outflow of GBP3.60 million (FY18: GBP1.81 million) related to continuing operations and an inflow of GBP130,000 (2018: outflow GBP501,000) arose from discontinued operations. The cashflow from continuing operations was adversely affected by the increase in accrued income of GBP714,000 as a result of software licences recognised in 2019 and not yet invoiced and trade receivables of GBP1.1 million, which related primarily to the final amount due on an OEM software sale from 2018. This was settled in February 2019, shortly after the year end.
The Group received net disposal proceeds of GBP15.97 million from the disposal of the Systems Integration and Managed Services Divisions comprising the cash on completion of GBP19.6 million, deferred consideration received of GBP1.0 million less disposal costs of GBP701,000 and cash disposed of in the disposal group of GBP3.93 million. The Group has used these proceeds to fund the net cash from operations of GBP4.83 million and has also reinvested some of those disposal proceeds in the acquisition of SwipedOn Limited for GBP3.97 million, capital expenditure including development of GBP2.12 million and the repayment of borrowings of GBP1.8 million.
Overall the net cash inflow was GBP4.61 million compared with a net inflow of GBP248,000 for FY2018.
Financial position
The Group had cash balances at 31 January 2019 of GBP8.05 million (FY18: GBP3.44 million) and borrowings of GBP426,000 (FY18: GBP2.23 million). The borrowings comprise a mortgage on the Group's freehold property in Mildenhall.
At 31 January 2019 the Group had equity of GBP23.47 million (FY18: GBP22.40 million) and net current assets of GBP9.4 million (FY18: GBP6.04 million) including contract assets of GBP698,000 (FY18: GBP6.70 million) and trade receivables of GBP2.02 million (FY18 GBP5.64 million). The Group has a further GBP1.56 million of accrued income in non-current assets. The requirement to fund working capital has been significantly reduced following the disposal of Systems Integration and Managed Services Divisions.
The other financial assets include GBP1.0 million out of a total of GBP2.0 million deferred consideration which was retained by the purchaser for working capital purposes at the date of acquisition. It relates to a contract asset in respect of a customer contract which was due to be recovered after the completion of the sale. As the value of contract asset reduces over time the contingent consideration is repayable to the Group. In the event that the value of the contract asset exceeds the contingent consideration the Group may be required to provide additional funding to cover the excess of the contract asset over the value of the contingent consideration. At 31 January 2019 no additional working capital has been provided and GBP1.0 million has been paid to the Group. The remaining GBP1.0 million included in other financial assets at amortised cost is expected to be fully recovered in the current financial year.
Trade receivables at 31 January 2019 includes an amount of GBP750,000 in respect of an OEM software sale in 2018 and which was settled in full shortly after the year end and further amount of GBP385,000 in respect of one customer which was invoiced in December 2018 and paid in full after the year end in accordance with the payment terms for that customer.
Dividend policy
The Group reported a retained loss of GBP599,000 (FY18: profit of GBP1.51 million), which has been transferred to reserves. At 31 January 2019, the Company had retained earnings (including the gain on disposal of subsidiaries) of GBP23.84 million (FY18: GBP24.13 million). The Board considers that it is in shareholders' best interests to retain resources in the Group to invest in further software development and potential acquisitions. However, should it become apparent in the next 24 months that not all of the available resources are required, the Board will consider implementing a distribution policy or return of capital to shareholders.
Bruce Morrison
Chief Financial Officer
7 May 2019
Consolidated statement of comprehensive income
Note Unaudited Audited
2019 2018
---- ---------
GBP'000 GBP'000
----------------------------------------- ---- --------- -------
Continuing operations
----------------------------------------- ---- --------- -------
Revenue from contracts with customers 3 6,307 6,137
----------------------------------------- ---- --------- -------
Costs of sale of goods (1,848) (1,374)
----------------------------------------- ---- --------- -------
Cost of providing services (710) (266)
----------------------------------------- ---- --------- -------
Gross profit 2 3,749 4,497
----------------------------------------- ---- --------- -------
Administrative expenses (7,901) (5,118)
----------------------------------------- ---- --------- -------
Net impairment losses on financial
and contract assets (30) -
----------------------------------------- ---- --------- -------
Other income 39 -
----------------------------------------- ---- --------- -------
Operating loss (4,143) (621)
----------------------------------------- ---- --------- -------
Adjusted EBITDA* (2,666) 213
Reorganisation and transactional items
included within administrative expenses (445) (389)
Depreciation (93) (73)
Amortisation (680) (291)
Impairment of intangible assets (297) -
Share based payment charge 38 (81)
----------------------------------------- ---- --------- -------
Operating loss (4,143) (621)
----------------------------------------- ---- --------- -------
Finance income 51 -
----------------------------------------- ---- --------- -------
Finance costs (121) (120)
----------------------------------------- ---- --------- -------
Loss before tax (4,213) (741)
----------------------------------------- ---- --------- -------
Taxation 1,730 377
----------------------------------------- ---- --------- -------
Loss for the year after tax (2,483) (364)
----------------------------------------- ---- --------- -------
Profit for the year from discontinued
operations 1,884 1,873
----------------------------------------- ---- --------- -------
(Loss)/profit for the year (599) 1,509
----------------------------------------- ---- --------- -------
Total comprehensive (loss)/ profit
for the year attributable to equity
holders (599) 1,509
----------------------------------------- ---- --------- -------
Other comprehensive income
Exchange differences on translation
of foreign operations 406 -
----------------------------------------- ---- --------- -------
406 -
----------------------------------------- ---- --------- -------
Total comprehensive (loss)/ income (193) 1,509
----------------------------------------- ---- --------- -------
Basic (loss)/earnings/ per share
----------------------------------------- ---- --------- -------
Continuing operations 7 (11.72p) (1.86p)
----------------------------------------- ---- --------- -------
Discontinued operations 7 8.89p 9.55p
----------------------------------------- ---- --------- -------
Total (2.83p) 7.69p
----------------------------------------- ---- --------- -------
Diluted (loss)/earnings per share
----------------------------------------- ---- --------- -------
Continuing operations 7 (11.72p) (1.86p)
----------------------------------------- ---- --------- -------
Discontinued operations 7 8.89p 9.55p
----------------------------------------- ---- --------- -------
Total (2.83p) 7.69p
----------------------------------------- ---- --------- -------
* Profit for the year from continuing operations before net finance costs, tax, depreciation, amortisation, integration and transactional items, impairment charges and share based payment charge.
Consolidated balance sheet
Note Unaudited Audited
2019 2018
------ ----------
GBP'000 GBP'000
------------------------------------- ------ ---------- ---------
ASSETS
------------------------------------- ------ ---------- ---------
Non-current assets
------------------------------------- ------ ---------- ---------
Property, plant and equipment 787 1,614
--------------------------------------------- ---------- ---------
Intangible assets 11,252 16,444
--------------------------------------------- ---------- ---------
Deferred tax assets 733 34
--------------------------------------------- ---------- ---------
Contract asset - accrued income 1,560 -
------------------------------------- ------ ---------- ---------
Total non-current assets 14,332 18,092
--------------------------------------------- ---------- ---------
Current assets
------------------------------------- ------ ---------- ---------
Inventories 364 224
--------------------------------------------- ---------- ---------
Contract asset - accrued income 698 6,704
--------------------------------------------- ---------- ---------
Trade and other receivables 2,023 5,848
--------------------------------------------- ---------- ---------
Other financial assets at amortised -
cost 1,557
------------------------------------- ------ ---------- ---------
Prepayments 109 1,053
--------------------------------------------- ---------- ---------
Cash and cash equivalents 8,053 4,423
--------------------------------------------- ---------- ---------
Total current assets 12,804 18,252
--------------------------------------------- ---------- ---------
Total assets 27,136 36,344
--------------------------------------------- ---------- ---------
LIABILITIES
------------------------------------- ------ ---------- ---------
Non-current liabilities
------------------------------------- ------ ---------- ---------
Borrowings 402 1,588
--------------------------------------------- ---------- ---------
Long term provisions 5 141
--------------------------------------------- ---------- ---------
Total non-current liabilities 407 1,729
--------------------------------------------- ---------- ---------
Current liabilities
------------------------------------- ------ ---------- ---------
Trade and other payables 2,541 9,864
--------------------------------------------- ---------- ---------
Deferred income 754 731
--------------------------------------------- ---------- ---------
Borrowings 24 1,618
--------------------------------------------- ---------- ---------
Total current liabilities 3,319 12,213
--------------------------------------------- ---------- ---------
Total liabilities 3,726 13,942
--------------------------------------------- ---------- ---------
NET ASSETS 23,410 22,402
--------------------------------------------- ---------- ---------
EQUITY AND LIABILITIES
------------------------------------- ------ ---------- ---------
Capital and reserves attributable
to equity shareholders
------------------------------------- ------ ---------- ---------
Share capital 2,216 2,078
--------------------------------------------- ---------- ---------
Share premium 1,058 -
------------------------------------- ------ ---------- ---------
Reverse acquisition reserve (4,236) (4,236)
--------------------------------------------- ---------- ---------
Translation reserve 406 -
------------------------------------- ------ ---------- ---------
Share option reserve 128 433
--------------------------------------------- ---------- --------- Retained earnings 23,838 24,127 --------------------------------------------- ---------- --------- Total equity 23,410 22,402 --------------------------------------------- ---------- ---------
Consolidated statement of changes in equity
Share Reverse
Share Share Merger option Translation acquisition Retained
capital premium Reserve reserve reserve reserve earnings Total
------------ ----------- ------------ ------------ ----------- -----------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Audited
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
At 1 February
2017 3,687 32,589 1,911 261 - (4,236) (19,731) 14,481
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Profit for the
year - - - - - - 1,509 1,509
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Total
comprehensive
profit for
the year - - - - - - 1,509 1,509
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Proceeds from
shares issued 433 6,067 - - - - - 6,500
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Share issue
costs - (260) - - - - - (260)
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Capital
reduction (2,042) (38,396) (1,911) - - - 42,349 -
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Employee share
schemes -
value of
employee
services - - - 172 - - - 172
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
At 31 January
2018 2,078 - - 433 - (4,236) 24,127 22,402
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Unaudited
Loss for the
year - - - - - - (599) (599)
Other
comprehensive
income for
the year - - - - 406 - - 406
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Total
comprehensive
income/(loss)
for the year - - - - 406 - (599) (193)
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Issue of
ordinary
shares as
consideration
for a
business
combination 138 1,058 - - - - - 1,196
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Lapsed share
options - - - (310) - - 310 -
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Share-based
payment
expense
- continuing
operations - - - (38) - - - (38)
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Share-based
payment
expense
-
discontinued
operations - - - 43 - - - 43
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
At 31 January
2019 2,216 1,058 - 128 406 (4,236) 23,838 23,410
-------------- ------------ ------------ ----------- ------------ ------------ ----------- ----------- -------
Consolidated statement of cash flows
Note Unaudited Audited
2019 2018
----- ----------
GBP'000 GBP'000
-------------------------------------------- ----- ---------- --------
Cash from operating activities
-------------------------------------------- ----- ---------- --------
Cash generated from operations 4 (3,469) (2,315)
-------------------------------------------- ----- ---------- --------
Interest received 51 4
-------------------------------------------- ----- ---------- --------
Interest paid (123) (120)
-------------------------------------------- ----- ---------- --------
Income taxes paid - (54)
-------------------------------------------- ----- ---------- --------
Net cash outflow from operating activities (3,541) (2,485)
-------------------------------------------- ----- ---------- --------
Cash flows from investing activities
-------------------------------------------- ----- ---------- --------
Payments for the acquisition of subsidiary
(net of cash acquired) 5 (3,965) (1,249)
-------------------------------------------- ----- ---------- --------
Payments for property, plant and equipment (245) (395)
-------------------------------------------- ----- ---------- --------
Payment of software development costs (1,872) (1,408)
-------------------------------------------- ----- ---------- --------
Proceeds from sale of Systems Integration
and Managed Services divisions (net
of cash disposed) 6 15,970 -
-------------------------------------------- ----- ---------- --------
Proceeds from sale of property, plant
and equipment 63 -
-------------------------------------------- ----- ---------- --------
Net cash from investing activities 9,951 (3,052)
-------------------------------------------- ----- ---------- --------
Cash flows from financing activities
-------------------------------------------- ----- ---------- --------
Proceeds from issues of share capital
(net of issue costs) - 6,240
-------------------------------------------- ----- ---------- --------
Proceed from borrowing - 1,150
-------------------------------------------- ----- ---------- --------
Repayment of borrowings (1,800) (1,605)
-------------------------------------------- ----- ---------- --------
Net cashflow from financing activities (1,800) 5,785
-------------------------------------------- ----- ---------- --------
Net change in cash and cash equivalents 4,610 248
-------------------------------------------- ----- ---------- --------
Cash and cash equivalents the beginning
of the financial year 3,443 3,195
-------------------------------------------- ----- ---------- --------
Cash and cash equivalents at end of
year 8,053 3,443
-------------------------------------------- ----- ---------- --------
Cash and cash equivalents comprise cash at bank and other short-term highly liquid investments with maturity of three months or less, as adjusted for any bank overdrafts.
Notes to the financial statements
1. General information
SmartSpace Software plc is a company incorporated in England and Wales under the Companies Act 2006 and listed on the AIM market. The nature of the Group's operations and its principal activities are set out in the strategic report.
The financial information, which is unaudited, for the year ended 31 January 2019 does not constitute the statutory accounts of the Group for the relevant period within the meaning of section 434 of the Companies Act 2006. Such statutory accounts will be completed in due course and delivered to the Registrar of Companies. The annual report and accounts will be made available on the Company's website in due course.
The financial statements are presented in pounds sterling as that is the currency of the primary economic environment in which the Group operates.
Going concern
The Group's business activities and performance, and the financial position of the Group, its cash flows and borrowing facilities, together with the factors likely to affect its future development, performance and position, are explained in the Strategic report.
After making appropriate enquiries, the Directors consider that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements.
2. Segmental reporting 2(a) Description of segments and principal activities
The Group's operating board, consisting of the Chief Executive Officer, Chief Financial Officer and Chief Operating Officer, examines the Group's performance from both a product and geographical perspective and has identified two reportable segments of its business:
-- Software - the sale and support of software in the UK and New Zealand. The operating board monitors the performance in those two regions separately.
-- Hardware and systems integration - the sale of hardware and related systems integration services in the UK.
Unless otherwise indicated the segmental information reported on the following pages does not include any amounts for discontinued operations, which are described in more detail in note 6.
The operating board primarily uses an adjusted measure of earnings before interest, tax, depreciation and amortisation (EBITDA) to assess the performance of the operating segments. However, the operating board also receives information about the segments revenues and assets on a monthly basis. Information about segment revenue is disclosed below.
2(b) Adjusted EBITDA
Adjusted EBITDA excludes discontinued operations and the effects of significant items of income and expenditure which might have an impact on the quality of earnings, such as reorganisation and transactional costs and impairments where the impairment is the result of an isolated non-recurring event. It also excludes the effects of equity-settled share payments.
Interest income and finance costs are not allocated to segments, because this type of activity is driven by the central treasury function which manages the cash position of the Group.
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
---------------------------------- ---------- --------
Software
---------------------------------- ---------- --------
UK (916) 1,684
---------------------------------- ---------- --------
New Zealand (261) -
---------------------------------- ---------- --------
Hardware and systems integration
---------------------------------- ---------- --------
UK 36 76
---------------------------------- ---------- --------
Central operating costs (1,525) (1,547)
---------------------------------- ---------- --------
Total adjusted EBITDA (2,666) 213
---------------------------------- ---------- --------
2(c) Reconciliation of adjusted EBITDA to loss before tax
The adjusted EBITDA reconciles tor profit before tax by segment as follows:
Unaudited Software Software Hardware Central
Year ended 31 Division Division and Systems operating
January UK New Integration costs Total
2019 Zealand
-------------------- -------------------- ----------------------- ---------------------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Revenue from
contracts
with customers 3,348 272 2,687 - 6,307
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Costs of sale
of goods (23) (1) (1,824) - (1,848)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Cost of
providing
services (687) (23) - - (710)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Gross profit 2,638 248 863 - 3,749
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Administrative
expenses (4,712) (573) (891) (1,725) (7,901)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Net impairment
losses
on financial
and contract
assets (30) - - - (30)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Other income - 39 - - 39
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Operating loss (2,104) (286) (28) (1,725) (4,143)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Adjusted
EBITDA (916) (261) 36 (1,525) (2,666)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Reorganisation
and
transactional
items included
within
administrative
expenses (190) - - (255) (445)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Depreciation (43) (3) (37) (10) (93)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Amortisation (637) (22) (21) - (680)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Impairment of
intangible
assets (297) - - - (297)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Share based
payment charge (21) - (6) 65 38
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Operating loss (2,104) (286) (28) (1,725) (4,143)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Net finance
cost - - (16) (54) (70)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Loss before
taxation (2,104) (286) (44) (1,779) (4,213)
--------------------------- -------------------- -------------------- ----------------------- --------------------- ---------------------
Audited Software Software Hardware Central
Year ended 31 Division Division and Systems operating
January UK New Integration costs Total
2018 Zealand
-------------------- -------------------- ----------------------- ---------------------
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Revenue from
contracts
with customers 4,069 - 2,068 - 6,137
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Costs of sale
of goods (30) - (1,344) - (1,374)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Cost of
providing
services (266) - - - (266)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Gross profit 3,773 - 724 - 4,497
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Administrative
expenses (2,569) - (702) (1,847) (5,118)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Net impairment
losses - - - - -
on financial
and contract
assets
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Other income - - - - -
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Operating
profit/(loss) 1,204 - 22 (1,847) (621)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Adjusted
EBITDA 1,684 - 76 (1,547) 213
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Reorganisation
and
transactional
items included
within
administrative
expenses (171) - - (218) (389)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Depreciation (24) - (39) (10) (73)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Amortisation (276) - (15) - (291)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Impairment of - - - - -
intangible
assets
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Share based
payment charge (9) - - (72) (81)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Operating
profit/(loss) 1,204 - 22 (1,847) (621)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Net finance
cost (17) - (11) (92) (120)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
Profit/(loss)
before
taxation 1,187 - 11 (1,939) (741)
--------------------------- -------------------- -------------------- ----------------------- --------------------- -------------------
2(d) Other profit and loss disclosures
Unaudited Depreciation Impairment
and amortisation of intangible Income tax
Year ended 31 January Assets expense
2019
----------------------------- --------------------------
GBP'000 GBP'000 GBP'000
--------------------------------- ----------------------------- -------------------------- ------------------------
Software 705 297 (720)
--------------------------------- ----------------------------- -------------------------- ------------------------
Hardware and Systems
Integration 58 - 0
--------------------------------- ----------------------------- -------------------------- ------------------------
Unallocated items 10 - (1,010)
--------------------------------- ----------------------------- -------------------------- ------------------------
Total 773 297 (1,730)
--------------------------------- ----------------------------- -------------------------- ------------------------
Audited Depreciation Impairment
and of intangible Income tax
Year ended 31 January amortisation assets expense
2018
------------------------- --------------------------
GBP'000 GBP'000 GBP'000
------------------------------------- ------------------------- -------------------------- ------------------------
Software 299 - (36)
------------------------------------- ------------------------- -------------------------- ------------------------
Hardware and Systems
Integration 54 - (3)
------------------------------------- ------------------------- -------------------------- ------------------------
Unallocated items 10 - (338)
------------------------------------- ------------------------- -------------------------- ------------------------
Total 363 - (377)
------------------------------------- ------------------------- -------------------------- ------------------------
2(e) Segment assets
Unaudited Audited
2019 2018
Additions Additions
Segment to Segment to
assets non-current assets non-current
assets* assets*
------------------------- -------------------- ----------------------- -------------------- -----------------------
GBP'000 GBP'000 GBP'000 GBP'000
------------------------- -------------------- ----------------------- -------------------- -----------------------
Software 14,890 1,863 5,781 1,294
------------------------- -------------------- ----------------------- -------------------- -----------------------
Hardware and
systems
integration 3,165 12 2,547 18
------------------------- -------------------- ----------------------- -------------------- -----------------------
Segment
assets 18,055 1,875 8,328 1,312
------------------------- -------------------- ----------------------- -------------------- -----------------------
Assets
relating to
discontinued
operations - 219 27,614 438
------------------------- -------------------- ----------------------- -------------------- -----------------------
Unallocated
assets 9,081 19 402 52
------------------------- -------------------- ----------------------- -------------------- -----------------------
Total assets 27,136 2,113 36,344 1,802
------------------------- -------------------- ----------------------- -------------------- -----------------------
*Other than financial assets and deferred tax assets
For the purpose of monitoring segment performance and allocating resource between segments the Group's Chief Executive monitors the tangible, intangible and financial assets attributable to each segment. All assets are allocated to reportable segments with the exception of cash held by the parent company, other financial assets (except for trade and other receivables) and tax assets.
The total of non-current assets other than deferred tax assets broken down by location of assets is shown as follows:
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
-------------- ---------- --------
UK 7,693 18,058
-------------- ---------- --------
New Zealand 5,906 -
-------------- ---------- --------
Total assets 13,599 18,058
-------------- ---------- --------
2(f) Segment liabilities
Segment liabilities are measured in the same way as in the financial statements. These liabilities are allocated based on the operations of the segment.
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
---------------------------------- ---------- --------
Software 1,704 3,037
---------------------------------- ---------- --------
Hardware and systems integration 1,635 1,099
---------------------------------- ---------- --------
Segment liabilities 3,339 4,136
---------------------------------- ---------- --------
Discontinued operations - 7,735
---------------------------------- ---------- --------
Unallocated: 387 2,071
---------------------------------- ---------- --------
Total liabilities 3,726 13,942
---------------------------------- ---------- --------
3. Revenue from contracts with customers
3(a) Disaggregation of revenue from contracts with customers
The Group derives revenue from the transfer of goods and services over time and at a point in time in the following major product lines and geographical regions
Hardware
and systems
Unaudited Software integration
Year ended 31 January
2019 UK New Zealand UK Total
------------------------------- -------- ------------ ------------- --------
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- -------- ------------ ------------- --------
Segment revenue 3,348 272 2,687 6,307
------------------------------- -------- ------------ ------------- --------
Timing of revenue recognition
------------------------------- -------- ------------ ------------- --------
At a point in time 2,318 40 2,687 5,045
------------------------------- -------- ------------ ------------- --------
Over time 1,030 232 - 1,262
------------------------------- -------- ------------ ------------- --------
3,348 272 2,687 6,307
------------------------------- -------- ------------ ------------- --------
Hardware
and systems
Audited Software integration
Year ended 31 January
2018 UK New Zealand UK Total
------------------------------- -------- ------------ ------------- --------
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- -------- ------------ ------------- --------
Segment revenue 4,069 - 2,068 6,137
------------------------------- -------- ------------ ------------- --------
Timing of revenue recognition
------------------------------- -------- ------------ ------------- --------
At a point in time 3,960 - 1,974 5,934
------------------------------- -------- ------------ ------------- --------
Over time 109 - 94 203
------------------------------- -------- ------------ ------------- --------
4,069 - 2,068 6,137
------------------------------- -------- ------------ ------------- --------
Revenues from external customers come from the sale of software as a service, the sale of software licences, the sale of professional services and the sale of hardware and systems integration. The revenue from the sale of software as a service and software licences relates to the Group's intellectual property, SwipedOn and SmartSpace.
3(b) Accounting policies
The Group has a number of different types of contractual arrangements and consequently applies a variety of methods of revenue recognition, based on the principles set out in IFRS 15 Revenue from Contracts with Customers. The revenue and profit in any period are based on the delivery of performance obligations and an assessment of when control is transferred to the customer.
In determining the amount of revenue and profits to record and related balance sheet items (such as trade receivables, accrued income and deferred income) to recognise in the period, management is required to form a number of key judgements and assumptions.
Revenue is recognised when the performance obligation in a contract has been performed (so 'point in time' recognition) or over time as the performance obligation is transferred to the customer.
For contracts with multiple components to be delivered such as software licences, software support and professional services, management applies judgement to consider whether these promised goods and services are:
-- Distinct - to be accounted for as separate performance obligations; or
-- not distinct - to be combined with other goods or services until a bundle is created that is distinct; or
-- part of a series of distinct goods and services that are substantially the same and have the same pattern of transfer to the customer.
The transaction price, being the amount to which the Group expects to be entitled and has rights to under the contract is allocated to the identified performance obligations.
For each performance obligation, the Group determines if revenue will be recognised over time or at a point in time. Where the Group recognises revenue over time for long-term contracts, this is in general due to the Group performing and the customer simultaneously receiving and consuming the benefits provided over the life of the contract. For each performance obligation to be recognised over time, the Group applies a revenue recognition method that faithfully depicts the Group's performance in transferring control of the goods or services to the customer. This decision requires assessment of the real nature of the goods or services that the Group has promised to transfer to the customer. The Group applies the relevant output or input method consistently to similar performance obligations in other contracts.
If performance obligations in a contract do not meet the over time criteria, the Group recognises revenue at a point in time (see below for further details).
The Group disaggregates revenue from contracts with customers by contract type, as management believe this best depicts how the nature, amount, timing and uncertainty of the Group's revenue and cash flows are affected by economic factors. Categories are: 'long-term contractual - greater than two years'; and 'short-term contractual - less than two years'. Years based from service commencement date.
Sale of software as a service
The Group offers its software as a service hosted in the cloud. Under terms of the contract with the customer, they receive the right to access the software for an agreed period of time. A contract liability for the provision of the software as a service is recognised at the time of sale. The management consider that revenue is recognised over time as the service is delivered until the point that the agreement expires.
Revenue invoiced at the end of the reporting period which relates to future periods is classified as deferred income on the balance sheet.
The software comprises a number of different modules which can be sold as a bundle at the outset or separately if a customer chooses to take a subscription at a later date. Additional modules will continue to be developed and offered as part of the initial product offering or sold separately to existing customers who have not subscribed to that module.
Sale of software licences
The Group sells software licences which allow customers to use the software in their own environment which results in a transfer of control to the customer at a point in time usually when the software has been installed in the customer's environment and the customer has signed an acceptance to say delivery of the software has taken place.
Revenue is recognised in full at the point of delivery to the customer as the risk and rewards of the licences have transferred at that point to the buyer and the Group does not retain managerial involvement or effective control over the software or the licences.
Sale of professional services
The Group sells professional services comprising project management, implementation, configuration, mapping and support services. These services can be purchased in advance and used by customers when required and revenue is recognised at a point in time when the service has been provided.
The Group may also sell these services as part of a larger project. In these circumstances revenue is measured and recognised by reference to the stage of completion of the project at the end of the reporting period.
Hardware and systems integration
The Group sells hardware through its Hardware and Systems Integration division or as part of a contract for software through its Software division. Revenue is recognised at the point when the performance obligation is fulfilled, usually when the hardware is delivered to the customer. Where installation services are sold alongside the hardware, revenue from those installation services is recognised when those services are delivered.
Deferred and accrued income
The Group's customer contracts include a diverse range of payment schedules dependent upon the nature and type of goods and services being provided. In the case of software as a service contracts or software support agreements customers may pay in advance for a service to be delivered over time. Other customer contracts may include progress payments for regular monthly quarterly or annual payments where revenue is recognised at a point of time.
Where payments made are greater than the revenue recognised at the period end date, the Group recognises a deferred income contract liability for this difference. Where payments made are less than the revenue recognised at the period end date, the Group recognises an accrued income contract asset for this difference.
At each reporting date, the Group assesses whether there is any indication that accrued income assets may be impaired by considering whether the revenue remains highly probable that no revenue reversal will occur. Where an indicator of impairment exists, the Group makes a formal estimate of the asset's recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
3(c) Critical judgement in recognising revenue
The Group has recognised revenue amounting to GBP899,000 in respect of a software licence which was for a fixed period of time and constituted a legal right to use the software. The software is initially hosted on a private cloud environment provided by the Group with the express permission for the customer to host the software through their own hosting platform without additional contractual penalties or obstructions. As the customer could host the software on its own infrastructure without significant cost management made the judgement that the provision of the licence was distinct from the other performance obligations. It was further concluded that the customer was not entitled to receive any future enhancements or developments in the product and therefore the licence was a right to use the Groups intellectual property rather than a right to access and therefore the licence revenue should be recognised at a point in time.
4. Cash generated from operations
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
------------------------------------------------ ---------- --------
Loss before income tax from continuing
operations (4,213) (741)
------------------------------------------------ ---------- --------
Adjustments for:
------------------------------------------------ ---------- --------
Depreciation and amortisation 773 363
------------------------------------------------ ---------- --------
Impairment of intangible assets 297 -
------------------------------------------------ ---------- --------
Non-cash employee benefit expense -
share-based payments (38) 81
------------------------------------------------ ---------- --------
Net gain on sale of on-current assets (14) -
------------------------------------------------ ---------- --------
Finance costs - net 70 120
------------------------------------------------ ---------- --------
Gain on derecognition of contingent (50)
consideration payable -
------------------------------------------------ ---------- --------
Net exchange differences 94 -
------------------------------------------------ ---------- --------
Change in operating assets and liabilities
of continuing operations, net of effects
from purchase of Swiped On Limited
------------------------------------------------ ---------- --------
Movement in trade and other receivables (950) (386)
------------------------------------------------ ---------- --------
Movement in accrued income (714) (1,027)
------------------------------------------------ ---------- --------
Movement in inventories (291) 78
------------------------------------------------ ---------- --------
Movement in prepayments 57 147
------------------------------------------------ ---------- --------
Movement in trade creditors 987 (273)
------------------------------------------------ ---------- --------
Movement in deferred income 443 (175)
------------------------------------------------ ---------- --------
Movement in other provisions (50) (1)
------------------------------------------------ ---------- --------
Cash generated from continuing operations (3,599) (1,814)
------------------------------------------------ ---------- --------
Loss before income tax from discontinued
operations 2,039 2,189
------------------------------------------------ ---------- --------
Adjustments for:
------------------------------------------------ ---------- --------
Depreciation and amortisation 283 664
------------------------------------------------ ---------- --------
Non-cash employee benefit expense -
share-based payments 43 91
------------------------------------------------ ---------- --------
Profit on sale of discontinued operations (1,542) -
------------------------------------------------ ---------- --------
Finance costs - net 2 (4)
------------------------------------------------ ---------- --------
Change in operating assets and liabilities
of discontinued operations net of effects
from the disposal of the Systems Integration
and Managed Services divisions
------------------------------------------------ ---------- --------
Movement in trade and other receivables (1,410) (123)
------------------------------------------------ ---------- --------
Movement in accrued income (4,808) (3,503)
------------------------------------------------ ---------- --------
Movement in inventories (12) 14
------------------------------------------------ ---------- --------
Movement in prepayments 279 (2)
------------------------------------------------ ---------- --------
Movement in trade creditors 4,780 190 ------------------------------------------------ ---------- -------- Movement in deferred income 469 10 ------------------------------------------------ ---------- -------- Movement in other provisions 7 (27) ------------------------------------------------ ---------- -------- Cash generated from discontinued operations 130 (501) ------------------------------------------------ ---------- -------- Cash generated from operations (3,469) (2,315) ------------------------------------------------ ---------- -------- 5. Business combination
On 16 October 2018 the Group acquired 100% of the issued share capital of SwipedOn Limited. SwipedOn Limited, based in New Zealand, is a fast growing SaaS business offering a visitor management solution to customers around the world on a monthly subscription. Capable of linking multiple locations with one seamless company overview, the software is able to instantly notify employees of visitor arrivals via email and/or SMS, whilst also custom printing visitor ID badges. SwipedOn is also able to be utilised to monitor employees located in the office.
The acquisition of SwipedOn is in line with the Group's strategy of growing its SaaS revenues, extending its service offering and widening its geographical footprint.
Details of the purchase consideration, the net assets acquired and goodwill are as follows:
Unaudited
GBP'000
--------------------------------------------- ----------
Purchase consideration (refer to (b) below)
--------------------------------------------- ----------
Cash paid 4,277
--------------------------------------------- ----------
Ordinary shares issued 1,196
--------------------------------------------- ----------
Total purchase consideration 5,473
--------------------------------------------- ----------
The fair value of the 1,372,618 ordinary shares issued as part of the consideration paid for SwipedOn Limited (GBP1,196,000) was based on the average published share price of the ordinary shares as quoted on AIM for the five days immediately preceding the acquisition of GBP0.871.
The assets and liabilities assumed recognised as a result of the acquisition are set out in the table below:
Unaudited
Fair value
GBP'000
---------------------------------------- ------------
Intangible assets 716
---------------------------------------- ------------
Property, plant and equipment 12
---------------------------------------- ------------
Trade and other receivables 54
---------------------------------------- ------------
Cash and cash equivalents 312
---------------------------------------- ------------
Trade and other payables (145)
---------------------------------------- ------------
Contract liabilities - deferred income (247)
---------------------------------------- ------------
Deferred tax liability (89)
---------------------------------------- ------------
Net identifiable assets acquired 613
---------------------------------------- ------------
Add: Goodwill 4,860
---------------------------------------- ------------
Net assets acquired 5,473
---------------------------------------- ------------
The goodwill of GBP4,860,000 arising from the acquisition consists of the expertise and experience of the SwipedOn assembled workforce, presence in suitable geographical locations and the availability of a distribution channel through which the Group expects to generate further synergies. None of the goodwill is expected to be deductible for income tax purposes.
The fair value of the financial assets including trade receivables with a fair value and gross contractual value of GBP58,000. The best estimate at acquisition date of the contractual cash flows to be collected was GBP54,000.
The intangible assets identified at acquisition comprise intellectual property with a fair value at acquisition of GBP425,000 and brand with a fair value at acquisition of GBP291,000.
We have adopted the cost basis for valuing the intellectual property intangible asset which involves estimating the cost of reproducing the asset. We have identified the total historic costs of developing the asset and then discounted the costs incurred up to 2016 by 75% to reflect obsolescence following a major upgrade and applied a much lower discount rate of 5% to the costs incurred since 2016.
In valuing the brand asset we have used the relief-from-royalty method which considers the discounted estimated royalty payments that are expected to be avoided by owning the brand. We have used a royalty rate of 1% which is a prudent estimate towards the lower end of a range of published royalty rates. The discount rate applied is 9.77% which is very close to the Group's weighted average cost of capital and represents what the management consider to a be fair return on the intangible assets.
The acquired business contributed revenues of GBP272,000 and a net loss after tax of GBP265,000 to the Group for the period from 15 October 2018 to 31 January 2019.
If the acquisition of SwipedOn Limited had been completed on the first day of the financial year the Group's revenue would have been GBP6,817,000 and the Group's loss after tax would have been GBP995,000 for the year:
These amounts have been calculated using the subsidiary's results and adjusting them for:
-- Differences in the accounting policies between the Group and the subsidiary; and
-- The additional depreciation and amortisation that would have been charged, assuming that the fair value adjustments to property, plant and equipment, and intangible assets had applied from 1 February 2018, together with the consequential tax effects.
6. Discontinued operations 6(a) Financial performance and cash flow information
On 18 June 2018 the Group completed the disposal of 100% of the share capital of Communica Holdings Limited and its 100% subsidiary Redstone Converged Solutions Limited, and Commensus Limited ("the disposal group") and this is reported in the current period as a discontinued operation. Financial information relating to the discontinued operation for the period to the date of disposal is set out below:
6(b) Financial performance and cash flow information
The financial performance and cash flow information are presented from the period from 1 February 2018 to 15 June 2018 (2018 column) and the year ended 31 January 2018:
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
----------------------------------------------- ---------- ---------
Revenue 25,495 41,437
----------------------------------------------- ---------- ---------
Expenses (24,997) (39,248)
----------------------------------------------- ---------- ---------
Profit before loan waiver 498 2,189
----------------------------------------------- ---------- ---------
Waiver of intercompany loan to parent company (1,403) -
----------------------------------------------- ---------- ---------
Profit before tax (905) 2,189
----------------------------------------------- ---------- ---------
Income tax expense (156) (316)
----------------------------------------------- ---------- ---------
Profit after income tax of discontinued
operations (1,061) 1,873
----------------------------------------------- ---------- ---------
Gain on disposal of subsidiary after income 2,945
tax (see note 6 (c)) -
----------------------------------------------- ---------- ---------
Net profit attributable to discontinued
operations 1,884 1,873
----------------------------------------------- ---------- ---------
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
-------------------------------------- ---------- --------
Net cash inflow from operating
activities 130 (501)
--------------------------------------- ---------- --------
Net cash inflow from investing
activities (2019 includes an inflow
of GBP15,970,000 from the sale
of the division) 15,751 (438)
--------------------------------------- ---------- --------
Net cash outflow from financing
activities - -
-------------------------------------- ---------- --------
Net increase I cash generated by
the subsidiaries 15,881 (939)
--------------------------------------- ---------- --------
6(c) Details of the sale of subsidiary
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
-------------------------------------- ---------- --------
Consideration received or receivable
-------------------------------------- ---------- --------
Cash 20,600 -
-------------------------------------- ---------- --------
Contingent consideration 1,000 -
-------------------------------------- ---------- --------
Total disposal consideration 21,600 -
-------------------------------------- ---------- --------
Carrying amount of net assets sold 19,357
pre loan waiver -
-------------------------------------- ---------- --------
Gain on sale before costs 2,243 -
Costs incurred on disposal (701) -
-------------------------------------- ---------- --------
Net gain on disposal 1,542
--------------------------------------- ---------- --------
Waiver of intercompany balance 1,403 -
--------------------------------------- ---------- --------
Total gain on disposal 2,945 -
--------------------------------------- ---------- --------
As part of the consideration a sum of GBP2.0 million was retained by the purchaser for working capital purposes and relates to a contract asset in respect of a customer contract which was not due to be recovered until after the completion of the sale. As the value of contract asset reduces over time the contingent consideration is repayable to the Group. In the event that the value of the contract asset exceeds the contingent consideration the Group may be required to provide additional funding to cover the excess of the contract asset over the value of the contingent consideration. At 31 January 2019 no additional working capital has been provided and GBP1,000,000 has been paid to the Group. The remaining GBP1 million has been included in other financial assets at amortised cost and is expected to be fully recovered.
The carrying amount of assets and liabilities as at the date of sale (18 June 2018) were:
Unaudited
At
18 June
2018
GBP'000
------------------------------------------------------------- ----------
Intangible assets 11,857
------------------------------------------------------------- ----------
Property, plant and equipment 801
------------------------------------------------------------- ----------
Inventories 141
------------------------------------------------------------- ----------
Trade and other receivables (including GBP1.4m intercompany
loan) 17,763
------------------------------------------------------------- ----------
Cash and cash equivalents 3,929
------------------------------------------------------------- ----------
Total assets 34,491
------------------------------------------------------------- ----------
Trade and other payables 15,021
------------------------------------------------------------- ----------
Deferred tax liability 113
------------------------------------------------------------- ----------
Total liabilities 15,134
------------------------------------------------------------- ----------
Net assets 19,357
------------------------------------------------------------- ----------
7. Earnings per share
7(a) Basic (loss)/earnings per share
Unaudited Audited
2019 2018
----------
Pence Pence
---------------------------------------------------- ---------- --------
From continuing operations attributable
to the ordinary equity holders of the Company (11.72p) (1.86p)
---------------------------------------------------- ---------- --------
From discontinued operations 8.89p 9.55p
---------------------------------------------------- ---------- --------
Total basic (loss)/earnings per share attributable
to the ordinary equity holders of the Company (2.83p) 7.69p
---------------------------------------------------- ---------- --------
7(b) Diluted (loss)/earnings per share
Unaudited Audited
2019 2018
----------
Pence Pence
------------------------------------------------ ---------- --------
From continuing operations attributable
to the ordinary equity holders of the Company (11.72p) (1.86p)
------------------------------------------------ ---------- --------
From discontinued operations 8.89p 9.55p
------------------------------------------------ ---------- --------
Total diluted l(loss)/earnings per share
attributable to the ordinary equity holders
of the Company (2.83p) 7.69p
------------------------------------------------ ---------- --------
7(c) Reconciliation of (loss)/earnings used in calculating earnings per share
(Loss)/earnings per share data is based on the Group (loss)/profit for the year and the weighted average number of ordinary shares in issue.
Unaudited Audited
2019 2018
----------
GBP'000 GBP'000
---------------------------------------------------- ---------- --------
Basic earnings per share
---------------------------------------------------- ---------- --------
(Loss)/profit attributable to the ordinary
equity holders of the Company used in calculating
basic earnings per share
---------------------------------------------------- ---------- --------
From continuing operations (2,483) (364)
---------------------------------------------------- ---------- --------
From discontinued operations 1,884 1,873
---------------------------------------------------- ---------- --------
(599) 1,509
---------------------------------------------------- ---------- --------
Diluted earnings per shares
---------------------------------------------------- ---------- --------
(Loss)/profit attributable to the ordinary
equity holders of the Company used in calculating
basic earnings per share
---------------------------------------------------- ---------- --------
From continuing operations (2,483) (364)
---------------------------------------------------- ---------- --------
From discontinued operations 1,884 1,873
---------------------------------------------------- ---------- --------
(Loss)/profit attributable to the ordinary
equity holders of the Company used in calculating
diluted earnings per share (599) 1,509
---------------------------------------------------- ---------- --------
7(d) Weighted average number of shares used as the denominator
Unaudited Audited
2019 2018
---------------------------
Number Number
------------------------------------------------- --------------------------- -----------
Weighted average number of shares used as
the denominator in calculating basic earnings
per share 21,190,940 19,621,325
------------------------------------------------- --------------------------- -----------
Adjustments for calculation of diluted earnings
per share
------------------------------------------------- --------------------------- -----------
Options - -
------------------------------------------------- --------------------------- -----------
Weighted average number of shares and potential
ordinary shares used as the denominator
in calculating diluted earnings per share 21,190,940 19,621,325
------------------------------------------------- --------------------------- -----------
7(d) Information concerning the classification of securities
Options
Options granted to employees under the Group's share option schemes are considered to be potential ordinary shares. They have been included in the diluted earnings per share to the extent which they are dilutive. The options have not been included in the determination of basic earnings per share.
Options which are antidilutive are not included in the calculation of diluted earnings per share for the year ended 31 January 2019. These options could potentially be dilutive in the future.
7(e) Alternative measure of earnings per share
Unaudited Audited
2019 2018
---------------
GBP'000 GBP'000
------------------------------------------------- --------------- -----------
Loss for the year (2,483) (364)
------------------------------------------------- --------------- -----------
Adjustment to basic (loss)/earnings:
------------------------------------------------- --------------- -----------
Integration and transactional costs 445 389
------------------------------------------------- --------------- -----------
Tax credit on integration and transactional
costs (85) (75)
------------------------------------------------- --------------- -----------
Amortisation of acquired intangibles 167 139
------------------------------------------------- --------------- -----------
Deferred tax credit on amortisation of acquired
intangibles (32) (27)
------------------------------------------------- --------------- -----------
Impairment of intangible asset 297 -
------------------------------------------------- --------------- -----------
Deferred tax credit on impairment of intangible -
asset (56)
------------------------------------------------- --------------- -----------
Share based payment charge (38) 81
------------------------------------------------- --------------- -----------
Deferred tax credit on share based payment
charge 7 (16)
------------------------------------------------- --------------- -----------
Adjusted (loss)/earnings attributable to
owners of the Company (1,778) 127
------------------------------------------------- --------------- -----------
Number of shares No. No.
------------------------------------------------- --------------- -----------
Weighted average ordinary shares in issue 21,190,940 19,621,325
------------------------------------------------- --------------- -----------
Weighted average potential diluted shares
in issue 21,190,940 19,621,325
------------------------------------------------- --------------- -----------
Adjusted (loss)/earnings per share
------------------------------------------------- --------------- -----------
Basic (loss)/earnings per share (8.39p) 0.65p
------------------------------------------------- --------------- -----------
Diluted (loss)/earnings per share (8.39p) 0.65p
------------------------------------------------- --------------- -----------
8. Events occurring after the end of the reporting period
There are no material events occurring after the end of the reporting period.
9. Annual General Meeting
Further details in relation to the Annual General Meeting will be provided in due course.
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
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