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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Sysgroup Plc | LSE:SYS | London | Ordinary Share | GB00BYT18182 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 19.50 | 19.00 | 20.00 | 19.50 | 19.50 | 19.50 | 0.00 | 08:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Computer Related Svcs, Nec | 22.71M | -5.9M | -0.0709 | -2.75 | 16.23M |
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RNS Number : 0922D
System C Healthcare plc
10 September 2008
System C Healthcare plc
Preliminary Results for Year Ended 31 May 2008
System C Healthcare plc ("System C"), a leading supplier of healthcare products and services, announces its results for the year ended
31 May 2008.
Financial Highlights of the Year
* Revenues increased by 34% to �18.1m (2007: �13.5m), including 27% (�3.7m) organic growth
* Product revenues increased by 66% to �5.8m (2007: �3.5m)
* Services revenues increased by 23% to �12.3m (2007: �10m)
* Gross margin of 55% at �10.1m, an increase of �3.7m on the prior year (2007: �6.4m)
* Profit from operations up 292% at �2.4m (2007: �0.6m)
* Profit before taxation of �3.3m up from �1.3m in the year ended 31st May 2007
* EPS up 135% at 2.56 pence (2007: 1.09p)
* Strong cash generation with a net cash position as at 31 May 2008 of �12.4m (2007: �10m)
* Outstanding debt repaid during the year
* Proposed final dividend of 0.36p giving a full year dividend of 0.54p, a 50% increase on prior year (2007: 0.36p)
Dr Ian Denley, Chief Executive commented:
"We are delighted with the performance of the Group this year. We are in a strong financial position, have won significant new
contracts, grown our client base, completed two strategic acquisitions, and created a new general healthcare consulting business. We have
also launched our next generation Medway Sigma product range at a time when there are growing product opportunities both in the UK and
overseas."
Operational Highlights for the Year
* The Services Division continued to enhance its reputation for delivery, successfully completing nearly 200 projects in the course
of the year and for the first time achieving full national coverage. It expanded its client base, working on a wide range of complex
deployments within the National Programme for IT ("NPfIT"), as well as directly with NHS Trusts and within the independent and private
healthcare markets.
* The company delivered phase one of the Isle of Man's �7.5m Patient Administration System and Electronic Patient Record ("PAS/
EPR") on time and to budget. The modules delivered so far include Patient Administration, Emergency Care, Maternity and Business
Intelligence.
* The Products Division focused on the development of the next generation Medway Sigma product range. The bulk of the phase one
development is complete and the Emergency Care, Master Patient Index, Maternity and Business Intelligence modules are now installed and in
live use.
* Two important strategic acquisitions were completed during the year. IQ Systems Services Ltd and Care Records Ltd were acquired
for an aggregate cash consideration of �1.8m, plus up to an additional �4m dependent upon future performance. These acquisitions took the
System C Group into the independent sector healthcare market and expanded its portfolio of clinical products, technology and expertise.
* The company achieved significant success in the new NHS Additional Services Capability and Capacity ("ASCC") contract. System C
was selected as a preferred supplier under the framework agreement in all 16 categories it tendered for, including the key PAS category.
For further information please contact
System C Healthcare plc
Ian Denley, Chief Executive
Jim Horsburgh, Chairman
Andrew Coll, Finance Director Tel: 01622 691 616
Maitland
Emma Burdett
Richard Farnsworth Tel: 0207 379 5151
Collins Stewart Europe Limited
Mark Connelly
Stewart Wallace Tel: 0207 523 8350
Chairman's Statement
Introduction and highlights
2007/8 has been a very successful year for System C. The Group has increased its client base, won new contracts, completed two strategic
acquisitions and achieved significant organic growth in revenues, profitability and cash generation.
Building on its reputation as a premier healthcare IT services Group, System C has this year achieved full geographical coverage in
England and increased its services revenues by 23%. The Group now has a substantial presence across all five English National Programme
clusters.
At the same time, System C has continued to make excellent progress in product development and delivery, with Product revenues up 66% on
2007. The Group successfully deployed its MedWay Patient Administration and Electronic Patient Record System ("PAS/EPR") in the Isle of Man.
The development team also completed the process of converting most of the MedWay suite of software into Microsoft's latest .net technology,
generating new product sales opportunities in the UK and overseas.
Acquisitions
During the year we acquired two businesses, IQ Systems Services Ltd and Care Records Ltd, and successfully integrated them into the
System C Group. These strategic acquisitions brought with them new products, new clients and high calibre teams, and accelerated the Group's
expansion into the specialist clinical systems and the independent sector healthcare markets.
We see scope for further acquisitions provided they meet our strict investment criteria and promise strong returns to our shareholders.
People and the Board
We are primarily a people business. Our staff are dedicated, professional and passionate about healthcare. It is these qualities which
have enabled us to build and maintain our reputation as a first-rate delivery organisation. The Board would like to take this opportunity to
thank everyone for the commitment and hard work that made the year such a success.
"System C people have helped me resolve all kinds of complex deployment challenges in a professional and flexible manner. I can tell
you it is most refreshing".
Sue Wilson, Head of EPR at Sandwell & West Birmingham Hospitals NHS Trust.
System C is also committed to high standards of corporate governance. As an AIM-listed Group, although we are not bound by the Combined
Code on Corporate Governance, we have voluntarily adopted many of its provisions.
Dividend
The Board is pleased to recommend a final dividend of 0.36p, giving a total dividend of 0.54p for the year. This represents an increase
of 50% on 2007 and reflects the strong financial performance and cash generation of the business. If approved by the shareholders at the
Annual General Meeting on 6 November 2008, the final dividend will be paid on 10 November 2008 to those shareholders on the register on 3
October 2008.
Current Trading and Outlook
We have had a good start to the new financial year, and anticipate another good performance in 2008/9.
System C has a substantial order book for products and services for 2008/9 and beyond, and a healthy pipeline of opportunities. By
growing and diversifying both our client base and our sources of revenue we have reduced risk and expanded our opportunities for further
progress.
The Board considers that market prospects for healthcare services and products to be favourable, and is confident of achieving continued
growth.
Chief executive officer's review
System C has performed well this year and I am pleased to report that we have made progress in each area of our business.
Group revenues increased 34% to �18.1m, profit from operations increased to �2.4m (2007: �0.6m), and we closed the year with a strong
net cash balance of �12.4m (2007: �10m). A large proportion of the revenue growth (�3.7m) was organic and the cash balance was net of the
�1.8m consideration paid for acquisitions during the year.
Since the early days of the National Programme for IT when System C was focused on a small number of key customers, the Group has worked
hard to increase the breadth and diversity of its client base. We saw good progress in this respect in 2007/08 with additional product
sales, a significant move into the independent healthcare sector, and the Group securing two major new Services clients.
One of the key strengths of our business is that we combine a substantial and experienced services delivery capability with a broad,
high quality product range. Our Product and Services divisions work together to maximise the cross-sharing of knowledge about delivery,
workflow methodologies, technical skills and deployment, and we have continued to apply this combined resource to the benefit of our
clients. For example, during 2007/8 we used our MedWay product design skills in support of NPfIT projects, while our Services deployment
teams helped implement MedWay and other systems. The entire Group benefits from this synergy, and it has contributed to the creation of an
efficient and cost-effective delivery service able to handle complex and high volume projects.
Services and delivery capability
Revenue from our Services Division grew 23% to �12.3m in the year due to new business and increased demand from existing customers.
The Services Division has continued to enhance its reputation for taking on and resolving the most complex issues. The team has
delivered nearly 200 work packages in the course of the year, working in areas ranging from training to data migration. With new contract
wins in London, the Group has achieved full national coverage for the first time. The Group's experience across care settings continues to
grow. The team has worked extensively with acute hospitals, primary care trusts, GP practices, diagnostic centres, ambulance trusts and a
broad range of clinical departments.
The major services contract signed with NHS Connecting for Health ("CfH") in May 2007 continues to progress well, and CfH has recently
signed a 12 month extension. In addition, Services staff continue to work for Local Service Providers ("LSPs") and NHS Trusts across the
country supporting all aspects of National Care Record System ("NCRS") deployments.
Outside of the National Programme, the Division worked in support of the Government's Independent Sector Diagnostics Programme by
delivering a complex patient management and imaging system to 28 static and mobile sites across London. It is now working on a similar
project for PET/CT imaging ("Position Emission Tomography and Computed Tomography").The Division is also providing direct services support
to the companies acquired by the Group and, in an example of the synergies between System C and its acquisitions, is now providing
significant levels of consultancy and deployment support to the new clients brought into the Group when the companies were purchased.
Launch of Perigon Consulting
In March 2008, we launched Perigon Consulting, a new consultancy service aimed at helping healthcare organisations meet the challenges
posed by the Government's reform agenda. This service utilises the clinical and healthcare management skills and experience of our
employees, but its remit extends beyond IT to the broad operational issues associated with clinical change and service improvement.
Perigon's focus is on improving services to patients through innovative clinical practice and associated business efficiencies. Areas of
specialisation include the design and delivery of clinical assessment services, the redesign of clinical and business processes and
public/employee engagement, a key component in the delivery of clinical assessment services.
This new offering has been created by combining the expertise of Perigon Healthcare, an existing independent healthcare consulting
partnership specialising in 'future state' healthcare development, with System C's healthcare consulting service. Perigon operates as a
division of System C Healthcare and has access to all of System C's people and resources.
This initiative has already secured its first contracts and Perigon promises to develop into a significant new line of business in the
coming years.
Products
Revenues within the Products Division grew by �2.3m to �5.8m in the year, driven both by organic growth of �1.4m (40%) and by the IQ and
Care Records acquisitions which together contributed �0.9m of revenue.
During 2007/8, the Product teams focused on the deployment and support of existing healthcare products and on the development of the
next generation Medway Sigma product range.
In November 2007, our Product and Services divisions combined to deliver our own MedWay Electronic Patient Record system to Nobles and
Ramsey hospitals on the Isle of Man. This was the first phase of the Group's �7.5m 5-year contract to computerise healthcare across the
island and included PAS, Accident and Emergency, maternity, document tracking, data warehouse and reporting systems. This was an extremely
successful deployment, delivered on time and within budget in just eight months, and brought the Group significant positive publicity in the
UK market.
We continue to support our existing clients with our MedWay software suite and have made many significant improvements to the product
over the course of the year, including a new service to support the government's 18 week Referral to Treatment ("RTT") programme, enhanced
support for clinicians via the integration of the Map of Medicine online clinical knowledgebase, and the integration of clinical systems
such as electronic prescribing and maternity.
Product development
System C recognises the value of continuous development of its healthcare products and has taken advantage of the Group's strong
financial position to expand its development programme at a time when many UK healthcare systems providers have curbed their investment.
The software development teams continue to make excellent progress with the redevelopment of the healthcare software suites into
Microsoft .net technologies. The key patient management and clinical modules have now been completed on schedule and within budget, and a
number of modules including master patient index, emergency care, electronic casenote, clinical coding, clinical letters, patient tracking,
maternity, and business intelligence were installed in June 2008, three months earlier than planned. The new systems are performing well and
are popular with clinical, administrative and management users. The upgraded product is known as Medway Sigma.
The move to a Microsoft .net based system is a significant achievement with many important benefits. The development provides full
integration with Microsoft's core product set (including SQLServer, Exchange, Office Communications Server, Office, SharePoint and
PerformancePoint), and gives users all of the benefits of these products from within the Medway Sigma software. Medway Sigma also becomes
the first trust-wide product available in the UK to standardise on the new Common User Interface ("CUI") developed jointly by Microsoft and
the NHS. The look and feel of the new product set is clean and modern and adherence to Microsoft and CUI standards means that the solutions
are familiar to NHS users. This has the benefit of reducing training requirements for customers whilst enhancing functionality and
usability.
Appointed supplier under Additional Services Capacity and Capability Contract ("ASCC")
In April 2008, System C secured a major framework agreement to provide a range of IT products and services to the NHS.
The Group was successful in all of the 16 categories that it bid for, and now holds framework contracts for its PAS, maternity and A&E
systems, as well as for a wide range of clinical software. System C was also successful in its bid to provide associated consultancy
services such as deployment, data migration, training and interfacing for all of the above. Winning these contracts gives the Group a
significant advantage in the English market.
The new ASCC framework contracts are for a four year duration. They will allow NHS organisations and other NHS-funded establishments,
such as Independent Treatment Centres, a faster and easier route to procure IT systems and services from suppliers who have demonstrated
experience in the health sector. ASCC can be used to support both NPfIT related work and wider IT-related projects.
Acquisitions
Our strategy is to identify acquisition opportunities which meet our stringent investment criteria and provide System C with new clients
in related markets and/or strategic technologies for use within our Medway Sigma product range.
We acquired IQ Systems Services Ltd in July 2007 for a cash consideration of �0.9 million with further amounts payable on achievement of
specific performance criteria. This company develops and markets the IQUtopia patient management and clinical system to Independent
Treatment Centres. The acquisition has furthered System C's expansion into the private healthcare market and the synergies between IQ and
the Group has also meant that System C staff are now contracting directly with IQ clients. Our focus on strengthening IQ's business
development activities has led to considerable interest in the product range from private healthcare providers in the UK and overseas.
Care Records Ltd was acquired in January 2008 for a cash consideration of �0.9 million. Care Records is a developer of leading-edge
technology for the design and development of clinical IT systems. It has used this core technology to produce the Eclipse maternity system
and a diabetes management system, both of which have been installed in UK hospitals. Further clinical modules are currently under
development.
The Care Records clinical products are in the process of being integrated into the Medway Sigma product set and will advance the
availability of extended clinical functionality into Sigma by several years.
Key performance indicators (KPIs)
The Directors believe that the KPIs of the business are revenues, average revenue per head gross margins, operating profit margins,
earnings per share and cash generation. This information is summarised below:
Year ended 31 May 2008 2007
Revenue �18.1m �13.5m
Average revenue per head1 �101,842 �85,816
Gross margin2 55% 47%
Margin on profit from operations3 13% 4%
Basic EPS 2.56p 1.09p
Net Cash balance �12.4m �10m
Net cash generated by operating activities �4.5m �2.1m
Note 1 Average revenue per head is defined as the total revenue in the year divided by the average monthly number of employees.
Note 2 Gross margin is defined as gross profit divided by total revenue.
Note 3 Margin on profit from operations is defined as the profit from operations divided by total revenue
Additional comments on the movement in Group's KPIs are contained within the Financial Review.
The Board sets targets and monitors progress against these and other operational performance measures on a regular basis.
Our strategy
Over the last two years, we have consolidated our position as the UK's premier healthcare IT services supplier, and have developed an
excellent reputation for the delivery of complex IT solutions in both the public and the private sectors.
We are also expanding our consultancy services into general healthcare consulting, leveraging our skills and experience in clinical and
healthcare management. In parallel, we have completed a significant redevelopment of our product range that positions us well for future
patient management and clinical systems sales opportunities both in the UK and overseas.
We continue to evaluate acquisition opportunities to enhance our consulting, services and products businesses on a selective basis.
These are exciting times, with considerable opportunities for expansion, and we would like to thank our customers, our employees and our
shareholders for their continued support.
Financial Review
The System C Group has achieved a year of significant growth with revenue up by 34% to �18.1m (2007:�13.5m). PBT rose by 146% to �3.3m
(2007:�1.3m) and earnings per share grew by 1.47p to 2.56p per share (2007:1.09p).
Revenue
Our Group delivered total revenues of �18.1m, an increase of �4.6m. This was driven by organic growth within both our Services and
Product divisions, as well as the acquisition of IQ Systems and Care Records in the year, as illustrated in the table below:
Year ended 31 May 2008 2007
Audit Audit
ed ed
�m �m
System C Products (excluding acquisitions) 4.9 3.5
System C Services 12.3 10.0
System C Healthcare Sub-Total 17.2 13.5
IQ Systems Services and Care Records (acquisitions) 0.9 -
Total Revenue 18.1 13.5
Gross Profit 10.1 6.4
Profit from operations 2.4 0.6
Net financial income 0.9 0.7
Profit before Tax 3.3 1.3
Tax (1.1) (0.4)
Profit after Tax 2.2 0.9
Basic EPS 2.56p 1.09p
We have continued to focus on expanding our client base. We have taken on new public sector clients, increased our geographic coverage
to include London, delivered the first phase of our PAS/EPR system to the Isle of Man and, through the acquisition of IQ Systems, we
secured new opportunities with Independent Sector Treatment Centre providers such as Care UK and Circle Healthcare.
Gross margin
Gross margin increased to 55% from 47% in 2007, reflecting growth of higher margin product revenues within System C, as well as the
impact of the acquisition of IQ Systems.
Profit from operations
Profit from operations was �2.4m, a significant increase from prior year (2007:�0.6m). The increase in revenues and gross margins,
combined with the continued control of operating costs, has led to an increase in the margin on profit from operations to 13% from 4% in the
prior year.
The growth in overall administrative expenses includes �0.2m in respect of amortisation of intangibles, as well as the impact of the
acquisition of Care Records and IQ Systems. The Group continues to focus on ensuring that the core cost base is maintained at an appropriate
level.
Net financial income
Interest receivable on customer contracts relates mainly to our long term contracts, where an element of the charge includes a recovery
for finance costs. Offsetting this income is the interest on financing loans taken out to fund the contract assets. The financing loans
amounting to �0.9m at the start of the year were fully repaid during the year. Interest receivable also includes interest generated on our
cash balances.
Taxation
The taxation charge was �1.1m, equating to 32% of PBT. During the year the company utilised brought forward tax losses, and as a result
the deferred tax assets available to offset against future Corporation Tax liabilities decreased to �0.02m at the year end (2007: �0.9m)
Earnings per share
Basic earnings per share increased to 2.56p (2007:1.09p). The weighted average number of shares during the period used for the EPS
calculation was 87,243,442 (2007: 87,148,360).
Dividends
An interim dividend of 0.18p (2007: 0.12p) was declared and paid during the year. The Board proposes a final dividend of 0.36p (2007
0.24p) per share bringing the total for the year to 0.54p per share (2007: 0.36p).
Cash and treasury
2008 2007
�m �m
Net cash generated by operating activities 4.5 2.1
Net financial income 0.9 0.7
Acquisition of subsidiaries (1.8) -
Capital expenditure (0.8) (0.5)
Net cash inflow before financing activities 2.8 2.3
Financing (0.9) (1.3)
Net cash inflow 1.9 1.0
The Group continued to generate strong cash flow with net cash generated from operating activities of �4.5m (2007:�2.1m).
On 2 July 2007 the Group acquired 100% of the share capital of IQ Systems Services Ltd and on 28 January 2008 the Group acquired 100% of
the share capital of Care Records Ltd. The total cash outlay in the year for these acquisitions was �1.8m (including initial acquisition
costs). Further consideration may be payable depending on the achievement of demanding performance criteria.
Group Income Statement
Year Ended Year Ended
31 May 31 May
2008 2007
Note �'000 �'000
Revenue 2 18,128 13,473
Cost of sales (8,075) (7,061)
Gross pro*t 10,053 6,412
Selling and marketing costs (379) (487)
Research and development costs (1,105) (1,045)
Administration and general overheads (6,126) (4,257)
Pro*t from operations 2,443 623
Financial income 891 803
Financial expense (48) (92)
Pro*t before taxation 4 3,286 1,334
Taxation 5 (1,052) (384)
Pro*t for the financial year 2,234 950
Earnings per ordinary share
- Basic 6 2.56 1.09
- Diluted 6 2.54 1.08
The results above relate entirely to continuing operations.
Group Balance Sheet
At 31 May At 31 May
2008 2007
�'000 �'000
ASSETS
Non-current assets
Goodwill 1,884 -
Property, plant and equipment 415 673
Intangible assets 2,250 351
Deferred tax assets 23 927
Trade and other receivables 428 774
5,000 2,725
Current assets
Trade and other receivables 6,489 6,492
Cash and cash equivalents 12,427 10,574
18,916 17,066
TOTAL ASSETS 23,916 19,791
LIABILITIES
Current liabilities
Trade and other payables 4,010 3,154
Deferred consideration 680
Current tax liability 162 92
Borrowings 528
4,852 3,774
Non-current liabilities
Deferred consideration 670 -
Deferred tax liability 414 -
Provisions and other liabilities 104 102
1,188 102
TOTAL LIABILITIES 6,040 3,876
NET ASSETS 17,876 15,915
SHAREHOLDERS' EQUITY
Share capital 895 895
Share premium account 9,766 9,757
Capital redemption reserve 3,127 3,127
Own shares held in trust (1,235) (1,235)
Retained earnings 5,323 3,371
TOTAL EQUITY 17,876 15,915
Group Statement of Changes in Shareholders' Equity
Share capital Share premium Capital redemption Own shares held in Retained earnings Total
equity
account reserve trust
�'000 �'000 �'000 �'000 �'000
�'000
As at 1 June 2006 893 9,732 3,127 (1,235) 2,756
15,273
Profit for the financial year - - - - 950
950
Share-based payment charge - - - - (53)
(53)
Deferred tax - - - - 14
14
Issue of new shares 2 - - - -
2
Premium on issue of new shares - 25 - - -
25
Dividends - - - - (296)
(296)
As at 31 May 2007 895 9,757 3,127 (1,235) 3,371
15,915
Pro*t for the financial year - - - - 2,234
2,234
Share-based payment charge - - - - 72
72
Deferred tax - - - - 12
12
Premium on issue of new shares - 9 - - -
9
Dividends - - - - (366)
(366)
As at 31 May 2008 895 9,766 3,127 (1,235) 5,323
17,876
Group Cash Flow Statement
Year ended Year ended
31 May 31 May
2008 2007
�'000 �'000
Cash *ows from operating activities
Cash generated from operations 4,712 2,109
Financial expense (21) (92)
Income tax paid (184) -
Net cash generated by operating activities 4,507 2,017
Cash *ows from investing activities
Acquisition of subsidiaries, net of overdrafts (1,669) -
acquired
Overdrafts acquired with subsidiaries (135) -
Purchases of property, plant and equipment (122) (227)
Capitalised development costs (591) (299)
Financial income 748 796
Net cash (used in)/ generated from investing (1,769) 270
activities
Cash *ows from *nancing activities
Repayment of borrowings (528) (992)
Issue of equity share capital 9 27
Dividends paid (366) (296)
Net cash used in *nancing activities (885) (1,261)
Net increase in cash and cash equivalents 1,853 1,026
Cash and cash equivalents at beginning of year 10,574 9,548
Cash and cash equivalents at end of year 12,427 10,574
Notes to the cash flow statement: Cash flows from operating activities
Year ended Year ended
31 May 31 May
2008 2007
�'000 �'000
Profit for the financial year 2,234 950
Taxation 1,052 384
Financial income (891) (803)
Financial expense 48 92
Profit from operations 2,443 623
Share-based payment charge/(credit) 72 (53)
Depreciation of property, plant and equipment 387 575
Amortisation of intangible assets 352 110
Decrease in trade and other receivables 752 196
Increase in trade and other payables 702 637
Loss on disposal of property, plant and equipment 2 -
Net movement on provisions 2 21
Cash generated from operations 4,712 2,109
1 Basis of preparation
The Board of Directors approved these preliminary audited results on 9 September 2007.
The financial information set out above is abridged and does not constitute the Company's statutory financial statements for the years
ended 31 May 2008 or 31 May 2007. Statutory financial statements for the year ended 31 May 2007 have been reported on by the Company's
auditors and delivered to the Registrar of Companies.
The statutory financial statements for the year ended 31 May 2008 will be posted no later than 7 October 2008 to shareholders and once
approved will be delivered to the Registrar of Companies following the Annual General Meeting on 6 November 2007. The report for the year
ended 31 May 2007 was unqualified.
Copies of the Annual Report and Financial Statements for the year ended 31 May 2008 will be available in due course from the Company
Secretary, System C Healthcare plc, Brenchley House, Week Street, Maidstone, ME14 1RF.
2 Segmental information
The Group's primary format for segmental reporting is business segment. As the business only operates in the UK the Group does not have
a secondary reporting format.
The Group's sole activity is the design, development and implementation of computer hardware and software. The directors consider it
appropriate to analyse the results and financial position of the Group in three distinct segments as this reflects how the business is
managed:
* The Products segment relates to business where the Group contracts directly with local NHS Trusts and other clinical
organisations;
* The Services segment relates to the business where the Group is subcontracted to perform work on behalf of other organisations
where the end customer is also either the NHS or other clinical organisations;
* Development and Shared Services relates to the Group's central research and development activities and support services provided
to the Products and Services segments.
The profit/(loss) before taxation of each segment includes any revenue and expenses directly attributable to or able to be allocated to
each such segment on a reasonable basis.
Segment assets and liabilities are those assets and liabilities directly attributable or which can be allocated to each such segment on
a reasonable basis.
Group
Year ended 31 May 2008
Products Services Development and Shared Services Total
�'000 �'000 �'000 �'000
Revenue 5,790 12,338 - 18,128
Pro*t/ (loss) from operations 2,316 4,992 (4,865) 2,443
Financial income 294 - 597 891
Financial expense (20) - (28) (48)
Pro*t/ (loss) before taxation 2,590 4,992 (4,296) 3,286
Total assets 3,261 3,267 17,388 23,916
Total liabilities (1,148) (755) (4,137) (6,040)
Net assets 2,113 2,512 13,251 17,876
Other segmental disclosures:
Capital expenditure - PPE 47 - 75 122
Capital expenditure - 27 - 564 591
Intangible assets
Depreciation of tangible 213 - 174 387
assets
Amortisation of intangible 142 - 210 352
assets
Share-based payment charge - - 72 72
Group
Year Ended 31 May 2007
Products Services Development and Shared Services Total
�'000 �'000 �'000 �'000
Revenue 3,488 9,985 - 13,473
Pro*t/ (loss) from operations 1,358 4,125 (4,860) 623
Financial income 318 - 485 803
Financial expense (88) - (4) (92)
Pro*t/ (loss) before taxation 1,588 4,125 (4,379) 1,334
Total assets 4,442 3,024 12,325 19,791
Total liabilities (1,694) (269) (1,913) (3,876)
Net assets 2,748 2,755 10,412 15,915
Other segmental disclosures
Capital expenditure - PPE 224 - 3 227
Capital expenditure - 61 - 239 299
Intangible assets
Depreciation of tangible 373 - 202 575
assets
Amortisation of intangible 87 - 23 110
assets
Impairment of trade (13) - - (13)
receivables
Share-based payment credit 0 - (53) (53)
3 Employees
Staff numbers
The average monthly number of people (including Executive Directors) employed during the year is as follows:
Group
Year ended Year ended
31 May 31 May
2008 2007
Number Number
Products 46 31
Services 97 95
Development and shared services 35 31
178 157
4 Profit before taxation
The following items have been included in arriving at profit before taxation:
Group
Year ended Year ended
31 May 31 May
2008 2007
�'000 �'000
Staff costs excluding share-based payments 9,472 8,523
Share-based payments charge/(credit) 72 (53)
Research and development expenditure 1,105 1,045
Depreciation of property, plant and equipment:
- Contract assets 212 373
- Other assets 175 202
Amortisation of intangible assets: 352 110
Operating lease rentals:
- Land and buildings 217 190
- Motor vehicles and other leases 55 78
Loss on disposal of property, plant and equipment 2 -
In addition to the research and development expenditure disclosed above, �591,000 was capitalised in respect of software development in
accordance with IAS 38 (2007: �299,000).
5 Taxation
* Analysis of tax charge in the year
Group
Year ended Year ended
31 May 31 May
2008 2007
�'000 �'000
Current tax:
United Kingdom corporation tax at 28%/30% 164 92
Adjustments in respect of previous years 24 -
Total current tax charge 188 92
Deferred tax:
Current year 822 301
Adjustments in respect of previous years 42 (9)
Total deferred tax charge 864 292
Total tax charge in the income statement (note 1,052 384
5(b))
Tax on items credited/(charged) to equity:
Deferred tax on share-based payment (12) (14)
(b) Factors affecting the tax charge for the year
The total tax charge for the year differs from the standard rate of UK Corporation Tax of 28% (2007: 30%) as explained below:
Group
Year ended Year ended
31 May 31 May
2008 2007
�'000 �'000
Profit before tax 3,286 1,334
Profit before tax multiplied by standard rate of 920 400
UK Corporation Tax of 28%/30%
Effects of:
- Permanent differences 117 71
- Rate differences on current tax - (53)
- Tax difference arising on treatment of share - (25)
options
- Amortisation of intangibles not deductible (51) -
- Adjustments in respect of prior years - 24 -
Current tax
- Adjustments in respect of prior years - 42 (9)
Deferred tax
Total tax charge (Note 5(a)) 1,052 384
(c) Deferred tax reconciliation
Group
Year ended Year ended
31 May 31 May
2008 2007
�'000 �'000
At 1 June (net) 927 1,205
Debited to goodwill (466) -
Charged to the income statement (864) (292)
Credited to shareholders' equity 12 14
At 31 May (net) (391) 927
6 Earnings per share
Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the year, excluding those that are held in the employee share trust, which are treated as cancelled.
For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive
potential ordinary shares that have satisfied the appropriate criteria as at 31 May 2008.
A reconciliation between the weighted average number of shares used in the calculations of basic and diluted earnings per share is set
out below:
Year ended 31 May 2008 Year ended 31 May 2007
Earnings Weighted average Per share amount Earnings Weighted average Per share amount
number of shares number of shares
�'000 Number Pence �'000 Number Pence
Basic EPS
Earnings attributable to 2,234 2.56 950 87,148,360 1.09
ordinary shareholders 87,243,442
Effect of dilutive shares 526,856 (0.02) 451,949 (0.01)
Diluted EPS 2,234 87,770,298 2.54 950 87,600,309 1.08
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR FKCKPOBKDFCK
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