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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Xploite | LSE:XPT | London | Ordinary Share | GB00B037D647 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 38.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMXPT
RNS Number : 1546U
XploiTe PLC
19 June 2009
19 June 2009
Xploite plc
Interim Results for the six months ended 30 April 2009
Xploite plc ("Xploite", "the Group", AIM: XPT), the operator and aggregator of
strategic and high-growth IT services businesses has published its interim
results for the six months to 30 April 2009.
Highlights
* Hardware and services (Anix business) turnover increased by 10.3% to GBP23.9m
(2008:GBP21.6m)
* Profit before integration and strategic costs increased by 21.1% to GBP2.0m
(2008: GBP1.7m)
* Basic EPS from Hardware and Services increased to 1.65p from loss of 0.54p
* Storage Resource Analysis product launched by software division
* Post half year end: Disposal of Hardware and Services division to ACS Business
Process Solutions for GBP28.5m in cash
Ian Smith, Xploite Chief Executive commented,
"With the disposal of Anix, we have delivered on our corporate strategy by
providing shareholders with excellent returns in a relatively short time and
during a very difficult economic period.
"With the benefit of having a strong balance sheet at time when valuations are
very attractive, we are in an excellent position to create further shareholder
value through identifying, acquiring, actively managing and disposing of ITC
assets and businesses. We are now actively reviewing a number of options.
"Meanwhile, whilst Storage Fusion has had a slower than expected start to this
financial year, there is considerable interest in its products and its pipeline
remains strong. We are optimistic that this will convert into sales during the
second half of the year."
Enquiries
+-------------------------------------------+-------------------------------------+
| Xploite plc www.xploite.com | 0870 737 2001 |
+-------------------------------------------+-------------------------------------+
| Ian Smith, Chief Executive Officer | |
+-------------------------------------------+-------------------------------------+
| Robert Arrowsmith Finance Director | |
+-------------------------------------------+-------------------------------------+
| | |
+-------------------------------------------+-------------------------------------+
| KBC Peel Hunt Ltd | 0207 418 8900 |
+-------------------------------------------+-------------------------------------+
| Richard Kauffer | |
+-------------------------------------------+-------------------------------------+
| | |
+-------------------------------------------+-------------------------------------+
| College Hill | 020 7457 2020 |
+-------------------------------------------+-------------------------------------+
| Adrian Duffield / Jon Davies | |
+-------------------------------------------+-------------------------------------+
Strategy Overview
The Group's strategy is to identify, acquire, consolidate and develop and where
appropriate, sell businesses in the IT services sector. The Board's aim is to
create shareholder value by acquiring businesses with good strategic fit. These
are then integrated and consolidated into existing operations. Costs are reduced
through the efficient deployment of people, processes and technologies, and
recurring revenue streams are developed.
After the end of the six months period to 30 April 2009 and to deliver the
second successful "buy and build" disposal, the Group exchanged contracts for
the sale of the Hardware and Services division, the Anix Group and on 12 June,
after having obtained shareholder approval, completed on the sale. The sale was
for a total of GBP31.5m with a reduction for debt and working capital estimated
to be GBP3.0m.
This disposal is entirely consistent with the Group's strategy and provided an
excellent cash return at a time of considerable market uncertainly. The sales
proceeds represent a multiple of 13.5 x EBIT for the year ended 31 October 2008
and generated an IRR for the Group of 39% on the total invested capital in Anix.
During the period under review, there were two events that have supported this
strategy:
1. On 1 November 2008 a separate software division was formed in order to focus
on the innovative Storage Resource Analysis (SRA) technology owned by Storage
Fusion Limited.
2. On 15 December 2008 the Group acquired Blue River Systems Limited, together
with the assets of three managed IT services businesses from Cantono plc.
Operationally, the main focus for the six months to 30 April 2009 was to further
develop the Anix brand, integrating the business of Blue River Systems Limited
into Anix and developing the nascent software division Storage Fusion.
The objective for the enlarged Anix business was to become the UK's leading
mid-market managed service provider with a focus on storage and server
infrastructure with a strong recurring revenue stream.
The Group has invested in the development of the SRA software which enables the
Group to provide storage analytics as a service solution. The Board's
expectation in the year to 31 October 2009 is to sell more licences of this
nature. Storage Fusion also expects to set up a portal which will allow
customers anywhere in the world to log on and utilise the software on an as used
basis. In addition to this, the board is in discussion with major storage
vendors to deliver branded SRA portals. Storage Fusion's sales momentum has been
slower to develop than originally envisaged and this will mean that the pipeline
will take longer to translate into turnover and profit.
Financial review
These results have been prepared under International Financial Reporting
Standards (IFRS) as adopted by the EU.
As the Group was going through the process of the disposal of Anix prior to the
period end the Anix business has been presented as a discontinued activity in
the interim statements and the Anix assets and liabilities have been presented
as held for sale in accordance with accounting standards.
The layout used in the statutory numbers is prescribed by IFRS. In order to
highlight numbers that the Board consider important and that management use to
manage the business, the table below has been prepared in order to show the
relationship between the statutory IFRS numbers and those referred to in this
review.
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | April 2009 | | April 2008 |
+---------------------+------------------------------------------+---+------------------------------------------+
| | Hardware | Software | Central | Total | | Hardware | Software | Central | Total |
| | and | GBP'000 | GBP'000 | GBP'000 | | and | GBP'000 | GBP'000 | GBP'000 |
| | Services | | | | | Services | | | |
| | GBP'000 | | | | | GBP'000 | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Total revenue | 23,855 | 67 | - | 23,922 | | 21,621 | 869 | - | 22,490 |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Cost of sales | (17,365) | (5) | - | (17,370) | | (16,094) | (131) | - | (16,225) |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Gross profit | 6,490 | 62 | - | 6,552 | | 5,527 | 738 | - | 6,265 |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Gross profit % | 27.2% | 92.5% | - | 27.4% | | 25.6% | 84.9% | - | 27.9% |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Overheads | (3,738) | (262) | (996) | (4,996) | | (3,394) | (533) | (762) | (4,689) |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Depreciation and | (708) | (147) | (612) | (1,467) | | (445) | (36) | (1,420) | (1,901) |
| amortisation | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Profit before | 2,044 | (347) | (1,608) | 89 | | 1,688 | 169 | (2,182) | (325) |
| integration and | | | | | | | | | |
| strategic costs | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Integration and | (1,109) | - | - | (1,109) | | (572) | (52) | - | (624) |
| strategic costs | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Gain on disposal of | 192 | - | - | 192 | | - | - | - | - |
| trade and | | | | | | | | | |
| assets | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Financing costs | (54) | - | (183) | (237) | | (52) | - | (296) | (348) |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Profit/(Loss) | 1,073 | (347) | (1,791) | (1,065) | | 1,064 | 117 | (2,478) | (1,297) |
| before tax | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Tax credit/(charge) | (75) | 14 | 163 | 102 | | - | - | 376 | 376 |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
| Profit/(Loss) after | 998 | (333) | (1,628) | (963) | | 1,064 | 117 | (2,102) | (921) |
| tax | | | | | | | | | |
+---------------------+----------+----------+---------+----------+---+----------+----------+---------+----------+
Hardware and Services (discontinued operations)
The revenue in the Anix Group (Hardware and Services) rose by 10.3% from
GBP21.6m to GBP23.9m for the six months to 30 April 2009. The gross profit
margin has increased from 25.6% to 27.2% in 2009, driven by the increase in
higher margin managed services. The profit before integration and strategic
costs has increased 21.1% to GBP2.0m leading to an increase in basic
earnings/(loss) per share from (0.54)p to 1.65p.
Software
The revenue for the software division has fallen from GBP0.9m to GBP0.1m. This
is due to the disposal of Itheon on 31 October 2008. The GBP0.1m represents the
first sales of the newly developed SRA software by Storage Fusion Limited.
Balance Sheet
Group net debt at 30 April 2009 was GBP10.9m compared to GBP7.4m at 30 April
2008 an increase of GBP3.4m
made up of:
+------------------+---+---------+---------+
| | | 2009 | 2008 |
+------------------+---+---------+---------+
| Bank debt | | GBP8.4m | GBP6.1m |
+------------------+---+---------+---------+
| HP & finance | | GBP2.5m | GBP1.3m |
| leases | | | |
+------------------+---+---------+---------+
The increase in the level of debt is due primarily to increased capital
expenditure in the Group's data centres, the payment of deferred consideration
due on the original Itheon purchase and the purchase of intangible assets.
Following the sale of Anix and the receipt of sale proceeds of GBP28.5m, the
bank debt has been settled. Further, GBP1.6m of the HP and finance leases have
been sold with the business.
Current trading and outlook
The disposal of the Anix business has left the Group in a strong cash position.
The Board is now considering the most appropriate way to re-invest the proceeds
of sale in line with its chosen strategy and to provide attractive future
returns for shareholders.
Consolidated income statement
Six months ended 30 April 2009
+----------------------------------------+-------+-------------+-------------+-------------+
| |Notes | Unaudited | Unaudited | Year ended |
| | | 6 months | 6 months | 31 October |
| | | ended | ended | 2008 |
| | | 30 April | 30 April | GBP'000 |
| | | 2009 | 2008 | |
| | | GBP'000 | GBP'000 | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Continuing operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Revenue | 4 | 67 | - | 1,800 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Cost of sales | | (5) | - | - |
+----------------------------------------+-------+-------------+-------------+-------------+
| Gross profit | | 62 | - | 1,800 |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Total administrative expenses | | (1,539) | (788) | (2,512) |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Adjusted* EBITDA | | (1,196) | (762) | (567) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Less: depreciation | | (31) | (26) | (60) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Adjusted EBITA | | (1,227) | (788) | (627) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Less: amortisation and impairment of | | (250) | - | - |
| intangibles | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Less: integration and strategic costs | | - | - | (85) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Operating loss | 4 | (1,477) | (788) | (712) |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Finance income | | - | - | 87 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Finance cost | | (183) | (296) | (672) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Finance cost | | (183) | (296) | (585) |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Loss before tax | | (1,660) | (1,084) | (1,297) |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Tax credit | | 43 | 376 | 655 |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Loss for the period from continuing | | (1,617) | (708) | (642) |
| operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Discontinued operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Profit/(loss) for the period from | 4 | 654 | (213) | 2,183 |
| discontinued operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| (Loss)/profit for the period | | (963) | (921) | 1,541 |
| attributable to equity shareholders | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| (Loss)/earnings per ordinary share | 5 | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| - basic | | (2.44) | (2.33) | 3.98 |
+----------------------------------------+-------+-------------+-------------+-------------+
| - diluted | | (2.44) | (2.33) | 3.86 |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Loss per ordinary share from | 5 | | | |
| continuing operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| - basic | | (4.09) | (1.79) | (1.66) |
+----------------------------------------+-------+-------------+-------------+-------------+
| - diluted | | (4.09) | (1.79) | (1.66) |
+----------------------------------------+-------+-------------+-------------+-------------+
*Adjusted for integration and strategic costs
Consolidated balance sheet
+-------------------------------------+-------+--------------+--------------+--------------+
| |Notes | Unaudited | Unaudited | 31 October |
| | | 30 April | 30 April | 2008 |
| | | 2009 | 2008 | GBP'000 |
| | | GBP'000 | GBP'000 | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Assets | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Non-current assets | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Intangible assets | | 6,153 | 32,155 | 29,432 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Property, plant and equipment | | 174 | 2,177 | 2,496 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Deferred tax assets | | - | 324 | 188 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Trade and other receivables | | - | 2,415 | 6,259 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Deferred consideration on disposals | | - | 35 | - |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | 6,327 | 37,106 | 38,375 |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Current assets | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Inventories | | - | 2 | - |
+-------------------------------------+-------+--------------+--------------+--------------+
| Trade and other receivables | | 161 | 14,419 | 15,077 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Deferred consideration on disposals | | 1,108 | - | 1,120 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Cash and cash equivalents | | - | 634 | 7,749 |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | 1,269 | 15,055 | 23,946 |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Non-current assets and disposal | 7 | 47,545 | - | - |
| groups held for sale | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Total assets | | 55,141 | 52,161 | 62,321 |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Liabilities | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Current liabilities | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Trade and other payables | | (683) | (18,873) | (23,765) |
+-------------------------------------+-------+--------------+--------------+--------------+
| Deferred consideration on | | (914) | (3,284) | (3,119) |
| acquisitions | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Current tax liabilities | | (1,549) | (926) | (1,323) |
+-------------------------------------+-------+--------------+--------------+--------------+
| Borrowings | | (4,505) | (1,962) | (2,247) |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | (7,651) | (25,045) | (30,454) |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Non-current liabilities | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Borrowings | | (4,261) | (6,066) | (5,656) |
+-------------------------------------+-------+--------------+--------------+--------------+
| Trade and other payables | | - | (3,295) | (6,531) |
+-------------------------------------+-------+--------------+--------------+--------------+
| Deferred tax liabilities | | (245) | (2,891) | (2,312) |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | (4,506) | (12,252) | (14,499) |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Non-current liabilities and | 7 | (26,468) | - | - |
| disposal groups held for sale | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Total liabilities | | (38,625) | (24,953) | (44,953) |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Net assets | | 16,516 | 14,864 | 17,368 |
+-------------------------------------+-------+--------------+--------------+--------------+
| | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Shareholders' equity | | | | |
+-------------------------------------+-------+--------------+--------------+--------------+
| Called up share capital | 8 | 3,952 | 3,952 | 3,952 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Share premium account | | 1,647 | 1,647 | 1,647 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Merger reserve | | 3,511 | 3,511 | 3,511 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Profit and loss account | | 6,965 | 5,457 | 7,928 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Share based payment reserve | | 441 | 297 | 330 |
+-------------------------------------+-------+--------------+--------------+--------------+
| Total shareholders' equity | | 16,516 | 14,864 | 17,368 |
+-------------------------------------+-------+--------------+--------------+--------------+
Consolidated statement of changes in equity
Six months ended 30 April 2009
+---------------------------------------+-------------+-------------+-------------+
| | Unaudited | Unaudited | Year ended |
| | 6 months | 6 months | 31 October |
| | ended | ended | 2008 |
| | 30 April | 30 April | GBP'000 |
| | 2009 | 2008 | |
| | GBP'000 | GBP'000 | |
+---------------------------------------+-------------+-------------+-------------+
| Shareholders' equity at beginning of | 17,368 | 15,679 | 15,688 |
| period | | | |
+---------------------------------------+-------------+-------------+-------------+
| (Loss)/profit for the period | (963) | (921) | 1,541 |
+---------------------------------------+-------------+-------------+-------------+
| Increase in share based payment | 111 | 106 | 139 |
| reserve | | | |
+---------------------------------------+-------------+-------------+-------------+
| Shareholders' equity at end of period | 16,516 | 14,864 | 17,368 |
+---------------------------------------+-------------+-------------+-------------+
Consolidated cash flow statement
Six months ended 30 April 2009
+----------------------------------------+-------+------------+------------+-------------+
| | Note | Unaudited | Unaudited | Year ended |
| | | 6 months | 6 months | 31 October |
| | | ended | ended | 2008 |
| | | 30 April | 30 April | GBP'000 |
| | | 2009 | 2008 | |
| | | GBP'000 | GBP'000 | |
+----------------------------------------+-------+------------+------------+-------------+
| | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Cash flows from operating activities | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Cash (used in) /generated from | (a) | (6,107) | (6,512) | 2,184 |
| operations | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Interest received | | - | 18 | 87 |
+----------------------------------------+-------+------------+------------+-------------+
| Interest paid | | (210) | (265) | (502) |
+----------------------------------------+-------+------------+------------+-------------+
| Tax received/(paid) | | 142 | (80) | 666 |
+----------------------------------------+-------+------------+------------+-------------+
| Net cash flows from operating | | (6,175) | (6,839) | 2,435 |
| activities | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Cash flows from investing activities | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Acquisition of subsidiaries (net of | | (121) | (62) | (123) |
| cash acquired) | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Deferred consideration paid on prior | | (2,205) | - | - |
| period acquisitions | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Disposal of subsidiaries/trade and | | 192 | - | 1,875 |
| assets (net of cash disposed) | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Purchase of intangible assets | | (1,190) | (488) | (669) |
+----------------------------------------+-------+------------+------------+-------------+
| Purchase of property, plant and | | (579) | (187) | (597) |
| equipment | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Net cash flows used in investing | | (3,903) | (737) | 486 |
| activities | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Cash flows from financing activities | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Net proceeds from issue of bank loan | | - | 3,000 | 2,970 |
+----------------------------------------+-------+------------+------------+-------------+
| Finance lease principal payments | | (980) | (239) | (2,015) |
+----------------------------------------+-------+------------+------------+-------------+
| Repayment of borrowings | | (250) | (200) | (352) |
+----------------------------------------+-------+------------+------------+-------------+
| Net cash used in financing activities | | (1,230) | 2,561 | 603 |
+----------------------------------------+-------+------------+------------+-------------+
| | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Net (decrease)/increase in cash and | | (11,308) | (5,015) | 3,524 |
| cash equivalents | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Cash and cash equivalents at start of | | 7,749 | 4,225 | 4,225 |
| period | | | | |
+----------------------------------------+-------+------------+------------+-------------+
| Cash and cash equivalents at end of | (b) | (3,559) | (790) | 7,749 |
| period | | | | |
+----------------------------------------+-------+------------+------------+-------------+
Notes to the consolidated cash flow statement
(a) Cash generated from operations
+----------------------------------------+-------+-------------+-------------+-------------+
| | | Unaudited | Unaudited | Unaudited |
| | | 6 months | 6 months | Year ended |
| | | ended | ended | 31 October |
| | | 30 April | 30 April | 2008 |
| | | 2009 | 2008 | GBP'000 |
| | | GBP'000 | GBP'000 | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Continuing operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Net loss before tax | | (1,660) | (1,025) | (2,906) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Adjustments for: | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Finance cost - net | | 183 | 182 | 438 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Depreciation | | 31 | 26 | 60 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Amortisation | | 250 | - | - |
+----------------------------------------+-------+-------------+-------------+-------------+
| Share based payment charge | | 111 | 106 | 139 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Decrease in trade and other | | 412 | 44 | 491 |
| receivables | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| (Decrease)/increase in trade and other | | (1,088) | 878 | (419) |
| payables | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Cash (used in)/generated from | | (1,761) | 211 | (2,197) |
| continuing operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
+----------------------------------------+-------+-------------+-------------+-------------+
| Discontinued operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Net profit/(loss) before tax | | 403 | (272) | 2,052 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Adjustments for: | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Finance cost - net | | 54 | 166 | 203 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Depreciation | | 676 | 463 | 1,036 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Amortisation | | 510 | 1,411 | 2,177 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Decrease in inventories | | - | 18 | 20 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Decrease/(increase) in trade and other | | 2,215 | 462 | (5,145) |
| receivables | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| (Decrease)/increase in trade and other | | (8,204) | (8,971) | 4,038 |
| payables | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Cash (used in)/generated from | | (4,346) | (6,723) | 4,381 |
| discontinued operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
+----------------------------------------+-------+-------------+-------------+-------------+
| Cash (used in)/generated from | | (6,107) | (6,512) | 2,184 |
| operations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
(b) Reconciliation of net cash flow to movement in net (debt)/funds
+----------------------------------------+-------+-------------+-------------+-------------+
| | | Unaudited | Unaudited | Year ended |
| | | 6 months | 6 months | 31 October |
| | | ended | ended | 2008 |
| | | 30 April | 30 April | GBP'000 |
| | | 2009 | 2008 | |
| | | GBP'000 | GBP'000 | |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| (Decrease)/increase in cash in the | | (11,308) | (5,015) | 3,524 |
| period | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Net cash outflow/(inflow) in respect | | 250 | (2,800) | (2,618) |
| of bank loan | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Cash outflow in respect of finance | | 980 | 239 | 2,015 |
| leases | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Changes resulting from cash flows | | (10,078) | (7,576) | 2,921 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Non cash changes: | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Loans and finance leases acquired with | | | - | - |
| subsidiaries | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| New finance leases | | (645) | (670) | (3,915) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Amortisation of loan issue costs | | (6) | - | (12) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Change in net debt | | (10,729) | (8,246) | (1,006) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Net funds at beginning of period | | (154) | 852 | 852 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Net debt at end of period | | (10,883) | (7,394) | (154) |
+----------------------------------------+-------+-------------+-------------+-------------+
+----------------------------------------+-------+-------------+-------------+-------------+
| Analysis of net (debt)/funds | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Cash and cash equivalents and bank | | (3,559) | (790) | 7,749 |
| overdrafts | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Hire purchase and finance lease | | (2,463) | (1,306) | (2,798) |
| obligations | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Bank loan | | (4,861) | (5,298) | (5,105) |
+----------------------------------------+-------+-------------+-------------+-------------+
| Net debt | | (10,883) | (7,394) | (154) |
+----------------------------------------+-------+-------------+-------------+-------------+
+----------------------------------------+-------+-------------+-------------+-------------+
| Cash and cash equivalents and bank | | | | |
| overdrafts | | | | |
+----------------------------------------+-------+-------------+-------------+-------------+
| Cash at bank and in hand | | - | 634 | 7,749 |
+----------------------------------------+-------+-------------+-------------+-------------+
| Overdrafts | | (3,559) | (1,424) | - |
+----------------------------------------+-------+-------------+-------------+-------------+
| | | (3,559) | (790) | 7,749 |
+----------------------------------------+-------+-------------+-------------+-------------+
Notes to the Interim Results
1. Approval of results
The interim statement for the six months ended 30 April 2009 was approved by the
Board of Directors on 18 June 2009. They have not been reviewed or audited by
the Company's auditors.
This statement does not constitute statutory accounts within the meaning of the
Companies Act 1985 and are unaudited. The figures for the six months ended 30
April 2008 have been extracted from the unaudited 2008 interim statement. The
results for the year ended 31 October 2008 have been extracted from the audited
financial statements for that year.
2. Summary of significant accounting policies
(a) Basis of preparation
The statement for the six months ended 30 April 2009 have been prepared in
accordance with the accounting policies adopted in the preparation of the
financial statements for the year ended 31 October 2008 and those expected to
apply for the year ended 31 October 2009 which will be set out in the Company's
annual report.
(b) Consolidation
The results and net assets of subsidiary undertakings acquired are included in
the consolidated income statement and consolidated balance sheet using the
acquisition method of accounting from the effective date at which control is
obtained by the Group. Subsidiary undertakings ceases to be consolidated from
the date at which the Group no longer retains control. Control comprises the
power to govern the financial and operating policies of the investee so as to
obtain benefits from their activities, and is achieved through direct or
indirect ownership of voting rights or by way of contractual agreement. All
inter-company balances and transactions are eliminated in full.
3. Discontinued operations and disposal group
On 27 March 2009, the group received a letter of intent for the sale of 100% of
the VBHG Ltd group. The VBHG Ltd group owns the Anix Holdings Ltd trading group.
On 26 May the Group exchanged contracts for the sale of the VBHG Ltd group and
on 12 June, after having obtained shareholder approval, completed on the sale.
The sale was for a total cash consideration of GBP31.5m with a reduction for
debt and working capital estimated to be GBP3.5m. In accordance with relevant
accounting standards, its results are presented in this interim financial
information as a discontinued operation, and the comparative figures with
respect to these operations have been restated. The assets and liabilities
related to the VBHG Ltd group have been presented as held for sale following the
events noted above. Details of these assets and liabilities are set out in note
7 to this interim financial information.
4. Segmental analysis
The analysis used by management in monitoring the Group's risks and returns is
by operation as presented below:
+--------------------------+----------+----------+----------------+----------+----------+----------+
| 30 April 2009 | Hardware | Services | Total Hardware | Software | Central | Total |
| | | | and Services | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Continuing operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Revenue | - | - | - | 67 | - | 67 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: intersegment sales | - | - | - | - | - | - |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total revenue from third | - | - | - | 67 | - | 67 |
| parties | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Cost of sales | - | - | - | (5) | - | (5) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Gross profit | - | - | - | 62 | - | 62 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total administrative | | | - | (409) | (1,130) | (1,539) |
| expenses | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITDA | | | - | (200) | (996) | (1,196) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: depreciation | | | - | (1) | (30) | (31) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITA | | | - | (201) | (1,026) | (1,227) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: amortisation and | | | - | (146) | (104) | (250) |
| impairment of intangible | | | | | | |
| assets | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: Integration and | | | - | - | - | - |
| strategic costs | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total operating loss | | | - | (347) | (1,130) | (1,477) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance cost | | | - | - | (183) | (183) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Loss before tax | | | - | (347) | (1,313) | (1,660) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Tax credit | | | - | 14 | 29 | 43 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Loss for the period from | | | - | (333) | (1,284) | (1,617) |
| continuing operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Profit/(loss) for the | | | 998 | - | (344) | 654 |
| period from discontinued | | | | | | |
| operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total profit/(loss) for | | | 998 | (333) | (1,628) | (963) |
| the period | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Discontinued operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Revenue | 12,399 | 11,766 | 24,165 | - | - | 24,165 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: intersegment sales | - | (310) | (310) | - | - | (310) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total revenue | 12,399 | 11,456 | 23,855 | - | - | 23,855 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Cost of sales | (10,097) | (7,268) | (17,365) | - | - | (17,365) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Gross profit | 2,302 | 4,188 | 6,490 | - | - | 6,490 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total administrative | | | (5,555) | - | (478) | (6,033) |
| expenses | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITDA | | | 2,752 | - | - | 2,752 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: depreciation | | | (676) | - | - | (676) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITA | | | 2,076 | - | - | 2,076 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: amortisation and | | | (32) | - | (478) | (510) |
| impairment of intangible | | | | | | |
| assets | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: Integration and | | | (1,109) | - | - | (1,109) |
| strategic costs | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total operating | | | 935 | - | (478) | 457 |
| profit/(loss) | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance income | | | 9 | - | - | 9 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance cost | | | (63) | - | - | (63) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance cost - net | | | (54) | - | - | (54) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Profit/(loss) before tax | | | 881 | - | (478) | 403 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Tax (charge)/credit | | | (75) | - | 134 | 59 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Post tax profit/(loss) | | | 806 | - | (344) | 462 |
| from discontinued | | | | | | |
| activities | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Gain on disposal of | | | 192 | - | - | 192 |
| trade and assets | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Profit/(loss) for the | | | 998 | - | (344) | 654 |
| period from discontinued | | | | | | |
| operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
+--------------------------+----------+----------+----------------+----------+----------+----------+
| 30 April 2008 | Hardware | Services | Total Hardware | Software | Central | Total |
| | | | and Services | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Continuing operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Revenue | - | - | - | - | - | - |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: intersegment sales | - | - | - | - | - | - |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total revenue from third | - | - | - | - | - | - |
| parties | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Cost of sales | - | - | - | - | - | - |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Gross profit | - | - | - | - | - | - |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total administrative | | | - | - | (788) | (788) |
| expenses | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITDA | | | - | - | (762) | (762) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: depreciation | | | - | - | (26) | (26) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITA | | | - | - | (788) | (788) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: amortisation and | | | - | - | - | - |
| impairment of intangible | | | | | | |
| assets | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: Integration and | | | - | - | - | - |
| strategic costs | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total operating loss | | | - | - | (788) | (788) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance income | | | - | - | - | - |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance cost | | | - | - | (296) | (296) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance cost - net | | | - | - | (296) | (296) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Loss before tax | | | - | - | (1,084) | (1,084) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Tax credit | | | - | - | 376 | 376 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Loss for the period from | | | - | - | (708) | (708) |
| continuing operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Profit/(loss) for the | | | 1,064 | 117 | (1,394) | (213) |
| period from discontinued | | | | | | |
| operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total profit for the | | | 1,064 | 117 | (2,102) | (921) |
| period | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Discontinued operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Revenue | 11,644 | 9,977 | 21,621 | 899 | - | 22,520 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: intersegment sales | - | - | - | (30) | - | (30) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total revenue | 11,644 | 9,977 | 21,621 | 869 | - | 22,490 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Cost of sales | (9,937) | (6,157) | (16,094) | (131) | - | (16,225) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Gross profit | 1,707 | 3,820 | 5,527 | 738 | - | 6,265 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total administrative | | | (4,411) | (621) | (1,394) | (6,426) |
| expenses | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITDA | | | 2,133 | 204 | - | 2,337 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: depreciation | | | (445) | (18) | - | (463) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Adjusted EBITA | | | 1,688 | 186 | - | 1,874 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: amortisation and | | | - | (17) | (1,394) | (1,411) |
| impairment of intangible | | | | | | |
| assets | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Less: Integration and | | | (572) | (52) | - | (624) |
| strategic costs | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Total operating | | | 1,116 | 117 | (1,394) | (161) |
| profit/(loss) | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance income | | | 18 | - | - | 18 |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance cost | | | (70) | - | - | (70) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Finance cost - net | | | (52) | - | - | (52) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Profit/(loss) before tax | | | 1,064 | 117 | (1,394) | (213) |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Tax | | | - | - | - | - |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| Profit/(loss) for the | | | 1,064 | 117 | (1,394) | (213) |
| period from discontinued | | | | | | |
| operations | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
| | | | | | | |
+--------------------------+----------+----------+----------------+----------+----------+----------+
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| 31 October 2008 | Hardware | Services | Total Hardware | Software | Central | Total |
| | | | and Services | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Continuing operations | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Revenue | - | - | - | 1,800 | - | 1,800 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: intersegment sales | - | - | - | - | - | - |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Total revenue from third | - | - | - | 1,800 | - | 1,800 |
| parties | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Cost of sales | - | - | - | - | - | - |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Gross profit | - | - | - | 1,800 | - | 1,800 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Total administrative expenses | | | | (175) | (2,337) | (2,512) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Adjusted EBITDA | | | - | 1,625 | (2,192) | (567) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: depreciation | | | - | - | (60) | (60) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Adjusted EBITA | | | - | 1,625 | (2,252) | (627) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: amortisation and | | | - | - | - | - |
| impairment of intangible | | | | | | |
| assets | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: Integration and | | | - | - | (85) | (85) |
| strategic costs | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Total operating profit/(loss) | | | - | 1,625 | (2,337) | (712) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Finance income | | | - | - | 87 | 87 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Finance cost | | | - | (1) | (671) | (672) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Finance cost - net | | | - | (1) | (584) | (585) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Profit/(loss) before tax | | | - | 1,624 | (2,921) | (1,297) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Tax credit | | | - | - | 655 | 655 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Profit/(loss) for the year | | | - | 1,624 | (2,266) | (642) |
| from continuing operations | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Profit/(loss) for the year | | | 2,180 | 450 | (447) | 2,183 |
| from discontinued operations | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Total profit/(loss) for the | | | 2,180 | 2,074 | (2,713) | 1,541 |
| year | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Discontinued operations | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Revenue | 21,754 | 22,901 | 44,655 | 1,779 | - | 46,434 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: intersegment sales | - | (140) | (140) | (87) | - | (227) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Total revenue | 21,754 | 22,761 | 44,515 | 1,692 | - | 46,207 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Cost of sales | (18,458) | (15,232) | (33,690) | (395) | - | (34,085) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Gross profit | 3,296 | 7,529 | 10,825 | 1,297 | - | 12,122 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Total administrative expenses | | | (8,675) | (847) | (2,101) | (11,623) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Adjusted EBITDA | | | 4,300 | 583 | - | 4,883 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: depreciation | | | (1,009) | (27) | - | (1,036) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Adjusted EBITA | | | 3,291 | 556 | - | 3,847 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: amortisation and | | | (22) | (54) | (2,101) | (2,177) |
| impairment of intangible | | | | | | |
| assets | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Less: Integration and | | | (1,119) | (52) | - | (1,171) |
| strategic costs | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Total operating profit/(loss) | | | 2,150 | 450 | (2,101) | 499 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Finance income | | | 60 | - | - | 60 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Finance cost | | | (116) | - | - | (116) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Finance cost - net | | | (56) | - | | (56) |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Profit/(loss) before tax | | | 2,094 | 450 | (2,101) | 443 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Tax credit | | | 86 | 8 | 64 | 158 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Post tax profit/(loss) from | | | 2,180 | 458 | (2,037) | 601 |
| discontinued activities | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| (Loss)/gain on disposal of | | | - | (8) | 1,120 | 1,112 |
| subsidiary | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Taxation | | | - | - | 470 | 470 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Net gain on disposal | | | - | (8) | 1,590 | 1,582 |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| Profit/(loss) for the period | | | 2,180 | 450 | (447) | 2,183 |
| from discontinued operations | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
| | | | | | | |
+--------------------------------+----------+----------+----------------+----------+---------+----------+
5. Earnings per share
In accordance with IAS 33, the calculation of (loss)/profit per ordinary share
is based upon:
+----------------------------------+-------------+--------------+-------------+
| 30 April 2009 | Continuing | Discontinued | Total |
| | | | |
+----------------------------------+-------------+--------------+-------------+
| | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------+-------------+--------------+-------------+
| | | | |
+----------------------------------+-------------+--------------+-------------+
| (Loss)/profit attributable to | (1,617) | 654 | (963) |
| equity holders | | | |
+----------------------------------+-------------+--------------+-------------+
| Adjustments: | | | |
+----------------------------------+-------------+--------------+-------------+
| Amortisation of intangible | 250 | 510 | 760 |
| assets | | | |
+----------------------------------+-------------+--------------+-------------+
| Integration and strategic costs | - | 1,109 | 1,109 |
+----------------------------------+-------------+--------------+-------------+
| Adjusted loss/profit | (1,367) | 2,273 | 906 |
+----------------------------------+-------------+--------------+-------------+
| | | | |
+----------------------------------+-------------+--------------+-------------+
| | Pence | Pence | Pence |
+----------------------------------+-------------+--------------+-------------+
| | | | |
+----------------------------------+-------------+--------------+-------------+
| Basic earnings per share | (4.09) | 1.65 | (2.44) |
+----------------------------------+-------------+--------------+-------------+
| Diluted earnings per share | (3.95) | 1.60 | (2.35) |
+----------------------------------+-------------+--------------+-------------+
| Adjusted basic earnings per | (3.46) | 5.75 | 2.29 |
| share | | | |
+----------------------------------+-------------+--------------+-------------+
| Adjusted diluted earnings per | (3.34) | 5.55 | 2.21 |
| share | | | |
+----------------------------------+-------------+--------------+-------------+
| | | | |
+----------------------------------+-------------+--------------+-------------+
| | Number | Number | Number |
+----------------------------------+-------------+--------------+-------------+
| | | | |
+----------------------------------+-------------+--------------+-------------+
| Basic weighted average number of | 39,516,955 | 39,516,955 | 39,516,955 |
| shares | | | |
+----------------------------------+-------------+--------------+-------------+
| Impact of share options | 1,417,585 | 1,417,585 | 1,417,585 |
+----------------------------------+-------------+--------------+-------------+
| Diluted weighted average number | 40,934,540 | 40,934,540 | 40,934,540 |
| of shares | | | |
+----------------------------------+-------------+--------------+-------------+
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | 30 April 2008 | | 31 October 2008 |
+-------------------------+------------------------------------------+--+------------------------------------------+
| | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | Continuing | Discontinued | Total | | Continuing | Discontinued | Total |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | GBP'000 | GBP'000 | GBP'000 | | GBP'000 | GBP'000 | GBP'000 |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| (Loss)/profit | (708) | (213) | (921) | | (642) | 2,183 | 1,541 |
| attributable to equity | | | | | | | |
| holders | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Adjustments: | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Amortisation of | - | 1,411 | 1,411 | | - | 2,177 | 2,177 |
| intangible assets | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Integration and | - | 624 | 624 | | 85 | 1,171 | 1,256 |
| strategic costs | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Adjusted (loss)/profit | (708) | 1,822 | 1,114 | | (557) | 5,531 | 4,974 |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | Pence | Pence | Pence | | Pence | Pence | Pence |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Basic (loss)/earnings | (1.79) | (0.54) | (2.33) | | (1.66) | 5.64 | 3.98 |
| per share | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Diluted (loss)/earnings | (1.79) | (0.54) | (2.33) | | (1.61) | 5.47 | 3.86 |
| per share | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Adjusted basic (loss)/ | (1.79) | 4.61 | 2.82 | | (1.44) | 14.29 | 12.85 |
| earnings per share | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Adjusted diluted | (1.79) | 4.61 | 2.82 | | (1.40) | 13.86 | 12.47 |
| (loss)/earnings per | | | | | | | |
| share | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | Number | Number | Number | | Number | Number | Number |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Basic weighted average | 39,516,955 | 39,516,955 | 39,516,955 | | 38,715,830 | 38,715,830 | 38,715,830 |
| number of shares | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Impact of share options | - | - | - | | 1,184,719 | 1,184,719 | 1,184,719 |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
| Diluted weighted | 39,516,955 | 39,516,955 | 39,516,955 | | 39,900,549 | 39,900,549 | 39,900,549 |
| average number of | | | | | | | |
| shares | | | | | | | |
+-------------------------+-------------+--------------+-------------+--+-------------+--------------+-------------+
Where there is a loss, the share options are not dilutive and hence the diluted
earnings per share is the same as basic. In the period to 30 April 2008, the
share options did not have a dilutive effect on the number of shares in issue.
6. Acquisitions
On 15th December 2008, the group acquired 100% of the share capital of Blue
River Systems Limited and the trade and assets of three managed IT services
businesses from Cantono plc. Details of net liabilities acquired and goodwill
are as follows:
+---------------------------------------+--------------+
| | GBP'000 |
+---------------------------------------+--------------+
| | |
+---------------------------------------+--------------+
| Purchase consideration | |
+---------------------------------------+--------------+
| - Release of debt due to subsidiary | 1,904 |
| of Xploite plc from Cantono plc | |
+---------------------------------------+--------------+
| - Costs in relation to the | 97 |
| acquisition - cash paid | |
+---------------------------------------+--------------+
| Total consideration | 2,001 |
+---------------------------------------+--------------+
| Provisional fair value of net | 1,095 |
| liabilities acquired (see below) | |
+---------------------------------------+--------------+
| Provisional goodwill | 3,096 |
+---------------------------------------+--------------+
The goodwill is attributable to the synergies expected to arise as a result of
its acquisition by the group.
The assets and the liabilities arising from the acquisition are as follows:
+---------------------------------------+----------------+-------------+
| | Acquirees | Provisional |
| | carrying | fair value |
| | amount | |
+---------------------------------------+----------------+-------------+
| | GBP'000 | GBP'000 |
+---------------------------------------+----------------+-------------+
| | | |
+---------------------------------------+----------------+-------------+
| Property, plant and equipment | 545 | 261 |
+---------------------------------------+----------------+-------------+
| Inventory | 20 | - |
+---------------------------------------+----------------+-------------+
| Trade and other receivables | 1,060 | 784 |
+---------------------------------------+----------------+-------------+
| Trade and other payables | (1,170) | (2,140) |
+---------------------------------------+----------------+-------------+
| | 455 | (1,095) |
+---------------------------------------+----------------+-------------+
This acquisition is included within the disposal group at 30 April 2009.
Issues of dispute have arisen with regard to the sale and purchase agreement
between the Group and Cantono plc arising from the above acquisition. The
dispute has arisen over the amount of deferred consideration that was due to be
paid to Cantono on 15th March 2009 in view of the adjustments for fair values
identified subsequent to the acquisitions.
7. Disposal groups
The assets and liabilities relating to the VBHG Ltd group have been presented as
held for sale. A summary of the assets and liabilities is set out below:
+---------------------------+------------+-------------+
| | | 2009 |
+---------------------------+------------+-------------+
| | | GBP'000 |
+---------------------------+------------+-------------+
| | | |
+---------------------------+------------+-------------+
| Non-current assets | | |
+---------------------------+------------+-------------+
| Intangible assets | | 26,829 |
+---------------------------+------------+-------------+
| Property, plant and | | 3,100 |
| equipment | | |
+---------------------------+------------+-------------+
| Deferred tax assets | | 188 |
+---------------------------+------------+-------------+
| Trade and other | | 5,373 |
| receivables | | |
+---------------------------+------------+-------------+
| | | 35,490 |
+---------------------------+------------+-------------+
| Current assets | | |
+---------------------------+------------+-------------+
| Trade and other | | 12,055 |
| receivables | | |
+---------------------------+------------+-------------+
| | | |
+---------------------------+------------+-------------+
| Assets of disposal group | | 47,545 |
+---------------------------+------------+-------------+
| | | |
+---------------------------+------------+-------------+
| Current liabilities | | |
+---------------------------+------------+-------------+
| Trade and other payables | | (16,195) |
+---------------------------+------------+-------------+
| Current tax liabilities | | (27) |
+---------------------------+------------+-------------+
| Borrowings | | (1,246) |
+---------------------------+------------+-------------+
| | | (17,468) |
+---------------------------+------------+-------------+
| Non current liabilities | | |
+---------------------------+------------+-------------+
| Borrowings | | (871) |
+---------------------------+------------+-------------+
| Trade and other payables | | (6,276) |
+---------------------------+------------+-------------+
| Deferred tax liabilities | | (1,853) |
+---------------------------+------------+-------------+
| | | (9,000) |
+---------------------------+------------+-------------+
| | | |
+---------------------------+------------+-------------+
| Liabilities of disposal | | (26,468) |
| group | | |
+---------------------------+------------+-------------+
8. Called up share capital
+---------------------------------------+-------------+-------------+-------------+
| | Unaudited | Unaudited | Year ended |
| | 6 months | 6 months | 31 October |
| | ended 30 | ended 30 | 2008 |
| | April 2009 | April 2008 | GBP'000 |
| | GBP'000 | GBP'000 | |
+---------------------------------------+-------------+-------------+-------------+
| Authorised | | | |
+---------------------------------------+-------------+-------------+-------------+
| 50,000,000 ordinary shares of 10p | 5,000 | 5,000 | 5,000 |
| each | | | |
+---------------------------------------+-------------+-------------+-------------+
| | | | |
+---------------------------------------+-------------+-------------+-------------+
| Allotted, called up and fully paid | Number | Number | Number |
+---------------------------------------+-------------+-------------+-------------+
| Ordinary shares of 10p each | 39,516,955 | 39,516,955 | 39,516,955 |
+---------------------------------------+-------------+-------------+-------------+
| | | | |
+---------------------------------------+-------------+-------------+-------------+
| Allotted, called up and fully paid | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------------+-------------+-------------+-------------+
| Ordinary shares of 10p each | 3,952 | 3,952 | 3,952 |
+---------------------------------------+-------------+-------------+-------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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