Interim Results - Pre-tax Profits Up 23%

Comino PLC 25 November 1999 COMINO plc INTERIM RESULTS ANNOUNCEMENT PBT up 23%; Dividend up 24% Disposal for £3.85m of Prologic subsidiary to generate £2.5m profit Comino plc ('Comino'), the provider of computer systems for occupational pensions, housing and local authority revenues & benefits, announces Interim Results for the six months ended 30 September 1999. Highlights of the interim results: Sep 1999 Sep 1998 Increase * Turnover £11.04m £8.72m 27% * Profit before tax £1.56m £1.27m 23% * Earnings per share - full tax 8.02p 7.24p 11% charge for the first time * Dividend 1.55p 1.25p 24% * Cash balances £6.81m £5.86m 16% * Disposal of Prologic subsidiary, which sells fashion and clothing systems, to generate profit of £2.5m * Anticipated group trading profit not expected to change materially as a result of transaction * Comino now focused on core business of providing systems for occupational pensions, housing and local authority revenues & benefits * Two remaining subsidiaries, Context and ISE, will now converge into a unified Comino model and this will allow performance to be reported more clearly on a divisional basis by sector * ISE gains 5 Local Authority Revenue sites in September, wins 4th call- centre from existing housing customer * Context customer service demand at a high level * Comino admitted to Official List from AIM in July 1999. The Company made the following comments on its results: 'These results are on target with market expectations and reflect solid performance. Comino starts the second half with balanced order books for customer services, support and new installations and is in a strong position as the millennium period begins to close. Our staff have successfully tackled Y2K compliance issues alongside an ambitious development programme whilst maintaining customer support and service delivery. Comino is well balanced to complete the year and well positioned to take advantage of future opportunities.' For further information please contact: Garth Selvey, Chief Executive tel: 0171 786 9600 until 12:30pm on the day Paul Clifford, Finance Director thereafter: 01628 525 433 Interim Statement ------------------------------------------------------------------------------ These results are on target with market expectations and reflect solid performance. Comino is well balanced to complete the year and well positioned to take advantage of future opportunities. ------------------------------------------------------------------------------ Comino is pleased to report a profit before tax for the half year to 30 September 1999 of £1.56m, an increase of 23% on the same period last year. Turnover increased by 27%. EPS suffered a full tax charge (1998 - 24%) for the first time and increased more slowly at 11%. Cash rose to £6.81m up 16% on the same period last year and the interim dividend increased by 24% to 1.55 pence per share. Comino was admitted to the Official List of the London Stock Exchange on 19 July of this year. Prologic which has been recognised for some time as a non-core activity was the subject of a buyout by its management. The sale will generate a profit on disposal of £2.5m and cash after tax of £2.8m. The level of anticipated group trading profit will not be materially altered as a result of this transaction. We thank Prologic management and staff for their contribution to the Comino Group and wish them success in their new venture. Comino is now focused entirely on its 'Business to Public' model and provides computer systems for Occupational Pensions, Housing and Local Authority Revenue administration. Context and ISE will now converge into a unified Comino model and this will allow performance to be reported more clearly on a divisional basis by sector. Gordon Skinner, the Chairman, was regrettably forced to retire though ill health in October of this year and the Board wishes to thank him for his very considerable contribution. David Quysner has taken the Chair on a temporary basis pending the appointment of a new Chairman. Throughout the period, ISE has maintained its normal pattern of trading and in particular gained five Local Authority Revenue sites in September. ISE has also won its fourth call-centre sale from an existing Housing customer. Context countered the expected Y2K new business downturn with an increase in service delivery and service demand from the customer base remains at a high level. Comino starts the second half with balanced order books for customer services, support and new installations and is in a strong position as the millennium period begins to close. Our staff have successfully tackled Y2K compliance issues alongside an ambitious development programme whilst maintaining customer support and service delivery. We thank staff and customers alike for their continued hard work and support. Consolidated Profit and Loss Account 6 months to 6 months to Year to 30 September 30 September 31 March 1999 1998 1999 £'000 £'000 £'000 Turnover 11,036 8,721 18,595 Cost of sales (3,650) (2,620) (5,784) ------------ ------------ ------------ Gross profit 7,386 6,101 12,811 Administrative expenses (5,978) (4,981) (10,377) ------------ ------------ ----------- Operating profit 1,408 1,120 2,434 Net interest receivable 154 146 284 ------------ ----------- ---------- Profit on ordinary activities before taxation 1,562 1,266 2,718 Tax on profit on ordinary activities (Note 1) (473) (303) (676) ------------ ----------- ---------- Profit on ordinary activities after taxation 1,089 963 2,042 Dividend proposed (212) (175) (513) ----------- ---------- ---------- Retained profit for the period 877 788 1,529 ====== ===== ===== Earnings per share (Note 2) 8.02p 7.24p 15.21p ====== ===== ===== Diluted earnings per share 7.79p 6.97p 14.83p ====== ===== ===== Dividend per share 1.55p 1.25p 3.75p ====== ===== ===== The dividend of 1.55 pence per share will be paid on 27 January 2000. The dividend record date is 10 December 1999. Consolidated Balance Sheet 30 September 30 September 31 March 1999 1998 1999 £'000 £'000 £'000 Tangible fixed assets 829 692 649 Current assets Stocks 911 376 859 Debtors 4,298 4,108 6,596 Cash at bank and in hand 6,809 5,859 7,449 ----------- ----------- ----------- 12,018 10,343 14,904 Creditors falling due within one year (4,109) (3,877) (5,678) ----------- ----------- ----------- Net current assets 7,909 6,466 9,226 ----------- ----------- ----------- Total assets less current liabilities 8,738 7,158 9,875 Creditors falling due after more than one year (515) (381) (55) Deferred income (4,065) (4,243) (6,545) ------------ ------------ ----------- 4,158 2,534 3,275 ======= ======= ====== Capital and reserves Share capital 682 678 678 Share premium account 4,335 4,334 4,334 Profit and loss account (859) (2,478) (1,737) ----------- ----------- ----------- Shareholders' funds 4,158 2,534 3,275 ====== ====== ====== Consolidated Cash Flow Statement 6 months to 6 months to Year to 30 September 30 September 31 March 1999 1998 1999 £'000 £'000 £'000 Net cash inflow/(outflow) from operating activities (72) 1,918 4,134 Net returns on investments and servicing of finance Interest received 154 146 284 ----------- ----------- ----------- 154 146 284 ----------- ----------- ----------- Tax paid 0 0 (451) Capital expenditure Purchase of tangible fixed assets (356) (188) (341) Sale of tangible fixed assets 0 21 29 ----------- ----------- ----------- Net cash outflow from capital expenditure (356) (167) (312) ------------ ------------ ------------ Equity dividends paid (339) (334) (502) Financing Issue of shares (net of costs) 6 31 31 Repayment of borrowings (33) (64) (64) ----------- ----------- ----------- Net cash inflow/(outflow) from financing (27) (33) (33) ----------- ----------- ----------- Management of liquid resources Increase in short term deposits 0 (1,800) 2,200 ----------- ----------- ----------- Increase/(decrease) in cash (640) (270) 5,320 ====== ====== ====== Notes to the Interim Accounts 1. The charge for taxation is based on the expected rate for the financial year. 2. The calculation of earnings per share for the six months ended 30 September 1999 is based on the profit for the financial period of £1,089,000 (1998 - £963,000) and on 13,571,975 (1998 - 13,291,187) ordinary shares being the average number of shares in issue during the period. 3. The interim statement, which has been prepared on the same accounting basis as those set out in the financial statements for the year ended 31 March 1999, was approved by the Board on 24 November 1999. The foregoing financial information does not represent full accounts within S240 of the Companies Act 1985 and has not been reported on by the auditors or delivered to the Registrar of Companies. 4. The above results for the year ended 31 March 1999 have been abridged from the full Group accounts for that year, which received an unqualified auditors' report and which have been delivered to the Registrar of Companies. Independent Review Report to Comino plc Introduction We have been instructed by the company to review the interim financial information set out on pages 3 to 5 and we have read the other information contained in the interim report and considered whether it contains any apparent mis-statements or material inconsistencies with the financial information. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by the directors. The Listing Rules of the London Stock Exchange require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance in Bulletin 1999/4 'Review of Interim Financial Information' issued by the Auditing Practices Board. A review consists principally of making enquiries of management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whether accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of control and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with Auditing Standards and therefore provides a lower level of assurance than audit. Accordingly, we do not express an opinion on the interim financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the interim financial information as presented for the six months ended 30 September 1999. Grant Thornton Chartered Accountants London 24 November 1999

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