3rd Quarter Results
Intec Telecom Systems PLC
23 August 2005
Intec Telecom Systems PLC
Unaudited results for the nine months ended 30 June 2005
Multi-million pound contract wins and acquired Singl.eView business drive
revenue up 63%; earnings increased substantially with EBITDA up 55%
London, 23 August 2005 ... Intec Telecom Systems PLC ("Intec" or "the Company"),
a leading supplier of business and operations support systems (BSS/OSS) to the
global telecoms industry, today announced its unaudited results for the nine
months ended 30 June 2005 ("9m 2005").
Revenue and earnings, in line with market expectations, are substantially ahead
of the same period last year, as a result of both the Singl.eView acquisition in
August 2004 and a growing contribution from large, multi-product transactions.
Continuing investment in product development, distribution channels and Intec's
professional services capability, backed by strong cost management, has
maintained sales momentum and delivery capability. Recent multi-million pound
contract wins, with high activity levels in new business development, underline
the continuing strength of the enlarged business.
Financial Highlights
• Revenue up 63% to £76.5m (9 months ended 30 June 2004 ("9m 2004"):
£46.9m).
• EBITDA before exceptionals up 55% to £8.5m (9m 2004: £5.5m).
• Services revenue up 121% to £30.4m (9m 2004: £13.8m).
• Adjusted PBT up 52% to £5.8m (9m 2004: £3.8m).
• Adjusted EPS up 12% to 1.61p (9m 2004: 1.44p).
• Loss before tax of (£7.7m) (9m 2004: (£2.2m)) after £12.3m
amortisation charge (9m 2004: £6.0m).
• Operating cash inflow of £3.8m (9m 2004: inflow of £0.1m).
• Net cash & equivalents of £28.4m (30-Jun-04: £12.8m).
Operational Highlights
• Increase in volume of multi-product and multi-million pound contracts.
• Notable competitive wins including VimpelCom, The Carphone Warehouse
and a major US operator.
• Increase in customer base to 715 installations within almost 500
customers (30-Jun-04: 585 installations with 409 companies).
• Continuing investment helps Intec retain technical leadership in core
product areas.
• New technical facility opened in Bangalore, India.
"Intec's staff and management team continues to execute very satisfactorily
against its business goals, within a global marketplace that remains highly
competitive," said Intec's non-executive Chairman, John Hughes. "The Singl.eView
acquisition, which was completed last year, has proved to be the
transformational transaction that was expected. We have successfully turned
around the business, and it continues to go from strength to strength. The
associated evolution to a primarily Percentage of Completion revenue recognition
model is being well managed. The Company, its staff and products are well
positioned to maximise the growth opportunities that lie ahead."
"The multi-product, multi-million pound contract wins we are achieving, and our
growing participation in leading-edge projects, indicate the continuing momentum
and potential of the business," added Intec CEO, Kevin Adams. "Intec has an
unmatched product range, a substantial and proven global delivery capability,
and a broad customer base. These are vital assets in our quest for continued
growth in the OSS/BSS market."
- e n d s -
Notes:
• A conference call for analysts will be held at 2.00pm on Tuesday 23 August
2005. Please contact Financial Dynamics for details.
• Digital images of the Intec executive directors can be downloaded from
www.vismedia.co.uk.
• These are the last full Q3 results issued by Intec. From next financial
year, as a result of new regulations affecting London listed companies, the
Company will issue half and full year results only.
• Investor website can be found at www.intecbilling.com
For more information, please contact:
Kevin Adams, Chief Executive Officer, Intec Telecom Systems PLC
Tel: +44 (0)1483 745800
Robert Gibb, Investor Relations Manager, Intec Telecom Systems PLC
Tel: +44 (0)1483 745941 or 745800; Mob: +44 (0)7876 656 896
Email: robert.gibb@intecbilling.com
James Melville-Ross/ Edward Bridges/ Cass Helstrip
Financial Dynamics
Tel: +44 (0)20 7831 3113; Email: intec@fd.com
Chairman's and CEO's Statement
Intec Telecom Systems PLC - Third Quarter, 2005
Overview
We are pleased to report considerably increased revenues for the first nine
months of 2005 ("9m 2005"), as a result of the successful acquisition and
integration of the Singl.eView business, and our ability to close new deals
across our broad product portfolio. Earnings have also risen strongly,
indicating our ability to control expenditure well during a period of rapid
expansion and development.
With the addition of Singl.eView to our world-class software, solutions and
services portfolio, the Company is well placed to benefit from new opportunities
in the telecoms billing market. Intec is now the world's third largest supplier
of business and operations support systems (BSS/OSS) (source: ABN AMRO) based on
licence sales, and the largest such supplier in EMEA.
The Intec business model continues to mature, due to a number of factors,
including a greater contribution from services; larger and longer contracts; and
a revenue recognition model biased increasingly towards a Percentage of
Completion (PoC) basis. While the immediate effect may be a lower revenue
recognition run-rate, the welcome longer term benefit is a more stable and
predictable business model.
Operational review
In the third quarter of 2005 ("Q3 2005"), Intec secured several important
contract wins. A multi-million dollar agreement for Singl.eView was announced in
April with a tier 1 US carrier, to manage the billing of its next-generation
services and reporting across its legacy billing platforms for strategic
business customers. This contract highlights a growing trend for operators to
consolidate multiple operational and billing systems to reduce costs and
increase customer service efficiencies. Singl.eView's convergent technology is a
very good fit for such projects.
Other multi-million pound contracts announced in the period included an
agreement for Singl.eView with The Carphone Warehouse, Europe's leading
independent mobile communications retailer; and VimpelCom, a leading provider in
Russia and Kazakhstan, for state of the art online and offline mediation across
its mobile network. This deployment will ultimately support one of the world's
largest mobile subscriber bases.
Intec remains strong in developing markets such as Africa. For example, in
Nigeria, where we are a dominant player in inter-carrier billing, a contract was
signed in April with Interconnect Clearinghouse Nigeria, which acts as a
clearing house for all telecommunications service providers in the country. The
clearing system handles inter-carrier billing between different organisations,
ensuring improved call completion rates and increased revenue for operators.
Several new installations successfully went live. Telecom New Zealand went into
production with a new prepaid mobile billing system based on Singl.eView and
Inter-mediatE. Bridge Mobile, an alliance encompassing eight leading Asia
Pacific mobile operators, with a combined subscriber base of 64 million, chose
InterconnecT v7 for a project, developed in partnership with LogicaCMG, that
will facilitate a regional mobile infrastructure and common service platform for
pre-paid subscribers.
Major initiatives have been launched internally that are focused on increased
efficiency in services delivery and increased level of standard functionality to
minimise customisation requirements. A newly opened technical facility in
Bangalore, India is a part of this process. Intec has already recruited almost
100 people, and this number is planned to reach 150 by the end of the year and
to double again in 2006. The majority of employees are technical staff and
software developers, supported by a small administration team.
Products
As a result of our continuing commitment to product development, important new
modules and functionality were released and significant programme milestones
achieved. For example, InterconnecT Content Partner Management, which allows
users to maximise the revenue potential of content-based services such as
on-line gaming and e- and m-commerce offering, was released and implemented in a
major tier 1 customer in the US. Similarly, the latest version of our
Singl.eView Customer Management product, an integrated CRM system which enables
an operator to capture information about their customers and efficiently manage
the data, was released and successfully incorporated into several customer
installations across Europe.
InterconnecT v7, the latest version of Intec's market leading inter-carrier
billing system, was selected by four new customers in the quarter and went into
production in Singapore. The solution was benchmarked with more than 1.6 billion
event data records (EDRs) processed correctly in an eight-hour test. This is
several times the current processing requirement of even the world's largest
carriers today. (An EDR can represent anything from a standard voice call to the
delivery of a sophisticated content-based event.) We also developed additional
functionality within our Optimal Routing (OR) trading platform solution, which
now consists of nine modules enabling operators to route network traffic in the
most cost effective way whilst achieving the appropriate quality of service
standards
Staff and infrastructure
At the end of Q3 2005, staff numbers globally stood at 1,505 (30-Jun-04: 713)
with 29 offices in 23 countries. Intec's global presence is important for a
number of reasons. By being located close to customers, Intec can provide strong
support backed by an understanding of local circumstances and market
opportunities, giving rise to potential for cross-selling and up-selling from
the extended Intec product portfolio.
Regional Headquarters are located in Woking, UK (Europe, Middle East & Africa
(EMEA)); Atlanta, USA (North America & Canada); Sao Paulo, Brazil (Caribbean &
Latin America (CALA)); and Kuala Lumpur, Malaysia (Asia Pacific). Additionally,
and operating globally, the Company has development centres in Cape Town, South
Africa; Brisbane, Australia; Roskilde, Denmark; and Bangalore, India.
Financial analysis
Total revenue increased by 63 per cent to £76.5 million (9m 2004: £46.9m)
primarily reflecting an increase due to Singl.eView, the retail billing business
acquired in Q4 2004.
As a result of this acquisition, as discussed at the half year results, several
important aspects of Intec's financial profile have changed. Firstly, revenue
recognition has evolved largely from 'milestones achieved' to be primarily
oriented to a Percentage of Completion (PoC) basis. As a result, less income is
recognised in the early stages of a contract period than previously. Secondly,
multi-million pound, multi-product contracts are being achieved regularly, a
trend that is expected to continue. Thirdly, customers often request further
software and services to be included in a contract once the benefits are seen,
yielding additional revenue and income to Intec. However, this can extend the
agreement period, lengthening the PoC time and therefore reducing revenue
recognised within a given quarter.
The combined effects of these changes mean that average contract sizes have
increased and carried forward revenues for future periods are greater.
In addition to these revenue recognition changes, Singl.eView generates greater
services business than was the case with the traditional Intec operating model.
Services revenue rose 121 per cent to £30.4 million (9m 2004: £13.8 million)
despite the exclusion of some non-recurring items such as hardware contracts.
Implementation and consulting alone increased by 154 per cent. Services now
account for 40 per cent of revenue compared with 29 per cent previously.
Recurring revenues, which includes maintenance fees and licence upgrades, grew
by 52 per cent to £32.5 million (9m 2004: £21.3 million). Licence sales
increased by 15 per cent to £13.6 million (9m 2004: £11.8 million).
Asia Pacific had a particularly strong period, with its revenue rising 107 per
cent to £11.5 million (9m 2004: £5.6 million), as a result of both acquired
Singl.eView business and several key wins. Revenue also increased in North
America & Canada by 72 per cent to £24.0 million (9m 2004: £14.0 million) and in
EMEA by 66 per cent to £36.2 million (9m 2004: 21.9 million), including a 119
per cent increase from Continental Europe within the latter region. Turnover in
CALA fell 14 per cent to £4.8 million (9m 2004: £5.5 million) reflecting the
strong year it had in 2004, and the absence of any newly acquired Singl.eView
business in this region.
EBITDA before exceptionals rose 55 per cent to £8.5 million (9m 2004: £5.5
million); EBITA was up 41 per cent to £5.2 million (9m 2004: £3.7 million) and
adjusted profit before tax increased 53 per cent to £5.8 million (9m 2004: £3.8
million). The loss before tax of (£7.7 million) (9m 2004: loss of (£2.2
million)) reflects the increased goodwill amortisation charge of £12.3 million
(9m 2004: £6.0 million) following the Singl.eView acquisition.
Gross margin for the nine months was 63 per cent (9m 2004: 71 per cent),
reflecting the change to a higher proportion of professional services over
licence fees consequent on major implementation projects. Intec has a number of
internal programmes aimed at delivering higher gross margin over time.
Adjusted earning per share rose 12 per cent to 1.61p (9m 2004: 1.44p) and basic
loss per share was (2.88p) (9m 2004: (1.45p)).
Quarterly reporting
Following new legislation in July 2005, affecting all companies listed on the
London Stock Exchange, Intec is no longer obliged to report quarterly. As a
result, these Q3 results will be the last ones issued in this format. From next
financial year we will announce half and full year results only, including full
reports and financial statements to all shareholders.
This change also signals the evolution of Intec into a larger, more mature and
stable company and six monthly reporting periods will reflect, more
appropriately, the longer sales cycles in our business.
Outlook
Intec is winning substantial, multi-product deals with major customers around
the world, and we are investing in the staff, capabilities and infrastructure
needed to continue growing the business. The transformation of the Singl.eView
business into a profitable operation has been successfully achieved, and we look
forward to sustained success in both this and the core Intec business. Although
the final quarter of the year has a substantial revenue and earnings target,
provided market conditions remain stable, our current revenue visibility and
order pipeline allow us to be confident of meeting expectations for the full
year. In addition, the success we are experiencing in 2005 provides a solid
foundation for future growth in the business.
John Hughes, Non-executive Chairman
Kevin Adams, Chief Executive Officer
22 August 2005
Intec Telecom Systems PLC
Unaudited results for the nine months ended 30 June 2005
FINANCIAL HIGHLIGHTS
Nine months ended 30 June 2005
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
Note 30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
TURNOVER 76,464 46,921 68,828
Adjusted profit before tax (i) 5,762 3,786 8,277
EBITDA before exceptional items (ii) 8,465 5,485 10,667
FRS 3 Operating loss (8,260) (2,317) (1,369)
Basic loss per share (2.88) p (1.45) p (0.80) p
Adjusted earnings per share (iii) 1.61 p 1.44 p 3.57 p
Notes to the Financial Highlights: Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
(i) Loss before tax (7,719) (2,214) (1,187)
Amortisation of goodwill and other intangibles 12,270 6,000 8,762
Exceptional items 1,211 - 702
Adjusted profit before tax 5,762 3,786 8,277
(ii) Adjusted profit before tax 5,762 3,786 8,277
Net interest income (541) (103) (182)
Depreciation 3,244 1,801 2,572
EBITDA before exceptional items 8,465 5,485 10,667
(iii) Adjusted earnings per share calculation based
on the following adjusted earnings after tax:
Loss after tax (8,646) (3,009) (1,737)
Amortisation of goodwill and other intangible assets 12,270 6,000 8,762
Exceptional items 1,211 - 702
Adjusted earnings after tax 4,835 2,991 7,727
KEY CUSTOMER DATA
30 June 30 September 30 June
2005 2004 2004
Number Number Number
Cumulative:
Contracted customer base 490 465 409
Contracted customers from acquisitions 5 - -
495 465 409
Contracted installations 708 668 585
Contracted installations from acquisitions 7 - -
715 668 585
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Nine months ended 30 June 2005
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
Note 30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
TURNOVER 2 76,464 46,921 68,828
Cost of sales (28,590) (13,534) (19,550)
GROSS PROFIT 47,874 33,387 49,278
Distribution costs (13,457) (8,659) (13,068)
Administrative expenses:
Development expenditure (11,634) (8,855) (11,494)
Amortisation of goodwill and other
intangible assets (12,270) (6,000) (8,762)
Exceptional expenses (1,211) - (702)
Other administrative expenses (17,562) (12,190) (16,621)
Total administrative expenses (42,677) (27,045) (37,579)
GROUP OPERATING LOSS (8,260) (2,317) (1,369)
Interest receivable and similar income 671 166 287
Interest payable and similar charges (130) (63) (105)
LOSS ON ORDINARY ACTIVITIES
BEFORE TAXATION (7,719) (2,214) (1,187)
Tax charge on loss on ordinary activities 3 (927) (795) (550)
RETAINED LOSS ON ORDINARY
ACTIVITIES AFTER TAXATION (8,646) (3,009) (1,737)
Loss per share - basic 4 (2.88) p (1.45) p (0.80) p
Earnings per share - adjusted 4 1.61 p 1.44 p 3.57 p
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
Nine months ended 30 June 2005
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Loss for the period (8,646) (3,009) (1,737)
Exchange translation differences arising on
foreign currency net investments 45 (786) (868)
Total recognised losses during the period (8,601) (3,795) (2,605)
CONSOLIDATED BALANCE SHEET
30 June 2005
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
Note 30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
FIXED ASSETS
Intangible assets 92,765 63,110 103,459
Tangible assets 8,004 3,943 7,530
Investments 5 5 6
100,774 67,058 110,995
CURRENT ASSETS
Debtors 5 44,108 26,848 40,634
Investments 4,573 5,352 3,966
Cash at bank and in hand 26,197 7,565 28,216
74,878 39,765 72,816
CREDITORS: amounts falling due within one year 6 (7,297) (7,049) (8,962)
NET CURRENT ASSETS 67,581 32,716 63,854
TOTAL ASSETS LESS CURRENT LIABILITIES 168,355 99,774 174,849
CREDITORS: amounts falling due after
more than one year 7 (2,748) (85) (2,817)
PROVISIONS FOR LIABILITIES AND CHARGES 8 (3,028) (2,248) (3,403)
ACCRUALS AND DEFERRED INCOME 9 (28,649) (11,379) (26,399)
TOTAL NET ASSETS 133,930 86,062 142,230
CAPITAL AND RESERVES
Called up share capital 10 3,017 2,078 2,998
Share premium account 10 160,744 106,405 160,462
Merger reserve 10 6,768 6,768 6,768
Own shares 10 (95) (96) (95)
Foreign exchange reserve 10 (1,809) (1,772) (1,854)
Profit and loss account 10 (34,695) (27,321) (26,049)
EQUITY SHAREHOLDERS' FUNDS 133,930 86,062 142,230
RECONCILIATION OF MOVEMENT IN CONSOLIDATED SHAREHOLDERS' FUNDS
Nine months ended 30 June 2005
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Loss for the financial period (8,646) (3,009) (1,737)
Other recognised losses relating to the period 45 (786) (868)
Issue of share capital net of associated expenses 301 681 55,316
Decrease in contingent consideration - (236) (236)
Increase in own shares - (342) -
(Decrease)/increase in shareholders' funds (8,300) (3,692) 52,475
Opening shareholders' funds 142,230 89,754 89,755
Closing shareholders' funds 133,930 86,062 142,230
CONSOLIDATED CASH FLOW STATEMENT
Nine months ended 30 June 2005
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Net cash inflow/(outflow) from
operating activities (i) 3,769 144 4,595
Returns on investments and servicing of finance
Interest received 671 166 288
Interest element of finance lease rental payments (6) (21) (83)
Interest paid and similar items (85) (42) (23)
580 103 182
Taxation
Overseas taxation paid (915) (592) (1,123)
Capital investment
Payments to acquire tangible fixed assets (3,748) (1,463) (2,367)
Proceeds on disposal of fixed assets 55 - -
(3,693) (1,463) (2,367)
Acquisitions
Investment in subsidiaries (929) (107) (42,567)
Net cash acquired with subsidiaries 75 - 1,354
(854) (107) (41,213)
Cash inflow/(outflow) before management of liquid
resources and financing
(1,113) (1,915) (39,926)
Use of liquid resources
Decrease in cash investments/term deposits (567) 282 1,652
Financing
Issue of ordinary share capital 301 106 56,840
Share issues costs charged to the
share premium account - (5) (1,760)
Loan - - 2,223
Capital element of finance lease rental payments (114) - (152)
Increase in cash in the period (ii),(iii) (1,493) (1,637) 18,877
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
Nine months ended 30 June 2005
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
(i) Reconciliation of operating loss to net cash
inflow/(outflow) from operating activities
Operating loss (8,260) (2,317) (1,369)
Depreciation 3,244 1,801 2,572
Amortisation of goodwill and other intangible assets 12,270 6,000 8,762
(Gain)/loss on disposal of fixed assets (11) 6 45
(Increase)/decrease in stock - 1 -
Decrease in debtors (1,583) (5,532) (6,300)
(Increase)/decrease in creditors (1,891) 185 885
Net cash inflow/(outflow) from operating activities 3,769 144 4,595
(ii) Reconciliation of net cash flow to
movement in net funds
Increase/(decrease) in cash in the period (1,493) (1,637) 18,877
Net cash outflow/(inflow) from decrease/(increase) in
debt and lease financing 114 105 (2,071)
Net cash inflow from decrease in liquid resources 567 (282) (1,652)
Change in net funds resulting from cash flows (812) (1,814) 15,154
New finance leases - - (201)
Translation differences (486) (499) (383)
Movement in net funds (1,298) (2,313) 14,570
Net funds at 1 October 29,700 15,130 15,130
Net funds at 30 June / 30 September 28,402 12,817 29,700
(iii) Analysis of movement in net funds
Audited Unaudited
1 October Exchange 30 June
2004 Cash flow movement 2005
£000 £000 £000 £000
Cash in hand and at bank 28,216 (1,493) (526) 26,197
Debt due after one year (2,223) - - (2,223)
Finance leases (259) 114 - (145)
Term deposits 3,966 567 40 4,573
29,700 (812) (486) 28,402
NOTES TO THE UNAUDITED INTERIM FINANCIAL INFORMATION
Nine months ended 30 June 2005
1. BASIS OF PREPARATION
The interim financial information has been prepared in accordance with
accounting policies set out in, and consistent with, the Group's 2004 financial
statements except for the taxation charge for the period which is based on the
estimated charge for the year ending 30 September 2005.
The interim financial information is neither reviewed nor audited and does not
comprise statutory accounts for the purposes of Section 240 of the Companies Act
1985.
The abridged information for the year ended 30 September 2004 has been extracted
from the Group's statutory accounts for that period, which have been filed with
the Registrar of Companies following the 2005 Annual General Meeting. The
Auditor's report on the statutory accounts of the Group for that period was
unqualified and did not contain a Statement under either Section 237(2) or
Section 237(3) of the Companies Act 1985.
The interim financial information was approved by the Board of Directors on 22
August 2005.
2. TURNOVER AND SEGMENTAL REPORTING
Turnover by origin Unaudited Unaudited
Nine months ended 30 June 2005 Nine months ended 30 June 2004
Inter- Inter-
Total segment External Total segment External
turnover turnover turnover turnover turnover turnover
£000 £000 £000 £000 £000 £000
United Kingdom 17,801 (19) 17,782 22,315 (322) 21,993
Continental Europe 21,230 (2,400) 18,830 3,267 - 3,267
Africa 2,214 - 2,214 131 - 131
Asia-Pacific 6,039 - 6,039 1,519 - 1,519
North America and Canada 31,644 (2,245) 29,399 20,195 (1,658) 18,537
Central and Latin America 2,200 - 2,200 1,474 - 1,474
81,128 (4,664) 76,464 48,901 (1,980) 46,921
Audited Year ended 30 September 2004
Inter-
Total segment External
Turnover turnover turnover
£000 £000 £000
United Kingdom 32,670 (1,849) 30,821
Continental Europe 5,889 - 5,889
Africa 266 - 266
Asia-Pacific 2,126 - 2,126
North America and Canada 29,600 (1,964) 27,636
Central and Latin America 2,090 - 2,090
72,641 (3,813) 68,828
Turnover by destination Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
United Kingdom 6,298 4,989 7,280
Continental Europe 19,263 8,790 11,030
Eastern Europe 2,106 2,868 4,599
Middle East 805 441 633
Africa 7,715 4,767 7,451
Europe, Middle East and Africa (EMEA) 36,187 21,855 30,993
Asia-Pacific 11,513 5,568 9,090
North America and Canada 23,982 13,959 20,756
Central and Latin America 4,782 5,539 7,989
Total turnover by destination 76,464 46,921 68,828
Turnover by activity Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Licence sales 13,587 11,815 19,123
Professional services income:
Implementation and migrations,
consulting and training 30,188 11,886 17,499
Hardware 196 466 466
Non-telecom custom network solutions - 1,410 1,651
30,384 13,762 19,616
Recurring income:
ASP Service 5,625 2,942 4,337
Volume upgrade licences 3,923 3,377 4,320
Support and maintenance fees 22.945 15,025 21,432
32,493 21,344 30,089
Total turnover by activity 76,464 46,921 68,828
Unaudited Nine months ended 30 June 2005
Profit/(loss) before tax
Before Exceptional
amortisation Amortisation of Administrative After amortisation
of goodwill goodwill expense of goodwill
£000 £000 £000 £000
United Kingdom 699 (758) (557) (616)
Continental Europe 5,460 (8,131) (334) (3,005)
Asia-Pacific (40) - - (40)
Africa (283) - (155) (438)
North America
and Canada (194) (3,381) (165) (3,740)
Central and
Latin America 120 - - 120
5,762 12,270 (1,211) (7,719)
Unaudited Nine months ended 30 June 2004
Profit/(loss) before tax
Before Exceptional
amortisation Amortisation of Administrative After amortisation
of goodwill goodwill expense of goodwill
£000 £000 £000 £000
United Kingdom (131) (1,150) - (1,281)
Continental Europe (1,583) (1,467) - (3,050)
Asia-Pacific 197 - - 197
Africa - - - -
North America & Canada 5,421 (3,383) - 2,038
Central and
Latin America (118) - - (118)
3,786 (6,000) - (2,214)
Audited Year ended 30 September 2004
Profit/(loss) before tax
Before Exceptional
amortisation Amortisation of Administrative After amortisation
of goodwill goodwill expense of goodwill
£000 £000 £000 £000
United Kingdom 1,263 (1,402) (455) (594)
Continental Europe (363) (2,849) (247) (3,459)
Asia-Pacific 55 - - 55
Africa 240 - - 240
North America
and Canada 7,216 (4,511) - 2,705
Central and
Latin America (134) - - (134)
8,277 (8,762) (702) (1,187)
Net assets/(liabilities) by
origin
Unaudited Unaudited Unaudited Unaudited Audited
30 June 30 June 30 June 30 June 30 September
2005 2005 2005 2004 2004
Excluding Including Including Including
Unamortised Unamortised Unamortised Unamortised unamortised
goodwill goodwill goodwill goodwill goodwill
£000 £000 £000 £000 £000
United Kingdom 9,030 1,206 10,236 10,593 24,293
Continental Europe 16,280 43,423 59,703 10,216 54,793
Africa 1,613 - 1,613 (340) 208
Asia-Pacific 965 - 965 105 (5)
North America
and Canada 13,512 47,231 60,743 64,902 62,395
Central and Latin America 670 - 670 586 546
42,070 91,860 133,930 86,062 142,230
3. TAX CHARGE ON LOSS ON ORDINARY ACTIVITIES
Unaudited Unaudited Audited
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Current taxation:
UK corporation tax at 30% (2004: 30%) - - -
Overseas taxation 927 787 875
Prior year - 8 (305)
Total current tax 927 795 570
Deferred taxation:
Origination and reversal of timing differences - - (20)
Tax on loss on ordinary activities 927 795 550
4. (LOSS)/EARNINGS PER ORDINARY SHARE
Unaudited Unaudited
Nine months Nine months Audited
ended ended Year ended
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Basic loss (8,646) (3,009) (1,737)
Amortisation of goodwill and intangible assets 12,270 6,000 8,762
Exceptional items 1,211 - 702
Adjusted earnings 4,835 2,991 7,727
Number Number Number
Weighted average number of shares 300,338,705 207,595,695 216,147,912
Pence Pence Pence
Basic loss per ordinary share (2.88) (1.45) (0.80)
Amortisation of goodwill and intangible assets 4.00 2.89 4.05
Exceptional items 0.40 - 0.32
Adjusted earnings per ordinary share 1.61 1.44 3.57
Diluted loss/earnings per share is not presented in respect of outstanding share
options since none of the options are dilutive.
5. DEBTORS
Unaudited Unaudited Audited
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Trade debtors 21,340 14,607 22,532
Corporation tax recoverable 124 196 353
Overseas tax recoverable 5 79 42
Deferred tax 252 253 266
Other debtors 610 64 1,304
Prepayments and accrued income:
Prepayments due within one year 5,383 2,421 4,076
Prepayments due after more than one year 636 564 583
Accrued income due within one year 15,758 8,664 11,478
44,108 26,848 40,634
6. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Unaudited Unaudited Audited
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Obligations under finance leases 64 100 128
Trade creditors 1,925 3,015 4,946
Corporation tax 686 1,147 915
Overseas tax 86 152 103
Other creditors including taxation and social security 3,464 2,635 2,870
Deferred consideration 1,072 - -
7,297 7,049 8,962
7. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Unaudited Unaudited Audited
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Loan 2,223 - 2,223
Obligations under finance leases 81 85 131
Other creditors 444 - 463
2,748 85 2,817
8. PROVISIONS FOR LIABILITIES AND CHARGES
Unaudited Unaudited Audited
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Onerous lease commitments 1,538 1,731 2,223
Lease incentives 597 517 607
Other provisions 893 - 573
3,028 2,248 3,403
Onerous lease commitments disclosed above relate to future estimated losses on
sub-let or vacant lease commitments acquired with the Digiquant and Singl.eView
businesses. Amounts provided relate to the period up to the first option to
break on a property in Denmark and properties acquired with the Singl.eView
acquisition. The first option to break for the Denmark property is in 2011 and
accordingly the provision above includes the discounted fair value of the future
losses up to this point.
Lease incentives are in respect of rent free periods on certain properties
leased within the group. The provision is expected to be utilised over the life
of the lease which expires in 2014. The comparatives for the year ended 30
September 2004 have been reclassified to enable a consistent comparison with the
current quarter.
Other provisions disclosed above relate to future estimated costs to complete
certain ongoing legal matters in respect of Singl.eView, a potential repayment
of a grant previously received by Singl.eView and the costs of completing
certain onerous fixed price implementation contracts. These provisions are
expected to be utilised within one year.
9. ACCRUALS AND DEFERRED INCOME
Unaudited Unaudited Audited
30 June 30 June 30 September
2005 2004 2004
£000 £000 £000
Amounts falling due within one year
Accruals 8,878 4,524 8,939
Deferred income 19,771 6,855 17,460
28,649 11,379 26,399
10. STATEMENT OF MOVEMENTS ON RESERVES
Called Share Foreign Profit
up share premium Merger Own exchange and loss
capital account reserve shares reserve account Total
£000 £000 £000 £000 £000 £000 £000
At 1 October 2004 2,998 160,462 6,768 (95) (1,854) (26,049) 142,230
Issue of shares 19 282 - - - - 301
Retained loss - - - - - (8,646) (8,646)
Foreign exchange translation - - - - 45 - 45
At 30 June 2005 3,017 160,744 6,768 (95) (1,809) (34,695) 133,930
END
This information is provided by RNS
The company news service from the London Stock Exchange
Monday, 13th May 2024
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