Interim Results
ITIS Holdings PLC
15 November 2000
Date: Wednesday 15th November 2000
Contact: Stuart Marks, Chief Executive
ITIS Holdings plc
Telephone: 0207 282 2945 until 3pm
Thereafter: 0161 927 3604
Ginny Pulbrook, Director
Citigate Dewe Rogerson
Telephone: 0207 282 2945
ITIS Holdings plc
2000 Interim Results
Expectations in line; New Strategic Partnerships agreed
ITIS Holdings plc ('ITIS') today announces its Interim Results for the six
months ended 30th September 2000
ITIS is a location-based content and service provider to the fast growing
telematics industry.
Highlights
* This October the Group successfully listed on the Alternative Investment
Market ('AIM') in London raising £27.65m net of expenses;
* Maiden results in line with expectations
* Turnover up 28.2 % to £311,000
* Operating loss of £3,487,000 reflecting launch of subsidised NavTrak
hardware and new driver services;
* Launch of NavTrak and development of services well under way;
* Continued expansion of franchised dealership groups: Inchcape plc,
Sytner Group plc, Snows and Trinity Motors;
* First OEM relationship with Massey Ferguson;
* Strategic partnerships enabling penetration into new markets;
* Increased subscriber numbers, coupled with value-added services.
Commenting on the results, Stuart Marks, Chief Executive of ITIS Holdings plc
commented:
'In this first set of public results ITIS has achieved good progress. Our
focus for the remainder of the year will be to further penetrate the high
growth telematics market. The Company has a strong and well-balanced
management team and a strong financial position. These features make the
outlook for both the existing NavTrak services and for new projects very
promising.'
Extracts from the Chairman & Chief Executive's Statement:
'We are delighted to report these maiden interim results for the six month
period to 30th September. ITIS Holdings plc has established itself as one of
the fastest growing telematics service providers in Europe, offering a vehicle
tracking and recovery service, roadside assistance, navigation and concierge
services through its NavTrak system.
We were extremely pleased with the interest shown in our business during the
flotation process and by the investment community's recognition of the
exciting growth story that the telematics industry offers: industry analysts
predict the market for telematics services to grow from US$1billion to US$43bn
in 2004.
In spite of it being only one month since the listing, we have made excellent
progress in pursuing the strategy of growing our relationships with vehicle
manufacturers, working with our strategic partners and launching the
subsidised NavTrak system as well as developing an innovative range of
value-added driver services.
The Company operates two subsidiaries: ITIS creates and aggregates content for
corporate customers; NavTrak is a provider of location based services to
drivers. Minorplanet's in-vehicle technology as used by NavTrak, GE Capital
Fleet Services and Minorplanet's own customers, will provide a rich source of
Floating Vehicle Data to the Group.
Financial Results:
The results for the six month period ended 30th September 2000 are very much
in line with expectations. Turnover for the period increased by 28.2% to £
311,000. The loss for the financial period of £3,486,000 fully reflects the
Group's gearing up for the launch of the subsidised NavTrak hardware and the
new driver services.
ITIS's cash balances remain healthy. As at 30th September 2000 they totalled £
3,987,000 which is stated prior to receiving the net float monies of £
27,650,000 during October 2000. The cash outflow before financing over the six
months was £4,630,000.
Review of Business:
At the time of our flotation we outlined our strategy for developing the
business, namely:-
* to stimulate subscriber numbers for the services by the subsidy of the
NavTrak hardware:
The Group is in the process of converting its dealership customers to a
subsidised hardware model. Initial reactions are positive both from
dealers and customers, and we believe that this strategy will enable
greater penetration of NavTrak units and therefore increase the
opportunities to sell additional services.
* to recruit new dealer groups, hence encouraging the motor dealers to
install NavTrak's services into their fleet vehicles:
In addition to our existing good relationships with well known automotive
dealers such as HROwen, Lancaster Group and Hartwell, we are pleased to
announce the recruitment of a number of new franchised dealership groups
including Inchcape plc, Sytner Group plc, Snows and Trinity Motors which
gives ITIS a total of 238 dealer outlets in the UK. The Group has an
ongoing dealer recruitment programme and is confident that it will result
in significant penetration of the new car market.
Marketing Agreements
NavTrak has been selected by 4car.co.uk as one of their product partners
and NavTrak will feature prominently on the site, which is currently the
most visited car related web site and is associated with the Channel 4
programme 'Driven'.
* to build on existing strong relationships with vehicle manufacturers:
The Group is committed to gaining further penetration of the markets
within which it operates and is continuing to develop relationships with
vehicle manufacturers. We are pleased to announce an agreement with AGCO,
the UK distributor of Massey Ferguson. Under this agreement, AGCO will
promote NavTrak as its approved security product for Massey Ferguson
tractors as well as other vehicles sold, including cars, through its
network of 128 dealers.
* to develop innovative value-added services:
Within the next few weeks, and once all the dealerships are converted to
the subsidised model, we will be launching a range of driver services.
These include TrafficWatch, a proactive traffic advisory system which
tracks the driver's progress along the route stated at the beginning of
the journey and JourneyDiary, an electronic log of trips which enables
easy calculation of business and personal mileage for the driver. Services
will be billed to the customer's credit card in a combination of
subscription and pay on use services in accordance with our policy to
simplify customer and dealership administration.
* to build on opportunities with strategic partners:
As stated at the time of our listing we recognise the importance of
strategic partnerships and are continuing to support GE Capital Fleet
Services with their Fleet Command programme as well as working closely
with them to launch the NavTrak services to their customers.
Aon Risk Services will be installing NavTrak on all of their company
vehicles in the UK as the first stage of a larger roll out to the rest of
their customer base.
As part of the new agreement signed with Minorplanet earlier this year,
both companies have been working closely together to identify new business
opportunities. We have identified targets suitable for Floating Vehicle
Data and have agreed a pilot scheme in conjunction with Minorplanet's
customer base.
During the period the Company signed an agreement with Yeoman Group to
engage in technical co-operation in a number of areas where the parties
share complementary skills. The Yeoman Group owns key technologies for
delivering position, direction and navigation services through portable
platforms such as mobile phones.
Prospects:
In-vehicle telematics for drivers using GPS and GSM have traditionally
been limited to stolen vehicle recovery, emergency and breakdown services.
The Group's strategy is to provide services that can be used on an
everyday basis not simply in the event of distress. Our unique approach of
subsidising hardware and dealership support will enable the Group to
increase subscriber numbers and provide a solid platform from which to
develop revenues.
Over the past six months the Group has established a platform for growth
by investing in its distribution network, its systems and its people.
During the next six months further services will come on stream and ITIS
will further benefit from its relationships with its strategic partners.'
Consolidated profit and loss account
Six months to Six months to Year ended
30 September 30 September 31 March
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Turnover 310,656 242,263 429,549
Cost of sales (666,877) (772,497) (1,165,168)
__________ __________ __________
Gross loss (356,221) (530,234) (735,619)
Other operating costs (3,125,603) (1,502,070) (3,915,975)
__________ __________ __________
Operating loss (3,481,824) (2,032,304) (4,651,594)
Interest receivable 94,456 1,805 28,675
Interest payable and similar (9,402) (2,931) (21,297)
charges
__________ __________ __________
Loss on ordinary activities (3,396,770) (2,033,430) (4,644,216)
before taxation
Tax on loss on ordinary - - -
activities
__________ __________ __________
Loss on ordinary activities after (3,396,770) (2,033,430) (4,644,216)
taxation
Dividends on non-equity shares (89,781) - (52,795)
__________ __________ __________
Loss for the financial period (3,486,551) (2,033,430) (4,697,011)
__________ __________ __________
Loss per ordinary share (p) (6.8) (4.4) (10.1)
__________ __________ __________
All activity has arisen from continuing operations.
Consolidated statement of total recognised gains and losses
Six months to Six months to Year ended
30 September 30 September 31 March
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Loss for the financial period (3,486,551) (2,033,430) (4,697,011)
Prior period adjustments - - (818,507)
__________ __________ __________
Total gains and losses relating to the (3,486,551) (2,033,430) (5,515,518)
period
__________ __________ __________
Consolidated balance sheet
30 30 31 March
September September
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Fixed assets
Intangible assets 523,944 685,758 297,524
Tangible assets 332,243 171,589 215,011
__________ __________ __________
856,187 857,347 512,535
__________ __________ __________
Current assets
Stocks 128,210 28,560 110,985
Debtors 1,153,620 865,784 395,723
Cash at bank and in hand 3,986,606 1,587,624 47,438
__________ __________ __________
5,268,436 2,481,968 554,146
Creditors: Amounts falling due within one (1,911,096) (1,869,172)(2,059,832)
year
__________ __________ __________
Net current assets (liabilities) 3,357,340 612,796 (1,505,686)
__________ __________ __________
Shareholders' funds (deficit) 4,213,527 1,470,143 (993,151)
__________ __________ __________
Shareholders' funds (deficit) may be
analysed as:
Equity interests 479,700 (641,658)(3,157,747)
Non-equity interests 3,733,827 2,111,801 2,164,596
__________ __________ __________
4,213,527 1,470,143 (993,151)
__________ __________ __________
Reconciliation of movements in shareholders' funds
30 30 31 March
September September
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Loss for the financial period (3,486,551)(2,033,430)(4,697,011)
__________ __________ __________
New equity share capital subscribed 169,741 25,954 38,376
New preference share capital subscribed 1,479,450 2,111,801 2,111,801
Premium on new share capital subscribed
net of 6,954,257 1,361,190 1,496,260
expenses
Dividends on non-equity shares 89,781 - 52,795
__________ __________ __________
Net addition (reduction) to shareholders'
funds 5,206,678 1,465,515 (997,779)
Opening shareholders' (deficit) funds (993,151) 4,628 4,628
__________ __________ __________
Closing shareholders' funds (deficit) 4,213,527 1,470,143 (993,151)
__________ __________ __________
Consolidated cash flow statement
Six months Six months Year
to to ended
30 30 31 March
September September
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Net cash outflow from operating activities (3,986,649)(1,766,644)(3,177,778)
__________ __________ __________
Returns on investments and servicing of finance
Interest paid (9,402) (2,931) (21,297)
Interest received 94,456 1,805 28,675
__________ __________ __________
Net cash inflow (outflow) 85,054 (1,126) 7,378
__________ __________ __________
Capital expenditure and financial investment
Purchase of intangible fixed assets (535,000) (35,000) (285,655)
Purchase of tangible fixed assets (193,904) (92,893) (161,067)
__________ __________ __________
Net cash outflow from capital expenditure (728,904) (127,893) (446,722)
__________ __________ __________
Cash outflow before financing (4,630,499)(1,895,663)(3,617,122)
__________ __________ __________
Financing
Issue of equity share capital 169,741 25,954 38,376
Issue of preference share capital 1,479,450 2,111,801 2,111,801
Share premium on issue of equity
and preference 6,954,257 1,361,190 1,496,260
share capital
__________ __________ __________
Net cash inflow 8,603,448 3,498,945 3,646,437
__________ __________ __________
Increase in cash 3,972,949 1,603,282 29,315
__________ __________ __________
Notes (unaudited)
1. Accounting Policies
The interim accounts have been prepared using accounting policies stated
in the Company's Report and Accounts for the year ended 31 March 2000 and
are unaudited.
2. Preparation of the Interim Financial Information
The comparative figures for the year ended 31 March 2000 are an abridged
version of the Company's full accounts and, together with other financial
information contained in these interim results, do not constitute
statutory accounts of the ITIS Holdings plc within the meaning of section
240 of the Companies Act 1985. The results for the year ended 31 March
2000 are an extract from the latest published accounts which have been
delivered to the Registrar of Companies and upon which the report of the
auditors was unqualified.
3. Loss per share
Six months Six months Year ended
to 30 to 30 31 March
September September 2000
2000 1999
Unaudited Unaudited Audited
£ £ £
Loss for the financial period (3,486,551) (2,033,430) (4,697,011)
__________ __________ __________
Weighted average number of ordinary
shares in issue 50,989,762 46,054,825 46,373,352
__________ __________ __________
Loss per ordinary share (p) (6.8) (4.4) (10.1)
__________ __________ __________
Due to losses made, there is no difference between loss per ordinary share
and diluted loss per ordinary share. On 12 September 2000, each ordinary
share of 10p in the capital of the company was sub-divided into 5 ordinary
shares of 2p.
4. Dividends on non-equity shares
Six months to Six months to Year ended
30 September 30 September 31 March
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Dividend on preference shares (89,781) - (52,795)
__________ __________ __________
5. Net cash outflow from operating activities
Six months Six months Year ended
to to
30 September 30 September 31 March
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Operating loss (3,481,824) (2,032,304) (4,651,594)
Depreciation and amortisation of
licenses 385,252 349,325 762,966
Increase in stocks (17,225) (28,560) (110,985)
Increase in debtors (757,897) (688,012) (217,951)
(Decrease) increase in creditors (114,955) 632,907 1,039,786
__________ __________ __________
Net cash outflow from operating
activities (3,986,649) (1,766,644) (3,177,778)
__________ __________ __________
6. Reconciliation of net cash flow to movement in net funds
Six months to Six months to Year ended
30 September 30 September 31 March
2000 1999 2000
Unaudited Unaudited Audited
£ £ £
Increase in cash in the period 3,972,949 1,603,282 29,315
__________ __________ __________
Change in net debt 3,972,949 1,603,282 29,315
Net funds (debt) brought forward 13,657 (15,658) (15,658)
__________ __________ __________
Net funds carried forward 3,986,606 1,587,624 13,657
__________ __________ __________
7. Post balance sheet event
On 16 October 2000, the company placed 16,129,033 new ordinary shares at
186 pence per share on its admission to the Alternative Investment Market.
8. Interim Statement
A copy of this announcement will be circulated to all registered
shareholders of the Company and copies will be available for members
of the public upon application to the Registered Office at The Warrant
House, 1High Street, Altrincham, Cheshire, WA14 1PZ.
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