Interim Results

RNS Number : 8472F
OMG PLC
30 May 2013
 



30 May 2013

 

OMG plc

 

("OMG" or the "Group")

 

Interim Results for the six months ended 31 March 2013

 

OMG plc (LSE: OMG), the technology group providing image understanding products for the entertainment, defence, life science and engineering industries, announces interim results for the six months ended 31 March 2013.

 

Financial Key Points

 

·     Group Revenue of £13.0m (H1 FY12: £13.6m)

·     Group Adjusted* Loss before Tax of £0.2m (H1 FY12: Adjusted* PBT of £0.7m)

Overall Group trading is in line with market expectations at half year end

Increased investment in OMG Life to prepare Autographer for volume launch

·     Group Cash position stable at £4.0m (H1 FY12: £3.9m)

 

Operational Key Points

 

·     Vicon

Launched Apex - a new 3D interaction device for the engineering market

Continued sales traction from Bonita mid-range of cameras

Vicon technology used in chart-topping video games including Dead Island Riptide, Call of Duty: BlackOps II and God of War: Ascension, and also in the forthcoming summer blockbuster film, World War Z

 

·     Yotta

Continued good sales momentum for SaaS-based Horizons platform

Significant multi-year contract wins nationwide including Cardiff, Carillion M40, West Sussex, Hillingdon and others

Five accredited survey vehicles now live with promising survey pipeline for H2

 

·     2d3

New versions of Tungsten, TacitView and Catalina software suites launched

Partnership announced with Insitu Inc., a wholly owned subsidiary of The Boeing Company, for Tungsten software

US sequestration has delayed the timing and shape of certain deals but pipeline remains strong

 

·     OMG Life

Increased investment in Autographer to provide a platform for growth

250 devices rigorously field tested and reviewed worldwide

Autographer product now ready for volume shipping, commencing 30 July 2013

 

Commenting on the results Nick Bolton, Chief Executive Officer said:

 

"The first half of this year has seen a number of developments. Some of those, particularly in 2d3, have been challenging where we find ourselves with a great product, a strong customer pipeline, but also uncertainty in US Government budgets caused by sequestration. In spite of that, we've made a good number of real steps forward for the business in H1, such as further sales momentum with our Horizons platform in Yotta, the continued appeal of our Bonita range in Vicon and the finishing touches we've put to our ground breaking Autographer product. That work has required greater investment than we first envisaged, but the Board firmly believes that it will help to generate important sales progress in the second half and beyond."

 

 

* Profit Before Tax from continuing operations before Group recharges adjusted for share based payments, amortisation of intangibles arising on acquisition, fair value adjustment to contingent consideration, unwinding of discount on contingent consideration, acquisition costs and redundancy costs. (See note 3)

 

For further information please contact:

 

OMG plc

+44 (0) 1865 261800

Nick Bolton, CEO


David Deacon, CFO




FTI Consulting

+44 (0) 20 7831 3113

Matt Dixon / Emma Appleton / Charles Palmer




N+1 Singer (NOMAD to OMG)

+44 (0) 20 7496 3000

Shaun Dobson / Jenny Wyllie


 

 

About OMG plc

OMG plc (Oxford Metrics Group. LSE: OMG) is a group of technology companies producing image understanding products and services for the entertainment, defence, life science and engineering industries.

 

Be it for capturing the movements of actors (for the movie industry), sportsmen (for video games or improving team performance), or children with Cerebral Palsy, rehab patients and animals (for medical, life science and research industries); or recording the condition of highways and the assets that surround them; or even providing image intelligence and situational awareness from drone aircraft. Through this diversified offering the Group has earned its strong international reputation for precision from pixels.

 

Founded in 1984, the Group is headquartered in Oxford, UK, and has four offices in the US and two in the UK. It has customers in over 50 countries and is a quoted company listed on AIM, a market operated by the London Stock Exchange. The Group trades through four operating subsidiaries: Vicon, the world leader movement analysis systems; 2d3 Sensing, providing video intelligence software for defence and civil applications, Yotta DCL, our infrastructure software and services business and OMG Life, our consumer subsidiary.

 

The Group's global clients spanning the worlds of science, medicine, sport, engineering, gaming, film and broadcast include: major hospitals and research facilities such as Guy's Hospital, Nuffield Orthopaedic Centre and Loughborough University, engineering industry leaders including: Ford Motor Company, BMW, Airbus and Toyota, and in the entertainment sector; Sony, Industrial Light and Magic, Sega, Nintendo, UbiSoft, EA and Square Enix. Infrastructure clients include Highways Agency, Atkins and Cumbria, Derbyshire and Pembrokeshire County Councils amongst others.

 

For more information about OMG and its subsidiaries, visit

www.omgplc.com, www.vicon.com, www.2d3.com, www.yottadcl.com and www.autographer.com 

 

 

Chairman and Chief Executive's Statement

 

The first half of this year has been a busy period for OMG across all areas of our business. In this first six months, we have continued to refine and develop our core Vicon technology; sharpened our execution within Yotta; consolidated 2d3's presence in the US defence market; and tuned the Autographer product so it is now ready for shipping in volume.

 

Since October 2013, a number of our most important initiatives have started to deliver real traction. For example, within Yotta, our Horizons software continues to prove its potential by achieving seven new wins and helping to inject an element of visibility and predictability to revenues here. Similarly, within Vicon, the latest Bonita range of mid-priced cameras that we introduced in May of last year has helped to stimulate upgrades from existing customers to higher value T-Series systems. This is an encouraging trend and we expect to see more of it in future years.

 

We have also seen challenges during the period that have held back progress in certain areas. Our product offering within 2d3, for example, remains excellent and interest from customers remains high. Sequestration in the US, however, has pushed out the timing of certain deals and altered the shape and scope of others. Whilst it is easy to be frustrated by events of this kind, we remain firmly of the view that our long-term position in this market is strong. A number of potential customers are actively seeking ways to work around sequestration issues to ensure they can purchase our technologies. That will inevitably take time to deliver results, but it is an indication of our products' strengths and an encouraging signal to us as a Board.

 

In spite of short term challenges, our attention remains firmly focused on the long term potential for our Group. To that end, innovation has been a key feature of the first half of the year. Each of our innovations, be it Autographer, our new Apex product within Vicon or our new fleet of vehicles within Yotta, has been developed to target a real, emerging sales opportunity. Our task in the second half is to focus on realising this opportunity. The important and significant investments we have made in recent months will play a key role in helping us achieve this goal.

Financial Summary

KPI

H1 FY13

H1 FY12

Change

Group Revenue

£13.0m

£13.6m

-£0.6m

Group Cash position

£4.0m

£3.9m

+£0.1m

Group Adjusted* - (Loss) Profit before Tax

(£0.2m)

£0.7m

-£0.9m

 

During the first half, Group revenue decreased year on year by 4.0% to £13.0m (H1 FY12: £13.6m). The Group reports an adjusted* loss before tax for the period of £0.2m (H1 FY12: Profit £0.7m). Overall, the Group excluding OMG Life is trading as expected and consistent with market expectations but the increase in costs in OMG Life to prepare Autographer for volume shipment largely accounts for the decrease in profits compared to the first half of last year. Cash at bank as at 31 March 2013 stood at £4.0m (H1 FY12: £3.9m).

OMG Vicon


Revenue

PBT

Adjusted* PBT


H1 FY13

H1 FY12

H1 FY13

H1 FY12

H1 FY13

H1 FY12

Vicon UK

£4.2m

£4.7m

£1.9m

£1.4m

£1.4m

£0.9m

Vicon US

£4.1m

£4.3m

£0.4m

£0.3m

£1.6m

£1.6m

Total Vicon

£8.3m

£9.0m

£2.3m

£1.7m

£3.0m

£2.5m

HoM

£1.2m

£1.5m

(£0.4m)

£0.0m

(£0.4m)

(£0.0m)

 

Our Vicon systems' business reported a solid start to FY13 with an improved adjusted* PBT of £3.0m (H1 FY12: £2.5m), despite seeing a modest decline in revenues (H1 FY13: £8.3m vs. H1 FY12: £9.0m). This improved profit position reflects the cost reduction measures implemented in the first half of FY12 and the changing nature of the mix of product revenues. It is worth noting this revenue performance was achieved from a diverse set of countries and without any dependency on any single large deals; the largest system purchase in the first half totalled £230,000. This indicates the broad geographic appeal of the differentiated product and the robustness of the subsidiary's revenues.

The product highlight of the half was the launch and shipment of the company's new Apex product. Apex is a 3D interaction device about the size of a small football. The device is held in the hand and enables users to manipulate objects in virtual reality environments. This enables engineers to get a better understanding of the impact of their design choices before going into production. Apex is a great new addition to the company's offer in the engineering market and we expect it to drive sales in this sector through the second half and into next year.

Bonita sales continue to grow as a proportion of overall shipments. Bonita is Vicon's entry-level camera range and has opened the world of precision tracking which Vicon has always offered, at a more accessible price point. Bonita uses all the same software as the top-end product, the T-Series, enabling the customer to preserve their learning investment as they grow with the company's product ranges. In fact, we saw a number of Bonita customers upgrade their systems to T-Series in the first half.

The outlook for Vicon Systems for the second half is positive, with further shipments of the new product releases, the business expects Vicon to deliver market expectations.

House of Moves, our motion capture and animation services studio in Los Angeles, reported revenues of £1.2m (H1 FY12 £1.5m) and an adjusted* operating loss of £0.4m (H1 FY12: Breakeven) before allocation of Group overheads. The entertainment market as a whole remains unpredictable and, as a consequence, demand for our services remain volatile.

OMG Yotta


Revenue

PBT

Adjusted* PBT


H1 FY13

H1 FY12

H1 FY13

H1 FY12

H1 FY13

H1 FY12

Yotta UK

£2.5m

£2.0m

(£0.5m)

(£0.4m)

(£0.2m)

(£0.2m)

 

Yotta reported revenues up 24.4% compared to the same period last year at £2.5m (H112: £2.0m). Despite challenging weather during the winter months, which affected operational efficiency, revenues increased following a further seven Horizon software deals in the first half. Horizons is provided as a Software as a Service (SaaS) product, so customers pay a repeatable annual fee to gain access to the product's capabilities. In addition, professional services consulting revenues also improved which, together with the increased software revenues, saw the revenue mix shift favourably away from weather-dependent surveying revenues.

There were significant multi-year contract wins at Cardiff, Carillion M40, West Sussex and the London Borough of Hillingdon amongst others. Of particular note was the East Sussex strategic partnership win. Yotta has provided highway surveying to East Sussex for many years and this award, won through competitive tendering, highlights the value the company can offer through its Horizons product and its consultancy services, particularly in the area of strategic advice. The range of work will include consolidating networks, generating National Indicator and Whole of Government Accounting reports and helping with gap analysis to identify existing and missing data.

Post period end, Yotta has been awarded a contract to help Hertfordshire County Council - a longstanding client - to develop cost-effective asset data collection regimes to manage and improve its road network. This contract was won through competitive tender process and validates the strength of Yotta's broader-based offer.

The outlook for the second half is encouraging, the company now runs a fleet of five accredited highways measurement vehicles which are now engaged in revenue earning activities including the premier TRACS contract with the Highways Agency announced previously. The pipeline for Horizons is also promising for the second half, so as a whole Yotta is expected to deliver market expectations.

OMG 2d3


Revenue

PBT

Adjusted* PBT


H1 FY13

H1 FY12

H1 FY13

H1 FY12

H1 FY13

H1 FY12

UK

£0.2m

£0.2m

(£0.2m)

(£0.1m)

(£0.1m)

£0.0m

US

£0.8m

£0.9m

(£1.0m)

(£0.5m)

(£0.7m)

(£0.3m)

Total 2d3

£1.0m

£1.1m

(£1.2m)

(£0.6m)

(£0.8m)

(£0.3m)

 

2d3, our intelligence from imagery business serving the defence and civil aviation industry, reported revenues of £1.0m (H1 FY12: £1.1m) and an adjusted* operating loss of £0.8m (H1 FY12 loss: £0.3m) before allocation of Group overheads. The increased loss reflects the Group's increased investment in demand generation, including the recruitment in the first half of three industry veterans into business development roles. These investments are building on the success the business enjoyed in the second half of last year, when the company was awarded two software license deals in excess of $1m each.

The business as a whole is largely dependent on the US Defence market and as a consequence revenues are skewed toward the second half as was the case last year. Whilst the Group believes that defence budgets for Intelligence, Surveillance and Reconnaissance ('ISR') will ultimately be protected, the announcement by the US Government of sequestration measures in March 2013 affecting military budgets has resulted in some uncertainty. For 2d3, this has manifested itself with a number of deals being subject to delay and in some cases deals which had been previously a co-operative acquisition by several defence agencies have now been split into separate opportunities.

2d3 were busy in the first half introducing new versions of their software suite, including Tungsten, TacitView and Catalina. More recently, they have launched a further capability in those products, Reticle FMV (Full Motion Video) metadata improvement and geo-registration. The geospatial data in video streams from aerial sources is often of poor quality with frequent errors and containing no information as to where the image is positioned on the earth's surface. Reticle offers both automatic and user-managed remedies enabling the creation of more useful intelligence product from surveillance imagery with better geospatial accuracy.

On the partnership side, 2d3 announced it will supply Insitu Inc., a wholly owned subsidiary of The Boeing Company, with Tungsten, 2d3's digital media management and exploitation software. Tungsten will be integrated into Insitu's ICOMC2 (Insitu Common Open-Mission Management Command and Control) solution. This allows users to access multiple video streams simultaneously from an unmanned aircraft in real-time. Going forward Tungsten will play an integral role in ICOMC2's motion imagery infrastructure.

The 2d3 pipeline for the second half is the highest ever but the sales effort to close and manage multiple opportunities is an additional challenge and problematic to forecast. In summary, sequestration does not appear to have reduced the opportunity for 2d3 but some deals expected in FY13 are now likely to shift into FY14. From a revenue perspective the Board believes that the operation is on target to fulfil market expectations but will require closure of other revenue opportunities in a currently uncertain defence market to hit profit targets as well.

OMG Life


Revenue

PBT

Adjusted* PBT


H1 FY13

H1 FY12

H1 FY13

H1 FY12

H1 FY13

H1 FY12

OMG Life UK

£0.0m

£0.0m

(£1.1m)

(£0.3m)

(£1.0m)

(£0.3m)

 

As highlighted at the AGM in March 2013, the Company has increased investment in OMG Life, our consumer market subsidiary, to provide a platform for growth. As a result, the operation reported an adjusted* loss of £1.0m (H1 FY12 Loss £0.3m).

 

In the first half, the Company has been focussed on bringing its first product, Autographer, to market. Autographer is the world's first automatic wearable camera and generated a significant amount of market interest following its launch in September 2012. Since then the Company has manufactured over 250 devices, which have been in active use around the world. All the feedback from the millions of unique images captured has been used to fine-tune both the technology and the proposition to ensure the product fully meets the demands of the consumer marketplace.

The pioneers who have been using these first Autographers have provided us with a range of new insights into the product's benefits. Users valued the truly natural, unposed nature of the images and the fact that the camera didn't interrupt the event they were wanting to capture - they could get on with rowing the boat, climbing the mountain and enjoying the moment rather than having to think about getting their camera out. The unique, wide-angle lens was viewed as an essential part of the product which added creative interest and wider context to all images - ensuring no action was missed, capturing landscapes from captivating new perspectives and portraying more life than a standard narrow angle lens. They loved the way the camera and software allowed them to manage a large number of images and simply create a video storyboard from the sequence of pictures; they saw the output as neither photography nor video but something new and exciting - Autography.

These behavioural insights have been used to hone our marketing plans and equally the large body of images taken through the testing process have been used to optimise the technology. The camera now takes the very best possible shot in a wide variety of environments and situations - indoors and outdoors, portraits and landscapes, rural and urban.

All this excellent work means the product is now ready for volume shipping, which will begin on 30 July 2013. The product will be sold direct online via www.autographer.com. Due to the high level of global interest in the product, availability will be staggered by region so initial demand can be managed. Shipping will commence into European countries and then open up to the US and wider thereafter. As the volumes develop we will update the market in the full year results.

Given the size of the market opportunity across the globe, it is clear Autographer has the potential to transform the shape of the Group, by providing an outlet for our excellent previously B2B only technology in the broader consumer marketplace. We look forward to updating the market with volume sales data at the time of the full year results. In the meantime, the blog on the Autographer website is the best way to stay up-to-date with developments and share in the excitement of the project.

 

Outlook

As is typical for our Group, we anticipate delivering a second half trading performance that is stronger than the first half. At a Group level we anticipate our full year revenue performance will be in line with current market expectations, driven both by continued sales of existing products and a full trading opportunity for new products introduced in the first half. The second half will see us achieve a number of important trading milestones, such as the first volume sales of Autographer and increased adoption of Horizons by new and existing Yotta customers.

Whilst this strong trading expectation reaffirms our belief in the Group's product offering and strategy, we believe that our profitability performance for the full year will now be a degree below current market expectations. Primarily this is due to the important investments we have made in bringing Autographer to market: a product that will help to generate sales momentum in the second half and beyond.

The Board remains confident in the Group's strategy; in the strength of its offering and position in key markets; and of its ability to deliver sustained, balanced and profitable growth over the long term.

 

CONDENSED CONSOLIDATED INCOME STATEMENT

 



Six months ended

31 March

2012

Year

ended

 30 September 2012



(unaudited)

(audited)


Note

£'000

£'000

£'000

Revenue

2

13,587

29,504

Cost of sales


(5,599)

(5,780)

(11,797)

Gross profit


7,807

17,707

Sales, support and marketing costs


(2,139)

(4,681)

Research and development


(1,195)

(2,697)

Administrative expenses - exceptional


(186)

(203)

                                              - other


(3,937)

(7,986)

Other income


22

23

168

Operating (loss)/profit


(586)

373

2,308

Finance income


3

8

Finance expense


(155)

(1)

(540)

(Loss)/profit before taxation

2,3

375

1,776

Taxation

4

232

(58)

(685)

(Loss)/profit from continuing operations


(504)

317

1,091

Profit/(loss) on discontinued operation net of tax


2

(36)

(34)

(Loss)/profit for the period attributable to

owners of the parent during the period


(502)

281

1,057






Basic (loss)/earnings per share (pence)

5

0.39p

1.48p

Diluted (loss)/earnings per share (pence)

5

0.39p

1.43p





Continuing operations




Basic (loss)/earnings per share (pence)

5

0.44p

1.53p

Diluted (loss)/earnings per share (pence)

5

0.44p

1.47p

 

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

 



Six months ended

31 March

2013

Six months ended

 31 March

2012

Year

ended

 30 September 2012



(unaudited)

(unaudited)

(audited)


Note

£'000

£'000

£'000

Net (loss)/profit for the period


(502)

281

1,057

Other comprehensive income





Currency translation differences


199

29

(52)

Tax recognised directly in equity


40

14

(2)

Total other comprehensive income


239

43

(54)

Total comprehensive income for the period attributable to the owners of the parent


(263)

324

1,003

 

 

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

 

 



31 March

2013

30 September

2012



(unaudited)

(audited)


Note

£'000

£'000

£'000

Non-current assets





Intangible assets


6,057

5,329

Goodwill


6,886

6,638

Property, plant and equipment


2,275

2,162

Financial asset - investment


69

69

Deferred tax asset


855

700

362



16,142

14,560

Current assets




Inventories


2,478

1,874

Trade and other receivables


7,353

9,415

Cash and cash equivalents


3,959

3,934

4,341



13,790

13,580

15,630

Current liabilities




Trade and other payables


(6,253)

(4,863)

(6,115)

Current tax liabilities


(104)

(1)

(36)



(6,357)

(4,864)

(6,151)





Net current assets


7,433

8,716

9,479

Total assets less current liabilities


23,575

22,720

24,039

 

Non-current liabilities





Financial liabilities


(1,486)

(2,255)

Deferred tax liability


(1,911)

(1,468)

(1,742)



(3,397)

(3,432)

(3,997)






Net assets


20,178

19,288

20,042






Capital and reserves attributable to the owners of the parent




Share capital

6

182

179

Shares to be issued


65

65

Share premium account


7,029

7,028

Merger reserve


4,008

3,546

Retained earnings


8,716

9,245

Foreign currency translation reserve


178

60

(21)

Total equity shareholders' funds


20,178

19,288

20,042

 

 

CONDENSED CONSOLIDATED STATEMENT OF CASHFLOWS

 



Six months

ended

31 March

2013

Six months ended

31 March

2012

Year

ended

30 September 2012



(unaudited)

(unaudited)

(audited)


Note

£'000

£'000

£'000

Cash flows from operating activities





Operating (loss)/profit


(586)

373

2,308

Depreciation and amortisation


710

724

1,387

Impairment of intangibles


-

396

456

Share based payments


654

6

80

Exchange adjustments


(320)

308

288

Increase in inventories


(567)

(132)

(135)

Decrease/(increase) in receivables


2,344

507

(1,162)

(Decrease)/increase in payables


(936)

350

1,245

Cash generated from continuing operations


1,299

2,532

4,467

Discontinued operations


17

(9)

(19)

Cash generated from operating activities


1,316

2,523

4,448

Tax paid


(10)

48

50

Net cash from operating activities


1,306

2,571

4,498






Cash flows from investing activities





Purchase of property, plant and equipment


(381)

(222)

(535)

Purchase of intangible assets


(1,054)

(1,007)

(2,315)

Proceeds on disposal of property, plant and equipment


6

27

174

Interest received


5

3

8

Net cash used in investing activities


(1,424)

(1,199)

(2,668)






Cash flows from financing activities





Issue of ordinary shares


1

5

6

Payment of finance lease liabilities


(66)

(9)

(53)

Interest element of finance lease repayments


(5)

(1)

(3)

Equity dividends paid


(255)

(214)

(214)

Net cash used in financing activities


(325)

(219)

(264)






Net (decrease)/increase in cash and cash equivalents


(443)

1,153

1,566

Cash and cash equivalents at beginning of the period


4,341

2,817

2,817

Effect of exchange rate changes


61

(36)

(42)

Cash and cash equivalents at end of the period


3,959

3,934

4,341






 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES TO EQUITY

 

 


Share

Capital

Shares

to be

issued

Share premium account

Merger reserve

Retained earnings

Foreign currency translation reserve

Total


£'000

£'000

£'000

£'000

£'000

£'000

£'000

Balance as at 1 October 2012

179

65

7,028

3,546

9,245

(21)

20,042

Total comprehensive income for the period

-

-

-

-

(462)

199

(263)

Transactions with owners:








Dividends

-

-

-

-

(255)

-

(255)

Shares issued

3


1

462

-

-

466

Movement in relation to share based payments

-

-

-

-

188

-

188

Balance as at 31 March 2013

182

65

7,029

4,008

8,716

178

20,178

















Balance as at 1 October 2011

178

65

6,998

3,546

8,349

31

19,167

Total comprehensive income for the period

-

-

-

-

295

29

324

Transactions with owners:








Dividends

-

-

-

-

(214)

-

(214)

Shares issued

1


4

-

-

-

5

Movement in relation to share based payments

-

-

-

-

6

-

6

Balance as at 31 March 2012

179

65

7,002

3,546

8,436

60

19,288

















Balance as at 1 October 2011

178

65

6,998

3,546

8,349

31

19,167

Total comprehensive income for the period

-

-

-

-

1,055

(52)

1,003

Transactions with owners:








Dividends

-

-

-

-

(214)

-

(214)

Issue of share capital

1

-

30

-

-

-

31

Movement in relation to share based payments

-

-

-

-

55

-

55

Balance as at 30 September 2012

179

65

7,028

3,546

9,245

(21)

20,042









The accompanying notes are an integral part of this interim financial information

 

 

NOTES TO THE CONDENSED CONSOLIDATED INTERIM STATEMENTS

 

1.   Basis of preparation

 

OMG Plc (the "Company") is a company domiciled in England. The condensed consolidated interim financial statements of the Company for the six months ended 31 March 2013 comprise the Company and its subsidiaries (together referred to as the "Group").

 

The following IFRIC amendments and IASs have been issued by the IASB, but are applicable to future periods. They are not expected to have any material impact on the Group's reporting:

 

·     IFRS 9 'Financial Instruments'

·     IFRS 10 'Consolidated Financial Statements'

·     IFRS 11 'Joint Arrangements'

·     IFRS 12 'Disclosure of Interests in Other Entities'

·     IFRS 13 'Fair Value Measurement'

·     IAS 27 'Separate Financial Statements'

·     IAS 28 'Investments in Associates and Joint Ventures'

·     IFRIC 20 'Stripping Costs in the Production Phase of a Surface Mine'

·     Amendments to IFRS1 ' Government Loans'

·     Amendments to IFRS7 ' Disclosures: Offsetting Financial Assets and Financial Liabilities'

·     Amendments to IAS 19 'Employee Benefits'

·     Amendments to IAS 32  'Offsetting Financial Assets and Financial Liabilities'

 

Otherwise, the condensed consolidated interim financial statements have been prepared using accounting policies consistent with those of the annual financial statements for the year ended 30 September 2012. They are in accordance with IAS 34.

 

The interim financial statements have not been audited or reviewed and the financial information contained in this report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The comparative figures for the year ended 30 September 2012 are not the statutory accounts but have been extracted from the Group's 2012 financial statements which have been delivered to the Registrar of Companies. The auditors' report on those financial statements was unqualified did not contain references to any matters to which the auditors drew attention without qualifying the report and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. 

 

Segmental reporting

 

Segment information is presented in the condensed consolidated interim financial statements in respect of the Group's business segments, which are reported to the Chief Operating Decision Maker (CODM). The Group has identified the Board of Directors of OMG plc ("the Board") as the CODM. The business segment reporting reflects the Group's management and internal reporting structure.

 

The Group comprises the following business segments:

 

Vicon Group:  This is the development, production and sale of computer software and equipment for the entertainment, engineering and life science markets;

 

Yotta Group: This is services for the management of infrastructure and taxation, highway surveying and associated software development;

 

2d3 Group:  This is the development and sale of computer software and equipment for the defence market;

 

OMG Life:  This is the direct to consumer segment currently engaged in product development.

 

Other unallocated costs represent head office expenses not recharged to subsidiary companies.

 

Business segments are analysed below:






Revenue

(Loss)/profit before tax


Six months ended 31 March 2013 (unaudited)

Six months  ended 31 March 2012 (unaudited)

Year ended 30 September 2012   (audited)

Six months ended 31

 March 2013 (unaudited)

Six months       ended 31 March 2012 (unaudited)

Year ended 30 September 2012

 (audited)


£'000

£'000

£'000

£'000

£'000

£'000

Vicon UK

4,227

4,664

9,055

1,879

1,446

2,854

Vicon USA

4,125

4,292

7,915

431

301

378

House of Moves USA

1,204

1,461

4,024

(391)

(50)

917

Vicon Group

**9,556

**10,417

20,994

1,919

1,697

4,149








Yotta UK

2,457

1,975

4,278

(496)

(406)

(803)

Yotta Group

2,457

1,975

4,278

(496)

(406)

(803)








2d3 UK

209

264

467

(182)

(55)

(255)

2d3 USA

805

882

3,662

(1,007)

(531)

(99)

2d3 Group

1,014

1,146

4,129

(1,189)

(586)

(354)








OMG Life

17

49

103

(1,110)

(319)

(1,151)

Unallocated

-

-

-

140

(11)

(65)

Continuing operations

13,044

13,587

29,504

(736)

375

1,776








Yotta USA - discontinued operation

-

-

-

2

(36)

(33)

OMG Group

13,044

13,587

29,504

(734)

339

1,743

 

 

 


Underlying (loss)/profit before tax

Non-current assets


Six months ended 31 March 2013 (unaudited)

Six months  ended 31 March 2012 (unaudited)

Year ended 30 September 2012   (audited)

Six months ended 31 March 2013 (unaudited)

Six months ended 31

March 2012 (unaudited)

Year ended 30 September 2012

 (audited)


£'000

£'000

£'000

£'000

£'000

£'000

Vicon UK

1,897

1,427

2,842

2,521

2,250

2,377

Vicon USA

431

487

564

1,233

1,297

1,155

House of Moves USA

(391)

(50)

920

929

823

682

Vicon Group

1,937

1,864

4,326

4,683

4,370

4,214








Yotta UK

(416)

(357)

(677)

4,495

4,038

4,365

Yotta Group

(416)

(357)

(677)

4,495

4,038

4,365








2d3 UK

(177)

(55)

(255)

20

220

24

2d3 USA

(735)

(415)

738

4,920

4,505

4,641

2d3 Group

(912)

(470)

483

4,940

4,725

4,665








OMG Life

(1,091)

(319)

(1,142)

1,774

671

1,150

Unallocated

247

12

(27)

250

191

166

Continuing operations

(235)

730

2,963

16,142

13,995

14,560








Yotta USA - discontinued operations

2

(36)

(33)

-

9

-

OMG Group

(233)

694

2,930

16,142

14,004

14,560

 

 

 




Six months ended 31 March 2013 (unaudited)

Six months  ended 31 March 2012 (unaudited)

Year ended 30 September 2012   (audited)





£'000

£'000

£'000




Revenue by origin







UK

6,910

6,952

13,904




USA - continuing operations

6,134

6,635

15,600




Continuing operations

13,044

13,587

29,504




USA - discontinued operations

-

-

-




OMG Group

13,044

13,587

29,504











Revenue by destination







UK

3,096

2,995

6,298




Europe

1,310

1,363

2,679




North America

5,658

6,513

15,466




Asia Pacific

2,604

2,449

4,482




Other

376

267

579




Continuing operations

13,044

13,587

29,504




North America - discontinued operations

-

-

-




OMG Group

13,044

13,587

29,504




 

**The following additional information is provided to the Chief Operating Decision Maker. Further analysis by market is not available.

 


Six months ended 31 March 2013 (unaudited)

Six months  ended 31 March 2012 (unaudited)

Year ended 30 September 2012   (audited)





£'000

£'000

£'000




Revenue by market







Engineering

1,795

1,569

2,983




Entertainment

3,044

4,369

9,239




Life sciences

4,717

4,479

8,772





9,556

10,417

20,994




 

An analysis of adjusted profit before tax net of Group recharges is provided below:

 


Six months ended 31 March 2013 (unaudited)

Six months  ended 31 March 2012 (unaudited)

Year ended 30 September 2012   (audited)


Under-lying    PBT

Group recharges

Adjusted PBT

Under-lying    PBT

Group recharges

Adjusted PBT

Under-lying    PBT

Group recharges

Adjusted PBT


£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Vicon UK

1,897

(545)

1,352

1,427

(526)

901

2,842

(859)

1,983

Vicon USA

431

1,198

1,629

487

1,113

1,600

564

2,091

2,655

House of Moves USA

(391)

-

(391)

(50)

-

(50)

920

-

920

Vicon Group

1,937

653

2,590

1,864

587

2,451

4,326

1,232

5,558











Yotta UK

(416)

207

(209)

(357)

183

(174)

(677)

400

(277)

Yotta Group

(416)

207

(209)

(357)

183

(174)

(677)

400

(277)











2d3 UK

(177)

87

(90)

(55)

77

22

(255)

5

(250)

2d3 USA

(735)

75

(660)

(415)

78

(337)

738

315

1,053)

2d3 Group

(912)

162

(750)

(470)

155

(315)

483

320

803











OMG Life

(1,091)

71

(1,020)

(319)

62

(257)

(1,142)

132

(1,010)

Unallocated

247

(1,093)

(846)

12

(987)

(975)

(27)

(2,084)

(2,111)

Continuing operations

(235)

-

(235)

730

-

730

2,963

-

2,963

 

 


Carrying amount of segment assets

Carrying amount of segment liabilities


Six months ended 31 March 2013 (unaudited)

Six months  ended 31 March 2012 (unaudited)

Year ended 30 September 2012   (audited)

Six months ended 31 March 2013 (unaudited)

Six months  ended 31

 March 2012 (unaudited)

Year ended 30 September 2012

(audited)


£'000

£'000

£'000

£'000

£'000

£'000

Vicon UK

7,400

6,016

8,684

(2,337)

(2,104)

(2,309)

Vicon USA

4,627

4,971

4,069

(1,396)

(1,439)

(1,204)

House of Moves USA

1,880

1,696

1,802

(272)

(244)

(264)

Vicon Group

13,907

12,683

14,555

(4,005)

(3,787)

(3,777)








Yotta UK

8,862

8,780

8,122

(1,747)

(1,248)

(1,358)

Yotta Group

8,862

8,780

8,122

(1,747)

(1,248)

(1,358)








2d3 UK

1,632

2,395

1,447

(68)

(134)

(63)

2d3 USA

5,741

5,432

7,183

(3,030)

(2,518)

(3,594)

2d3 Group

7,373

7,827

8,630

(3,098)

(2,652)

(3,657)








OMG Life

(122)

(395)

(487)

(671)

(280)

(710)

Unallocated

(139)

(1,377)

(677)

(228)

(324)

(641)

Continuing operations

29,881

27,518

30,143

(9,749)

(8,291)

(10,143)








Yotta USA - discontinued operations

51

66

47

(5)

(5)

(5)

OMG Group

29,932

27,584

30,190

(9,754)

(8,296)

(10,148)

 

 


Additions to non-current assets

Segment depreciation and amortisation


Six months

 ended 31

 March 2013

 (unaudited)

Six months  ended 31

 March 2012 (unaudited)

Year ended 30 September 2012

(audited)

Six months  ended 31

March 2013 (unaudited)

Six months  ended 31

 March 2012 (unaudited)

Year ended 30 September 2012

(audited)


£'000

£'000

£'000

£'000

£'000

£'000

Vicon UK

371

486

926

237

277

483

Vicon USA

40

33

57

28

41

45

House of Moves USA

9

2

11

26

50

123

Vicon Group

420

521

994

291

368

651








Yotta UK

341

387

908

224

186

390

Yotta Group

341

387

908

224

186

390








2d3 UK

3

73

7

6

14

24

2d3 USA

49

24

401

179

146

296

2d3 Group

52

97

408

185

160

320








OMG Life

622

374

878

4

1

8

Unallocated

2

4

5

6

9

18

Continuing operations

1,437

1,383

3,193

710

724

1,387








Yotta USA -

discontinued operations

-

-

-

-

-

-

OMG Group

1,437

1,383

3,193

710

724

1,387

 

 

Reconciliation of underlying (loss)/profit before tax

 


Six months ended

31 March

 2013

Six months ended

31 March

 2012

Year

 ended

30 September

2012


(unaudited)

(unaudited)

(audited)


£'000

£'000

£'000

(Loss)/profit before tax - continuing operations

(736)

375

1,776

Share based payments - equity settled

188

6

55

Amortisation of intangibles arising on acquisition

163

163

323

Fair value adjustment to contingent consideration

-

-

69

Unwinding of discount on contingent consideration

150

-

537

Redundancy costs

-

186

203

Underlying (loss)/profit before tax - continuing operations

(235)

730

2,963





Profit/(loss) before tax - discontinued operations

2

(36)

(33)

Underlying profit/(loss) before tax - discontinued operations

2

(36)

(33)





Total underlying (loss)/profit before tax - all operations

(233)

694

2,930

 

Redundancy costs in the prior year relate to the reorganisation of operations at Vicon Motion Systems, inc.

 

 

2.   Taxation

 

The Group's consolidated effective tax rate for the six months ended 31 March 2013 was 31.5% (for the six months ended 31 March 2012: 15.5%; for the year ended 30 September 2012: 38.6%).

 

In accordance with IAS 34 the tax charge for the half year is calculated on the basis of the estimated full year tax rate.

 

Earnings per share

 

The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period. The calculation of diluted earnings per share is based on the basic earnings per share, adjusted to allow for the issue of shares on the assumed conversion of all dilutive options.

 


Six months

ended

31 March

2013

Six months ended

31 March

2012

Year

ended

30 September 2012


(unaudited)

(unaudited)

(audited)


£'000

£'000

£'000

(Loss)/profit from continuing operations

(504)

317

1,091

(Loss)/profit attributable to ordinary shareholders

(502)

281

1,057






000's

000's

000's

Weighted average number of ordinary shares for the purpose of basic earnings per share

72,325

71,348

71,453

Dilutive effect of employee share options

4,026

530

998

Dilutive effect of contingent  shares

-

-

1,563

Weighted average number of ordinary shares for the purpose of dilutive earnings per share

76,351

71,878

74,014





Continuing operations




Basic (loss)/earnings per share (pence)

(0.70)

0.44

1.53

Diluted (loss)/earnings per share (pence)

(0.70)

0.44

1.47





Total operations




Basic (loss)/earnings per share (pence)

(0.70)

0.39

1.48

Diluted (loss)/earnings per share (pence)

(0.70)

0.39

1.43

 

 

3.   Share capital

 


31 March

31 March

30 September


2013

2012

2012


(unaudited)

(unaudited)

(audited)


£'000

£'000

£'000

Authorised




100,000,000 ordinary shares of 0.25p

250

250

250

Allotted, called up and fully paid




72,945,951 shares of 0.25p (31 March 2012: 71,413,399 shares of 0.25p and 30 September 2012: 71,541,629 shares of 0.25p)

182

179

179

 

During the six month period ended 31 March 2013 1,400,988 shares were issued in relation to the contingent consideration payable for the acquisition of Sensing Systems Inc. In addition 3,334 shares were issued for cash in respect of share options exercised (six month period ended 31 March 2012: 65,000 shares).

 

During the year ended 30 September 2012 98,896 shares were issued to Sacker Gooding Limited as remuneration for services received. In addition 94,334 shares were issued relating to share option exercises

 

 

4.   Dividends

 

The following dividends were recognised as distributions to equity holders in the period:

 


31 March

31 March

30 September


2013

2012

2012


(unaudited)

(unaudited)

(audited)


£'000

£'000

£'000

Final dividend for 2012 paid in 2013 - 0.35 pence per share

255

214

214

 

The final dividend for 2012 was paid to shareholders on 1 April 2013 at 0.35 pence per share, a total of £255,000.

 

 

5.   Copies of the interim statement

 

Copies of the interim statement will be sent to shareholders. Further copies will be available from the Company's registered office at 14 Minns Business Park, West Way, Oxford OX2 0JB, and from the Company's website: www.omgplc.com.

 

 

 


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