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Vianet makes progress

By BFN News | 07:25 AM | Wednesday 09 October, 2013


Monitoring systems specialist Vianet Group said progress is being made in newer businesses including telemetry solutions for the coffee vending market. The Vending division is trading profitably and the Board believes there are good prospects for further contract developments in the second half of the year. The Group's operations in the USA also continue to make positive progress, with the performance of initial installations of iDraught�?¢ in both full commercial and pilot contracts with several national leisure chains meeting expectations. Trading in the Group's Fuel Solutions division has also continued to improve despite a slow start in Q1, making solid progress towards trading sustainably at breakeven level during H2 2013. As previously announced at the AGM in July 2013, the Board remains highly conscious of the uncertainty surrounding the Government's proposed Statutory Code for Pub Companies and the adverse impact that the proposals for controlling beer flow monitoring contained therein may have on the Group's core leisure business. In the UK pub sector there has been a slowdown in flow monitoring capital expenditure leading to a material shortfall in the anticipated number of new installations of iDraught�?¢ for this year. This same uncertainty has also accelerated the number of pub closures and disposals with a consequent reduction in the traditional beer monitoring installations to almost 17,000 sites at the half year. As previously stated, Vianet has submitted its comprehensive response to the consultation conducted by the Department of Business, Innovation and Skills, and has followed up with active engagement with MPs and other stakeholders to ensure that the factual evidence and arguments are being considered, and is pleased with the response so far received. The Board remains hopeful of a positive outcome in the final Statutory Code, however it remains cautious about the short term outlook for the Group's core Leisure division, until the new provisions of the Code are announced, particularly as the process may lead into the Christmas trading period. Against that background and taking account of all of the factors described above, the Board feels it is appropriate to exercise caution, and now anticipates that pre-exceptional operating profits for the current year ending 31 March 2014 will now be in the region of £3.0 million moderately below the £3.3 million achieved last year. Based on the trading outcome now anticipated and given the strength of the Group's cash flow, which is underpinned by high levels of recurring revenue, the Board expects to maintain both the interim and final dividend for the Group. Assuming a satisfactory outcome from the revised Statutory Code being announced in the second half of the current financial year, in the medium to longer term the Board remains optimistic for the growth prospects of the Company's flagship iDraught�?¢ product as well as the other parts of the Group which are benefitting from improved performance. Results for the six months ended 30th September 2013 will be released on Tuesday, 3rd December 2013 Story provided by StockMarketWire.com

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