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Castleton Technology (CTP)

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Tuesday 07 November, 2017

Castleton Technology

Half-year Report

RNS Number : 7236V
Castleton Technology PLC
07 November 2017
 

Castleton Technology plc

("Castleton", the "Group" or the "Company")

Unaudited Interim Results for the Six Months Ended 30 September 2017

Castleton Technology plc (AIM: CTP), the software and managed services provider to the public and not-for-profit sectors, today announces its unaudited interim results for the six months ended 30 September 2017.

Financial Highlights

·     Revenues increased 10.9% to £10.8 million (H1 FY17: £9.7 million), of which 63% are recurring

·     Adjusted EBITDA* increased 11.5% to £2.3 million (H1 FY17: £2.0 million)

·     Cash flow from operations of £2.3 million (H1 FY17: £1.8 million)

·     Profit before tax for the period of £0.2 million (H1 FY17: £0.04 million)

·     Net debt** (including deferred and contingent consideration) as at 30 September 2017 of £8.0 million (30 September 2016: £11.1 million), down from £9.7 million as at 31 March 2017

 

Operational Highlights

·     Significant new multi-year contract wins with North Hertfordshire Homes and a community regeneration and housebuilding company

·     Delivery of integrated product suite on two milestone contracts

·     Increase in software sales on a hosted basis leading to a stronger base of recurring revenues and greater visibility of earnings  

·     Strong customer retention with customer base now over 730

 

David Payne, Chairman of Castleton, commented:

"I am pleased to report on a strong performance from the Group during the first half of the year. Whilst recording significant organic growth in both revenues and profit, underpinned by excellent cash generation, the Group has also achieved some key operational milestones, notably the delivery of our integrated product suite on two milestone contracts, which illustrate both the appetite for the proposition and our ability to deliver.

Current trading remains robust and in line with market expectations. As such, the long term prospects for the Group remain positive and we are confident that we have the foundations in place to significantly scale the business."

 

* Before net finance costs, tax, depreciation, amortisation, exceptional items and share based payment charges

**Including deferred and contingent considerations and interest accrued on loan notes

Enquiries:

Castleton Technology plc

Dean Dickinson, Chief Executive Officer

Haywood Chapman, Chief Financial Officer

 

Tel. +44 (0)845 241 0220

 

finnCap

Jonny Franklin-Adams / Simon Hicks

 

Tel. +44 (0)20 7220 0500

 

 

MXC Capital Markets LLP

Marc Young / Charlotte Stranner

 

Tel. +44(0)20 7965 1849

 

Alma PR
Rebecca Sanders-Hewett

Helena Bogle

Josh Royston

Tel. +44(0) 203 865 9668

 

About Castleton Technology plc

Castleton Technology plc is a leading supplier of complementary software and managed services to the public and not-for-profit sectors. The Group is a 'one stop shop', providing integrated housing systems via the Cloud, working in partnership with its customers and resellers to help drive efficiencies whilst improving controls and customer service. www.castletonplc.com

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

 

 

Chairman's Statement

Dear Shareholder

I am pleased to report the results of the Group for the six months ended 30 September 2017. The prior year was one of consolidation for the Group, with the focus on completing the integration of the seven companies acquired during the previous two years. We therefore entered FY18 with a strong platform from which Castleton could grow and maximise the opportunities in our chosen markets. The first six months of FY18 have demonstrated that we are able to capitalise on this growth potential with the results showing significant growth in our revenues, adjusted EBITDA and profit before tax, as well as strong operating cash generation.

 

Operational Review

During the period we have implemented a new operational structure with clearly aligned objectives. Alongside this, sales teams have been tasked with defined territories and targets to enable the Company to better execute its strategy.

Significant multi-year contracts were won during the period. The long term nature of the contracts being entered into, as well as the increasing success we are experiencing in selling our products on a hosted basis, both increases our level of recurring revenues and provides better visibility of earnings and cash flow.

The delivery of Castleton's integrated product suite on two milestone contracts illustrates Castleton's ability to be a 'one stop shop' serving the social housing sector. This followed a period of significant product development and demonstrates that Castleton is able to provide its customers with the technology and services they require to operate effectively and achieve their goals.

The Group remains focused on increasing the number of customers who take multiple products, both by winning new customers and cross selling and upselling products to our existing base, thereby driving further growth in revenues and profit. Illustrating the Group's success in cross selling, the number of customers taking more than one product has increased in the period, with 37 new product sales to 21 existing customers.

 

Trading and Results

The Group generated revenue for the six months to 30 September 2017 of £10.8 million (H1 FY17: £9.7 million). Recurring revenues are more than 63% of total revenues, with further growth in recurring revenue expected due to the increasing number of multi-year contracts being entered into as well as the success in selling products on a hosted basis. Revenue in the Software Solutions division increased 14% and revenue in the Managed Services division increased 7% when compared to H1 FY17.

The Group generated an adjusted EBITDA* of £2.3 million in the period (H1 FY17: £2.0 million). Adjusted EBITDA* for the Software Solutions division and the Managed Services division (pre central costs) increased 20% and 5% respectively when compared to H1 FY17.

Central costs amounted to £0.7 million (H1 FY17: £0.6 million) before management recharges, excluding net finance costs, depreciation, amortisation of intangible assets, acquisition and integration costs and share based payments.

Exceptional costs amounted to £0.1 million (H1 FY17: £0.1 million) and related to restructuring costs of the Group's scanning bureau operation. 

Net finance costs amounted to a P&L charge of £0.17 million (H1 FY17: £0.20 million).

As the integration of businesses is now complete the cost base has stabilised, the increase in revenues and reduction in exceptional integration and strategic costs and acquisition and reorganisation costs has contributed to a profit before tax of £0.18 million (H1 FY17: £0.04 million). This is after amortisation of intangibles of £1.5 million (H1 FY17: £1.5 million). The amortisation of intangibles and utilisation of brought forward tax losses, alongside a reduction in future tax rates have resulted in a deferred tax credit of £0.4 million (H1 FY17: £0.6 million) leading to profit after tax of £0.6 million (H1 FY17: £0.6 million).

Basic earnings per share from continuing activities was 0.80p (H1 FY17: 0.80p). Diluted earnings per share from continuing activities was 0.75p (H1 FY17: 0.72p). Adjusted diluted earnings per share was 2.73p (H1 FY17: 2.32p).

*Before net finance costs, tax, depreciation, amortisation, exceptional items and share based payment charges.

Cash Flow and Net Debt

Cash generated by operations amounted to £2.3 million (H1 FY17: £1.8 million) comprising adjusted EBITDA* of £2.3 million (H1 FY17: £2.0 million) and operating working capital movements of £0.07 million (H1 FY17: £(0.28) million). This gave a cash conversion of EBITDA of 103% (H1 FY17: 86%) with the increase on H1 FY17 being largely driven by an increase in trade and other payables.

 

Net finance charges paid of £0.06 million (H1 FY17: £0.15 million) reflect the cash cost of the interest on the loan with Barclays, the balance of which has decreased due to repayments of £0.5 million (H1 FY17: £0.5 million) made during the period. As at the balance sheet date, £3.75 million of the term loan was outstanding.

 

In April 2017 Group repaid £0.5 million of the convertible loan notes issued in January 2016 to part fund the acquisition of Kypera ("Kypera Loan Notes"). There are £2.7 million Kypera Loan Notes outstanding, including £0.3 million of accrued interest (30 September 2016: £3.4 million including £0.1 million accrued interest).

 

On 21 June 2017, it was agreed by the beneficiaries of the Opus loan notes issued at the time of the Company's acquisition of Opus Information Technology Limited that they would waive the remaining £0.2 million of loan notes in consideration of surrendering any potential warranty claims for onerous contracts under the sale and purchase agreement.

The total increase in cash and net cash equivalents was £0.06 million (H1 FY17: decrease £0.02 million). Net Debt (including contingent and deferred consideration and interest accrued on loan notes) at the period end stood at £8.0 million, down from £9.7 million as at 31 March 2017 and £11.1 million as at 30 September 2016.

 

The Board

In July 2017 Ian Smith, Deputy Chairman, stepped down from the Board. We would like to thank Ian for his instrumental role in establishing and delivering Castleton's organic and acquisitive growth strategy.

At the same time, Paul Gibson was appointed as Non-Executive Director of the Company. Paul is a partner at MXC Capital Limited and has had a highly successful career in the TMT sector, most recently as Chief Operating Officer of Advanced Computer Software Plc ("ACS") prior to its acquisition by Vista Equity Partners for £725 million. In his five years at ACS Paul oversaw a period of exceptional value creation and transformation, with responsibility for driving both organic and acquisitive growth. Prior to ACS, Paul held a number of senior roles in both financial and operational capacities, latterly as Finance Director of Redac Limited, the Alchemy backed turnaround that was subsequently sold to ACS for £100 million. The foundations of Paul's career were built at Unigate, GrandMet (now Diageo) and Oracle. Paul is a qualified accountant and currently sits on the board of Tax Systems plc as Non-Executive Director.

 

Outlook

Castleton made significant progress during the first six months of the year and this has continued into the start of the second half.

We will continue to concentrate on driving further organic growth across the Group, whilst increasing profitability by providing more of our customers with our broader range of complementary services - and all the time building our core of repeat revenues. 

The Group remains on course to meet market expectations for the full year and looks forward to continuing to build on the solid foundations in place, cementing Castleton's position as a 'one stop shop' serving the social housing sector.

 

David Payne

Non-Executive Chairman

 

Consolidated Statement of Comprehensive Income

 

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March     2017

 

Note

£000

£000

£000

Revenue

2

10,785

9,725

20,269

Cost of sales

 

(3,633)

(3,073)

(5,980)

Gross profit

 

7,152

6,652

14,289

Administrative expenses

 

(6,799)

(6,418)

(14,100)

 

 

 

 

 

Adjusted EBITDA*

 

2,260

2,026

 

4,383

Depreciation

 

(129)

(123)

(225)

Amortisation of intangibles

 

(1,502)

(1,469)

(2,997)

Exceptional items included within administrative expenses

3

(133)

(107)

(741)

Charges for share-based payment

 

(143)

(93)

(231)

 

 

 

 

 

Operating profit

 

353

234

189

Net finance costs

 

(169)

(195)

(728)

 

 

 

 

 

 

 

 

 

 

Profit / (loss) on ordinary activities before taxation

 

184

39

(539)

 

 

 

 

 

Income Tax

4

442

589

1,002

 

 

 

 

 

Profit for the period attributable to the owners of the parent company

 

626

628

463

 

 

 

 

 

Earnings per share

5

 

 

 

Basic earnings per share

 

0.80p

0.80p

0.59p

Diluted earnings per share

 

0.75p

0.72p

0.54p

 

 

 

 

 

 

*Earnings for the period from continuing operations before net finance costs, depreciation, amortisation, exceptional items, group management charges and share based payment charges.

 

Consolidated Statement of Comprehensive Income

 

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March     2017

 

 

 

 

 

 

Note

£000

£000

£000

 

 

 

 

 

 

 

 

 

 

Net income

 

626

628

463

Exchange differences on translation of foreign operations

 

29

-

-

Total comprehensive income

 

655

628

463

 

The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.

 

 

 

Consolidated Statement of Financial Position

 

 

 

Note

Unaudited 30 September           2017

Unaudited 30 September         2016

Audited 31 March          2017

 

 

£000

£000

£000

 

 

 

 

 

Assets

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets

 

32,300

33,808

33,605

Property, plant and equipment

 

900

717

781

Trade and other receivables

 

148

376

261

 

 

33,348

34,901

34,647

 

 

 

 

 

Current assets

 

 

 

 

Inventories

 

72

13

50

Trade and other receivables

 

4,527

5,818

5,050

Current income tax asset

 

91

-

145

Cash and cash equivalents

 

571

644

586

 

 

5,261

6,475

5,831

 

 

 

 

 

Total assets

 

38,609

41,376

40,478

 

 

 

 

 

Equity and liabilities

 

 

 

 

Equity attributable to owners of the parent

 

 

 

 

Called up share capital

 

1,625

1,617

1,625

Share premium account

 

16,995

16,853

16,995

Equity reserve

 

2,668

2,919

2,919

Other reserves

 

7,966

7,966

7,966

Translation reserve

 

29

-

-

Accumulated loss

 

(12,976)

(13,969)

(13,996)

Total equity attributable to owners of the parent

 

16,307

15,386

15,509

 

 

Consolidated Statement of Financial Position (cont.)

 

 

 

 

 

 

 

 

Note

Unaudited 30 September           2017

Unaudited 30 September         2016

Audited 31 March          2017

 

 

£000

£000

£000

Liabilities

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

6

8,611

8,654

8,836

Current income tax liabilities

 

-

476

-

Finance leases

 

22

11

46

Borrowings

 

1,223

2,030

1,324

Convertible Loan notes

 

-

343

140

Deferred consideration

 

717

-

838

Provisions

 

721

311

751

 

 

11,294

11,825

11,935

 

 

 

 

 

Non-current liabilities

 

 

 

 

Trade and other payables

6

1,699

1,430

1,893

Borrowings

 

2,846

3,856

3,352

Convertible Loan notes

 

2,353

3,336

2,957

Deferred consideration

 

427

1,554

707

Contingent consideration

 

748

619

748

Provisions

 

-

224

-

Deferred taxation liability

 

2,935

3,146

3,377

 

 

11,008

14,165

13,034

Total liabilities

 

22,302

25,990

24,969

Total equity and liabilities

 

38,609

41,376

40,478

 

 

 

 

 

               

 

 

 

Consolidated Statement of Changes in Equity

                                          Attributable to shareholders of the parent company                            

 

Called up share capital

Share premium account

Equity Reserve   (b)

Merger reserve (a)

Translation reserve (c)

Retained earnings

Total equity

 

£000

£000

£000

£000

£000

£000

£000

1 April 2016

1,612

16,758

2,919

7,966

-

(14,690)

14,565

Profit for the period

-

-

-

-

-

628

628

Transactions with owners in their capacity as owners:

 

 

 

 

 

 

 

Share based payments

-

-

-

-

-

93

93

Conversion of loan notes (d)

5

95

-

-

-

-

100

At 30 September 2016

1,617

16,853

2,919

7,966

-

(13,969)

15,386

Loss for the period

-

-

-

-

-

(165)

(165)

Transactions with owners in their capacity as owners:

 

 

 

 

 

 

 

Conversion of loan notes (d)

8

142

-

-

-

-

150

Share based payments

-

-

-

-

-

138

138

At 1 April 2017

1,625

16,995

2,919

7,966

-

(13,996)

15,509

Profit for the period

-

-

-

-

-

626

626

Other comprehensive income

-

-

-

-

29

-

29

Transactions with owners in their capacity as owners:

 

 

 

 

 

 

 

Share based payments

-

-

-

-

-

143

143

Waiver of Opus loan notes

-

-

(251)

-

-

251

-

At 30 September 2017

1,625

16,995

2,668

7,966

29

(12,976)

16,307

 

a)     Merger reserve

The merger reserve arose from the acquisition of Redstone Communications Limited (£216,000) and Maxima Holdings Limited (£7.75 million) and represents the difference between the value of the shares acquired and the nominal value of the shares issued

b)     Equity reserve

The equity reserve consists of the equity element of convertible loan notes that were issued as part of the consideration for the acquisition of Kypera Holdings Limited. The fair value of the equity component of convertible loan notes issued is the residual value after deduction of the fair value of the debt component of the instrument from the fair value of the loan note.

c)     Translation reserve         

On consolidation, the balance sheet of Kypera Australia is translated into sterling at the rates of exchange ruling at the balance sheet date. Income statements and cash flows of Kypera Australia are translated into sterling at rates approximating to the foreign exchange rates at the date of the transaction. Gains or losses arising from the consolidation of Kypera Australia are recognised in the translation reserve.

d)     Conversion of loan notes

On 8 July 2016, the company issued 250,000 new ordinary shares of 2 pence each ("Ordinary Shares") at a price of 40 pence pursuant to the conversion of loan notes issued and on 4 October 2016 issued a further 375,000 new Ordinary Shares at a price of 40 pence pursuant to the conversion of loan notes issued as part of the previous acquisition of Opus Information Technology Limited.

Consolidated Cash Flow Statement

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March        2017

 

Note

£000

£000

£000

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

Cash generated from operations

7

2,331

1,751

4,581

Exceptional items

 

(395)

(404)

(797)

Income tax received

 

54

110

133

Net finance charges paid

 

(64)

(147)

             (256)

Net cash flows generated from operating activities

 

1,926

1,310

3,661

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Receipt of deferred consideration from sale of businesses

 

31

24

53

Acquisition of businesses, net of cash acquired

 

-

-

(450)

Purchase of intangible assets

 

(340)

(150)

(309)

Purchase of property, plant and equipment

 

(230)

(191)

(297)

Net cash flows used in investing activities

 

(539)

(317)

(1,003)

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Settlement of deferred consideration

 

(300)

(500)

(500)

Repayment of borrowings

 

(1,030)

(513)

(1,558)

Net cash flows used in financing activities

 

(1,330)

(1,013)

(2,058)

 

 

 

 

 

Net increase/(decrease) in cash and cash equivalents

 

57

(20)

600

Cash and cash equivalents at beginning of period

 

270

(330)

(330)

Effect of changes in exchange rate and other

 

29

-

-

Cash and cash equivalents at end of period

 

356

(350)

270

             

                                                                                                                                                                                               

Comprising:

Cash and cash equivalents

 

571

644

586

Overdrafts

 

(215)

(994)

(316)

 

 

356

(350)

270

 

Notes to the half-yearly financial information

1.     Basis of preparation and general information

The interim financial information is unaudited. This condensed consolidated interim financial information was approved by the Directors and authorised for issue on 6 November 2017.

The Company is a public limited liability company incorporated and domiciled in England. The address of its registered office is Castleton Technology plc ("Castleton"), 100 Fetter Lane, London, EC4A 1BN. The Company is listed on the AIM market of the London Stock Exchange.

The principal activity of the Group during the period was the provision of software and managed services to the public and not-for-profit sectors, predominantly the social housing sector.

Castleton and its subsidiaries have not applied IAS 34, Interim Financial Reporting, which is not mandatory for UK AIM listed companies, in the preparation of this half-yearly financial report.

This condensed, consolidated interim financial information for the six months ended 30 September 2017 does not comply, therefore with all the requirements of IAS 34, 'Interim financial reporting' as adopted by the European Union.  The consolidated interim financial information should be read in conjunction with the annual financial statements of Castleton for the year ended 31 March 2017, which have been prepared in accordance with IFRS as adopted by the European Union.

This condensed consolidated interim financial information does not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 March 2017 were approved by the Board of directors on 17 July 2017 and delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under sections 498 (2) or (3) of the Companies Act 2006.

 

Accounting policies

The accounting policies used in the preparation of the financial information for the six months ended 30 September 2017 are in accordance with the recognition and measurement criteria of International Financial Reporting Standards ("IFRS") as adopted by the European Union and are consistent with those which will be adopted in the annual statutory financial statements for the year ending 31 March 2018.

 

While the financial information included has been prepared in accordance with the recognition and measurement criteria of IFRS, as adopted by the European Union (EU), these financial statements do not contain sufficient information to comply with IFRSs.  

Going concern

The consolidated interim financial information of Castleton has been prepared on the going concern basis.

The Directors have prepared detailed cash flow projections including sensitivity analysis on key assumptions. The Group's forecasts and projections, taking account of reasonably possible changes in trading performance and the timing of key strategic events, show the Group will be able to operate within the level and conditions of available funding. The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.

Based on these facts, the Directors consider that the adoption of the going concern basis is appropriate.

 

 

 

2.     Segment reporting

Operating segments are reported in a manner consistent with the internal reporting to the Chief Operating Decision Makers ('CODM'). The CODM has been identified as the Executive Board.

The Group is comprised of the following main operating segments:

Managed Services In this segment are the results of Castleton Managed Services Ltd for the six months ended 30 September 2017.

Software Solutions This segment comprises the results of Castleton Software Solutions Ltd, Kypera Limited and Kypera Australia Pty for the six months ended 30 September 2017.

Six months ended 30 September 2017 - unaudited

Continuing

Managed Services
£000

Software Solutions
£000

 

Central

£000

 

Total

£000

Revenue

4,957

5,828

-

10,785

Operating profit/(loss) before amortisation of intangibles assets and management charge

 

1,464

985

(594)

1,855

Amortisation of acquired intangibles

(484)

(1,000)

(18)

(1,502)

Management charge

(607)

(204)

811

-

Operating profit /(loss)

373

(219)

199

353

Finance income

9

1

6

16

Finance costs

-

(25)

(160)

(185)

Profit/(loss) before tax

382

(243)

45

184

Adjusted EBITDA*

1,551

1,371

(662)

2,260

 

 

Assets and liabilities

 

 

 

 

Segment assets

11,427

29,384

(2,202)

38,609

 

Segment liabilities

(2,933)

(12,206)

(7,163)

(22,302)

 

Net assets / (liabilities)

8,494

17,178

(9,365)

16,307

 

*Earnings for the period from continuing operations before net finance costs, tax, depreciation, amortisation, exceptional items, group management charges and share based payment charges.

 

Six months ended 30 September 2016 - unaudited

Continuing

Managed Services
£000

Software Solutions
£000

 

Central

£000

 

Total

£000

Revenue

4,619

       5,106

-

       9,725

Operating profit/(loss) before amortisation of intangibles assets and management charge

 

1,416

1,064

(777)

1,703

Amortisation of acquired intangibles

(485)

(984)

-

(1,469)

Management charge

(617)

(46)

663

-

Operating profit /(loss)

314

34

(114)

234

Finance income

10

-

1

11

Finance costs

-

(5)

(201)

(206)

Profit/(loss) before tax

324

29

(314)

39

Adjusted EBITDA*

       1,476

1,143

(593)

       2,026

 

Assets and liabilities

 

 

 

 

Segment assets

           

12,572

28,688

              116

            41,376

 

Segment liabilities

(3,628)

(12,638)

    (9,724)

    (25,990)

 

Net assets / (liabilities)

8,944

16,050

(9,608)

15,386

 

*Earnings for the period from continuing operations before net finance costs, tax, depreciation, amortisation, exceptional items, group management charges and share based payment charges.

 

3.     Exceptional costs

 In accordance with the Group's policy in respect of exceptional costs the following charges were incurred:

 

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March 2017

 

£000

£000

£000

Integration and strategic costs

-

71

278

Acquisition and reorganisation costs:

-

36

448

Creation of restructuring provision

-

-

15

Restructuring costs

133

-

-

Waiver of Opus loan note

(215)

-

-

Creation of provision in respect of onerous Opus contracts

215

-

-

 

133

107

741

 

Restructuring costs relate to closure of the scanning bureau in the period.

On 21 June 2017, it was agreed by the beneficiaries of the Opus loan notes issued at the time of the company's acquisition of Opus Information Technology Limited that they would waive the remaining £0.2 million of loan notes in consideration of surrendering any potential warranty claims for onerous contracts under the sale and purchase agreement.

During the 6 months ended 30 September 2017, a provision was created in respect of onerous contracts associated with the acquisition of Opus Information Technology Limited.

 

 

 

4.     Taxation

Tax on profit on ordinary activities

 

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March 2017

 

£000

£000

£000

Corporation Tax

 

 

 

Current tax on profit / (loss) for the year

-

-

(571)

Deferred tax

 

 

 

Origination and reversal of timing differences                               

(442)

(290)

(431)

Changes in rates of tax

-

(299)

-

Total tax credit

(442)

(589)

(1,002)

 

The rate of UK corporation tax for the year beginning 1 April 2017 is 19% (year beginning 1 April 2016 it was 20%). From the year starting 1 April 2020 the UK corporation tax rate drops to 17%. Deferred tax has been measured on the basis of these rates and reflected in the financial statements.

 

5.     Earnings per share

Basic earnings per share and diluted earnings per share are calculated using a weighted average number of shares of 78,714,832 and 82,919,847 respectively (30 September 2016: weighted average number of shares of 78,204,586 and 86,743,592 respectively and at 31 March 2017: weighted average number of shares of 78,339,832 and 86,215,879 respectively).

Adjusted diluted EBITDA* per share has been shown on the grounds that it is a common metric used by the market in monitoring similar businesses.

 

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March 2017

 

Basic and diluted earnings per share:

 

 

 

Basic earnings per share

0.80p

0.80p

0.59p

Fully diluted                                                                                 

0.75p

0.72p

0.54p

Adjusted diluted EBITDA* per share                                                                              

2.73p

2.32p

5.08p

 

 

*Earnings for the period from continuing operations before net finance costs, tax, depreciation, amortisation, exceptional items and share based payment charges.

 

 

 

6.     Trade and other payables

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March 2017

 

£000

£000

£000

Current

 

 

 

Trade payables

653

1,011

298

Other payables

100

291

67

Taxation and social security

502

680

646

Accruals

1,063

680

1,180

Deferred income

6,293

5,992

6,645

 

8,611

8,654

8,836

Non current

 

 

 

Deferred income

1,414

1,430

1,718

Accrued interest

285

-

175

 

1,699

1,430

1,893

 

 

7.     Net cash flows from operating activities

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March 2017

 

£000

£000

£000

Profit/(loss) on ordinary activities before tax

184

39

(539)

Adjustments for:

 

 

 

Exceptional items

133

404

797

Net finance costs

169

195

727

Depreciation of property, plant and equipment

129

123

225

Amortisation of intangible assets

1,502

1,469

2,997

Equity-settled share based payment charge

143

93

231

Movements in working capital:

 

 

 

Decrease in trade and other receivables

518

661

1,514

Decrease in provisions

(101)

(208)

(558)

Increase/(decrease) in trade and other payables

332

(975)

(1,235)

(Decrease)/increase in deferred income

(656)

(224)

285

(Increase)/decrease in inventories

(22)

174

137

Cash generated from operations before exceptional items

2,331

1,751

4,581

 

 

 

8.     Net debt

 

Unaudited six months ended 30 September 2017

Unaudited six months ended 30 September 2016

Audited year ended 31 March 2017

 

£000

£000

£000

Cash

571

644

586

Overdraft

(215)

(994)

(316)

Barclays Loan

(3,750)

(4,777)

(4,250)

Mortgage (Documotive)

(104)

(113)

(110)

Net debt before loan notes and deferred/contingent consideration

(3,498)

(5,240)

(4,090)

Loan notes and accrued interest on loan notes*

(2,638)

(3,681)

(3,272)

Net debt before deferred/contingent consideration

(6,136)

(8,921)

(7,362)

Deferred consideration:

(1,144)

(1,554)

(1,545)

Contingent consideration:

(748)

(619)

(748)

Net debt

(8,028)

(11,094)

(9,655)

 

* Accrued interest on loan notes is presented within "Accrued Interest" in Trade and other payables.
 

Advisers

Nominated Adviser and Broker

FinnCap, 60 New Broad Street London, EC2M 1JJ

 

Financial Adviser

MXC Capital Limited, 25 Victoria Street, London SW1H 0EX

 

Auditors

RSM UK Audit LLP, Portland, 25 High Street, Crawley, West Sussex, RH10 1BG

 

Solicitors

Beachcroft LLP, 100 Fetter Lane, London, EC4A 1BN

 

Registrars

Link Asset Services, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU

 

Principal Bankers

Barclays Bank plc, 1 Churchill Place, London, E14 5HP

 

Company Number

03336134

Further details can be found on the Castleton website at the following address: www.castletonplc.com

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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