TIDMIMTK
RNS Number : 0406T
Imaginatik PLC
15 July 2015
15 July 2015
Imaginatik Plc
("Imaginatik" or the "Company")
Final Results
Imaginatik plc (AIM: IMTK.L), the world's first full service
innovation provider offering a range of consultancy and technology
products, is pleased to announce its audited results for the year
ended 31 March 2015.
With its unique technology and consulting expertise, Imaginatik
enables organisations to build actual solutions and actionable
plans to develop a sustainable and organisation-wide innovation
strategy in order to compete in the rapidly changing,
information-rich 21(st) century.
Financial Highlights
-- Recognised revenue increased by 15% GBP3.34m (FY14: GBP2.9m)
-- Deferred revenue decreased by 4% GBP2.90m (FY14: GBP3.03m)
-- Annualised Renewals increased by 29% to GBP3.1m (FY14: GBP2.4m)
-- Gross bookings decreased by 14% to GBP3.18 (FY14: GBP3.44m)*
-- Loss after tax decreased by 9% GBP1.46m (FY14: GBP1.61m)
-- Placing of and subscription for new shares in the year raised
a total of GBP1.29m before expenses
Operational Highlights
-- Appointment of Ralph Welborn as CEO who joined the Company in December 2014
-- The client base increased by 21 over the year, 12
predominantly blue chip international clients on annual contracts,
secured across a wide range of sectors:
- Investment Management
- Biotechnology
- Media Services
- Retail
- Construction Equipment
- Higher Education
-- Total client base increased to 42 with 26 now on multi-year contracts
-- Sales pipeline increased by 13% on a like-for-like basis to
GBP8.22m in March 2015 (March 2014: GBP7.28m)*
-- Continued investment in the expansion of Imaginatik's consultancy and technology offerings
* At constant currency, exchange rate of 1.5383.
Ralph Welborn, Chief Executive Officer of Imaginatik, commented,
"I am delighted to have joined Imaginatik at such a pivotal moment
in the Company's development. The plan to reposition Imaginatik as
a global full service innovation provider is seeing satisfactory
progress, as highlighted by the number of new clients and the
growth of our sales pipeline. The first six months since I joined
have been spent getting to know the business, our employees and our
client base and I am confident that we have a clear plan to take
the company forward and build quickly on the progress made so
far."
Matt Cooper, Non-Executive Chairman of Imaginatik, added, "The
operational and financial performance of the Company in the period
has been encouraging but we recognise that we can do better. We are
committed to delivering an improved performance and value for our
shareholders in the future. The uniqueness of our product offering
and our commitment to helping our clients develop an effective
innovation strategy is key to the growth in our client base. The
diversity and breadth of industries seeking our services convinces
the Board that we are on the right track."
For further information please contact:
Imaginatik plc Tel: 01329
243 243
Matt Cooper Non-Executive Chairman
Ralph Welborn, CEO
Shawn Taylor, CFO
finnCap Ltd Tel: 020
7220 0500
Stuart Andrews / Giles Rolls
Daniel Stewart & Company Tel : 020
7776 6550
Martin Lampshire / David Coffman
Newgate Tel: 020
7653 9850
Adam Lloyd / Ed Treadwell /
Andre Hamlyn
About Imaginatik
Imaginatik provides a range of Innovation solutions comprised of
consultancy, enterprise software and program management to deliver
innovation results to organisations such as The World Bank, The
Chubb Group of Insurance Companies, Exxon Mobil, Altria, Shell,
Mayo Clinic, Goodyear, the Yorkshire Building Society, Pitney Bowes
and Cargill. Few organisations possess the internal capability to
consistently generate fresh ideas, identify those worth pursuing
and reliably transform them into real, value-enhancing assets.
Imaginatik's mission is to help these organisations build
sustainable innovation competencies.
Imaginatik is a public company whose shares are traded on the
AIM market of the London Stock Exchange (LSE:IMTK.L) and is a World
Economic Forum Technology Pioneer with offices in Boston, MA, and
Fareham, UK. For more information visit www.imaginatik.com
Chairman's statement
On 1 December 2014 Ralph Welborn joined Imaginatik as our Chief
Executive Officer who is based in Boston, USA. The Board is
delighted that Ralph's appointment has had an immediate impact,
benefiting both the strategy and direction of the Company. With his
senior consulting background, Ralph is helping elevate
conversations within the existing and prospective client bases, in
addition to assisting the sales and consulting teams demonstrate
that Imaginatik's services encompass substantially more than that
of a pure technology vendor.
Our client base continues to grow in number and value,
demonstrating the Company's progress in repositioning itself as a
global full service innovation provider. We have achieved this
growth through our expanded consultancy offerings, our growing
sales capability, our client retention rates and through our range
of proprietary technology products.
Our operational marketplace continues to expand with the sector
coverage by industry analysts also increasing as a response to
their clients seeking to further understand the innovation
marketplace and how innovation can be institutionalised within
their organisations. As recently as five years ago, the notion that
large corporations would have a C-level officer devoted to
innovation was not credible. This growing category of senior
executives now have a title, Chief Innovation Officer (CINO), and a
rising slate of conferences, publications, and services are
targeting them. Over 40% of the Forbes Global 2000 now have a CINO
or a close equivalent.
As we highlighted in the shareholders circular issued on 14th
May 2015, the financial year ended 31 March 2016 contains a
significant number of client renewals. Whilst only a few of these
have so far reached their renewal date, we have confirmed five
renewals and two small losses, one of which was anticipated. All
others are progressing well and we shall update on their progress
throughout the year.
The operational and financial performance of the Company in the
period has been encouraging but we recognise that we can do better.
We are committed to delivering an improved performance and value
for our shareholders in the future. The uniqueness of our product
offering and our commitment to helping our clients develop an
effective innovation strategy is key to the growth in our client
base. The diversity and breadth of industries seeking our services
convinces the Board that we are on the right track
Matt Cooper
Non-Executive Chairman
14 July 2015
Strategic Report
Operational Review
Over the last three years our strategy has been to reposition
Imaginatik as a global full service innovation provider, utilising
our unique and extensive consultancy and technology offerings. In
service of that objective, we have continued to invest in all of
our core competencies; consultancy, technology, sales and
marketing.
Consultancy
We see the provision of consultancy services as Imaginatik's key
differentiator from our, competitors, who are primarily technology
based. Consequently, we have been intensely focused on developing
our consultancy offerings to ensure we make the most of this
opportunity to establish and consolidate Imaginatik as a leading
global full service innovation provider.
Our consulting services are provided under two broad categories
of Sustainable Innovation Competence and Innovation Pathways
Sustainable Innovation Competence leverages the complete set of
Imaginatik services and products by providing our clients with a
long term programme of building a lasting core competence for
innovation. In delivering this strategic objective for our clients,
the Innovation Governance service offering is particularly
invaluable as it ensures that a client's burgeoning innovation
programme develops healthy connections to overall corporate
strategy, while also building scaled enterprise processes and
helping to establish key metrics for innovation. Additionally we
offer other solutions that help clients to create a clear roadmap
as they begin the process of developing an effective innovation
strategy. These platforms help our clients determine what success
will look like, provide innovation maturity assessments relative to
their competitors, establish concept enhancement workshops and
install a range of training and skill development programmes.
Innovation Pathways - are discrete service lines that focus on
building our client's capabilities within a particular type of core
innovation process. In addition to our longstanding offering around
Idea Challenges, new offerings around Discovery Labs and Innovation
Communities allow us to offer early stage programmes and
engagements for a wider variety of new clients. Our success along
specific Innovation Pathways is a strong indicator of a client's
likelihood to subsequently sign up for Imaginatik's complete
Sustainable Innovation Competence programme of change. Within this
area we have seen particular success with our Discovery Labs and
Portfolio Valuation offers:
Discovery Labs
The Discovery Labs is a consulting engagement that is delivered
in conjunction with our Discovery Central software offering. The
objective is to encourage and enable our clients to think
radically, consider the impossible and seek to define future
opportunities and to remove practices that inhibit progress, no
matter how entrenched they may be. During the period under review,
we have sold this offering into six new and existing clients and
expect this to continue as our clients develop their strategic
thought processes and focus on the efficiencies they can
deliver.
Portfolio Valuation
More recently we have been working on a new offering of our
model for innovation portfolio valuation. This seeks to apply
various mathematical modelling and analytic techniques, including
the Monte Carlo Simulations, to generate a series of potential
valuations of a client's portfolio of innovation initiatives. In
doing this it will allow a greater focus on new business models,
address emerging markets and develop opportunities within new
investment and growth frontiers.
Our models enable us to isolate the relative importance of
specific projects or variables to investment success providing
visualisations of project dependencies and interconnectedness. A
study of these visualisations enables a greater focus on investment
strategies and success, notably capability building, timing of
investments and third party opportunities.
Technology
During the period we successfully released Version 12 of our
Innovation Central software platform, a new and significantly
enhanced version that incorporates various new features and
functionalities that have been developed in response to, and
alongside, our growing client base. In particular, we have invested
resources in developing several new analytic tools that enable end
users to further distil the very best ideas generated from idea
challenges to be taken forward as projects for use within their
businesses. We spent time further developing and enhancing
connectors that link Innovation Central to enterprise social
business applications, such as Jive, Yammer and Sharepoint,
streamlining the process for our clients to engage their employees
and, additionally, allowing corporate work streams to efficiently
pass from one platform to the other. All of these developments will
help increase the addressable market.
Development plans for the current year include a continuation of
our investment strategy supporting a series of decision making
support tools; these new tools aim to help clients action their
ideas within current and prospective projects. We will also be
developing further refinements to our portfolio valuation tools in
response to the considerable interest expressed by our existing and
prospective clients.
Sales and Marketing
Following significant work in previous years to carefully define
Imaginatik's core principles; innovation value proposition and the
central IP components of a refreshed brand position, these past 12
months have marked the first year of dissemination, success, and
refinement of that core message.
In terms of client development, the new positioning and packaged
offerings resulted in a noticeable increase in the level of
cross-selling of different products and services. Our account
managers have in many cases, already succeeded in moving client
relationships away from tactical point solutions and onto an
increasingly broad value proposition in-line with our new and
enhanced direction. New business development has also transitioned
to this unified "end to end innovation" sales message, away from
the traditional technology only message, thereby utilising new and
evolving methods for converting leads into prospects. This enhanced
approach is based on a more holistic understanding of innovation
management and how it can generate value for our clients.
Our marketing programmes focused on conferences, networking
events and the roll-out of Imaginatik's own prospecting seminars
and forums, recent locations of these include San Francisco, New
York, Chicago, Brussels and London. All of these programmes have
the purpose of convening senior-level decision makers around
strategic issues of innovation that align with Imaginatik's
refreshed brand positioning. This focus allowed us to field-test
the new messaging directly with target buyers and influencers. By
the second half of the year under review, these efforts funneled
into a redoubling of effort around email marketing, web content,
and online advertising. This has steadily built up a new set of
organisational habits for generating and developing sales leads and
starting to establish new foundations of brand equity within the
market.
The top priorities for the next year include new retainer
services agreements with dedicated Social Media and PR firms,
aiming to further amplify and disseminate our core brand position
and sales messages. In line with this added PR and Social Media
leverage, we are now increasing the cadence of high-end marketing
content production and our frequency of senior-level marketing
events.
Management and Key Personnel
In October 2014 the Company announced the appointment of Ralph
Welborn as CEO who joined the Company and the Board in December
2014. Ralph has spent his first few months meeting with many of our
key clients, better understanding their current and ongoing
requirements, and discussing Imaginatik's new rounded innovation
capabilities in addition to helping the sales team to develop
further senior relationships and generate sales momentum.
KPIs & Financial Review
The key performance indicators on which we judge the progress of
our business are as follows:
KPI 2015 2014
------------------------------- ----------- -----------
Number of new client wins
in the year 21 15
------------------------------- ----------- -----------
Total number of annual
contracts 42 33
------------------------------- ----------- -----------
Annualised value of renewals GBP3.1m GBP2.4m
------------------------------- ----------- -----------
Number of client renewing
their contracts 12/15 14/16
------------------------------- ----------- -----------
Gross bookings * GBP3.18m GBP3.72m
------------------------------- ----------- -----------
New & Upsell bookings GBP2.60 GBP2.45m
*
------------------------------- ----------- -----------
Renewal bookings * GBP0.58 GBP1.27
------------------------------- ----------- -----------
% of contracts signed
that include consultancy 56% 47%
------------------------------- ----------- -----------
Recognised revenue GBP3.34m GBP2.90m
------------------------------- ----------- -----------
Size of the sales pipeline GBP8.22m GBP7.28m
at year end *
------------------------------- ----------- -----------
Net result before exceptional (GBP1.46m) GBP(1.47m)
costs
------------------------------- ----------- -----------
* At constant currency, exchange rate of 1.5383.
We have seen a significant increase in new client wins with 21
secured during the course of the year, of which 12 are on annual
technology contracts and the remainder being consulting engagements
or pilot projects. Our new clients include an impressive array of
large global businesses, including sector representation across
financial services, pharmaceutical, aerospace, professional
services and manufacturing. By the period end we had 42 clients
(2014: 33) on annual or multi-year contracts, an increase of 28%
year-on-year. More importantly, the aggregate annualised value of
these contracts has increased to c. GBP3.1m, up 29% on the previous
period (2014: c. GBP2.4m). Client renewal rates in the last two
years have also been impressive, with 12 out of a possible 15
clients whose contracts came up for renewal choosing to renew in
the period. The growth in the aggregate value of our contracts and
our strong renewal rates gives the Board confidence that, as
greater proportion of the fixed cost base is covered by the
existing customer base, the Company's contracted revenue base will
be able to underpin the fixed cost base of the business in the long
term.
Gross bookings in the period ending 31 March 2015 were GBP3.18m
(2014: GBP3.72m), with GBP2.6m generated from new and upsell
business (2014: GBP2.45m), the balance of GBP0.58m came from the
available renewals (2014: GBP1.27m). The reduced level of gross
bookings relative to the prior year is a function of the
availability of renewals to the company, showing some volatility as
a result of the flow of multi-year contracts now in place. Of the
42 clients contracted at the period end, some 26 are on a
multi-year contract (2014: 22), with more than 30 available for
renewal in the next financial year.
Recognised revenues at GBP3.34m were up 14% on the prior year
(2014: GBP2.89m), with a skew towards the second half year as sales
momentum started to build with the addition of several new annual
contract wins as well as higher revenues generated from the
consulting division. We now have more of our contracts containing
some form of consulting component - 56% in this period versus 47%
in the comparable period. This is a modest diversification of our
revenue base, but in the longer term we believe it will help
further embed the Company's offerings within the client base.
Throughout the period contribution to revenues from our various
technology offerings amounted to 74% of total revenues (2014: 85%)
with a greater contribution now from consulting at 26% (2014:15%).
We see this as a steady state in terms of revenue mix for the
future. The US market again accounted for the largest element of
revenues, with 71% derived from that region (2014:77%) with a
growing contribution now from the Rest of World, which is primarily
the European market - 29% (2014:23%).
Our sales pipeline of all business opportunities continued to
grow in the period with a value at the year-end of approximately
GBP8.22m (2014:GBP7.28m).The sales pipeline now contains a greater
number of opportunities that contain a consulting component as we
demonstrate a wider footprint of capability to our client base.
Administrative expenses for the period were up 7% at GBP4.6m
(2014: GBP4.33m) as a result of recruiting and employing the new
CEO and GBP0.2m of FX losses (FY14: US$0.16m gain) as the US$
strengthened in the second half of the year. In 2014 there was an
FX gain of GBP0.16m. This resulted in a loss before tax of GBP1.58m
(2014: GBP1.71m). We were again successful in securing an R&D
tax credit from HMRC of GBP0.12m (2014: GBP0.1m), reflected in the
taxation line in the consolidated statement of comprehensive
income.
Cash outflows from operating activities was GBP1.03m (2014;
GBP1.35m), these outflows were met through the institutional fund
raisings undertaken in the period and the loan from Matt Cooper
both referred to below.
In May 2014 and October 2014 the Company undertook placings of
new ordinary shares with both new and existing shareholders raising
GBP1.29m after expenses. These funds were used to strengthen the
Company's financial position, providing reassurance to existing and
prospective new clients as to the Company's ability to continue to
provide and develop its software and range of consulting
services.
Subsequent to the period end, on 14 May 2015 the company
announced it had raised GBP0.5m before expenses by way of a
conditional placing.
The Company announced on 19 January 2015, that Matt Cooper had
agreed to lend to the Company the sum of US$250,000 which remained
in place at the period end, the loan attracts interest at 10% per
annum and has no fixed repayment date
In August 2014 the Company undertook a Share Capital
re-organisation, under which every 80 existing ordinary shares of
0.0625 pence each were consolidated into one new ordinary share of
5 pence each.
Summary and Outlook for 2016
We are pleased with much of the progress made in the year and
especially with how sales activity has picked up in the second half
of the financial year. We recognise however that in order to
continue this sales momentum there is a necessity to highlight
demonstrable success of Imaginatik's technology products and
consultancy offerings to the market. We enter the new financial
year with a pleasing pipeline of sales opportunities, accompanied
by an established sales team that is collectively focussed on
securing more new client wins and ensuring we are successful in our
efforts to renew all of our clients that are scheduled to renew in
the year ahead. As set out at the time of the fundraising in May
2015, we remain reliant on significant cash-flows from renewals
which are expected to occur later this year to provide the
necessary working capital for the Group.
The market in which we operate continues to be receptive to the
services and expertise that we offer and we are confident of
achieving the scale necessary to allow the business to move to a
breakeven position and ultimately into profitability.
Approved by the Board and signed on its behalf by:
Ralph Welborn
Chief Executive Officer
Shawn Taylor
Chief Operating and Financial Officer
14 July 2015
Imaginatik plc
Consolidated Statement of Comprehensive Income for the Year
Ended 31 March 2015
2015 2014
Note GBP 000 GBP 000
Revenue 3 3,336 2,899
Cost of sales (265) (261)
-------- --------
Gross profit 3,071 2,638
Administrative expenses (4,625) (4,328)
-------- --------
Operating loss (1,554) (1,690)
Finance costs (28) (24)
-------- --------
Loss before tax (1,582) (1,714)
Income tax receipt 119 105
-------- --------
Loss on ordinary activities
for the year and total comprehensive
income (1,463) (1,609)
======== ========
Loss per share - Basic and
diluted 5 2.46p 4.55p
======== ========
The above results were derived from continuing operations.
The group has no recognised income or expenses other than the
results for the year as set out above.
All of the above losses for the year are attributable to equity
holders of the parent.
Imaginatik plc
Consolidated Statement of Financial Position as at 31 March
2015
2015 2014
Note GBP 000 GBP 000
Assets
Non-current assets
Property, plant and equipment 35 26
Intangible assets 392 291
Trade and other receivables 330 329
-------- --------
757 646
-------- --------
Current assets
Trade and other receivables 1,666 1,614
Cash and cash equivalents 125 94
-------- --------
1,791 1,708
-------- --------
Total assets 2,548 2,354
======== ========
Equity and liabilities
Equity
Share capital 6 3,154 1,940
Share premium 6,480 6,405
Other reserves 1,076 967
Retained earnings (11,872) (10,409)
-------- --------
Equity attributable to owners
of the company (1,162) (1,097)
-------- --------
Non-current liabilities
Deferred income 851 1,079
Current liabilities
Trade and other payables 2,859 2,372
-------- --------
Total liabilities 3,710 3,451
-------- --------
Total equity and liabilities 2,548 2,354
======== ========
Imaginatik plc
Consolidated and Company Statement of Cash Flows for the Year
Ended 31 March 2015
2015 2014
Note GBP 000 GBP 000
Cash flows from operating activities
Loss for the year (1,463) (1,609)
Adjustments to cash flows
from non-cash items
Depreciation and amortisation 121 105
Share based payment transactions 109 124
Income tax credit (119) (105)
-------- --------
(1,352) (1,485)
Working capital adjustments
Increase in trade and other
receivables (53) (541)
Increase in trade and other
payables 259 568
-------- --------
Cash generated from operations (1,146) (1,458)
Income taxes received 119 105
-------- --------
Net cash flow from operating
activities (1,027) (1,353)
-------- --------
Cash flows from investing
activities
Acquisitions of property plant
and equipment (29) (18)
Acquisition of intangible
assets (202) (121)
-------- --------
Net cash flows from investing
activities (231) (139)
-------- --------
Cash flows from financing
activities
Proceeds from issue of ordinary
shares, net of issue costs 1,289 1,412
Proceeds from disposal of
treasury shares - 38
-------- --------
Net cash flows from financing
activities 1,289 1,450
-------- --------
Net increase/(decrease) in
cash and cash equivalents 31 (42)
Cash and cash equivalents
at 1 April 94 136
-------- --------
Cash and cash equivalents
at 31 March 125 94
======== ========
Imaginatik plc
Consolidated Statement of Changes in Equity for the Year Ended
31 March 2015
Share capital Share premium Other reserves Retained earnings Total Total equity
GBP 000 GBP 000 GBP 000 GBP 000 GBP 000 GBP 000
At 1 April 2013 528 6,405 843 (8,838) (1,062) (1,062)
------------- ------------- -------------- ----------------- -------- ------------
Employee share-based payment
options - - 124 - 124 124
Issue of share capital 1,412 - - - 1,412 1,412
------------- ------------- -------------- ----------------- -------- ------------
Transactions with owners 1,412 - 124 - 1,536 1,536
Purchase of own share capital - - - 38 38 38
Loss for the year and total
comprehensive income - - - (1,609) (1,609) (1,609)
------------- ------------- -------------- ----------------- -------- ------------
At 31 March 2014 1,940 6,405 967 (10,409) (1,097) (1,097)
============= ============= ============== ================= ======== ============
Share capital Share premium Other reserves Retained earnings Total Total equity
GBP 000 GBP 000 GBP 000 GBP 000 GBP 000 GBP 000
At 1 April 2014 1,940 6,405 967 (10,409) (1,097) (1,097)
------------- ------------- -------------- ----------------- -------- ------------
Employee share-based payment
options - - 109 - 109 109
Issue of share capital 1,214 75 - - 1,289 1,289
------------- ------------- -------------- ----------------- -------- ------------
Transactions with owners 1,214 75 109 - 1,398 1,398
Loss for the year and total
comprehensive income - - - (1,463) (1,463) (1,463)
At 31 March 2015 3,154 6,480 1,076 (11,872) (1,162) (1,162)
============= ============= ============== ================= ======== ============
Imaginatik plc
Notes to the Financial Statements for the Year Ended 31 March
2015
1. General information
The group headed by Imaginatik PLC is one of the leading
providers of collaborative innovation software and related
professional services to large and medium-sized enterprises.
The company is a public company limited by share capital
incorporated and domiciled in the UK.
The address of its registered office is:
22 Melton Street
London
NW1 2BW
The company's ordinary shares are traded on the Alternative
Investment Market (AIM) of the London Stock Exchange.
The company has adopted the requirements of International
Financial Reporting Standards (IFRS) and IFRIC interpretations
endorsed by the European Union (EU) and those parts of the
Companies Act 2006 applicable to companies reporting under IFRS.
The financial statements have been prepared under the historical
cost convention and are in accordance with applicable accounting
standards.
These financial statements have been prepared in accordance with
the accounting policies set out below, which have been consistently
applied to all the years presented. These accounting policies
comply with applicable IFRS and IFRIC interpretations issued and
effective at the time of preparing these statements.
2. Accounting policies
Going concern
The group posted a loss of GBP1,463,000 (2014: GBP1,609,000) for
the period, has current net liabilities of GBP1,068,000 (2014:
GBP664,000) and retained losses of GBP11,872,000 (2014:
GBP10,409,000). The group has net funds at 31 March 2015 of
GBP125,000 (2014: GBP94,000).
The group meets its financing requirements through the regular
placing of new shares and completed a placing of new ordinary
shares with institutional and other investors in May 2014 raising a
total of GBP1.29 million before expenses. The company completed a
further placing of new ordinary shares in October 2014, raising a
total of GBP75,000 before expenses. Subsequent to the period end,
on 14 May 2015 the company announced it has successfully raised
GBP0.5m before expenses by way of a conditional placing. During the
period the group also announced on 19 January 2015 that Matt
Cooper, Non-Executive Chairman, had agreed a loan of $250,000 which
remained in place at the period end, the loan attracts interest at
10% per annum and has no fixed repayment date.
The directors have prepared detailed group budgets and forecasts
for the period to March 2017. They have reviewed the group's
budgets and forecasts for the coming 12 months, which have been
prepared with appropriate regard to the current macroeconomic
environment and the conditions in the principal markets served by
the group. The directors have taken into consideration the group's
net funds, the level of anticipated renewals by reviewing on a
customer by customer basis, forecast new and up sell revenues based
on sales in the pipeline and anticipated costs. There's inherent
uncertainty in the level of anticipated renewals and up sell
revenues and assumptions are based on reasonable expectations
taking into account historic experience and current knowledge. The
forecasts include investments and additional costs commensurate
with expected levels of growth and options available to the
directors include the ability to flex these investments and costs
should predicted revenues be lower than forecast. The budget for
the coming 12 months includes the repayment of $250,000 loan. As a
result, at the time of approving the financial statements, the
Directors consider that the group has sufficient financial
resources to continue in operational existence for the foreseeable
future and, therefore, that it is appropriate to adopt the going
concern basis in preparing these financial statements. As with all
business forecasts, the directors' statement cannot guarantee that
the going concern basis will remain appropriate given the inherent
uncertainty about future events.
Basis of consolidation
The group financial statements for the year ended 31 March 2015
consolidate the financial statements of Imaginatik PLC and its
subsidiary undertaking using the acquisition method. Subsidiaries
are entities that are directly or indirectly controlled by the
group. Inter-company balances are eliminated on consolidation.
The company has taken advantage of the exemption under S408 of
the Companies Act 2006 and has not presented its own statement of
comprehensive income. Of the consolidated result for the year ended
31 March 2015 a loss of GBP1,487,000 (2014: loss of GBP1,630,000)
is attributable to the company.
Revenue recognition
Revenue is measured at the fair value of the consideration
received or receivable net of sales related taxes. Income for the
group is derived from two sources: Technology and Consultancy.
These sources are service-based rather than through the sale of
goods. Following the principles of IAS 18 Revenue, the policies for
income recognition in respect of each of the different sources of
income are such that income is recognised by reference to the stage
of completion of the transaction at the end of the reporting
period. In applying the income recognition policies below where
there is a requirement for a contract to be signed, income is
recognised in accordance with the policy when the contract has been
signed or persuasive evidence of an arrangement exists.
a) Consulting:
Income derived from our consulting offering subject to contracts
is recognised in the month in which the consulting takes place.
Income from longer term consulting arrangements shall be recognised
evenly over the term of the contract.
b) Technology:
The provision of our suite of technology products includes
provision of software licences, hosting and maintenance in relation
to the product over the contract term. Income arising from the
provision of these bundled services are recognised evenly over the
term of the contract, once an agreement has been signed or
persuasive evidence of an arrangement exists.
Critical judgements and significant accounting estimates
In determining and applying accounting policies, judgement is
often required in respect of items where the choice of specific
policy, accounting estimate or assumption to be followed could
materially affect the reported results or net asset position of the
Group should it later be determined that a different choice would
be more appropriate. The most significant areas where judgements
and estimates have been applied are as follows:
Judgements
The value of the awards under the modified and new share option
scheme was measured, in accordance with IFRS 2, by reference to
their fair value at the date on which they were granted. Judgement
was required in determining the most appropriate valuation model
(see Note 16).
Estimates
Significant assumptions were necessary in arriving at the inputs
into the valuation model for modified and new share option
scheme.
3. Segmental reporting
Management currently identifies the Group's two revenue streams
as its operating segments. These operating segments are monitored
by the Group's chief operating decision maker. For these operating
segments only revenues are reported the Group's chief operating
decision maker as results, other costs and assets and liabilities
cannot be reliably allocated to the operating segments.
2015 2014
GBP'000 GBP'000
Segmental revenue:
Technology 2,465 2,463
Consultancy 871 436
------- -------
3,336 2,899
======= =======
All other information presented to the Chief Operating Decision
Maker is the same as is reported in these financial statements.
The group's revenues from external customers and its non-current
assets are divided into the following geographical areas:
2015 2014
GBP'000 GBP'000
Segmental revenue:
United States of America 2,383 2,243
Rest of the World 953 656
------- -------
3,336 2,899
======= =======
Segmental non-current assets:
United States of America 314 189
Rest of the World 443 457
------- -------
757 646
======= =======
Revenues from external customers have been identified on the
basis of the customer's geographical location. Non-current assets
are allocated based on their physical location.
The group has one customer (2014: one customer), who accounted
for revenues of GBP357,000 (2014: GBP343,000), of which amount to
more than 10% of group revenues. These revenues arose in the
Technology segment.
4. Operating profit
Arrived at after charging / (crediting)
2015 2014
GBP 000 GBP 000
Depreciation expense 20 21
Amortisation expense 101 84
Research and development cost 182 226
Foreign exchange gains/(losses) 199 (158)
Operating lease expense - property 89 91
=================================== ====================================
Auditor's remuneration
2015 2014
GBP 000 GBP 000
Audit of these financial statements 22 21
Audit of the financial statements
of subsidiaries of the company
pursuant to legislation 1 1
----------------------------------- ------------------------------------
23 22
=================================== ====================================
Other fees to auditors
Taxation compliance services 5 5
All other non-audit services 3 3
----------------------------------- ------------------------------------
8 8
=================================== ====================================
Finance income and costs
2015 2014
GBP 000 GBP 000
Finance costs
Other finance costs 28 24
==================================== =================================
2015 2014
Income tax GBP 000 GBP 000
Tax charged/(credited) in the
income statement (119) (105)
=============================== ==================================
5. Earnings per share
During the year the company completed a share consolidation
converting its 4,908,980,456 ordinary shares of GBP0.000625 into
61,745,005 ordinary shares of GBP0.05. To enable a like-for-like
comparison the average shares used for the 2014 comparative have
been restated as though the share consolidation had been completed
on 1 April 2013.
The calculation of basic loss per share (EPS) is based on the
loss attributable to equity holders of the parent for the year of
GBP1,463,000 (2014: loss of GBP1,609,000) and a weighted average of
59,574,327 (restated 2014: 35,354,105) ordinary shares in
issue.
The share options issued during the current and prior year are
anti-dilutive due to losses, and therefore diluted EPS equals basic
EPS.
6. Share capital and reserves
Allotted, called up and fully paid shares
2015 2014
No. 000 GBP 000 No. 000 GBP 000
Ordinary shares
of 0.05p (2014
- 0.0625p) each 63,084 3,154 3,104,695 1,940
New shares allotted
During the year 24,275,606 ordinary shares having
an aggregate nominal value of GBP1,213,780 were
allotted for an aggregate consideration of GBP1,357,137.
Issue costs relating to the above placings were
GBP68,000 and have been deducted from the share
premium account.
Share premium account
This reserve records the consideration premium for shares issued
at a value that exceeds their nominal value, less any costs
incurred relating directly to the issue of these shares.
Other reserve account
This account acts as the share option reserve and records the
charges to profit with respect to unexercised share options.
Alloted, called up and fully paid shares
2015 2014
No. 000 GBP 000 No. 000 GBP 000
At 1 April 3,104,694,741 1,940 846,365,443 528
Issued in the year 24,275,606 1,214 2,258,329,298 1,412
Share consolidation (3,065,886,057) - - -
--------------- ------- ------------- -------
At 31 March 63,084,290 3,154 3,104,694,741 1,940
=============== ======= ============= =======
7. Non adjusting events after the financial period
The company announced on 14 May 2015 that it had successfully
raised GBP0.5m (before expenses) by way of a conditional Placing.
The terms of the Placing were described in a circular which was
despatched to shareholders of the Company on 14 May 2015. The
shares were admitted to trading on AIM on 2 June 2015.
8. Report and Accounts
Copies of the company's full statutory financial statements will
be available from the Company's place of business at Carnac
Cottage, Cams Hall Estate, Fareham, PO16 8UU and on its website,
www.imaginatik.com. A copy of the report and accounts will be sent
to all shareholders with notice of the AGM in due course.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR ZMGMNDDVGKZM
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