TIDMBRY
RNS Number : 0454Q
Brady plc
07 September 2017
7th September 2017
Brady PLC
("Brady", the "Company" or the "Group")
INTERIM RESULTS
For the six months to 30 June 2017
Brady plc, the leading global provider of trading, risk
management and settlement solutions to the energy, commodities and
recycling sectors, is pleased to announce its interim results for
the six months to 30 June 2017.
Operational Highlights
The business continues its transition from a one-off licence
revenue model to a recurring revenue model;
-- Four new licence deals signed on a recurring revenue basis in H1;
-- Two new energy licence deals signed following strategic
decision to build connectivity to the important renewables sector
via the Irish Single Integrated Market ("I-SEM");
-- Recurring revenue represented 68% of total sales in H1 (H1 2016: 60%).
Outlook
-- Full year results expected to be in line with market expectations;
-- Visibility over 93% of expected full year revenue; and
-- Cost base in line with management's expectations to the half year.
Financial Summary
(Unaudited) (Unaudited) (Audited)
6 months 6 months 12 months
to 30 June to 30 June to 31 Dec
2017 2016 2016
GBP'000 GBP'000 GBP'000
------------- ------------- ------------
Revenue 13,182 14,758 30,269
Recurring revenue 9,027 8,914 18,906
EBITDA before exceptional
items (880) 2,043 4,527
Operating result
before exceptional
items (2,902) 123 533
Dividend paid (pence nil nil nil
per share)
Adjusted earnings
per share (pence)
(1) (2.49) 1.05 2.40
Basic earnings per
share (pence) (3.97) (0.32) (2.23)
Cash 5,038 6,402 7,343
------------- ------------- ------------
(1) Adjusted earnings per share, as calculated by external
analysts, are based on the profit after tax adjusted for acquired
intangible assets amortisation, share based compensation,
exceptional items and normalised tax.
Ian Jenks, Executive Chairman, commented:
"We have continued to take actions this year to move the
business towards a solutions model focussed on growing recurring
revenue to improve the quality of our earnings. Brady successfully
secured a number of recurring revenue contracts during the period,
and I am pleased to report that recurring revenue now represents
68% of total sales.
Whilst our H1 results reflect the natural consequence of our
transition process away from the legacy licence model, the actions
we have taken in the first half of the year coupled with the
actions we will undertake in the second half will allow the
business to scale efficiently and deliver significant improvements
in profitability in 2018 and beyond.
With a high visibility of over 93% of our full year revenue and
control of our cost base we continue to expect full year results to
be in line with market expectations."
For further information please contact:
Brady plc
Ian Jenks, Executive Chairman Telephone: +44 (0)1223
Martin Thorneycroft, Chief 479479
Financial Officer
Cenkos Securities Telephone: +44 (0)20
Ivonne Cantu 7397 8900
Alex Aylen (sales)
Redleaf Communications Charlie Telephone: +44 (0)20
Geller Sam Modlin 7382 4730
About Brady
Brady plc (BRY.L) is the largest European-headquartered provider
of trading and risk management software to the global commodity and
energy markets. Brady combines fully integrated and complete
solutions supporting the entire commodity trading operation, from
capture of financial and physical trading, through risk management,
handling of physical operations, back office financials and
treasury settlement, for energy, refined, unrefined and scrap
metals, soft commodities and agriculturals.
Brady has 30 years' expertise in the commodity markets with some
400 customers worldwide, who depend on Brady's software solutions
to deliver vital business transactions across their global
operations. Brady clients include many of the world's largest
financial institutions, trading companies, miners, refiners and
producers, recycling companies, scrap processors, tier one banks
and a large number of London Metal Exchange (LME) Category 1 and 2
clearing members and many leading European energy generators,
traders and consumers.
For further information visit: www.bradyplc.com
Brady plc: Twitter/Facebook/LinkedIn
CHAIRMAN'S STATEMENT
2017 to date has been a year of necessary transition and as
expected there are some short term costs associated with this
transition.
At last year's Interim Results, Brady announced plans to review
its organisational structure in order to:
-- Improve earnings visibility by changing its focus from
one-off licence deals to a recurring revenue model;
-- Focus on expanding Brady's Energy products to the rest of
Europe though initiatives such as Irish Single Integrated Market
connectivity; and
-- Deliver products based on microservices supported by the Brady Framework
During the period, recurring revenue increased to GBP9.0 million
from GBP8.9 million, and I am pleased to report that recurring
revenue now represents 68% of total sales, with high visibility of
over 93% of our full year earnings. Reflecting the strategic
decision to focus on recurring revenue, one-off licence revenue
decreased to GBP0.9 million from GBP1.5 million in the prior
period, and service fees reduced to GBP3.2 million from GBP4.3
million.
The transition from upfront one-off fees to predictable
recurring revenue over the life of a contract means that, as we
anticipated, our results for the first half are down on the
previous period. During this year of transition, we expect that the
business's legacy seasonal weighting towards H2 will prevail but
that once transitioned the H1 and H2 split will be more evenly
weighted.
During the first half of the year market conditions have
continued to be challenging in the energy and commodity trading
sectors. This combined with our transition process means that our
profit before exceptional items and tax decreased by GBP3.0 million
to a loss of GBP2.9 million (from a profit of GBP0.1 million)
during the first half of the year. Adjusted EBITDA decreased from
GBP2.0 million to a GBP0.9 million loss, with GBP1.6 million of the
decrease attributable to the reduction in revenue to GBP13.2
million. A further GBP1.2 million is due to an increase in the cost
base resulting from weakness in Sterling in 2017 compared to the
corresponding period in 2016. Our loss before tax increased from
GBP0.1 million in H1 2016 to GBP3.5 million in H1 2017. Cash at 30
June 2017 was GBP5.0 million (2016 - GBP 6.4 million).
Recurring revenue contracts
Brady will receive GBP3.2 million over the life of four new
licence contracts thanks to the recurring revenue model now
implemented. Under the former one-off licence model, the revenue
recognised in H1 would have been approximately GBP1 million more
than reported. However, under the recurring revenue model Brady
will now benefit from a series of contracted payments over a number
of years from these deals. Brady recognised GBP0.1 million in
(mainly service) revenue in H1 and will recognise a further GBP0.6
million from these licence deals in H2 and GBP0.5 million annually
thereafter.
Energy products
Two of these four recurring revenue contracts were signed as a
result of our strategic decision to invest in our Energy products
and to increase our exposure to the renewables sector, and in
particular, building connectivity to the Irish Single Integrated
Market ("I-SEM"). One of these contracts was with a new customer,
and one is an existing customer. Brady expects to receive GBP1.4
million over the life of these contracts and will receive annual
recurring revenues of GBP0.23 million. Brady also secured recurring
revenue contracts for Commodity and Recycling products.
Microservices
During H1 we have discussed our new "microservices" strategy
with both clients and potential clients, and across both groups
there has been an overwhelming endorsement of the change. As a
result, we are holding three proof of concept trials in H2 using
microservices to optimise customer value utilising their data.
Organisational restructuring
We continued to strengthen the management team during H1 and
invested in our teams, in the optimal locations, to deliver on our
strategy and to allow the business to scale efficiently. During the
first half of the year, we were delighted to welcome Sara Mottus,
Head of Human Resources and Mark Gilliland, Head of Customer
Success to the Operating Board.
As a result of this organisational restructuring, Brady has
expensed GBP0.6 million of redundancy costs, legal costs and
consultant costs as an exceptional item.
Looking forward
As of today, 93% of the full year revenue target is either
contracted or is a renewal of an existing contract, leaving 7% to
be closed out by the year end. Our cost base is in line with
management's expectations to the half year and is expected to be in
line with market expectations for the full year.
FINANCIAL RESULTS
Group Revenues
Revenues by type
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Recurring support, maintenance
and rentals 9,027 8,914 18,906
Services including development 3,218 4,330 7,786
Software licences 937 1,514 3,577
------------- ------------- -----------
13,182 14,758 30,269
------------- ------------- -----------
Software licence sales at GBP0.9m were GBP0.6m less than the
same period last year. In H1 17, Brady signed four new licence
deals compared to ten deals in H1 16. This reflects timings of
renewals and the focus on recurring revenue as the business
strategy moves towards a Software as a Service model.
Recurring revenue for the period was GBP9.0m compared to GBP8.9m
in the prior period. Recurring revenue represents 68% of total
sales in H1 2017 (H1 2016: 60%).
Service and development fees were GBP3.2m compared to GBP4.3m in
the same period last year reflecting the lower level and timing of
new deals in 2017.
The impact of the strengthening of the Swiss Franc, US Dollar
and Norwegian NOK against Sterling on revenue was a positive
GBP1.2m.
Operating costs
Operating costs increased by GBP1.8m to GBP16.7m from GBP14.9m
in the same period last year. GBP1.2m of the increase is due to
strengthening of Swiss Franc, US Dollar and Norwegian NOK against
Sterling. The remaining increase is due to an increase in
exceptional items of GBP0.4m, an increase in amortisation of
GBP0.1m, an increase of GBP0.4m for other staff costs - mainly
contractors less an increase in capitalised development of
GBP0.4m.
Research and development expenditure represented 24 per cent
(GBP3.1m) of the Group's revenues in the first half of 2017
compared to 23 per cent (GBP3.4m) in the first half of 2016. This
is in line with the Group's commitment to ensuring that its product
offering is maintained and up-to-date. Of the above research and
development cost, GBP1.2m was capitalised (H1 16: GBP0.8m) and the
increase is due to focus on strategic developments with key
partners.
Profitability
Loss before taxation for the first half of 2017 was GBP3.5m
compared to GBP0.1m for the first half of 2016.
EBITDA for the first half of 2016 was a GBP0.9m loss compared to
GBP2.0m profit for the first half of 2016. The EBITDA margin for
the first half of 2017 was 7 per cent loss compared to 14 per cent
profit for the first half of 2016.
Basic earnings per share for the first half of 2017 was (3.97)
pence per share compared to an EPS of (0.32) pence per share for
the first half of 2016. Adjusted EPS was (2.49) pence per share,
down from 1.05 pence in H1 2016.
Balance Sheet
The balance sheet continues to be dominated by goodwill and
other intangible assets, largely as a natural consequence of the
completion of acquisitions in previous years. As the majority of
acquisitions were denominated in foreign currency, there is a
movement in carrying value of GBP1.1m between balance sheet dates
due to foreign exchange movements.
The Group continues to enjoy a strong balance sheet with net
cash balances at 30 June 2017 of GBP5.0m (H1 2016: GBP6.4m).
Cash Flow
Cash outflow from operations in H1 2017 was GBP0.9m compared to
a cash inflow of GBP1.0m for the same period in 2016.
Investing activities this year consisted of capitalised
development GBP1.2m (H1 2016: GBP0.8m) and fixed asset purchases of
GBP0.2m (H1 2016: GBP0.3m).
Consolidated interim statement of comprehensive
income
For the six months ended 30 June 2017
6 months 6 months 12 months
to 30 to 30 to 31
June 2017 June 2016 December
2016
(unaudited) (unaudited) (audited)
Notes GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Revenues 4 13,182 14,758 30,269
Operating costs 5 (16,691) (14,886) (30,895)
------------- ------------- -----------
Operating loss (3,509) (128) (626)
------------- ------------- -----------
Analysed as:
Revenue 13,182 14,758 30,269
Other operating
costs (14,062) (12,715) (25,742)
------------- ------------- -----------
Adjusted EBITDA (880) 2,043 4,527
------------- ------------- -----------
Exceptionals 10 (607) (251) (1,159)
Depreciation (317) (318) (678)
Amortisation of
acquired intangibles (826) (830) (1,718)
Amortisation of
other intangibles (879) (772) (1,598)
------------- ------------- -----------
Operating loss (3,509) (128) (626)
------------- ------------- -----------
Net finance income - 6 3
------------- ------------- -----------
Loss before tax (3,509) (122) (623)
------------- ------------- -----------
Income tax 210 (141) (261)
Exceptional income
tax 10 - - (969)
------------- ------------- -----------
Loss for the period
attributable to
shareholders of
Brady Plc (3,299) (263) (1,853)
------------- ------------- -----------
Other comprehensive
income
Exchange differences
on translation of
foreign operations (919) 3,997 5,566
Movement in actuarial
valuation of defined
benefit pension
schemes (10) (1,359) 10
------------- ------------- -----------
Total other comprehensive
income (929) 2,638 5,576
------------- ------------- -----------
Total comprehensive
income for the period (4,228) 2,375 3,723
------------- ------------- -----------
Earnings per share
(pence)
Basic 8 (3.97) (0.32) (2.23)
Adjusted diluted (2.49) 1.05 2.40
Consolidated interim statement of financial position
As at 30 June 2017
6 months 6 months 12 months
to 30 to 30 to 31
June 2017 June 2016 December
2016
(unaudited) (unaudited) (audited)
Notes GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Assets
Non-current assets
Intangible assets 11,12 34,535 34,393 35,999
Property, plant
and equipment 942 1,202 978
Deferred tax asset 56 555 58
------------- ------------- -----------
Total non-current
assets 35,533 36,150 37,035
------------- ------------- -----------
Current assets
Trade and other
receivables 6,949 8,312 7,297
Cash and cash equivalents 13 5,038 6,402 7,343
------------- ------------- -----------
Total current assets 11,987 14,714 14,640
------------- ------------- -----------
Total assets 47,520 50,864 51,675
------------- ------------- -----------
Liabilities
Current liabilities
Trade and other
payables (12,447) (12,103) (12,669)
------------- ------------- -----------
Total current liabilities (12,447) (12,103) (12,669)
------------- ------------- -----------
Non-current liabilities
Deferred income
tax liabilities (2,830) (2,854) (2,938)
Pension obligations (2,939) (3,944) (2,732)
------------- ------------- -----------
Total non-current
liabilities (5,769) (6,798) (5,670)
------------- ------------- -----------
Total liabilities (18,216) (18,901) (18,339)
------------- ------------- -----------
Net assets 29,304 31,963 33,336
------------- ------------- -----------
Equity
Share capital and
premium 38,120 37,907 37,930
Treasury shares 7 (3) (3) (3)
Other reserves (3,086) (3,212) (1,888)
Retained earnings (5,727) (2,729) (2,703)
------------- ------------- -----------
Total equity 29,304 31,963 33,336
------------- ------------- -----------
Consolidated interim statement of changes in equity
For the six months ended 30 June 2017
Share capital & Other equity Other reserves Retained earnings Total
premium
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------- -------------- ---------------- ------------------- ---------
Balance at 1
January
2016 37,883 (3) (7,297) (1,107) 29,476
Loss for the period - - - (263) (263)
Other
comprehensive
income
Movement in
actuarial
valuation of
defined
benefit pension - - - (1,359) (1,359)
Exchange difference
on translation
of foreign
operations - - 3,997 - 3,997
------------------- -------------- ---------------- ------------------- ---------
Total comprehensive
income - - 3,997 (1,622) 2,375
------------------- -------------- ---------------- ------------------- ---------
Reverse credit
for equity-settled
share based
payments - - 88 - 88
Issue of new share
capital 24 - - - 24
------------------- -------------- ---------------- ------------------- ---------
Transactions with
owners 24 - 88 - 112
------------------- -------------- ---------------- ------------------- ---------
Balance at 30
June 2016 37,907 (3) (3,212) (2,729) 31,963
------------------- -------------- ---------------- ------------------- ---------
Loss for the period - - - (1,590) (1,590)
Other
comprehensive
income
Movement in
actuarial
valuation of
defined
benefit pension - - - 1,369 1,369
Exchange difference
on translation
of foreign
operations - - 1,569 - 1,569
------------------- -------------- ---------------- ------------------- ---------
Total comprehensive
income - - 1,569 (221) 1,348
------------------- -------------- ---------------- ------------------- ---------
Reverse credit
for equity-settled
share based
payments - - 2 - 2
Transfer for
exercised
and forfeited
share options - - (247) 247 -
Issue of new share
capital 23 - - - 23
------------------- -------------- ---------------- ------------------- ---------
Transactions with
owners 23 - (245) 247 25
------------------- -------------- ---------------- ------------------- ---------
Balance at 31
December 2016 37,930 (3) (1,888) (2,703) 33,336
------------------- -------------- ---------------- ------------------- ---------
Loss for the period - - - (3,299) (3,299)
Other
comprehensive
income
Movement in
actuarial
valuation of
defined
benefit pension - - - (10) (10)
Exchange difference
on translation
of foreign
operations - - (919) - (919)
------------------- -------------- ---------------- ------------------- ---------
Total comprehensive
income - - (919) (3,309) (4,228)
------------------- -------------- ---------------- ------------------- ---------
Reverse credit
for equity-settled
share based
payments - - 6 - 6
Transfer for
exercised
and forfeited
share options - - (285) 285 -
Issue of new share
capital 190 - - - 190
------------------- -------------- ---------------- ------------------- ---------
Transactions with
owners 190 - (279) 285 196
------------------- -------------- ---------------- ------------------- ---------
Balance at 30
June 2017 38,120 (3) (3,086) (5,727) 29,304
------------------- -------------- ---------------- ------------------- ---------
Consolidated interim statement of cashflows
For the six months ended 30 June 2017
6 months 6 months 12 months
to 30 to 30 to 31 December
June 2017 June 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------------
Loss before tax (3,509) (122) (623)
Adjustments for:
Depreciation 317 318 678
Loss on disposal of - 6 -
property, plant & equipment
Amortisation of acquired
intangibles 826 830 1,718
Amortisation of other
intangibles 879 772 1,598
Share-based payment
charge 6 88 90
Finance income - (5) (3)
------------- ------------- -----------------
Operating cashflows
before working capital
movement (1,481) 1,887 3,458
Change in receivables 471 545 332
Change in payables 70 (1,316) (1,053)
------------- ------------- -----------------
Cash (used in) / generated
from operations before
tax (940) 1,116 2,737
Net income taxes paid (9) (163) (428)
------------- ------------- -----------------
Net cashflows from operating
activities (949) 953 2,309
------------- ------------- -----------------
Cashflows from investing
activities
Acquisition of subsidiaries,
net of cash acquired - (327) (326)
Purchase of property,
plant & equipment (204) (268) (612)
Expenditure on intangible
assets (1,234) (782) (1,555)
Interest received - 5 3
------------- ------------- -----------------
Net cashflows from investing
activities (1,438) (1,372) (2,490)
------------- ------------- -----------------
Cashflows from financing
activities
Proceeds from issue
of ordinary share capital 190 24 47
------------- ------------- -----------------
Net cashflows from financing
activities 190 24 47
------------- ------------- -----------------
Net decrease in cash
and cash equivalents (2,197) (395) (134)
------------- ------------- -----------------
Cash and cash equivalents
at start of period 7,343 6,594 6,594
Exchange differences
on cash and cash equivalents (108) 203 883
Cash and cash equivalents
at end of period 5,038 6,402 7,343
------------- ------------- -----------------
Selected explanatory notes
1. Nature of operations and general information
Brady plc and its subsidiaries' principal activity is the
provision of trading, risk management and settlement solutions to
the energy, metals, recycling and soft commodities industries,
through the delivery of client focused software and services.
The Group provides the leading trading and risk management
software for global commodity markets. The Group provides a
complete integrated solution supporting entire commodities trading
operations.
Brady plc, a public limited liability company, is the Group's
ultimate parent company. It is registered in England and Wales. The
address of Brady plc's registered office is Riverside House, 7(th)
Floor, 2A Southwark Bridge Road, London, SE1 9HA.
These condensed consolidated interim financial statements have
been prepared using the recognition and measurement principles of
International Financial Reporting Standards ("IFRS") as adopted by
the European Union and as issued by the International Accounting
Standards Board. They do not include all of the information
required for full annual financial statements as defined in Section
434 of the Companies Act 2006 and should be read in conjunction
with the Consolidated Financial Statements of the Group as at and
for the year ended 31 December 2016. The auditor's report on those
financial statements was unqualified and did not contain a
statement under Section 498(2) or Section 498(3) of the Companies
Act 2006. The consolidated financial statements have been filed
with the Registrar of Companies and are available on the Group's
website, www.bradyplc.com.
Brady plc's shares are listed on the London Stock Exchange's
AIM. Brady plc's consolidated interim financial statements are
presented in British pounds (GBP), which is also the functional
currency of the ultimate parent company.
2. Accounting policies
The accounting policies applied by the Group are the same as
those applied by the Group in its consolidated financial statements
as at and for the year ended 31 December 2016.
The accounting policies have been applied consistently
throughout the Group for the purposes of preparation of these
condensed consolidated interim financial statements.
3. Critical accounting judgements and key sources of estimation
uncertainty
The key assumptions concerning the future, and other key sources
of estimating uncertainty at the reporting date, that have a risk
of causing a material adjustment to the carrying values of assets
and liabilities within the next financial period are the same as
those applied by the Group in its consolidated financial statements
as at and for the year ended 31 December 2016.
4. Segment analysis reporting
Operating Segments
In accordance with IFRS 8, "Operating Segments", information for
the Group's business units has been derived using the information
used by the chief operating decision maker. The Executive Directors
have been identified as the chief operating decision makers and the
Board is responsible for the allocation of resources to business
units and assessing their performance.
In 2016, the Group was organised into 3 business units. However,
following the functional transformation of the business, the Group
has been organised into one business unit throughout H1 17 and
decisions by the chief operating decision maker have been made on
this basis.
Revenue by Geography
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
EMEA 8,979 9,906 20,241
Americas 3,652 4,208 8,375
APAC 551 644 1,653
------------- ------------- -----------
13,182 14,758 30,269
------------- ------------- -----------
The Group generates revenue from software licence sales,
recurring support and maintenance and rental fees and the provision
of associated consulting and development services. Revenues can be
analysed as below:
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Recurring support, maintenance
and rentals 9,027 8,914 18,906
Services including development 3,218 4,330 7,786
Software licences 937 1,514 3,577
------------- ------------- -----------
13,182 14,758 30,269
------------- ------------- -----------
5. Operating costs
Operating costs can be analysed as follows:
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Staff and related costs 11,158 9,919 18,433
Other operating costs 4,138 3,578 8,827
Capitalised development
costs (1,234) (782) (1,518)
Exceptionals 607 251 1,159
Depreciation 317 318 678
Amortisation 1,705 1,602 3,316
------------- ------------- -----------
16,691 14,886 30,895
------------- ------------- -----------
6. Share issues
The Company made various allotments of ordinary 1 pence shares
during the period on the exercise of various share options. This
increased the Company's ordinary shares issued and fully paid at
the end of the period by 285,000 (year ended 31 December 2016:
100,000).
7. Share buyback
During the period under review, the number of ordinary shares
held in treasury has remained at 4,306.
8. Earnings per share
The calculation of the basic earnings per share is based on the
profits attributable to the shareholders of Brady plc divided by
the weighted average number of shares in issue during the period.
All earnings per share calculations relate to continuing operations
of the Group. Separate calculations have been prepared related to
the profit before and after exceptional items.
Loss Weighted Basic
attributable average earnings
to shareholders number per share
GBP'000 of shares amount
in pence
------------------ ------------ ------------
6 months ended 30 June
2017 (3,299) 83,185,942 (3.97)
6 months ended 30 June
2017 before exceptional
items (2,692) 83,185,942 (3.24)
6 months ended 30 June
2016 (263) 83,011,302 (0.32)
6 months ended 30 June
2016 before exceptional
items (12) 83,011,302 (0.01)
Year ended 31 December
2016 (1,853) 83,029,599 (2.23)
Year ended 31 December
2016 before exceptional
items (694) 83,029,599 0.84
As there was a loss after tax for the six months ended June
2017, the six months ended June 2016 and the year ended December
2016, there was no dilutive effect.
The calculation of the adjusted earnings per share, as
calculated by external analysts, is based on the profit after tax
adjusted for acquired intangible assets amortisation, share based
compensation, exceptional items and normalised tax and is
calculated as follows:
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Loss for the year (3,299) (263) (1,853)
Add back:
Exceptionals 607 251 1,159
Amortisation of acquired
intangibles 826 840 1,718
Share-based payments 6 88 90
Tax charge (210) 141 1,230
Deduct:
Normalised tax charge
at 15% - (182) (352)
------------- ------------- -----------
Adjusted (loss) / profit (2,070) 875 1,992
------------- ------------- -----------
8. Earnings per share (continued)
Adjusted Weighted Basic
profit/(loss) average adjusted
attributable number earnings
to shareholders of shares per share
GBP'000 amount
in pence
------------------ ------------ ------------
6 months ended 30 June
2017 (2,070) 83,185,942 (2.49)
6 months ended 30 June
2016 875 83,011,302 1.05
Year ended 31 December
2016 1,992 83,029,599 2.40
9. Dividends
During the period Brady plc paid dividends of GBPnil to its
equity shareholders (period ended 30 June 2016: GBPnil).
10. Exceptional items
The table below shows the exceptional costs incurred during the
period.
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Acquisition costs relating
to energycredit - 251 253
Functional transformation
costs 607 - 626
Professional fees relating
to overseas tax enquiry - - 280
------------- ------------- -----------
Exceptional items charged
to operating profit 607 251 1,159
------------- ------------- -----------
Tax charge relating to
overseas tax enquiry - - 969
------------- ------------- -----------
Total exceptional items 607 251 2,128
------------- ------------- -----------
11. Goodwill
The net carrying amount of Group goodwill can be analysed as
follows:
Goodwill Purchased Total
on consolidation goodwill
GBP'000 GBP'000 GBP'000
------------------- ----------- ---------
Gross carrying amount 24,399 90 24,489
Accumulated impairment (3,816) (90) (3,906)
------------------- ----------- ---------
Carrying amount at 30
June 2017 20,583 - 20,583
------------------- ----------- ---------
Gross carrying amount 25,021 90 25,111
Accumulated impairment (3,327) (90) (3,417)
------------------- ----------- ---------
Carrying amount at 31
December 2016 21,694 - 21,694
------------------- ----------- ---------
There were no changes in the net carrying amount of purchased
goodwill. Changes in the net carrying amount of goodwill on
consolidation can be summarised as follows:
Total
GBP'000
-------
Carrying amount at 1 January 2017 21,694
Foreign exchange movement on retranslation (1,111)
-------
Carrying amount at 30 June 2017 20,583
-------
12. Other intangible assets
Intangible assets comprise the following:
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Capitalised development 6,591 6,179 6,309
Acquired software products 4,982 5,084 5,419
Acquired customer relationships 2,379 2,952 2,577
------------- ------------- -----------
13,952 14,215 14,305
------------- ------------- -----------
Changes in the net carrying amount of Group intangible assets
can be summarised as follows:
Capitalised Acquired Acquired Total
development software customer
costs products relationships
GBP'000 GBP'000 GBP'000 GBP'000
-------------- ----------- ---------------- ---------
Carrying amount
at 1 January 2017 6,309 5,419 2,577 14,305
Additions in the
period 1,234 - - 1,234
Amortisation in
the period (879) (574) (252) (1,705)
Forex movement
on retranslation (73) 137 54 118
-------------- ----------- ---------------- ---------
Carrying amount
at 30 June 2017 6,591 4,982 2,379 13,952
-------------- ----------- ---------------- ---------
13. Cash and cash equivalents
Cash and cash equivalents comprise the following:
6 months 6 months 12 months
to 30 to 30 to 31
June June December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------- ------------- -----------
Cash and cash equivalents 5,038 6,402 7,343
------------- ------------- -----------
14. Financial statements
The financial information for the year ended 31 December 2016
included in this interim report does not constitute statutory
accounts as defined in Section 434 of the Companies Act 2006. The
Group's statutory accounts for the year ended 31 December 2016 have
been filed with the Registrar of Companies. This statement can be
obtained from the Company's registered office at Riverside House,
7(th) Floor, 2A Southwark Bridge Road, London, SE1 9HA and are
available on the Company's website www.bradyplc.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LLFLAASIRIID
(END) Dow Jones Newswires
September 07, 2017 02:01 ET (06:01 GMT)
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