Interim Results
November 23 2006 - 2:01AM
UK Regulatory
RNS Number:5538M
Business Systems Group Hldgs PLC
23 November 2006
23 November 2006
Business Systems Group Holdings plc ("BSG" or the "Group")
Interim results for the six months ended 30 September 2006
Business Systems Group Holdings plc, the managed services provider which
designs, deploys and operates a range of information technology products,
solutions and services, today announces interim results for the six months ended
30 September 2006.
Contacts:
BSG Tel: 020 7880 8888
Nick Gerard, Group Chief Executive
James Wheaton, Group Finance Director
CHAIRMAN'S STATEMENT
I am pleased to present the results for the Group for the six months ended 30
September 2006.
At the year end, I noted the impact of the non-renewal of a significant contract
with the result being that the Group would fall into loss this financial year.
This has happened, with the business delivering a loss of #405k in the first six
months, in line with expectations. The Group has nevertheless made good progress
in replacing these lost contractual revenues, especially in the Managed Services
arena, which is key to the Group's plan to re-build profitability. During the
period, the Group achieved a net increase of #800k in the annualised value of
contractual revenues and maintained its strong cash position with a cash balance
of #8.1m at the half year end.
The key points to note for the period were:
* In the first six months of the year, the Group produced an operating
loss of #612k compared with an operating profit of #286k in the
corresponding period of the prior year. The loss before tax was #405k, down
from a profit of #490k in the same period of the prior year.
* Revenues fell by 14% from #18.8m to #16.2m. Revenues fell year on year
in the first quarter due to the exceptionally strong performance last year.
The second quarter showed growth of 8%, despite the aforementioned contract
loss.
* Contractual revenues have grown to an annualised #6.4m as at September
2006, from an annualised #5.6m at March 2006, an increase of #800k.
* The Group's balance sheet remains strong with #8.1m cash and no debt.
This compares with #8.7m of cash a year ago. During the six months the Group
has paid #234k for the final dividend for last year and #707k in respect of
share buy-backs.
* The Solutions business, which develops and supports software
applications, has benefited from the cost reductions made in February. As a
result the business has generated a profit for the six months.
The Board does not recommend that an interim dividend be paid.
Outlook
The Group remains committed to its stated strategy of growing contractual
revenues, and Managed Services in particular. Following the success in growing
these revenues in the first six months the Board will be aiming for similar
increases in the second half.
Roger Keenan
Chairman
22 November 2006
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Unaudited Unaudited Audited
Six months to Six months to Year ended
30 September 30 September 31 March
2006 2005 2006
(as restated (as restated
per note 1) per note 1)
Notes #'000 #'000 #'000
----------- ---------- -----------
Turnover 3 16,187 18,800 34,639
Cost of sales (13,666) (15,504) (28,282)
----------- ---------- -----------
Gross profit 2,521 3,296 6,357
Net operating expenses (3,133) (3,010) (6,002)
----------- ---------- -----------
Operating
(loss)/profit 3 (612) 286 355
Net interest receivable 207 204 412
----------- ---------- -----------
(Loss)/profit on ordinary (405) 490 767
activities before taxation
Taxation - - -
----------- ---------- -----------
(Loss)/profit on ordinary
activities after taxation
and retained (loss)/profit (405) 490 767
----------- ---------- -----------
Basic (loss)/earnings
per share 5 (0.54)p 0.60p 0.94p
Diluted earnings per
share 5 - 0.59p 0.90p
----------- ---------- -----------
There are no recognised gains or losses other than the (loss)/profit for the
current and preceding financial periods. Accordingly no statement of total
recognised gains and losses is presented.
CONSOLIDATED BALANCE SHEET
Unaudited at Unaudited at Audited at
30 September 30 September 31 March
2006 2005 2006
(as restated (as restated
per note 1) per note 1)
#'000 #'000 #'000
---------- ---------- ----------
Fixed Assets
Tangible assets 1,260 978 1,052
---------- ---------- ----------
1,260 978 1,052
---------- ---------- ----------
Current Assets
Stock 159 82 87
Debtors 5,283 5,408 6,209
Cash at bank and in
hand 8,115 8,715 9,252
---------- ---------- ----------
13,557 14,205 15,548
Creditors
Amounts falling due
within one year (7,285) (6,429) (7,697)
---------- ---------- ----------
Net Current Assets 6,272 7,776 7,851
---------- ---------- ----------
Total Assets less
Current Liabilities 7,532 8,754 8,903
Provision for
Liabilities and
Charges (148) (247) (193)
---------- ---------- ----------
Net Assets 7,384 8,507 8,710
---------- ---------- ----------
Capital and Reserves
Called up share
capital 3,742 4,209 4,159
Capital redemption
reserve 467 - 50
Profit and loss
account 3,350 4,531 4,691
EBT reserve (175) (233) (190)
---------- ---------- ----------
Shareholders' Funds 7,384 8,507 8,710
---------- ---------- ----------
RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS
(Loss)/profit for the period (405) 490 767
Decrease in EBT reserve 15 141 184
Loss on EBT redemptions (4) (30) (39)
Dividends (234) (245) (245)
Purchase of own shares (707) - (114)
Share-based payment 9 9 15
-------- ---------- ----------
Net (reductions)/additions to shareholders' (1,326) 365 568
funds
Opening shareholders' funds 8,710 8,142 8,142
-------- ---------- ----------
Closing shareholders' funds 7,384 8,507 8,710
-------- ---------- ----------
CONSOLIDATED CASH FLOW STATEMENT
Unaudited Unaudited Audited
Six months to Six months to Year ended
30 September 30 September 31 March
2006 2005 2006
Notes #'000 #'000 #'000
----------- ----------- -----------
Net cash inflow/(outflow) from
operating activities 7 11 (157) 502
----------- ----------- -----------
Returns on investments and
servicing of finance: 207 204 412
Net interest received
----------- ----------- -----------
Net cash inflow from returns
on investments and servicing
of finance 207 204 412
----------- ----------- -----------
Capital expenditure and
financial investment:
Purchase of tangible fixed
assets (427) (127) (377)
Sale of tangible fixed assets 2 - -
----------- ----------- -----------
Net cash outflow from capital
expenditure and financial
investment (425) (127) (377)
----------- ----------- -----------
Acquisitions and disposals:
Consideration for acquisitions - (70) (70)
----------- ----------- -----------
Net cash outflow for
acquisitions - (70) (70)
Dividends paid (234) (240) (240)
----------- ----------- -----------
Cash (outflow)/inflow before
management of liquid resources
and financing (441) (390) 227
Financing:
Sale of shares from EBT 11 111 145
Purchase of own shares (707) - (114)
----------- ----------- -----------
(Decrease)/increase in cash in
the period 8, 9 (1,137) (279) 258
----------- ----------- -----------
NOTES
1. Basis of Preparation
The interim results which are unaudited, have been prepared in accordance with
applicable United Kingdom accounting standards using accounting policies
consistent with those set out in the accounts for the year ended 31 March 2006,
with the exception of the adoption of FRS20 "Share-based payment". A charge
arises in respect of the fair value of share options, and comparative figures
have been restated in accordance with this standard.
The financial information for the six months ended 30 September 2006 and 30
September 2005 has been neither audited nor reviewed and does not constitute
statutory accounts as defined in section 240 of the Companies Act 1985.
The financial information for the year ended 31 March 2006 has been extracted
from the statutory accounts for that period which have been filed with the
Registrar of Companies. The auditors' report on those accounts was unqualified
and did not contain any statement under section 237(2) or (3) of the Companies
Act 1985.
The interim results for the six months ended 30 September 2006 were approved by
the Board of Directors on 22 November 2006.
2. Basis of Consolidation
The Group accounts incorporate the results of the Company and its subsidiaries,
Business Systems Group Limited and Webgenerics Limited.
3. Analysis of turnover, operating (loss)/profit and net assets
The Group operates in one principal activity, that of the provision of
integrated technology solutions, products and services. The activity is wholly
undertaken in the United Kingdom.
4. Dividend
No interim dividend will be paid in respect of the six month period ending 30
September 2006 (2005: nil).
5. (Loss)/earnings per share
Basic (loss)/earnings per share has been calculated by dividing the (loss)/
profit on ordinary activities after taxation by the weighted average number of
ordinary shares in issue during the period.
Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares in issue on the assumption of conversion of all
dilutive potential ordinary shares. The Group has only one category of dilutive
potential ordinary shares, those share options granted under the Enterprise
Management Incentive Plan. When a loss is incurred, since the conversion of
potential Ordinary shares to Ordinary shares would decrease net loss per share,
options are not dilutive and therefore diluted and basic losses per share are
the same.
Unaudited Unaudited Audited
Six months to Six months to Year ended
30 September 30 September 31 March
2006 2005 2006
(as restated (as restated
per note 1) per note 1)
(Loss)/profit for the
financial period and
basic and diluted
earnings attributable
to ordinary shareholders
(#'000) (405) 490 767
---------- ---------- ----------
Weighted average
number of ordinary
shares ('000) 75,556 80,994 81,427
Effect of dilutive
share options ('000) 2,077 2,217 3,867
---------- ---------- ----------
Adjusted weighted
average number
of ordinary
shares ('000) 77,633 83,211 85,294
---------- ---------- ----------
Basic (loss)/earnings
per share (0.54)p 0.60p 0.94p
Diluted earnings per
share - 0.59p 0.90p
---------- ---------- ----------
6. Copies of Report
The interim report will be mailed to shareholders and copies will also be
available at the Company's registered office at 226 - 236 City Road, London,
EC1V 2TT.
7. Reconciliation of operating (loss)/profit to cash inflow/(outflow) from
operating activities
Unaudited Unaudited Audited
Six months to Six months to Year ended
30 September 30 September 31 March 2006
2006 2005
(as restated (as restated
per note 1) per note 1)
#'000 #'000 #'000
---------- ---------- ----------
Operating
(loss)/profit (612) 286 355
Depreciation of
tangible assets 215 177 352
Share-based payment 9 9 15
Amortisation of
intangible assets - 29 30
Loss on disposal of
tangible assets 2 - 1
Decrease in
provisions (45) (70) (124)
(Increase)/decrease
in stock (72) 110 105
Decrease in debtors 926 1,723 922
Decrease in creditors (412) (2,421) (1,154)
---------- ---------- ----------
Net cash
inflow/(outflow) from
operating activities 11 (157) 502
---------- ---------- ----------
8. Analysis of Net Funds
Audited at Unaudited Unaudited at
1 April 2006 Cash flows 30 September
2006
#'000 #'000 #'000
---------- ---------- ----------
Cash at bank and in hand 9,252 (1,137) 8,115
---------- ---------- ----------
Net funds 9,252 (1,137) 8,115
---------- ---------- ----------
9. Reconciliation of net cash flow to movement in net funds
Unaudited Unaudited Audited
Six months to Six months to Year ended
30 September 30 September 31 March
2006 2005 2006
#'000 #'000 #'000
---------- ---------- ----------
(Decrease)/increase in cash in
the period (1,137) (279) 258
Net funds at start of the period 9,252 8,994 8,994
---------- ---------- ----------
Net funds at end of the period 8,115 8,715 9,252
---------- ---------- ----------
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR UURBRNVRAUAA
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