TIDMCLC
RNS Number : 3142F
Clinical Computing PLC
21 April 2011
CLINICAL COMPUTING PLC
2010 PRELIMINARY RESULTS
Clinical Computing Plc (the "Company" or the "Group"), the
international developer of clinical information systems and project
and resource management software, announces its preliminary results
for the year ended 31 December 2010. During 2010 the Group traded
through four operating subsidiaries: Clinical Computing UK Limited
in the United Kingdom and Europe, Clinical Computing, Inc. in the
United States, Clinical Computing Pty Limited in Australia and
Hydra Management Limited ("Hydra") in the United Kingdom and
Europe.
Financial Overview
-- Total revenue decreased 7% to GBP2,969,839 (2009:
GBP3,179,365)
-- Operating costs decreased 10% to GBP3,043,561 (2009:
GBP3,399,050)
-- Loss from operations reduced to GBP73,722 (2009:
GBP219,685)
-- EBITDA positive GBP70,152 (2009: loss of GBP61,118)
-- Profit after tax GBP181,291 (2009: profit GBP220,394)
-- Earnings per share of 0.2p (2009: 0.2p)
-- Operations generated GBP185,340 of cash (2009: operations
generated GBP219,502)
Business Review
-- Clinicalvision V cloud computing solution now available in
the US and Canada
-- Clinicalvision iPhone application released
-- Clinicalvision V live in four countries and two languages
(English and French)
-- Clinical analytics module in beta testing as part of Sussex
Renal Innovation Programme
-- Hydra revenues grew by 41% over prior year
-- Hydra has new customer references in marketing and support
service sectors
-- Hydra released new "what-if" planning solution in version
7.0
-- Significant development efforts completed in both
businesses
Commenting on Outlook, Howard Kitchner, Chairman of Clinical
Computing, said:
"We now have two businesses which, when taken together, are
capable of delivering improving results. In the Clinical business
we look forward to continuing to develop our relationship with
industry partners, enhancing our clinical applications to support
new geographic markets and extending our license base in our
traditional markets of the UK and US. The Hydra business has
delivered two consecutive years of revenue growth and we continue
to see growing demand for the Hydra products."
Contacts:
Clinical Computing plc http://www.ccl.com
Joe Marlovits, Chief Executive 020 3006 7536
Cairn Financial Advisers LLP 020 7148 7900
Simon Sacerdoti
James Caithie
Chairman's Statement
Business overview
I am pleased to report that the Group has produced its second
consecutive year of profitability with an after tax profit of
GBP181,291 (2009: GBP220,394) as well as its second consecutive
year of positive operating cash flow of GBP185,340 (2009:
GBP219,502).
This performance has been underpinned by consistent new sales
wins in the Hydra business, and revenues for this business unit are
up 41% from the prior year. In the Clinical business we have
re-aligned the cost base to focus around the clinicalvision
technology. This has resulted in a cost reduction of 18% in this
business unit and positions it to deliver improving results.
Clinical business
We now have nine organisations in four countries using the
clinicalvision web-enabled chronic disease software solution.
Additionally we expect to have another four customers using this
product by the end of June 2011. Clinicalvision is a web-enabled
electronic medical record solution that supports the management of
chronic disease with an emphasis on chronic kidney disease.
Clinicalvision can be licensed directly by our customers or
provided as a service via our "cloud computing" solution which is
now available in the US and Canada.
During 2010 the business released its first "App" which provides
clinicalvision users the ability to access patient information on
the iPhone and iPod Touch. This is the beginning of our mobile
device initiatives which we hope to expand as the "web" becomes
integrated in the delivery of healthcare information. As noted
above this business launched a "cloud computing" solution in Canada
and the US with three customers now using this service.
We have been invited by one of the UK's leading renal programmes
to participate, as the technology partner, in an innovative
research program to evaluate the effective use of technology to
support the multi-disciplinary care of patients with kidney
disease. The Sussex Renal Innovation Programme(SRIP) has been set
up to address the increasing complexity and cost involved in
managing and treating patients with chronic kidney disease. The
Department of Economics, University of Surrey will be modellingthe
before and after costs of care, which are intended to be shared
with other NHS organisations. As part of this project Clinical
Computing will be delivering its first version of cv-analytics, a
clinical analytics module aimed at identifying clinical risks
across patient groups.
From a marketing perspective, we continue to market directly to
customers in our traditional geographic markets (the United States
and the United Kingdom) and indirectly via Gambro in Canada and
Australia. Recently we won a new contract with a regional hospital
in Australia; and we continue to derive benefits from our close
working relationships with the Gambro sales teams in these
countries.
There are a number of government initiatives in the United
States, Canada and the United Kingdom that are driving innovation
in the electronic medical record market. These initiatives require
specific clinical data to be collected and reported to governmental
entities primarily to determine the quality of care and future
reimbursement and funding levels. This creates both risk and
opportunity for our business and we continue to adapt our solution
to meet the needs of each country and its specific regulations and
reporting requirements.
Hydra business
The Hydra software provides detailed management information
across a range of Key Performance Indicators ("KPI's") including
resource optimisation, programme and project status and financial
performance. The information generated by the Hydra software aids
decision making and maximises resource efficiencies within an
organisation.
Utilisation of the Hydra software enables fully automated
decision making as the data captured in Hydra can be easily
integrated with other enterprise systems, thereby providing
comprehensive, real time information utilised for senior decision
makers.
During the year under review there has been an increase in the
demand for the enhanced functionality which has been added to the
software from existing Hydra customers as well as new customers.
This has resulted in increased revenues of 41% for the year.
During the year Hydra released version 7.0. This release saw the
addition of new reporting features and a "what if" planning
scenario capability. These features contributed to the addition of
a number of new customers across a range of sectors including
financial services, betting, marketing, insurance, engineering, and
support services. Hydra continues to have a strong presence in the
public sector which uses its software to optimise resource
utilisation and planning.
Board appointment
As announced separately this morning, following Professor Stan
Newman's retirement at the last Annual General Meeting, we have
today appointed Professor Gerry Musgrave as our Senior Independent
Director and Non-Executive Chairman. With the appointment of Gerry
Musgrave I will be taking a role of non-executive director. Gerry
brings with him over 40 years of directorial experience and
significant experience with AIM listed companies. Gerry has served
on board positions with Cirrus Computers, Plessey Finance
Corporation and Siemens PLC. Most recently he was executive
chairman of Corac Group plc and Mechadyne International plc. He was
also Pro-Vice Chancellor of Brunel University.
Registered Office
The Company has moved its registered office to IP City Centre, 1
Bath Street, Ipswich IP2 8SD with immediate effect.
Borrowing facilities
In 2010 the Group's operations generated cash of GBP185,340
(2009: GBP219,502). Additionallythe Group reduced its cost base in
2010 and we are anticipating the full benefit of these reductions
will flow into 2011's financial results. Given this recent
performance and the Group's current forecasts and projections,
which take into account different scenarios with respect to trading
performance, the directors believe that the Group should be able to
operate within the level of its current banking facilities.
The Group has opened renewal negotiations with its banks to
extend the current facilities for a further twelve month period, on
their renewal dates. At this stage it has not sought separate
written commitment that the facilities will be renewed. However,
during the course of the negotiations so far, no matters have been
drawn to the Group's attention to suggest that renewal may not be
forthcoming on acceptable terms.
Outlook
We now have two businesses that when taken together are capable
of delivering improving results. In the Clinical business we look
forward to continuing to develop our relationship with industry
partners, enhancing our clinical applications to support new
geographic markets and extending our license base in our
traditional markets of the UK and US. The Hydra business has
delivered two consecutive years of revenue growth and we continue
to see growing demand for the Hydra products.
In the current economic climate, we will continue to manage both
businesses against the background of local, regional and national
government funding pressures and will manage our cost structure in
line with our revenue expectations.
H Kitchner
Chairman
21 April 2011
Finance Review
Results for the year
The Group derives its revenues from two business units: Hydra
Management and Clinical Computing. Review of each business has been
provided in the Chairman's Statement.
Total revenues for the year ending 31 December 2010 decreased by
7% to GBP2,969,839 (2009:GBP3,179,365). The revenues from the
Clinical business generated 64% (2009: 76%) of the Group's revenues
and 36% (2009: 24%) were derived from the Hydra business. Across
the Group maintenance revenues for the year were GBP1,692,305 or
57% of revenue (2009: GBP1,716,862 or 54%). The decrease in
maintenance revenues in absolute terms between the years was
approximately 1%.
The Group's total operating costs reduced 10% to GBP3,043,561
(2009: GBP3,399,050). The costs for the Clinical business were 70%
(2009: 76%) of the total operating costs with the Hydra business
accounting for 25% (2009: 18%) and the parent company accounting
for 5% (2009: 6%). The decrease in Group costs arose from
reductions in staff headcount in the Clinical business, and
specifically in resources focused on its legacy software
products.
The Group's EBITDA improved from a negative of GBP61,118 in 2009
to a positive of GBP70,152 in 2010 primarily as a result of the
reductions to costs in the Clinical business and increasing
revenues in the Hydra business.
Operations generated a loss of GBP73,722 (2009: loss
GBP219,685). The loss before tax was GBP89,188 (2009: loss
GBP232,632). The Group is reporting a profit for the year after tax
of GBP181,291 or 0.2p per share as a result of cash receipts from
the UK R&D tax credit as explain below (2009: profit of
GBP220,394 or 0.2p per share).
Software development
During the year under review the development teams undertook a
number of projects to enhance our current technologies. In the
Hydra business we release Hydra 7.0 and in the Clinical business we
released an iPhone application, a clinical document centre and
version 5.1 of clinicalvision. None of the costs associated with
these projects were capitalised during the year as the projects
were general enhancements which would not be separately licensed to
customers or identified as separate assets under the Group
accounting policies.
The Group has previously capitalised development costs
associated with its clinicalvision V web based chronic disease
product framework and the clinicalvision transplant module. The
amortisation expense for previously capitalised development costs
during the year was GBP93,872 (2009: GBP93,871), which is included
in the Group's research and development expense for the year of
GBP1,276,582 (2009: GBP1,341,838).
The Group is not anticipating any increases in its development
costs in 2011 as the majority of significant development activities
in the Group were undertaken in 2010 and prior years.
Taxation
The Company and all subsidiaries have sufficient tax losses such
that no tax expense has been recognised during the year. For the
year under review, the Group, through its two UK trading
subsidiaries, filed research and development ("R&D") tax credit
claims with respect to research activities undertaken in 2009 on
various components of the clinicalvision and Hydra products. An
election was made, under the terms of the current United Kingdom
R&D tax credit regime, for a percentage of the R&D
expenditure to be settled in cash. A tax credit in the amount of
GBP270,479 has been reported in 2010 based on 2009 research
activities. Total cash settlements from the R&D tax credit in
2009 were GBP453,026 which included 2008 activity as well as
amended claims for 2007 and 2006 activities.
Consistent with prior years, R&D tax credit/claims for
activities undertaken in 2010 will be accounted for when received
in 2011.
Cash flow and debt
During the year cash generated by operations was GBP185,340
(2009: GBP219,502) which resulted in the Group's cash balance
increasing 44% to GBP795,212 (2009: GBP551,404).
The Group actively uses one of its two working capital
facilities and is reporting an increase in borrowings for the year
of GBP55,401. Outstanding debt at the end of the year is GBP782,065
(2009: GBP726,664). Given the above cash balance and outstanding
debt the company now has a positive net cash position at the end of
the year of GBP13,147 (2009: negative GBP175,351).
At 31 December 2010 the Group had two debt facilities which in
total provided approximately GBP961,000 of working capital
facilities with GBP782,065 borrowed.
The Group has opened renewal negotiations with its banks to
extend the current facilities for a further twelve month period, on
their renewal dates. At this stage it has not sought separate
written commitment that the facilities will be renewed. However,
during the course of the negotiations so far, no matters have been
drawn to the Group's attention to suggest that renewal may not be
forthcoming on acceptable terms.
Capital structure and finance
The Group's consolidated equity position at 31 December 2010 was
a deficit of GBP135,349 (2009: deficit GBP282,959). The change to
the equity position was impacted primarily by the Group's results
for the year and the impact of foreign currency translation of
foreign owned subsidiaries.
The Company's current issued shares and voting capital consists
of 110,883,694 1p ordinary shares.
J Marlovits
Director
21 April 2011
Consolidated Income Statement
For the year ended 31 December 2010
Notes Unaudited Audited
2010 2009
GBP GBP
---------------------------------- ------ ------------ ------------
Continuing Operations
Total revenue 2 2,969,839 3,179,365
Cost of sales (637,839) (805,487)
__________ __________
Gross profit 2,332,000 2,373,878
Distribution costs (346,373) (330,578)
Administrative expenses
---------------------------------- ------ ------------ ------------
Research and development (1,276,582) (1,341,838)
Other (782,767) (921,147)
---------------------------------- ------ ------------ ------------
Total administrative expenses (2,059,349) (2,262,985)
__________ __________
Loss from operations (73,722) (219,685)
Finance income 316 1,506
Finance expense (15,782) (14,453)
__________ __________
Loss before tax (89,188) (232,632)
Income tax credit 270,479 453,026
__________ __________
Profit for the year attributable
to equity holders 181,291 220,394
__________ __________
Basic earnings per share 3 0.2p 0.2p
Diluted earnings per share 3 0.2p 0.2p
__________ __________
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2010
Unaudited Audited
2010 2009
GBP GBP
------------------------------------ ----------- -----------
Profit for the year 181,291 220,394
Other comprehensive income:
Exchange difference on translating
foreign operations (69,103) (22,522)
_________ _________
Other comprehensive loss for the
year (69,103) (22,522)
_________ _________
Total comprehensive income for
the year 112,188 197,872
__________ __________
Consolidated Statement of Financial Position
As at 31 December 2010
Unaudited Audited
2010 2009
GBP GBP
------------------------------- ------------- -------------
Non-current assets
Intangible assets 205,462 309,426
Goodwill 157,658 157,658
Property, plant and equipment 42,342 78,269
__________ __________
405,462 545,353
__________ __________
Current assets
Trade and other receivables 560,919 450,574
Cash and cash equivalents 795,212 551,404
__________ __________
1,356,131 1,001,978
__________ __________
Total assets 1,761,593 1,547,331
__________ __________
Current liabilities
Trade and other payables (376,326) (391,754)
Deferred income (738,551) (711,872)
Borrowings (782,065) (726,664)
__________ __________
(1,896,942) (1,830,290)
__________ __________
Net liabilities (135,349) (282,959)
_________ _________
Equity
Share capital (2,433,251) 2,433,251
Share premium account 7,750,957 7,750,957
Share option reserve 160,104 124,661
Translation reserve (63,481) 5,623
Retained earnings (10,416,180) (10,597,471)
__________ __________
Shareholders' funds - deficit (135,349) (282,959)
_________ _________
Consolidated Cash Flow Statement
For the year ended 31 December 2010
Notes Unaudited Audited
2010 2009
GBP GBP
---------------------------------------- ------ ----------- -----------
Net cash inflow from operating
activities 4 185,340 219,502
__________ __________
Investing activities
Interest received 316 1,506
Purchases of property, plant and
equipment (2,677) (12,203)
__________ __________
Net cash used in investing activities (2,361) (10,697)
__________ __________
Financing activities
Increase in bank loan 55,401 53,909
__________ __________
Net cash from financing activities 55,401 53,909
__________ __________
Net increase in cash and cash
equivalents 238,380 262,714
Cash and cash equivalents at beginning
of year 551,404 299,188
Effect of foreign exchange rate
changes 5,428 (10,498)
__________ __________
Cash and cash equivalents at end
of year 795,212 551,404
__________ __________
Consolidated Statement of Changes in Equity
For the year ended 31 December 2010
Share Share
Share premium option Translation Retained Shareholders'
capital account reserve reserve earnings funds
GBP GBP GBP GBP GBP GBP
At 1 January
2009 2,433,251 7,750,957 97,588 28,144 (10,817,865) (507,925)
Share option
charge - - 27,093 - - 27,093
Exchange
difference
on
translation
of foreign
operations - - - (22,521) - (22,521)
Profit for
the year - - - - 220,394 220,394
_________ __________ __________ __________ __________ __________
At 31
December
2009 2,433,251 7,750,957 124,681 5,623 (10,597,471) (282,959)
_______ __________ __________ __________ __________ __________
Share option
charge - - 35,423 - - 35,423
Exchange
difference
on
translation
of foreign
operations - - - (69,103) - (69,103)
'Profit for
the year - - - - 181,291 181,291
________ __________ __________ __________ __________ __________
At 31
December
2010 -
Unaudited 2,433,251 7,750,957 160,104 (63,481) (10,416,180) (135,349)
_______ __________ __________ __________ __________ __________
Notes
1. Basis of preparation
The unaudited preliminary announcement has been prepared
under the historical cost convention, on a going concern
basis and consistent with applicable International Financial
Reporting Standards and IFRIC interpretations ("IFRS")
as adopted by the EU.
The preliminary announcement has been prepared on the
basis of the same accounting policies as published in
the statutory accounts for the year ended 31 December
2009.
The financial information set out in this preliminary
announcement was approved by the board on 21 April 2011
and does not constitute statutory financial statements
as defined by the Companies Act 2006. The statutory accounts
for the year ended 31 December 2010 have not yet been
delivered to the Registrar of Companies and no audit
report has yet been given on the statutory financials
statements.
Statutory accounts for the year ended 31 December 2009have
been delivered to the Registrar of Companies. The audit
report on these statutory accounts was unqualified and
did not contain a statement either under section 237(2)
or 237 (3) of the Companies Act.
The Annual Report and Accounts for the year ended 31
December 2010 will be posted to shareholders in due course
and will be available at the Company's registered office
and on the Company's website simultaneously with posting.
2. Revenue
An analysis of the Group's revenue is as follows:
Unaudited Audited
2010 2009
GBP GBP
--------------------------- ---------- ----------
Software licenses 913,217 1,016,954
Maintenance 1,692,305 1,716,862
Services and other revenue 364,317 445,549
__________ __________
Revenue 2,969,839 3,179,365
__________ __________
3. Earnings per share
The calculation of the basic and diluted earnings per share is
based on the following data:
Unaudited Audited
2010 2009
GBP GBP
-------------------------------------------------- ------------ ------------
Earnings
Earnings for the purposes of basic and diluted
earnings per share 181,291 220,394
__________ __________
Number of shares
Number Number
Weighted average number of ordinary shares for
the purposes of basic and diluted earnings per
share 110,883,694 110,883,694
Dilutive share options for the purpose of diluted
earnings per share - 1,149,833
__________ __________
Earnings per share
Basic earnings per share 0.2p 0.2p
Diluted earnings per share 0.2p 0.2p
4. Notes to the cash flow statement
Unaudited Audited
2010 2009
GBP GBP
------------------------------------------------- ---------- ----------
Loss from operations (73,722) (219,685)
Adjustments for:
Depreciation of property, plant and equipment 39,910 54,527
Amortisation of intangible assets 103,964 104,040
Share option charges 35,423 27,093
__________ __________
Operating cash flows before movements in working
capital 105,575 (34,025)
Increase in receivables (83,916) (23,828)
Decrease in payables (60,914) (161,218)
__________ __________
Cash used by operations (39,255) (219,071)
Interest paid (15,782) (14,453)
Tax credit received 240,377 453,026
__________ __________
Net cash from operating activities 185,340 219,502
__________ __________
5. Business and geographical segments
For management and legal purposes, the Group consists of four
operating companies and the parent company. These companies are the
basis on which the Group reports its primary segment information.
The operating companies provide software, maintenance and related
services around their clinical and programme management software
products. There is no significant difference between risk and
return on the software and services offered between the operating
companies. The geographic segmental information presented below
excludes any intra-group revenue or expense.
Clinical Clinical Clinical Hydra Parent
US UK Australia UK UK Total
GBP GBP GBP GBP GBP GBP
-------------- ---------- ---------- --------- --------- ---------- ----------
2010 -
Unaudited
Revenue
Total Revenue 1,216,659 610,285 83,429 1,059,466 - 2,969,839
__________ __________ _______ _________ __________ __________
Segment result
Operating
profit/(loss) 393,937 (718,920) 108,981 304,249 (161,969) (73,722)
__________
Finance income 316
Finance
expense (15,782)
__________
Loss before
tax (89,188)
Income tax
credit 270,479
__________
Income for the
year
attributable
to equity
holders of
the company 181,291
__________
Balance Sheet
Segment assets 322,946 273,368 1,428 1,099,360 64,491 1,761,593
__________
Segment
liabilities 298,873 283,408 1,036 460,485 71,075 1,114,877
Current
borrowings - 782,065 - - - 782,065
__________
Total
liabilities 1,896,942
Other
Information __________
Capital
Expenditure - - - 2,677 - 2,677
Depreciation 20,030 18,810 - 1,070 - 39,910
Amortisation - 93,872 - 10,092 - 103,964
Clinical Clinical Clinical Hydra Parent
US UK Australia UK UK Total
GBP GBP GBP GBP GBP GBP
-------------- ---------- ----------- --------- --------- ---------- ----------
2009
Revenue
Total Revenue 1,747,973 602,916 77,465 751,011 - 3,179,365
__________ __________ _______ _________ __________ __________
Segment result
Operating
profit/(loss) 888,398 (1,114,943) 58,257 134,392 (185,789) (219,685)
__________
Finance income 1,506
Finance
expense (14,453)
__________
Loss before
tax (232,632)
Income tax
credit 453,026
__________
Income for the
year
attributable
to equity
holders of
the company 220,394
__________
Balance Sheet
Segment assets 328,878 384,854 8,166 761,899 63,534 1,547,331
__________
Segment
liabilities 280,957 298,385 6,664 446,545 71,075 1,103,626
Current
borrowings - 726,664 - - - 726,664
__________
Total
liabilities 1,830,290
__________
Other
Information
Capital
Expenditure 7,941 4,262 - - - 12,203
Depreciation 22,405 31,506 - 616 - 54,527
Amortisation - 93,871 - 10,169 - 104,040
This information is provided by RNS
The company news service from the London Stock Exchange
END
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