TIDMCLC
RNS Number : 0752N
Clinical Computing PLC
26 August 2011
CLINICAL COMPUTING PLC
HALF YEAR RESULTS FOR THE SIX MONTHS TO 30 JUNE 2011
Clinical Computing Plc ("the Group"), the international
developer of clinical information systems for the healthcare market
and developer of programme management software, announces its
Interim Results for the six months ended 30 June 2011. The Group
trades 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.
Financial Highlights
-- Total revenue of GBP1,342,813 (H1 2010: GBP1,517,767)
-- Recurring maintenance revenues of GBP842,792 (H1 2010:
GBP833,675)
-- Operating costs decreased to GBP1,402,544 (H1 2010:
GBP1,606,367)
-- Loss from operations of GBP59,731 (H1 2010: loss
GBP88,600)
-- R&D tax credit of GBP183,691 (H1 2010: GBP240,377)
-- Profit after tax of GBP115,691 (H1 2010: profit of
GBP144,185)
-- Earnings per share of 0.1p (H1 2010: earnings 0.1p)
-- EBITDA positive at GBP4,014 (H1 2010:GBP3,877)
-- Positive cash flow from operating activities GBP373,546 (H1
2010: GBP282,345)
Operational Highlights
-- Regional license agreement won in Australia, largest
clinicalvision v roll-out to date
-- Sussex Renal Innovation Programme successfully delivering
efficiencies to care teams
-- cv-analytics module beta testing a success
-- Partnering programmes being expanded across both the Clinical
and Hydra businesses
-- Hydra business continues to deliver positive operating
results
-- Hydra Manager V7 implemented by majority of customers with V8
scheduled for later this year
-- Hydra Manager new feature set to expand capabilities to other
industries
Outlook
Chairman Gerry Musgrave, commenting on the Group's outlook
said:
"The Group has two software solutions both of which, we believe,
have unique selling propositions compared to their respective
competitors. Our near term strategy will include continuing our
direct sales strategy for both products as well as expanding our
partnership programme with organisations that will help us increase
our revenue opportunities and leverage the software investments we
have made in the clinicalvision and Hydra Manager products.
We believe that the demand for our products will increase as we
expose our solutions to more partners and market these solutions
with recent reference sites that are using our latest releases. The
management team will continue to prudently manage its cash
resources throughout this process."
Contacts:
Joe Marlovits, Chief Executive
Clinical Computing Plc
www.ccl.com 01473 694770
Simon Sacerdoti / James Caithie
Cairn Financial Advisers LLP -
Nominated Adviser 020 7148 7900
CHAIRMAN'S STATEMENT
Introduction
We are pleased to report our interim results for the six month
period to 30 June 2011.
The Group has two main software solutions: clinicalvision which
is a web-based electronic medical record application for chronic
diseases and Hydra Manager which is an enterprise-wide programme
management application. Both of these solutions are expert systems
and are aimed at the sophisticated end user for their respective
markets. Likewise, each solution is a tool to drive effective and
efficient use of resources. In the clinicalvision world this is to
provide clinical teams with the most up to date and accurate
patient information, so that they can more effectively manage
increasing number of patients. In the Hydra world this is to
maximise project resources and manage on-time delivery of projects
across diverse skill sets.
Despite an overall drop in turnover, the Group continues its
recent positive financial trends with respect to operating results,
after tax profitability and positive operating cash flow.
In each business we expect to release an application update
before the end of the year. The clinicalvision product will be
upgraded to include a visual scheduling component as well as
further support for tablet type computers used in the healthcare
environment. Hydra Manager will be upgraded to include more generic
resource planning so that we can expand the market potential for
this product.
Clinical business
We are pleased to announce that we have been awarded a large
multi-year contract with a state-wide dialysis programme in
Australia. The Company has been pursuing several regional and
state-wide opportunities in Australia, Canada and the UK. This is
the first win of several active regional tenders the business is
pursuing. The contract secured in Australia will provide the
company with not only a significant reference site, but a fully
integrated roll-out of clinicalvision involving 17 interfaces
making this one of the most integrated clinical department
roll-outs undertaken to support renal medicine. We anticipate the
implementation of this project to start in September 2011.
We have also completed the majority of the work involved with
the Sussex Renal Innovation Programme in the UK and have received
extremely positive feedback with respect to the efficiency and time
savings our clinicalvision solution is delivering to this
programme, particularly the analysis module (cv-analytics) which
was beta tested at this site. We continue to gather strong evidence
to support the pay-back time on an investment in clinicalvision,
and the analytics module is one of the primary features delivering
a significant savings in Nephrologists' time.
Looking ahead to the second half of 2011, the Company is
focusing its resources on specific initiatives in the US, Canada,
Australia and the UK where healthcare providers are required to
demonstrate that they are improving the quality of patient care. In
most cases these initiatives do not require changes to our product,
but do require a professional service approach to package a
solution which meets the needs of each geographic market. We
anticipate that these initiatives will generate new revenues from
our current clients.
Hydra business
The business continues to win new orders from existing as well
as new customers. Following a very successful 2010, Hydra has
delivered very consistent result for the first half of 2011.
The depth and breadth of features and stability of the Hydra
Software combined with the rapid implementation processes we now
have, are proving to be key reasons for customers continuing to
select Hydra over other alternatives.
The Hydra Manager application assists organisations in improving
efficiencies and identifying project constraints. The valuable
management information regarding the performance of portfolios,
projects and resources that is available from Hydra at the planning
stage as well as throughout the life of the project continues to
ensure that the uptake of Hydra expands within most of our customer
accounts.
Businesses continue to seek efficiency improvements and Hydra
Manager is a key tool in managing the delivery of these
improvements.
The combination of market focus, product strengths and a short
payback period has contributed to the revenue and profit growth in
the first half. Hydra operating profit for the period was
GBP120,075 (2010 H1: GBP78,851).
Financial results
Total revenue of GBP1,342,813 decreased from the amount reported
for the same period in the prior year (H1 2010: GBP1,517,767)
primarily due to a decrease in new business from Clinical's NHS
customers.
The Group's revenue mix by business was:
63% Clinical with revenues of GBP842,578 (H1 2010: GBP1,074,897
and 71%)
37% Hydra with revenues of GBP500,235 (H1 2010: GBP442,870 and
29%).
Recurring maintenance revenues of GBP842,792 (H1 2010:
GBP833,675) accounted for 63% (H1 2010: 55%) of our total
revenues.
The Group's operating costs continue to decrease as we adjust
our operating structure away from research and development. Total
operating costs have decreased 13% to GBP1,402,544 (H1 2010:
GBP1,606,367).
Group operating costs are attributed to each business unit as
follows:
68% Clinical business or GBP953,776 (H1 2010: GBP1,156,435 and
72%)
27% Hydra business or GBP380,160 (H1 2010: GBP364,019 and
23%)
5% Parent company costs were GBP68,608 (H1 2010: GBP85,913 and
5%).
Loss from operations improved to GBP59,731 (H1 2010: loss
GBP88,600) and are shown below by business unit:
Clinical business operating loss GBP111,198 (H1 2010: loss
GBP81,538)
Hydra business operating profit GBP120,075 (H1 2010: profit
GBP78,851)
Parent Company operating loss GBP68,608 (H1 2010: loss
GBP85,913)
As in prior years the Group continues to develop its core
technologies: clinicalvision and Hydra Manager. This development
effort has resulted in the Group receiving R&D tax credits
under the United Kingdom R&D tax credit regime. In the period
under review the Group has received GBP183,691 of tax credits for
research and development activities undertaken in 2010 (H1 2010:
R&D tax credit of GBP240,377 for research and development
undertaken in 2009).
The Group is reporting a profit after tax of GBP115,691 for the
period (H1 2010: profit GBP144,185). Earnings per share for the
period under review was 0.1p (H1 2010: earnings per share of
0.1p).
EBITDA for the first half 2011 was a positive GBP4,014 compared
to GBP3,877 in the first half of 2010. The non-cash charge for the
first half of 2011 was GBP63,745 (H1 2010: GBP92,477). This is the
fourth consecutive six month period in which the Group has reported
positive EBITDA.
Likewise, we are also reporting positive cash flow from
operating activities. Operating cash flows were GBP373,546 for the
period under review (H1 2010: GBP282,345).
During the twelve month period ending 30 June 2011 the Group
increased its borrowings by GBP8,390 (twelve months ended 30 June
2010 increased GBP52,220). The Group's available debt facilities
amount to GBP956,000, of which GBP790,455 was drawn at 30 June
2011. Consequently at 30 June 2011 there were undrawn facilities of
GBP165,545, in addition to the cash balance of GBP1,172,600. Given
the above cash resources, the Group's operational performance and
order book, and its forecasts and projections, the directors have a
reasonable expectation that the Group has adequate resources to
continue in operational existence for the foreseeable future.
Outlook
The Group has two software solutions both of which, we believe,
have unique selling propositions compared to their respective
competitors. Our near term strategy will include continuing our
direct sales strategy for both products as well as expanding our
partnership programme with organisations that will help us increase
our revenue opportunities and leverage the software investments we
have made in the clinicalvision and Hydra Manager products.
We believe that the demand for our products will increase as we
expose our solutions to more partners and market these solutions
with recent reference sites that are using our latest releases. The
management team will continue to prudently manage its cash
resources throughout this process.
Gerry Musgrave
Chairman
26 August 2011
Unaudited condensed consolidated income statement
Six months ended 30 June 2011
Audited
Six months Six months year
ended ended ended
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Continuing operations
Total revenue (Note 3) 1,342,813 1,517,767 2,969,839
Cost of sales (352,392) (365,956) (637,839)
-------------- -------------- -----------------
Gross profit 990,421 1,151,811 2,332,000
Distribution costs (139,064) (155,132) (346,373)
Administrative expenses
--------------- --------------- ------------------
Research and
development (544,830) (654,947) (1,276,582)
Other (366,258) (430,332) (782,767)
--------------- --------------- ------------------
Total
administrative
expenses (911,088) (1,085,279) (2,059,349)
-------------- ------------- -----------------
Loss from operations (59,731) (88,600) (73,722)
Finance income 121 101 316
Finance expense (8,390) (7,693) (15,782)
-------------- ------------ -----------------
Loss before tax (68,000) (96,192) (89,188)
Income tax credit (Note
4) 183,691 240,377 270,479
-------------- ------------ -----------------
Profit for the period
attributable to company
equity holders 115,691 144,185 181,291
-------------- ------------ ----------------
Basic earnings per share 0.1p 0.1p 0.2p
(Note 5) -------------- ------------ ----------------
Diluted earnings per share 0.1p 0.1p 0.2p
(Note 5) -------------- -------------- ----------------
The notes form part of this condensed financial information.
Unaudited condensed consolidated statement of comprehensive
income
Six months ended 30 June 2011
Audited
Six months Six months Year
Ended Ended Ended
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Profit for the period 115,691 144,185 181,291
Exchange differences on
translating foreign
operations (2,385) (37,333) (69,104)
------------- ------------- ----------------
Total comprehensive income
for the period 113,306 106,852 112,187
------------- ------------- ----------------
The notes form part of this condensed financial information.
Unaudited condensed consolidated statement of financial
position
30 June 2011
Audited
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Non-current assets
Intangible assets 160,367 257,444 205,462
Goodwill 157,658 157,658 157,658
Property, plant and
equipment 30,577 60,485 42,342
--------------- --------------- ------------
348,602 475,587 405,462
--------------- --------------- ------------
Current assets
Trade and other
receivables 483,541 530,857 560,919
Cash and cash
equivalents 1,172,600 847,859 795,212
--------------- --------------- ------------
1,656,141 1,378,716 1,356,131
--------------- --------------- ------------
Total assets 2,004,743 1,854,303 1,761,593
--------------- --------------- ------------
Current liabilities
Trade and other
payables (368,637) (424,290) (376,326)
Deferred income (862,155) (853,721) (738,551)
Bank loans (790,455) (734,687) (782,065)
--------------- --------------- -------------
(2,021,47) (2,012,698) (1,896,942)
--------------- --------------- ---------------
Net liabilities (16,504) (158,395) (135,349)
--------------- --------------- -------------
Equity
Share capital 2,433,251 2,433,251 2,433,251
Share premium account 7,750,957 7,750,957 7,750,957
Share option reserve 165,643 142,393 160,104
Translation reserve (65,866) (31,710) (63,481)
Retained earnings (10,300,489) (10,453,286) (10,416,180)
--------------- --------------- -----------------
Shareholders' funds -
deficit (Note 6) (16,504) (158,395) (135,349)
-------------- -------------- ------------
The notes form part of this condensed financial information.
Unaudited condensed consolidated statement of cash flow
Six months ended 30 June 2011
Audited
Six months Six months year
ended ended ended
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Net cash from
operating activities
(Note 7) 373,546 282,345 185,340
Investing activities
Interest received 121 101 316
Purchases of property,
plant and equipment (2,231) (2,676) (2,677)
--------------- --------------- --------------
Net cash used in
investing activities (2,110) (2,575) (2,361)
--------------- --------------- --------------
Financing activities
Increase in bank loan 8,390 8,023 55,401
--------------- --------------- ---------------
Net cash from
financing activities 8,390 8,023 55,401
--------------- --------------- ---------------
Net increase in cash
and cash equivalents 379,826 287,793 238,380
Cash and cash
equivalents at
beginning of period 795,212 551,404 551,404
Effect of foreign
exchange rate
changes (2,438) 8,662 5,428
--------------- --------------- ----------------
Cash and cash
equivalents at end of
period 1,172,600 847,859 795,212
--------------- --------------- ---------------
The notes form part of this condensed financial information.
NOTES:
1. Basis of preparation
The accounting policies applied in the unaudited condensed
interim financial statements have been prepared in conformity with
recognition and measurement principles required by International
Financial Reporting Standards ("IFRS") in issue and as adopted by
the European Union and are effective or are expected to be adopted
and effective at 31 December 2011. The unaudited financial
statements have been prepared using accounting policies consistent
in all material respects with those applied in the Group's Annual
Report for the year ended 31 December 2010 and consistent with
those that will be applied during the year ended 31 December 2011.
The financial information provided herein should be read in
connection with the Group's audited Consolidated Financial
Statements and the notes thereto for the year ended 31 December
2010.
The Group is marginally loss making at the operational level.
The directors continue to monitor management's forecasts for
revenues, costs and working capital needs on a regular basis.
Although these projections show improving trading conditions,
inherently there can be no certainty that these forecasts will be
achieved. Following a review of the above noted forecasts and
taking into account available borrowing facilities, the directors
have formed a judgement, at the time of approving this interim
announcement, that there is reasonable expectation that the Group
has adequate resources to continue in operational existence for the
foreseeable future.
This interim report does not constitute statutory accounts of
the Group within the meaning of section 435 of the Companies Act
2006. Statutory accounts for the year ended 31 December 2010 have
been filed with the Registrar of Companies. The auditors' report on
those accounts was unqualified and did not contain a statement
under section 498 of the Companies Act 2006.
2. Business and geographic segments
Unaudited Unaudited Audited
six months six months year
Ended ended ended
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Revenue by segment
Clinical business UK 228,507 406,502 610,285
Clinical business USA 546,399 627,480 1,216,659
Clinical business
Australia 67,672 40,915 83,429
Hydra business 500,235 442,870 1,059,466
--------------- --------------- ----------------
1,342,813 1,517,767 2,969,839
--------------- ---------------- ----------------
3. Revenue
Unaudited Unaudited Audited
six months six months year
Ended Ended Ended
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Revenue by type
Software licences 301,027 506,747 913,217
Maintenance 842,792 833,675 1,692,305
Services and other revenue 198,994 177,345 364,317
------------- ------------- --------------
Revenue 1,342,813 1,517,767 2,969,839
------------- ------------- --------------
4. Tax
The tax credits of GBP183,691 for the first half 2011 were
derived from activities under taken in 2010. The tax credits of
GBP240,377 reported for the half year ended 30 June 2010 were
derived from activities undertaken in 2009. The Group accounts for
research and development tax credits when there is sufficient
certainty over receipt of the amounts involved, which is generally,
when the claim has been filed with the applicable tax
authority.
5. Earnings per share
The calculation of the basic and diluted earnings per share is
based on the following data:
Unaudited Unaudited Audited
six months six months year
ended ended ended
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Earnings for the
purposes of basic
and diluted earnings
per share 115,691 144,185 181,291
--------------- --------------- -----------------
Number Number Number
Weighted average
number of ordinary
shares used in basic
earnings per share
calculation 110,883,694 110,883,694 110,883,694
Dilutive share
options - - -
--------------- --------------- ----------------
Weighted average
number of shares
used in diluted
earnings per share
calculation 110,883,694 110,883,694 110,883,694
--------------- --------------- ----------------
6. Unaudited condensed consolidated statement of changes in
equity
Share
Share Share option Translation Retained Shareholders'
capital premium reserve reserve losses funds
GBP GBP GBP GBP GBP GBP
At 31
December
2009 2,433,251 7,750,957 124,681 5,623 (10,597,471) (282,959)
Share
options - - 35,423 - - 35,423
Translation
of foreign
operations - - - (69,104) - (69,104)
Profit for
the year - - - - 181,291 181,291
------------- ------------ ----------- ----------- -------------- ---------------
At 31
December
2010 2,433,251 7,750,957 160,104 (63,481) (10,416,180) (135,349)
------------- ------------ ---------- ----------- -------------- ---------------
Share
options - - 5,539 - - 5,539
Translation
of foreign
operations - - - (2,385) - (2,385)
Profit for
the period - - - - 115,691 115,691
------------- ------------ ----------- ----------- -------------- ---------------
At 30 June
2011 2,433,251 7,750,957 165,643 (65,866) (10,300,489) (16,504)
------------- ------------ ---------- ----------- -------------- ---------------
Share
Share Share option Translation Retained Shareholders'
capital premium reserve reserve losses funds
GBP GBP GBP GBP GBP GBP
At 31
December
2009 2,433,251 7,750,957 124,681 5,623 (10,597,471) (282,959)
Share
options - - 17,712 - - 17,712
Translation
of foreign
operations - - - (37,333) - (37,333)
Profit for
the period - - - - 144,185 144,185
------------- ------------ ----------- ----------- -------------- ---------------
At 30 June
2010 2,433,251 7,750,957 142,393 (31,710) (10,453,286) (158,395)
------------- ------------ ---------- ----------- -------------- ---------------
7. Reconciliation of operating loss to operating
cash flows
Unaudited Unaudited Audited
six months six months year
ended ended Ended
30 June 30 June 31 December
2011 2010 2010
GBP GBP GBP
Loss from operations (59,731) (88,600) (73,722)
Adjustments for:
Depreciation of
property, plant and
equipment 13,111 22,783 39,910
Share option charges 5,539 17,712 35,423
Amortisation of
intangible assets 45,095 51,982 103,964
-------------- ---------------- ----------------
Operating cash flows
before movements in
working capital 4,014 3,877 105,575
Decrease/(increase)
in receivables 86,690 (85,691) (83,916)
Increase/(decrease)
in payables 77,439 131,475 (60,914)
-------------- ---------------- -----------------
Cash
generated/(used) by
operations 168,143 49,661 (39,255)
Tax credits received 213,793 240,377 240,377
Interest paid (8,390) (7,693) (15,782)
--------------- ---------------- -----------------
Net cash inflow from 373,546 282,345 185,340
operating --------------- ---------------- -----------------
activities
This information is provided by RNS
The company news service from the London Stock Exchange
END
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