TIDMLRM
RNS Number : 5268U
Lombard Risk Management PLC
25 October 2017
25 October 2017
Lombard Risk Management plc
("Lombard Risk" or the "Company")
Interim Results
Lombard Risk Management plc (AIM: LRM), the leading dedicated
global provider of collateral management and regulatory reporting
solutions, announces its interim results for the six months ended
30 September 2017.
Financial highlights
-- First-half revenue of GBP12.7m (H1 2016: GBP15.2m), down
16.4% largely due to a temporary fall in services revenues and some
delays in contract signings
-- Order book of contracted revenue at GBP9.2m (H1 2016:
GBP9.2m)
-- Annually recurring revenue up 4.9% to GBP6.4m (H1 2016:
GBP6.1m)
-- Sales bookings for the period down 21.9% on the previous
year, with software licence bookings down 63.6%
-- Negative EBITDA of GBP3.5m (H1 2016: positive GBP1.5m) owing
to lower revenue and planned increase in investment
-- Loss before tax of GBP5.9m (H1 2016: loss of GBP0.1m)
-- Capitalised development costs in the period totalled GBP2.7m
(H1 2016: GBP2.8m)
-- Loss per share of 1.47p (H1 2016: loss per share of
0.05p)
-- Cash at period end of GBP0.4m (30 September 2016: GBP6.9m)
with no debt (30 September 2016: GBPnil) and undrawn facilities of
GBP4.5m (H1 2016: GBP0.5m)
Operational highlights
-- New client wins including first mandate for the foreign
branch reporting of a Taiwanese bank
-- First client win for Australian Prudential Regulatory
Authority reporting
-- Six new AgileREPORTER(R) clients signed in EMEA, including
three new logos
-- Extension of partnership network with DTCC and new
partnerships with SmartDX and Elixium
-- Continued build-out of Birmingham technology centre
-- Record pipeline going into the second half of the year
Alastair Brown, CEO of Lombard Risk, commented:
"We recognise that this has been a challenging first half for
Lombard Risk. A number of opportunities we had hoped to secure in
the period remain in the pipeline as market distractions such as
MiFID II caused companies to delay on committing to new projects.
This leaves us much to do in the second half, and converting our
strong visible pipeline will be crucial to us meeting market
forecasts.
"However, with the size and quality of our pipeline at an
all-time high, we remain confident this can be achieved. During the
period strong foundations have been put in place, with an improved
salesforce, a new development centre in Birmingham, and a renewed
effort to target new business as well as extant cross-selling
opportunities. We expect delivery of a strong second half will
enable the Company to meet its stated objectives of being cash
generative. We believe this positions Lombard Risk well for the
future and we look forward to updating the market on progress
during the second half of the financial year."
For further information, please contact:
Lombard Risk Management plc Tel: 020 7593 6700
Alastair Brown, CEO
Nigel Gurney, CFO
finnCap Tel: 020 7220 0500
Stuart Andrews
Carl Holmes
Scott Mathieson
WG Partners LLP (Joint Broker) Tel: 020 3705 9330
David Wilson
Claes Spång
Chris Lee
Newgate Communications Tel: 020 7653 6550
Bob Huxford Email: lombard@newgatecomms.com
Charlotte Coulson
James Ash
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014.
About Lombard Risk
Lombard Risk is the leading dedicated global provider of
collateral management and regulatory reporting solutions to the
financial services industry. Through intelligent automation and
optimisation, Lombard Risk's clients are able to improve their
approach to risk management, gaining the agility they need to have
a competitive advantage. As well as bringing immediate and urgent
solutions to clients' needs, Lombard Risk's global team of experts
look beyond today's reporting and collateral management to develop
technology solutions that help them adapt as industry challenges
evolve.
Counting 30 of the world's "Top 50"' financial institutions
among its clients, Lombard Risk has been a trusted partner for 28
years. Founded in 1989 and headquartered in London, it has offices
in Europe (Birmingham and Frankfurt), New York and Asia Pacific
(Hong Kong, Shanghai and Singapore), and representative offices in
Atlanta, Cape Town, Sydney and Tokyo. Find out more at
lombardrisk.com.
Chief Executive Officer's statement
A number of factors have combined to make the first half of the
current financial year slower than in the same period of the
previous year. However, we created a large number of good
opportunities, many of which we are confident can be realised in
the second half of this financial year. A number of geographies
faced unexpected headwinds, resulting in banks' resources being
tied up in other commitments and ultimately causing slippage in our
pipeline.
As indicated in our AGM statement in July, this slower first
half was anticipated and we expect the full year 2018 to be
significantly weighted towards the second half, in what is
traditionally a second half weighted business. Business development
activity to build a sustainable pipeline going forward has been
extremely intensive during the period, and I am pleased to report
that the current pipeline is at an all-time high. This underpins
the Board's confidence in the ultimate outcome of the year,
recovering to our stated ambition of becoming cash generative.
Continued investment in the salesforce
Building a professional salesforce was a major contributor to
our success in the prior financial year, improving discipline
around servicing clients through upsell and early renewals. The
first half of the current year has seen this focus extend to new
business development by investing in sales talent with dedicated
financial services experience, capable of increasing the rate at
which we generate new opportunities in addition to mining the
existing customer base.
This investment did not occur early enough to generate results
in terms of securing new business in the first half of this year
and as such was in part responsible for the shortfall in activity
which resulted in a decline in bookings for software licence sales
of 63.6% compared to the corresponding period last year. In
addition, our services revenues experienced a temporary decline, as
two major long-term projects were completed and there was a hiatus
while resources were redeployed. However, this continued investment
has now seen a major uptick in the twelve-month rolling pipeline
and it is this that gives the Board confidence in the second half
of the year. Our concerted efforts on this front saw a number of
new regulatory reporting opportunities added to the pipeline with
some closing in the first half. The equally intensive work on the
collateral side of the business has taken longer to flow through
given the nature of these opportunities and the longer lead times.
However, this process is now industrialised, and the pipeline for
the second half is not only higher quality than previous periods,
but also, as mentioned above, at an all-time high, with the global
pipeline up 44% since the beginning of the financial year.
Success in Asia and Australia
We commented on the challenges faced in Asia at the year end,
and set out a plan for reinvesting in a region where Lombard Risk
has numerous clients, and has enjoyed previous success. We are
pleased to report that this investment has started to deliver, with
new regulatory reporting wins displacing the competition and
winning new logos in both Hong Kong and Singapore. Further, we have
built on our extensive experience supporting Indian and Chinese
banks with their foreign branches in Hong Kong and Singapore, by
winning our first mandate for the foreign branch of a Taiwanese
bank.
Lombard Risk has been working closely with existing clients and
other industry participants in anticipation of the new Australian
Prudential Regulatory Authority ("APRA") regulations due to come
into force in 2018 and 2019. We were delighted to close our first
APRA client in the first half, and are looking forward to
supporting existing clients with their Australian branches as well
as demonstrating the powerful capabilities AgileREPORTER(R) offers
to new prospects seeking a multi-geography, multi-regulator
solution.
The new team is now fully established developing our business in
Hong Kong, Singapore, Japan and Australia, and with the new
Singapore MAS 610 regime, in addition to the APRA changes, we see
significant opportunities in the region going forward. We have yet
to enjoy the success with COLLINE(R) in Asia Pacific that we have
enjoyed in other regions, and again the new team brings significant
collateral experience which is now adding to the regional pipeline
for this product line. We anticipate Asia Pacific being an
increasingly important region for Lombard Risk going forward.
Market-leading products
On the regulatory reporting side of the business, and having
completed the investment necessary to start the Oracle Financial
Services Analytical Application ("OFSAA") partnership, Lombard
Risk's attention has been focussed on developing our flagship
product, AgileREPORTER(R), for our loyal 200-plus reporting client
base and new customers alike. Following our success in FY 2017
deploying AgileREPORTER(R) to support North American clients
needing to file FR 2052a returns, we initiated a European campaign,
immediately signing up three customers to the upgrade programme in
addition to winning three new logos, including the first to
purchase our cloud-based version of the reporting solution. With
the five Oracle OFSAA and Lombard Risk customers already taking the
flagship solution, in addition to our advances in Australia
utilising the AgileREPORTER(R) platform, the product development
momentum is significant, and bodes well for the second half.
On the collateral management side of our business, we have
continued to build out the sophisticated Exchange Traded
Derivatives ("ETD") solution that we added to the array of asset
classes that COLLINE(R) supports last year. Working in close
partnership with one of the industry's largest prime brokers has
allowed us to develop a new module which will meet the ETD
requirements of any market participant, with the added benefit of
COLLINE(R)'s cross-product margining capabilities, which remain a
key differentiator.
Externally, we have been actively building our network of
partnerships, adding SmartDX and Elixium and extending our
relationship with DTCC to ensure that COLLINE(R) remains at the
heart of the post-trade ecosystem. This continued investment in our
product gives clients and prospects alike full confidence that
Lombard Risk remains fully committed to keeping abreast of the
rapid evolution of the derivatives landscape.
Partnership revenue
We experienced delays to building further on our successful
partnership with Oracle in the first half. With AgileREPORTER(R),
as an OFSAA on top of the Oracle Financial Services Data Foundation
("FSDF"), now live and filing reports at a number of our five
existing clients, both parties have been working tirelessly to
build pipeline in North America, Europe and Asia Pacific, which we
believe will come through in H2. These enterprise-wide data
projects are much bigger than the individual regulator date-driven
opportunities for which Lombard Risk has traditionally provided
solutions. Consequently, sales lead times are both longer and less
predictable than is typical, with potential clients exercising
caution as they consider major transformational investment
decisions. That said, the volume of opportunities has risen
dramatically over the last year, and we remain optimistic about the
long-term value of this key partnership.
Partnerships remain a key component of our growth plan, and in
addition to the strategic relationships we have made to extend the
collateral ecosystem, we are working with several other potential
partners in each region to increase the reach of our solutions. We
look forward to providing further updates regarding these
developments in due course.
A world-class development centre
A key objective for the current year is to build out our new
development centre in Birmingham. This ambitious project remains on
track, with over forty engineers now in place, and hiring
proceeding as expected to reach full operational capability by June
2018. The first software deliveries have been completed, with two
COLLINE(R) releases shipped, and the AgileREPORTER(R) Analysis
Centre functionality developed in time for the launch at our highly
successful regulatory reporting conferences in New York and London
in September.
Amongst the many benefits the Birmingham Technology Centre
brings the firm is an advanced user experience capability, which is
developing the next generation of intuitive, time-saving interfaces
for both our product lines. This is allowing Lombard Risk to offer
the best in class of modern financial and regulatory technology,
married to our extensive historical investment in the product
itself, backed up with our track record of delivery. We expect this
to continue to be a differentiator in the modern financial services
software marketplace.
Financial review
Recognised revenue of GBP12.7m (H1 2016: GBP15.2m) was down
16.4% against the comparable period last year. Annually recurring
revenues for the half year totalled GBP6.4m (H1 2016: GBP6.1m)
representing 50.4% (H1 2016: 40.1%) of total revenues. Regulatory
Reporting revenues rose by 8.5% to GBP7.7m (H1 2016: GBP7.1m) while
Risk Management revenues fell by 38.3% to GBP5.0m (H1 2016:
GBP8.1m). The fall in revenues was not restricted to one region:
EMEA revenues fell by 25% to GBP5.7m (H1 2016: GBP7.6m); North
America revenues were flat at GBP5.2m (H1 2016: GBP5.2m); and Asia
Pacific revenues fell by 29.2% to GBP1.7m (H1 2016: GBP2.4m).
Net cash at 30 September 2017 was GBP0.4m (H1 2016: GBP6.9m) as
a result of both the disappointing revenue performance and the
continued investment in both the Company's products and
infrastructure as envisaged at the time of our fundraise in the
summer of 2016. This has resulted in a loss before tax of GBP5.9m
(H1 2016: GBP0.1m). Earnings before interest, taxation,
depreciation and amortisation ("EBITDA") were negative GBP3.5m (H1
2016: positive GBP1.5m). As reported in the annual report for the
year ended 31 March 2017, the Company has in place a revolving
credit facility of GBP4.0m with Barclays Bank Plc in addition to an
overdraft facility of GBP0.5m to cover short-term funding
needs.
Headcount as at 30 September 2017 was 337 (H1 2016: 378) as the
Company has rationalised its resources across a number of key
areas, in particular product and development.
The Company's accounting policies allow for the capitalisation
and amortisation of certain software development costs. Capitalised
development costs in the period totalled GBP2.7m (H1 2016: GBP2.8m)
representing 43.5% (H1 2016: 46.6%) of total technology and support
costs. The increase in total technology costs reflects both the
continued investment in the Company's next-generation products and
costs associated with the transition of certain development
activities to the new software development facility in
Birmingham.
The capitalisation of development costs affects the
interpretation of the financial performance of the Company.
Internally the Company's operating budget and monthly management
accounts measure financial performance assuming no such
capitalisation. Applying this assumption would result in negative
EBITDA for the six-month period of GBP6.1m (H1 2016: negative
EBITDA of GBP1.2m) and a loss before tax of GBP6.5m (H1 2016:
GBP1.4m).
Focussing on costs
As anticipated, the migration to Birmingham, conducted against a
background of intensive delivery commitments, has resulted in
transition costs which will largely fall in the current fiscal
year. Honouring our promises to clients and ensuring comprehensive
knowledge transfer are our top priorities, and are vital for the
future of the firm. As anticipated, the migration has already
allowed us to streamline some aspects of our product and technology
organisation, and we anticipate future cost savings both from
similar organisational simplification, as well as improvements in
quality arising from closer interaction with the customer services
and implementation teams.
Across the firm, we have taken opportunities to streamline costs
after the planned period of investment in the previous fiscal year.
This cost management process is progressing according to
expectations and the Board and the Executive Committee remain fully
focussed on transitioning the firm to cash profitability, and we
have taken additional cost reduction action to partially offset the
revenue delays experienced during the period under review.
Outlook
We recognise that this has been a challenging first half for
Lombard Risk. A number of opportunities we had hoped to secure in
the period remain in the pipeline as market distractions such as
MiFID II caused companies to delay on committing to new projects.
This leaves us much to do in the second half, and converting our
strong visible pipeline will be crucial in us meeting market
forecasts.
However, with the size and quality of our pipeline at an
all-time high, we remain confident this can be achieved. During the
period strong foundations have been put in place, with an improved
salesforce, a new development centre in Birmingham, and a renewed
effort to target new business as well as extant cross-selling
opportunities. We believe this positions Lombard Risk well for the
future and delivery of a strong second half will enable the Company
to meet its stated objectives of being cash generative. We look
forward to updating the market on progress during the second half
of the financial year.
Alastair Brown
Chief Executive Officer
25 October 2017
Consolidated unaudited interim statement of comprehensive
income
For the six months ended 30 September 2017
Unaudited Unaudited
Six months Six months Audited
ended ended Year ended
30 September 30 September 31 March
2017 2016 2017
Note GBP000 GBP000 GBP000
----------------------------- ----- -------------------- -------------- ------------
Continuing operations
Revenue 12,690 15,196 34,331
Cost of sales (94) (26) (122)
----------------------------- ----- -------------------- -------------- ------------
Gross profit 12,596 15,170 34,209
Administrative expenses (16,065) (13,663) (31,836)
----------------------------- ----- -------------------- -------------- ------------
EBITDA (3,469) 1,507 2,373
Depreciation, amortisation
and impairment (2,425) (1,686) (4,061)
Net finance income - 66 71
----------------------------- ----- -------------------- -------------- ------------
Loss before taxation (5,894) (113) (1,617)
Taxation charge 3 (1) (75) 917
----------------------------- ----- -------------------- -------------- ------------
Loss for the period
from continuing operations (5,895) (188) (700)
----------------------------- ----- -------------------- -------------- ------------
Loss for the period
from continuing operations
attributable to:
Owners of the Parent (5,895) (188) (700)
----------------------------- ----- -------------------- -------------- ------------
Other comprehensive
income
Exchange differences
on translating foreign
operations (39) 103 103
----------------------------- ----- -------------------- -------------- ------------
Total comprehensive
income for the period (5,934) (85) (597)
----------------------------- ----- -------------------- -------------- ------------
Loss per share
Basic (pence) 2 (1.47) (0.05) (0.18)
Diluted (pence) 2 (1.47) (0.05) (0.18)
----------------------------- ----- -------------------- -------------- ------------
Consolidated unaudited interim statement of financial
position
As at 30 September 2017
Unaudited Unaudited Audited
as at as at as at
30 September 30 September 31 March
2017 2016 2017
GBP000 GBP000 GBP000
----------------------------- -------------- -------------- ----------
Non-current assets
Property, plant and
equipment 781 610 942
Goodwill 5,974 6,013 6,013
Other intangible assets 21,123 17,920 20,517
Trade and other receivables 2,074 1,843 1,758
Deferred tax asset 493 221 493
----------------------------- -------------- -------------- ----------
30,445 26,607 29,723
----------------------------- -------------- -------------- ----------
Current assets
Trade and other receivables 6,484 7,770 9,438
Cash and cash equivalents 406 6,868 7,008
----------------------------- -------------- -------------- ----------
6,890 14,638 16,446
----------------------------- -------------- -------------- ----------
Total assets 37,335 41,245 46,169
----------------------------- -------------- -------------- ----------
Current liabilities
Trade and other payables (5,539) (3,784) (6,373)
Deferred income (8,343) (7,812) (10,460)
----------------------------- -------------- -------------- ----------
(13,882) (11,596) (16,833)
Non-current liabilities
Trade and other payables (86) - (122)
----------------------------- -------------- -------------- ----------
Total liabilities (13,968) (11,596) (16,955)
----------------------------- -------------- -------------- ----------
Net assets 23,367 29,649 29,214
----------------------------- -------------- -------------- ----------
Equity
Share capital 2,433 2,433 2,433
Share premium account 20,620 20,620 20,620
Foreign exchange reserves 41 80 80
Other reserves 2,038 1,908 1,981
Retained profit (1,765) 4,608 4,100
----------------------------- -------------- -------------- ----------
Equity attributable
to owners of the Parent 23,367 29,649 29,214
----------------------------- -------------- -------------- ----------
Consolidated unaudited interim statement of changes in
equity
For the six months ended 30 September 2017
Total
attributable
to
the
Profit owners
Share Foreign and of
Share premium exchange Other loss the
capital account reserves reserves account Company
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Balance at 1 April 2016 1,958 13,221 (23) 1,800 4,785 21,741
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Issue of share capital 475 7,399 - - - 7,874
Share-based payment charge - - - 119 - 119
Share options lapsed or
exercised - - - (11) 11 -
Transaction with owners
directly in equity 475 7,399 - 108 11 7,993
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Loss for the period - - - - (188) (188)
Other comprehensive income
Exchange differences on
translating foreign operations - - 103 - - 103
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Total comprehensive income
for the period - - 103 - (188) (85)
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Balance at 30 September
2016 2,433 20,620 80 1,908 4,608 29,649
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Total
attributable
to
the
Profit owners
Share Foreign and of
Share premium exchange Other loss the
capital account reserves reserves account Company
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Balance at 1 October 2016 2,433 20,620 80 1,908 4,608 29,649
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Share-based payment charge - - - 77 - 77
Share options lapsed or
exercised - - - (4) 4 -
Transaction with owners
directly in equity - - - 73 4 77
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Loss profit for the year - - - - (512) (512)
Other comprehensive income
Exchange differences on
translating foreign operations - - - - - -
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Total comprehensive income
for the year - - - - (512) (512)
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Balance at 31 March 2017 2,433 20,620 80 1,981 4,100 29,214
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Total
attributable
to
the
Profit owners
Share Foreign and of
Share premium exchange Other loss the
capital account reserves reserves account Company
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Balance at 1 April 2017 2,433 20,620 80 1,981 4,100 29,214
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Share-based payment charge - - - 87 - 87
Share options lapsed or
exercised - - - (30) 30 -
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Transaction with owners
directly in equity - - - 57 30 87
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Loss for the period - - - - (5,895) (5,895)
Other comprehensive income
Exchange differences on
translating foreign operations - - (39) - - (39)
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Total comprehensive income
for the period - - (39) - (5,895) (5,934)
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Balance at 30 September
2017 2,433 20,620 41 2,038 (1,765) 23,367
--------------------------------- --------- --------- ---------- ---------- --------- --------------
Consolidated unaudited interim statement of cash flow
For the six months ended 30 September 2017
Unaudited Unaudited
Six months Six months Audited
ended ended Year ended
30 September 30 September 31 March
2017 2016 2017
GBP000 GBP000 GBP000
----------------------------------- -------------- -------------- ------------
Cash flows from operating
activities
Loss for the period (5,895) (188) (700)
Tax charge 1 75 (917)
Net finance income - (66) (71)
----------------------------------- -------------- -------------- ------------
Operating loss (5,894) (179) (1,688)
Adjustments for:
Depreciation 277 211 414
Amortisation and impairment 2,148 1,475 3,647
Share-based payment charge 87 119 196
Decrease / (increase) in trade
and other receivables 1,940 (2,647) (3,528)
(Decrease) / increase in trade
and other payables (844) (579) 1,949
(Decrease) / increase in deferred
income (2,117) 486 3,134
Foreign exchange difference (2) 103 (18)
----------------------------------- -------------- -------------- ------------
Cash (used in) / generated
by operations (4,405) (1,011) 4,106
Tax credit received / (paid) 700 (34) (14)
----------------------------------- -------------- -------------- ------------
Net cash (used in) / generated
by operating activities (3,705) (1,045) 4,092
----------------------------------- -------------- -------------- ------------
Cash flows from investing
activities
Interest received - 66 71
Purchase of property, plant
and equipment and computer
software (183) (572) (849)
Capitalisation of development
expenditure (2,688) (2,797) (7,505)
----------------------------------- -------------- -------------- ------------
Net cash used in investing
activities (2,871) (3,303) (8,283)
----------------------------------- -------------- -------------- ------------
Cash flows from financing
activities
Shares issued, net of issue
costs - 7,874 7,874
Finance lease payments (26) - (17)
----------------------------------- -------------- -------------- ------------
Net cash (used in) / generated
by financing activities (26) 7,874 7,857
----------------------------------- -------------- -------------- ------------
Net (decrease) / increase
in cash and cash equivalents (6,602) 3,526 3,666
Cash and cash equivalents
at beginning of period 7,008 3,342 3,342
----------------------------------- -------------- -------------- ------------
Cash and cash equivalents
at end of period 406 6,868 7,008
----------------------------------- -------------- -------------- ------------
Notes to the interim report
For the six months ended 30 September 2017
1. Basis of preparation
This interim report was approved by the Board on 24 October
2017.
These unaudited consolidated financial statements are for the
six months ended 30 September 2017. They have been prepared in
accordance with International Financial Reporting Standards
("IFRS") and IFRS Interpretations Committee interpretations as at
30 September 2017, as adopted by the European Union. They do not
include any of the information required for full annual financial
statements and should be read in conjunction with the consolidated
financial statements of the Group for the year ended 31 March
2017.
The preparation of financial statements under IFRS requires the
Board to make judgements, estimates and assumptions that affect the
application of accounting policies, the reported amounts of
statement of financial position items at the period end and the
reported amount of revenue and expense during the reporting period.
The estimates and associated assumptions are based on historical
experience and various other factors that are believed to be
reasonable under the circumstances, the results of which form the
basis of making judgements that are not readily apparent from other
sources. However, the actual results may differ from these
estimates. The estimates and underlying assumptions are reviewed on
an ongoing basis.
This condensed consolidated financial information does not
comprise statutory accounts within the meaning of Section 434 of
the Companies Act 2006. Statutory accounts for the year ended 31
March 2017 were approved on 23 May 2017. These accounts, which
contain an unqualified audit report under Section 495 of the
Companies Act 2006 and which did not make any statements under
Section 498 of the Companies Act 2006, have been delivered to the
Registrar of Companies in accordance with Section 441 of the
Companies Act 2006.
2. Loss per share
Basic loss per share has been calculated by dividing the loss on
ordinary activities after taxation attributable to the owners of
the Parent by the weighted average number of ordinary shares of
0.5p each ("Ordinary Shares") in issue during each period.
Potential Ordinary Shares are treated as dilutive when, and only
when, their conversion to Ordinary Shares would decrease earnings
per share or increase loss per share from continuing operations. As
potential Ordinary Shares for 30 September 2017 would decrease the
loss per share, they are therefore not included in diluted earnings
per share.
Unaudited Unaudited
Six months Six months Audited
ended ended Year ended
30 September 30 September 31 March
2017 2016 2017
---------------------------- -------------- -------------- ------------
Loss for the period and
basic and diluted [loss]
attributable to Ordinary
Shareholders (GBP000) (5,895) (188) (700)
---------------------------- -------------- -------------- ------------
Weighted average number
of Ordinary Shares 400,593,920 354,589,248 380,046,607
Loss per share (pence) (1.47) (0.05) (0.18)
---------------------------- -------------- -------------- ------------
Effect of dilutive share
options:
Adjusted weighted average
number of Ordinary Shares 400,593,920 354,589,248 380,046,607
Diluted loss per share
(pence) (1.47) (0.05) (0.18)
---------------------------- -------------- -------------- ------------
3. Taxation
The taxation charge is based on the effective tax rate expected
to apply for the full year, taking into account the anticipated
benefit of brought forward tax losses. The effective tax rate is
higher than the standard tax rate, principally as a result of there
being no movement in the deferred tax asset recognised within the
Group. In addition, the charge for this interim period includes
GBP1,500 of current tax paid by overseas subsidiaries. The cash
flow statement includes receipt of the GBP698,000 of R&D tax
credit claimed in the 31 March 2016 tax returns as an adjustment in
respect of prior periods.
Company information
Company registration number
03224870
Directors
Alastair Brown
Chief Executive Officer
Nigel Gurney
Chief Financial Officer
Philip Crawford
Non-executive Chairman
John McCormick
Senior Non-executive Director
Steve Rogers
Non-executive Director
Sandy Broderick
Non-executive Director
Company Secretary
Nigel Gurney
Registered office
7th Floor
60 Gracechurch Street
London EC3V 0HR
Nominated adviser and joint broker
finnCap Limited
60 New Broad Street
London EC2M 1JJ
Joint broker
WG Partners LLP
85 Gresham Street
London EC2V 7NQ
Auditor
Grant Thornton UK LLP
Grant Thornton House
Melton Street
Euston Square
London NW1 2EP
Corporate solicitors
Memery Crystal LLP
44 Southampton Buildings
London WC2A 1AP
Registrars
Computershare Investor Services PLC
PO Box 859
The Pavilions
Bridgwater Road
Bristol BS99 1XZ
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IR GXBDGCUDBGRU
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October 25, 2017 02:00 ET (06:00 GMT)
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