TIDMQXT
RNS Number : 3440R
Quixant PLC
21 September 2017
21 September 2017
Quixant plc
("Quixant" or the "Company")
Interim Results
Quixant (AIM: QXT), a leading provider of specialised computing
platforms and monitors for gaming and slot machine applications, is
pleased to announce its Interim Results for the six months ended 30
June 2017.
Financial highlights:
-- Group revenue up 38% to $56.9m (1H 2016: $41.3m)
o Quixant Gaming division revenue $37.8m (1H 2016: $21.2m)
comprising:
- Gaming platforms revenue of $30.2m (1H 2016: $17.4m)
- Gaming monitors revenue of $7.6m (1H 2016 $3.8m)
o Densitron division revenue of $19.1m (1H 2016: $20.1m)
-- Group gross margin of 34% (1H 2016: 35%)
o Quixant Gaming division gross margin of 38% (1H 2016: 42%)
o Densitron division gross margin of 28% (1H 2016: 28%)
-- Group EBITDA up 74% to $10.1m (1H 2016: $5.8m)
-- Group adjusted EBITDA(1) up 70% to $10.2m (1H 2016: $6.0m)
o Quixant Gaming division up 89% to $8.9m (1H 2016: $4.7m)
o Densitron division $1.3m (1H 2016: $1.3m)
-- Group pre-tax profit up 98% to $8.7m (1H 2016: $4.4m)
-- Group adjusted pre-tax profit(2) up 77% to $9.2m (1H 2016: $5.2m)
o Quixant Gaming division up 98% to $8.1m (1H 2016: $4.1m)
o Densitron division $1.1m (1H 2016: $1.1m)
-- Fully diluted EPS of $0.1105/share (1H 2016: $0.052/share)
-- Net cash from operating activities of $4.3m (1H 2016: $6.1m)
-- Net cash at 30 June 2017 of $1.7m (31 December 2016: Net debt $0.1m)
1. Adjusted by adding back share based payments totalling $0.069m (1H 2016: $0.150m).
2. Adjusted by adding back amortization of intangibles arising
from acquisitions and share based payments totalling $0.513m (1H
2016: $0.764m).
Operational highlights:
-- Elevated demand for core gaming platform business, including
commenced volume shipments to new Tier 1 customer and awarded
another project with the same customer in early 2H 2017
-- Continued investment in business infrastructure, including
appointment of Duncan Johns as Managing Director of Densitron
division
-- Three new patents granted for gaming technology innovations
-- Commenced industry specific targeting initiative in Densitron
and developed first bespoke products for broadcast market
Jon Jayal, COO of Quixant, commented: "I am delighted to report
on a strong performance in the first six months of the year. We
announced on 24 July 2017 that trading had been stronger than
expected with all parts of our business performing well. Our core
gaming platforms revenue was particularly strong with higher than
expected orders from some of our key customers. This very strong
demand was, we believe, out of the ordinary and hence we do not
currently expect it to continue at this level for the full year.
Unlike previous years we therefore expect that the full year
results will not be second half weighted, although we are clearly
well placed to achieve market expectations for the full year. We
therefore look forward to the remainder of the year and beyond with
confidence."
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
For further information please contact:
Quixant plc Tel: +44 (0)1223
892 696
Jon Jayal, Chief Operating
Officer
Nominated Adviser and Broker:
finnCap Ltd Tel: +44(0)20
7220 0500
Matt Goode / Henrik Persson
/ Simon Hicks (Corporate
Finance)
Simon Johnson / Alice Lane
(Corporate Broking)
Financial PR: Tel: +44(0)20
8004 4217
Alma PR
John Coles / Hilary Buchanan
/ Susie Hudson
About Quixant
Quixant, founded in 2005, designs and manufactures highly
optimised computing solutions and monitors principally for the
global gaming industry. The Company is headquartered in Cambridge
in the UK where the global sales function is based. North America
sales and sales support is run from their subsidiary in Las Vegas.
Quixant has its own manufacturing and engineering operation based
in Taiwan and software engineering and customer support team based
in Italy. All the specialised products software and manufacturing
are produced in-house and Quixant owns all its own IP some of which
is protected by patents and design rights.
In November 2015 Quixant acquired Densitron Technologies plc.
Densitron has a strong heritage in the sale of electronic display
solutions to global industrial markets. Through Densitron's
experienced sales team, Quixant has a robust platform to build its
business into wider industrial markets. In-depth information on the
Company's products, markets, activities and history can be found on
the corporate website at www.quixant.com.
CHAIRMAN'S STATEMENT
I am, of course, very pleased with the performance of the Group
in the first six months of the year. The Quixant Gaming division
has performed particularly well with our core gaming platform
business growing revenues strongly. Our decision in 2015 to make a
strategic investment in building a business supplying optimised
monitors for the gaming industry as a means of increasing our
revenue share per machine is proving to be a success. Revenues of
$7.6m in the first half of 2017 for a business launched less than
three years ago, is an outstanding performance.
Densitron, which we acquired in the Autumn of 2015 continues to
perform well with good, profitable revenues in line with our
expectations. We have been working at strengthening several areas
of the organisation, including the appointment of Duncan Johns as
the new Managing Director to drive the business forward and
progress the initiatives Quixant has put in place. We continue to
identify new opportunities, especially with more focused products
for specific vertical markets. I am pleased with the progress
achieved and confident that the business is well positioned for
future growth.
We announced in March this year that our CEO, Nick Jarmany, had
passed his executive duties to COO Jon Jayal whilst he undergoes
medical treatment. Nick remains on the Board, where he is
continuing to play an active role. I am very pleased with the
structure we have in place and that the quality of our senior
management team has ensured the seamless performance of the Group
during Nick's absence.
As we maintain our track record of strong growth it is important
we continue to invest in our people and systems. As well as the
appointment of a Managing Director for Densitron we continue to
strengthen our technology and manufacturing divisions. I am also
very pleased that in March 2017 we appointed Gaye Hudson to the
Board as a non-executive director. Her extensive background in
corporate communications for esteemed corporations such as Oracle
inject high-calibre expertise to the Board in this area and will
help us to evolve our communications and marketing strategy as the
Group expands.
This has been a very good first half of the year for the Group
and I am confident that we are well positioned to continue to
perform well for the rest of the year and beyond.
CHIEF OPERATING OFFICER'S STATEMENT
Quixant's performance has been very strong in the first six
months of the year with all parts of the business performing well.
Total revenue grew 38% to $56.9m, up from $41.3m in the first half
of 2016. Adjusted pre-tax profit jumped 77% to $9.2m (H1 2016:
$5.2m) driven largely by the core gaming division.
Gaming Division
Our strong first half growth was principally driven by robust
performance from our core gaming platform business, ahead of
expectations. This is primarily due to elevated demand from some of
our key customers who placed higher than forecasted orders in the
period. In the past, our gaming platform business has been second
half weighted. Due to the unexpectedly high volume of shipments
made in the first half we do not currently expect this to be the
case this year. We are pleased to be entering the second half of
the year well-positioned to deliver strong year on year growth.
We commenced our business in gaming monitors in 2014 as a means
of providing customers with a gaming-optimised product that
complements our gaming platforms. There is at least one, but often
multiple monitors installed in every gaming machine in which our
platforms are installed so it is an area of considerable
opportunity to increase our revenue within our existing customer
base. We have years of credibility as a supplier that understands
the strict regulatory and technical requirements of the gaming
industry and this has enabled us to cross-sell monitors to many of
our platform customers. Revenue doubled in the period to $7.6m and
we continue to see significant further growth opportunities.
Furthermore, we are working on enhancing our gaming monitor product
offering to introduce more innovation and tie the solutions more
closely into our Gaming Ecosystem(R).
Our expansion into the largest gaming machine manufacturers
continued in the first half with volume shipments commencing as
expected to a new Tier 1 customer in the first half of the year. It
is pleasing that Quixant's strong delivery on this project has
resulted in us subsequently being awarded another project with this
customer. We have also attracted several gaming monitor
opportunities from the largest manufacturers in the industry who
are recognising Quixant as a credible supplier of gaming monitor
products.
Quixant's Gaming Ecosystem(R) has continued to evolve and we are
increasing our emphasis of marketing this essential,
differentiating component of our proposition. We secured several
new patents in the first half of the year and have filed
applications for a number of new innovations which will feature in
future products.
There continues to be longer term opportunities in new markets.
In May, Japan passed a bill which paves the way for further
legislation to enable the legalisation of casinos. The timescale
and nature of this opportunity remain unclear at present but
overall such moves towards regulated gaming are positive for the
industry. Brazil remains a possible long term opportunity for
market expansion but the situation remains politically
sensitive.
Densitron Division
The Densitron business is performing well, in line with our
expectations and we continue to invest in the business to identify
and target new growth opportunities. Revenues of $19.1m, slightly
lower than the same period last year, was in line with our
expectations following the cessation of non-performing products and
the rationalisation of the product portfolio.
In April, we appointed Duncan Johns as Managing Director of
Densitron. Duncan has considerable experience in instigating
organisational change working in senior management roles in a
variety of businesses in the UK, Europe and the Far East. This is a
key appointment as we position Densitron for future growth. Post
period end, we have also appointed a Technology Director to the
Densitron Division who is responsible for driving the enrichment of
our product offering with higher value solutions.
Earlier this year we exhibited at the broadcast show, BVE 2017
in London and following this we have commenced the development of
new products specifically designed for this market. We will be
exhibiting at IBC in Amsterdam in September 2017 where samples of
these new products will be showcased. Whilst we do not expect
revenue contribution from these new products in 2017, we are
excited by the opportunities to bring our technology, design and
manufacturing skills to products targeted at the broadcast
market.
Financial review
Revenue for the six months ended 30 June 2017 was $56.9m (1H
2016: $41.3m) comprising Gaming Division revenue of $37.8m (1H
2016: $21.2m) and Densitron division revenue of $19.1m (1H 2016:
$20.1m). The Group gross margin of 34% fell slightly from 35%
during the first half of 2016, mainly due to a decline in the
Gaming Division margin from 42% to 38%. This is partly explained by
a faster rate of growth in gaming monitors than gaming platforms
(the latter of which operate on a structurally higher margin) but
also due to a provision we made in the first half of the year. One
of the components incorporated into several of our products
required substitution for an alternative. These substitutions were
largely undertaken during the start of second half of this year but
we have made a full provision in the first half of 2017 in
anticipation of the expected costs.
Adjusted EBITDA was $10.2m up 70% (1H 2016: $6m). Adjusted
profit before tax for the six months of $9.2m was 77% ahead of the
same period last year (1H 2016: $5.2m). Both measures are adjusted
for share based payments and adjusted PBT for amortisation of
intangibles arising from acquisitions. EBITDA was $10.1m up 74% (1H
2016: $5.8m). Profit before tax for the 6 months of $8.7m was 98%
ahead of the same period last year (1H 2016: $4.4m). Fully diluted
earnings per share (EPS) for the period was $0.1105 per share (1H
2016: $0.052 per share).
The Group continues to maintain a strong balance sheet and this
has strengthened further in the six months of the year. Net assets
at 30 June 2017 of $41.2m compared with $34.3m at 31 December 2016
and $28.8m at 30 June 2016. The Group has increased its level of
investment in new products spending $0.8m in internally generated
research and development during the period compared with $0.5m in
the same period of 2016 and $1.0m for the full year in 2016.
Net cash at 30 June 2017 was $1.7m compared with net debt of
$0.1m at 31 December 2016. Net cash from operating activities was
$4.3m (1H 2016: $6.1m). In the same period, inventory has increased
by $8.5m following a decision to invest to meet near term demand
and ensure that sufficient levels of long lead time parts are
maintained. Other working capital balances have increased in line
with the increased level of business undertaken in the first half
of 2017.
The Group continued with its progressive dividend policy making
a payment of 2.0p per share, totalling $1.7m in May 2017. This was
in respect of the full year 2016 and represented the fourth
dividend payment made by the Group.
Outlook
We have had a great start to the year, underpinned by a strong
performance across all parts of the business. As we continue to
grow the business, we remain committed to the ongoing investment in
our people, infrastructure and products. Our core gaming market
remains strong over the long term and we are confident that the
Company is well positioned to continue our track record of growth.
Demand for our platforms in the first six months was exceptionally
strong and higher than our expectations. Whilst the nature of our
core global gaming market is always changing and uncertain, the
demand for our gaming platforms and monitors remains strong and we
are confident in achieving market expectations for the full year.
We are also encouraged by the opportunities identified in new
markets as part of the Densitron rationalisation programme.
CONDENSED CONSOLIDATED STATEMENT OF PROFIT AND LOSS
FOR THE SIX MONTHSED 30 JUNE 2017 AND 2016 AND YEARED 31
DECEMBER 2016
30 June 2017 30 June 2016 31 December 2016
Note
---------------------------------- ------- ------------- ------------- -----------------
$000 $000 $000
---------------------------------- ------- ------------- ------------- -----------------
Revenue 2 56,903 41,330 90,365
------------------------------------ ------- ------------- ------------- -----------------
Cost of sales (37,405) (26,971) (58,267)
------------------------------------ ------- ------------- ------------- -----------------
Gross profit 19,498 14,359 32,098
------------------------------------ ------- ------------- ------------- -----------------
Operating expenses (10,609) (9,747) (20,064)
------------------------------------ ------- ------------- ------------- -----------------
Operating profit 8,889 4,612 12,034
------------------------------------ ------- ------------- ------------- -----------------
Financial expenses (156) (217) (371)
------------------------------------ ------- ------------- ------------- -----------------
Profit before tax 2 8,733 4,395 11,663
------------------------------------ ------- ------------- ------------- -----------------
Taxation 3 (1,359) (929) (2,370)
------------------------------------ ------- ------------- ------------- -----------------
Profit for the period 7,374 3,466 9,293
------------------------------------ ------- ------------- ------------- -----------------
Attributable to
--------------------------------------------- ------------- ------------- -----------------
Equity shareholders 7,368 3,463 9,294
------------------------------------ ------- ------------- ------------- -----------------
Non-controlling interests 6 3 (1)
------------------------------------ ------- ------------- ------------- -----------------
Profit for the period 7,374 3,466 9,293
------------------------------------ ------- ------------- ------------- -----------------
Basic earnings per share 5 $0.1124 $0.0535 $0.1430
------------------------------------ ------- ------------- ------------- -----------------
Fully diluted earnings per share 5 $0.1105 $0.0520 $0.1395
------------------------------------ ------- ------------- ------------- -----------------
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHSED 30 JUNE 2017 AND 2016 AND YEARED 31
DECEMBER 2016
30 June 2017 30 June 2016 31 December 2016
------------------------------------------------------------ ------------- ------------- -----------------
$000 $000 $000
------------------------------------------------------------ ------------- ------------- -----------------
Profit for the period 7,374 3,466 9,293
--------------------------------------------------------------- ------------- ------------- -----------------
Other comprehensive income/(expense)
-------------------------------------------------------------- ------------- ------------- -----------------
Items that are or may be reclassified subsequently to profit
and loss
-------------------------------------------------------------- ------------- ------------- -----------------
Foreign currency translation differences 775 473 (47)
-------------------------------------------------------------- ------------- ------------- -----------------
Total comprehensive income for the period 8,149 3,939 9,246
-------------------------------------------------------------- ------------- ------------- -----------------
Total comprehensive income attributable to:
-------------------------------------------------------------- ------------- ------------- -----------------
Equity shareholders 8,143 3,936 9,247
--------------------------------------------------------------- ------------- ------------- -----------------
Non-controlling interests 6 3 (1)
--------------------------------------------------------------- ------------- ------------- -----------------
Total comprehensive income for the period 8,149 3,939 9,246
-------------------------------------------------------------- ------------- ------------- -----------------
BALANCE SHEET
AS AT 30 JUNE 2017 AND 2016 AND AT 31 DECEMBER 2016
30 June 2017 30 June 2016 31 December 2016
Note
----------------------------------------------------- ------- ------------- ------------- -----------------
$000 $000 $000
----------------------------------------------------- ------- ------------- ------------- -----------------
Non-current assets
----------------------------------------------------- ------- ------------- ------------- -----------------
Property, plant and equipment 6,143 5,939 5,977
------------------------------------------------------- ------- ------------- ------------- -----------------
Intangible assets 14,102 14,791 14,045
------------------------------------------------------- ------- ------------- ------------- -----------------
Investment property 648 676 617
------------------------------------------------------- ------- ------------- ------------- -----------------
Deferred tax assets 291 593 257
------------------------------------------------------- ------- ------------- ------------- -----------------
Total non-current assets 21,184 21,999 20,896
------------------------------------------------------- ------- ------------- ------------- -----------------
Current assets
----------------------------------------------------- ------- ------------- ------------- -----------------
Inventories 19,041 10,535 12,900
------------------------------------------------------- ------- ------------- ------------- -----------------
Trade and other receivables 23,342 12,584 21,003
------------------------------------------------------- ------- ------------- ------------- -----------------
Cash and cash equivalents 10,079 8,512 8,853
------------------------------------------------------- ------- ------------- ------------- -----------------
Total current assets 52,462 31,631 42,756
------------------------------------------------------- ------- ------------- ------------- -----------------
Total assets 73,646 53,630 63,652
------------------------------------------------------- ------- ------------- ------------- -----------------
Current liabilities
----------------------------------------------------- ------- ------------- ------------- -----------------
Other interest-bearing loans and borrowings (2,210) (3,686) (2,774)
------------------------------------------------------- ------- ------------- ------------- -----------------
Trade and other payables (20,627) (10,019) (17,199)
------------------------------------------------------- ------- ------------- ------------- -----------------
Tax payable (1,335) (597) (1,033)
------------------------------------------------------- ------- ------------- ------------- -----------------
Total current liabilities (24,172) (14,302) (21,006)
------------------------------------------------------- ------- ------------- ------------- -----------------
Non-current liabilities
----------------------------------------------------- ------- ------------- ------------- -----------------
Other interest-bearing loans and borrowings (6,153) (8,183) (6,148)
------------------------------------------------------- ------- ------------- ------------- -----------------
Provisions (750) (750) (750)
------------------------------------------------------- ------- ------------- ------------- -----------------
Deferred tax liabilities (1,385) (1,615) (1,442)
------------------------------------------------------- ------- ------------- ------------- -----------------
Total non-current liabilities (8,288) (10,548) (8,340)
------------------------------------------------------- ------- ------------- ------------- -----------------
Total liabilities (32,460) (24,850) (29,346)
------------------------------------------------------- ------- ------------- ------------- -----------------
Net assets 41,186 28,780 34,306
------------------------------------------------------- ------- ------------- ------------- -----------------
Equity attributable to equity holders of the parent
------------------------------------------------------- ------- ------------- ------------- -----------------
Share capital 4 106 105 105
------------------------------------------------------- ------- ------------- ------------- -----------------
Share premium 6,034 5,623 5,676
------------------------------------------------------- ------- ------------- ------------- -----------------
Share based payments reserve 851 620 782
------------------------------------------------------- ------- ------------- ------------- -----------------
Retained earnings 33,875 22,365 28,192
------------------------------------------------------- ------- ------------- ------------- -----------------
Translation reserve 320 65 (455)
------------------------------------------------------- ------- ------------- ------------- -----------------
41,186 28,778 34,300
----------------------------------------------------- ------- ------------- ------------- -----------------
Non-controlling interest - 2 6
------------------------------------------------------- ------- ------------- ------------- -----------------
Total equity 41,186 28,780 34,306
------------------------------------------------------- ------- ------------- ------------- -----------------
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS'
EQUITY
FOR THE SIX MONTHSED 30 JUNE 2017, 31 DECEMBER 2016 AND 30 JUNE
2016
Share Share Translation Share Retained Total Non-controlling Total
capital premium reserve based earnings parent interests equity
payments equity
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
$000 $000 $000 $000 $000 $000 $000 $000
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Balance at 1
January 2016 104 5,181 (408) 470 20,299 25,646 5 25,651
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
comprehensive
income for the
period
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Profit - - - - 3,466 3,466 (3) 3,463
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Other
comprehensive
income - - 473 - - 473 - 473
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
comprehensive
income for
the period - - 473 - 3,466 3,939 (3) 3,936
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Transactions
with owners,
recorded
directly in
equity
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Share based
payments - - - 150 - 150 - 150
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Dividend paid - - - - (1,400) (1,400) - (1,400)
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Exercise of
options 1 442 - - - 443 - 443
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
contributions
by and
distributions
to owners 1 442 - 150 (1,400) (807) - (807)
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Balance at 30
June 2016 105 5,623 65 620 22,365 28,778 2 28,780
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Balance at 1
July 2016 105 5,623 65 620 22,365 28,778 2 28,780
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
comprehensive
income for the
period
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Profit - - - - 5,827 5,827 4 5,831
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Other
comprehensive
income - - (520) - - (520) - (520)
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
comprehensive
income for
the period - - (520) - 5,827 5,307 4 5,311
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Transactions
with owners,
recorded
directly in
equity
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Share based
payments - - - 162 - 162 - 162
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Dividend paid - - - - - - - -
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Exercise of
options - 53 - - - 53 - 53
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
contributions
by and
distributions
to owners - 53 - 162 - 215 - 215
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Balance at 31
December 2016 105 5,676 (455) 782 28,192 34,300 6 34,306
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Balance at 1
January 2017 105 5,676 (455) 782 28,192 34,300 6 34,306
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
comprehensive
income for the
period
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Profit - - - - 7374 7,374 (6) 7,368
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Other
comprehensive
income - - 775 - - 775 - 775
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
comprehensive
income for
the period - - 775 - 7,374 8,149 (6) 8,143
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Transactions
with owners,
recorded
directly in
equity
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Share based
payments - - - 69 - 69 - 69
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Dividend paid - - - - (1,691) (1,691) - (1,691)
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Exercise of
options 1 358 - - - 359 - 359
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Total
contributions
by and
distributions
to owners 1 358 - 69 (1,691) (1,263) - (1,263)
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
Balance at 30
June 2017 106 6,034 320 851 33,875 41,186 - 41,186
--------------- ---------- ---------- ------------ --------- ---------- ---------- ---------------- ----------
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHSED 30 JUNE 2017 AND 2016 AND YEARED 31
DECEMBER 2016
30 June 2017 30 June 2016 31 December 2016
Note
---------------------------------------------------- -------- ------------- ------------- -----------------
$000 $000 $000
------------------------------------------------------------- ------------- ------------- -----------------
Cash flows from operating activities
------------------------------------------------------ -------- ------------- ------------- -----------------
Profit for the period 7,374 3,466 9,293
---------------------------------------------------------------- ------------- ------------- -----------------
Adjustments for:
---------------------------------------------------- -------- ------------- ------------- -----------------
Depreciation, amortisation and impairment 1,214 1,197 2,694
------------------------------------------------------ -------- ------------- ------------- -----------------
Taxation expense 1,359 929 2,370
---------------------------------------------------------------- ------------- ------------- -----------------
Financial expense 156 217 371
---------------------------------------------------------------- ------------- ------------- -----------------
Equity settled share based payment expenses 69 150 312
------------------------------------------------------ -------- ------------- ------------- -----------------
10,172 5,959 15,040
------------------------------------------------------------- ------------- ------------- -----------------
(Increase)/decrease in trade and other receivables (2,339) 6,900 (1,292)
------------------------------------------------------ -------- ------------- ------------- -----------------
(Increase)/decrease in inventories (6,141) (1,250) (3,436)
------------------------------------------------------ -------- ------------- ------------- -----------------
Increase/(decrease) in trade and other payables 3,981 (4,665) 1,644
------------------------------------------------------ -------- ------------- ------------- -----------------
5,673 6,944 11,956
------------------------------------------------------------- ------------- ------------- -----------------
Interest paid (156) (217) (371)
---------------------------------------------------------------- ------------- ------------- -----------------
Tax paid (1,196) (658) (1,489)
---------------------------------------------------------------- ------------- ------------- -----------------
Net cash from operating activities 4,321 6,069 10,096
------------------------------------------------------ -------- ------------- ------------- -----------------
Cash flows from investing activities
---------------------------------------------------- -------- ------------- ------------- -----------------
Acquisition of subsidiary, net of cash acquired - - 58
------------------------------------------------------ -------- ------------- ------------- -----------------
Acquisition of property, plant and equipment (253) (128) (425)
------------------------------------------------------ -------- ------------- ------------- -----------------
Acquisition of intangible assets (951) (464) (1,017)
------------------------------------------------------ -------- ------------- ------------- -----------------
Net cash used in investing activities (1,204) (592) (1,384)
------------------------------------------------------ -------- ------------- ------------- -----------------
Cash flows from financing activities
---------------------------------------------------- -------- ------------- ------------- -----------------
Proceeds from new loan - 539 -
---------------------------------------------------- -------- ------------- ------------- -----------------
Repayment of borrowings (559) (408) (2,816)
---------------------------------------------------------------- ------------- ------------- -----------------
Dividends paid (1,691) (1,400) (1,400)
---------------------------------------------------------------- ------------- ------------- -----------------
Exercise of options 359 443 496
---------------------------------------------------------------- ------------- ------------- -----------------
Net cash used in financing activities (1,891) (826) (3,720)
------------------------------------------------------ -------- ------------- ------------- -----------------
Net increase in cash and cash equivalents 1,226 4,651 4,992
------------------------------------------------------ -------- ------------- ------------- -----------------
Cash and cash equivalents at 1 January 8,853 3,861 3,861
------------------------------------------------------ -------- ------------- ------------- -----------------
Cash and cash equivalents at period end 10,079 8,512 8,853
------------------------------------------------------ -------- ------------- ------------- -----------------
General information and reporting entity
Quixant Plc ("Quixant") is a Public Limited Company incorporated
and domiciled in England and Wales, whose shares are publicly
traded on the Alternative Investment Market (AIM) of the London
Stock Exchange. The address of the Company's registered office is
Aisle Barn, 100 High Street, Balsham, Cambridge, CB21 4EP. Quixant
is a leading provider of innovative, highly engineered technology
products principally for the global gaming industry. The Group
designs and manufactures highly optimised computing solutions and
monitors. In November 2015 Quixant acquired Densitron Technologies,
which has a strong heritage in the sale of electronic display
solutions to global industrial markets. This condensed consolidated
interim financial information for the Quixant Group comprises the
Company, its branch in Taiwan and its subsidiaries (the
"Group").
The condensed consolidated interim financial information is
neither audited nor reviewed and the results of operations for the
six months ended 30 June 2017 are not necessarily indicative of the
operating results for future operating periods. The condensed
consolidated interim financial information has not been reviewed
under IRSE 2410.
The financial information shown for the year ended 31 December
2016 in the interim financial information does not constitute full
statutory financial statements as defined in Section 434 of the
Companies Act 2006 and has been extracted from the Company's annual
report and accounts. The Auditor's Report on the annual report and
accounts was unqualified.
1. Principal accounting policies
Statement of compliance
This condensed consolidated interim financial report has been
prepared in accordance with IAS 34 Interim Financial Reporting.
Selected explanatory notes are included to explain events and
transactions that are significant to an understanding of the
changes in financial position and performance of the Group since
the last annual consolidated financial statements as at and for the
year ended 31 December 2016. This condensed consolidated interim
financial report does not include all the information required for
full annual financial statements prepared in accordance with
International Financial Reporting Standards. The reporting currency
adopted by the Quixant Group is the US dollar as this is the
trading currency of the Group.
This condensed consolidated interim financial report was
approved by the Board of Directors on 21 September 2017.
Judgements and estimates
Preparing the interim financial report requires management to
make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of
assets and liabilities, income and expenses. Actual results may
differ from these estimates.
The preparation of financial information requires the use of
certain critical accounting estimates. It also requires management
to exercise its judgement in the process of applying the Quixant
Group accounting policies. The areas involving a higher degree of
judgement and estimation continue to relate to determining the
point at which the criteria for development cost capitalisation
have been met and inventory and bad debt provisions respectively.
In addition, management considers the recoverable amount of
goodwill and the assessment of the contingent consideration payable
to be judgemental areas. Goodwill is reviewed for impairment at
each reporting date or when indicators of impairment arise.
Segmental analysis
The Quixant Group determines and presents operating segments
based on the information that internally is provided to the
executive management team, the body which is considered to be the
Quixant Group's Chief Operating Decision Maker ("CODM"). An
operating segment is a component of the Quixant Group that engages
in business activities from which it may earn revenues and incur
expenses, including revenues and expenses that relate to
transactions with any of the Quixant Group's other components. The
operating segments' operating results are reviewed regularly by the
CODM to make decisions about resources to be allocated to the
segment, to assess its performance and for which discrete financial
information is available. The financial information of the
operating segments is set out in Note 2.
Significant accounting policies
The accounting policies applied by the Group in this condensed
consolidated interim financial report are the same as those applied
by the Group in its consolidated financial statements as at and for
the year ended 31 December 2016.
Reconciliation of earnings before interest, tax, depreciation
and amortisation (EBITDA) and profit before tax (PBT)
EBITDA, adjusted EBITDA, PBT and adjusted PBT for the current
and prior periods has been derived as follows:
EBITDA PBT
---------------- ------------------------------------------------- -------------------------------------------------
6 months ended 6 months ended 12 months 6 months ended 6 months ended 12 months
30 June 2017 30 June 2016 ended 31 30 June 2017 30 June 2016 ended 31
December 2016 December 2016
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
$000 $000 $000 $000 $000 $000
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Profit for the
period 7,374 3,466 9,293 7,374 3,466 9,293
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Adding back:
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Taxation
expense 1,359 929 2,370 1,359 929 2,370
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Financial
expenses 156 217 371 - - -
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Depreciation 293 164 465 - - -
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Amortisation of
intangible
assets 477 419 1,001 - - -
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Amortisation of
customer
relationships
and order
backlog 444 614 1,228 - - -
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
EBITDA/PBT 10,103 5,809 14,728 8,733 4,395 11,663
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Amortisation of
customer
relationships
and order
backlog - - - 444 614 1,228
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Share based
payments
expense 69 150 312 69 150 312
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Settlement of
claim - - (377) - - (377)
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Termination
payment and
discontinued
products - - 987 - - 987
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Adjusted
EBITDA/PBT 10,172 5,959 15,650 9,246 5,159 13,813
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
2. Business and geographical segments
The Chief Operating Decision Maker in the organisation is an
executive management committee comprising the Board of Directors.
They have determined the operating segments detailed within this
report on which the business is managed. The Group assesses the
performance of the segments based on a measure of revenue and PBT.
The principal divisions are the Quixant Gaming division, which is
the core gaming business, and the Densitron division, which
comprises the Densitron operating segments in Europe, America,
France and Japan. No single customer accounted for more than 20% of
total revenue for the six months to 30 June 2017. The operating
segments applicable to the Group are as follows:
-- Quixant Gaming
-- Densitron Europe
-- Densitron America
-- Densitron France
-- Densitron Japan
Quixant Gaming Densitron Densitron Densitron Densitron Total
Europe America France Japan
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
$000 $000 $000 $000 $000 $000
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
6 months to 30 June
2017
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Revenue 37,811 5,652 7,390 3,302 2,748 56,903
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Profit/(loss) before
tax 7,584 (333) 806 449 227 8,733
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
As at 30 June 2017
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Assets 58,900 5,343 4,310 2,772 2,321 73,646
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Liabilities (22,168) (6,350) (1,920) (1,438) (584) (32,460)
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Net
assets/(liabilities) 36,732 (1,007) 2,390 1,334 1,737 41,186
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
6 months to 30 June
2016
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Revenue 21,203 6,373 8,330 2,483 2,941 41,330
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Profit/(loss) before
tax 3,273 (125) 709 270 268 4,395
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
As at 30 June 2016
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Assets 39,870 5,807 3,760 2,094 2,099 53,630
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Liabilities (14,417) (6,612) (2,015) (1,268) (538) (24,850)
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Net
assets/(liabilities) 25,453 (805) 1,745 826 1,561 28,780
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
12 months to 31
December 2016
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Revenue 53,003 11,174 15,212 5,429 5,547 90,365
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Profit/(loss) before
tax 9,594 (601) 1,272 984 414 11,663
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
As at 31 December
2016
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Assets 49,692 4,576 4,419 2,944 2,021 63,652
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Liabilities (18,655) (6,252) (2,014) (1,853) (572) (29,346)
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
Net
assets/(liabilities) 31,037 (1,676) 2,405 1,091 1,449 34,306
---------------------- --------------- --------------- --------------- --------------- --------------- ---------
3. Taxation
6 months ended 30 June 2017 6 months ended 30 June 2016 Year ended
31 December 2016
----------------------------- ---------------------------- ---------------------------- ------------------
$000 $000 $000
----------------------------- ---------------------------- ---------------------------- ------------------
Analysis of charge in
periods
----------------------------- ---------------------------- ---------------------------- ------------------
Current tax
----------------------------- ---------------------------- ---------------------------- ------------------
UK corporation tax 708 557 1,401
-------------------------------- ---------------------------- ---------------------------- ------------------
Foreign tax 749 398 1,012
-------------------------------- ---------------------------- ---------------------------- ------------------
Adjustments for prior periods - - (175)
-------------------------------- ---------------------------- ---------------------------- ------------------
Current tax 1,457 955 2,238
-------------------------------- ---------------------------- ---------------------------- ------------------
Deferred tax (credit)
----------------------------- ---------------------------- ---------------------------- ------------------
Origination and reversal of
temporary differences (98) (26) 132
------------------------------- ---------------------------- ---------------------------- ------------------
Deferred tax (credit) (98) (26) 132
-------------------------------- ---------------------------- ---------------------------- ------------------
Total tax expense 1,359 929 2,370
-------------------------------- ---------------------------- ---------------------------- ------------------
4. Share capital
6 months ended 30 June 2017 6 months ended 30 June 2016 Year ended
31 December 2016
-------------------------------- ------------------------------ ------------------------------ --------------------
Number $000 Number $000 Number $000
-------------------------------- -------------------- -------- -------------------- -------- ------------- -----
Allocated, called up and fully
paid
-------------------------------- -------------------- -------- -------------------- -------- ------------- -----
Balance at 1 January 2017 65,364,782 105 64,634,782 104 64,634,782 104
-------------------------------- -------------------- -------- -------------------- -------- ------------- -----
Issue of new shares as a result
of exercise of employee share
options 565,200 1 640,400 1 730,000 1
-------------------------------- -------------------- -------- -------------------- -------- ------------- -----
Balance at 30 June 2017 65,929,982 106 65,275,182 105 65,364,782 105
-------------------------------- -------------------- -------- -------------------- -------- ------------- -----
The Company paid a dividend of 2.0p per share for the year ended 31 December 2016 on 18 May
2017.
----------------------------------------------------------------------------------------------------------------------
5. Earnings per share
6 months ended 30 June 2017 6 months ended 30 June 2016 Year ended
31 December 2016
----------------------------- ---------------------------- ---------------------------- ------------------
$000 $000 $000
----------------------------- ---------------------------- ---------------------------- ------------------
Earnings
----------------------------- ---------------------------- ---------------------------- ------------------
Earnings for the purposes of
basic and diluted EPS being
net profit attributable to
equity
shareholders 7,368 3,463 9,294
------------------------------- ---------------------------- ---------------------------- ------------------
Number of shares
----------------------------- ---------------------------- ---------------------------- ------------------
Weighted average number of
ordinary shares for the
purposes of basic EPS 65,542,773 64,691,392 65,004,414
------------------------------- ---------------------------- ---------------------------- ------------------
Effect of dilutive potential
ordinary shares:
------------------------------- ---------------------------- ---------------------------- ------------------
Share options 1,123,407 1,852,249 1,614,766
-------------------------------- ---------------------------- ---------------------------- ------------------
Weighted number of ordinary
shares for the purposes of
diluted EPS 66,666,180 66,543,641 66,619,180
------------------------------- ---------------------------- ---------------------------- ------------------
Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders
by the weighted average number of shares outstanding during the period.
----------------------------------------------------------------------------------------------------------------
6. Related party transactions
In June 2016, two directors entered into a related party
transaction. The wife of G P Mullins rented a house to a subsidiary
company at a rent of GBP2,500 per calendar month. The rent payable
is determined on an arm's length basis. The subsidiary company
provides the house rent free for the use of J F Jayal.
There were no other related party transactions, other than
transactions with key management personnel, who are the Directors
of the Company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DMGZLKGGGNZM
(END) Dow Jones Newswires
September 21, 2017 02:00 ET (06:00 GMT)
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