TIDMSOG
RNS Number : 0587G
StatPro Group PLC
03 August 2016
3 August 2016
StatPro Group plc
StatPro Revolution revenue up 64% as momentum builds
StatPro Group plc, (AIM: SOG, "StatPro", "the Group"), the
leading provider of portfolio analysis and asset pricing services
for the global asset management industry, has published its interim
results for the six months ended 30 June 2016.
Six months Six months Change Constant
ended 30 ended 30 currency
June 2016 June 2015 (5)
GBP17.55 GBP15.44
Revenue m m +14% +11%
GBP4.02 GBP2.45
* StatPro Revolution - underlying m m +64% +62%
GBP8.99 GBP10.27
* StatPro Seven - underlying m m -12% -15%
GBP1.73 - n/a
* Revenue from acquisitions m
Annualised Recurring GBP36.17 GBP28.62
Revenue ("ARR") (1) m m +26% +13%
GBP2.05 GBP1.73
Adjusted EBITDA (3) m m +19% +13%
(Loss)/profit before GBP(0.96) GBP0.82 n/a n/a
tax m m
Basic (loss)/earnings
per share (1.2)p 0.8p n/a
Adjusted earnings
per share (3) 1.1p 1.0p +10%
Interim dividend
per share 0.85p 0.85p -
--------------------------------------------- ----------- ----------- ------- ----------
Financial highlights:
-- Group revenue up 14% to GBP17.55 million (2015: GBP15.44 million)
-- StatPro Revolution underlying revenue up 64% to GBP4.02 million (2015: GBP2.45 million)
-- Group ARR up 26% to GBP36.17 million (2015: GBP28.62
million), 13% on a constant currency basis
-- ARR from cloud services (StatPro Revolution and Investor
Analytics) up 112% to GBP13.72 million (2015:
GBP6.47 million), 90% on a constant currency basis
-- Recurring revenue from cloud services now 38% of Group ARR (2015: 23%)
-- Adjusted EBITDA increased by 19% to GBP2.05 million (2015: GBP1.73 million)
-- Loss before tax GBP0.96 million (2015: profit GBP0.82
million) after exceptional items of GBP1.24 million (2015: nil) and
acquired intangible assets amortisation of GBP0.55 million (2015:
GBP0.03 million)
-- Interim dividend maintained at 0.85 pence per share
Operating highlights:
-- Two large contracts signed including new StatPro Revolution
Performance module, demonstrating the
endorsement of StatPro's cloud strategy by large fund
administrators
-- Launch of Revolution Performance on track for Q3 2016
-- Continued focus on revenue per client; average annualised
revenue for StatPro Revolution clients increased 82% to GBP43,600
(2015: GBP23,900 (5) )
-- Lifetime Value: Cost of Acquiring Customers (LTV:CAC) (2)
rose to 10.8 from 10.1 - three or higher is
considered acceptable for successful SaaS business
-- Increased bank facility with Wells Fargo to GBP24.8 million
Outlook:
-- Forward order book of contracted revenue (4) increased 19% to
GBP44.13 million (2015: GBP37.01 million), 8% on a constant
currency basis
o GBP21.91 million is contracted revenue for StatPro Revolution,
an increase of 86%, 69% on a constant currency basis
(1) Annualised Recurring Revenue is the annual value of revenue
contractually committed at period end.
(2) The Cost of Acquiring Customers ("CAC") is determined by the
selling and other costs associated with contracting new clients and
dividing by the number of clients signed in the period. The
Lifetime Value of the customer contracts ("LTV") is determined by
estimating the average life based on churn rates
multiplied by the average ARR per client.
(3) Adjusted EBITDA and adjusted earnings per share are EBITDA
and earnings per share after adjustment for amortisation of
acquired intangible assets,
exceptional items and share based payments (notes 2 and 5).
(4) Forward order book of contracted revenue is the total amount
of software and professional services revenue that is contractually
committed at period end.
(5) At constant currency, based on restating the prior year at
the closing or average currency rate.
Justin Wheatley, Chief Executive of StatPro, commented:
"Our strategy to convert our portfolio analytics and risk
services to the cloud has secured us a significant technological
lead in our market.
"As a result, we offer our clients a materially better and
simpler service. The scale, speed and control of Revolution provide
asset managers with huge productivity gains. We have recently
signed agreements with two more leading fund administrators - a
clear endorsement of our capabilities.
"We are gaining momentum, as demonstrated by the 64% jump in
Revolution's revenue and are extremely well positioned in a growing
market. This is reflected in our forward order book of GBP44.13
million, up 19% - of which GBP21.91 million is contracted revenue
for StatPro Revolution, an increase of 86%.
"We look forward to the launch of StatPro Revolution Performance
in September."
Enquiries:
StatPro Group plc
Justin Wheatley, Chief
Executive 020 8410 9876
Andrew Fabian, Finance
Director
Panmure Gordon - Nomad
and Broker
Corporate Finance - Freddy
Crossley / Fred Walsh 020 7886 2500
Corporate Broking - Tom
Salvesen
Instinctif Partners
Adrian Duffield / Lauren
Foster 020 7457 2020
About StatPro
StatPro is a global provider of award winning portfolio
analytics solutions for the investment community. The Group's
cloud-based platform provides vital analysis of portfolio
performance, attribution, risk and compliance. This multi-asset
class analytics platform helps StatPro's clients increase assets
under management, improve client service, meet tough regulations
and reduce costs.
The Group's integrated and global data coverage includes over
3.2 million securities such as equities, bonds, mutual funds, FX
rates, futures, options, OTCs, sector classifications and much else
besides. StatPro also covers most families of benchmarks including
MSCI, FTSE, Russell, NASDAQ and the licence free Freedom Index.
StatPro has grown its Annualised Recurring Revenue from less
than GBP1 million in 1999 to around GBP36 million at end June 2016.
The Group has operations in Europe, North America, South Africa,
Asia and Australia, with hundreds of clients in 37 countries around
the world. Approximately 80% of recurring revenues are generated
outside the UK. StatPro Group plc shares are listed on AIM.
Overview
StatPro had a good first half in 2016. Revenues increased 14% to
GBP17.55 million (11% constant currency "CC") and adjusted EBITDA
rose 19% to GBP2.05 million (13% CC). Once more, 93% of Group
revenue in H1 2016 was derived from recurring revenue (2015:
93%).
Revenues from StatPro Revolution increased 64% to GBP4.02
million (62% CC) (2015: GBP2.45 million). That was offset by the
expected reduction of StatPro Seven revenues to GBP8.99 million
(15% CC) (2015: GBP10.27 million).
More importantly as a leading indicator, ARR increased 26% to
GBP36.17 million (13% CC) with the ARR for the Group's cloud
services rising 112% to GBP13.72 million (90% CC).
The Group signed large contracts towards the end of H1 2016 that
included the new StatPro Revolution Performance module with two
leading international fund administrators. These are clear
endorsements of the Group's cloud strategy.
StatPro's business has exhibited high levels of client renewals
(94%) and strong SaaS ratios such as Lifetime Value: Cost of
Acquiring Customers (LTV: CAC) ratio, which rose to 10.8 from 10.1.
This ratio estimates the expected lifetime revenue generated per
client divided by the cost of acquiring the client.
Strategy
StatPro provides portfolio analysis and data for the
international asset management industry, a highly regulated and
expanding sector. Its sophisticated solutions address the
complexity of investment processes driven by a number of industry
factors including multi-jurisdictional compliance, regulatory
change and rising demand for cloud-based reporting and
analysis.
Demand from the asset management industry for StatPro products
is driven by the increasing requirement for more types of analysis,
as well as the need for greater levels of accuracy, faster delivery
of analysis, and data and regulatory requirements.
The Group's strategy is built upon its early move to cloud
technology. By making this investment, eight years ago, the Group
has positioned itself strongly, well ahead of its competition.
StatPro's solution of a simple online service means that clients
do not have to deal with the complexity of managing multiple
software solutions or the expense of internal IT and data
management.
The scalability, speed and data control that StatPro Revolution
offers clients is unmatched. StatPro believes that these benefits
appeal mostly to the largest financial institutions.
The Group considers the risk of its clients rejecting
cloud-based services is now negligible. StatPro has observed that
many clients have begun to consider installed software as a
hindrance to their business efficiency.
Current trading and outlook
The Group's contracted order book is up 19% to GBP44.13 million
(CC 8%) of which the StatPro Revolution contracted order book
increased 86% to GBP21.91 million (CC 69%).
New sales of GBP8.66 million were made in the first half of
2016, an increase of 25% (2015: GBP6.94 million) of which GBP6.38
million was for StatPro Revolution, an increase of 56% (2015:
GBP4.09 million). This improvement is a direct result of StatPro
Revolution maturing and gaining widespread acceptance as a high
quality platform for portfolio analytics and risk compliance.
The Group's current pipeline is larger than at any time. More
than two thirds of sales by value are to clients who have already
bought StatPro Revolution. With recurring revenues of 93%, StatPro
continues to be profitable and cash generative.
Overall, the Group is trading in line with the Board's
expectations after a strong start to the year.
Operational review
StatPro Revolution
StatPro made two releases of StatPro Revolution in the first
half of the year, which introduced significant new functionality
for risk and benchmark management. The forthcoming release in
August will add the power of Hadoop(R) to the calculation module as
this allows for parallel processing.
The Group has also made extensive improvements to the core
database that will enable a huge increase in the storage of client
data, which in turn will result in significantly faster response
times.
The September launch of StatPro Revolution Performance marks the
end of a long investment process and the point from which the Group
can begin the physical conversion of clients to the full Revolution
platform. To date, clients have used a combination of StatPro Seven
for data management and Revolution for analytics. They will then be
able to discontinue their use of StatPro Seven and so maximise the
full benefit of the cloud. This process will take a number of years
to complete.
StatPro Seven
StatPro Seven consists of seven modules, three of which are the
focus of the Group's present migration to StatPro Revolution, (SPA,
SFI and SRM), representing approximately GBP7.52 million of ARR
(2015 CC: GBP10.03 million). Approximately half of StatPro's
clients of SPA, SFI and SRM, by value, have now contracted to take
StatPro Revolution.
The other four modules of StatPro Seven represent approximately
GBP10.84 million of ARR (2015 CC: GBP10.67 million), including
InfoVest's other products amounting to GBP0.38 million and are not
currently planned for migration. Of these other four modules, the
Group continues to market StatPro Composites (SC) extensively.
StatPro Portfolio Control (SPC) was transferred to Infovest in
February to acquire 51% of its equity and StatPro expects to see
further growth for this product as a result.
Data
ARR for the data services the Group provides for valuations,
index distribution and complex asset pricing is approximately
GBP4.54 million (2015 CC: GBP4.43 million).
Acquisitions
Investor Analytics ("IA")
The Group has completed the integration of IA. The cost of the
integration and other one-off costs have been taken in the
exceptional charge in the first half.
Work is on-going for the integration of IA's cloud service with
StatPro Revolution and the Group is on schedule to offer a unified
solution by early 2017.
As previously stated, the Group expects that IA will make a
positive EBITDA contribution for the full year.
Infovest
Infovest as planned, operates as a separately branded company.
However, the products it supplies, Compliance, Data Warehouse, ETL
tools and Reporting, are closely aligned with StatPro's
services.
The Group has implemented an effective cross-marketing process
to ensure that Infovest's sales team gets full access to StatPro's
extensive worldwide client base. This has already yielded several
sales since March, including Capita Fund Services.
The majority of its prospects are StatPro clients. The Group
expects Infovest to make a positive contribution to Group EBITDA
for the year as a whole.
Financial review
Revenue
Group revenue increased by 14% to GBP17.55 million (2015:
GBP15.44 million). The revenue growth was driven by strong
underlying growth in StatPro Revolution combined with the positive
impact of the acquisitions, offset by the expected reduction in
revenue for StatPro Seven as shown below.
Revenue bridge GBPm
H1 2015 at actual
rates 15.44
Change year
Underlying growth on year
StatPro Revolution 1.54 62%
StatPro Seven
(and other) (1.53) -15%
Impact of acquisitions % of prior
and fx year
Acquisitions 1.73 11%
FX impact 0.37 2%
-------
2.11
------
H1 2016 at actual
rates 17.55
------
The underlying growth in StatPro Revolution revenue was 62% at
constant currency (64% at actual rates), while the revenue for
StatPro Seven reduced by 15% at constant currency (12% at actual
rates), as shown in the table below.
` Unaudited Unaudited
Revenue analysis Six Six
months months
to 30 to 30
June June*
2016 2015 Change/impact
on revenue
GBPm GBPm %
StatPro Revolution - core excluding
IA 4.02 2.48 +62%
StatPro Seven (and other) 8.99 10.54 -15%
Data and professional fees 2.81 2.79 -
---------- ----------
15.82 15.81 -
Acquisitions 1.73 -
---------- ----------
17.55 15.81 +11%
FX impact - (0.37)
---------- ----------
Total revenue 17.55 15.44 +14%
========== ==========
* at constant currency
93% of Group revenue in H1 2016 was recurring revenue (2015:
93%).
Contracted revenue
The Group achieved strong sales in H1 2016 with total contracted
value of GBP8.66 million (2015: GBP6.94 million). The level of
contracted sales for StatPro Revolution was GBP6.38 million (2015:
GBP4.09 million), driven by two international banner deals,
demonstrating the endorsement by large fund administrators of
StatPro's platform solution including StatPro Revolution
Performance. As a result, the forward order book of contracted
revenue increased by 19% to GBP44.13 million (2015: GBP37.01
million) and by 8% at constant currency. The forward order book of
contracted revenue for StatPro Revolution increased by 86% to
GBP21.91 million (2015: GBP11.75 million) and by 69% at constant
currency.
The proportion by value of recurring revenue contracts at the
end of June 2016 secured to the end of June 2017 or beyond is 70%
(2015: 72%); the weighted average length of contracts committed was
15 months (2015: 16 months).
Approximately 83% of new recurring contracted revenue came from
existing clients (2015: 82%). Professional services revenue
increased to GBP1.16 million (2015: GBP1.04 million).
Recurring revenue
The Group's SaaS business model of recurring revenue contracts
continues to provide excellent visibility of revenue. The ARR at
the end of June 2016 increased by 26% over the previous 12 months
at constant currency to GBP36.17 million (2015: GBP28.62 million).
Excluding the impact of acquisitions and currency rates, the
organic growth in Group ARR was 1%.
The net growth rate for StatPro Revolution was 112% (2015: 61%).
The organic growth in StatPro Revolution ARR was 47%, excluding the
impact of acquisitions and currency rates.
The ARR for StatPro Seven before the impact of conversions to
StatPro Revolution was GBP19.57 million, a 6% reduction at constant
currency (2015: 1% reduction). After the impact of conversions to
StatPro Revolution, StatPro Seven annualised recurring revenue was
GBP17.98 million (2015: GBP18.67 million).
The ARR from cloud services (StatPro Revolution and IA) is now
38% of the Group total (2015: 23%) and has grown at a higher rate
than other revenues as the service is developed on a highly
scalable technology platform.
The total recurring revenue from clients whose subscription
includes StatPro Revolution, was GBP21.60 million (2015: GBP13.10
million) representing 67% (2015: 52%) of total software recurring
revenue.
There has been a significant increase (82%) in average revenue
per StatPro Revolution client to GBP43,600 (2015: GBP23,900 at
constant currency) including the impact of IA, where average
revenue per IA client is approximately GBP75,800. The organic
growth of average ARR for Revolution was 62%.
SaaS-based KPIs
The Group has pioneered the introduction of key SaaS metrics.
One such measure used by SaaS businesses is to estimate the costs
of acquiring each customer ("CAC") and to compare that with the
Lifetime Value of the customer contracts ("LTV"). The results for
StatPro are presented below for June 2016 on a 12 month trailing
basis.
Unaudited Unaudited
All contracts
Year Year
to to
30 30
June June
2016 2015
Average Cost of Acquiring
Customer ("CAC") (GBP'000s) 48.2 54.4
Implied Customer Lifetime
(years) 6.8 9.2
Average ARR per customer
(GBP'000s) 76.1 59.7
Implied Customer Lifetime
Value ("LTV") (GBP'000s) 521 551
LTV: CAC 10.8 10.1
Generally a value of three or higher for the ratio of LTV:CAC is
considered the industry benchmark for a successful SaaS business
and for StatPro it is well above this figure.
Operating expenses
Operating expenses (before amortisation of intangible assets and
exceptional items) increased by 14% (12% at constant currency) to
GBP14.54 million (2015: GBP12.74 million). GBP1.42 million (11%) of
the increase was related to the acquisitions. Other increases in
expenditure related to the investment in cloud technology, data
costs, software and communications costs and cloud infrastructure.
The average number of employees was 255 (2015: 245).
Exceptional items
Exceptional items amounting to a total of GBP1.24 million were
incurred. These include: GBP1.06 million related to the acquisition
of IA, of which GBP0.47 million related to transaction costs and
the remainder related to reorganisation costs, redundancies and
onerous leases. GBP0.44 million relating to a reorganisation of the
Paris office including redundancy costs and onerous leases; and a
credit of GBP0.26 million arose related to the negative goodwill on
the InfoVest acquisition. The tax credit on the exceptional items
was GBP0.39 million.
Profitability
Adjusted EBITDA increased to GBP2.05 million (2015: GBP1.73
million). Gross profit margin for the period was 60% (2015: 61%) as
shown in note 5.
Finance income and expense
Net finance expense increased to GBP0.36 million (2015: GBP0.16
million), as a result of moving into net debt following the
financing of the IA acquisition and share buyback.
(Loss)/profit before tax
Adjusting for amortisation of acquired intangible assets,
exceptional items and share based payments, the adjusted profit
before taxation was flat year on year at GBP0.93 million (2015:
GBP0.93 million). Currency movements increased adjusted profit
before taxation by approximately GBP0.11 million. The loss before
taxation was GBP0.96 million (2015: profit GBP0.82 million), mainly
as a result of exceptional items of GBP1.24 million and
amortisation of acquired intangibles of GBP0.55 million.
Taxation
The tax credit was GBP0.25 million (2015: charge is GBP0.27
million). The overall effective tax rate is 26% (2015: 32%). The
underlying credit on adjusted profit before tax was approximately
13%. This is low primarily because of tax losses in the Group. The
effective tax rate relating to the exceptional charges was 32%.
Although tax cash payments in H1 2016 were higher than typical at
GBP1.42 million (2015: GBP0.67 million), the Group anticipates
receiving some refunds in H2 2016.
Earnings per share
Adjusted earnings per share was 1.1p (2015: 1.0p). Actual and
diluted losses per share was 1.2p (2015: earnings per share
0.8p).
Interim dividend
An interim dividend of 0.85 pence per ordinary share (2015: 0.85
pence) will be paid on 2 November 2016 to shareholders on the
register at the close of business on 7 October 2016 (ex-div date
will be 6 October 2016).
Balance sheet
The Group's net assets at the period end were GBP40.69 million
(2015: GBP42.49 million). The increase in gross assets was
primarily due to the increase in goodwill of GBP11.20 million (of
which GBP5.01 million related to acquisitions and GBP6.19 million
to revaluation) and other intangible assets amounting to GBP4.95
million. This main increase in the liabilities was the increase in
borrowings related to the acquisition of IA. There has also been a
large increase in deferred revenue, which is a non-cash liability
to GBP15.67 million (2015: GBP12.42 million). The deferred tax
liability increased to GBP2.20 million (2015: GBP0.50 million),
mainly due to the impact of the accounting for the acquired
intangible assets.
Cash flow and financing
StatPro continues to be cash generative with cash generated from
operations of GBP3.17 million before exceptional payments (2015:
GBP3.69 million), although lower than the prior year, mainly due to
lower working capital movements. The free cash flow (before
exceptional payments) was an outflow of GBP1.57 million (2015:
GBP0.78 million inflow). The free cash flow was negative in H1 2016
due to a higher level of investment in property, plant and
equipment and intangibles and a higher than normal level of tax
paid.
The Group ended the period with net debt of GBP9.14 million
(2015: net cash GBP2.03 million). The increase in net debt arose
because of the financing of the IA acquisition and share buyback
using the Group's debt facilities.
Financing facility
As part of the acquisition of IA in January 2016, the financing
facilities with Wells Fargo (originally completed in July 2015 and
available for acquisitions, share buybacks and general corporate
purposes), were increased. The key features of the facilities now
are:
-- Five year commitment period to July 2020
-- GBP10 million committed revolving credit facility
-- US$6.825 million committed term loan ($175,000 of original
loan was repaid on 30 June as planned)
-- US$3 million committed deferred drawdown loan
-- GBP7.5 million uncommitted additional facility available
The primary financial covenants are linked to recurring revenue
and adjusted EBITDA while allowing the Group to invest for growth.
The financing costs will be amortised over the five year term. This
facility strengthens the Group's long-term financial structure and
therefore the Board believes that the Group is well positioned to
manage the business risks.
Acquisitions
During H1 2016, StatPro completed two acquisitions.
Acquisition of Investor Analytics
On 21 January 2016, StatPro acquired the entire share capital of
Investor Analytics LLC, the US-headquartered, cloud-based risk
analytics company to hedge funds and asset managers.
Acquisition of majority control of InfoVest
With effect from 1 March 2016, StatPro South African business
acquired a 51% shareholding in InfoVest Consulting (Pty) Ltd, a
South African headquartered software provider, specialising in data
warehouse, ETL and reporting software for the asset management
industry.
Further details on these acquisitions are provided in note
9.
Share buyback
On 11 March 2016, the Group purchased 2,873,713 at a price of
72p per share. This was financed by its debt facility with Wells
Fargo.
Research and development and capex
The research and development team is now focused solely on the
Group's cloud-based solutions, the StatPro Revolution platform.
R&D expenditure reduced overall by 11% to GBP2.27 million as
planned (2015: GBP2.55 million), equating to 13% of Group revenue
(2015: 17%). Included within investment in intangible assets are
capitalised development costs of GBP1.87 million (2015: GBP1.67
million) and amortisation on internal development was GBP1.71
million (2015: GBP1.57 million). The Group expects that R&D
expenditure as a percentage of revenue will continue to decrease in
the future. Capital expenditure on property, plant and equipment
was GBP1.02 million (2015: GBP0.51 million).
Principal risks and uncertainties
The directors continue to evaluate the principal business risks
and uncertainties affecting the Group and further discussion of the
principal risks and uncertainties can be found on pages 28 to 31 of
the StatPro 2015 Annual Report. The result of the Brexit referendum
in the UK is not expected to have any adverse impact on the Group
and there has been a significant positive impact on the Group's ARR
due to fall in sterling since the result, as only 15% of the
Group's ARR is denominated in GBP.
Group Income Statement
For the six months ended 30 June 2016
Notes Unaudited Unaudited Unaudited Unaudited Audited
Six Six Six Six Year
months months months months to
to to to to 31
30 30 30 30 December
June June June June
2016 2016 2016 2015 2015
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
Continuing Acquisitions Total
operations
Revenue 3 15,818 1,728 17,546 15,444 30,187
Operating expenses
before amortisation
of intangible assets
and exceptional items (13,128) (1,417) (14,545) (12,741) (23,722)
Amortisation of acquired
intangible assets - (546) (546) (32) (32)
Amortisation of other
intangible assets (1,817) - (1,817) (1,688) (3,734)
Exceptional items 4 (438) (803) (1,241) - -
------------------------------------------ ------ ----------- ------------- ---------- ---------- ---------
Operating expenses (15,383) (2,766) (18,149) (14,461) (27,488)
----------- ------------- ---------- ---------- ---------
Operating profit/(loss) 435 (1,038) (603) 983 2,699
Finance income 7 5 9
Finance expense (364) (167) (299)
Net finance expense (357) (162) (290)
---------- ---------- ---------
(Loss)/profit before
taxation (960) 821 2,409
Taxation 252 (266) (788)
---------- ---------- ---------
(Loss)/profit for
the period (708) 555 1,621
========== ========== =========
Profit attributable 71 - -
to non-controlling
interests
(Loss)/profit attributable
to equity shareholders (779) 555 1,621
---------- ---------- ---------
(708) 555 1,621
========== ========== =========
Earnings per share
- basic 2 (1.2)p 0.8p 2.4p
-
diluted 2 (1.2)p 0.8p 2.4p
Group Statement of Comprehensive Income
For the six months ended 30 June 2016
Unaudited Unaudited Audited
Six months Six Year
to 30 months to 31
June to 30 December
June
2016 2015 2015
GBP'000s GBP'000s GBP'000s
(Loss)/profit for the period (708) 555 1,621
Other comprehensive income to
be reclassified to the income
statement:
Net exchange differences 4,864 (2,504) (4,012)
Total comprehensive income/(loss)
for the period 4,156 (1,949) (2,391)
=========== ========== ==========
Attributable to:
Non-controlling interests 71 - -
Equity shareholders 4,085 (1,949) (2,391)
Total comprehensive income/(loss)
for the period 4,156 (1,949) (2,391)
=========== ========== ==========
Group Balance Sheet
At 30 June 2016
Notes Unaudited Unaudited Audited
At 30 At 30 At 31
June June December
2016 2015 2015
GBP'000s GBP'000s GBP'000s
Non-current assets
Goodwill 10 53,656 43,644 42,460
Other intangible assets 10 11,107 5,788 6,153
Property, plant and equipment 2,895 2,375 2,233
Other receivables 237 101 147
Deferred tax assets 890 1,138 807
---------- ---------- ----------
68,785 53,046 51,800
Current assets
Trade and other receivables 9,211 6,607 8,264
Financial instruments - 58 -
- other
Current tax assets 1,042 - 198
Cash and cash equivalents 3,615 2,192 2,203
---------- ---------- ----------
13,868 8,857 10,665
Liabilities
Current liabilities
Financial liabilities
- borrowings (511) (63) (118)
Financial instruments
- other (283) (8) (41)
Trade and other payables (5,385) (4,942) (4,654)
Current tax liabilities (162) (608) (1,106)
Deferred income (15,631) (12,323) (13,217)
Provisions 11 (2,646) (705) (642)
(24,618) (18,649) (19,778)
---------- ---------- ----------
Net current liabilities (10,750) (9,792) (9,113)
---------- ---------- ----------
Non-current liabilities
Financial liabilities
- borrowings (12,245) (102) (801)
Other creditors (44) (60) (47)
Deferred tax liabilities (2,202) (503) (233)
Deferred income (41) (101) (89)
Provisions 11 (2,811) - -
---------- ---------- ----------
(17,343) (766) (1,170)
---------- ---------- ----------
Net assets 40,692 42,488 41,517
========== ========== ==========
Shareholders' equity
Share capital 12 678 678 678
Share premium 23,537 23,537 23,537
Shares to be issued 63 63 63
Treasury shares 12 (2,328) (249) (249)
Other reserves 5,627 4,200 2,692
Retained earnings 12,796 14,259 14,796
---------- ---------- ----------
Total shareholders' equity 40,373 42,488 41,517
---------- ---------- ----------
Non-controlling interests 319 - -
Total equity 40,692 42,488 41,517
========== ========== ==========
Group Statement of Cash Flows
For the six months ended 30 June 2016
Unaudited Unaudited Audited
Notes Six months Six Year
to 30 months to 31
June to 30 December
June
2016 2015 2015
GBP'000s GBP'000s GBP'000s
Operating activities
Cash generated from operations 6 2,291 3,690 6,548
Finance income 7 5 9
Finance costs (223) (25) (93)
Tax received - - -
Tax paid (1,421) (669) (832)
----------- ---------- ----------
Net cash flow from operating
activities 654 3,001 5,632
----------- ---------- ----------
Investing activities
Acquisition of subsidiaries (4,806) - -
(net of cash acquired)
Investment in intangible
assets (2,080) (1,708) (4,127)
Purchase of property, plant
and equipment (1,016) (513) (881)
Proceeds from the disposal
of property, plant and equipment - - 9
----------- ---------- ----------
Net cash flow used in investing
activities (7,902) (2,221) (4,999)
----------- ---------- ----------
Financing activities
Net proceeds from bank loan 10,797 - 639
Net proceeds from finance
leases 1,040 153 269
Proceeds from issue of ordinary
shares - 64 64
Purchase of own shares (2,079) - -
Dividends paid to shareholders (1,327) (1,386) (1,960)
----------- ---------- ----------
Net cash flow from/(used)
in financing activities 8,431 (1,169) (988)
----------- ---------- ----------
Net increase/(decrease) in
cash and cash equivalents 1,183 (389) (355)
----------- ---------- ----------
Cash and cash equivalents
at start of period 2,203 2,692 2,692
Effect of exchange rate movements 229 (111) (134)
----------- ---------- ----------
Cash and cash equivalents
at end of period 3,615 2,192 2,203
----------- ---------- ----------
Group Statement of Changes in Shareholders' Equity
For the six months ended 30 June 2016
Shares
to Other
Share Share be Treasury reserves Retained Non-controlling Total
Unaudited capital premium issued shares * earnings interest equity
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s GBP'000 GBP'000s
At 1 January
2015 677 23,474 63 (249) 6,704 15,016 - 45,685
--------- --------- --------- --------- ---------- ---------- ---------------- ---------
Profit for the
period - - - - - 555 - 555
Other comprehensive
income - - - - (2,504) - - (2,504)
Total comprehensive
income - - - - (2,504) 555 - (1,949)
--------- --------- --------- --------- ---------- ---------- ---------------- ---------
Transactions
with owners:
Share based
payment
transactions - - - - - 77 - 77
Tax relating
to share option
scheme - - - - - (3) - (3)
Shares issued 1 63 - - - - - 64
Dividends - - - - - (1,386) - (1,386)
---------- ---------
At 30 June 2015 678 23,537 63 (249) 4,200 14,259 - 42,488
--------- --------- --------- --------- ---------- ---------- ---------------- ---------
Shares
to Other
Share Share be Treasury reserves Retained Non-controlling Total
Unaudited capital premium issued shares * earnings interest equity
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s GBP'000 GBP'000s
At 1 January
2016 678 23,537 63 (249) 2,692 14,796 - 41,517
--------- --------- --------- --------- ---------- ---------- ---------------- ---------
Profit for
the period - - - - - (779) 71 (708)
Other comprehensive
income - - - - 4,864 - - 4,864
Total comprehensive
income - - - - 4,864 (779) 71 4,156
--------- --------- --------- --------- ---------- ---------- ---------------- ---------
Transactions
with owners:
Put option
relating to
non-controlling
interests - - - - (1,929) - - (1,929)
Non-controlling
interests - - - - - - 248 248
Purchase of
own shares - - - (2,079) - - - (2,079)
Share based
payment
transactions - - - - - 105 - 105
Tax relating
to share option
scheme - - - - - 1 - 1
Shares issued - - - - - - - -
Dividends - - - - - (1,327) - (1,327)
--------- --------- --------- --------- ---------- ---------- ---------------- ---------
At 30 June
2016 678 23,537 63 (2,328) 5,627 12,796 319 40,692
--------- --------- --------- --------- ---------- ---------- ---------------- ---------
* Other reserves includes a merger reserve of GBP2,369,000
(2015: GBP2,369,000), a translation reserve surplus of GBP5,187,000
(2015: GBP1,831,000) and a reserve relating to the put option held
by non-controlling interests of a debit balance of GBP1,929,000
(2015: nil). The merger reserve arose on acquisitions and
represents the difference between the fair value and the nominal
value of the shares issued. The translation reserve incorporates
the gains and losses on revaluation of the net assets and
liabilities of subsidiary undertakings and other currency gains and
losses that are presented in equity.
Notes to the interim financial information
For the six months ended 30 June 2016
1. Principal Accounting policies
This interim report was approved by the Board of directors on 2
August 2016. The financial information set out in this interim
report has been prepared under IFRS as adopted by the European
Union and on the basis of the accounting policies set out in the
statutory accounts of StatPro Group plc for the year ended 31
December 2015, amended as explained below.
New and amended accounting standards and interpretations
The following interpretations to existing standards have been
published that are mandatory for the Group's accounting and are
effective in the current period. The new standard does not impact
the interim report.
-- IFRS 14 Regulatory Deferral Accounts - 1 January 2016
Interpretations and revised standards that are not yet effective
and have not been early adopted by the Group
The following interpretations to existing standards have been
published that are mandatory for the Group's future accounting but
which the Group has not adopted early. We have not yet fully
assessed the impact of these new standards.
-- IFRS 9 Financial Instruments - Classification and Measurement - 1 January 2018
-- IFRS 15 Revenue from Contracts with Customers - 1 January 2018
-- IFRS 16 Leases - 1 January 2019
This report is not prepared in accordance with IAS 34, which is
not mandatory. This interim report has not been audited but has
been reviewed in accordance with ISRE 2410 by the Company's
auditors, Ernst & Young LLP. The financial information does not
constitute statutory accounts within the meaning of section 435 of
the Companies Act 2006. Statutory accounts for StatPro Group plc
for the year ended 31 December 2015 reported under IFRS have been
delivered to the Registrar of Companies. The auditors' report on
those accounts was unqualified, did not draw attention to any
matters by way of emphasis and did not contain a statement under
Section 498 (2) or (3) of the Companies Act 2006. Copies of this
report will be posted or provided electronically to shareholders.
Further copies are available free of charge on request from the
Company Secretary at the Company's registered office, Mansel Court,
Mansel Road, London SW19 4AA.
Basis of preparation - going concern
After making appropriate enquiries, the directors have a
reasonable expectation that the Group has adequate resources to
continue in operational existence for the foreseeable future. For
these reasons, the Board continues to adopt the going concern basis
in preparing the interim report.
2. Earnings per share
Basic (loss)/earnings per share has been calculated based on the
loss after taxation of GBP0.78 million (2015: profit of GBP0.56
million) and the weighted average number of shares of 65.84 million
(2015: 67.55 million). The diluted losses per share were 1.2p
(2015: earnings of 0.8p) based on potentially dilutive shares
outstanding of 1.06 million (2015: 0.39 million).
Weighted Weighted
average average
number Earnings number Earnings
of per of per
Earnings shares share Earnings shares share
Six Six Six Six Six Six
months months months months months months
to to to to to to
30 30 30 30 30 30
June June June June June June
2016 2016 2016 2015 2015 2015
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
GBP'000s '000s pence GBP'000s '000s pence
(Loss)/earnings
per share -
basic (779) 65,836 (1.2) 555 67,548 0.8
Potentially
dilutive shares - 1,059 (0.0) - 389 (0.0)
---------- ---------- ---------- ---------- ---------- ----------
(Loss)/earnings
per share -
diluted (779) 66,895 (1.2) 555 67,937 0.8
========== ========== ========== ========== ========== ==========
Adjusted earnings per share are shown in the table below.
Weighted Weighted
average average
number Earnings number Earnings
of per of per
Earnings shares share Earnings shares share
Six Six Six Six Six Six
months months months months months months
to to to to to to
30 30 30 30 30 30
June June June June June June
2016 2016 2016 2015 2015 2015
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
GBP'000s '000s pence GBP'000s '000s pence
(Loss)/earnings
per share - basic (779) 65,836 (1.2) 555 67,548 0.8
Add back: amortisation
of acquired intangibles 546 - 0.8 32 - 0.1
Effect of exceptional
items 1,241 - 1.9 - - -
Effect of tax on
exceptional items (391) - (0.6) - - -
Add back: share
based payments 105 - 0.2 77 - 0.1
---------- ---------- ---------- ---------- ---------- ----------
Adjusted earnings
per share 722 65,836 1.1 664 67,548 1.0
Potentially dilutive
shares - 1,059 (0.0) - 389 (0.0)
---------- ---------- ---------- ----------
Adjusted earnings
per share - diluted 722 66,895 1.1 664 67,937 1.0
========== ========== ========== ========== ========== ==========
3. Revenue analysis
The movement in Annualised Recurring Revenue in the period was
as follows:
Annualised Recurring Revenue 2016 2015
GBP million GBP
million
At 31 December 2015 28.70 29.39
Net impact of exchange rates 3.03 (1.30)
At 1 January 2016 (at 30
June 2016 rates) 31.73 28.09
ARR added with acquisitions 3.97 -
New contracted revenue 2.99 2.09
Cancellations/reductions (2.52) (1.56)
Net increase 0.47 0.53
At 30 June 2016 36.17 28.62
------------------------------- ------------ ---------
Revenue by product/service
Revenue by type of product or service was as follows:
Six Six Six Six Year
months months months months to
to to to to
30 June 30 June 30 30 31 December
June June
2016 2016 2016 2015 2015
Continuing Acquisitions Total
operations
GBP GBP GBP GBP GBP million
million million million million
Revenue
Software licences
- StatPro Seven 8.99 0.14 9.13 10.27 19.49
Software licences
- StatPro Revolution 4.02 1.43 5.45 2.45 5.72
------------ -------------- --------- --------- ------------
Software licences
- total 13.01 1.57 14.58 12.72 25.21
Data fees 1.81 - 1.81 1.68 3.34
------------ -------------- --------- --------- ------------
Total recurring
revenue 14.82 1.57 16.39 14.40 28.55
Professional services
and other revenue 1.00 0.16 1.16 1.04 1.64
------------ -------------- --------- --------- ------------
Total revenue 15.82 1.73 17.55 15.44 30.19
============ ============== ========= ========= ============
The Annualised Recurring Revenue profile of StatPro Revolution
clients (including Investor Analytics cloud solution sold via
Revolution) was as follows:
StatPro Annualised Number Average Annualised Number Average
Revolution revenue of revenue revenue* of revenue
clients per clients per
client client
*
Annualised June June June June June June
revenue 2016 2016 2016 2015 2015 2015
bands
GBP'000s Number GBP'000s GBP'000s Number GBP'000s
<GBP2k 69 61 1.1 127 101 1.3
GBP2k -
GBP10k 331 66 5.0 457 87 5.3
GBP10k-GBP50k 2,081 99 21.0 1,733 72 24.1
GBP50k-GBP100k 3,170 42 75.5 2,325 30 77.5
>GBP100k 8,068 47 171.7 2,572 12 214.3
----------- --------- --------- ----------- --------- ---------
Total 13,719 315 43.6 7,214 302 23.9
---------------- ----------- --------- --------- ----------- --------- ---------
* at constant currency
SaaS KPIs
Unaudited Unaudited Unaudited
Including Excluding
StatPro Revolution contracts IA IA
only
Year Year Year
to to to
30 30 30
June June June
2016 2016 2015
Average Cost of Acquiring
Customer ("CAC") (GBP'000s) 39.5 40.3 37.9
Implied Customer Lifetime
(years) 9.0 28.6 16.7
Average ARR per customer
(GBP'000s) 43.6 38.7 21.4
Implied Customer Lifetime
Value ("LTV") (GBP'000s) 393 1,107 358
LTV: CAC 9.9 27.5 9.5
The SaaS KPIs above are for the cloud products and we include
the results with and without IA for June 2016. Revolution is a more
recently developed product and therefore has lower churn and hence
a higher implied lifetime and hence a much higher LTV and LTV:CAC
ratio.
4. Exceptional items
Exceptional items amounting to a total of GBP1.24 million were
incurred. GBP1.06 million related to the acquisition of Investor
Analytics, of which GBP0.47 million related to transaction costs
and the remainder related to reorganisation costs, redundancies and
onerous leases. There was also an exceptional charge amounting to
GBP0.44 million relating to a reorganisation of our Paris office
including redundancy costs and onerous leases. There was also an
exceptional credit of GBP0.26 million arising related to the
negative goodwill on the InfoVest acquisition. The tax credit on
the exceptional items was GBP0.39 million.
5. Adjusted profit before taxation, adjusted operating profit,
adjusted EBITDA and gross margin analysis
a) Adjusted profit before taxation
Unaudited Unaudited Audited
Six Six Year
months months to
to 30 to 30 31 December
June June
2016 2015 2015
GBP'000s GBP'000s GBP'000s
(Loss)/profit before taxation (960) 821 2,409
Add back: Amortisation on acquired
intangible assets 546 32 32
Add back: Exceptional items 1,241 - -
Add back: Share based payments 105 77 121
---------- ---------- -------------
Adjusted profit before tax 932 930 2,562
========== ========== =============
b) Adjusted operating profit
` Unaudited Unaudited Audited
Six Six Year
months months to 31
to 30 to 30 December
June June
2016 2015 2015
GBP'000s GBP'000s GBP'000s
Operating (loss)/profit (603) 983 2,699
Add back: Amortisation on acquired
intangible assets 546 32 32
Add back: Exceptional items 1,241 - -
Add back: Share based payments 105 77 121
---------- ---------- ----------
Adjusted operating profit 1,289 1,092 2,852
========== ========== ==========
c) Adjusted EBITDA
Unaudited Unaudited Audited
Six Six Year
months months to 31
to 30 to 30 December
June June
2016 2015 2015
GBP'000s GBP'000s GBP'000s
Operating (loss)/profit (603) 983 2,699
Add back: Depreciation of property,
plant and equipment 659 517 996
Add back: Amortisation on purchased
intangible assets 105 117 196
Add back: Amortisation on acquired
intangible assets 546 32 32
Add back: Exceptional items 1,241 - -
Add back: Share based payments 105 77 121
---------- ---------- ----------
Adjusted EBITDA 2,053 1,726 4,044
========== ========== ==========
Adjusted EBITDA margin 11.7% 11.2% 13.4%
d) Gross profit margin analysis
Gross profit margin analysis helps us assess the profitably of
incremental revenue as the business evolves into a pure cloud
business and the costs drivers begin to change. As there are a
number of methodologies for allocating costs, we have described how
we have allocated the cost elements. The Board's view is that, as
the business grows, the inherent scalability of cloud technology
will lead to greater profitability in the future.
Unaudited Unaudited Unaudited
Six months Six months Year
to 30 to 30 to 31
June June December
2016 2015 2015
% % %
Revenue 100.0% 100.0% 100.0%
Cost of services (40.0%) (38.9%) (38.6%)
----------- ----------- ----------
Gross profit margin 60.0% 61.1% 61.4%
R&D costs (6.3%) (5.1%) (4.2%)
Sales & Marketing
costs (8.9%) (11.9%) (11.3%)
General & Administration
costs (33.6%) (33.4%) (32.9%)
----------- ----------- ----------
(48.8%) (50.4%) (48.4%)
Share based payments 0.5% 0.5% 0.4%
----------- ----------- ----------
Adjusted EBITDA 11.7% 11.2% 13.4%
=========== =========== ==========
Definition of cost category for gross margin analysis:
Cost of services includes Clients Services employee salaries,
Data employee salaries, Development employee salaries related to
support, contractors costs, data costs, costs of software and
hardware maintenance.
R&D includes the element of Development employee salaries
that relates to new research and development.
Sales & marketing includes Sales and Marketing employee
salaries, external marketing costs and sales commissions.
General & administration includes the Finance, HR and IT
employee salaries, communications costs, occupancy costs,
professional fees, travel and expenses, and other costs.
Free cash flow
Unaudited Unaudited Audited
Six Six Year
months months to
to 30 to 31
June 30 December
June
2016 2015 2015
GBP'000s GBP'000s GBP'000s
Cash generated from operations
before exceptional payments 3,166 3,690 6,548
Net interest paid (216) (20) (84)
Net tax paid (1,421) (669) (832)
Purchase of property, plant
and equipment (1,016) (513) (881)
Investment in intangible assets (2,080) (1,708) (4,127)
---------- ---------- ----------
Free cash flow (1,567) 780 624
---------- ---------- ----------
Cash flow on exceptional items (875) - -
---------- ---------- ----------
Free cash flow (2,442) 780 624
========== ========== ==========
The free cash flow was negative in H1 2016 due to a higher level
of investment in property, plant and equipment and intangibles and
a higher than normal level of tax paid.
6. Reconciliation of profit before tax to net cash inflow from operating activities
Unaudited Unaudited Audited
Six Six
months months Year
to to to
30 30 31
June June December
2016 2015 2015
GBP'000s GBP'000s GBP'000s
(Loss)/profit before taxation (960) 821 2,409
Net finance expense 357 162 290
---------- ---------- ----------
Operating (loss)/profit (603) 983 2,699
Exceptional items 1,241 - -
---------- ---------- ----------
Operating profit before exceptional
items 638 983 2,699
Depreciation of property, plant
and equipment 659 517 996
Loss on disposal of property,
plant and equipment - - 11
Amortisation of intangible assets 2,363 1,720 3,766
Decrease/(increase) in receivables 826 1,058 (782)
(Decrease)/increase in payables
and provisions (1,560) (961) (1,402)
Increase in deferred income 135 296 1,139
Share based payments 105 77 121
---------- ---------- ----------
Net cash inflow from operating
activities before exceptional
payments 3,166 3,690 6,548
---------- ---------- ----------
Cash flow on exceptional items (875) - -
---------- ---------- ----------
Net cash inflow from operating
activities 2,291 3,690 6,548
========== ========== ==========
7. Reconciliation of net cash flow to movement in net (debt)/cash
Unaudited Unaudited Audited
Six months Six Year
to 30 months to
June to 30 31 December
June
2016 2015 2015
GBP'000s GBP'000s GBP'000s
Increase/(decrease) in
cash and cash equivalents
in the period 1,183 (389) (355)
Movement on bank loans (10,797) - (639)
Movement on finance leases (1,040) (153) (269)
Exchange movements 229 (111) (133)
----------- ---------- -------------
Movement in net (debt)/cash (10,425) (653) (1,396)
Net cash at beginning
of period 1,284 2,680 2,680
Net (debt)/cash at end
of period (9,141) 2,027 1,284
=========== ========== =============
8. Dividend
An interim dividend for 2016 of 0.85 pence per Ordinary Share
(2015: 0.85 pence) will be paid on 2 November 2016 to shareholders
on the register on 7 October 2016. A final dividend for 2015 of
2.05 pence per ordinary share was paid on 25 May 2016.
9. Acquisitions
Acquisition of Investor Analytics
On 21 January 2016, StatPro Inc. (a wholly owned subsidiary of
the Company) acquired the entire share capital of Investor
Analytics LLC, the US-headquartered, cloud-based risk analytics'
company to hedge funds and asset managers for a cash consideration
of $10 million. There is an additional contingent payment of up to
$6 million.
Highlights of the acquisition are:
-- Complementary Risk Factor and Monte Carlo models to add to StatPro's Historical Simulation
risk model
-- Significantly increases StatPro's US presence, enhancing geographical reach
-- Annualised Recurring Revenue ("ARR") of $4.85 million (GBP3.3 million)
-- Increases StatPro's cloud-based ARR to 34% of total Group ARR from 27%
-- Expected to be earnings enhancing in 2016 on a pro-forma basis following completion of the
integration programme
-- 53 client contracts - all new client relationships for StatPro
-- Cash consideration:
o $7 million on closing
o Two deferred payments - $2 million after one year and $1 million after two years
o Additional contingent payment - up to $6 million after one year, dependent on securing a
number of new contract wins
Based on unaudited results for the year ended 31 December 2015,
IA reported revenue of approximately $5.0 million (of which
approximately 94% was recurring) and an EBITDA loss of
approximately $0.3 million. Cost synergies have been achieved for
data feeds, administrative services, property and other costs. The
exceptional charge associated with achieving these, including
transaction costs for the acquisition, was GBP1.06 million.
The tables below provides the allocation of the purchase price
to the fair value of intangible and tangible assets acquired as
required under IFRS 3 and whilst these have been reviewed by the
auditors, they are subject to audit at the year end. The
provisional fair values of the assets and liabilities are presented
below.
Fair value of assets acquired and
liabilities assumed
Provisional
fair
value
GBP'000
Property, plant and equipment 5
Trade debtors 274
Other receivables 282
Cash and cash equivalents 129
Brand and client contract 2,848
Technology 1,292
------------
4,830
Deferred income (625)
Other creditors and provisions (440)
Deferred tax liability (1,614)
------------
(2,679)
------------
Total identifiable net assets at
fair value 2,151
Goodwill arising on acquisition 5,010
------------
Fair value of purchase consideration 7,161
============
Acquisition of InfoVest
With effect from 1 March 2016, StatPro South Africa (Pty) Ltd.
(a wholly owned subsidiary of the Company) acquired 51% of the
share capital of InfoVest Consulting (Pty) Ltd, a South African
headquartered software provider, specialising in data warehouse,
ETL and reporting software for the asset management industry. The
purchase has been made via the transfer of StatPro Portfolio
Control ("SPC") licence agreements to InfoVest, which StatPro
provides to South African clients and which InfoVest currently
supports on behalf of StatPro.
Highlights of the acquisition are:
-- Acquisition of 51% of InfoVest
-- Purchase settled by the transfer of SPC licence contracts to InfoVest
-- Joint marketing agreement signed to promote each other's products and services
-- Justin Wheatley, StatPro CEO and Craig Arenhold, CEO StatPro
South Africa will join InfoVest
Board, although the business will be managed independently
-- Deal is expected to be earnings enhancing in 2016
Given increased regulations there is a growing demand for
compliance management solutions such as SPC, which is a module of
one of StatPro's products, StatPro Seven. By taking a majority
stake in InfoVest, StatPro will benefit from this expanding market
as well as improving the product and services it offers.
InfoVest's data warehouse software is a cost effective solution
for asset managers and service providers to manage their internal
data effectively in order to provide both input data to other
systems and for reporting. The success of implementing a solution
such as StatPro Revolution Performance depends on a client's
ability to provide data in a reliable manner. InfoVest's software
is designed to do precisely this.
In addition, StatPro and InfoVest have entered into a joint
marketing agreement to promote each other's products and services
as part of StatPro. InfoVest products will keep their current
branding, whilst benefitting from the marketing reach of
StatPro.
Based on unaudited results for the year ended 28 February 2016,
InfoVest reported revenue of ZAR 20.7 million (approximately GBP1.0
million), including approximately GBP0.19 million revenue for
supporting SPC. The provisional fair values of the assets and
liabilities are presented below.
Fair value of assets acquired
and liabilities assumed
Provisional
fair
value
GBP'000
Property, plant and equipment 34
Trade debtors 329
Other receivables 34
Cash and cash equivalents 67
Brand and client contract 257
Technology 433
------------
1,154
Deferred income (403)
Other creditors and provisions (52)
Deferred tax liability (193)
------------
(648)
------------
Total identifiable net
assets at fair value 506
Non-controlling interest
measured at fair value (248)
Goodwill arising on acquisition (258)
------------
Fair value of purchase -
consideration
============
The negative goodwill arises as there was no deemed
consideration following the transfer of SPC contracts and the
goodwill is credited to the profit and loss as an exceptional item
(see note 4).
There is also a liability included in the Group balance sheet
amounting to GBP1.93 million relating to InfoVest due to the
requirement to include a fair value, as defined by IFRS 13, for the
theoretical potential amount that StatPro would pay to buy out the
non-controlling shareholders under certain circumstances.
10. Goodwill and other intangible assets
The increase in goodwill since 31 December 2015 of GBP11.20
million relates to increases due to the acquisition of IA amounting
to GBP5.01 million and exchange gains of GBP6.19 million on
revaluation of goodwill denominated in foreign currencies. Other
intangible assets comprise internally generated development costs
capitalised, acquired intangible assets (client contracts,
technology and brands) and purchased intangible assets.
11. Provisions
Provisions of GBP5.46 million at 30 June 2016 (2015: GBP0.71
million) relates to deferred contingent consideration for a number
of acquisitions and provisions for redundancies and onerous
contracts. It includes an amount for the acquisition of the
non-controlling interest in SiSoft Sarl as well as amounts relating
to the non-controlling interests' put option in InfoVest and
deferred consideration for Investor Analytics.
Provisions - 2016 2016 2016 2016 2015
Group
Contingent Non-controlling Redundancies Total Total
consideration interests' and
put onerous
option contracts
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
At 1 January 642 - - 642 738
Utilised in
the period - - (556) (556) (7)
Arising in the
period 2,206 1,929 1,029 5,164 -
Exchange differences 207 - - 207 (26)
At 30 June 3,055 1,929 473 5,457 705
=============== ================ ============= ========= =========
12. Share capital and treasury shares
No shares were issued during the period (2015: 106,000).
2,873,713 shares were purchased into treasury in March 2016. At 30
June 2016, there were 67,813,650 shares (2015: 67,813,650 shares)
in issue including 3,098,713 (2015: 225,000) held in treasury
(64,714,937 excluding treasury shares). The treasury shares do not
accrue dividends and are excluded from the earnings per share
calculation.
Independent review report to StatPro Group plc
Introduction
We have been engaged by the Company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 30 June 2016, which comprises the Group Income
Statement, Group Statement of Comprehensive Income, Group Balance
Sheet, Group Statement of Cash Flows, Group Statement of Changes in
Shareholders' Equity and the related notes 1 to 12. We have read
the other information contained in the half yearly financial report
and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
This report is made solely to the Company in accordance with
guidance contained in International Standard on Review Engagements
2410 (UK and Ireland) "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the
Auditing Practices Board. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other than the
company, for our work, for this report, or for the conclusions we
have formed.
Directors' Responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the Interim Report in accordance with the AIM Rules
issued by the London Stock Exchange which require that it is
presented and prepared in a form consistent with that which will be
adopted in the Company's annual accounts having regard to the
accounting standards applicable to such annual accounts.
As disclosed in note 1, the annual financial statements of the
Group are prepared in accordance with IFRS's as adopted by the
European Union. The condensed set of financial statements included
in this half-yearly financial report has been prepared in
accordance with the AIM Rules issued by the London Stock
Exchange.
Our Responsibility
Our responsibility is to express to the Company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review.
Scope of Review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, "Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity" issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
June 2016 is not prepared, in all material respects, in accordance
with the accounting policies outlined in Note 1, which comply with
IFRS's as adopted by the European Union and in accordance with the
AIM Rules issued by the London Stock Exchange.
Ernst & Young LLP
London
2 August 2016
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR AKBDNCBKDAFK
(END) Dow Jones Newswires
August 03, 2016 02:01 ET (06:01 GMT)
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