TIDMDGB
RNS Number : 3676Q
Digital Barriers plc
29 November 2016
29 November 2016
Digital Barriers plc
("Digital Barriers" or the "Group")
Interim Results for the six months ended 30 September 2016
Digital Barriers (AIM: DGB) the specialist provider of visually
intelligent technologies to the global surveillance, security and
safety markets, announces its unaudited results for the six months
ended 30 September 2016.
Key Highlights
-- Total Group revenue recognised in the period up 95% to
GBP13.0m (H116: GBP6.7m), including a full contribution from
Brimtek (acquired on 1 March, 2016)
-- Organic revenues, excluding Brimtek, recognised in the period
were broadly flat at GBP6.9m (H116: GBP6.7m), although
international organic revenues grew 18% to GBP6.1m (H116: GBP5.1m),
and would have been close to double had contracts secured in
September delivered before the period-end
-- Organic sales (i.e. new order intake) in the period grew
strongly, up 67% to GBP13.2m (H116: GBP7.9m), of which GBP9.3m was
secured in September alone, contributing to the Group having booked
approximately 50% of the Board's revenue expectation for the
financial year as a whole by the period-end
-- GBP5.2m of organic contracted orders carried over for
delivery in the second half, up 64% on the contracted order book
for second half delivery at the same point last year (H116:
GBP3.2m)
-- Adjusted losses before tax from continuing operations for the
period were flat at GBP4.2m (H116: GBP4.2m), with the unadjusted
loss from continuing operations down 8% to GBP4.8m (H116:
GBP5.2m)
-- Brimtek now fully integrated, with good progress made in
evolving its focus from third-party products to the Group's
proprietary technologies; as a result, organic revenue growth in
the United States was especially strong in the period, with
revenues from the Group's own solutions up more than fivefold to
$5.6m (H116: $1.0m)
-- Sales highlights in the period included more than $8m of
EdgeVis video surveillance solutions to a number of US flagship
agencies, a $1.65m investment in ThruVis by the US Transportation
Security Administration (TSA), a GBP2m follow-on contract from BT
Redcare, and a GBP1m contract with an existing transportation
customer in Asia-Pacific
-- Net cash at the end of the period was GBP3.4m (H116:
GBP5.9m), and since the period-end the Group has established a
GBP10m revolving credit facility to help provide working capital to
underpin further growth
Commenting on the results, Tom Black, Chairman of Digital
Barriers, said:
"The highlight of the period was undoubtedly organic sales
growth, up 67% across the Group, with the organic contracted order
book carrying into the second half up 64% on the year before. Our
US business was especially strong, with material sales and revenue
growth for our own solutions into multiple flagship government
agencies. This illustrates why it was so important to acquire a
platform in the US on which to build. The period saw strong US
momentum in EdgeVis surveillance sales, and an initial TSA
investment into ThruVis for mass-transit security, which is
especially significant given that it is the world's pre-eminent
transportation security authority, often setting international
standards.
It is clear that we have now established a strong organic growth
engine, selling our highly-differentiated solutions into a wide
range of flagship customers around the world. Growth itself is not
our primary challenge, but rather the timing of contract awards in
relation to financial period-ends. We have developed a business
that can grow materially over the coming years, but managing the
orderly timing of that growth will be a continuing challenge.
The global security context continues to worsen, with a focus on
mass-migration, international terrorism and escalating regional
tensions, all of which drive increased spend on border and homeland
security, specialist areas of defence and cross-border identity
assurance. We have compelling, proven and uniquely capable
solutions across all of these areas, and we have customers and
partners in each of the major markets around the world. Our focus
remains on continued sales momentum leading to material revenue
scale, break-even, and then consistent year-on-year
profitability."
For further information please contact:
Digital Barriers plc +44 (0)20 3553 5888
Zak Doffman, Chief Executive Officer
Sharon Cooper, Chief Financial Officer
Investec Investment Banking (NOMAD
& Broker) +44 (0)20 7597 5970
Andrew Pinder / Dominic Emery / Patrick
Robb
FTI Consulting LLP +44 (0)20 3727 1000
Edward Bridges / Matt Dixon
About Digital Barriers:
Digital Barriers provides visually intelligent solutions to the
global surveillance, security and safety markets. We deliver
zero-latency streaming and analysis of secure video and related
intelligence over wireless networks, including cellular, satellite,
IP mesh and cloud, utilising significantly less bandwidth than
standard technologies.
Our rapidly-installed fixed and mobile solutions for covert,
remote and wide-area deployments, as well as vehicle and body-worn
applications, have been sold into more than fifty countries, and
have been proven in some of the world's most demanding operational
environments. We also provide advanced video content analysis and
body scanning to identify safety concerns and threats in
real-time.
www.digitalbarriers.com
Chairman's Statement
A context for significant growth
The news of the last few months has been dominated by Brexit and
the US Presidential election, where, in both cases, hard fought
campaigns led to results that many found surprising. One of the few
constants throughout both campaigns, and following both results,
has been a focus on the global security context, encompassing the
continued threat from international terrorism as well as
instability in the Middle East, Eastern Europe, the South China Sea
and Northeast Asia.
Since its inception, Digital Barriers has acquired, integrated
and developed a number of highly-differentiated technologies that
are now being sold to security, law enforcement and defence
agencies around the world responsible for keeping us safe. Although
we have since widened our focus to include major commercial
organisations with a requirement for class-leading live video
streaming and analytics applications, the vast majority of our
revenues still come from flagship government agencies. We believe
the combination of the sustained and volatile global security
context, and the range of advanced solutions we now offer, can
support material growth for Digital Barriers for many years to
come.
The Group delivered strong organic sales growth (i.e. new order
intake) this period, up 67% to GBP13.2m (H116: GBP7.9m), of which
GBP5.2m has been carried over for delivery in the second half.
Revenue recognised in the period grew 95% on last year to GBP13.0m
(H116: GBP6.7m), including a full contribution from Brimtek.
Organic revenues, excluding Brimtek, recognised in the period were
broadly flat at GBP6.9m (H116: GBP6.7m), although international
organic revenues grew 18% to GBP6.1m (H116: GBP5.1m), and would
have been close to double had contracts secured in September
delivered before the period-end. Adjusted losses before tax from
continuing operations for the period were flat at GBP4.2m (H116:
GBP4.2m), with the loss from continuing operations down 8% to
GBP4.8m (H116: GBP5.2m). Net cash at the end of the period was
GBP3.4m (H116: GBP5.9m), and since then we have secured a GBP10m
revolving credit facility to help provide the working capital to
support growth, easing some of the challenges around period-end
deliveries.
The ongoing challenge of timing
The timing of contract awards remains our challenge, rather than
growth itself. The nature of the customers and regions we sell into
often gives us limited levers to control timing. Frequently we are
subject to delays which result from lengthy government procurement
policies and processes. This challenge has not gone away, and as we
continue to grow we will likely be presented with ever larger and
more strategic procurements to navigate. The GBP9.7m of contracts
secured in September alone, of which only GBP3.8m delivered by the
period-end, is a clear illustration of this. Increasing scale and
reach, as well as improved familiarity with markets and customers
over time, will mean that we will be better placed to manage this
challenge in the future. We are also looking at developing
additional run rate and recurring revenue lines, including
offerings within our SmartVis and CloudVis portfolios, to better
facilitate forecasting business performance. But for now, the
timing of contract awards remains the key risk in meeting forecasts
from one period to the next.
Despite this challenge, the growth opportunity for the Group has
never been better, strengthening materially in the last couple of
years, and our overall sales pipeline now stands at more than
GBP250m, up 135% on this time last year, of which more than GBP150m
is addressable within the next 18 months. The scale of this market
opportunity is driven by a worldwide focus on secure borders,
prevention of terrorism, counter-insurgency and control of
mass-migration. These imperatives are behind the ongoing adoption
of our solutions by flagship US agencies, major border and homeland
security programmes we are pursuing in Asia, and the strategic
positioning we are targeting in EMEA.
Our confidence also comes from the fact that our solutions are
built around our own world-class technology, which continues to
enjoy very significant differentiation over its competition. We
stream live video from fixed locations, vehicles, even body-worn
cameras, more efficiently than any other technology in the world.
We offer a 'digital wall' border or perimeter security solution
that is more effective than a physical barrier at a fraction of the
price. We have the only passive camera in the world proven to
detect explosives and weapons concealed under clothing without
disrupting passenger throughput at transit hubs or slowing entry
into other 'soft targets'. In addition, our new facial recognition
solution, which works across multiple devices, including
smartphones, to provide cloud-based identity assurance and threat
mitigation, secured a competitive counter-terrorism contract with a
major European MOD within weeks of launch.
Building meaningful global sales momentum
Since inception, we have maintained that international sales and
revenue will drive our development, accessing a vast and growing
market. More than 90% (H116: 77%) of our revenues already come from
customers outside the UK, and we believe the international
opportunity for us is getting ever-larger, given the global
security context set out above.
We secured more than GBP10m of contract awards with major US
federal agencies during the period, and it is the performance of
our US business, following on from the acquisition of Brimtek
completed on 1 March 2016, which is the stand-out success.
Brimtek's legacy business 'passed through' or 'product-integrated'
a range of third-party technologies. As a consequence, its gross
margin was significantly lower than our own. Nevertheless,
Brimtek's customer-base viewed it as a trusted, established and
important player within the defence and security supply chain. At
the time of the acquisition, we made it clear that the rationale
for bringing Brimtek into the Group was to increase significantly
the potential for the sale of Digital Barriers' solutions into US
defence and law enforcement customers, by leveraging the scale,
heritage and credibility of Brimtek as a sales and supply chain
platform. Brimtek enables us to pursue meaningful sales of
high-margin, highly-differentiated products to the most
aspirational customer base in our sector anywhere in the world, and
it is very encouraging to see the very earliest of these pursuits
paying off. The fivefold growth in organic revenues delivered in
the US in the period could not have been achieved without Brimtek,
and the position we are now building across federal law enforcement
and defence agencies will be a major driver of growth over the
coming years, with a continuing transition from legacy Brimtek
sales to our own solutions to improve margins.
All that said, and as a further example of the timing of
contract awards being much more of a challenge for us than growth
itself, the change of administration and leadership across key US
agencies and departments following the election brings a very short
term risk of inertia, which may have an impact on some of our
planned US revenues in the second half of the year. Nevertheless,
we are under no doubt that our direction of travel in the US is
toward very material growth. We expect the election result to
provide significant opportunities for Digital Barriers through the
lifetime of the Administration, given its stated focus on homeland
security, border security and defence. We expect to see very strong
growth from new and existing US customers from the next financial
year onwards.
Outside the US, during the period we secured a GBP2m follow-on
contract from BT Redcare in the UK and a GBP1m follow-on contract
with a transportation customer in Asia-Pacific. Since the
period-end, we have also secured a EUR0.4 million follow-on
contract from a major European transportation customer, announced a
technology collaboration with G4S for public event security and
have become preferred supplier for a significant European counter
terrorism solution.
Asia-Pacific, having delivered very strong revenue growth for us
over the last three years, produced fewer sales in this period as
we expended the majority of our efforts on our positioning for
several forthcoming major procurements to underpin growth in the
region for several years to come. This is going well and we expect
some of this investment to translate into preferred supplier status
and contract awards before the end of this financial year. Our EMEA
region has been established to bring together our UK, Europe and
Middle East teams. This is now working effectively and we expect to
see revenue growth this financial year, as we devote increased
management attention to this region.
Technology solutions aligned to key market themes
We will deliver continued momentum and growth because the
proprietary, patented technologies we have acquired and developed
play into a number of major themes that are central to security and
defence strategies around the world:
-- Seminal improvements in public, first responder and military
safety and operational effectiveness, come from streaming live
video from every vehicle, soldier, police officer, and public
safety worker: EdgeVis Live delivers real-time video over wireless
networks more effectively and efficiently than any other technology
anywhere in the world. Over the coming years, all law enforcement
vehicles will have the ability to deliver live video from the
field. And the current rollout of body worn cameras, dominated by
outdated record-only solutions, will inevitably give way to live
streaming solutions. Our technology requires up to 60% less
bandwidth than competing technologies, which means it works in the
real world and it delivers very material cost savings as well.
-- Border and critical infrastructure security has risen to the
top of the security agenda for governments around the world. Our
EdgeVis Shield integrated surveillance platform was initially
developed to provide a front line force protection capability for
the UK Ministry of Defence during its engagement in Afghanistan. It
erects a 'digital wall' along unlimited lengths of borders or
perimeters. It is exceptionally cost-effective, at less than 5% of
the cost of a physical border or perimeter wall. It can be rapidly
and flexibly deployed. And it can detect and track any incursion,
any breach, anywhere. This now includes monitoring for tunnels
underneath 'fence lines' as well as drones overhead. The technology
has been successfully deployed in every conceivable jungle, desert,
remote, hostile and urban environment. The same technology is being
used to protect transportation hubs, oil and gas networks, and
military bases, whether on home soil or in hostile overseas
locations.
-- Crowded public spaces, whether airports, mass-transportation
hubs or entertainment venues, are increasingly viewed as 'soft
targets' vulnerable to terrorist attack. Our ThruVis technology is
uniquely capable of detecting threats to life, such as weapons and
explosives, concealed under clothing as would-be attackers enter
these locations. Furthermore, it does this entirely passively using
nothing more than a proprietary highly-sensitive camera, and it
does this at standoff distances without slowing down passenger
throughput. It is the unique nature of this capability, developed
over more than ten years and with tens of millions of pounds of
public and private investment, that prompted the US Transportation
Security Administration (TSA) to invest in its deployment for
mass-transit security and for G4S to recognise its potential to
protect public events.
-- There are too many CCTV video surveillance cameras in
operation to be viewed effectively. The danger is they become a
forensic tool, establishing "what happened when" but not alerting
to "what's happening now". Our SmartVis and CloudVis software
platforms provide government-accredited video intelligence that can
be embedded on cameras or accessed in the cloud to provide
real-time alerts. We are integrating SmartVis with EdgeVis Live and
EdgeVis Shield to provide even more differentiation across our
solutions. We have also secured a number of OEM contracts with
major industry players for this software on a licensed basis.
-- The newest addition to our technology portfolio is SmartVis Face, which delivers the same industry-leading differentiation as our other solutions. Still in the early stages of its release, this facial recognition technology has already secured a major contract with a European Ministry of Defence for counter-terrorism applications and is under test deployment with special operations and law enforcement agencies in a number of countries. Operating on fixed or wireless cameras, and even on smartphones and body-worn devices, the technology can compare passing faces to watch lists, delivering real-time alerts on seeing any persons of interest. It can also be used for 1:1 biometric identity assurance, within standoff and non-consensual applications. As with our wider SmartVis platform, we are already engaged in a number of discussions to license this software.
Financials
Revenue and Gross Margin
Group revenue in the period, including a full period
contribution from Brimtek, increased 95% to GBP13.0m in the
six-months ended 30 September 2016 compared to GBP6.7m in the same
period last year. This increase is primarily a result of the
expansion of revenue from North America, aided by the acquisition
of Brimtek Inc. in March 2016 with revenues from North America
increasing from GBP0.6m in H116 to GBP10.2m in H117.
The Group generated a gross profit of GBP4.3m (H116: GBP3.5m),
which equates to a gross margin of 33%, a decrease on the Group's
gross margin of 53% in H116. This gross margin decrease is largely
due to mix effect, with the addition of Brimtek revenues in the
period. Brimtek legacy revenues attract a lower gross margin
compared to sales which include the Group's technology. The gross
margin attached to revenues which do include our technology has
reduced marginally from 53% in H116 to 50% in H117 reflecting
significant sales success in the US market for a newly launched
family of Digital Barriers products, whose margin will improve in
the future as engineering innovations are implemented.
Adjusted Loss
The adjusted loss before tax was GBP4.2m (H116: GBP4.2m) from
continuing operations, with significant revenue growth offset by
increased administration costs, primarily driven by a full period
of the acquired Brimtek cost base. On an unadjusted basis the loss
from continuing operations for the period was GBP4.8m (H116:
GBP5.2m).
Discontinued Operations
On 1 April the Board signed an agreement for the disposal of the
Services segment to its existing management team for GBP1. The
disposal group was classified as held for sale in March 2016, with
the sale completed on 19 May 2016. The loss from discontinued
operations of GBP0.2m (H116: GBP0.5m) reflects the trading loss of
the division up until the date of completion.
Cash
The Group ended the period with a GBP3.4m net cash balance
(H116: GBP5.9m, FY16: GBP10.8m). Net cash outflow from operating
activities was GBP7.2m (H116: GBP2.7m). Capital expenditure in the
period of GBP0.4m (H116: GBP0.1m) accounts for the balance of the
cash spend. On 17(th) October the Group replaced an existing GBP5.0
million secured working capital facility for export activities with
a new two-year GBP10.0 million secured revolving credit facility
with Investec Bank plc. The funds available through this facility
will be used to meet the increasing working capital requirements of
the Group's organic growth.
Outlook
It is because we sell to flagship customers around the world
that we are so well positioned for material growth over the coming
years. But, as set out above, the nature and scale of those same
customers makes the timing of the contract awards that underpin our
growth difficult to control. This is the balancing act that will
continue to define us until we reach the scale of revenue where we
can exert significantly more control over the timing of contract
awards. Until then, meeting short-term targets will remain an
ongoing challenge that will need to be managed.
The Board remains extremely positive about the future of the
business and is anticipating material growth in the second-half of
the financial year. The growth trajectory of the Group will deliver
continued momentum towards break-even and beyond, making consistent
year-on-year profitability highly achievable in a global market
that is large and growing larger.
Independent review report to Digital Barriers 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
6 months ended 30 September 2016 which comprises the consolidated
income statement, the consolidated statement of comprehensive
income, the consolidated balance sheet, the consolidated statement
of changes in equity, the consolidated statement of cash flows, and
related notes 1 to 11. 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 half-yearly financial report in accordance with
International Accounting Standard 34, "Interim Financial
Reporting," as adopted by the European Union and the AIM Rules
issued by the London Stock Exchange.
As disclosed in note 1, the annual financial statements of the
Group are prepared in accordance with IFRSs 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 International Accounting Standard 34, "Interim
Financial Reporting," as adopted by the European Union.
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 6 months ended 30
September 2016 is not prepared, in all material respects, in
accordance with International Accounting Standard 34 as adopted by
the European Union and in accordance with the AIM Rules issued by
the London Stock Exchange.
Ernst & Young LLP
London
29 November 2016
DIGITAL BARRIERS PLC
Consolidated income statement
for the six months ended 30 September 2016
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2016 2015 2016
Unaudited Unaudited Audited
Note GBP'000 GBP'000 GBP'000
------------------------------ ----- ------------- ------------- -----------
Continuing operations
Revenue 2 13,037 6,688 21,136
Cost of sales (8,688) (3,165) (10,619)
------------------------------ ----- ------------- ------------- -----------
Gross profit 4,349 3,524 10,517
Administration costs (10,793) (8,832) (17,500)
Other income / (costs) 509 - (1,718)
------------------------------ ----- ------------- ------------- -----------
Operating loss (5,935) (5,320) (8,701)
Finance revenue 1,310 14 227
Finance costs (323) (2) (32)
------------------------------ ----- ------------- ------------- -----------
Loss before tax (4,948) (5,308) (8,506)
Income tax 182 145 716
------------------------------ ----- ------------- ------------- -----------
Loss for the period /
year from continuing
operations (4,766) (5,163) (7,790)
------------------------------ ----- ------------- ------------- -----------
Discontinued operations
Loss from discontinued
operation (net of tax) (192) (501) (4,832)
Loss for the period /
year (4,958) (5,664) (12,622)
Adjusted loss: 3
Loss before tax from
continuing operations (4,948) (5,308) (8,506)
Amortisation of intangibles
initially recognised
on acquisition 864 633 1,320
Share-based payment 3 430 437 792
Acquisition related costs
and exceptional write
off of bad debt (509) - 1,718
Adjusted loss before
tax for the period /
year from continuing
operations (4,163) (4,238) (4,676)
------------------------------ ----- ------------- ------------- -----------
(Loss) per share - continuing
operations
(Loss) per share - basic 4 (2.88p) (6.11p) (7.42p)
(Loss) per share - diluted 4 (2.88p) (6.11p) (7.42p)
(Loss) per share - adjusted* 4 (2.42p) (4.88p) (3.82p)
(Loss) per share - adjusted
diluted* 4 (2.42p) (4.88p) (3.82p)
(Loss) per share - continuing and discontinued
operations
Loss per share - basic (3.00p) (6.70p) (12.02)
Loss per share - diluted (3.00p) (6.70p) (12.02)
------------------------------ ----- ------------- ------------- -----------
* As explained in note 3, the basis of calculation was adjusted
in 31 March 2016 to include share-based payment charges.
Comparative figures for the period to 30 September 2015 has been
updated to incorporate this change.
DIGITAL BARRIERS PLC
Consolidated statement of comprehensive income
for the six months ended 30 September 2016
6 months 6 months
ended ended Year ended
30 September 30 September
2016 2015 31 March 2016
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------ ------------- ------------- --------------
Loss for the period /
year from continuing
operations (4,766) (5,163) (7,790)
Loss for the period /
year from discontinued
operations (192) (501) (4,832)
Loss for the period /
year attributable to
owners of the parent (4,958) (5,664) (12,622)
Other comprehensive income
from continuing operations
------------------------------ ------------- ------------- --------------
Other comprehensive income
that may be subsequently
reclassified to profit
and loss:
Exchange differences
on retranslation of foreign
operations 464 28 123
------------------------------- ------------- ------------- --------------
Net other comprehensive
income to be reclassified
to profit or
loss in subsequent periods 464 28 123
------------------------------- ------------- ------------- --------------
Total comprehensive loss
attributable to owners
of the parent (4,494) (5,636) (12,499)
------------------------------- ------------- ------------- --------------
DIGITAL BARRIERS PLC
Consolidated statement of financial position
at 30 September 2016
30 September 30 September
2016 2015 31 March 2016
Unaudited Unaudited Audited
Note GBP'000 GBP'000** GBP'000
------------------------------ ----- ------------- ------------- --------------
Assets
Non current assets
Property, plant and
equipment 1,025 566 828
Goodwill 24,196 18,218 23,323
Other intangible assets 11,519 1,269 11,397
------------------------------ ----- ------------- ------------- --------------
36,740 20,053 35,548
Current assets
Inventories 6,647 3,673 4,906
Trade and other receivables 12,997 7,162 13,239
Other financial asset 425 - 193
Current tax recoverable 657 533 1,022
Cash and cash equivalents* 3,409 16,601 25,599
------------------------------ ----- ------------- ------------- --------------
24,135 27,969 44,959
------------------------------ ----- ------------- ------------- --------------
Non-current assets
classified as held
for resale - 180 35
Total assets 60,875 48,202 80,542
Equity and liabilities
Attributable to owners
of the parent
Equity share capital 6 1,760 845 1,760
Share premium 109,078 82,757 109,078
Deferred shares - 109 -
Capital redemption
reserve 4,786 4,786 4,786
Merger reserve 454 454 454
Translation reserve (281) (840) (745)
Other reserves (307) (307) (307)
Retained earnings (65,184) (54,053) (60,656)
------------------------------ ----- ------------- ------------- --------------
Total equity 50,306 33,751 54,370
Non current liabilities
Deferred tax liabilities 39 89 57
Financial liabilities 1,080 - 975
Provisions 106 188 119
------------------------------ ----- ------------- ------------- --------------
1,225 277 1,151
Current liabilities
Trade and other payables 7,549 3,439 9,126
Financial liabilities 1,759 54 1,097
Bank loan and overdraft* - 10,661 14,763
Provisions 36 20 35
------------------------------ ----- ------------- ------------- --------------
9,344 14,174 25,021
------------------------------ ----- ------------- ------------- --------------
Liabilities directly
associated with non-current
assets classified as
held for sale - - -
------------------------------ ----- ------------- ------------- --------------
Total liabilities 10,569 14,451 26,172
------------------------------ ----- ------------- ------------- --------------
Total equity and liabilities 60,875 48,202 80,542
------------------------------ ----- ------------- ------------- --------------
*Net cash and cash
equivalents (grossed
up above in accordance
with IAS 32) 3,409 6,190 10,836
------------------------------ ----- ------------- ------------- --------------
** Restate for gross up of cash and bank overdraft position in
accordance with IAS 32
DIGITAL BARRIERS PLC
Consolidated statement of changes in equity
for the 6 months ended 30 September 2016
Ordinary Share Capital Profit
share premium redemption Merger Translation Other and loss Total
capital account reserve reserve reserve reserves reserve equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
At 31 March 2015 845 82,757 4,786 454 (868) (307) (48,826) 38,841
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
Loss for the period - - - - - - (5,664) (5,664)
Other comprehensive
income - - - - 28 - - 28
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
Total comprehensive
loss - - - - 28 - (5,664) (5,636)
Incentive share
conversion 109 - - - - - - 109
Share-based payment
credit - - - - - - 437 437
At 30 September 2015 954 82,757 4,786 454 (840) (307) (54,053) 33,751
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
Loss for the period - - - - - - (6,958) (6,958)
Other comprehensive
income - - - - 95 - 95
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
Total comprehensive
loss - - - - 95 - (6,958) (6,863)
Share placement 806 27,394 - - - - - 28,200
Share issue cost - (1,073) - - - - (1,073)
Share-based payment
credit - - - - - - 355 355
At 31 March 2016 1,760 109,078 4,786 454 (745) (307) (60,656) 54,370
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
Loss for the period - - - - - - (4,958) (4,958)
Other comprehensive
income - - - - 464 - - 464
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
Total comprehensive
loss - - - - 464 - (4,958) (4,494)
Share-based payment
credit - - - - - - 430 430
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
At 30 September 2016 1,760 109,078 4,786 454 (281) (307) (65,184) 50,306
----------------------- --------- --------- ------------ --------- ------------ ---------- ---------- --------
DIGITAL BARRIERS PLC
Consolidated statement of cash flows
for the 6 months ended 30 September 2016
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2016 2015 2016
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------------------- ------------- ------------- -----------
Operating activities
Loss before tax (5,140) (5,809) (13,338)
Non-cash adjustment to reconcile
loss before tax to net cash flows
Depreciation of property,
plant and equipment 206 201 415
Amortisation of intangible
assets 902 828 1,530
Impairment of goodwill - - 3,582
Impairment of intangible assets - - 37
Share-based payment transaction
expense 430 437 792
Unrealised (gains)/losses
on foreign exchange (517) - 42
Disposal of fixed assets - - 15
Finance revenue (1,310) (14) (227)
Finance costs 323 2 32
Working capital adjustments:
Decrease / (increase) in trade
and other receivables 701 1,707 (2,452)
(Increase) / decrease in inventories (1,705) 647 2,088
Decrease in trade and other
payables (1,791) (1,681) (1,047)
Increase / (decrease) in deferred
revenue 214 (146) 300
(Decrease) / increase in provisions (14) 47 (8)
---------------------------------------- ------------- ------------- -----------
Cash utilised in operations (7,701) (3,781) (8,239)
Interest paid (8) - (32)
Tax received 546 1,098 1,146
---------------------------------------- ------------- ------------- -----------
Net cash flow from operating
activities (7,163) (2,683) (7,125)
---------------------------------------- ------------- ------------- -----------
Investing activities
Purchase of property, plant &
equipment (377) (84) (375)
Expenditure on intangible assets (7) (5) (12)
Interest received 8 12 27
Acquisition of subsidiary, net
of debt acquired - - (17,511)
---------------------------------------- ------------- ------------- -----------
Net cash flow from investing
activities (376) (77) (17,871)
---------------------------------------- ------------- ------------- -----------
Financing activities
Proceeds from issue of shares - - 28,200
Share issue costs - - (1,073)
Bank loan - 250 -
---------------------------------------- ------------- ------------- -----------
Net cash flow from financing
activities - 250 27,127
---------------------------------------- ------------- ------------- -----------
Net decrease in cash and cash
equivalents (7,539) (2,510) 2,131
Cash and cash equivalents at
beginning of period / year 10,836 8,701 8,701
Effect of foreign exchange rate
changes on cash and cash equivalents 112 (1) 4
---------------------------------------- ------------- ------------- -----------
Cash and cash equivalents at
end of period / year 3,409 6,190 10,836
---------------------------------------- ------------- ------------- -----------
Reconciliation of net cash and
cash equivalents
-------------------------------------- ------ --------- ---------
Cash and cash equivalents (disclosed
within current assets) 3,409 16,601 25,599
Bank overdraft (disclosed within
current liabilities) - (10,411) (14,763)
-------------------------------------- ------ --------- ---------
Net cash and cash equivalents
at end of period / year 3,409 6,190 10,836
-------------------------------------- ------ --------- ---------
DIGITAL BARRIERS PLC
Notes to the financial statements
for the 6 months ended 30 September 2016
1. Accounting policies
Basis of preparation
The consolidated interim financial statements include those of
Digital Barriers plc and all of its subsidiary undertakings
(together "the Group") drawn up at 30 September 2016, and have been
prepared in accordance with International Accounting Standard 34,
"Interim Financial Reporting" ("IAS 34") as adopted for use in the
European Union ("EU"). The consolidated interim financial
statements have been prepared using accounting policies and methods
of computation consistent with those applied in the consolidated
financial statements for the period ended 31 March 2016.
The Company is a public limited company incorporated and
domiciled in England & Wales and whose shares are quoted on
AIM, a market operated by The London Stock Exchange.
Accounting policies
The annual consolidated financial statements of the Group are
prepared on the basis of International Financial Reporting
Standards ("IFRS"). The consolidated interim financial statements
are presented on a condensed basis as permitted by IAS 34 and
therefore do not include all the disclosures that would otherwise
be required in a full set of financial statements and should be
read in conjunction with the most recent Annual Report and Accounts
which were approved by the Board of Directors on 26 June 2016 and
have been filed with Companies House. The condensed interim
financial statements do not constitute statutory accounts as
defined in Section 434 of the Companies Act 2006 and are unaudited
for all periods presented. The financial information for the
12-month period ended 31 March 2016 is extracted from the financial
statements for that period. The auditors' report on those financial
statements was unqualified and did not contain an emphasis of
matter reference and did not contain a statement under section
498(2) or (3) of the Companies Act 2006.
The comparative statement of comprehensive income has been
re-presented as if an operation discontinued during the prior year
had been discontinued from the start of the comparative year. The
comparative statement of financial position has been restated to
gross up cash and cash equivalent balances and bank overdraft
positions (all held within a pooling arrangement within the Group)
in accordance with IAS 32.
Going concern
The Group's loss before tax for continuing operations for the
period was GBP5.0 million (H116: GBP5.3 million). As at 30
September 2016 the Group had net current assets of GBP14.8 million
(31 March 2016: GBP19.9 million) and net cash reserves of GBP3.4
million (31 March 2016: GBP10.8 million).
On 17(th) October the Group replaced an existing GBP5.0 million
secured working capital facility for export activities with HSBC
Bank Plc with a new two year GBP10.0 million secured revolving
credit facility with Investec Bank plc. The funds available through
this facility will be used to meet the increasing working capital
requirements of the Group's organic growth. The facility is secured
by a fixed and floating charge over the Group's assets and includes
covenants which are tested quarterly.
This facility has been factored in to cash flow projections for
the Group.
The Board has reviewed these cash flow forecasts for the period
up to and including 31 December 2017. These forecasts and
projections take into account reasonably possible changes in
trading performance and show that the Group will be able to operate
within the level of current funding resources. The Directors
therefore believe there is sufficient cash available to the Group
to manage through these requirements.
As with all businesses, there are particular times of the year
where the Group's working capital requirements are at their peak.
However, the Group is well placed to manage business risk
effectively and the Board reviews the Group's performance against
budgets and forecasts on a regular basis to ensure action is taken
where needed.
The Directors therefore are satisfied that the Group has
adequate resources to continue operating for a period of at least
12 months from the approval of these accounts. For this reason,
they have adopted the going concern basis in preparing the
financial statements.
Financial instruments
The Group classifies financial instruments, or their component
parts, on initial recognition as a financial asset, a financial
liability or an equity instrument in accordance with the substance
of the contractual arrangement.
Adoption of new and revised International Financial Reporting
Standards
The IASB have further issued amendments to four standards under
Annual improvement 2012-2014 cycle together with amendments to IAS
1. These amendments have an effective date of 1 January 2016.These
have been applied and none have had a material effect on the
Group's performance or financial position for the interim
period.
The standard changes are listed below:-
- IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
- IFRS 7 Financial Instruments: Disclosures
- IAS 19 Employee Benefits
- IAS 34 Interim Financial Reporting
The Directors are still evaluating the impact on the Group of
IFRS 15 - Revenue from contracts with customers, which becomes
effective for annual periods beginning on or after 1 January 2018
and IFRS 16 - Leases, which becomes effective for annual periods
beginning on or after January 2019.
2. Segmental information
Historically the Group was organised into Services and Solutions
divisions for internal management, reporting and decision-making,
based on the nature of the solutions and services of the Group's
businesses. These were the reportable operating segments of the
Group in accordance with IFRS 8 "Operating Segments".
Following the disposal of the Services division in May 2016, the
Group has just one segment namely Solutions. For internal
management and reporting, the chief operating decision maker
reviews revenue and sales data regarding regional components of the
Solutions business. The regional component's operating results are
not included in this analysis at this time. Revenue analysis on the
regional components of the Group is provided below for information,
however the smallest component for which discrete financial
information on the operating result is available and regularly
reviewed by the chief operating decision maker is the Solutions
division (Group) as disclosed in the consolidated income
statement.
6 months ended 30 September 2016
------------------------------------------------------------------------------------
Total
Services NA AP EMEA Solutions
Discontinued Continuing Continuing Continuing Continuing Total
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Total regional revenue 244 10,234 1,395 1,408 13,037 13,281
Inter-region revenue - - - - - -
------------------------ -------------- ------------ ------------ ------------- ------------ -----------
Revenue 244 10,234 1,395 1,408 13,037 13,281
------------------------ -------------- ------------ ------------ ------------- ------------ -----------
6 months ended 30 September 2015
------------------------------------------------------------------------------------
Total
Services NA AP EMEA Solutions
Discontinued Continuing Continuing Continuing Continuing Total
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Total regional revenue 1,232 643 3,990 2,057 6,690 7,922
Inter-region revenue - - - (2) (2) (2)
------------------------ -------------- ------------ ------------ ------------- ------------ -----------
Revenue 1,232 643 3,990 2,055 6,688 7,920
------------------------ -------------- ------------ ------------ ------------- ------------ -----------
Year ended 31 March 2016
------------------------------------------------------------------------------------
Total
Services NA AP EMEA Solutions
Discontinued Continuing Continuing Continuing Continuing Total
Audited Unaudited Unaudited Unaudited Unaudited Unaudited
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Total regional revenue 3,777 5,679 11,014 4,454 21,147 24,925
Inter-region revenue - - - (11) (11) (11)
------------------------ -------------- ------------ ------------ ------------- ------------ -----------
Revenue 3,777 5,679 11,014 4,443 21,136 24,914
------------------------ -------------- ------------ ------------ ------------- ------------ -----------
Note: NA (North America), AP (Asia-Pacific), EMEA (UK, Europe
and Middle East)
3. Adjusted loss before tax
An adjusted loss before tax measure has been presented as the
Directors believe that this is a more relevant measure of the
Group's underlying performance. Adjusted loss is not defined under
IFRS and has been shown as the Directors consider this to be
helpful for a better understanding of the performance of the
Group's underlying business. It may not be comparable with
similarly titled measurements reported by other companies and is
not intended to be a substitute for, or superior to, IFRS measures
of profit. The net adjustments to loss before tax are summarised
below:
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2016 2015 2016
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
--------------------------------------- ------------- ------------- -----------
Amortisation of intangibles initially
recognised on acquisition 864 633 1,320
Share-based payment(i) 430 437 792
Acquisition related costs and
exceptional write off of bad
debt (ii) (509) - 1,718
Total adjustments 785 1,070 3,830
--------------------------------------- ------------- ------------- -----------
(i) The basis of calculation was updated for the year ended 31
March 2016 to adjust for share-based payment charges. The Directors
considered this to be a more helpful measure in understanding the
true underlying costs of the business. The revised calculation
provides consistency over time allowing a better understanding of
the financial position of the Group. Comparatives for the 6 months
ended 30 September 2015 has been updated to reflect this
change.
(ii) During the year ended 31 March 2016 the Group acquired 100%
of the share capital of Brimtek Inc. Costs in relation to the
acquisition totalled GBP1.7 million. Included within these costs is
GBP0.5 million in relation to an amount due from Brimtek to Digital
Barriers which was fully provided for immediately prior to the
acquisition of Brimtek. Acquisition costs remained largely unpaid
as at 31 March 2016. For the 6-month period to 30 September 2016,
GBP0.5 million of these accrued costs were released to the income
statement as no longer due.
4. Loss per share
The basic loss per share is calculated on the loss from
continuing operations attributable to ordinary shareholders and the
weighted average number of shares in issue during the period.
The basic adjusted loss per share is calculated on the adjusted
loss after tax and the weighted average number of shares in issue
during the period.
The following reflects the loss and share data used in the basic
and diluted loss per share calculations:
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2016 2015 2016
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss from continuing operations
attributable to ordinary shareholders (4,766) (5,163) (7,790)
Amortisation of intangibles
initially recognised on acquisition,
net of tax 839 605 1,264
Share-based payment 430 437 792
Acquisition related costs and
exceptional write off of bad
debt (509) - 1,718
Adjusted loss after tax (4,006) (4,121) (4,016)
---------------------------------------- --------------- --------------- ------------
Weighted average number of shares 165,111,309 84,511,031 105,052,916
---------------------------------------- --------------- --------------- ------------
Basic and diluted loss per share (2.88p) (6.11p) (7.42p)
---------------------------------------- --------------- --------------- ------------
Basic and diluted adjusted loss
per share* (2.42p) (4.88p) (3.82p)
---------------------------------------- --------------- --------------- ------------
* As explained in note 3, the basis of calculation was adjusted
in 31 March 2016 to include share-based payment charges.
Comparative figures for the period to 30 September 2015 has been
updated to incorporate this change
The inclusion of potential Ordinary Shares arising from LTIPs
and Incentive Shares would be anti-dilutive. Basic and diluted loss
per share has therefore been calculated using the same weighted
number of shares.
5. Goodwill
Carrying amount of goodwill allocated to operating segments:
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2016 2015 2016
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------- --------------- --------------- -----------
Services - 3,582 -
Solutions 24,196 14,636 23,323
Goodwill 24,196 18,218 23,323
----------- --------------- --------------- -----------
Goodwill acquired through business combinations has historically
been allocated for impairment testing purposes to two groups of
cash-generating units ('CGUs'). These groups of CGUs were the two
operating segments 'Services' and 'Solutions' as the goodwill
relates to synergies at this level. Following the disposal of the
Services business in May 2016, there remains only one CGU within
the Group - the Solutions division.
The Group conducts annual impairment tests on the carrying value
of the CGUs in the statement of financial position as at 28
February each year. Impairment testing is only re-performed if an
impairment triggering event occurs in the intervening period. Given
the fact the acquisition of Brimtek on 1 March 2016 an update to
the impairment calculations has been undertaken to ensure the
carrying value of goodwill attributable to newly enlarged Solutions
division remains valid. Based on the review, no impairment to
goodwill has been recorded in the period.
Value in use calculations are used to determine the recoverable
amount of cash-generating units. The key assumptions for the value
in use calculations remain the forecast revenue growth of each CGU,
the discount rate applied and the long-term growth rate of the net
operating cash flows, along with the gross margin for Solutions. In
determining the key assumptions, management have taken into
consideration the expected growth of the markets in which it
operates, the ability of the CGU to exploit those opportunities and
the current economic climate, the resulting impact on expected
growth and pre-tax discount rates, and the pressure this places on
impairment calculations.
The Group has prepared updated cash flow forecasts for the
business based on the most recent three-year detailed financial
forecasts. These cash flow forecasts take into account recent
trading performance, with the resulting profit forecast over the
period to FY18 remaining materially unchanged from the profit
forecast within the annual impairment review carried out as at 29
February 2016. The key assumptions that supported that impairment
review are detailed on page 62 of the 2016 Annual Report.
As in prior period, the Directors have also considered
reasonably possible changes in the key assumptions used within the
forecasts. Sensitivities within the Solutions division remain
largely unchanged on those detailed on page 63 of the 2016 Annual
Report with no impairment arising.
The movement in Goodwill in the period is a result of foreign
exchange movement (increase GBP1.2m) and a measurement period
adjustment of the 1 March 2016 position (decrease GBP0.3m).
The carrying value of goodwill remains valid.
6. Issued share capital
As at 30 September 2016, there were 165,130,024 Ordinary Shares
in issue (30 September 2015: 84,534,810, 31 March 2016:
165,106,239). In addition, there were 108,749 Deferred Shares in
issue (30 September 2015: nil, 31 March 2016: 108,749).
7. Share options
The following share awards were granted in the period:
HMRC
Approved Parallel
Options Options Top-Up Part A Sharesave
July July awards awards options
2016 2016 July 2016 July 2016 July 2016
----------------------------- ---------- --------- ----------- ----------- -----------
Number granted 344,214 344,214 1,493,286 305,000 1,717,853
----------------------------- ---------- --------- ----------- ----------- -----------
Fair value per option/award GBP0.16 GBP0.32 GBP0.48 GBP0.48 GBP0.22
----------------------------- ---------- --------- ----------- ----------- -----------
Exercise price GBP0.48 nil nil nil GBP0.31
----------------------------- ---------- --------- ----------- ----------- -----------
Vesting period (years) 3.0 3.0 3.0 3.0 3.0
----------------------------- ---------- --------- ----------- ----------- -----------
The vesting and exercise of these awards are subject to certain
performance conditions relating to revenue and profit in the
performance period.
The share-based payment charge in the period amounts to
GBP0.4million (H116: GBP0.4million), with the fair value charge
attributable to new awards in the period determined using a Black
Scholes calculation. Share option awards made prior to 2015 have
been made with a market based performance measure which in the
event that LTIPS fail to vest the share-based payment charge is not
added back to the income statement. To date the majority of these
historic LTIP awards have failed to vest.
During the half-year the Group relaunched the Digital Barriers
Sharesave Scheme, which allows eligible employees to use regular
savings to purchase shares. 1,717,853 shares were issued as a
result, and employees surrendered 442,060 options in relation to
the 2014 Sharesave scheme in the period, resulting in an
acceleration of the remaining share-based payment charge
attributable to these options of GBP0.3million.
8. Related party transactions
On 28 July 2016 the Remuneration Committee of the Group made a
conditional award to Colin Evans, Zak Doffman and Sharon Cooper,
under the rules of The Digital Barriers Long Term Incentive Plan
(the "Plan"). The vesting and exercise of these awards are subject
to certain performance conditions relating to revenue and profit in
the performance period.
Top-up award
(no of shares)
--------------- ----------------
Colin Evans 250,000
--------------- ----------------
Zak Doffman 500,000
--------------- ----------------
Sharon Cooper 200,000
--------------- ----------------
Full details of the plan can be found in the 2016 Annual Report
on page 34.
9. Financial instruments
Fair value hierarchy
The Group uses the following hierarchy for determining and
disclosing the fair values of financial instruments by valuation
techniques:
Level 1: quoted (unadjusted) prices in active markets for
identical assets or liabilities;
Level 2: other techniques for which all inputs which have a
significant effect on the recorded fair value are observable,
either directly or indirectly; and
Level 3: techniques which use inputs which have a significant
effect on the recorded fair value that are not based on observable
market data.
The Group have a Level 3 financial liability of GBP2.2 million
of deferred consideration measured at fair value on a recurring
basis at (31 March 2016: GBP2.0m) following the acquisition of
Brimtek Inc. The fair value of deferred consideration at the
acquisition date was estimated at GBP2.1 million (discounted). This
has been estimated based on a weighted average probability
calculation, with probability distributions applied to various
revenue and gross margin ranges. The deferred consideration payable
is sensitive to movements in the revenue and gross margin outcomes
versus target. No deferred consideration is payable at threshold
revenue targets or threshold gross margin targets. A $5 million
increase in the revenue earned in the year ended 31 December 2016
compared to the threshold target (at full target gross margin)
would result in a $2.5 million increase in the deferred
consideration due. Significant increases in the revenue and gross
margins of Brimtek Inc. would result in higher fair value of the
deferred consideration liability. The movement in the deferred
consideration for the period is due to exchange rate movement.
The Group have a Level 2 financial liability of GBP0.3 million
of financial swap measured at fair value. The fair values of other
financial assets and liabilities, which are short term, are not
disclosed as the Directors estimate that the carrying amount of the
financial assets and liabilities are not significantly different to
their fair value. These financial assets and liabilities are
carried at amortised cost.
10. Disposal group classified as held for sale
On 1 April 2016 the Board signed an agreement for the proposed
disposal of the Services segment to its existing management team
for GBP1, the sale completed on 19 May 2016. As indicated in the
interim results announcement on 11 December 2015, this follows the
view that the Board believed that the Services division was no
longer strategic to the Group's future. The disposal group was
classified as held for sale in March 2016, with full details on the
assets and liabilities classified as held for sale as at 31 March
2016 disclosed in note 26 on page 77 of the 2016 Annual Report.
The sale included limited ongoing customer contracts associated
with the Services segment, as well as certain assets including
vehicle leases and limited stock and moveable assets. The book
value of the assets transferred was GBP0.1 million. In connection
with the sale the Group transferred the division's employees, by
way of a TUPE process.
In the six months ended 30 September 2016 revenues attributable
to the disposal group amounted to GBP0.2 million (H116: GBP1.2
million, FY16: GBP3.7 million) with a loss attributable to the
discontinued operation of GBP0.2 million (H116: GBP0.5 million,
FY16: GBP4.8 million). Full details on the income statement and
cash flows attributable to the disposal group for the year ended 31
March 2016 are disclosed in note 26 on page 77 of the 2016 Annual
Report.
The basic and diluted loss per share for the six months ended 30
September 2016 is 0.12 pence (H116: 0.59 pence, FY16: 4.60 pence)
based on 165,111,309 (H116: 84,511,031, FY16: 105,052,916) weighted
average shares in issue. The inclusion of potential Ordinary Shares
arising from LTIPs and Incentive Shares would be anti-dilutive.
Basic and diluted loss per share has therefore been calculated
using the same weighted number of shares.
11. Post balance sheet event
On 17(th) October the Group replaced an existing GBP5.0 million
secured working capital facility for export activities with a new
two year GBP10.0 million secured revolving credit facility with
Investec Bank plc. The funds available through this facility will
be used to meet the increasing working capital requirements of the
Group's organic growth. The facility is secured by a fixed and
floating charge over the Group's assets and includes covenants
which are tested quarterly.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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