TIDMARC
RNS Number : 4912I
Arcontech Group PLC
26 March 2015
ARCONTECH GROUP PLC
("Arcontech" or the "Group")
INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2014
Arcontech (AIM: ARC), the provider of products and services for
real-time financial market data processing and trading, is pleased
to report its unaudited results for the six months ended 31
December 2014.
Financial and business highlights:
-- Turnover increased by 7% to GBP1,041,599 (six months ended 31 December 2013: GBP976,578).
-- Operating profit increased to GBP115,900 (six months ended 31
December 2013: loss of GBP68,976).
-- Annual run-rate of recurring revenues at 31 December 2014
amount to GBP2.1 million (2013: GBP1.9 million) and cover 112% of
the cost base.
-- Net cash of GBP1,073,948 at 31 December 2014 (31 December 2013: GBP664,098).
Richard Last, Chairman of Arcontech, said:
"The Board is pleased that the Group is making progress in
delivering increasing levels of turnover and profitability in the
medium to longer term. However, the level of profitability for the
current year ending 30 June 2015 is uncertain, due to a significant
customer requesting the termination of its contract 18 months early
for reasons outside of our control. We are currently working to
resolve the situation. Although we expect to achieve new sales wins
before the year end, due to revenue on our contracts being taken to
profit on a monthly basis, it is unlikely that we will be able to
fully compensate for the loss of revenue should the contract be
terminated. Nevertheless, the Board believes Arcontech will deliver
a positive result for the six months ending 30 June 2015. With
current net cash balances in excess of GBP1.2m and a healthy sales
pipeline, we remain positive about the Group's prospects."
Enquiries:
Arcontech Group plc
Richard Last, Chairman and
Non-Executive Director 07713 214484
020 7256
Matthew Jeffs, Chief Executive 2300
finnCap Ltd
Charlotte Stranner/ Simon 020 7220
Hicks 0500
To access more information on the Group please visit:
www.arcontech.com
The interim report will only be available to view online
enabling the Group to communicate with shareholders in a more
environmentally friendly and cost effective manner.
Chairman's Statement
I am pleased to report that Arcontech has moved into
profitability in the six months ended 31 December 2014. The
operating profit for the period was GBP115,900, compared to an
operating loss of GBP68,796 in the corresponding six month period
ended 31 December 2013. This was achieved by an increase in
turnover as well as operating efficiencies and cost reductions.
Turnover for the six month period increased by 7% to GBP1,041,599
(six month period ended 31st December 2013: GBP976,578) of which
GBP1,035,399 relates to recurring annual licence fees (six month
period ended 31 December 2013: GBP962,378). At the same time,
operating efficiencies and tight control of expenses resulted in
cost reductions amounting to GBP119,855 compared to the
corresponding period last year.
The sales cycle continues to take longer than we would like,
however, our pipeline of qualified prospects remains encouraging.
We are committed to product development focused both on enhancing
our solutions for existing customers in response to their feedback,
as well as developing new products. In particular, we have
developed an interface to Open MAMA and Solace Systems, as well as
working with FactSet Systems to enable them to receive and display
real time data.
Financing
Arcontech is well financed, with net cash balances at 31
December 2014 of GBP1,073,948 (31 December 2013: GBP664,098). This
represents an increase of GBP409,850 since the year end at 30 June
2014. Net cash at 19 March 2015 was GBP1,294,061. This places
Arcontech in a positive position to maintain its level of product
development and increase its sales capability.
Employees
I would like to thank our employees and my fellow directors for
their hard work and support over the last six months. It is
essential, particularly in small businesses, that everyone works
together as a team and has a flexible approach. As a result this
has enabled the Group to achieve profitability.
Outlook
The Board is pleased that the Group is making progress in
delivering increasing levels of turnover and profitability in the
medium to longer term. However, the level of profitability for the
current year ending 30 June 2015 is uncertain, due to a significant
customer requesting the termination of its contract 18 months early
for reasons outside of our control. We are currently working to
resolve the situation. Although we expect to achieve new sales wins
before the year end, due to revenue on our contracts being taken to
profit on a monthly basis, it is unlikely that we will be able to
fully compensate for the loss of revenue should the contract be
terminated. Nevertheless, the Board believes Arcontech will deliver
a positive result for the six months ending 30 June 2015. With
current net cash balances in excess of GBP1.2m and a healthy sales
pipeline, we remain positive about the Group's prospects.
Richard Last
Chairman and Non-Executive Director
CONSOLIDATED INCOME STATEMENT
Six months Six months Year ended
ended ended 30 June
31 31
December December
2014 2013 2014
(unaudited) (unaudited) (audited)
GBP GBP GBP
Revenue 1,041,599 976,578 1,981,375
Distribution costs - - (31,439)
Administrative costs (925,699) (1,045,554) (1,989,156)
Operating profit/(loss) 115,900 (68,976) (39,220)
Finance income 1,032 2,241 3,655
Profit/(loss) before
taxation 116,932 (66,735) (35,565)
Taxation 109,378 - 100,251
Profit/(loss) for
the period after
tax 226,310 (66,735) 64,686
Total comprehensive
income 226,310 (66,735) 64,686
Profit/(loss) per
share (basic) 0.015p (0.004)p 0.004p
Profit/(loss) per
share (diluted) 0.014p (0.004)p 0.004p
All of the results relate to continuing operations.
CONSOLIDATED BALANCE
SHEET
31 December 31 December 30 June
2014 2013 2014
(unaudited) (unaudited) (audited)
GBP GBP GBP
Non-current assets
Goodwill 1,715,153 1,715,153 1,715,153
Property, plant
and equipment 15,531 22,162 19,112
Total non-current
assets 1,730,684 1,737,315 1,734,265
Current assets
Trade and other
receivables 757,616 254,526 361,016
Cash and cash equivalents 1,073,948 664,098 733,676
Total current assets 1,831,564 918,624 1,094,692
Current liabilities
Trade and other
payables (609,224) (485,184) (561,434)
Deferred income (1,303,096) (892,790) (850,638)
Total current liabilities (1,912,320) (1,377,974) (1,412,072)
Net current liabilities (80,756) (459,350) (317,380)
Net assets 1,649,928 1,277,965 1,416,885
Equity
Share capital 1,536,672 1,531,315 1,536,672
Share premium account 9,430,312 9,428,169 9,430,312
Share option reserve 79,295 271,912 72,562
Retained earnings (9,396,351) (9,953,431) (9,622,661)
1,649,928 1,277,965 1,416,885
CONSOLIDATED CASH FLOW STATEMENT
Six months Six months Year ended
ended ended 30 June
31 31
December December
2014 2013 2014
(unaudited) (unaudited) (audited)
GBP GBP GBP
Net cash generated from/(used
in) operating activities 340,259 (213,830) (151,013)
Investing activities
Interest received 1,032 2,241 3,655
Sales of plant and equipment 166 - -
Purchases of plant and
equipment (1,185) (3,117) (5,270)
Issue of shares - - 7,500
Net cash generated from/(used
in) investing activities 13 (876) 5,885
Net increase/(decrease)
in cash and cash equivalents 340,272 (214,706) (145,128)
Cash and cash equivalents
at beginning of period 733,676 878,804 878,804
Cash and cash equivalents
at end of period 1,073,948 664,098 733,676
============ ============ ============
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Share Share-based Retained Total
capital premium paymentsreserve earnings
GBP GBP GBP GBP GBP
At 1 July
2013 1,531,315 9,428,169 253,234 (9,886,696) 1,326,022
Loss and comprehensive
income for
the period - - - (66,735) (66,735)
Share-based
payments - - 18,677 - 18,677
At 31 December
2013 1,531,315 9,428,169 271,911 (9,953,431) 1,277,964
------------------------ ------------ ------------ ----------------- -------------- ------------
Total comprehensive
income for
the period - - - 131,421 131,421
Issue of shares 5,357 2,143 - - 7,500
Share-based
payments - - - - -
Share-based
payments provision
released - - (199,349) 199,349 -
At 30 June
2014 1,536,672 9,430,312 72,562 (9,622,661) 1,416,885
------------------------ ------------ ------------ ----------------- -------------- ------------
Total comprehensive
income for
the period - - - 226,310 226,310
Share-based
payments - - 6,733 - 6,733
At 31 December
2014 1,536,672 9,430,312 79,295 (9,396,351) 1,649,928
------------------------ ------------ ------------ ----------------- -------------- ------------
NOTES TO THE FINANCIAL INFORMATION
1. The figures for the six months ended 31 December 2014 and 31
December 2013 are unaudited and do not constitute statutory
accounts. The interim results have been prepared using accounting
policies which are consistent with International Financial
Reporting Standards as adopted by the European Union and are
expected to be adopted in the next annual accounts.
The financial information for the year ended 30 June 2014 set
out in this interim report does not comprise the Group's statutory
accounts as defined in section 434 of the Companies Act 2006. The
statutory accounts for the year ended 30 June 2014, which were
prepared under International Financial Reporting Standards (IFRS)
as adopted for use in the EU, applied in accordance with the
provisions of the Companies Act 2006, have been delivered to the
Registrar of Companies. The auditors reported on those accounts;
their report was unqualified and did not contain a statement under
either Section 498(2) or Section 498(3) of the Companies Act 2006
and did not include references to any matters to which the auditor
drew attention by way of emphasis
2. Copies of this statement are available from the Company
Secretary at the Company's registered office at 8th Floor Finsbury
Tower, 103-105 Bunhill Row, London, EC1Y 8LZ or from the Company's
website at www.arcontech.com.
3. Earnings per share have been calculated based on the profit
after tax and the weighted average number of shares in issue during
the half year ended 31 December 2014 of 1,536,672,013 (31 December
2013: 1,531,314,870; 30 June 2014: 1,536,672,013). The number of
dilutive shares under option at 31 December 2014 was 56,247,024 (31
December 2013: Nil; 30 June 2014: 13,314,419).The calculation of
diluted earnings per share assumes conversion of all potentially
dilutive ordinary shares, all of which arise from share options. A
calculation is done to determine the number of shares that could
have been acquired at fair value, based upon the monetary value of
the subscription rights attached to outstanding share options.
4. Taxation is based on the unaudited results and provision has
been estimated at the rate applicable to the Company at the time of
this statement and expected to be applied to the total annual
earnings, adjusted for cash recovery of Research & Development
tax credits during the period.
5. There were no dividends paid or proposed during the period (2013: Nil).
6. The Directors have elected not to apply IAS34 Interim financial reporting.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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