TIDMARTA
RNS Number : 6704A
Artilium PLC
28 March 2017
For immediate release 28 March 2017
Artilium plc
("Artilium" or the "Company" or the "Group")
Half yearly results for the six months ended 31 December
2016
Artilium plc (LSE/AIM: ARTA), the AIM quoted provider of
innovative telecommunication software and solutions, announces its
unaudited half yearly results for the six months ended 31 December
2016.
Highlights
-- Revenue for the six months to 31 December 2016 was EUR 5.1
million (2015: EUR 4.3 million)
-- Adjusted EBITDA of EUR 0.1 million (2015: EUR -0.2
million)
-- Net loss after tax of EUR 0.9 million (2015: net loss after
tax of EUR 0.8 million)
-- Several new MVNOs activated and new large customers won on
cloud PBX
-- Successful integration of Ello Mobile, acquired in December
2016
Post Period End
-- Telenet licence renewed in February 2017 for EUR 5.3m for
services over the next five years
Commenting on the results and outlook, Jan-Paul Menke,
Non-Executive Chairman of Artilium said:
"Artilium has made strong progress in the last six months with
increasing volumes of our ARTA(R) software delivered as well as
building a healthy order book."
"The telecommunication market continues to move towards
innovative software and consequently we are benefiting from this as
a leading provider of these services. Our cloud and datacentre
telecom solutions make us attractive on a worldwide scale,
particularly in emerging markets. We are now active in numerous
countries and additional business growth is expected, especially
from new markets such as Africa."
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
For further information please contact:
Artilium PLC +32 (0) 5023 0300
Bart Weijermars - Chief Executive
Officer
finnCap Ltd
Jonny Franklin-Adams / Scott
Mathieson (corporate finance) +44 (0) 207 220
Camille Gochez (corporate broking) 0500
+44 (0) 207 466
Buchanan 5000
Richard Darby / Jamie Hooper
/ Catriona Flint
About Artilium
Artilium is a demonstrated leader in the development of next
generation communication technologies. Artilium's strategy focuses
on supporting its customers to successfully grow their business by
providing flexible, cost effective and innovative solutions.
Artilium's innovation-driven strategy empowers telecom operators
around the globe to face the tremendous challenges ahead. We
combine next-generation technology with traditional telecom
environments to create exciting new business opportunities for our
customers. This ensures that our customers are able to keep up with
rapidly evolving market demands while simultaneously growing their
businesses.
ARTA(R) is the real-time Authentication, Authorization and
Accounting (AAA) software that brings a full suite of new
functionalities to telecom Operators and virtual Operators. Thanks
to ARTA(R) value-added services portfolio, including for instance
AAA of voice, text and data services, VoIP, 3G and 4G compliance,
mobile payments and location-based services, our partners are more
than ready to meet future customer needs.
Today, multiple renowned national and international
telecommunication companies rely on Artilium to deliver voice, text
and data services to about 1.5 million end users every day.
Artilium's "Pay-As-You-Grow" model allows us to scale our
solutions to the exact needs of our customers. As a latest
innovation, Artilium offers its product suite from the Cloud as a
PAAS (Platform As A Service), yielding ARTA's scalability,
flexibility and proven stability.
Artilium plc is a publicly listed software company on the London
Stock Exchange (LSE/AIM: ARTA).
Forward Looking Statements
This report contains certain "forward looking" statements and
information relating to the Company that are based on the beliefs
of the Company's management as well as assumptions made by and
information currently available to the Company's management. When
used in this report, the words "anticipate", "believe", "estimate",
"expect", and "intend" and words or phrases of similar import, as
they relate to the Company or its subsidiaries or Company
management, are intended to identify forward-looking statements.
Such statements reflect the current risks, uncertainties and
assumptions related to certain factors including, without
limitation, competitive factors, general economic conditions,
customer relations, relationships with vendors, borrowing
arrangements, interest rates, foreign exchange rates, litigation,
governmental regulation and supervision, seasonality, product
introductions and acceptance, technological change, changes in
industry practices, one-time events and other factors described
herein and in other announcements made by the Company. Based upon
changing conditions, should any one or more of these risks or
uncertainties materialise, or should any underlying assumptions
prove incorrect, actual results may vary materially from those
described herein as anticipated, believed, estimated, expected or
intended. The Company does not intend to update these
forward-looking statements.
Chief Executive's Statement
Introduction
We have made strong progress in the last six months with the
delivery of increasing volumes of new software and building a
healthy order book. Our international list of prospects for our
products and services is growing, giving us confidence in expanding
our international customer base.
Financial results
Reported revenue for the six months to 31 December 2016 of EUR
5.1 million (2015: EUR 4.3 million) was generated primarily from
maintenance and professional services rendered to existing
customers and by United Telecom fixed calling, broadband and mobile
services. The Group generated a gross profit of EUR 3.8 million or
74.3 per cent. of reported revenue (2015: EUR 2.8 million or 65.3
per cent. of reported revenue) and generated an adjusted EBITDA of
EUR 0.1 million (2015: EUR -0.2 million).
The Group reported a net loss after tax of EUR 0.9 million
(2015: net loss after tax of EUR 0.8 million).
Business overview
The Artilium business delivered a successful release of its
billing and activation software to its fast growing strategic
partner in datacentre technology Green IT Globe ("GIG"). The
business also secured a strategic alliance with GIG to successfully
launch the OneApp, which is capturing the mobile data cloud market.
The agreement with GIG is aimed at the rapidly growing African and
Asian markets where consumption and the need for mobile storage and
cloud services are rapidly increasing. According to Cisco Global
Cloud Index ("GCI"), global storage requirements are expected to
grow from 14 exabyte ("EB") annually in 2014 to 39 EB by 2019 at a
compound annual growth rate of 23 per cent, which presents
significant future opportunity for the Group. We are pleased to
confirm that Artilium has signed its first customer within the
Africa region, and hope to sign more within our target emerging
markets.
At United Telecom ("United"), several new MVNOs were activated
and new large customers won on cloud PBX. Ello Mobile, acquired in
December 2016, is an excellent mobile brand with a loyal following
to United's offering and has been successfully integrated. United
has returned to growth as its product capabilities and pricing of
its offering have been strengthened.
At Comsys, our specialist interactive telephony services
business, performance was solid during the first half and
integration with the Artilium platform is going well, allowing the
business to sell additional value added services to both existing
and new customers. We are particularly encouraged by the
integration of Livecom into Comsys and the wider Artilium group.
The Group can now offer customers and potential customers with a
multi-channel call centre solution, and through these Group
synergies we can offer clients the full range of services, which
positions us well for future growth.
The telecommunications market continues to move towards
innovative software and consequently we are benefiting from this as
a leading provider of these services. Our cloud and datacentre
telecom solutions make us attractive on a worldwide scale. We are
now active in numerous countries and additional business growth is
expected, especially from Africa.
I would like to thank all employees and shareholders for their
efforts and trust in the management team as we continue to build
momentum and add further value to our customers.
Current trading
In January 2017, we secured an expanded MVNE platform agreement
with our largest customer, Telenet Group BVBA ("Telenet"), securing
the relationship for the next five years. Telenet has decided,
given the importance of the partnership and their overall
satisfaction with our solutions, to make a commitment to us for the
services it is due to receive over the next five years. As part of
the extension, we have received cash of EUR5.3 million, comprising
revenue which will be recognised in equal instalments over the next
five years. New opportunities are also developing in the Internet
of Things ("IoT") market and from this we are developing billing
and invoicing software as well as cloud services from which we
expect further growth going forward. We are investing in additional
platform capabilities to capture this growing market in the
future.
Bart Weijermars
28 March 2017
CONDENSED CONSOLIDATED INCOME STATEMENT
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
------------------------------- ------ ------------ ------------ --------
Continuing Operations
Revenue 5,090 4,322 9,622
Cost of sales (1,310) (1,497) (2,599)
------------------------------- ------ ------------ ------------ --------
Gross profit 3,780 2,825 7,023
Other operating income - 1 -
Depreciation and amortization (818) (590) (1,411)
------------------------------- ------ ------------ ------------ --------
Administrative expenses
before redundancy costs (3,633) (3,043) (6,835)
Redundancy costs (92) (16) (294)
------------------------------- ------ ------------ ------------ --------
Administrative expenses (3,732) (3,059) (7,129)
Operating loss (770) (823) (1,517)
Finance costs (176) (104) (200)
------------------------------- ------ ------------ ------------ --------
Loss before tax (946) (927) (1,717)
Tax credit 88 122 191
------ ------------ ------------ --------
Loss for the period from
continuing operations
attributable to owners
of the Company (858) (805) (1,526)
------------------------------- ------ ------------ ------------ --------
Earnings per share from
continuing operations
(cents) 3 (0.29) (0.30) (0.54)
------------------------------- ------ ------------ ------------ --------
A key performance indicator for the Group is adjusted EBITDA.
This was EUR 0.1 million for the six months to December 2016 (2015:
EUR -0.2 million). The reconciliation of adjusted EBITDA to the
income statement is disclosed below.
Reconciling table operating result-adjusted EBITDA
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
---------------------------- ------------ ------------ --------
Operating loss (770) (823) (1,517)
Redundancy costs 92 16 294
Depreciation, amortization
and impairments 818 590 1,536
---------------------------- ------------ ------------ --------
Adjusted EBITDA 140 (217) 313
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
------------------------------------- ------------ ------------ --------
Loss for the period (858) (805) (1,526)
Other comprehensive income:
Items that may be subsequently
reclassified to profit or
loss
Exchange differences on translation
of foreign operations 51 26 (10)
Total comprehensive income
for the period attributable
to owners of the Company (807) (779) (1,536)
-------------------------------------- ------------ ------------ --------
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
------------------------------- ---------- ------------ ------------ --------
Non-current assets
Goodwill 2 17,127 16,754 17,127
Other intangible assets 4,297 4,724 4,286
Property, plant and equipment 451 482 471
Deferred tax asset - 560 -
21,875 22,520 21,884
------------------------------- ---------- ------------ ------------ --------
Current assets
Inventories 106 86 131
Trade and other receivables 4,073 5,749 3,922
Cash and cash equivalents 2,301 129 422
6,480 5,964 4,475
------------------------------- ---------- ------------ ------------ --------
Total assets 28,355 28,484 26,359
------------------------------- ---------- ------------ ------------ --------
Non-current liabilities
Deferred tax liabilities 658 1,088 485
Bank loans - - 40
Other borrowings 800 914 1,539
Other payables 145 - -
1,603 2,002 2,064
------------------------------- ---------- ------------ ------------ --------
Current liabilities
Trade and other payables 5,985 6,771 5,795
Other borrowings 2,574 620 161
Bank loans 268 312 254
------------------------------- ---------- ------------ ------------ --------
8,827 7,703 6,210
Total liabilities 10,430 9,705 8,274
------------------------------- ---------- ------------ ------------ --------
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(Continued)
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
------------------------------- ------ ------------ ------------ ---------
Equity attributable to owners
of the Company
Share capital 4 20,123 19,549 19,601
Share premium account 47,504 47,368 47,379
Merger relief reserve 1,488 1,488 1,488
Capital redemption reserve 6,503 6,503 6,503
Translation reserve (2,292) (2,307) (2,343)
Own shares (2,336) (2,336) (2,336)
Retained deficit (53,065) (51,486) (52,207)
Total equity 17,925 18,779 18,085
------------------------------- ------ ------------ ------------ ---------
Total liabilities and equity 28,355 28,484 26,359
------------------------------- ------ ------------ ------------ ---------
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Merger Capital
Share premium relief redemption Translation Own Retained
capital account reserve reserve reserve shares deficit Total
Eur'000 Eur'000 Eur'000 Eur'000 Eur'000 Eur'000 Eur'000 Eur'000
------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Balance at 1
July 2016 19,601 47,379 1,488 6,503 (2,343) (2,336) (52,207) 18,085
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Unaudited:
Nominal value
of shares
issued 522 - - - - - - 522
Premium
arising on
issue of
placement
shares - 125 - - - - - 125
Total
transaction
with owners,
recognised
directly in
equity 522 125 - - - - - 647
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Profit for the
period - - - - - - (858) (858)
Other
comprehensive
income
- currency
translation
differences - - - - 51 - - 51
Total
comprehensive
income
for the
period - - - 51 - (858) (807)
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Balance at 31
December 2016 20,123 47,504 1,488 6,503 (2,292) (2,336) (53,065) 17,925
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Share Merger Capital
Share premium relief redemption Translation Own Retained
capital account reserve reserve reserve shares deficit Total
Eur'000 Eur'000 Eur'000 Eur'000 Eur'000 Eur'000 Eur'000 Eur'000
------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Balance at 1
July 2015 15,415 46,748 1,488 6,503 (2,333) (2,336) (50,681) 14,804
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Unaudited:
Nominal value
of shares
issued 4,134 - - - - - 4,134
Premium
arising on
issue of
placement
shares 620 - - - - - 620
Total
transaction
with owners,
recognised
directly in
equity 4,134 620 - - - - - 4,754
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Loss for the
period - - - - - - (805) (805)
Other
comprehensive
income
- currency
translation
differences - - - - 26 - - 26
Total
comprehensive
income
for the
period - - - 26 - (805) (779)
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
Balance at 31
December 2015 19,549 47,368 1,488 6,503 (2,307) (2,336) (51,486) 18,779
--------------- ------------ --------- --------------------- --------------------- --------------------- --------------------- --------------------- --------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
------------------------------------ ------------ ------------ --------
Net cash generated from/(used
in) operating activities 1,295 (878) (1,261)
------------------------------------ ------------ ------------ --------
Investing activities
Acquisition of subsidiaries
and businesses, net of cash
acquired - - (143)
Purchases of intangible fixed
assets (4) (175) (348)
Purchases of property, plant
and equipment - - (40)
Net cash used in investing
activities (4) (175) (531)
------------------------------------ ------------ ------------ --------
Financing activities
Proceeds from borrowings 920 657 2,000
Interest paid (176) (42) (200)
Repayment of borrowings (156) (168) (321)
Net cash from financing activities 588 447 1,479
------------------------------------ ------------ ------------ --------
Net increase/(decrease) in
cash and cash equivalents 1,879 (606) (313)
Cash and cash equivalents
at beginning of the period 129 735 735
Cash and cash equivalents
at the end of the period 2,301 129 422
------------------------------------ ------------ ------------ --------
Non-cash transactions
The principal non-cash transactions comprise the issue of shares
as consideration for business combinations and the issue of shares
to settle Group liabilities.
NOTES TO THE CONDENSED CONSOLIDATED HALF YEARLY FINANCIAL
STATEMENTS
1. Nature of operations and general information
Artilium plc and its subsidiaries (together 'the Group')
operates in the business to business communications sector
delivering innovative software solutions which layer seamlessly
over disparate fixed, mobile and IP networks to enable the
deployment of converged services and applications. Artilium plc is
incorporated and domiciled in the United Kingdom. The address of
its registered office is 9-13 St. Andrew Street, London EC4A 3AF.
The Group's principal place of business is Belgium and the
Netherlands.
2. Basis of preparation
These unaudited condensed consolidated half yearly financial
statements have been prepared under the historical cost convention
and in accordance with the AIM Rules for Companies. As permitted,
the Group has chosen not to adopt IAS 34 "Interim Financial
Statements" in preparing this interim financial information. The
unaudited condensed consolidated half yearly financial statements
should be read in conjunction with the annual financial statements
for the year ended 30 June 2016, which have been prepared in
accordance with International Financial Reporting Standards (IFRS)
as adopted by the European Union.
The unaudited condensed consolidated half yearly financial
statements do not constitute statutory financial statements within
the meaning of the Companies Act 2006. They have been prepared on a
going concern basis in accordance with the recognition and
measurement criteria of IFRSs as adopted by the European Union.
Statutory financial statements for the year ended 30 June 2016 were
approved by the Board of Directors on 3 November 2016 and delivered
to the Registrar of Companies. The report of the auditor on those
financial statements was unqualified.
The same accounting policies, presentation and methods of
computation are followed in these unaudited condensed consolidated
half yearly financial statements as were applied in the preparation
of the Group's annual audited financial statements for the year
ended 30 June 2016.
The preparation of unaudited condensed consolidated half yearly
financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at
the end of the reporting period. Significant items subject to such
estimates are set out in the Group's Annual Report and Financial
Statements for the year ended 30 June 2016. Except as described
below, the nature and amounts of such estimates have not changed
significantly during the interim period.
The presentational currency of the Group is round thousand
Euros.
Basis of consolidation
The unaudited condensed consolidated half yearly financial
statements incorporate the financial statements of Artilium plc and
the entities controlled by the Company. Control is achieved when
the Group is exposed, or has rights, to variable returns from its
involvement with the investee and has the ability to affect those
returns through its power over the investee.
All material intra-group transactions, balances, income and
expenses are eliminated on consolidation.
Going concern
The Directors have adopted the going concern basis in preparing
the condensed consolidated half yearly financial statements, having
carried out a going concern review. In carrying out the review the
Directors have made assumptions about the future revenue that will
be generated based on its pipeline, together with the renegotiation
of the repayment terms of certain borrowings. The Directors are
satisfied that the going concern basis is appropriate.
Intangibles
IAS 36 requires the Directors to consider intangible assets and
goodwill for impairment on an annual basis. The last review was
performed at 30 June 2016 and has not been updated at the interim
date.
The Group is in the process of finalising the valuation of the
deferred consideration and the purchase price allocation exercise
with regard to the business combinations undertaken during the
period ended 31 December 2016, in order to recognise separately
from goodwill the identifiable assets acquired, together with their
estimated useful economic lives. The valuation of the deferred
consideration and completion of the purchase price allocation
exercise will be finalised in due course and included in the
audited annual financial statements for the year ending 30 June
2017.
3. Earnings per share
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
-------------------------- ------------ ------------ ------------
Profits/(Losses)
Loss from continuing
operations attributable
to owners of the parent (858) (805) (1,526)
No. No. No.
-------------------------- ------------ ------------ ------------
Number of shares
Weighted average number
of ordinary shares for
the purposes of basic
and diluted earnings
/loss per share 300,746,398 267,306,414 282,348,087
-------------------------- ------------ ------------ ------------
Earnings/(Loss) per
share (0.29) (0.30) (0.54)
-------------------------- ------------ ------------ ------------
4. Share capital
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
----------------------------- ------------ ------------------- -------------------
Fully paid ordinary
shares:
Authorised:
300,000,002 (30 June
2016: 300,000,002)
ordinary shares of
5p each 18,523 18,523 18,523
------------------------------ ------------ ------------------- -------------------
Issued and fully paid:
302,421,389 (30 June
2016: 297,853,104)
ordinary shares of
5p each 20,123 19,549 19,601
------------------------------ ------------ ------------------- -------------------
Deferred ordinary shares:
Authorised:
900,447 (30 June 2016:
900,447) deferred ordinary
shares of GBP4.99 each 6,503 6,503 6,503
------------------------------ ------------ ------------------- -------------------
6 months 6 months Year
ended ended ended
31 December 31 December 30 June
2016 2015 2016
No. '000 No. '000 No. '000
----------------------------- ------------ ------------------- -------------------
Issued and fully paid
ordinary shares:
Balance at beginning
of financial period 297,853 236,116 236,116
Issued during the period 4,568 60,857 61,737
Balance at end of financial
period 302,421 296,793 297,853
------------------------------ ------------ ------------------- -------------------
5. Post Balance Sheet Events
In January 2017 Artilium PLC secured an expanded MVNE platform
agreement with its largest customer, Telenet Group BVBA
("Telenet"), securing the relationship for the next five years.
Telenet has decided, given the importance of the partnership and
their overall satisfaction with Artilium's solutions, to make a
commitment to Artilium for the services it is due to receive over
the next five years. As part of the extension, Artilium has
received cash of EUR5.3 million, comprising revenue which will be
recognised in equal instalments over the next five years.
6. Further Copies
Copies of the half-yearly financial report are available from
the Company's registered office at 9-13 St. Andrew Street, London
EC4A 3AF and on the Company's website www.artilium.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR KMGZFVNFGNZM
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