TIDMIDEA

RNS Number : 4334D

Ideagen PLC

29 January 2015

Ideagen PLC

("Ideagen" or the "Group")

Unaudited interim results for the six months ended 31 October 2014

Ideagen PLC (AIM: IDEA), a leading supplier of Information Management software to highly regulated industries, announces its unaudited interim results for the six months ended 31 October 2014.

Financial Highlights

   --     Revenue increased 53% to GBP5.65m (2013: GBP3.70m) 

o Underlying organic revenue growth of 10%*

o Recurring revenues represent 86% of the fixed overhead base

   --     Adjusted EBITDA** increased by 23% to GBP1.46m (2013: GBP1.19m) 
   --     Adjusted PBT*** increased by 18% to GBP1.29m (2013: GBP1.09m) 
   --     Adjusted diluted EPS*** increased by 20% to 0.84p (2013: 0.70p) 
   --     Cash generated by operations of GBP0.48m (2013: GBP0.02m) 
   --     Net cash of GBP2.8m (30 April 2014: GBP4.0m; 31 October 2013: GBP5.3m) 
   --     Net Assets of GBP14.0m (30 April 2014: GBP13.4m; 31 October 2013: GBP12.8m) 
   --     10% increase in interim dividend to 0.055 pence (2013: 0.05 pence) 

*Underlying organic growth is calculated by comparing the results for the current period with the pro-forma results for the comparative period and excludes revenue generated from the cancelled VA Prism contract.

**Before share based paymentsof GBP0.09m (2013: GBP0.14m) and costs of acquiring businesses of GBP0.07m (2013: GBP0.07m).

***Before share based payments of GBP0.09m (2013: GBP0.14m), costs of acquiring businesses of GBP0.07m (2013: GBP0.07m) and amortisation of acquisition intangibles of GBP0.68m (2013: GBP0.36m).

Operational Highlights

-- Acquisition and integration of EIBS Ltd ("EIBS") strengthening the Group's position in the UK Healthcare sector and providing the group with leading intranet, portal and mobile technology

   --     Launch of dart/Portal, a Patient Information Portal based on EIBS technology 
   --     Largest single NHS contract win to date at Doncaster and Bassetlaw NHS Trust worth GBP1m 
   --     Strong performance in the resurgent nuclear sector 

-- Strong account management and customer retention resulting in support and maintenance contract renewal rate of 97%

Post Period End Highlights

-- Acquisition of Gael Limited ("Gael") for net cash consideration of GBP18m, transforming the Group's financial, product and market position

-- New equity funding of GBP17.5m raised in oversubscribed placing to fund the acquisition of Gael and provide working capital

David Hornsby, CEO of Ideagen, commented:"We are delighted with progress made in the first half having met both our growth and strategic objectives for the period. Recurring revenues remain strong and we continue to win new contracts. Furthermore, in line with our strategy of acquiring businesses with strong IP and recurring revenues, we successfully acquired and integrated EIBS during the period and, post period end made the transformational acquisition of Gael, providing the Group with greater scale and an enhanced product proposition. Current trading remains in line with market expectations and the Directors look to the future with confidence."

Enquiries:

 
Ideagen plc 
David Hornsby, Chief Executive                 01629 699100 
Graeme Spenceley, Finance Director             01629 699100 
finnCap Limited                                0207 220 0500 
Charlotte Stranner (Corporate Finance) 
Victoria Bates / Stephen Norcross (Corporate 
 Broking) 
 

Chief Executive's Statement

I am pleased to announce our results for the six months ended 31 October 2014. Overall, the period saw further progress for the Group through continued organic revenue and profit growth and a further acquisition. There was continued investment in product development, sales resource and additional management alongside revenue growth of 53%, adjusted EBITDA growth of 23% and adjusted diluted EPS growth of 20%.

The focus of the Group remains the design and supply of Information Management software to organisations that operate within highly regulated industries.

The Group has established a global business supplying Governance, Risk and Compliance (GRC) solutions, predominantly to the Healthcare, Complex Manufacturing, Banking and Finance and the Aviation Sectors. The Group has, in parallel, leveraged its core technology and has acquired capability to build a UK business supplying content and clinical management solutions predominantly to the NHS.

Each of the Group's chosen markets require robust information systems and exhibit a high consequence of error should data and processes be compromised.

In June 2014, the Group completed the acquisition of EIBS Ltd ("EIBS"), a supplier of Intranet, Portal, and Mobile solutions. EIBS has annual revenues of approximately GBP1.4m of which GBP0.9 million is recurring, and in excess of 140 customers including 40 NHS Trusts.

Prior to the acquisition of EIBS, the Directors had identified a need to develop an Information Portal to enhance the Groups NHS proposition. EIBS has now been integrated into the Group and its technology underpins the Group's portal and mobile product roadmap whilst adding a valuable customer base generating recurring revenues.

The Group continues to benefit from robust recurring revenues across the business and has invested in additional resources to manage the customer base resulting in a maintenance and support renewal rate of 97%. Recurring revenues now represent 56% of our software and services revenue and cover 86% of the fixed overhead base.

Events after the end of the period

On 13 January 2015 the Group announced that it had completed the acquisition of Gael, a software company that provides solutions to help organisations manage Governance, Risk and Compliance (GRC) requirements, for net cash consideration of GBP18 million. The acquisition of Gael will enable further consolidation of the Group's current manufacturing and healthcare sectors and provides a strong entry point into the aviation sector all of which are subject to increasing regulatory pressures.

In order to part fund the initial cash consideration for the acquisition of Gael, the Company issued 51,470,589 new ordinary shares at 34 pence per share in a share placing which was completed on 9 January 2015. The gross proceeds of the placing before commissions and costs were GBP17.5 million.

Gael has a well dispersed customer base of over 1,000 customers and has a number of blue chip clients, including Emirates, BAE Systems, Dairy Crest and the NHS. The acquisition is in line with the Group's strategy of acquiring complementary businesses that have strong IP and significant recurring revenues. The addition of Gael to the Group has transformed our scale, market position and product capability.

Governance, Risk and Compliance (GRC)

For our customers, GRC represents a key corporate initiative for improving governance through more effective compliance and a clearer understanding of the impact of risk on business performance. The Group's expertise is the development and implementation of software tools that enable our customers to identify, assess and prioritise risk and to manage information to comply with regulations.

Highly regulated organisations are obliged to demonstrate compliance with industry standards, regulations and KPIs which acts as a compelling driver for investment in the Group's products. Increasingly such organisations are also required to demonstrate that they have the tools in place to proactively monitor and assess their operations to ensure that they can respond quickly to potential risks. The Group has made significant investment in R&D over the past few years as it has developed new products to meet the demand for "risk based compliance" solutions for its target markets.

The strict management of crucial content has been a core competence of the Group for a number of years and, following the recent acquisitions of Pentana Ltd and Gael, we can now combine audit and risk capability together with formal document control and business process management in the areas of competency, incident reporting and corrective action planning. This provides the Group with a broader integrated GRC proposition which we believe will be of interest to our enlarged customer base.

The Group's capability within GRC can be divided into four areas:

1. Risk Management

Identification and mitigation of risks is of increasing importance in almost every organisation, but given recent disasters and legal actions, having a reliable system of risk management is particularly important in the finance, pharmaceutical, energy and aviation sectors. The Group has been successfully supplying software to these sectors for many years. Customers include banks which need to demonstrate a system of operational risk management for compliance with Basel II and aviation companies that need to pro-actively assess risk in real time to improve safety.

2. Standards/Quality Compliance

The Group's solutions are used by companies to help them maintain compliance with internationally recognised standards and internal business processes. There are over 19,000 ISO standards which are published by the International Organisation for Standardisation.

Whilst the Group's software covers a number of specific standards relating to health and safety, information security and environmental compliance, the main standards which the Group's products help customers comply with are based around ISO9000 Quality Management. The ISO9000 family of standards are related to quality management systems and are designed to ensure that organisations meet the needs of customers and other stakeholders.

In the Directors' experience, successful Quality Management can improve business performance, often driving a positive effect on investment, market share growth, sales growth, margin expansion, increased competitive advantage and the avoidance of litigation.

3. Audit Management

As the GRC "third line of defence" after risk management and policy oversight, audit teams and the Audit Committees to which they report have a vital role in providing continued assurance on the governance of organisations. In providing that assurance, auditors of global organisations have to operate in situations where the technology may be slow or only allow occasional on-line working. The Group's audit management software uses the latest technologies to ensure that auditors can keep working effectively in global environments, while allowing central management reporting and review of their work on a single global database.

4. Audit Compliance

With its focus on the audit profession, Pentana has brought to the Group an added dimension in audit and financial regulatory compliance. 18 of the top 25 UK accounting firms use the Pentana Disclose(TM) software to ensure that their client's financial statements conform to UK disclosure requirements and this market position is also reflected in use of the software for compliance with International Financial Reporting Standards internationally. Pentana software is also used by audit regulators around the world to ensure that accounting firms of all sizes comply with the International Standards on Auditing.

Content and Clinical Solutions

The Directors believe that the UK healthcare market represents a significant growth opportunity for the Group following the dismantling of the NHS National Programme for IT ("NPfIT"). Many of the current IT drivers within the NHS are focused on improving healthcare governance through the implementation of more robust Information Management systems with the objective of improving service levels and patient care.

Through the acquisitions of Plumtree, MSS and EIBS, the Group has established a significant footprint in the UK Healthcare sector. The failure of the National Programme for IT to deliver an integrated patient records solution has provided an opportunity for agile vendors to provide point solutions to address specific information challenges.

This opportunity has been confirmed by Jeremy Hunt, Minister of State for Health, who has set objectives for a paperless NHS by 2018 with a budget being made available to achieve this. This strategy is supported by a funded programme aimed at improving information governance and reducing patient risk whilst delivering cost savings through the implementation of a digital patient record.

The Directors estimate that only approximately 30% of the 192 NHS Trusts in the United Kingdom have implemented a trust-wide Patient Document Repository and therefore believe that there is a significant market opportunity over the coming years.

To date the Group has supplied eleven NHS Trusts in England and Scotland with a trust-wide solution to integrate patient documents across departments. Typically these solutions represent a major long term investment for a Trust and represent a significant increase in transaction value for the Group.

Following the acquisition of EIBS, the Group now has a further opportunity to supply Trust wide Information Portals to provide a single view of Patient Information fed from multiple data sources.

The Group is therefore now focused on providing digitised solutions in six key areas:

   1)    Clinical Enterprise Document Repository 
   2)    Clinical Electronic Forms and Workflow 
   3)    Clinical Enterprise Portal to provide a single patient view 
   4)    Order communications to provide automated ordering of services between GPs and Hospitals 
   5)    Emergency Department Management 
   6)    Mobile Solutions 

The primary market for these solutions are the 166 Acute Trusts within England, the 14 Regional Health Boards in Scotland, 7 Local Health Boards in Wales and 5 Health Trusts in Northern Ireland. The Group has also identified an emerging opportunity for Order Communications software at hospitals in the Benelux region and private laboratories within the UK.

Staffing and Infrastructure

The Group has implemented a fully integrated Group structure with functions covering Sales and Marketing, Customer Services and Support, Research and Development and Finance and Administration and a member of each function is represented on the executive management team.

Following the acquisition of Gael the Group currently has 243 employees across the following functions: Sales and Marketing - 60, Customer Services and Support - 78, Research and Development - 79, Finance and Administration - 24, Executive Directors 2.

Current Trading & Outlook

The Group has a solid platform of contracted recurring and project revenue and a strong pipeline of new sales opportunities. The Board is therefore confident that the Group's momentum and enhanced scale following the Gael acquisition will continue to deliver strong and profitable growth this year and beyond.

David Hornsby

Financial Review

Revenue for the six months ended 31 October 2014 increased by 53% to GBP5.65m (2013: GBP3.70m). Within this, underlying organic revenue growth was 10% based on a comparison of revenue in the current period with pro-forma revenue for the comparative period adjusted to include the EIBS, Pentana and MSS acquisitions for the same time period and excluding revenue generated from the cancelled VA PRISM contract of GBP273,000 in the 6 months to 31 October 2013.

Adjusted EBITDA increased by 23% to GBP1.46m (2013: GBP1.19m). Amortisation of acquisition intangibles of GBP0.68m (2013: GBP0.36m) represents the majority of the total depreciation and amortisation charge of GBP0.85m (2013: GBP0.47m).

The adjusted group tax charge of GBP0.20m (2013: GBP0.20m), excluding the deferred tax credit of GBP0.13m (2013: GBP0.07m) on amortisation of acquisition intangibles, benefitted from lower tax rates and R&D tax credits. This represents 16% (2013: 19%) of adjusted PBT of GBP1.29m (2013: GBP1.09m).

As a result of the above, adjusted diluted earnings per share increased by 20% to 0.84p (2013: 0.70p).

The Group's financial position has continued to strengthen with net assets increasing to GBP14.0m at 31 October 2014 (30 April 2014: GBP13.4m; 31 October 2013: GBP12.8m). Intangible assets increased to GBP13.4m (30 April 2014: GBP11.8m; 31 October 2013: GBP8.6m) mainly through business acquisitions. Net current assets at 31 October 2014 were GBP1.79m (30 April 2014: GBP2.6m; 31 October 2013: GBP4.73m), the reduction resulting primarily from the utilisation of the Group's cash balances to make business acquisitions.

Cash balances at 31 October 2014 were GBP2.8m (30 April 2014: GBP4.0m; 31 October 2013: GBP5.3m). Cash generated by operations for the 6 months to 31 October 2014 amounted to GBP0.48m (2013: GBP0.02m). Cash generation in the period was adversely affected by cash outflows connected with unusually high hardware purchases towards the end of the financial year ended 30 April 2014. The net cash outflow on the acquisition of EIBS during the period was GBP1.26m.

Events after the end of the reporting period

On 13 January 2015, Ideagen acquired the whole of the issued share capital of Gael Limited ("Gael"), a company domiciled in Scotland. The initial cash consideration at completion was GBP17.7m. Gael had approximately GBP2.9m of cash reserves at completion, so the initial net cash consideration was approximately GBP14.8m. Two further cash payments of GBP1.6m each are due on the first and second anniversaries of the completion date.

In order to part fund the initial cash consideration for the acquisition of Gael, the Company issued 51,470,589 new ordinary shares at 34 pence per share in a share placing which was completed on 9 January 2015 on the admission of these shares to trading on AIM. The gross proceeds of the placing before commissions and costs were GBP17.5m.

Dividend

The Directors intend to increase the interim dividend by 10% to 0.055 pence per share (2013: 0.05 pence per share). The dividend will be paid on 11 March 2015 to shareholders on the register on 20 February 2015. The corresponding ex-dividend date is 19 February 2015.

Graeme Spenceley - Finance Director

Ideagen plc

Consolidated Statement of Comprehensive Income for the six months ended 31 October 2014

 
                                                         Six months   Six months 
                                                            ended        ended 
                                                          31 October   31 October 
                                                             2014         2013 
                                                           GBP'000      GBP'000 
Revenue                                                        5,653        3,704 
Cost of sales                                                  (949)        (589) 
Gross profit                                                   4,704        3,115 
Operating costs                                              (3,247)      (1,923) 
                                                         -----------  ----------- 
Profit from operating activities before depreciation, 
 amortisation, 
 share-based payment charges and exceptional 
 items                                                         1,457        1,192 
 
Depreciation and amortisation                                  (847)        (469) 
Share-based payment charges                                     (85)        (142) 
Costs of acquiring businesses                                   (74)         (72) 
                                                         -----------  ----------- 
Profit from operating activities                                 451          509 
 
Finance income                                                     2            6 
                                                         -----------  ----------- 
Profit before taxation                                           453          515 
Taxation expense                                                (75)        (137) 
                                                         -----------  ----------- 
Profit for the period                                            378          378 
 
Other comprehensive income 
Exchange differences on translating foreign 
 operations                                                       13          (7) 
 
Total comprehensive income for the period 
 attributable to the owners of the parent 
 company                                                         391          371 
                                                         ===========  =========== 
 
 
Earnings per share                                             Pence        Pence 
 
Basic                                                           0.31         0.31 
Diluted                                                         0.29         0.30 
 

Ideagen plc

Consolidated Statement of Financial Position at 31 October 2014

 
                                         31 October   30 April   31 October 
                                            2014        2014        2013 
                                          GBP'000     GBP'000     GBP'000 
 Assets and liabilities 
 Non-current assets 
 Intangible assets                           13,419     11,807        8,616 
 Property, plant and equipment                  202        166          176 
 Deferred income tax assets                     171        173          186 
                                        -----------  ---------  ----------- 
                                             13,792     12,146        8,978 
                                        -----------  ---------  ----------- 
 Current assets 
 Inventories                                     96        389            - 
 Trade and other receivables                  4,024      3,637        3,020 
 Cash and cash equivalents                    2,806      4,011        5,273 
                                        -----------  ---------  ----------- 
                                              6,926      8,037        8,293 
                                        -----------  ---------  ----------- 
 Current liabilities 
 Trade and other payables                     1,623      2,421        1,495 
 Contingent consideration on business 
  combinations                                  327        327           25 
 Current income tax liabilities                 492        283          430 
 Deferred revenue                             2,697      2,356        1,565 
 Deferred consideration on business 
  combinations                                    -         50           50 
                                        -----------  ---------  ----------- 
                                              5,139      5,437        3,565 
                                        -----------  ---------  ----------- 
 Non-current liabilities 
 Deferred income tax liabilities              1,611      1,377          911 
                                        -----------  ---------  ----------- 
 
 Net assets                                  13,968     13,369       12,795 
                                        ===========  =========  =========== 
 

Ideagen plc

Consolidated Statement of Financial Position at 31 October 2014 (continued)

 
                                         31 October   30 April   31 October 
                                            2014        2014        2013 
                                          GBP'000     GBP'000     GBP'000 
 
 Equity 
 
 Issued share capital                         1,229      1,219        1,219 
 Share premium                                6,983      6,870        6,870 
 Merger reserve                               1,167      1,167        1,167 
 Share-based payments reserve                   635        596          453 
 Retained earnings                            3,944      3,520        3,086 
 Foreign currency translation reserve            10        (3)            - 
 
 Equity attributable to owners of 
  the parent                                 13,968     13,369       12,795 
                                        ===========  =========  =========== 
 

Ideagen plc

Consolidated Statement of Cash Flows for the six months ended 31 October 2014

 
                                                   Six months         Six months 
                                                 ended 31 October   ended 31 October 
                                                       2014               2013 
                                                     GBP'000            GBP'000 
Cash flows from operating activities 
Profit for the period                                         378                378 
Depreciation of property, plant and 
 equipment                                                     60                 53 
Amortisation of intangible non-current 
 assets                                                       787                416 
Business acquisition costs in profit 
 or loss                                                       74                 72 
Share-based payment charge                                     85                142 
Finance income recognised in profit 
 or loss                                                      (2)                (6) 
Taxation charge recognised in profit 
 or loss                                                       75                137 
Net foreign exchange loss in profit 
 or loss                                                      (1)                  8 
Decrease in inventories                                       293                  - 
(Increase) in trade and other receivables                    (36)            (1,051) 
(Decrease) in trade and other payables                    (1,059)              (205) 
(Decrease)/increase in deferred revenue                     (173)                 74 
                                                -----------------  ----------------- 
Cash generated by operations                                  481                 18 
Interest received                                               2                  7 
Income tax repaid/(paid)                                       64               (77) 
Business acquisition costs paid                             (146)               (72) 
                                                -----------------  ----------------- 
Net cash generated/(used) by operating 
 activities                                                   401              (124) 
                                                -----------------  ----------------- 
 
Cash flows from investing activities 
Payments of deferred consideration on 
 business combinations                                       (50)              (106) 
Net cash outflow on acquisition of businesses 
 net of cash acquired                                     (1,259)              (589) 
Payments for development costs                              (368)              (238) 
Payments for property, plant and equipment                   (65)               (30) 
Net cash used by investing activities                     (1,742)              (963) 
                                                -----------------  ----------------- 
 
Cash flows from financing activities 
Proceeds from issue of shares under 
 share option scheme                                          123                  5 
Net cash generated by financing activities                    123                  5 
                                                -----------------  ----------------- 
 
Net decrease in cash and cash equivalents 
 during the period                                        (1,218)            (1,082) 
Cash and cash equivalents at the beginning 
 of the period                                              4,011              6,372 
Effect of exchange rate changes on cash 
 balances held in foreign currencies                           13               (17) 
Cash and cash equivalents at the end 
 of the period                                              2,806              5,273 
                                                -----------------  ----------------- 
 

Ideagen plc: Consolidated Statements of Changes in Equity

 
                         Share     Share     Merger   Share-based  Retained     Foreign         Total 
                         capital   premium   Reserve    payments    earnings    currency     attributable 
                                                        reserve                translation     to owners 
                                                                                 reserve     of the parent 
                        --------  --------  --------  -----------  ---------  ------------  -------------- 
 
                        GBP'000   GBP'000   GBP'000     GBP'000     GBP'000     GBP'000        GBP'000 
 
For the six months to 
31 October 
2014 
 
At 1 May 2014              1,219     6,870     1,167          596      3,520           (3)          13,369 
Profit for the period          -         -         -            -        378             -             378 
Share-based payments           -         -         -           85          -             -              85 
Shares issued under 
 share option 
 scheme                       10       113         -            -          -             -             123 
Transfer on exercise 
 of share 
 options                       -         -         -         (46)         46             -               - 
Other comprehensive 
 income for 
 the period                    -         -         -            -          -            13              13 
                        --------  --------  --------  -----------  ---------  ------------  -------------- 
At 31 October 2014         1,229     6,983     1,167          635      3,944            10          13,968 
                        ========  ========  ========  ===========  =========  ============  ============== 
 
 
For the six months to 
31 October 
2013 
 
At 1 May 2013              1,217     6,867     1,167          313      2,706             7          12,277 
Profit for the period          -         -         -            -        378             -             378 
Share-based payments           -         -         -          142          -             -             142 
Shares issued under 
 share option 
 scheme                        2         3         -            -          -             -               5 
Transfer on exercise 
 of share 
 options                       -         -         -          (2)          2             -               - 
Other comprehensive 
 income for 
 the period                    -         -         -            -          -           (7)             (7) 
                        --------  --------  --------  -----------  ---------  ------------  -------------- 
At 31 October 2013         1,219     6,870     1,167          453      3,086             -          12,795 
                        ========  ========  ========  ===========  =========  ============  ============== 
 

Ideagen plc: Consolidated Statement of Changes in Equity for the year ended 30 April 2014

 
                         Share     Share     Merger    Share-based  Retained     Foreign         Total 
                         capital   premium   reserve     payments    earnings    currency     attributable 
                                                         reserve                translation    to owners 
                                                                                  reserve        of the 
                                                                                                 parent 
                        --------  --------  ---------  -----------  ---------  ------------  ------------- 
 
                        GBP'000    GBP'000    GBP'000     GBP'000     GBP'000     GBP'000       GBP'000 
 
Balance at 1 May 2013      1,217     6,867      1,167          313      2,706             7         12,277 
 
Shares issued under 
 share option 
 scheme                        2         3          -            -          -             -              5 
Profit for the year            -         -          -            -        873             -            873 
Other comprehensive 
 income for 
 the year                      -         -          -            -          -          (10)           (10) 
Share-based payments           -         -          -          285          -             -            285 
Transfer on exercise 
 of share 
 options                       -         -          -          (2)          2             -              - 
Equity dividends paid          -         -          -            -       (61)             -           (61) 
 
Balance at 30 April 
 2014                      1,219     6,870      1,167          596      3,520           (3)         13,369 
                        ========  ========  =========  ===========  =========  ============  ============= 
 

Ideagen plc

Notes to the interim financial information

   1       Basis of information 

The interim financial information for the 6 months ended 31 October 2014 and the six months ended 31 October 2013 included in this announcement is unaudited. The financial information for the year ended 30 April 2014 included in this announcement does not constitute the annual report and accounts of the Company for the year ended 30 April 2014 within the meaning of section 434 of the Companies Act 2006. The audited annual report and financial statements of the Company for the year ended 30 April 2014 has been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain any statement under section 498 (2) or (3) of the Companies Act 2006 and did not include references to any matters to which the auditor drew attention by way of emphasis. Consistent accounting policies have been applied in the preparation of this information unless otherwise stated below.

   2       Earnings per share information 

Basic earnings per share is calculated by dividing the profit for the period attributable to the owners of the Company ('Earnings') by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by dividing Earnings by the weighted-average number of ordinary shares outstanding during the period as adjusted for the effect of all potentially dilutive shares, including share options.

In order to better demonstrate the performance of the Company, adjusted earnings per share calculations have also been presented which take into account items typically adjusted for by users of financial statements. The adjusted earnings and earnings per share information are shown below.

 
 Earnings per share information                      Six months    Six months 
                                                       ended 31      ended 31 
                                                       October       October 
                                                         2014          2013 
                                                       GBP'000       GBP'000 
 
 Profit for the period (Earnings)                            378           378 
 
 Adjustments: 
 Share-based payment charges                                  85           142 
 Deferred taxation on share-based payment charges              2             - 
 Costs of acquiring businesses                                74            72 
 Amortisation of acquired intangibles                        679           365 
 Deferred taxation on amortisation of acquired 
  intangibles                                              (131)          (68) 
                                                    ------------  ------------ 
 Adjusted earnings                                         1,087           889 
 Adjusted tax charge                                         204           205 
                                                    ------------  ------------ 
 Adjusted profit before taxation                           1,291         1,094 
                                                    ------------  ------------ 
 
 Weighted average number of shares                   122,625,927   121,757,776 
 Diluted weighted average number of shares           129,543,520   126,895,594 
 
 Basic earnings per share                             0.31 pence    0.31 pence 
 Diluted earnings per share                           0.29 pence    0.30 pence 
 Basic adjusted earnings per share                    0.89 pence    0.73 pence 
 Diluted adjusted earnings per share                  0.84 pence    0.70 pence 
 
   3       Events after the end of the reporting period: Share placing and acquisition of a business 

On 13 January 2015, Ideagen plc acquired the whole of the issued share capital of Gael Limited ("Gael"), a company domiciled in Scotland. The acquisition of Gael is expected to enhance the group's existing business through the addition of strong IP in the area of Governance, Risk and Compliance ("GRC") together with significant recurring revenues. The acquisition will enable further consolidation of the sectors within which the Group currently operates, namely healthcare and manufacturing, together with a strong entry point into the aviation sector.

The initial cash consideration at completion was GBP17.7 million. Gael had approximately GBP2.9 million of cash reserves at completion, so the initial net cash consideration was approximately GBP14.8 million. Two further cash payments of GBP1.6 million each are due on the first and second anniversaries of the completion date.

Some aspects of the initial accounting for the acquisition and in particular an assessment of the fair value of the intangible assets acquired in the business combination have not yet been completed and accordingly information has not been presented on assets and liabilities assumed at the date of acquisition.

In order to part fund the initial cash consideration for the acquisition of Gael, the Company issued 51,470,589 new ordinary shares at 34 pence per share in a share placing which was completed on 9 January 2015 on the admission of these shares to trading on AIM. The gross proceeds of the placing before commissions and costs were GBP17.5 million.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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