Interim Results
05 Setembro 2001 - 4:01AM
UK Regulatory
RNS Number:4584J
Biotrace International PLC
5 September 2001
FOR IMMEDIATE RELEASE: 07.00am - Wednesday 5 September 2001
BIOTRACE INTERNATIONAL PLC
ANNOUNCES INTERIM RESULTS
for the six months ended 30 June 2001
Biotrace International Plc ("Biotrace" or the "Company"), leader in the
manufacture and marketing of rapid response systems for hygiene control and
microbial detection, today announces its interim results for the six months
ended 30 June 2001.
Highlights
* Sales up 18% to #4.3M (2000: #3.7M)
* Pre-tax profit up 787% to #0.9M (2000: #0.1M)
* Earnings per share improved seven-fold to 2.2p (2000: 0.3p)
* Reagent sales grew by 18% over the same period last year
* Further expansion into the US market achieved through acquisitions of
Cogent Technologies and UltraSource Inc.
* Formation of Lucigen Ltd., a JV with Defence Science and Technology
Laboratories
* New agreement, announced today, with Pepsi Bottling Group to supply
hygiene testing systems to all Pepsi's North America manufacturing sites
* Release of #1.3M cash, through sale and leaseback of property to
Mansford Biotrace Ltd.
* #2.8M cash in hand
* No interim dividend recommended - payment of a final dividend under
consideration
Commenting on the results, Terry Clements, Non-executive Chairman, said:
"I am pleased to report a significant increase in the growth of the Business
as well as a substantial improvement in profits and EPS. The financial year
has started well with sales in the food safety division growing particularly
strongly. Each of the Group's three divisions has grown organically over the
period under review with this growth being complemented through acquisition
or joint venture. It is the view of your Board that these developments will
begin to impact on growth during the second half of the year.
"The Board believes that Biotrace is now well placed to build a substantially
larger business which is set to deliver sustained growth in sales and
profits."
For further information, please contact:
Biotrace International On 05.09.01: +44 (0) 20 7466 5000
Ian Johnson, Chief Executive Officer Thereafter: +44 (0) 1656 641 400
Peter Morgan, Finance Director
Buchanan Communications Tel: +44 (0) 207 466 5000
Nicola How / Louise Bolton
Financial Review:
Sales for the half year increased by 18% to #4.3M (2000: #3.7M) with profit
before tax, excluding profit from disposal of fixed assets, increasing by 545%
to #0.7M (2000: #0.1M). Profit before tax including the profit from the
disposal of fixed assets was #0.9M - this was due to a gain on the disposal of
Biotrace's head office of #0.2M. First half sales also grew by 9% compared
to the second half of 2000 (#4.0M), with profits, excluding profit from
disposal of fixed assets, increasing by 53% from #0.4M.
This increase in sales combined with stable gross margins at 69% and a
reduction in overheads, yielded a substantial increase in profitability and
the generation of a significant cash inflow of #2.1M. The Company announced
in May 2001 that it had entered into a JV with Mansford Holdings Plc for the
sale and lease back of its property assets. This released #1.3M of cash
which, together with the cash generated from normal operations, produced cash
in hand of #2.8M at the end of the period. This is an increase of #2.1M since
31 December 2000. Shareholders' funds have increased 13% since the end of the
previous financial year with earnings per share increasing seven fold from
0.3p at June 2000 to 2.2p for the first half of 2001. At the Company's Annual
General Meeting, a resolution to allow the buy back of up to 10% of the
Company's shares was passed. To date no shares have been purchased.
No interim dividend is recommended, however, a payment of a final dividend is
under consideration.
Operating Review:
Instrument sales increased by 47%, whilst related reagent sales advanced by
18%. Geographically, all regions recorded sales well above the same period
last year, with North America growing at an exceptional rate of 33%. With
the recent US acquisitions, this North American growth trend looks set to
continue.
The Food Safety Division achieved impressive growth compared with the first
half of 2000. Overall, sales grew by 21% to #2.8M with hygiene testing sales
increasing by 19% and end product testing growing by 49%. The acquisition of
Cogent Technologies of the US in May 2001 resulted in only a six-week
contribution to end product testing sales, however, a more significant impact
is expected going forward. Cogent Technologies based in Cincinnati, USA, is a
leading supplier of instruments and reagents for sterility testing of UHT
dairy products to the North American dairy industry.
Additionally, and announced today, Biotrace has reached agreement with the
Pepsi Bottling Group to supply hygiene testing systems to all of their 54
manufacturing sites in North America. The decision to use only Biotrace
hygiene tests represents a massive endorsement for our technology and for the
service and support package which Biotrace and our North American distributor,
Neogen Corporation, are now able to offer.
The Industrial and Environmental Division recorded sales 4% ahead of the same
period last year at #0.4M. This was slightly below expectations, however, it
is expected to grow at a more rapid pace going forward due to the
restructuring of the division in the second quarter as a result of the
acquisition of UltraSource Inc. in March 2001. Ultrasource is a specialist
supplier of rapid microbiology products to the industrial sector.
Sales in the Civil Defence and Military Division were ahead of expectations in
the first half at #1.1M, representing 18% growth over the same period last
year. As anticipated, the Division has received its first orders to supply
specialist air monitoring equipment to export markets. These orders will be
fulfilled during the second half of the year. The Company announced in July
2001 the formation of a joint venture with the Defence Science and Technology
Laboratories (Dstl). The new company, Lucigen Ltd, will develop and
manufacture defence-critical reagents, thereby complementing those products
already manufactured and supplied by Biotrace. This will strengthen the Civil
Defence and Military Division's technological base and enhance its prospects
as a supplier to this sector, world-wide.
Product improvement and new product development remains a key activity to fuel
organic growth. To this end the Company has launched a new version of
Biotrack software, for use with its Uni-Lite Xcel instrument base. This
powerful software package enables food manufacturers to track and trend the
results of hygiene testing to indicate that correct cleaning procedures are
being used and to highlight any areas that are out of specification. Later in
the year, the Company will announce the launch of two additional food safety
products - both of which have been developed in-house.
Outlook:
The Company has firmly re-established top line growth and traded profitably
for the last 18 months. It is now well placed to take advantage of the
opportunities that exist to build a substantially larger business and become a
leading manufacturer and supplier of innovative products to the microbiology
market. With significant cash reserves and strong cash flow, Management is
now able to focus on implementing its strategy to achieve this objective.
By continuing to concentrate on delivering new and improved products via
in-house development and by acquisition, Biotrace will increase its market
presence and top line growth, whilst satisfying more of the needs of its
growing customer base. Additionally, more emphasis is being placed on
developing a strong presence in Europe to deliver a growing product portfolio.
Finally, to take advantage of the opportunities to sell existing products to
new markets, Biotrace will enter the healthcare market within the next 12
months to address the growing concern over hospital hygiene.
In the short term, Management will continue to unlock the significant
potential of the Company's technology, fuelling organic growth, as well as
continuing to look at appropriate acquisitions, which will further enhance
sales and profits. Biotrace serves large and growing markets that have
proved resilient to the economic downturn experienced elsewhere. The Board
is, therefore, confident that the implementation of the strategy outlined
above will continue to increase shareholder value.
Consolidated Profit and Loss Account
Unaudited Unaudited Audited
Six Six Year to
months months 31.12.00
to to
30.6.01 30.6.00
#'000 #'000 #'000
Turnover (continuing operations) (Note 1) 4313 3652 7621
Cost of sales (1313) (1126) (2439)
Gross profit 3000 2526 5182
Administrative expenses
- Ordinary (1841) (1941) (3683)
- exceptional - - (72)
(1841) (1941) (3755)
Development costs (529) (462) (887)
Operating profit (continuing operations) 630 123 540
Share of operating profit in joint venture 5 - -
Profit/(loss) from fixed asset disposals 247 (8) 5
Interest receivable and similar income 28 2 4
Interest payable and similar charges - Group (1) (15) (18)
- Joint Venture (4) - -
Profit on ordinary activities before taxation 905 102 531
Tax on ordinary activities (141) - (66)
Profit on ordinary activities after taxation 764 102 465
Earnings per ordinary share (Note 4)
- Basic 2.21p 0.30p 1.35p
- fully diluted 2.21p 0.30p 1.35p
- before profit from disposal of fixed 1.50p
assets
Consolidated Balance Sheet
Unaudited Unaudited Audited
As at As at As at
30.6.01 30.6.00 31.12.00
#'000 #'000 #'000
Fixed assets
- intangible 1249 588 554
- tangible 693 2125 1892
Current assets
Stocks 1367 1905 1706
Debtors 2171 1736 1672
Cash at bank and in hand 2790 324 731
6328 3965 4109
Creditors: amount falling due within one year (2061) (1449) (1083)
Net current assets 4267 2516 3026
Total assets less current liabilities 6209 5229 5472
Creditors: amounts falling due after more than - (26) (12)
one year
Total Net Assets 6209 5203 5460
Capital and reserves
Called up share capital 3454 3435 3440
Share premium account 5869 5777 5779
Revaluation reserve - 104 104
Profit and loss account 27
Shareholders' funds (3106) (4113) (3863)
6209 5203 5460
Consolidated Cash Flow Statement
Unaudited Unaudited Audited
Six Six Year to
months months
31.12.00
to to
30.6.01 30.6.00
#'000 #'000 #'000
Net cash inflow/(outflow) from operating activities 1331 842 1324
Returns on investments and servicing of finance
Interest received 28 2 4
Interest paid - (13) (14)
Interest paid in respect of hire purchase (1) (2) (4)
agreements
27 (13) (14)
Taxation
Amounts received/(paid) in respect of UK 3 97 84
Corporation tax
Capital expenditure and financial investment
Payments to acquire intangible fixed assets (430) - -
Payments to acquire tangible fixed assets (80) (119) (192)
Receipts from sales of tangible fixed assets 1189 8 14
679 (111) (178)
Acquisition and disposals
Purchase of subsidiary undertakings - (15) (15)
Net overdrafts acquired with subsidiary - (22) (22)
- (37) (37)
Cash flow before financing 2040 778 1179
Financing
Issue of ordinary share capital 27 48 55
Repayment of capital element of hire purchase and
finance lease agreements (14) (12) (22)
Net cash inflow/(outflow) 2053 814 1212
Notes to the Accounts
Note 1:
On 6 March 2001 the Company, through its North American subsidiary Biotrace
Inc., acquired the net assets and liabilities of UltraSource Inc for #35,000.
Following the integration of UltraSource within the Group, its contribution to
Group sales and operating profit are not separately identifiable.
Also on 17 May 2001 the Company, through its North American subsidiary
Biotrace Inc., acquired the net assets and liabilities of Cogent Technologies
Ltd. for #707,000 with payment of #284,000 of this amount deferred until May
2002. From the date of acquisition to 30th June 2001 turnover and operating
profit of Cogent included in the Group results amounted to #50,000 and #17,000
respectively.
The initial estimate of goodwill acquired arising from these transactions
representing the excess of the purchase consideration over the fair value of
the net assets acquired, is:
Consideration Acquisition Provisional fair value of Goodwill
satisfied by cash Costs Net (Assets)/ Arising
Liabilities acquired
#'000 #'000 #'000 #'000
UltraSource 35 9 25 69
Cogent 711 16 (70) 657
Goodwill is capitalised and amortised over 20 years
Note 2:
The total recognised gains and losses in the period comprise the profit made
in the six months of #764,000 and a loss in net investment in foreign
enterprises arising from changes in foreign currency rates of #44,000.
Note 3:
Earnings per ordinary share is based on the profit on ordinary activities
after taxation and on 34.5 million ordinary shares in issue during the period
(2000: 34.2 million ordinary shares). Fully diluted earnings per share is
based on the profit after taxation and 34.6 million (2000: 34.4 million)
ordinary shares. The earnings per share before the profit arising on the
disposal of fixed assets in 2001, is calculated using profit after taxation of
#517,000.
Note 4:
The interim accounts included in the financial information are not audited,
and do not constitute full statutory accounts within the meaning of Section
240 of the Companies Act 1985. Full financial statements of Biotrace
International Plc for the year ended 31 December 2000 on which the auditors
gave an unqualified audit report have been delivered to the Registrar of
Companies. The Interim Report is being sent to registered shareholders.
Further copies are available from the Company's Registered Office at The
Science Park, Bridgend, CF31 3NA. The accounts have been prepared under the
historical cost convention and in accordance with applicable accounting
standards and have been drawn up under the same accounting policies as those
used for the financial statement for the year ended 31 December 2000.
Note 5
This Interim Statement was approved by the Board of Directors on 4 September
2001.
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